Firm Helps Defeat Effort to Delay Trial Due to Insurer’s Insolvency

By September 12, 2014February 10th, 2020Court Decisions, Press Releases

A Texas court has declined to stay a jury trial in a personal-injury case based on a Delaware court’s liquidation and injunction order concerning the defendants’ insurer.

Indemnity Insurance Corporation RRC insured the defendants and funded their defense. The trial court, however, stayed the case after a Delaware court issued a rehabilitation order placing the defendants’ insurer into receivership. When the Delaware court later ordered liquidation, the Texas defendants sought to extend the stay. The defendants claimed that the second Delaware order—which enjoined prosecution of any action in which the insurer was obligated to defend a party under its insurance contract—should be enforced in Texas based on full-faith-and-credit and comity principles.

Plaintiff’s counsel engaged Smith Law Group, P.C. to help oppose the defendants’ second motion. After extensive briefing prepared by Maitreya Tomlinson, the trial court denied the motion, thereby allowing the case to proceed to trial against the defendants regardless of their Delaware insurer’s status.

Perez v. Rick’s Cabaret Int’l, Inc., et al., Cause No. C-4279-F in the 332nd Judicial District Court of Hidalgo County, Texas