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Updated February 12, 2024, at 12:00 p.m.
Insurance broker Marsh USA asked the U.S. District Court of Massachusetts to dismiss its liability for up to $15 million in legal fees from Harvard’s nine-year-long court battle with Students For Fair Admissions over its affirmative action admissions policies, according to filings made last month.
Harvard’s suit came on the heels of an earlier legal defeat. In 2021, Harvard went to court against Zurich American Insurance Company, alleging “breach of contract” and seeking damages after the insurer denied the University coverage of its legal fees from the trial against SFFA “with late notice cited as the sole reason.” Harvard lost its suit against Zurich.
After Harvard’s loss against Zurich in district court, the First Circuit Court of Appeals ruled against the University in August 2023. Less than three months later, Harvard sued Marsh.
Harvard’s case, originally filed in state court, was moved to federal jurisdiction following a request by Marsh in early January.
Marsh requested dismissal almost a month after the case was removed. In its request, Marsh argued that Harvard’s claims were “time-barred” and should be dismissed.
Under New York state law – which governed the broker agreement signed by both Marsh and Harvard – there is a six-year statute of limitations on complaints of breach of contract. After an extension through the pandemic, Marsh contends that the statute of limitations lasted through Sep. 15, 2022 – over a year before Harvard sued the insurance broker.
Harvard, in Feb. 9 filings, disagreed. According to the University, while Marsh’s “basic math” is correct, the company incorrectly determined the statute of limitations on its agreement with Harvard. Harvard alleged that the statute of limitations under Massachusetts state law expired on Feb. 11, 2024.
“By incorrectly applying the statute-of-limitations rules of New York rather than Massachusetts, Marsh both (i) miscalculated the date when Harvard’s claims accrued and (ii) accounted for the wrong number of days of tolling,” Harvard’s legal team wrote in its Feb. 9 court filings.
In its brief, Harvard claims that federal precedent requires the court to use Massachusetts state law to decide which state’s jurisdiction — New York or Massachusetts — governs the case. Even though Marsh and Harvard agreed for their contract to be governed by New York law, Harvard wrote, Massachusetts “considers such a provision as just one factor” when deciding which state’s law to apply in the case of a potential contract breach.
Massachusetts has a “substantial interest” in the University’s claims against Marsh, lawyers for Harvard added.
A spokesperson for Marsh USA declined to comment Tuesday morning. Harvard spokesperson Jason A. Newton also declined to comment on the legal proceedings.
Both parties currently await a decision by the District Court on Marsh’s motion to dismiss. If the motion is denied, the case will continue and potentially enter litigation.
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