American International Group and a group of its excess and surplus lines subsidiaries have dropped claims against three former AIG executives who launched Dellwood Insurance Group but its claims against the E&S lines insurer live on.
AIG earlier in May gave notice in U.S. District Court in New Jersey of its intent to drop the individual claims against Michael Price, Kean Driscoll and Thomas Connolly.
The trio launched Garden State-based Dellwood in early March with more than $250 million in capital and backed by RenaissanceRe, PartnerRe, Starr Insurance, and Central Insurance. The order of dismissal was filed May 29.
Price was AIG’s CEO of North America General Insurance before leaving the company at the end of June 2023. Driscoll was AIG’s global chief underwriting officer of General Insurance, and Connolly was formerly chief financial officer of AIG’s North America General Insurance. Both left AIG in March.
Price and Driscoll are now CEO and CUO, respectively, of Dellwood, formed for P/C wholesale brokers with eye on small- and middle-enterprise risks. Connolly is Dellwood’s CFO.
AIG said in a court filing that it chose to dismiss the claims against its former executives “to avoid unnecessary delays and costs” and to make sure its remaining claims against Dellwood remain in the District of New Jersey.
“AIG has engaged in a highly unusual move of dismissing with prejudice its own claims against Mr. Price, Mr. Driscoll and Mr. Connolly for one reason only,” a Dellwood spokesperson said in an email to Insurance Journal. “It knew that there was no factual basis for their claims and that such claims would likely be dismissed. Any suggestion otherwise is meritless.”
The defendants’ lawyers in mid-May filed a letter to the judge to request a conference to discuss dismissal of all claims. According to the letter, AIG in March sent a cease-and-desist notice to Price, Driscoll, and Connolly, alleging they violated agreements and fiduciary obligations by allegedly soliciting AIG employees and misappropriating trade secrets. The trio responded, saying that the allegations were baseless, and that they would not solicit any AIG employees or had any knowledge of confidential or proprietary information in their possession. They requested 30 days to investigate. AIG filed suit five days later.
“This litigation is an attempt by AIG – a $50 billion behemoth insurance company – to crush a fledgling startup, restrain the entrance of new capacity in the underserved market for small and medium sized businesses struggling to find adequate insurance, and punish Dellwood’s founders who had the entrepreneurial spirit and courage to set out on their own after years of faithful service to AIG. This is exemplified by the complaint’s kitchen-sink approach of asserting causes of action that are not legally cognizable, duplicative, and/or are legally insufficient,” said a lawyer for the defendants in the letter.
AIG’s suit, filed in early April, alleged Dellwood is “directly competitive” with AIG’s E&S insurers.
“AIG was at the forefront of a recent market trend of moving the E&S market from a dual distribution model to a wholesale-only model,” AIG said in the suit. “AIG developed its own unique and proprietary version of the contract bind process that eliminated the need for hiring a fleet of sophisticated underwriters, a substantial cost. Dellwood appears to have adopted that strategy and, on information and belief, intends to leverage the relevant expertise that Price, Driscoll, Connolly, and other former employees learned at AIG to develop a company that competes against AIG not only in the E&S market but in other segments as well.”
AIG seeks injunctive relief and damages.
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