Former Olympus boss, Michael Woodford, is suing AIG for £1.36m, and the US insurer wanted to inspect confidential documents
US-based insurer AIG has lost its request to inspect documents related to a case involving a former Olympus boss turned whistleblower.
Michael Woodford is suing AIG for £1.36m, alleging that it failed to pay indemnity costs for a court case with his former employer, as reported by Law360.
He alleges that under his insurance policy, he is entitled to an indemnity pay-out. The case was submitted to the High Court in April 2017.
Woodford exposed one of Japan’s biggest corporate frauds when he questioned over £1.7bn worth of unexplained payments after being appointed CEO of Olympus.
He notified global watchdogs, and as a result, the company and three of its former executives pleaded guilty to cover-up charges.
In a separate case, Olympus-owned KeyMed filed a high court claim that Woodford and former Olympus director, Paul Hillman set up an executive pension plan to increase the security of their pension benefits.
The UK surgical products maker says both Woodford and Hillman had breached their duties as directors and trustees of a company pension plan and conspired to maximise their benefits by unlawful means. That trial is due to begin in March 2018.
But with the documents relating to AIG and Woodford, the insurer requested on the opening day of the trial to inspect around 100 emails between KeyMed directors.
It says they are relevant to the case because they allow it to refuse indemnity because KeyMed were aware of the alleged breaches.
KeyMed, however, said the documents are confidential and relevant to the case it is currently in the middle of. It, therefore, refused to waive its right of privilege over the documents.
AIG claimed KeyMed “maliciously refused” to release key information about the wrongdoing it was apparently aware of.
But Stephen Midwinter QC, the lawyer representing Woodford and Hillman refuted these claims:
“There was no refusal at all,” he told the hearing. “Even if there was, it would not affect a claim by an insured.”
Judge Jane Moulder agreed with KeyMed and refused to hear AIG’s application.
She said the emails “appear to go to the key issue in the case,” but found no need to chase the matter as KeyMed had refused to waive its right of privilege.
She said: “I cannot see how the court can order [KeyMed] to abandon its claim to privilege. AIG has not satisfied me that the parties would be in a position to go forward.”