On Monday, convicted insurance magnate Gregory Lin Berg faced a fresh setback as the Fourth Circuit ruled that he is responsible to pay a $524 million arbitration award in a dispute over reinsurance arrangements.
The panel upheld the North Carolina district court’s summary judgment ruling in favor of Universal Life, concluding that guaranty agreement was clear on Lindberg’ s responsibility to cover PBLA’ s obligations. The panel praised the lower court’s ruling as ” well-reasoned.”
The dispute arose from a business accord entered into by Lindberg’ s company, Pacifc Bankclamation and Trust, with Universal Life. According that agreements, Lindberg was supposed to deposit Hundreds of millions of dollars into a trust to pay insurance clients and satisfy other regulatory obligations. However, Universal Life complains that Lindberg sank the money for personal use–including yachts, private planes and mansions in Switzerland or Russia.
After learning of Linderberg’s activities, Universal Life initiated arbitration and was awarded $524 million (in a decision confirmed by a New York federal court). It tried to enforce the award in North Carolina, where Lindberg’ s companies were based. However, despite many court orders demanding payment, Lindberg continued to appeal.
