Banks, Financial

Banking app targets millennials who want help budgeting

Graduate debt, rent and high living costs have made it hard for millennials to save for a house, a pension or even a holiday. For Ollie Purdue, a 23-year-old law graduate, this was reason enough to launch Loot, a banking app targeted at tech-dependent 20-somethings who want help to manage their money and avoid falling […]

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Eurozone inflation climbs to highest since April 2014

A welcome dose of good news before next week’s big European Central Bank meeting. Year on year inflation in the eurozone has climbed to its best rate since April 2014 this month, accelerating to 0.6 per cent from 0.5 per cent on the back of the rising cost of services and the fading effect of […]

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Wealth manager Brewin Dolphin hit by restructuring costs

Profits at wealth manager Brewin Dolphin were hit by restructuring costs as the company continued to shift its focus towards portfolio management. The FTSE 250 company reported pre-tax profits of £50.1m in the year to September 30, down 17.9 per cent from £61m the previous year. Finance director Andrew Westenberger said its 2015 figure was […]

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Travis Perkins and Polymetal to lose out in FTSE 100 reshuffle

Builders’ merchant Travis Perkins and mining company Polymetal face relegation from the FTSE 100 after their recent performances were hit by political events. The share price of Travis Perkins has dropped 29 per cent since the UK voted to leave the EU in June, as economic uncertainty has sparked concerns among some investors about the […]

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RBS share drop accelerates on stress test flop

Stressed. Shares in Royal Bank of Scotland have accelerated their losses this morning, falling over 4.5 per cent after the state-backed lender came in bottom of the heap in the Bank of England’s latest stress tests. RBS failed the toughest ever stress tests carried out by the BoE, with results this morning showing the lender’s […]

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Categorized | Insurance

Aviva files lawsuit over Dewey collapse

Posted on December 18, 2012

The fallout from the bankruptcy of Dewey & LeBoeuf has escalated after Aviva accused former senior executives at the law firm of misrepresenting its financial position before the insurer lent it money.

In a lawsuit filed in Iowa, where the US arm of the UK insurer is based, Aviva alleged Dewey had provided it with “false and misleading statements” that the three top officers “knew or should have known were deceptive”.

    Aviva, which bought $35m in senior secured notes in April 2010, said the defendants had assured them Dewey was financially sound when it was in fact “dire”.

    In particular, Aviva complained they hid remuneration that Dewey owed to some of its partners.

    The law firm had handed out multimillion-dollar guarantees to attract so-called rainmakers that would bring their books of business to Dewey. But it was unable to fulfil its obligations.

    Dewey & LeBoeuf filed for Chapter 11 bankruptcy protection in May, the biggest collapse of a US law firm by any measure. Former partners have filed other lawsuits relating to its collapse.

    Aviva’s law suit named Steven Davis, former chairman, Stephen DiCarmine, former executive director, and Joel Sanders, former chief financial officer, as defendants.

    Ned Bassen, partner at Hughes Hubbard & Reed, who represents Mr Sanders and Mr DiCarmine, said: “The lawsuit is frivolous. The insurance company purchased the notes from the law firm of Dewey & LeBoeuf LLP but has bypassed bringing a claim against the law firm in New York bankruptcy court to, instead, sue three individuals in Iowa . . . The lawsuit’s allegations are false and rely on second- or third-hand purported information, even media statements. This equates to legal muckraking.”

    Kevin T Van Wart of Kirkland & Ellis, who represents Mr Davis, said: “Aviva is a sophisticated entity that knew what it was doing. Rather than take responsibility for an investment decision that soured, it is looking for someone else to blame and resorting to revisionist history.”

    He added: “To the extent that Aviva has a claim, it is really a claim against the Dewey & LeBoeuf estate and belongs in the bankruptcy court.”