Margaret (Peg) Anderson is a partner in Lord, Bissell & Brook’s Bankruptcy & Restructuring Group and concentrates in creditors’ rights matters. She represents secured and unsecured creditors in bankruptcy cases and out-of-court restructurings throughout the country. Her clients include numerous lending institutions, including several large domestic and foreign banks. Peg has experience advising buyers and sellers of assets of troubled companies. Peg is co-chair of the firm’s Diversity Committee and has served on the firm’s Compensation Committee.

Bankruptcy Services for Insurance Companies

Peg has extensive experience advising insurance companies in bankruptcy cases. She frequently represents insurance companies in the collection of premium, deductibles, and other amounts owed to them by insolvent companies, especially with respect to amounts due on loss-sensitive policies. She has enforced insurers’ rights to collect amounts due from their bankrupt insureds, often involving claims by the insurers in the tens of million of dollars, in venues throughout the country, including in the ASARCO, Pacific Lumber, Delta, U.S. Airways, WorldCom, National Steel, The Fleming Companies, Piccadilly Cafeterias, Bethlehem Steel, Owens Corning, and Payless Cashways cases.

Peg achieved an important victory for her client, and for all insurers, when the Fourth Circuit Court of Appeals held in In re Howard Delivery that amounts due with respect to workers’ compensation insurance were entitled to priority under the Bankruptcy Code, in the face of three other Circuit Court decisions to the contrary. The Supreme Court of the United States granted the debtor’s petition for writ of certioriari in Howard Delivery. Although the firm was not counsel of record in the case before the Supreme Court, our attorneys were actively involved in drafting the brief and preparing for oral argument before the Supreme Court. On June 15, 2006, the Supreme Court, calling the issue a close call, overruled the Fourth Circuit and held insurance companies were not entitled to priority in bankruptcy cases for amounts due for workers’ compensation insurance. Dicta in the Supreme Court decision, however, supports insurers’ claims for priority for amounts due on other types of insurance that benefits employees, such as life, health and disability insurance.

Peg also counsels insurers with respect to the handling of covered claims when their insureds are in bankruptcy. She has represented major insurers in coverage disputes in several prominent chapter 11 cases involving mass tort litigation, where the claims against the insurers were in the millions (and sometimes billions) of dollars, including in the Celotex, Dow Corning, Kaiser, Flintkote and Archdiocese of Portland cases.

In addition, Peg counsels insurers and reinsurers in connection with commutation agreements with troubled insurance companies. She has assisted purchasers of books of business from troubled insurance companies in minimizing their operational and financial risks in any subsequent insolvency proceeding involving the seller.

Peg is Chair of the Claims and Priorities Subcommittee of the Business Bankruptcy Committee of the Business Law Section of the American Bar Association.