Unavailability Exception in Asbestos Coverage Dispute Affirmed by New Jersey Supreme Court New Jersey Supreme Court, June 27, 2018

NEW JERSEY — The decision involved questions about the insurance coverage available to defendant Honeywell International, Inc. (Honeywell), a New Jersey based corporation, for thousands of bodily-injury claims premised on exposure to brake and clutch pads (friction products) containing asbestos.  The court first considered whether the law of New Jersey or Michigan (the headquarters location of Honeywell’s predecessor when the disputed excess insurance policies were issued) should control in the allocation of insurance liability among insurers for nationwide products-liability claims. Second, the court addressed whether…
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Asbestos Claims Related to Operations Ceasing Prior to Coverage Dates of Insurance Policy Deplete Aggregate Limits U.S. Court of Appeals for the Fourth Circuit, March 26, 2018

The Walter E. Campbell Company (WECCO) was a company that handled, sold, installed, and removed insulation materials containing asbestos. Since the mid-80s, WECCO was subjected to numerous lawsuits from individuals alleging damages due to asbestos exposure. WECCO is now defunct. Although many claims against WECCO remained pending, its insurers contended that they were no longer contractually obligated to defend or indemnify WECCO because their aggregate limits had been exhausted. WECCO responded by arguing that the insurers improperly allocated operations claims as completed operations claims. Unlike…
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Asbestos Cleanup Costs Covered Under Premise Pollution Liability Policy U.S. District Court for the Western District of Missouri, March 16, 2018

MISSOURI — A federal district court in Missouri held that Illinois Union Insurance Company was obligated to defend and indemnify its insured, Sunflower Redevelopment, LLC, with regard to requests from a state environmental agency to investigate the possibility of contamination by asbestos and other pollutants at a site that Sunflower was remediating. Sunflower and the U.S. Army were subject to a consent order from the Kansas Department of Health and Environment (KDHE) requiring them to remediate contamination at a former army ammunition plant. In compliance…
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All-Sums Allocation Applied to Additional Insured Coverage for Wrongful-Death Claim Based on Asbestos Exposure U.S. District Court for the Northern District of California, March 15, 2018

CALIFORNIA — Plaintiff Polar-Mohr Maschinenvertriebsgesellschaft (Polar-Mohr) was sued by claimants seeking damages for the alleged wrongful death of their father, a former service technician for Polar-Mohr machines who died from mesothelioma due to exposure to asbestos and/or asbestos-containing products.  Polar-Mohr sought coverage from Zurich American Insurance Company as an additional insured on a policy issued by Zurich to Heidelberg Eastern, which was Polar-Mohr’s only customer during the policy period.  The issues before the court were whether Zurich’s liability to Polar-Mohr would be based on pro-rata…
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Wisconsin Federal Court Denies Insurers’ Attempt to Consolidate Coverage Actions U.S. District Court for the Eastern District of Wisconsin, Oct. 27, 2017

WISCONSIN — A federal judge in Wisconsin denied several insurers’ request that it abstain from hearing claims against them for coverage in asbestos-related related suits against Eaton Corporation. Some of the underlying claims brought against Eaton were based on personal injuries from using products produced by a company Eaton acquired by merger, Cutler-Hammer, Inc. Each of the defendant insurers had, at some time, issued an excess liability insurance policy to Cutler-Hammer. Eaton has coverage actions pending against insurers in both Ohio and Wisconsin. The Ohio…
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California Bankruptcy Court Holds Coverage Action is Core Bankruptcy Proceeding U.S. Bankruptcy Court, Northern District of California, August 25, 2017

CFB Liquidating Corporation emerged from the Chapter 11 bankruptcy of Chicago Fire Brick Co. (CFB), a company that manufactured products containing asbestos. Asbestos-related claims overwhelmed the company, and the Plan of Reorganization that was confirmed in the bankruptcy proceedings essentially directs the Trustee to administer the company’s remaining assets to pay asbestos-related claims. CFB’s remaining assets included several insurance policies. While most of CFB’s insurers settled with the bankruptcy estate and made payments, Continental Casualty Company elected to file a proof of claim and negotiate…
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New York Appellate Court Won’t Take Insured’s Word in Asbestos Coverage Case New York Supreme Court, Appellate Division, Second Department, August 23, 2017

Duro Dyne National Corporation, Duro Dyne Corporation, and Duro Dyne Machine Corporation have been named as defendants in hundreds of lawsuits throughout the country in which the plaintiffs seek to recover damages for injuries allegedly sustained as result of exposure to asbestos contained in products manufactured and/or distributed by Duro Dyne. One of Duro Dyne’s insurers, North River, filed a lawsuit seeking a declaration that it had no duty to defend or indemnify Duro Dyne in the underlying lawsuits. Duro Dyne moved for summary judgment,…
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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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