Stout Risius Must Repay Insurer $60,000 for Stock Plan Defense

Great American Fidelity Insurance Co. can recoup about $60,000 it spent defending professional valuation firm Stout Risius Ross Inc. from litigation over its handling of a paper company’s employee stock ownership plan, a Michigan federal court ruled.

Michigan state courts haven’t definitively said whether insurers are entitled to reimbursement of defense costs following a ruling that they have no duty to defend, but the US Court of Appeals for the Sixth Circuit has allowed reimbursement in these circumstances, Judge Laurie J. Michelson of the US District Court for the Eastern District of Michigan said Tuesday.

Michelson emphasized that Great American ...