Staff of Bermuda's newest reinsurance venture - Quanta Reinsurance Ltd. - are being sued by their former employer, CNA Financial Corp., for the alleged use of company secrets to help in the set-up of the company they now work for.

The four - John Van Decker, John Lopes, Anthony Codding and Cathy Cossu - were formerly mid-level executives with Chicago-based CNA but reportedly jumped ship last month to work for start-up Quanta. The suit, filed by CNA in Illinois, alleges that the former staff members used CNA secrets to help establish the rival firm.

Quanta - the only class four reinsurer, or multi-million dollar company, to open its doors in Bermuda this year - was set up in August and last month completed a private placement deal securing $500 million in capital.

The group's legal counsel, John Siegal, a senior litigator with law firm Proskaurer Rose, yesterday told The Royal Gazette: "We believe the lawsuit filed by CNA on September 30 is without merit. It is our intention to fight this complaint vigorously and we expect to prevail."

The suit from CNA - which is against Quanta employees and not the company itself - follows on the heels of an earlier suit filed on September 11 against another former employee.

The first action was launched against former CNA executive Thomas Taylor, who had been hired by Quanta to lead its US operations. That suit alleged that Mr. Taylor had broken a non-compete agreement when he recruited CNA staff to Quanta.

Court papers revealed that CNA's action against Mr. Taylor alleged that he and Quanta recruited CNA executives who "possessed the special technical expertise and product knowledge necessary to bring Quanta's plans to fruition".

Although Mr. Taylor has now resigned from Quanta, following a court order barring him from working for the company through 2004, a source close to the matter said that the non-compete agreement with CNA had expired and that Mr. Taylor was never involved in the recruitment of any CNA people.

Mr. Taylor's case is now in arbitration, and the suit launched yesterday against the four former CNA employees was cited by one close to the matter as "mere tactics".