RAM IIC Demands $10 Million from Reinsurer for Ernst & Young Tax Lawsuits

NEW YORK - RAM IIC Inc. has accused Steadfast Insurance Co. of wrongfully refusing to pay a reinsurance claim submitted in connection with RAM’s $75 million settlement of suits brought against its insured, Ernst & Young, in connection with certain E&Y tax shelters.

In a complaint filed in the New York County Supreme Court, RAM accuses Steadfast of breaching a facultative reinsurance contract by denying its $10 million reinsurance claim.

Ernst & Young marketed and implemented tax strategies known as “CDS and CDS Add-On Strategies,” which sought to reduce, defer or eliminate taxes potentially owed by its clients. E&Y provided …