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September 2, 2010 |
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| January 04, 2010 |
By: Jordana Mishory |
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azorback Funding claims it sunk $32 million into disbarred attorney Scott Rothstein’s alleged Ponzi scheme through investment firm Banyon. Now the Broward County-based limited liability company seeks to recoup its losses by making claims on Banyon’s insurance policies.
Razorback sued Banyon’s six insurance companies in Broward Circuit Court, alleging the companies have rejected a Nov. 19 claim under the crime policy of the insurance.
“The insurance companies have taken the position that Razorback has no rights under the policy and have refused to acknowledge Razorback’s proof of claim or pay the claim,” said the lawsuit filed Dec. 30 by Conrad & Scherer attorneys William Scherer and Reid Cocalis.
But Razorback claims it is an intended third-party beneficiary of contracts between Banyon and its insurance companies. Razorback sued Federal Insurance, St. Paul Fire and Marine Insurance, RLI Insurance, Continental Casualty, Westchester Fire Insurance and Ironshore Indemnity for breach of contract. The lawsuit contends Razorback is covered because Rothstein’s law firm, Rothstein Rosenfedlt Adler, was an agent of Banyon investment funds.
The lawsuit said the policies range from $5 million to $40 million.
Razorback also sued Jacksonville-based risk management company Harden & Associates for negligence, claiming it should have recommended insurance that provided greater protection.
Razorback is one of eight plaintiffs in a fraud suit filed in November claiming combined losses of more than $100 million against Banyon Investment Fund and its principal, George Levin, claiming the fund served as a feeder for Rothstein’s alleged $1.2 billion Ponzi scheme based on structured settlements. That lawsuit, also filed by Scherer, names Rothstein, several colleagues, TD Bank and bank employees.
Scherer and Cocalis could not be reached for comment by deadline.
Jordana Mishory can be reached at (954) 468-2616.
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