Rehabilitator's Suit Against Reinsurers to Remain in Federal Court

CHICAGO - An Illinois federal judge has refused to remand a suit brought by the rehabilitator of Centaur Insurance Co., ruling that the state law issues pertaining to the rehabilitation proceedings do not specifically relate to the business of insurance. McRaith v. Munich Reinsurance America Inc., et al., No. 09-04027 (N.D. Ill.).

Judge John F. Grady of the U.S. District Court for the Northern District of Illinois further ruled that the dispute does not involve "complex state regulations pertaining to insolvent insurers."

In June 2009, Illinois Insurance Director Michael T. McRaith, as the rehabilitator of Centaur Insurance Co., sued American …