8-KOther Events

BERKSHIRE HATHAWAY INC 8-K Report, Corporate Update (Oct 17, 2006)

Filed October 17, 2006For Securities:BRK-BBRK-A

Summary

This Form 8-K filing from Berkshire Hathaway Inc. (BRK-B) on October 17, 2006, provides a crucial update regarding an ongoing investigation by the U.S. Attorney for the Eastern District of Virginia (EDVA) concerning Reciprocal of America (ROA). The most significant piece of information for investors is that Berkshire Hathaway's wholly-owned subsidiary, General Reinsurance Corporation (Gen Re), and its current or former employees are no longer viewed as targets or subjects in this investigation. While Gen Re and some of its employees had previously received subpoenas and been interviewed in connection with the ROA investigation, this filing confirms that the EDVA U.S. Attorney has explicitly stated that neither Gen Re nor any of its employees are currently targets. This news significantly reduces a potential legal and financial overhang for Berkshire Hathaway, indicating a positive resolution regarding this specific matter. The company reaffirms its commitment to full cooperation with the authorities.

Key Highlights

  • 1General Reinsurance Corporation (Gen Re), a Berkshire Hathaway subsidiary, is no longer considered a target or subject in the U.S. Attorney's Eastern District of Virginia investigation of Reciprocal of America (ROA).
  • 2This update resolves a previously disclosed area of potential legal scrutiny for Berkshire Hathaway and its subsidiary.
  • 3The company continues to cooperate fully with the EDVA U.S. Attorney's investigation into ROA.
  • 4The filing confirms that specific individuals, including a former president of Gen Re, who were previously targets or subjects, are also no longer considered targets.
  • 5Other previously disclosed governmental investigations remain pending.

Frequently Asked Questions

The primary purpose of this filing was to inform investors that Berkshire Hathaway's subsidiary, General Reinsurance Corporation, and its employees are no longer considered targets or subjects in the U.S. Attorney's investigation into Reciprocal of America (ROA).

This is important because it removes a significant potential legal and financial risk for the company. Previously, the investigation could have led to fines, lawsuits, or reputational damage. This clarification suggests a positive resolution regarding this specific matter.

No, the filing explicitly states that 'Investigations by various governmental authorities of other matters, as previously disclosed, remain pending.' This filing only addresses the specific ROA investigation and Gen Re's involvement in it.

Reciprocal of America (ROA) was a Virginia-based reciprocal insurer that provided professional liability risks for physicians, hospitals, and lawyers. The U.S. Attorney's investigation was related to this entity.