Marsh sues Alliant in 5th
Marsh & McLennan Cos Inc said on Thursday it had sued insurance broker Alliant Insurance Services Inc, accusing it of improperly steering clients to Marsh's competitors and lying about the scope of its relationship with the insurer.
The case, filed in Los Angeles Superior Court, centers on Marsh's claims that Alliant, which was founded by former Marsh executives, had improperly taken business and disparaged Marsh to clients and competitors.
Marsh said in the lawsuit that Alliant, which is the largest non-brokerage insurance broker in the United States, had been "stealing" Marsh's business and clients since 1999, when five Marsh executives, including its former president and chief operating officer, left to start Alliant.
Marsh said Alliant had also made false statements about the scope of its relationship with Marsh, and had lied about the extent of its use of Marsh's proprietary information.
Marsh said in the lawsuit that Alliant's actions had damaged its business and damaged its relationships with clients and competitors.
Marsh is seeking unspecified damages and an order requiring Alliant to stop its allegedly improper activities.
Shares of Marsh & McLennan fell 76 cents, or 2.4 percent, to $30.69 in New York Stock Exchange trading on Thursday.
Other news in insurance
- Axa SA said on Thursday it had reached a deal with French insurance regulator ACPR to buy a 78.5 percent stake in Credit Lyonnais's insurance subsidiary.
- Standard & Poor's said on Thursday it had downgraded its credit rating for New York Life Insurance Company to A+ from AA-.
“The fact that Alliant would engage in such egregious conduct, particularly against a competitor, is a clear indication of the depths of their desperation to succeed.”
The case has been assigned to Judge William C. Pile.
Legal experts said the lawsuit was a significant development in the insurance industry, as it highlighted the intense competition and aggressive tactics used by some insurance brokers.
“This lawsuit is a classic example of a company trying to protect its turf and its business relationships,” said Randall Kelman, a partner at law firm Quinn Emanuel Urquhart & Sullivan.
“Marsh is saying that Alliant is improperly taking its business and clients, and that Alliant is lying about the scope of its relationship with Marsh,” Kelman said.
Author's summary:
Marsh & McLennan sues Alliant Insurance Services for allegedly stealing clients, making false statements, and lying about the scope of their relationship. The case highlights the intense competition and aggressive tactics used by some insurance brokers in the industry.