MATTER OF SCOTTISH RE (U.S.), INC.

C.A. No. 2019-0175-JTL.

274 A.3d 1019 (2022)

In the MATTER OF the Rehabilitation of SCOTTISH RE (U.S.), INC.

Court of Chancery of Delaware.

Date Decided: April 18, 2022.


Attorney(s) appearing for the Case

Peter B. Ladig , GianClaudio Finizio , BAYARD, P.A., Wilmington, Delaware; Diane J. Bartels , Wilmington, Delaware; James J. Black, III , Jeffrey B. Miceli , Mark W. Drasnin , BLACK & GERNGROSS, P.C., Philadelphia, Pennsylvania, Counsel for The Honorable Trinidad Navarro, Receiver for Scottish RE (U.S.), Inc.

Michael Busenkell , GELLERT SCALI BUSENKELL & BROWN, LLC, Wilmington, Delaware, Counsel for Scottish RE (U.S.), Inc.

Marisa R. DeFeo , Randall S. MacTough , SAUL EWING ARNSTEIN & LEHR LLP, Wilmington, Delaware, Counsel for Lincoln National Life Insurance Company, Lincoln Life and Annuity Company of New York and First Penn Pacific Life Insurance Company.

Christopher Viceconte , GIBBONS P.C., Wilmington, Delaware, Counsel for AXA Equitable Life Insurance Company, MONY Life Insurance Company of America, MONY Life Insurance Company of the Americas, LTD., and U.S. Financial Life Insurance Company, Manhattan Life Insurance Company, Manhattan Life Assurance Company of America.

Daniel Hargraves , FREEBORN & PETERS LLP, New York, New York, Counsel for AXA Equitable Life Insurance Company.

Randall S. MacTough , ZARWIN BAUM DEVITO KAPLAN SCHAER TODDY, PC, Wilmington, Delaware, Counsel for First Penn Pacific Life Insurance Company.

Joseph B. Cicero , Gregory Stuhlman , CHIPMAN BROWN CICERO & COLE, LLP, Wilmington, Delaware, Counsel for Berkshire Hathaway Life Insurance Company of Nebraska, Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance Company, Allianz Life Insurance Company of North America, Ameritas Life Insurance Corp., Ameritas Life Insurance Corp. of New York, The Ohio National Life Insurance Company, Ohio National Life Assurance Corporation, Pacific Life Insurance Company, Pacific Life and Annuity Company, Columbus Life Insurance Company and Security Benefit Life Insurance Company.

R. Stephen McNeill , D. Ryan Slaugh , POTTER ANDERSON & CORROON LLP, Wilmington, Delaware, Counsel for Americo Financial Life and Annuity Insurance Company, Great Southern Life Insurance Company, National Farmers Union Life Insurance Company, and United Fidelity Life Insurance Company.

William P. Bowden , Catherine A. Gaul , Ricardo Palacio , ASHBY & GEDDES, Wilmington, Delaware, Counsel for PHL Variable Insurance Company, Nassau Life Insurance Company f/k/a Phoenix Life Insurance Company and Nassau Life and Annuity Company f/k/a Phoenix Life and Annuity Company, Protective Life Insurance Company, The U.S. Branch of Sun Life Assurance Company of Canada, Fidelity & Guaranty Life Insurance Company, Fidelity & Guaranty Life Insurance of New York.

John C. Phillips, Jr. , Paul S. Seward , PHILLIPS, GOLDMAN, MCLAUGHLIN & HALL, P.A., Wilmington, Delaware, Counsel for Hannover Life Reassurance Company of America and Security Life of Denver Insurance Company.

Joseph C. Schoell , FAEGRE DRINKER BIDDLE & REATH LLP, Wilmington, Delaware, Counsel for The Canada Life Assurance Company; Homesteaders Life Company; Police and Firemen's Insurance Association.

Kathleen M. Miller , SMITH, KATZENSTEIN & JENKINS, LLP, Wilmington, Delaware, Counsel for The Prudential Insurance Company of America, Metropolitan Life Insurance Company, Employers Reassurance Corporation and Jackson National Life Insurance Company.

David A. Felice , BAILEY & GLASSER, LLP, Wilmington, Delaware, Counsel for Great American Life Insurance Company.

John G. Harris , Peter C. McGivney , BERGER HARRIS LLP, Wilmington, Delaware, Counsel for the Reinsurance Association of America.

Garrett B. Moritz , Elizabeth M. Taylor , ROSS ARONSTAM & MORITZ LLP, Wilmington, Delaware; Matthew A. Clemente , R. Bradley Drake , John Grothaus , SIDLEY AUSTIN LLP, Chicago, Illinois, Counsel for Merced Private Claims, LLC.

Joelle E. Polesky , STRADLEY RONON STEVENS & YOUNG, Wilmington, Delaware, Counsel for American Council of Life Insurers.

Travis S. Hunter , Renee M. Mosley , RICHARDS, LAYTON & FINGER, P.A., Wilmington, Delaware, Counsel for Transamerica Life Insurance Company, Allstate Life Insurance Company, State Mutual Insurance Company, American Home Life Insurance Company.

Jarret P. Hitchings , DUANE MORRIS LLP, Wilmington, Delaware, Counsel for NW Hall Building LP.

Joseph Larkin , SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, Wilmington, Delaware, Counsel for John Hancock Life Insurance Company (U.S.A.).

Barry M. Klayman , Simon Fraser , COZEN O'CONNOR, Wilmington, Delaware, Counsel for Scottish Re (Dublin) dac.

Kevin J. Mangan , Nicholas T. Verna , WOMBLE BOND DICKERSON (US) LLP, Wilmington, Delaware, Counsel for Brighthouse Life Insurance Company and NonParty Brighthouse Life Insurance Company of NY, New York Life Insurance Company, New Your Life and Annuity Insurance Company, United Heritage Life Insurance Company, Shenandoah Life Insurance Company, USAA Life Insurance Company, United of Omaha Life Insurance Company, Companion Life Insurance Company, SBLI USA Life Insurance Company, Inc., S. USA Life Insurance Company, Inc., Genworth Life Insurance Company, Genworth Life and Annuity Insurance Company, Genworth Life Insurance Company of New York, USAA Life Insurance Company of New York, The Guardian Life Insurance Company of America.

Jody Barillare , MORGAN LEWIS & BOCKIUS LLP, Wilmington, Delaware, Counsel for Assured Guaranty (Europe) plc.

Peter H. Kyle , John L. Reed , DLA PIPER LLP (US), Wilmington, Delaware, Counsel for Non-Party SCOR Global Life Americas Reinsurance Company, SCOR Reinsurance Germany, Branch of SCOR SE, TOA Reinsurance Company, Limited of Tokyo, Japan, SCOR SE, SCOR Global Life Reinsurance Company of Delaware, SCOR Global Life USA Reinsurance Company, Columbian Life Insurance Company, Columbian Mutual Life Insurance Company.


OPINION REGARDING THE LIQUIDATION STANDARD

Scottish Re (U.S.), Inc. ("SRUS" or the "Company") is a delinquent insurer. The Insurance Commissioner of the State of Delaware (the "Commissioner") successfully petitioned the court for an order placing the Company in receivership and appointing the Commissioner as receiver...

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