AIG Unit Sued by Boy Scouts Over 1970s Sex Abuse Settlements

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A unit of American International Group Inc. was sued by the Boy Scouts of America over claims it refused to provide insurance coverage for settlements of child sex-abuse cases from 1975 to 1980.

The scouting organization alleges that National Union Fire Insurance Co. of Pittsburgh PA refused to participate in the defense or settlement of claims brought by “individuals alleging bodily injury from sexual abuse,” according to a complaint filed Tuesday in Dallas federal court.

National Union provided the scouts umbrella or excess liability policies in the late 1970s, according to the complaint, which describes “by way of example” a claim brought by a person identified only as “A.J.” who sought $10 million in compensatory damages and $50 million in punitive damages. National Union declined to take part in a mediation of that claim, which ended in a “reasonable settlement,” according to the complaint.

Matt Gallagher, a spokesman for New York-based AIG, declined to comment on the complaint.

The lawsuit doesn’t specify the number of sexual-abuse claims made or pending against the Dallas-based Boy Scouts of America.

The organization, which said it may incur more costs from future lawsuits, alleged breach of contract and seeks a court order directing National Union to provide coverage for the sex-abuse litigation.

A Boy Scouts of America representative didn’t immediately respond after regular business hours to an e-mail seeking comment on the lawsuit.

The case is Boy Scouts of America v. National Union Fire Insurance Company of Pittsburgh PA, 3:15-cv-02420, U.S. District Court, Northern District of Texas (Dallas).

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