Luzerne County Judges

September 30, 2009

Mericle sues his insurance carrier

Not defending him in juvenile cases irks developer. Firm: No coverage for allegations.

By Terrie Morgan-Besecker tmorgan@timesleader.com
Law & Order Reporter
Terrie Morgan-Besecker on Facebook   |   @TLTerrieMorgan on Twitter

SCRANTON – Real estate developer Robert K. Mericle has filed a federal lawsuit against an insurance company, alleging the firm has improperly declined to defend him against lawsuits filed by hundreds of juveniles who allege they were wrongly incarcerated.

The suit, filed by attorney Kim Borland, claims that “bodily and personal injury” provisions within several policies written by Travelers Property and Casualty Co. of America provide Mericle and his construction firm coverage against claims contained in the lawsuits.

Travelers maintains it is not required to defend Mericle or pay any monetary award that might result from the lawsuits because the allegations against him do not fall within the definition of bodily or personal injury, according to a separate complaint it filed earlier this month.

Travelers also contends Mericle has no coverage because his alleged actions fall within several exclusions within the policy that state coverage will not be provided for “willful violations” of criminal statutes or for the “knowing violation of rights of another.”

Mericle is among the defendants named in a class-action lawsuit and master individual complaint filed on behalf of juveniles who appeared before former Luzerne County judge Mark Ciavarella.

The suits allege Mericle conspired with Ciavarella and his co-defendant, former judge Michael Conahan, to improperly detain juveniles to ensure the PA and Western PA Child Care centers built by Mericle and co-owned by attorney Robert Powell maintained a high occupancy rate. Powell paid kickbacks to Ciavarella and Conahan in return.

Mericle pleaded guilty on Sept. 2 to failing to report a felony in connection with his role in the juvenile scandal. Travelers notified him the next day that it would not provide coverage for the civil suits.

Travelers will have a chance to respond to Mericle’s suit before a federal judge hears the case and determines if the policy language provides coverage.

Terrie Morgan-Besecker, a Times Leader staff writer, may be reached at 570-829-7179.

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