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Note: As part of a reinsurance agreement, Assurecare Corporation (Re-Insurer/Applicant) provided Arrowood Indemnity Company (Insurer/ Beneficiary) with a standby letter of credit issued by U.S. Bank (Issuer). When Re-Insurer/Applicant refused to reimburse Insurer/Beneficiary for US$ 580,484.65 in losses associated with litigation arising out of a death at a nursing home insured by Insurer/ Beneficiary, Insurer/Beneficiary drew US$ 361,518 under the standby and sued Re-Insurer/Applicant to recover the balance of the losses. Re-Insurer/ Applicant counterclaimed for breach of contract, conversion, fraud, unjust enrichment, and negligence based on the alleged wrongful drawing of the standby. Insurer/Beneficiary moved to dismiss the fraud and unjust enrichment counterclaims, whereupon Re- Insurer/Applicant abandoned its fraud claim and alleged a new claim that Insurer/Beneficiary had tortiously interfered with Applicant's business relationship with Issuer. The United States District Court for the Northern District of Illinois, Hibbler, J., granted Insurer/Beneficiary's motion to dismiss both the tortious interference and unjust enrichment claims.

The Judge ruled, that the facts pled did not state a cause of action for tortious interference or unjust enrichment. The Judge stated that the pleadings did not indicate that Insurer/Beneficiary intended to interfere with Re-Insurer/Applicant's relationship with Issuer or that Insurer/Beneficiary's conduct actually did interfere with that relationship. Further, because Re-Insurer did not dispute the validity of the underlying contract that governed Insurer/ Beneficiary's drawing of the standby, the Judge rejected Re-Issuer's unjust enrichment claim because under Georgia law such a remedy is not available where there is an enforceable contract.

[JEB/tg]

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