HomeBusiness InsuranceArt Van heirs to pay nothing out of pocket in $8M settlement

Art Van heirs to pay nothing out of pocket in $8M settlement

Heirs of the late Art Van Elslander would tap business insurance policy proceeds and pay nothing out of pocket as part of a proposed $8 million settlement agreement with the trustee for the Art Van Furniture bankruptcy case.

The tentative settlement, laid out last week by the trustee in federal bankruptcy court in Delaware, would end the trustee’s lawsuit against the Art Van heirs and release them from future claims — if the judge approves the agreement.

Gary and David Van Elslander wave to the crowd during the 91st America's Thanksgiving Parade, presented by Art Van, on Woodward Avenue in Detroit on Nov. 23, 2017.

The settlement would also cover former Art Van CEO Kim Yost and the Boston-based private-equity firm Thomas H. Lee Partners. The Art Van family in March 2017 sold their furniture retailer to the private-equity firm in a complex $621 million deal.

Nearly all of the settlement money is to come from the National Union Fire Insurance Company of Pittsburgh. National Union provided insurance coverage, including for breach of fiduciary duty claims, to former Art Van President Gary Van Elslander, Yost and various Thomas H. Lee Partners officials who sat on Art Van’s board of directors, according to settlement documents.

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