Tribune Co. recently filed a second suit in its efforts to recoup costs associated with $60 million paid in 1998 to Reliance National Indemnity to settle a portion of its self-insured workers’ compensation liabilities.
The latest suit is against Marsh & McLennan for referring Times Mirror in 1998 to the now defunct Reliance.
Tribune purchased Times Mirror in 2000 and since Reliance was liquidated in 2001 it has been forced to assume approximately $20 million in claims dating back to 1977 that should have been covered by the $60 million payment.
With its negligence and breach-of-fiduciary-duty suit, Tribune is seeking at least $8 million from Marsh & McLennan, according to the Los Angeles Times.
An interesting side note is that Times Mirror and Marsh & McLennan were connected in the boardroom at the time the transaction took place in 1998. Robert Erburu was the chairman of the Times Mirror board and CEO up until he joined Marsh & McLennan’s board of directors in 1996.
A similar suit seeking $20 million was filed in July of 2002 against Swiss Reinsurance America Corp.
When Reliance went under, Tribune believes Swiss Re should have picked up the tab for the remaining claims, but instead the suit alleged Reliance “acted merely as a ‘front’ or ‘pass-through’” for Swiss Re.
Adjuster / Examiner Claims Examiner Santa Ana Unified School District Santa Ana, CA