LLOYD'S of London was braced last night for a possible ruling in a crucial US court case, which threatens at the last minute to upset a recovery plan for the 300 year old insurance market. Tens of thousands of investors in Lloyd's worldwide, including Irish names, are anxiously awaiting the outcome of the case in Virginia, where US investors (Names) have applied for an injunction to stop the recovery plan in its tracks.
Under its rescue proposals, Lloyd's is to reinsure billions of pounds in liabilities, including pollution and asbestosis related claims in the US, into a new company called Equitas. Names have only eight days left in which to accept or reject this plan, on which the future of the market hangs.
A last ditch attempt at securing more favourable treatment by a British based action group floundered last week, when the High Court threw out a case for judicial review of the plan.
But in the US, Lloyd's has for several years faced a giant raft of litigation. This latest challenge by 100 American Names contends that Lloyd's has breached US disclosure laws.
