Conour malpractice carrier wins rescission of coverage

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The insurance company that provided malpractice coverage to ex-attorney and convicted fraudster William Conour prevailed in its civil suit against him, but his many victims still may receive a small amount from the case.

District Judge William T. Lawrence of U.S. District Court for the Southern District of Indiana granted summary judgment and default judgment in favor of the company Wednesday in Minnesota Lawyers Mutual Insurance Co. v. William F. Conour, et al., 1:12-CV-1671.

Lawrence wrote that Minnesota Lawyers was entitled to rescission of the policies because Conour had misled the company in applying for annual coverage from 2007 until 2012. He failed to disclose actual or potential complaints against him.

Conour last year pleaded guilty to stealing more than $6 million from client trust funds that held settlements he had negotiated in personal injury cases in a scheme the government alleged dated to 1999. He was sentenced to 10 years in federal prison.

The company previously refunded to the court policy premiums Conour had paid for the years it says it owed no duty to cover because Conour didn’t disclose his theft or the criminal charge after it was filed. The company said it had no knowledge Conour was embezzling, misappropriating or converting clients’ funds until it discovered the criminal complaint independently.

The court has held $16,337 plus interest that the insurer refunded in premiums and ordered the parties and the U.S. attorney in Conour’s criminal case to decide within 30 days of the order how the funds should be disbursed.

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