Brooklyn Diocese is suing Royal Runoff Operation for alleged waste – business insurance
The Roman Catholic Diocese of Brooklyn has filed a lawsuit against the liquidation operation of Royal & SunAlliance USA Inc. and its directors and officers in a state court in North Carolina alleging that its owners wasted hundreds of millions of dollars in salaries and other expenses threatens its ability to pay potential liability costs related to child molestation lawsuits.
The sale of RSA USA to Arrowpoint Capital Corp. based in Charlotte, North Carolina, a vehicle established by RSA USA's management team, was approved by the Delaware Insurance Commissioner in 2007, followed by liquidation.
The diocese, a policyholder of the Arrowpoint unit Arrowood Indemnity Co., formerly known as Royal Indemnity Co., had numerous commercial liability insurance policies between 1956 and 2000, including the one in Charlotte in the Roman Catholic Diocese of. Lawsuit filed Brooklyn, New York against John Tighe et al.
Then in 2019 New York Governorate. Andrew Cuomo signed the New York Child Abuse Act, which extended the statute of limitations for victims of child abuse to file claims and resulted in the diocese receiving more than 500 such claims according to the litigation.
The lawsuit accuses the defendants of "falsely manipulating" Arrowood's statutory financial results, allowing the company to divest "well over" $ 500 million in the past "over ten" years, thereby affecting it legally and his ability to comply was jeopardized by his policyholder obligations.
The lawsuit, which states that the diocese is one of hundreds of Arrowood policyholders, accuses the defendants of “systematically and unjustifiably transferring hundreds of millions of dollars from Arrowood under the guise of grossly inflated salaries, deferred compensation plans, management fees, expenses, health plans to have". and retirement plans. "
The measures taken by the defendants mean that the diocese is unable to fully meet its defense and indemnity obligations and, at best, receives pennies on the dollar for the insurance cover it is entitled to.
The lawsuit, filed last week, alleges that the company has acted unfairly or fraudulently, and calls for at least $ 500 million in damages and the creation of a constructive trust to reclaim funds withdrawn from the insurer.
An Arrowpoint spokeswoman had no comment.