The Board of Commissioners of the Port of New Orleans today approved the settlement of its lawsuit with property insurer FM Global for an undisclosed amount. This amicable resolution follows almost two years of intense negotiations and legal skirmishes. Both sides are pleased with the settlement and believe it is a reasonable conclusion to the dispute. It will permit each party to return to its core business without the distraction of major litigation.
“We are satisfied that this is a fair offer for the damages sustained during Hurricane Katrina that were covered by FM Global,” said Gary P. LaGrange, President and CEO. “Settling this lawsuit allows us to close the chapter on our Katrina insurance claim, continue making repairs and avoid a costly and protracted battle of lawsuits and appeals.” LaGrange went on to credit the personal involvement of former Chairman Danny Hughes in helping to focus the issues and push the process along.
The Port of New Orleans had two property insurance policies when Katrina hit -- one with Lexington Insurance Company with a policy limit of $20 million, one with FM Global with a policy limit of $145 million for hurricane damage. Before the settlement, Lexington paid the Port the policy limit for Katrina damages and FM Global advanced the Port funds to begin some repair projects.
“Although most of our pre-Katrina cargo facilities are operational today, there are still many signs of Katrina’s wrath at Port properties,” said LaGrange. “The timing of this settlement will allow us to continue with our aggressive repair schedule, and the money will go a long way towards restoring our facilities to the high quality standards that our customers and tenants expect.”