??Did you call the carriers?
Hey! Welcome to Not Billable, your weekly dose of legal insight and trends. Stop the clock, put the timesheet down and get ready to read an about an insurance nightmare, an iconic Christmas dispute, and the end of a Big Law firm.
Buckle up, this one is a ride. So as you are likely aware, the Supreme Court recently ruled against Harvard regarding use of affirmative action in college admissions. While a massive decision with significant implications, that's not at issue here. What's at issue is the bill.
HERE COMES THE CONTEXT:
Marsh is Harvard's insurance broker. They also administer Harvard's Errors & Omissions program — which features multiple layers of insurance. Without giving a big lesson on insurance law (although we really, really want to), let's use the example of a tower.
1. The bottom floor with the door is Harvard, which is $2.5M directly from them (self-insured layer);
2. The next floor up is AIG, which is a $25M dollar policy of insurance (the primary layer);
3. The floor above that is Zurich, which is a $10M dollar policy of insurance (first excess layer).
4. There is another floor above them, but we're not sure what the amount of insurance limits are (second excess layer).
Like a tower, you can't go up a floor unless you reach the stairs or elevator. That said, there are a number of rules you have to follow in order to get to that next floor. One is letting everyone know that you need to climb the tower.
That's what's being alleged here. The excess layers weren't given a heads up (tendered the claim) until 2017, 3years after the lawsuit began. That's called a reporting defense and resulted in Zurich not letting Harvard get to their tower floor.
After attempting to sue the carriers to establish that there was coverage (they could go to their floor) and losing, Harvard is now going after Marsh for failing to put everyone on notice (like they did with AIG).
THE VERDICT:
If your insurance broker is the one that notifies your insurance carriers of claims, make sure everyone who needs to be put on notice is on notice. From there, it's probably wise to confirm that everyone is aware. Double, triple, quadruple check if you have to.
Mariah Carey is back in court to defend her hit song, All I Want for Christmas Is You. Songwriter Vince Vance is again suing Carey (if you didn't know, this is the second attempt) for allegedly infringing on his 1989 song, All I Want for Christmas is You.
According to the complaint, Carey ripped the song from Vince Vance and the Valients after it had significant airtime in 1993 (a year before Carey's song was released) and that the origin story of Carey's song was fabricated.
THE VERDICT:
Given that Carey's song has topped the charts every holiday season for years, this case is big price tag. Expect extensive litigation over the next few years.
After being in business for more than 147 years, Stroock, Stroock, and Lavan, LP is closing it's doors. The Big Law firm partnership has voted to dissolve after a failed merger and a number of lawyers left for Hogan Lovells and other shops.
Stroock was founded in 1876 by M. Warley Platzek at 176 Broadway as a solo practice. Fast forward to 2022, the firm featured 222 lawyers with revenue of $250M. But a series of departures — a chunk of their bankruptcy practice to Paul Hastings and others to Steptoe & Johnson — helped lead to a big decline of the firm. Eventually there was an attempt to merge with Pillsbury Winthrop, but that failed. Coupled with another big departure of partners to Hogan Lovells and it spelled the end for Stroock.
THE VERDICT:
It may make sense to diversify your outside counsel panel, as this could really happen to any one of your law firm vendors.
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