Quinn Emanuel Urquhart & Sullivan has been ordered by a federal judge to disclose an insurance policy pertaining to a $185 million legal fee. This ruling opens up an intriguing area of litigation finance, known as judgment preservation insurance, for further scrutiny.
The pronouncement occurred after an appeals court reversed Quinn Emanuel’s legal fee last year, instructing a federal judge to recalculate the award. The fee encompassed 5% of the billions of dollars the law firm secured for health insurers impacted by Congress’s decision not to fund a proportion of Obamacare.
A group of health insurers that opposed the fee contended Quinn Emanuel ought to disclose the policy to ascertain the receipt of any potential payment if the nine-figure award is reduced. However, their request for an exhaustive account of the funds, which they claimed had been distributed to Quinn Emanuel partners, was denied by the judge. She affirmed that Quinn Emanuel would likely refund any portion of the fee it may owe.
The court has not yet decided if the fee will be diminished. No comment has been released from lawyers for Quinn Emanuel and the objectors regarding this matter.
At the core of this issue is the judgment preservation insurance, or JPI, policy. This type of insurance is generally employed by parties anticipating large legal awards, safeguarding a fraction of the award from being reversed on appeal.
“JPI’s terms may be germane to the court’s job on remand if the policy clauses don’t align with the court’s objective ‘to ensure an overall fee that is fair for counsel and equitable within the class,'” US District Judge Kathryn Davis noted.
Though vigorously marketed by insurance brokers and touted as gaining traction, few specifics of such policies have ever been public. The objectors in the case have been ordered to respond to Quinn Emanuel’s latest motion to approve the fee request by March 5. This submission could reveal some particulars of the insurance arrangement.
This litigation stems from the case Health Republic Insurance Co. v. The United States, Fed. Cl., 16 259, 1/30/24 found here.