Cadwalader Completes Landmark Fortress Re Settlement; Produces Over $400 Million for Japanese Reinsurance Pool Members.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Cadwalader, Wickersham & Taft LLP LLP - Lower Layer Protocol , attorneys for Sompo Japan Insurance Sompo Japan Insurance Inc. (株式会社損害保険ジャパン Inc., announced today that on July 15, 2004 it completed the closing of a settlement with Fortress Re, a North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. pool manager, and its principals, that will produce over $400 million in recoveries for Sompo and two other Japanese insurance companies that were members of the Fortress Re reinsurance pool. The settlement was the result of a $1.119 billion arbitration award rendered December 18, 2003 in favor of Sompo and against Fortress Re, an award that was confirmed by the United States District Court United States District Court In the U.S., any of the 94 trial courts of general jurisdiction in the federal judicial system. Each state, as well as the District of Columbia and the Commonwealth of Puerto Rico, has at least one federal district court. for the Middle District of North Carolina by judgment entered March 10, 2004. Cadwalader litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. partner Cliff Schoenberg said "We were almost as thrilled with the size of the settlement as we were with the amount of the arbitration award which led to the settlement." Cadwalader litigation partners Howard Hawkins, John Finnegan, Phil Loree and Mike Dolan also worked on the matter. In December 2003, less than two weeks after the arbitration award, Fortress Re and its principals paid $265 million to Sompo and the other pool members as a refund of contingent profit commissions which were based on "profits" the arbitration panel arbitration panel A group of individuals charged with resolving a dispute between individuals and/or organizations. Arbitration panels to resolve investment disputes are sponsored by self-regulatory organizations such as NASD. found did not exist. The arbitration panel had also held that Fortress' principals Maurice Sabbah and Kenneth Kornfeld had defrauded Sompo by failing to disclose material facts in Fortress' accounting for financial reinsurance. The billion dollar award was one of the largest arbitration awards ever rendered. Mr. Schoenberg stated that Sompo and another pool member are continuing litigation against Fortress Re's auditors, Deloitte & Touche LLP, seeking to recover the balance of pool members' damages, which the arbitration panel found to be well in excess of $3 billion. About Cadwalader Cadwalader, Wickersham & Taft LLP, established in 1792, is one of the world's leading international law firms, with offices in New York, London, Charlotte and Washington. Cadwalader serves a diverse client base, including many of the world's top financial institutions, undertaking business in more than 50 countries in six continents. The firm offers legal expertise in securitization, structured finance, mergers and acquisitions, corporate finance, real estate, environmental, insolvency, litigation, health care, banking, project finance, insurance and reinsurance, tax, and private client matters. More information about Cadwalader can be found at www.cadwalader.com. |
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