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CLEVELANDA surplus lines unit of American International Group Inc. is suing underwriting rival Catlin Inc. for allegedly poaching seven employees from offices in Connecticut and Ohio.
AIG's A.I. Risk Specialists Insurance Inc., a managing general underwriter for Lexington Insurance Co., filed the suit last week in U.S. District Court in Cleveland against Catlin and the seven former officials of SRO Napa, an underwriting agency that RSI acquired last month.
RSI charges that the seven conspired with Catlin to copy confidential SRO Napa underwriting files and use them to solicit their former accounts.
A Catlin spokesman declined to comment.
Until last month, SRO Napa was owned by Toronto-based Fairfax Financial Holdings Ltd. and underwrote excess casualty and surplus lines business for units of Hannover Reinsurance Co. of Germany, the complaint says. SRO Napa had 33 employees in offices in Napa, Calif.; North Olmsted, Ohio; and West Hartford, Conn.
In January, Donn Belzer and Grace Fortune, the top underwriting officers in the Ohio and Connecticut branches, respectively, quit to join Catlin.
Within two weeks, eight other underwriting employees followed, leaving the two SRO Napa offices with a total of three employees, the complaint says.
The RSI lawsuit names Mr. Belzer, Ms. Fortune and five of the other eight employees who quit.
According to the complaint, all seven of the named former SRO Napa employees downloaded confidential computer files in the days before they quit, including underwriting files and lists of policies up for renewal and those being nonrenewed. The defendants took this information to Catlin and have used it to solicit SRO Napa business, RSI charges.
The suit charges Catlin and the seven former SRO Napa officials with misappropriation of trade secrets and conspiracy. It also charges the ex-employees with breach of contract and fiduciary duty.
RSI has asked the court for orders barring the defendants from using the alleged trade secrets and requiring them to return information taken from SRO Napa and to stop soliciting SRO Napa accounts.
Mr. Belzer and Ms. Fortune could not be reached for comment.