E&S startup wants AIG suit tossed

A startup excess and surplus lines insurer launched by three former American International Group Inc. executives moved to dismiss AIG’s amended unfair competition lawsuit Wednesday, arguing the claims are “legally insufficient.”

Dellwood Insurance Group LLC said in its motion, filed in a federal court in Newark, New Jersey, that AIG and several subsidiaries do not state cognizable claims for breach of contract, breach of fiduciary duty, unfair competition and violations of the Computer Fraud and Abuse Act and Defending Trade Secret Act. The case is AIG et al. v. Dellwood Insurance Group LLC et al.

Summit, New Jersey-based Dellwood was launched March 7 by Michael Price, former CEO of North America General Insurance at AIG; Kean Driscoll, former global chief underwriting officer of AIG; and Thomas Connolly, former chief financial officer of North American Insurance.  

AIG sued Dellwood and the three former executives in April, claiming the individuals illegally used its proprietary information when launching the company and violated post-employment restrictive covenants. AIG later dismissed the individuals from the suit and filed an amended complaint asserting claims solely against Dellwood, court records show.

Dellwood said AIG’s “strategic maneuvering” of dismissing the individuals to avoid advancing defense costs backfired because the dismissal constituted a decision on the merits of the claims it brought in the amended complaint. As a result, Dellwood said the claims in the amended complaint are subject to the doctrine of res judicata, which bars a case from being relitigated.

Representatives for the parties did not respond to requests for comment.