Judge Pares Counterclaims In Ponzi Scheme Coverage Row

Law360, New York (December 5, 2012, 5:56 PM EST) -- A New Jersey federal judge on Wednesday nixed nearly all of a Philadelphia law firm's counterclaims against Colony Insurance Co. in litigation over whether the carrier can rescind a professional liability policy covering a lawyer accused of running an $8.5 million Ponzi scheme.

U.S. District Judge Noel Hillman said Kwasnik Kanowitz & Associates PC's claims accusing Colony of deceptive trade practices, fraud and breaching a duty to defend were impermissible "bald assertions" and "legal conclusions" that did not comply with minimum pleading requirements. The firm and...
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