London Insurance Case Puts Focus on Industry Poaching, Racism

By Eddie Spence and David Hellier | October 25, 2019

Insurance broker Arthur J. Gallagher Group lost a 10 million-pound ($12.8 million) lawsuit against rival Ardonagh Group Ltd. in a case highlighted by racially charged comments that put a spotlight on the cutthroat world of London insurers.

Judge Clive Freedman in London on Friday largely rejected a lawsuit filed by Gallagher over claims that Ardonagh improperly poached two of its executives. He said that the rivalry between the insurers was comparable to that between soccer teams: “Either you play for the team, or you are part of the enemy.”

Nawaf Hasan and Peter Burton both headed up separate divisions of Alesco, a subsidiary of Gallagher, before resigning within a month of each other to join Ardonagh units in 2018. In the weeks that followed, Hasan received abuse from his former colleagues before both men were ultimately sued by Gallagher.

The judge highlighted the remarks of Simon Matson, then Alesco’s chief executive officer, as “abusive and racist.” In a message to another executive, Gary Lashmar, Matson described Hasan as a “complicated fat Arab,” with Lashmar responding “and a very greedy one.”

“I was shocked and hurt by the racist and Islamophobic language used by former colleagues,” Hasan said in a statement. “The judge was right when he said they were like fanatical football supporters. There should be no place where abusive and racist language is acceptable.”

The case won’t help the scandal-hit London insurance industry fix its image problems. Lloyd’s of London, one of the industry’s most venerable names, has faced accusations of endemic sexism. But this is the first time that Gallagher, a U.S. listed firm with a market capitalization of $16.9 billion, has been dragged into the spotlight.

The judge found in favor of the defendants on all but one claim, noting that the fact Burton and Hasan rarely worked together at Alesco made it unlikely they jumped ship in conspiracy with one another.

A spokesman for Gallagher said that they were disappointed with the result but considered the matter closed. He said Matson and Lashmar declined to comment.

“The language that came to light during the trial is regrettable and not a fair or true reflection of Gallagher’s leadership nor of the firm’s beliefs and culture,” the insurance firm said in a statement.

Ardonagh Chairman John Tiner said he found it “highly regrettable” that Gallagher chose “to pursue their case on the basis of personal attacks which sought to disrupt our business.”

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