Calif. Court Sticks XL With $9M Payout In Bank D&O Case

Law360, New York (November 5, 2013, 2:06 PM EST) -- A California appeals court affirmed Monday that XL Specialty Insurance Co. cannot recover $9.3 million it paid settling a creditors’ suit against directors and officers of a failed bank, ruling the payment cleared XL of alleged bad faith and should not fall on the bank's primary D&O insurer.

A unanimous panel soundly rejected an XL lawsuit arguing that St. Paul Mercury Insurance Co. must share the settlement cost because XL's excess coverage payment released the insured directors and officers of defunct Vineyard Bank from claims that...
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