Reinsurer, Cedent Battle Over Application of Law in $1.8 Million Case

NEW YORK - A reinsurer is urging a federal magistrate judge to apply New York law to a dispute involving a $1.8 million settlement of a construction defects action, arguing that New York has the greatest connection to the lawsuit. Tonicstar Ltd. v. National Union Fire Insurance Company of Pittsburgh, No. 07-02371 (S.D. N.Y.).

But the cedent, National Union Fire Insurance Company of Pittsburgh, has asked Magistrate Judge Gabriel W. Gorenstein of the U.S. District Court for the Southern District of New York to apply California law.

In March 2007, Tonicstar Ltd., as capital provider for Lloyd's Syndicate 1861, filed …