Lloyd's appeals over US ruling

Insurance market fights last-minute challenge to its pounds 15bn surviv al plan

Lloyd's of London yesterday lodged an urgent appeal against a landmark decision by a US federal judge, granting 2,700 US names an injunction to delay the insurance market's pounds 15bn survival plan.

The courtroom drama, in Richmond, Virginia, early yesterday morning, came as the final deadline looms for Lloyd's members to accept the market's Equitas package.

Names, as members are known, have until noon on Wednesday to accept the deal or face being excluded and pursued by Lloyd's for their debts.

This weekend, Lloyd's said the deadline would stand, regardless of the US decision. "Basically, we go ahead with the 28th August. People do have to be aware of the consequences of staying out," a Lloyd's spokeman warn- ed.

In his 11th-hour move, federal judge Robert Payne granted a preliminary injunction to US names that went far beyond their expectations.

In a 141-page decision, the judge ruled for the first time that Lloyd's was subject to US securities laws and ordered the market to provide full prospectus information, which it has so far declined, on Equitas.

He set Lloyd's a deadline of 23 September to comply, until when payments by any US names wishing to accept Equitas will be suspended in an "escrow fund".

The appeal will be heard early next week, and Lloyd's said it would pursue the case to the Supreme Court, if need be. So far Lloyd's has ridden a wave of court actions over pounds 8bn of losses suffered by its 33,500 names on catastrophe, pollution and asbestosis claims between 1987 and 1992.

UK names have won a series of actions against Lloyd's agents and auditors, which pushed the market into including a pounds 3.2bn settlement package in Equitas.

Only last month, it also thought it had bought off US state securities regulators by offering an extra pounds 40m to US names.

So far, too, the powerful federal Securities and Exchange Commission has sat on the fence, a stance US names last night said may have provoked the judge.

"Lloyd's is in violation of the Securities Exchange Act and ... in contravention of rules and regulations promulgated by the SEC," judge Payne said. His ruling came as Colorado's Attorney General also prepared to overrule the state's securities commission by taking action against Lloyd's under consumer protection laws.

The key New York prosecutor's office, however, said it had no plans to take action, despite Attorney General Dennis Vacco's intervention in Virginia, supporting US names' rights to sue in US rather than UK courts.

Lloyd's is hoping for up to pounds 320m in fresh money - pounds 66m from the US - from names, before it seeks final approval for Equitas from the Department of Trade and Industry after its ruling council meeting on Thursday. Yesterday, it said acceptances already exceeded expectations.

It intends to draw down on pounds 900m of names' funds at Lloyd's regardless, though pounds 100m of that belongs to US members and is now in doubt. As a contingency, it has already agreed a pounds 300m bank facility to the bridge any gap. A key part of the settlement, though, rests on getting enough of the 13,600 litigating names to stop court action.

This weekend, one US lawyer said the Virginia ruling might yet cause auditors, agents and broker with US activities to review their contributions to the deal.

News
Denny Miller in 1959 remake of Tarzan, the Ape Man
people
Arts and Entertainment
Cheryl despairs during the arena auditions
tvX Factor review: Drama as Cheryl and Simon spar over girl band

News
Piers Morgan tells Scots they might not have to suffer living on the same island as him if they vote ‘No’ to Scottish Independence
news
News
i100Exclusive interview with the British analyst who helped expose Bashar al-Assad's use of Sarin gas
PROMOTED VIDEO
Sport
Angel Di Maria celebrates his first goal for Manchester United against QPR
Football4-0 victory is team's first win under new manager Louis van Gaal
Arts and Entertainment
art
News
newsIn short, yes
Arts and Entertainment
Rob James-Collier, who plays under-butler Thomas Barrow, admitted to suffering sleepless nights over the Series 5 script
tv'Thomas comes right up to the abyss', says the actor
Arts and Entertainment
Calvin Harris claimed the top spot in this week's single charts
music
Sport
BoxingVideo: The incident happened in the very same ring as Tyson-Holyfield II 17 years ago
News
Groundskeeper Willie has backed Scottish independence in a new video
people
Arts and Entertainment
The Doctor poses the question of whether we are every truly alone in 'Listen'
tvReview: Possibly Steven Moffat's most terrifying episode to date
News
ebooksAn unforgettable anthology of contemporary reportage
News
i100
Life and Style
Cara Delevigne at the TopShop Unique show during London Fashion Week
fashion
News
The life-sized tribute to Amy Winehouse was designed by Scott Eaton and was erected at the Stables Market in Camden
peopleBut quite what the singer would have made of her new statue...
Sport
England's Andy Sullivan poses with his trophy and an astronaut after winning a trip to space
sport
News
peopleThe actress has agreed to host the Met Gala Ball - but not until 2015
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SQL Developer - Watford/NW London - £280 - £320 p/d - 6 months

£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Senior BA - Insurance **URGENT**

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Training Coordinator / Resource Planner - City, London

£35000 - £38000 per annum + Benefits: Ashdown Group: Training Coordinator / Pl...

Data Governance Manager (Solvency II) – Contract – Up to £450 daily rate, 6 month (may go Permanent)

£400 - £450 Per Day: Clearwater People Solutions Ltd: We are currently looking...

Day In a Page

These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week
The fall of Rome? Cash-strapped Italy accused of selling its soul to the highest bidder

The fall of Rome?

Italy's fears that corporate-sponsored restoration projects will lead to the Disneyfication of its cultural heritage
Glasgow girl made good

Glasgow girl made good

Kelly Macdonald was a waitress when she made Trainspotting. Now she’s taking Manhattan
Sequins ahoy as Strictly Come Dancing takes to the floor once more

Sequins ahoy as Strictly takes to the floor once more

Judy Murray, Frankie Bridge and co paired with dance partners
Wearable trainers and other sporty looks

Wearable trainers and other sporty looks

Alexander Wang pumps it up at New York Fashion Week
The landscape of my imagination

The landscape of my imagination

Author Kate Mosse on the place that taught her to tell stories