PracticeAccounting FirmsKBP files lawsuit against Royal & Sun Alliance

KBP files lawsuit against Royal & Sun Alliance

Administrators at Kroll Buchler Phillips have filed a lawsuit against insurer Royal & Sun Alliance on behalf of Turner & Newall, a subsidiary of bankrupt US engineering giant Federal Mogul.

Link: ‘Federal Mogul collapse distorts the truth’

A preliminary hearing on the lawsuit, expected to go to trial next January, took place at the beginning of last week. The administrators allege RSA is liable to pay compensation to an undisclosed number of former T&N employees suffering from asbestos-related diseases.

Federal Mogul filed for Chapter 11 bankruptcy protection in October 2001 after revealing a massive number of lawsuits amounting to around £1.2bn filed against it.

T&N also purchased a £500m layer of insurance against asbestos liability which will be triggered if claims filed after 30 June 30 1996 exceed £690m, according to trade journal Insurance Day.

On Friday, RSA’s shares plunged by 14% to 100.25p on news of the lawsuit.

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