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Insurance companies hoping to recoup billions of dollars they’ve already paid in claims to Maui fire victims are asking a federal judge to get in the middle of a legal squabble that has been playing out in state court.

So far, Maui Circuit Court Judge Peter Cahill has been blocking more than 140 insurance companies from going after Hawaiian Electric Co., Kamehameha Schools and others to recover some of the $2.3 billion they’ve already paid out.

The Hawaii Supreme Court has agreed to step in to resolve the question of whether insurance companies can also sue HECO and others who may be responsible for the fires, even though they’ve already been sued by thousands of wildfire victims.

Now, the insurers are asking U.S. District Court Judge Jill Otake to get involved as well.

At stake is a proposed $4 billion settlement between individual victims and the defendants. If the insurance companies are allowed to seek damages separately from Hawaiian Electric Co. and the others, it could de-rail the settlement.

The insurers say they are being blocked from pursuing their lawsuits, known as subrogation claims.

“We are only intervening to ensure that we get our day in court,” Adam Romney, a lawyer for the insurers, said in a text message.

In a motion filed last week in federal court, Romney and the insurance lawyers accuse attorneys for the victims and the defendants of trying to shut out the insurance industry.

“Those ‘global resolution settlement proceedings’ are a mere euphemism for a process that seeks to destroy the Subrogation Plaintiffs’ legal rights,” the brief says.

Jesse Creed, who helped negotiate the settlement as a liaison counsel for individual fire victims, dismissed the insurers’ argument. He said the insurance companies are simply looking for another venue after failing to make headway before Cahill and Oahu Circuit Court Judge Dean Ochiai. 

“It’s blatant forum shopping,” Creed said.

“They didn’t like what Cahill said, or Ochiai, or that the Hawaii Supreme Court is getting involved,” added Creed, who noted that the insurers only recently sought to intervene in federal court. “Their decision happened after all that.” 

It’s routine for insurers to file subrogation lawsuits against alleged wrongdoers. And the allegations by insurers that HECO and Kamehameha Schools were to blame for the fires gained more credence on Wednesday, when a report by Maui County and the federal Bureau of Alcohol, Tobacco, Firearms and Explosives reached the same conclusion.

The issue is whether the insurers’ right to subrogation is affected by the proposed settlement. The Hawaii Supreme Court could rule on the question by the end of the year. In the meantime, the insurers are seeking a friendlier and perhaps less politicized ear in the federal court, specifically from Otake. 

The insurers include international firms like Lloyds of London, Mitsui Sumimoto and Swiss Re International; large U.S. firms like State Farm and Allstate, and local companies including ,  and . 

The defendants, which also include the State of Hawaii, Maui County, Spectrum and Hawaiian Telcom, have agreed to pay $4.04 billion collectively to settle the litigation. 

According to the document laying out terms of the final settlement, the agreement must include “a framework to ensure it resolves and releases all Maui Fires Claims of any kind, including claims for damages, equitable relief, subrogation, lien payments, attorneys’ fees, expert fees, costs and all remedies and amounts of any kind.”

The insurers have made clear they have no intention of releasing their claims.

In their legal filing, the insurers present a narrative showing details of mediation and court processes in which the insurers say they couldn’t get questions answered.

They also say Cahill called a status conference that the insurers’ brief describes as “a highly irregular proceeding.”

“At 9:05 a.m. Judge Cahill recessed the hearing and held a private in-chambers meeting with certain attorneys for the Individual Plaintiffs and the Defendants in this action,” the document says. “That in-chambers meeting was not open to the public and was not livestreamed on the �Ჹ�ɲ���ʻ�� State Judiciary’s YouTube channel. At 9:57 a.m. Judge Cahill reconvened the public hearing and discussed a ‘plan’ or an ‘idea’ developed during the meeting.”

Eventually during the hearing, Cahill issued an order saying he had authority to address and resolve issues related to subrogation.

Later, the parties announced a settlement — widely described as a “global settlement” — that cut out the insurers altogether.

Civil Beat’s coverage of Maui County is supported in part by a grant from the Nuestro Futuro Foundation.