Crain's Detroit Business - review of MSU civil liability
http://www.crainsdetroit.com/article/20180128/news/651331/long-complex-road-ahead-for-msu
Found this article from Sunday's Crain's Detroit Business.
There has been extensive conversation in other posts about the civil lawsuits. The article discusses what MSU may or may not try to do in order to reduce the financial penalty of Dr. Evil Nassar becoming the worst sexual predator in American history while acting as their employee.
As an aside:
This bullshit evil is really personal for me - my sister was an elite gymnast. She was ranked #20 in the country in the late 90s and was competing for a spot on the national team (she did not make it as they have fewer than 10). As such she hung around with all the olympic competitors from the late 90s. She was a college athelete afterwards (not at MSU). Abuse of this kind is an epidemic in gymnastics. My sister knows MANY people who are victims.
At the elite level, eveybody gets to know everybody after a year or two it seems. There is a bit of a alumnae club too. I know these women and I rage against what happened to them; I rage against the administration that simply didn't give a shit about the girls and women they were entrusted to protect (both MSU and USAG/USOC).
If judgment was left to me it would be simple: nuke it from space - it's the only way to be sure.
January 29th, 2018 at 11:53 AM ^
The tail end of the article touches on the potential impact to the taxpayer.
It's unfortunate what this could mean for the costs of an education for students.
It's worth also considering that these insurers know how flush a place like MSU is with all kinds of funds and access to donors. Once the victims are taken care of, there is nothing stopping insurers from seeking subrogation from the University and particular employees for any and all funds paid out under the policies.
It's not outlandish to consider the possibility that in the end every dime for costs of defense and settlements will come from the University.
Speculation, but I've seen insurance companies seek subrogation against dirt poor tenants ofor small claims court level damages for like a water leak at a rental property.
January 29th, 2018 at 12:04 PM ^
I don't think MSU's insurers can subrogate against their own insureds. They night raise coverage issues such as a failure to take steps against responsible employees once the administation was placed on notice of them. In other words, when you had no notice- those losses are covered, but once you had notice and allowed them to commit additional wrongs, those losses are not covered. This is based upon the principle that you have a duty to reduce future losses, once you are aware of the problem.
January 29th, 2018 at 12:20 PM ^
Yeah subrogation was a poor choice of words. My bad.
I guess I meant a cross claim filed by the insurer, pre or post settlement pay outs. You could also have gross negligence exclusions in those policies. Or exclusions for felonious intentional acts by employees.
I am very rusty and it shows. Been forever since I did any practicing and for that I am grateful. Definitely don't put deep stock in what I am saying on this topic. Coffee clutch speculation.
January 29th, 2018 at 4:11 PM ^
Other commenter has it right on subrogation-- you can't subrogate against your own insured. What's far more likely is that the insurers fight tooth and nail not to pay defense costs or settlement costs for the intentional acts of Nassar himself, and then negotiate with MSU on what is covered w/r/t the institution's negligence. The insurers (because this is going to touch on excess and umbrella layers of coverage, not just the primary layer) will also look long and hard at what MSU knew and when, as there are issues of prior knowledge (as in, when MSU knew or should have known that claims were likely to come, and, if they did, what they said on their annual insurance policy applications about same). Also there are probably sublimits within the policies for different types of damages (such as Title IX). All in all, it will be a brawl for many years, and the insurers won't pay a cent more than they feel they must, not only for business reasons but also for reasons of moral hazard and principle. They'll insure negligence, sure. But they don't (and cannot, by law, due to public policy considerations) insure criminal conduct. And, if it's hard to suss out what part of the claims are for criminal conduct and what part are for negligent conduct, the insurers will likely foot the bill for the entire defense, but won't pay indemnity (settlement/judgment) for anything other than the negligence of MSU employees working in the scope of their employment.
These are just my guesses, but I will say that I practice insurance coverage law as my specialty and have for about 10 years, and this is how I see it playing out. If MSU tries to do what PSU did and fight the insurers like crazy, the insurers will go to the mat and fight like heck in court. That's what actually led to a bunch of discovery making its way into the public record in the PSU case-- it was the insurance coverage suits which brought a lot of additional stuff to light, via deposition testimony of those involved.
