Ticor Caught in Another Legal Battle : Norlin Industries Sues Over Purchase of Unit

Financially beleaguered Ticor is smack dab in yet another legal fray.

Norlin Industries of New York has filed a $1.4-million lawsuit accusing the Los Angeles-based mortgage and title insurer of misrepresenting the value of Ticor Print Network, a subsidiary that Norlin bought from Ticor in 1983 for $82 million.

Norlin claims such misrepresentation violates the Securities and Exchange Act.

Norlin so far has paid Ticor $81.3 million for the printing unit. But, in a suit filed Friday in federal court in New York, Norlin says it has no intention of paying the balance of $700,000. Instead, it seeks to recover $1.4 million in tax payments that it alleges were incurred by the printing company before it was sold.

Norlin, which is restructuring to stave off bankruptcy proceedings, says in the suit that Ticor knew but failed to disclose that the unit owed the taxes.

Ticor says that any dispute Norlin may have is with Southern Pacific, which owned Ticor until early 1984, when the the insurance company went private in a leveraged buy-out. Southern Pacific officials could not be reached Friday.

While Ticor officials are quick to disavow blame in the Norlin case, they are just as quick to lay claim to the $800,000 still owed for the printing company and to say that they “will pursue every available means to collect the Norlin debt.”

“The (printing) company is just not doing well, and they (Norlin) just don’t want to make payments,” a Ticor spokesman said.

The suit is the latest in a series of financial blows that have beset Ticor in recent months. Most of the problems stem from Ticor’s mortgage insurance subsidiary, which faces a loss of as much as $166 million--and possible insolvency--in connection with soured home loans made by a Virginia real estate syndicate.

Ticor’s title insurance unit remains healthy. State and insurance industry officials warn, however, that only the courts can decide whether the unit will be shielded from the financial obligations facing the troubled home loan insurance unit.