News & Events

This week, Simpson Thacher won a reversal of summary judgment at the Second Circuit Court of Appeals for its client, Utica Mutual Insurance Company.  The trial court had held that the facultative reinsurance contract at issue capped all liabilities, including litigation expenses, at the indemnity coverage limit as a matter of law.  At Simpson Thacher’s urging, the Second Circuit panel distinguished 24 years of precedent, including a case from the New York Court of Appeals and the longstanding Second Circuit decision in Bellefonte Reinsurance Co. v. Aetna Casualty & Surety Co., 903 F.2d 910 (2d Cir. 1990), to hold that the reinsurance contract’s liability limits must be interpreted according to the contractual terms and the intent of the parties.  The panel unanimously adopted Simpson Thacher’s argument that material differences between the Utica Mutual contract and the contracts in previous cases required reversal.  The case was remanded to permit Utica Mutual to develop extrinsic evidence regarding the intent of the parties, prior course of dealing, and industry custom and practice.

The Simpson Thacher team for the case consisted of Mary Kay Vyskocil, who argued the appeal and Jonathan S. Zelig.