Sunday, August 26, 2007

Law Society of Scotland insurer Marsh being sued by business rival over staff poaching

Marsh Inc, which through it's UK Subsidiary Marsh UK, handles the Law Society of Scotland's Master Insurance Professional Indemnity Fund - better known as the killer of clients claims against negligent & corrupt solicitors, is being sued by Willis & United amid allegations of 'staff poaching'.

Perhaps they have been learning a few naughty tricks from Drumsheugh Gardens ?

The Times Reports :

Writs fly as insurance firms fall out

Grant Ringshaw

MARSH, the world’s largest insurance broker, has become embroiled in a legal battle with rivals Willis and United Insurance Brokers.

The allegations centre on claims that some senior executives at Marsh’s aviation division in London were involved in a plot to poach staff and business from high-profile airline clients.

Willis alleges that Michael Moran, a former head of African aviation, sought to recruit staff for Marsh from the middle of last year in breach of his contract while still employed by the firm.

Willis has also alleged that Moran, who resigned from the company at the start of the year, passed confidential information, including thousands of files, to two Marsh executives, Nicholas Vine and Mark Church, managing directors at the group’s UK aviation and aerospace division. The information included documents about insurance business with Air Zimbabwe and South African Airways, two Willis clients. Marsh later withdrew its job offer to Moran.

Marsh has denied the allegations and is counter-suing Willis. Marsh alleges that Mark Goddard, a former senior vice president at the company, who left in 2004 to join Willis, passed confidential records to its rival about airline customers.

The claim accuses Willis and Goddard of a “conspiracy” to “use unlawful means to acquire clients of Marsh”.

The legal struggle between the two insurance-broking firms comes as it emerged that United Insurance Brokers (UIB), a smaller rival, is also suing Marsh. UIB alleges that Vine, the head of its aviation division until October 2004, breached his contract by attempting to negotiate “some form of team move” from UIB to Marsh.

UIB’s claim in the High Court alleges that Vine also passed confidential information about its business to Marsh including details of a bid for a key contract with Pakistan International Airlines (PIA). The writ claims that the information led to Marsh making an identical bid for the PIA account. As a result, the two companies were appointed as joint brokers to the airline.

Bassem Kabban, the UIB chief executive, wrote to Bruce Carne-gie-Brown, the then Marsh UK chief executive, in October 2004 to complain that Vine was attempting to take other UIB staff with him to the rival. Within days UIB said it sacked Vine for gross misconduct. Vine joined Marsh in November 2004.

UIB is suing for £2.5m covering damages, loss of business and legal costs. Marsh and Willis have not given details of the size of their claims.

Marsh, which is contesting the allegations, declined to comment on the cases. UIB and Willis also refused to comment.

The legal battle comes at a sensitive time for large insurance brokers, which have been attempting to rebuild their reputation after the industry was targeted by Eliot Spitzer, the former New York state attorney general, in an investigation in 2004 into alleged anticompetitive practices over commissions.

The Spitzer probe, which sent shock waves through the industry, has led to fierce competition and pressure on margins. However, aviation remains one of the more profitable areas.

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