United States Life Insurance v. Insurance Commissioner

MEMORANDUM **

United States Life Insurance Company (U.S.Life) entered into a contract with Superior National Insurance Company and other insurers (collectively, Cedents) in May 1998, whereby U.S. Life agreed to reinsure insurance policies worth more than $1 billion issued by Cedents. U.S. Life allegedly discovered evidence of material nondisclosure by Cedents after entering into the reinsurance contract and requested arbitration. In the midst of arbitration, Cedents were judged insolvent *561 and their assets were seized by the California Insurance Commissioner (Commissioner), who now appears as a party in this suit as the statutory liquidator of Ce-dents. The arbitration panel reformed the reinsurance contract, reducing the liabilities ceded to U.S. Life by 10 percent. The district court denied U.S. Life’s petition to vacate the arbitral award. We affirm. Because the parties are familiar with the facts, we do not recite them in detail.

I.

The Commissioner contends that the district court lacked jurisdiction over the petition for review of the arbitral award because (a) U.S. Life had “voluntarily invoked state court jurisdiction” before petitioning the federal district court…