7th Circuit: Stop using specialist jargon

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The 7th Circuit Court of Appeals affirmed a District Court ruling in a complex reinsurance case and asked attorneys to be mindful of the language they use in these types of cases.

In Indiana Lumbermens Mutual Insurance Company v. Reinsurance Results, Inc., No. 07-1823, the federal appellate court dealt with the task of determining whether the District Court was correct in granting summary judgment in favor of Indiana Lumbermens. Reinsurance Results, Inc. - which reviews an insurance company's claims against its reinsurers to ensure the insurance company receives the benefits to which its reinsurance contracts entitle it - sought a third of $2.2 million dollars it claimed it obtained for Lumbermens as a result of a review.

Judge Richard Posner broke down the opinion into simpler terms compared to complicated industry terms the attorneys had used in their briefs. Lumbermens had changed the way it paid for its reinsurance premiums to increase the amount of surplus shown on its books. An increased surplus means Lumbermens would not have to pay its reinsurers a premium on certain policies. The accounting change affected the amount of money Lumbermens could bill its reinsurers for losses covered by policies. Lumbermens entered into a contract in 2004 with Reinsurance Results, which alerted Lumbermens that its accounting policy might be improper. Lumbermens' accounting firm advised the company to revert back to its pre-2000 ways of paying premiums.

As a result of the switch back, Reinsurance Results found Lumbermens was entitled to more than $2 million from its reinsurers. Reinsurance Results claimed according to its contract with Lumbermens, it was entitled to a third of that money.

The 7th Circuit agreed with the District Court that Reinsurance Results was not entitled to a portion of the $2.2 million because the benefit Lumbermens received as a result of Reinsurance Results discovering the accounting issue was not one that Lumbermens was contractually obligated to pay Reinsurance Results for discovering. Reinsurance Results could have tried to negotiate the contract to be broader, but under its current contract, it was seeking money in which it was not entitled.

Judge Posner also dedicated a portion of the opinion to reminding attorneys that most judges are not specialists but generalists and therefore will not understand complex jargon relating to a specific industry.

"Lawyers should understand the judges' limited knowledge of specialized fields and choose their vocabulary accordingly. Every esoteric term used by the reinsurance industry has a counterpart in ordinary English, as we hope this opinion has demonstrated," he wrote.


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  1. Joe, you might want to do some reading on the fate of Hoosier whistleblowers before you get your expectations raised up.

  2. I had a hospital and dcs caseworker falsify reports that my child was born with drugs in her system. I filed a complaint with the Indiana department of health....and they found that the hospital falsified drug screens in their investigation. Then I filed a complaint with human health services in Washington DC...dcs drug Testing is unregulated and is indicating false positives...they are currently being investigated by human health services. Then I located an attorney and signed contracts one month ago to sue dcs and Anderson community hospital. Once the suit is filed I am taking out a loan against the suit and paying a law firm to file a writ of mandamus challenging the courts jurisdiction to invoke chins case against me. I also forwarded evidence to a u.s. senator who contacted hhs to push an investigation faster. Once the lawsuit is filed local news stations will be running coverage on the situation. Easy day....people will be losing their jobs soon...and judge pancol...who has attempted to cover up what has happened will also be in trouble. The drug testing is a kids for cash and federal funding situation.

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