uBiome D&O clash paused by Delaware court
A Delaware court suspended legal proceedings over 9.5 million in directors and officers insurance claims tied to former uBiome executives until California federal judges rule on jurisdiction questions. The litigation trust seeks to have Evanston Insurance Company, Wesco Insurance Company, and Great American Insurance Company cover defense costs for Jessica Richman and Zachary Apte, who face multiple government actions. Starstone Specialty Insurance Company has already paid its $3 million policy limit for the cofounders who established the medical testing firm.
Judge Eric Davis applied the McWane principle, favoring first-filed cases, holding that Evanston’s California proceedings took priority over Delaware trustees’ claims. Insurers denied payment, citing policy terms that require full compliance before lawsuits and pointing to government exclusions. The companies question whether federal courts hold authority over the executives who moved to Germany. Delaware proceedings restart if California magistrates find they lack proper jurisdiction over the defendants.
