PGIC’s Motion to Compel Production Denied in Reinsurance Dispute

BOSTON — A Massachusetts federal judge has ruled that the attorney-client privilege applies to documents containing third-party communications involving counsel for SPARTA Insurance Co., and therefore denied Pennsylvania Insurance Co. (PGIC)’s motion to compel production.

In an April 5 order, Chief Judge F. Dennis Saylor of the U.S. District Court for the District of Massachusetts also ruled that the common interest doctrine applies to corporate documents related to SPARTA’s acquisition of and American Employers Insurance Co. (AEIC), corporate governance, and its preparation of regulatory filings.

In June 2005, PGIC and AEIC entered into a reinsurance agreement, under which AEIC’s liabilities …