In a case that warns of consequences of undervaluing claims, a defense attorney rejected a $2 million settlement offer, was hit with a $28 million verdict, then settled with the plaintiffs for $10 million—a sum paid by the defendant’s first and second insurance company.

Now the U.S. Court of Appeals for the Fifth Circuit has given the green light for the secondary insurance company—it paid $8 million of the settlement—to recoup its money from the primary insurance company, arguing it had a duty to take a $2 million settlement offer that the plaintiffs made as the jury was deliberating.