Insurance Funds Another Big Law Settlement, Ending 'A Cautionary Tale'
Even without a revealing trial, the contours of the dispute between UnitedLex and a bankruptcy trustee for LeClairRyan give law firms and new law providers guideposts for do's and don'ts when collaborating.
I’m not going to say I was looking forward to the trial that would determine whether the bankruptcy trustee for defunct Am Law 200 firm LeClairRyan could recover $128 million from UnitedLex, in the fight over the new law provider’s culpability for the firm’s collapse.
As a former litigation reporter, I’m well aware of how tedious the testimony in these kinds of disputes can be. But now that the parties have settled, there is something potentially lost in not being able to see the full details of the failed outsourcing partnership between LeClairRyan and UnitedLex revealed under the microscope of a trial.
The publication Richmond Biz Sense was the first to report that a $21 million settlement was revealed in open court in April. As for the insurance implications of this sizable settlement, the largest chunk would be $12.25 million in insurance proceeds from a policy through CNA that covered UnitedLex. An additional $500,000 would be paid out from another insurance policy provided by Travelers Insurance Co. The insurers will be responsible for paying the entirety of what they owe upon closing of the settlement.
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