Brit Insurance faces a House of Lords battle in March as Grant Thornton International attempts to force the insurer to pay out on the firm’s cover in relation to Parmalat.

The international network had been denied cover in an earlier court case, because its former Italian member firm, Italaudit, did not claim under the policy.

The case is the latest in the ongoing fallout from Parmalat’s collapse, as investment banks face charges in Milan over their involvement in the company’s collapse.
The GT network was treated as a member of the firm’s policy, but because the Italian branch failed to disclose litigation with Parmalat, Brit refused to cover GTI.

The Parmalat scandal hit the headlines again this year as Deloitte’s €76m (£57m) settlement proposal was put forward to Parmalat bondholders, and the trial began against four investment banks over their role in its collapse. Citigroup, Deutsche Bank, UBS and Morgan Stanley face trial in Milan after continuing to lend to the group as it collapsed.

Last year a US judge threw out claims against the auditors and bankers of Parmalat. Judge Lewis Kaplan said that the majority of the alleged wrongdoing attributed to the banks and auditors occurred outside the jurisdiction of the US, so the defendants did not have to face charges.

Judge Kaplan had already thrown out cases against Deloitte & Touche’s US and Italian units, GTI’s US business, Bank of America, Italy’s Banca Nazionale del Lavoro SpA, and units of Credit Suisse Group.

The failed cases were brought by the administrator for Parmalat USA and the litigation trustee for its Farmland dairies unit, both former US subsidiaries of Parmalat.