PADI getting sued over Insurance Program

[Jim Lapenta]

Smoke and mirrors comes to mind. Insurance renewal time is coming up in less than 2 months now for many. Wonder why the last release didn't mention any of this? Willis and Witherspoon as well as any other liability companies may be looking at an influx of new business once this becomes more widely known.

 

[mdb]

How many sheep will re-up for another fleecing will be interesting.

 

[Thalassamania]

I predict that most all will, unless other carriers start to share the windfall.

 

[Brendon]

This was just sent to me by a friend this morning...

----In its DiveNewswire post last Thursday, PADI claimed “Good News For the Dive Industry and PADI members,” implying that the class action lawsuit arising from the questionable sale of PADI store insurance was over.
“That is absolutely not the case” says class action attorney Edwin Schreiber, who represents Kauai Scuba. “Last Monday, PADI’s attorneys were present in court when Federal District Judge David O. Carter set the trial of the matter for January 31, 2012 and set forth the full discovery schedule, including mediation.”
“Additionally, the documents already produced by PADI as part of the required disclosures have confirmed that the claims made in the class action suit are absolutely correct; in one year, for example, PADI purchased a property policy from Lexington Insurance for around $500,000, maintained a $300,000 self-insured retention to pay the claims of the member stores under that program, and apparently kept the rest of the premium that Vicencia & Buckley charged to PADI members (except for Vicencia & Buckley’s fees), which is estimated to have exceeded $2.2 million per year based on PADI’s own number of insured stores and an estimate of average premiums. Our basis for the claims in the suit remain unchanged; PADI store members who purchased this insurance thinking they were buying an insurance policy written by Lexington Insurance, were, in fact, putting their insurance claims in the hands of PADI itself, which is not an insurance company, and not properly licensed to accept the risk. Our requested remedy on behalf of these PADI members who had purchased this insurance thinking they were buying coverage from a legitimate insurance company is that PADI must return all of the premiums for this insurance that were collected under false pretenses from them, and we believe that with the disclosure of the documents our case has become considerably stronger.”
“How PADI could describe this scheme as ‘Good News For the Dive Industry and PADI members’ is beyond me, as the documents suggest that it was really just good news for PADI’s finances.” adds Schreiber. Class action attorneys Edwin and Eric Schreiber can be reached at ed@schreiberlawfirm.com, or eric@schreiberlawfirm.com
In another development last week, the State Bar of California rejected the Complaint filed by Al Hornsby on behalf of PADI against attorney Rick Lesser, stating that there were insufficient grounds for disciplinary action, and closed their file. Contrary also to PADI’s claims, Judge Carter apparently ruled that because in the past, Mr Lesser had worked to some extent on PADI’s insurance program, there was the possibility Mr Lesser had received confidential information, and, therefore, he could not continue to represent Kauai Scuba in this case.
The action will be vigorously continued by the Schreiber & Schreiber, Inc. law firm.----
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Anybody else get this?

 

[Thalassamania]

Yup, got it. Goes the level of PADI officers' historic honesty.

 

[Scott L]

PADI is going to get hammered IMO.

This was just sent to me by a friend this morning...

----In its DiveNewswire post last Thursday, PADI claimed “Good News For the Dive Industry and PADI members,” implying that the class action lawsuit arising from the questionable sale of PADI store insurance was over.
“That is absolutely not the case” says class action attorney Edwin Schreiber, who represents Kauai Scuba. “Last Monday, PADI’s attorneys were present in court when Federal District Judge David O. Carter set the trial of the matter for January 31, 2012 and set forth the full discovery schedule, including mediation.”
“Additionally, the documents already produced by PADI as part of the required disclosures have confirmed that the claims made in the class action suit are absolutely correct; in one year, for example, PADI purchased a property policy from Lexington Insurance for around $500,000, maintained a $300,000 self-insured retention to pay the claims of the member stores under that program, and apparently kept the rest of the premium that Vicencia & Buckley charged to PADI members (except for Vicencia & Buckley’s fees), which is estimated to have exceeded $2.2 million per year based on PADI’s own number of insured stores and an estimate of average premiums. Our basis for the claims in the suit remain unchanged; PADI store members who purchased this insurance thinking they were buying an insurance policy written by Lexington Insurance, were, in fact, putting their insurance claims in the hands of PADI itself, which is not an insurance company, and not properly licensed to accept the risk. Our requested remedy on behalf of these PADI members who had purchased this insurance thinking they were buying coverage from a legitimate insurance company is that PADI must return all of the premiums for this insurance that were collected under false pretenses from them, and we believe that with the disclosure of the documents our case has become considerably stronger.”
“How PADI could describe this scheme as ‘Good News For the Dive Industry and PADI members’ is beyond me, as the documents suggest that it was really just good news for PADI’s finances.” adds Schreiber. Class action attorneys Edwin and Eric Schreiber can be reached at ed@schreiberlawfirm.com, or eric@schreiberlawfirm.com
In another development last week, the State Bar of California rejected the Complaint filed by Al Hornsby on behalf of PADI against attorney Rick Lesser, stating that there were insufficient grounds for disciplinary action, and closed their file. Contrary also to PADI’s claims, Judge Carter apparently ruled that because in the past, Mr Lesser had worked to some extent on PADI’s insurance program, there was the possibility Mr Lesser had received confidential information, and, therefore, he could not continue to represent Kauai Scuba in this case.
The action will be vigorously continued by the Schreiber & Schreiber, Inc. law firm.----
-----------------------------------------------------------------------------------
Anybody else get this?

 

[Thalassamania]

PADI seems to get hammered each and every time, but somehow they slither out and escape from any real damage. This is the third (at least) suit that I know of that would have shut down (or at least shamed) any other organization.

 

[theduckguru]

Ok, all those who thought this was over weigh in.

 

[Scott L]

PADI seems to get hammered each and every time, but somehow they slither out and escape from any real damage. This is the third (at least) suit that I know of that would have shut down (or at least shamed) any other organization.

Thal, from reading previous threads about PADI's former litigation, Rick Lesser was their very adequate defense counsel much of the time. Now, that skill is is on the other side of the aisle. Your thoughts?

 

[djcheburashka]

Plaintiff here seems to be doing very well with issuing press releases, but otherwise losing every time they show up in court. Hmmm....