The Superior Court of the State of California recently made a ruling favorable to ACE Ltd. in a lawsuit brought against that company by subsidiaries of AIG and Chubb. The lawsuit focused on a restructuring plan implemented in 1996 by INA Financial Corp., which was subsequently acquired by ACE Ltd. in July 1999.
The purchase was part of ACE’s acquisition of CIGNA’s domestic and international property and casualty operations.
The Court found that the validity of the restructuring plan, which was approved by the Pennsylvania and California insurance departments, to be a matter for the regulatory authorities and that the complaint did not state a cause of action under California law. No present, reasonably foreseeable or imminent injury to policyholders was found to have been alleged by the plaintiffs. The Court also determined that there was no basis to find that notices regarding the restructuring, sent to California policyholders, were deceptive or misleading.
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