Lawsuits come with territory for international parent, Marsh and McLennan Cos. [The Roanoke Times, Va.]

Apr. 4--Rutherfoord executives kicked the tires, as did executives from Marsh & McLennan Agency, which ultimately acquired Roanoke-based Rutherfoord on March 16.

It's called "due diligence" -- like a car shopper scrutinizing Carfax reports or a loan officer scouring credit histories.

Marsh & McLennan Agency is a comparatively new subsidiary of Marsh, an international insurance brokerage firm. And Marsh, in turn, is a subsidiary of publicly traded Marsh & McLennan Cos.

MMC, like most businesses its size, faces risks to earnings associated with civil lawsuits. As a publicly traded company, MMC must report such risks.

For example, subsidiary Mercer, a human resources consulting firm, is a defendant in a major suit filed by the Alaska Retirement Management Board.

The retirement board alleges professional negligence, malpractice and other examples of alleged mishandling by Mercer of retirement fund actuarial services. The suit seeks damages of at least $2.8 billion. MMC's 2009 annual report discloses that a negative outcome in the case could affect the company's businesses, results of operations, financial condition or cash flow.

Connecticut has sued MMC subsidiary Guy Carpenter, alleging price-fixing and other improper conduct.

MMC and Marsh once tangled with Eliot Spitzer, then attorney general of New York, who alleged various improper practices. Marsh eventually settled the case and apologized for the actions of "certain Marsh employees" who had "unlawfully deceived their customers." On Feb. 11, MMC, Marsh and the attorney general's office amended a settlement agreement negotiated in 2005.

Both George "Shad" Steadman, vice chairman and chief operating officer of Rutherfoord, and David Eslick, chief executive officer of Marsh & McLennan Agency, said such litigation is not uncommon considering the scope of MMC's businesses and the company's international presence.

"I have no concern relative to the impact of any of that on Marsh & McLennan Agency," Eslick said.

Steadman said MMC has brought in new leadership from outside the company. In January 2008, Brian Duperreault became MMC's director, president and CEO.

"With the old leadership, I don't know if we would have had the confidence we have now," Steadman said.

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