Insurance firm AmTrust Financial Services Inc. has filed to voluntarily dismiss all of its claims against one of its former insurance brokers in Italy who AmTrust alleged bribed an arbitrator.
The arbitrator had been called in to settle a business dispute between AmTrust and the broker.
AmTrust’s lawyers filed for the dismissal with prejudice in U.S. District Court in New York’s Southern District, noting that the defendant, Antonio Somma, had not yet appeared in the action or responded to its complaint.
The complaint withdrawal appears to put an end to the dispute between AmTrust and Somma. “AmTrust and Antonio Somma/ TRI/ TRG have resolved their differences and settled all matters between them on terms that remain confidential, ” Elizabeth Malone, senior vice president for investor relations for AmTrust, told Insurance Journal in an emailed statement.
AmTrust had complained that Somma bribed an arbitrator brought into rule after AmTust ended a joint medical malpractice insurance venture with his Naples insurance agency, Trust Risk Group. The brokerage arrangement was through AmTrust’s London-based subsidiary ATEL.
AmTrust says it ended the venture in 2013 because it had evidence that Somma was plotting to steal proprietary data and compete against AmTrust.
Somma wanted more than 1 billion euros ($1.14 billion) from AmTrust over the early termination of their business venture, an amount AmTrust called “an absurd and fantastical amount of money that bears no relation to any underlying reality.”
Somma sought arbitration over the ending of the business relationship. AmTrust alleged that Somma bribed the arbitrator, Marco Lacchini, offering 10 percent of any settlement he got.
AmTrust says the arbitration proceedings were a “sham,” in which Somma and Lacchini caused the arbitration panels to issue unreasonable procedural rulings written to coerce AmTrust into a large settlement.
AmTrust’s original complaint says its executive received threatening emails and a box with bullets after the deal went under.
AmTrust hired private investigators who the insurer says caught Somma and Lacchini on tape admitting they were working together against the insurer.
AmTrust moved to have the arbitrator dismissed. In May a judge in Milan granted AmTrust’s request to remove Lacchini because, he said, the allegations, although unproven, could affect his impartiality.
AmTrust brought the action under the Racketeer Influenced and Corrupt Organizations Act (RICO).
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