P&W Persuades Federal Court to Defer to State-Court Actions

Posted by Bradford S. Purcell | Jul 02, 2015 | 0Comments

Mike Sanders, Tom Underwood, and R.J. VanSwol, working on behalf of an umbrella insurer, successfully stayed a forum-shopping federal action that another insurance group had filed to get away from a pending state-court declaratory action. After years of coverage litigation over an underlying lawsuit brought by an employee of the other insurers' named insured, the state court had found that our insured was an additional insured under the other insurers' policies. When the court in the underlying tort case entered a multimillion-dollar judgment against our insured, the other insurers filed a purported interpleader action in the Northern District of Illinois and deposited their limits of insurance there. We argued that the federal court should abstain because the same issues were already pending in state court. The federal judge agreed and stayed the interpleader action pending the resolution of the state-court matters.

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