East Lansing files suit against insurance companies to recover payments to Country Mill Farms
GRAND RAPIDS — The City of East Lansing has gone to court in an effort to recoup the $825,000 it paid out in a long-running federal religious freedom lawsuit that ended last year.
In December, the city lost a years-long lawsuit with Country Mill Farms and its owner, Stephen Tennes, over the city banning the farm from its farmers market. The ban was issued after Tennes publicly announced he would not host same-sex weddings at his farm and orchard near Charlotte because of his religious beliefs.
In May 2017, shortly after being banned, Tennes sued the city in federal court. Months later, U.S. District Court Judge Paul Maloney issued a preliminary injunction that allowed him to return to the market while the lawsuit was ongoing. In his order, Maloney signaled that Tennes was likely to win the case should East Lansing press on in its attempts to uphold the ban.
The city, which accumulated more than $292,000 in legal defense costs, according to documents obtained under a public records request, paid Tennes $42,000 in damages and another $783,800 to cover his legal costs, but the city's insurer denied the city's claim for reimbursement of the settlement.
More: Judge rules in favor of Charlotte farmer in long-running case against East Lansing
On Thursday, the city filed a lawsuit in federal court in Grand Rapids, after initially filing suit in Ingham County, against Davies Claims Solutions and the domestic arm of the Lloyd's of London insurance company in an attempt to obtain reimbursement.
Lloyd's was the city's insurance provider and Davies Claims Solutions was the third-party administrator, according to the lawsuit.
Messages were left seeking comment from East Lansing, Lloyd's of London and an attorney for Davies Claims Solutions.
The city claims Lloyd's denied coverage of the $825,000 settlement because it didn't receive notice of the claim and it was settled without Lloyd's consent. East Lansing contends in the lawsuit that its payment wasn't a "settlement" as the term used its policy, but a judgment entered by the court against the city.
More: East Lansing to pay 6-figure settlement in Country Mill farmers market lawsuit
Through its contract with Lloyd's, the city was required to use a third-party administrator to obtain coverage for the County Mill lawsuit, according to the lawsuit. The city contracted Davies Claims Solutions, but alleges in the lawsuit that the company failed to ensure coverage through Lloyd's and failed to notify the insurance company of the judgment.
The city is seeking the $825,000 paid to Tennes, plus costs and legal fees.
Contact reporter Matt Mencarini at 517-377-1026 or mjmencarini@lsj.com.
This article originally appeared on Lansing State Journal: East Lansing sues insurer over Country Mill Farms settlement money
