Milberg named in lawsuit
A group of insurers within Lloyds are taking legal action against law firm Milberg to rescind professional-liability insurance contracts after several former partners pleaded guilty to criminal charges, Dow Jones reports.
It is understood the firm paid $75 million in a settlement to avoid prosecution related to an improper kickback scheme.
A group of unnamed underwriters at Lloyd's of London, have filed a lawsuit in the U.S. District Court in Manhattan, to rescind insurance coverage for professional liability contracts issued to the firm between January 2001 and January 2004.
The lawsuit said: “At the time the contracts were made and thereafter, at least four partners of the firm, including the individually named defendants, were engaged - by their later admissions - in a criminal enterprise in their law practice.”
In June, Milberg avoided criminal prosecution by agreeing to pay $75 million in fines and penalties in connection with a scheme in which senior partners paid improper kickbacks to clients to ensure the firm had plaintiffs at the ready to bring lawsuits.
Milberg was unavailable for comment.
