After toiling through four years of litigation over MBIA Inc.’s controversial 2009 restructuring—and finally putting the case to rest last year—the bond insurer’s lawyers at Kasowitz Benson Torres & Friedman won a ruling this week that puts Lloyd’s of London and other underwriters on the hook for a hefty portion of MBIA’s defense tab.
In a 32-page decision, U.S. District Judge Shira Scheindlin in Manhattan ruled Wednesday that Lloyd’s, Lexington Insurance Company and Wurttembergische Versicherung AG are obligated to pay MBIA a combined $30 million. Scheindlin rejected the insurers’ argument that MBIA’s indemnification policies, which cover legal fees and expenses for claims relating to “professional services,” don’t apply to the multibillion-dollar restructuring case.
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