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Pre-Answer Security: Regulatory Protection for Policyholders in an Age of Insecurity
When corporate policyholders sue their insurers, the roster of defendants often includes an “unauthorized” insurer, whether it be Lloyd's of London (which is licensed in only two states, though it writes as an eligible surplus lines insurer in some or all of the other states), a London Market Company, or a domestic insurer not licensed to sell insurance in the state where suit was brought. Such insurers have avoided many of the stringent state regulations that govern “authorized” insurers. But in the majority of states, those insurers are subject to a quid pro quo in exchange for enjoying relaxed regulation: Unauthorized insurers (whether foreign or domestic, “eligible” as surplus lines carriers or not) are subject to a pre-Answer security requirement. That is, before they may answer a Complaint against them, unauthorized insurers must post cash, securities, or a bond sufficient to satisfy any judgment that may be entered against them.
Although not a newly enacted requirement, the pre-Answer bond is often overlooked as policyholders and their insurers hurtle into fast-paced litigation. Because obtaining such a bond can be “good insurance” against either an insolvency or a post-judgment battle to collect, policyholders should consider enforcing their right to demand a bond when litigating against an unauthorized insurer. Indeed, this may be a rare instance in which policyholders and at least some of their insurers ' the authorized ones ' can agree, since in jurisdictions that apply the “all sums” rule a bond can help minimize the risk that the authorized insurers will be left paying the share of the judgment that would have been borne by the unauthorized insurer had the policyholder been able to collect it.
The Statutory Framework
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Removing Restrictive Covenants In New York
In Rockwell v. Despart, the New York Supreme Court, Third Department, recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land?