January 29th, 2018 at 4:12 PM ^
Other commenter has it right on subrogation-- you can't subrogate against your own insured. What's far more likely is that the insurers fight tooth and nail not to pay defense costs or settlement costs for the intentional acts of Nassar himself, and then negotiate with MSU on what is covered w/r/t the institution's negligence. The insurers (plural, because this is going to touch on excess and umbrella layers of coverage, not just the primary layer) will also look long and hard at what MSU knew and when, as there are issues of prior knowledge (as in, when MSU knew or should have known that claims were likely to come, and, if they did, what they said on their annual insurance policy applications about same). Also there are probably sublimits within the policies for different types of damages (such as Title IX). All in all, it will be a brawl for many years, and the insurers won't pay a cent more than they feel they must, not only for business reasons but also for reasons of moral hazard and principle. They'll insure negligence, sure. But they don't (and cannot, by law, due to public policy considerations) insure criminal conduct. And, if it's hard to suss out what part of the claims are for criminal conduct and what part are for negligent conduct, the insurers will likely foot the bill for the entire defense, but won't pay indemnity (settlement/judgment) for anything other than the negligence of MSU employees working in the scope of their employment.
These are just my guesses, but I will say that I practice insurance coverage law as my specialty and have for about 10 years, and this is how I see it playing out. If MSU tries to do what PSU did and fight the insurers like crazy, the insurers will go to the mat and fight like heck in court. That's what actually led to a bunch of discovery making its way into the public record in the PSU case-- it was the insurance coverage suits which brought a lot of additional stuff to light, via deposition testimony of those involved.
January 29th, 2018 at 4:18 PM ^
The liklihood is that MSU will be fighting civil suits on two fronts: the assault victims and the insurers.
January 29th, 2018 at 12:07 PM ^
January 29th, 2018 at 12:15 PM ^
might be a strong word. But any member of that University, student manager to President, that didn't do their job or stayed willfully "ignorant" or attempted to cover-up, intimidate, not fully investigate, etc. Should lose their job, point blank, period.
It is unfortunate that some good people are going to get caught in the crossfire, and for that, I feel empathy for those that did nothing wrong who may lose their jobs. I will say, that I do feel satisfaction in those wrong-doers being punished. So I completely disagree with your "none of this is good", because some of this IS GOOD and well deserved.
January 29th, 2018 at 12:28 PM ^
In this day and age with so much accountability with media, social media and cell phones, a scandal this widespread and suppressed is unfathomable. The fallout is just beginning...
January 29th, 2018 at 1:16 PM ^
"The motion to dismiss could be six months away," Henning said. "The question is now whether MSU waits for the motions to dismiss or starts trying to resolve (through settlements) now. MSU doesn't want to let this get into the discovery phase of a trial."
If MSU's legal counsel is still among the living, I bet they want to avoid ANY discovery on these suits (given that they've tried to avoid allowing access altogether), so it would be interesting to see how long they are willing to wait for decisions on many of these.
January 29th, 2018 at 7:19 PM ^
The problem with settlement is authority.
MSU wants to settle the case, but the insurance companies will never authorize, as they will want to sue to get removed from the case. Therefore, if MSU wants to settle, they will have to pay the full share, up front, on their own, without a president.
Who will authorize that? I suppose the State Treasurer, AG or Governor could do it. But right now, I doubt any officer at the university has the authority to pull a 9 figure deal.
I would be stunned if this settles. Currently MSU will have motions to dismiss civil suits based on government agency (there are limits there too, as individual agents CAN he held accountable - right former president and current bitch without a job Simon?), and as soon as those fail - and they will likely fail - the insurance companies will be suing to be removed as responsible parties.
We are at the beginning of a mutliple year morass. Probably would have been better for everybody if they worked harder to prevent people from going around raping and serial molesting.
January 29th, 2018 at 2:54 PM ^
and assuming that MSU will need to raise funds to meet these obligations, I think it's time to fire the UM Money Cannon at MSU and get some key naming rights...
Spartan Stadium...now known as Little Brother Field
Breslin Student Center...now becomes Moo Stae U Center for Kids That Don't Read So Well
January 29th, 2018 at 4:39 PM ^
Moo Staee U Center for Kids that Dont Read So Good
FTFY
January 29th, 2018 at 3:03 PM ^
Magic Johnson quote...
[anyone who knew] "about sexual assaults happening to women on the MSU campus" and did nothing about it should be fired and he called for policies and procedures to be put in place to make sure it never happens again."
Doesn't this mean he's signed Izzo and Dantoni's pink slips?
January 29th, 2018 at 3:38 PM ^
Mr Integrity himself. I understand what he is saying but he might want to stay in his own lane.