Insurance Litigation & Counseling

• Secured a victory on behalf of the WTC Captive, the city of New York, and approximately 140 contractors before the United States Court of Appeals for the Second Circuit. The court reversed in part, and vacated and remanded in part, two district court orders interpreting the landmark settlement McDermott devised and negotiated of over 10,000 cases brought by 9/11 first responders. These orders had exposed our client to approximately $50 million in additional liabilities.
• Won summary judgment on behalf of the WTC Captive in a suit against the London Market that also insured debris removal work at Ground Zero. The WTC Captive argued that because the London Insurers breached their duty to defend, the WTC Captive wrongly incurred the costs of defending the City and nearly 140 of its contractors against over 10,000 personal injury claims. The court ordered the London Insurers to reimburse the WTC Captive for past costs and to defend prospectively the city and its contractors. After appellate argument in the 2nd Circuit, Special Masters appointed by the US District Court for the Southern District of New York revealed that our client recovered “in the neighborhood of $200 million” through this settlement.
• Represented the Joint Liquidators of EMLICO, a Bermuda-based captive insurer, in evaluating and valuing a $4 billion claim for environmental liabilities by its insured, General Electric, involving 533 sites in nearly all fifty US states. The US District Court for the Southern District of New York reached the following conclusions with respect to McDermott’s work:
  In order to try and avoid extremely protracted and costly litigation, the Joint Liquidators devoted a great deal of effort toward settlement. This included, most importantly, settlement with reinsurers. In making this attempt, the Joint Liquidators were only exercising ordinary prudence. They selected a well-qualified Washington DC lawyer, Margaret Warner, who proceeded to amass information about the various sites, and to provide a forum where the interested parties could lay out their positions regarding insurance coverage, including all possible defenses available to EMLICO and to the reinsurers. This process proved to be enormously beneficial. The information Warner gathered was passed on to reinsurers, who appointed counsel and experts. The result was that all reinsurers entered into settlements except for Commercial Union and two small reinsurers. The settlements involved hundreds of millions of dollars, and were without question a remarkable achievement on the part of the Joint Liquidators and Warner.

Commercial Union Ins. Co. v. Lines, slip op., 2008 WL 2234634, *4 (S.D.N.Y. May 30, 2008).

• Served as National Coordinating Coverage Counsel for Continental Insurance Company and, after its acquisition, CNA Insurance for 14 years. Served as Continental’s lead trial counsel on seven of its largest jury trials involving insurance coverage disputes.
• Served as lead trial counsel for CNA Insurance and more than 20 other insurers in a four-and-a-half-month jury trial. The dispute concerned numerous insurance coverage issues arising from silicone gel breast implant products liability litigation.
• Represented The Church Insurance Company with respect to insurance coverage, fraud and bad faith litigation arising out of a $105 million judgment against its policyholder, a private high school in Charleston, South Carolina, in favor of the father of a boy who alleged some 800 instances of childhood sexual abuse while he was a student at the school. McDermott’s defense and successful resolution of the coverage action was followed by the insurer’s settlement of approximately 55 plaintiffs’ childhood sexual claims. Also served as national coordinating counsel for this insurer regarding insurance coverage and reinsurance issues arising from the Episcopal Church, dioceses and programs nationwide.
• Represent the National Basketball Association and National Hockey League in negotiating and documenting their league-wide temporary total disability insurance programs. The programs protect teams if their most highly compensated players become disabled. McDermott also advises the leagues on claims and other administrative issues arising under the programs.
• Represented Fireman’s Fund Insurance Company with respect to a multi-state investigation of contingent commission practices in the insurance brokerage industry, as well as in multi-district litigation in seeking the return of premiums paid by policyholders affected by contingent commission practices.
• Completed the comprehensive review and drafting of revised professional liability and general liability policy forms for multiple health care industry risk retention groups.
• Advise a host of corporate policyholders and individual directors and officers on D&O insurance issues, including but not limited to the review, negotiation and placement of policy forms at the time of purchase or renewal; insurance coverage analysis and claim submission; and the navigation of insurance coverage issues related to corporate transactions and bankruptcies.
• Advise corporate and private equity policyholders on the negotiation and placement of representations and warranties insurance and other transactional insurance products, including tax liability insurance. McDermott also assists clients on the submission and resolution of claims under these policy lines.

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