Category Archives: Insurance Coverage

Asbestos Plaintiffs Too Late to Take Advantage of Expansive Maryland Coverage Ruling Court of Special Appeals of Maryland, June 1, 2017

A large group of asbestos plaintiffs failed to file claims seeking more expansive coverage within the applicable statute of limitations.  MCIC Inc. (formerly McCormick Asbestos Company, “MCIC”) sold and installed asbestos insulation products. By the early 1970s, it was clear that asbestos was hazardous, and MCIC ceased selling and installing asbestos-containing products in approximately 1973.  In the late 1980s, several law firms collectively filed several thousand lawsuits against MCIC asserting personal injury claims resulting from exposure to asbestos-containing products. The cases of 8,555 plaintiffs were…

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Is an Argument Challenging Precedent Bad Faith? Pennsylvania Bad Faith Ruling in Asbestos Coverage Case Raises Important Question

Since 1993, the Pennsylvania Supreme Court’s decision in the J.H. France case has dictated that the continuous trigger rule be applied to determine what insurance policies are triggered for asbestos injury claims. Under J.H. France, coverage is provided by policies in effect from the time the claimant was first exposed to asbestos until injury manifests as mesothelioma. The J.H. France court’s decision was expressly based on the science behind mesothelioma, which indicates that mesothelioma is a continuous, progressive injury that begins at the time the…

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Connecticut Appeals Court Adopts Continuous Trigger and Unavailability Rule of Insurance Allocation Appellate Court of Connecticut, March 2017

R.T. Vanderbilt Company, Inc., which formerly manufactured and sold industrial talc that purportedly contained asbestos, brought this action seeking, inter alia, a declaratory judgment to determine its rights and obligations, and those of approximately thirty defendant insurance companies, as to the costs of defending and indemnifying the plaintiff in thousands of underlying lawsuits brought against it in the past several decades that alleged personal injuries resulting from exposure to asbestos. In this 147-page decision, the court determined a multitude of issues related to allocation of…

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Reinsurer Not Automatically Bound to Follow Asbestos Settlement That May Have Been Targeted at Access to Reinsurance U.S. District Court for the Northern District of New York, February 24, 2017

Utica Mutual Insurance Company had issued multiple policies of insurance to Goulds Pumps. Goulds became the subject of thousands of asbestos bodily injury claims. Eventually, Utica reached a $325 million settlement with Goulds for payment under the various insurance policies on the asbestos claims. Utica then sought indemnity for portions of the settlement from its reinsurers, including a $35 million claim against Fireman’s Fund Insurance Company (FFIC). The court here ruled on several motions to eliminate various claims and defenses. Most notably, both parties had…

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Four Corners Rule Determines Employment Status in Coverage Case U.S. District Court for the Eastern District of Pennsylvania, January 26, 2017

Burns & Scalo Roofing Co. was the defendant in an underlying state court action brought by a former employee who had developed mesothelioma due to exposure to asbestos while employed by Burns & Scalo. Burns & Scalo sought defense and indemnity from National Union, which had issued occurrence-based policies to Burns & Scalo for a four-year period after the underlying plaintiff’s employment had ended. After initially denying coverage, National Union agreed to defend Burns & Scalo under a reservation of rights. National Union then filed…

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New York Federal Court Refuses to Apply Viking Pump Without First Receiving Briefs From Parties U.S. District Court for the Southern District of New York, December 21, 2016

Columbus McKinnon Corporation (CMCO) sued Travelers Indemnity Company and Liberty Mutual Insurance Company alleging that insurance policies issued to CMCO obligate them to defend and indemnify CMCO with respect to thousands of lawsuits filed against CMCO for personal injury allegedly caused by exposure to asbestos-containing products manufactured and sold by CMCO and its predecessors. CMCO sought leave to file an expedited motion seeking to compel Liberty Mutual to pay 100 percent of CMCO’s defense costs in the underlying lawsuits based on the New York Court…

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Sixth Circuit Applies Pro-Rata Allocation for Michigan, Allows Reimbursement U.S. Court of Appeals for the Sixth Circuit, December 16, 2016

Indian Head acquired a gasket manufacturing company that had for some time produced gaskets containing asbestos and continued to manufacture and sell such gaskets for five years after the acquisition. Shortly after acquiring the manufacturing company, Indian Head purchased three consecutive liability insurance policies from Continental Casualty Company. Later, Indian Head was sued in thousands of lawsuits for asbestos-related injuries. The Continental policies had an exclusion precluding coverage for any liability assumed “under any contract or agreement” except for an “incidental contract,” defined as a…

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Ohio Appellate Court Applies Triggering-Event Theory of Occurrence, Annualization of Policy Limits in Asbestos Coverage Matter Court of Appeals of Ohio, First Appellate District, Hamilton County, December 14, 2016

The William Powell Company makes industrial valves. Some valves manufactured before 1987 contained asbestos. In 2001, Powell began receiving personal-injury claims emanating from asbestos exposures involving its products. Faced with potentially thousands of claims, Powell sought defense and indemnification under various insurance policies. At issue here were occurrence-based policies that were written by a predecessor to OneBeacon Insurance Company between 1955 and 1977. OneBeacon asked the court to define “occurrence” as used in the policies as Powell’s decision to manufacture valves containing asbestos without providing…

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Bankruptcy Injunction Extends to Debtor’s Insurers U.S. Bankruptcy Court for the District of Delaware, October 17, 2016

W.R. Grace & Co. (Grace), a Chapter 11 bankruptcy debtor, at one time operated a vermiculite mine, and related mining activities released asbestos-containing dust into the atmosphere. It began facing asbestos-related lawsuits in the 1970s. Grace filed a voluntary Chapter 11 bankruptcy in 2001, and a plan of reorganization was confirmed in 2014. The plan created a trust for the payment of asbestos personal injury claims. As part of a settlement agreement, one of Grace’s liability, excess, and workers’ compensation insurers, Continental Casualty Company and…

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Pro Rata Allocation and Exposure Trigger Confirmed in New York Federal Court Decision for Insurers U.S. District Court for the Northern District of New York, September 29, 2016

Troy Belting & Supply Co. was named as a defendant in lawsuits alleging bodily injury caused by exposure to asbestos from products it manufactured. It became involved in a dispute with its insurers over coverage for the costs of settling such lawsuits. Pacific Employers provided coverage for Troy Belting from 1974 to 1984, and various Hartford Insurance Company entities provided coverage from 1984 to 1992. Pacific Employers and Hartford sought reimbursement from Troy Belting for cases where they paid 100 percent of the settlement costs…

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