HOUSTON -- A Minnesota trucking company is suing an insurance firm, alleging deceptive insurance involving workers' compensation.
Stan Koch & Sons Trucking Inc., filed a lawsuit Sept. 18 in the Houston Division of the Southern District of Texas against Red Hawk, a reinsurance corporation based in the Cayman Islands.
According to the complaint, even though Koch & Sons Trucking was paying premiums for workers' compensation insurance to Red Hawk, the policy was placed with a different insurance company. The suit says the plaintiff discovered the second company had nothing to do with worker's compensation and it was was the defendant who underwrote, procured, managed, organized, sponsored and administered the program.
In spring 2013, the lawsuit states, the second insurance company entered rehabilitation in Delaware, and the defendant stopped all work on the plaintiff's workers' compensation claims. That is contrary to the contract in place, the suit says. In fact, the plaintiff alleges it has paid $2 million of its own money in worker's compensation claims.
The plaintiff seeks a declaratory judgment asking the court to discern who is who. It alleges breach of contract and conversion, several violations of Texas Insurance Code, breach of duty of good faith and fair dealing.
Stan Koch & Sons Trucking seeks exemplary damages, Texas Insurance Code damages and attorney fees. It also wants the defendant to pay the workers' compensation claims already filed, recovery of the claims it paid to its employees, actual damages of at least $2 million, court costs and a trial by jury. The plaintiff is represented by attorneys Greg K. Winslett and Richard L. Smith Jr. of Quilling, Selander, Lownds, Winslett & Moser PC in Dallas.
Houston Division of the Southern District of Texas Case number 4:15-cv-02716