Communications infrastructure company Zayo Group Holdings Inc. failed to convince a Delaware state judge that units of American International Group Inc., Chubb Ltd., and Arch Capital Group Ltd. should cover a $27 million settlement paid by the company’s former CEO in shareholder litigation over a take-private transaction.
The settlement was “an effective increase in consideration” barred by “bump-up” exclusions in the insurers’ policies, Judge Paul R. Wallace said in a Wednesday ruling for the Delaware Superior Court. The insurers were also granted summary judgment on Zayo’s bad faith claim because a breach of contract couldn’t be established.
“The …