Caterpillar Alleges Aon Participated in Anticompetitive Practices
Caterpillar Inc. is suing Chicago-based brokerage company Aon Corp., of whom it is a long-time client, alleging fraud and anticompetitive charges relating to its business practices.
October 19, 2007 at 12:56 PM
2 minute read
The original version of this story was published on Law.com
Caterpillar Inc. is suing Chicago-based brokerage company Aon Corp., of whom it is a long-time client, alleging fraud and anticompetitive charges relating to its business practices.
The Peoria, Ill.-based heavy equipment maker alleges Aon steered business to favored insurers, tied the placement of retail insurance business to the purchase of reinsurance brokerage services and manipulated pricing on client placements.
The suit, filed in U.S. District Court in Peoria, Ill., seeks damages, attorneys' fees, restitution and disgorgement.
This is not the first time Aon has faced such charges. Similar allegations were made against the company in 2005 by attorneys general in Connecticut, Illinois and New York.
Unlike the 2005 suit that charged the Chicago-based brokerage with fraud and unjust enrichment and the simultaneous settlement, Caterpillar accuses Aon and units Aon Risk Services of Illinois Inc. and Aon Re Global of five counts of violating federal and state antitrust laws along with other fraud and unjust enrichment allegations.
In settlement of the March 2005 case, Aon agreed to pay $190 million in client restitution and to change many business practices.
According to Caterpillar's complaint, before and after the 2005 settlement, Caterpillar asked Aon to review documents and information relating to its policies to determine whether the alleged business practices affected Caterpillar and, if so, to what extent. Aon failed to respond with adequate information, according to the suit.
Also, the suit alleges that because Aon remains Caterpillar's insurance broker, Caterpillar faces continued injury from the alleged improper business practices. Caterpillar has been an Aon client since 1981.
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