September 12, 2013 10:04:58 AM
PASCAGOULA -- Huntington Ingalls Industries and its insurer have reached cash settlement for $180 million for the shipbuilder's losses from Hurricane Katrina in 2005 at facilities in Pascagoula and Avondale, La.
The Mississippi Press reports that the information was contained in a filing this week with the Securities and Exchange Commission.
On Sept. 6, the company reached a settlement with FM Global, agreeing to release its claims in exchange for a cash payment of $180 million, according to the filing.
According to a quarterly report filed with the SEC on Aug. 7, the trial against FM Global was due to start in October in U.S. District Court for the Central District of California.
"The terms of the settlement agreement are confidential and the company does not anticipated making further public comments regarding the settlement agreement," the filing stated.
The filing noted that Ingalls filed a lawsuit against Aon, the company's broker in connection to the policy with FM Global, seeking damages for breach of contract, professional negligence and negligent misrepresentation, as well as declaratory relief.
The company "waived no rights against Aon in the settlement with FM Global and intends to continue pursuing its claims against Aon," the filing stated.
That quarterly report also outlined the company's damages from the Aug. 29, 2005, storm.
"The company's Ingalls operations were significantly impacted by Hurricane Katrina, and the company's shipyards in Louisiana and Mississippi sustained significant windstorm damage from the hurricane," the filling stated. "As a result of the storm, the company incurred costs to replace or repair destroyed or damaged assets, suffered losses under its contracts, and incurred substantial costs to clean up and recover its operations.
"At the time of the storm, the company had a comprehensive insurance program that provided coverage for, among other things, property damage, business interruption impact on net profitability, and costs associated with clean-up and recovery."
The filing noted the company has recovered a portion of its Hurricane Katrina claim, including $62 million in recovery of lost profits in 2007.
In November 2011, the company recovered an additional $18.8 million from Munich-American Risk Partners, one of its two remaining insurers with which a resolution had not been reached, in connection with settlement of an arbitration proceeding, the filling said.
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