Willis Dismisses Swiss Re Allegations

By E.E. Mazier

NU Online News Service, May 9, 4:30 p.m.EST?The notion that the attorneys of World Trade Centerleaseholder Silverstein Properties unduly pressured insurancebroker Willis Group Holdings Inc. into supporting the Silversteintwo-insurable-events theory is "laughable and reprehensible,"according to a Willis representative.

The allegation, made by Swiss Re in federal district courtmotion papers filed May 3 but revealed yesterday, is the latestsalvo in the fight over coverage issues stemming from the Sept. 11attack's toppling of the Twin Towers.

A Swiss Re unit--SR International Business Insurance CompanyLtd.--is faced with real estate developer Larry Silverstein's $7billion insurance claim against various layers of insurers.

The allegation also is part of Swiss Re's attempt to defeat thepurported "joint interest" privilege asserted by the Silversteinparties on behalf of their broker, Willis.

But a Willis representative said that Swiss Re's allegations donot change anything as far as Willis is concerned. "We have statedall along that this is a matter for the courts to settle based onthe available contracts," said a Willis representative, adding thatWillis therefore takes no position on the issue and has no interestin the litigation.

Swiss Re has asked the federal district court in Manhattan torequire the production of "highly-relevant facts surroundingSilverstein's post-loss reinvention of the WTC insurance coverageplacement history."

Jacques Dubois, chairman of Swiss Re America Holding Corp., saidit has become "obvious" that the two-occurrence "confection isnothing but a post-loss creation" by Mr. Silverstein and hisattorneys that "bears no relation to the actual placement history"of the insurance.

Swiss Re is arguing that there is no common legal interestbetween various Silverstein parties and Willis, which foreclosesthe invocation of the common-interest doctrine.

Swiss Re also has pointed out that the privilege asserted by theSilverstein parties on behalf of Willis does not apply becauseWillis is neither a party to the Swiss Re-Silverstein lawsuit, noris it a client of Mr. Silverstein's attorneys.

Also, Swiss Re is claiming that because Willis is not an agentof the Silverstein parties, neither can claim attorney-clientprivilege or the related work-product doctrine privilege.

According to the Swiss Re motion papers, the Silverstein partieshave tried to invoke the various privileges to keep Willis fromrevealing in depositions certain facts surrounding the allegedconcoction of the two-occurrence theory.

Swiss Re said the theory directly contradicts Willis's earlierconcession that the Sept. 11 events constituted only one insurableoccurrence as per the controlling insurance documents.