In a rare move, a Delaware Supreme Court judge overturned a pro-insurance jury ruling last year in an insurance dispute between an entity of American International Group Inc. and a healthcare organization, and granted the policyholder a new trial.
AIG on Wednesday asked that the court allow it to reconsider the matter.
In June 2019, the Wilmington, Delaware, court ruled that the Texas Attorney General’s investigation into Dallas-based Conduent State Healthcare, which had processed requests from orthodontic providers for Medicaid services, triggered the obligation to pay defense costs under its insurance policies the Court’s February 14 judgment in Conduent State Healthcare LLC et al. v. AIG Specialty Insurance Co. which has just been unsealed.
The court also ruled that Conduent had established prima facie evidence that the defendants had an obligation to indemnify the company, the ruling said.
AIG had taken out professional indemnity insurance for Conduent, according to court filings.
In that case, there was ultimately a $236 million settlement.
“However, there were certain factual issues that remained unanswered by the jury,” including whether Conduent breached its duty to cooperate with insurers and obtain consent in connection with the Texas AG settlement, the dated judgment read 14th of February.
In February 2022, after a six-day trial, the jury ruled in favor of AIG, finding, among other things, that Conduent breached its duty to cooperate with its insurers.
In her opinion overturning the jury’s verdict, Judge Mary M. Johnston said. “In almost 20 years on this bench, I have never overturned a jury verdict” that “does deserve great deference.” This, she said, “should only be done in circumstances where justice would otherwise be denied.”
One of the reasons the court gave for overturning the sentence was a submission from the Texas Attorney General. Judge Johnson said she against her “better judgment” approved the bill, which was clearly “inadmissible hearsay, in fact double and triple hearsay” that “was not the subject of cross-examination”.
“In a short time, credibility (of the submission) became a core part of the process. And there was no way the jury could properly assess “its validity in the absence of … extrajudicial testimony, subject to cross-examination.”
AIG, in the filing filed Wednesday, requested that the court grant it a rewrite of its decision “particularly to address critical legal premises underlying its extraordinary decision to overturn the jury verdict … the 12 jurors voted unanimously in less than two hours.” four independent reasons.”
It said if the court stood by its grant of a new trial, it would appeal.
Conduent issued a statement in response to the February 14 verdict, which said, in part, “We knew that it is extremely rare to overturn a jury decision, but we strongly believed that the jury was misled and the justice was not remotely served a year ago. As such, we are grateful for the sophistication of the Delaware courts and feel vindicated by the court’s decision to overturn the verdict.”
Conduent Attorney Robin Cohen, chairman of Cohen Paragraph Frenchman & McKenna, issued a statement that said: “The judge set the ground rules before the jury trial.
“AIG and its attorney continuously and clearly violated her in many ways throughout the process, from opening to closing, which severely impacted the process.”
AIG had no comment.
