INSURANCE SPECIALTIES EXPERT WITNESS TESTIMONY HELPS END 18 MONTH
SHAREHOLDER DISPUTE INVOLVING CAPTIVE INSURANCE
AUSTIN, TEXAS— December 8, 2015— In a recent case involving a Texas-based company, usage of a captive insurance program led to a lengthy dispute as to the valuation of each partners’ ownership stake in company and the related, but separate captive insurance company. After eighteen months of litigation, the dispute has come to a successful resolution in favor of the client of Austin, TX-based lawyer Paul Browder, a partner with the law firm Blazier, Christensen, Bigelow & Virr.
As companies increasingly turn to captive insurance for an alternative risk management tool, unforeseen issues are coming to the forefront related to ownership structure and proper characterization of the captive assets held in reserve. This leads to a major question, “who is the rightful owner of the money in that insurance company account?”
Since this case involved a captive insurance program, Browder turned to his network of experts for support in clarifying an otherwise complex captive insurance arrangement, leading to an engagement with Timothy Adkins of Austin, TX-based Insurance Specialties, a local leader in alternative risk consulting to closely held businesses.
“Since we did not have the expertise or legal background in captives, it was vital to the case to bring in the right expert witness, someone who had the experience and working knowledge of captive insurance companies. That’s when a prominent Austin accountant recommended Timothy Adkins ofInsurance Specialties. Mr. Adkins provided insight and education, guiding me through discovery with the right questions to ask and specifically what to look for from a legal and operational standpoint. Mr. Adkins equipped us with the proper knowledge so we knew what to uncover, and how to make sense of what was previously a hidden asset to my client. He was an absolute necessity for us to get the outcome we wanted. This case had been pending for over eighteen months, but we were able to settle out of court. Without Mr. Adkins as the expert witness, this case would have been very difficult,” explained Paul Browder, Attorney with Blazier, Christensen, Bigelow & Virr.
“I took on the case as an expert witness because I believed in and agreed with our client’s position in the dispute. Additionally, this case was a fascinating intersection of business, insurance and law that afforded my firm an opportunity to work with a great team of tax, legal and insurance experts to bring clarity to a complex financial structure and insurance program. Our role was to establish and uphold our client’s proper shareholder value, which included valuing the reserves of a captive insurance company. My work in collaboration with Brian Mueller, CPA a tax partner at Five Stone Tax Advisers, led to a successful conclusion for our client. To see it through to a successful outcome for our client was gratifying and I believe demonstrates the high degree of competence Insurance Specialties and our partners bring to every client relationship,” stated Mr. Timothy Adkins of Insurance Specialties.
Mr. Mueller also had a firm belief in the case, and immediately recognized the tax and accounting complexities presented by the fact pattern from the dispute. As a licensed CPA with an extensive domestic and international background in tax compliance and advanced tax planning, his input was vital in obtaining a successful resolution. “My role as an expert witness was to equip legal counsel with clarity and specificity surrounding the complex tax and accounting rules for Captive Insurance arrangements,” Mueller stated. “It was a fascinating, challenging endeavor from day one.”