Posted 8/2/2007 09:02 am
Updated 1 year ago
Advanced Environmental Recycling Technologies Inc. of Springdale said Thursday that it has settled with an international insurance firm in litigation related to 2003 fire at one of its plants.
AERT, which makes and sells composite decking materials, said it has agreed to the terms of a settlement with underwriters at Lloyd's of London. Under the settlement, Lloyd's agreed to pay AERT $700,000 and the parties provided mutual releases to one another.
Lloyd's of London underwriters sued AERT in 2005 over a pending final settlement of AERT's 2003 Junction, Texas, fire claim.
Lloyd's filed suit in the Washington County Circuit Court seeking a declaratory judgment that it was not liable to reimburse AERT for certain costs of rebuilding the AERT plant.
Lloyd's alleged that AERT did not rebuild the plant exactly as it had existed before the fire and that AERT committed fraud in seeking reimbursement for alleged improvements made to the facility. Lloyd's also sought to retroactively cancel its portion of the insurance policy.
AERT said the filing was unexpected because it had "cooperated fully with the claims underwriting process and negotiations toward a final settlement of the claim were progressing."
AERT said it believes the Lloyd's lawsuit is without merit, and it filed a counterclaim Monday denying all of Lloyd's allegations and seeking immediate and full reimbursement for rebuilding the plant. AERT is seeking actual damages of about $1.8 million, plus attorney and court fees and punitive damages.