• February 16, 2010

“Enormous Changes at the Last Minute” is the title of a collection of superb short stories by Grace Paley.  Reversals in litigation often bring the title to mind.

Granted, in litigation, very little comes down to a matter of minutes (with exceptions from time to time), but the point is that litigation can be “flipped” by a single ruling, of course — the celebrating victor transformed into resounding defeat, the fighter facing an overwhelming barrage suddenly towering over the fallen adversary.  (This should teach humility (or perseverance) and certainly keeps life interesting.)

In late August, in high stakes insurance coverage litigation between UnitedHealth Group and a gaggle of insurers (feel free to insert your own favorite “animal group” name if you like (a “knot of insurers”?)), Mag. Judge Susan Richard Nelson issued a Report & Recommendation recommending the denial of defendants’ motion to dismiss in its entirety.  Last week, however, U.S. District Court Judge Patrick Schiltz (D. Minn.), on de novo review, saw matters quite differently.  While not granting the insurers’ motions in their entirety, he ruled that they need not insure the huge bulk of some $400 million in payments that UHG is obligated to pay to settle litigation related underlying health insurance coverage terms (except for portions awarded for plaintiffs’ attorneys fees that would no doubt be substantial but a relatively small fraction of the overall settlements).

Since Judge Schiltz did not grant the motions in their entirety, the defendant insurers were not awarded judgment so an appeal, if there is to be one, will have to wait.  An appeal could, of course, result in yet another enormous change.  The Eighth Circuit would have the benefit of Mag. Judge Nelson’s 28-page R&R and Judge Schiltz’s 50-page de novo analysis to help them parse the issues of New York insurance law.

Leave a Reply

Your email address will not be published. Required fields are marked *