UPDATE: Appeals Court Vacates Ruling Dismissing Hartford Suit
By Chad Bray Of DOW JONES NEWSWIRES NEW YORK -(Dow Jones)- A federal appeals court on Monday vacated a lower court's ruling dismissing a 2004 shareholder lawsuit against Hartford Financial Services Group Inc. (HIG) over so-called contingent commission relationships with insurance brokers.
In an opinion Monday, the Second Circuit Court of Appeals found the case wasn't barred by the statute of limitations and remanded it to the lower court for further proceedings. U.S. District Judge Christopher F. Droney in Hartford dismissed the case in 2006.
"We express no views about the merits of the other grounds for dismissal raised by appellees in their motion to dismiss, since the district court never reached them," wrote U.S. District Judge Colleen McMahon, who was sitting by designation.
The lawsuit had alleged investors acquired the company's stock at artificially inflated prices as a result of improper fees known as contingent commissions that were often paid to insurance brokers above their ordinary commission fees.
The shareholders claimed the fees were part of a kickback and bid-rigging scheme involving insurance brokers and Hartford paid the fees in order to increase its market share and artificially inflate its insurance prices.
In a statement, Hartford said the appellate court's decision addressed a preliminary, procedural motion to dismiss the case on statute of limitations grounds and there has been no decision on the merits of the allegations.
"The Hartford continues to believe those allegations are completely meritless," the company said.
-By Chad Bray, Dow Jones Newswires; 212-227-2017; chad.bray@dowjones.com
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(END) Dow Jones Newswires
November 17, 2008 17:56 ET (22:56 GMT)
Publié le 17 novembre 2008 Copyright © 2008 Dowjones
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