Represented by Robin Cohen, Adam Ziffer, and Meredith Elkins of insurance recovery law firm Cohen Ziffer Frenchman & McKenna LLP, Dellwood filed its motion to dismiss on July 31, requesting that all counts be dismissed with prejudice, after AIG dropped Michael Price, Kean Driscoll, and Thomas Connolly as individual defendants.
When AIG amended its complaint to exclude the trio – former AIG executives now leading Dellwood – the reasoning was to avoid delays in case they opted to take the case into arbitration. Dellwood, in its motion to dismiss, argued that by voluntarily dismissing the action against the three with prejudice, AIG achieved an adjudication on the merits of its claims against Dellwood.
The recently launched (March 7, 2024) business also wanted the case dismissed on the basis that, among other things, AIG’s amended complaint “does not plausibly plead claims” against the excess and surplus (E&S) insurance startup.
Now, in a brief filed on September 11, AIG argued: “AIG’s First Amended Complaint (the ‘FAC’) lays out a detailed account of Dellwood’s wrongdoing that more than plausibly states the claims alleged. As described in the FAC, Dellwood’s own website makes clear that Dellwood’s E&S business plan is to copy AIG’s E&S business plan.
“The FAC, moreover, details how Dellwood went well beyond that by taking AIG’s Confidential Information, including trade secrets, and inducing AIG’s current and former employees to breach their fiduciary and contractual obligations to enable Dellwood to get off the ground.”
The court filing goes on to read: “While the full extent of Dellwood’s theft will not be known until discovery concludes, it is already clear that Dellwood used its current chief financial officer, Thomas Connolly, as a mole within AIG for that purpose.
“AIG’s investigation has already determined that while Connolly was still on AIG’s payroll, he was drafting business plans for Dellwood, and that he did so using AIG’s Confidential Information and business plans… which he emailed to himself from his AIG email account.”
Citing post-employment restrictive covenants, the major insurer also argued that the FAC provides “ample detail” with respect to Dellwood’s alleged inducement of the trio to breach their non-competition, non-solicitation, non-disclosure, and garden leave obligations to AIG.
Price, chief executive of Dellwood, was CEO of North America general insurance at AIG before his separation from the firm on June 30, 2023. Driscoll, Dellwood president and chief underwriting officer, separated from AIG on March 3, 2024, after last serving as global CUO of general insurance. Connolly, who was AIG’s chief financial officer for North America general insurance, separated from the group on March 15, 2024, and now serves as CFO and treasurer at Dellwood.
Meanwhile AIG’s camp also stated: “Apparently hoping to avoid the undeniable sufficiency of AIG’s allegations, Dellwood strains to argue that the res judicata doctrine requires dismissal of the entire complaint against Dellwood because AIG voluntarily dismissed the claims it had asserted in this case against the Former Executives (after they signaled an intent to force this case into arbitration, and thereby avoid the comprehensive discovery afforded by the Federal Rules of Civil Procedure and a public accounting for their misconduct).
“That argument fails, however, because res judicata only affords judgments preclusive effect in subsequent cases; it cannot be used, as Dellwood attempts to do here, to bar claims asserted in the same case.”
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