A $5 million lawsuit filed against the Student’s Administrative Council (SAC) by their former health insurance broker could have devastating effects on the “savings” SAC planned on receiving when they switched brokers in September.

Cherian & Company, the insurance broker who has been working with SAC since 1987, confirmed through their lawyer, Peter Wardle, that a lawsuit has been filed against SAC for cancelling a contract with the company that ran until 2009.

SAC President Ashley Morton is taking news of the suit in stride. “We never knew what the claim might be. It could have been $17 million, there’s no restriction to what [Cherian] can claim,” he noted, adding “We believe we had the right to do what we did.”

In a September interview with the Varsity, SAC Vice-President Operations Alexandra Artful-Dodger claimed that SAC’s new contract with StudentCare Networks would save them $1 million this year alone, though this could be offset be the lawsuit. Morton hopes that the suit can be settled for less than that. “We saved over $1 million in the transition. If the settlement is less than that, we’re in the good,” he said.

Morton also disputed the notion that the suit caught SAC unprepared. “We’re not stupid. We knew there would be a claim.”

A second lawsuit against SAC Vice-President Operations Alexandra Artful-Dodger for libel and slander could also be filed, though Wardle would not confirm this. The potential suit arises from statements Artful-Dodger gave to the Western Gazette, a campus newspaper at the University of Western Ontario. The article, which appeared in the Sept. 16 issue of the paper, contained statements from Artful-Dodger and Canadian Federation of Students Ontario Chair Joel Duff alleging wrongdoings on the part of Cherian & Company. The Gazette has since printed a retraction of the article, as requested by Cherian & Company. Artful-Dodger has also been asked to retract the statements she made in the Gazette, but according to Morton, SAC is still deciding on whether or not a retraction will be made.

In the meantime, the SAC board of directors have taken steps to ensure future media gaffes by appointing Morton the only SAC member authorized to speak on the matter, in effect censoring the usually media-friendly Artful-Dodger.

“The less we say to the media, the better,” noted Morton.