New York Court of Appeals Opts for “All Sums” Allocation in Asbestos Coverage Case Supreme Court of New York, New York County, April 18, 2016

In a landmark ruling, the New York Court of Appeals held that “all sums” allocation and vertical exhaustion applied in a case involving coverage for injuries related to asbestos exposure. The court based its holding on the language of the insurance policies, which included non-cumulation clauses or non-cumulation and prior insurance provisions. The plaintiffs, Viking Pumps, Inc. and Warren Pumps, LLC acquired pump manufacturing businesses from Houdaille Industries in the 1980s. These acquisitions later subjected Viking and Warren to significant potential liability in connection with…
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Court Sides with Insurers; Rules Pro Rate Approach Applies on Liability Costs U.S. District Court for the Southern District of New York, March 21, 2016

The case involves two consolidated lawsuits — one from the federal district court for the Southern District of New York, and another from Georgia state court. The Georgia state court action was removed to federal court and then transferred to the Southern District of New York. This lawsuits concern insurance coverage for The Fairbanks Company for liability arising from asbestos-related personal injury actions. Prior to 1984, Fairbanks manufactured packings and gaskets that contained asbestos. Fairbanks entered into insurance policies with several insurers, including Liberty, between…
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Court Rules Insurer Has Duty to Pay Defense and Indemnification Costs of Asbestos Claims U.S. District Court for the Middle District of Pennsylvania, February 29, 2016

Liberty Mutual had a duty to pay defense and indemnity costs for a variety of asbestos-related cases filed nationwide against its insured, York International Corporation, and York Corporation, the insured’s predecessor. Liberty Mutual had elected not to defend the underlying lawsuits or file a declaratory judgment action regarding coverage, and the underlying suits were settled by the insured. The insured then submitted the complaints in the underlying cases and invoices for defense and indemnity costs to Liberty Mutual. In this case, the court ruled on…
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Massachusetts Court Grants Defendants’ Motion to Dismiss in Case Where Plaintiff Sought Reimbursement for Litigation Expenses in Asbestos-Related Cases U.S. District Court for the District of Massachusetts, February 5, 2016

The U.S. District Court for the District of Massachusetts ruled that the Massachusetts Insurers Insolvency Fund could not pierce the corporate veil or impose successor liability on a corporation that purchased the assets of another corporation, which was the subject of workplace injury claims based on exposure to asbestos and whose liability insurers had become insolvent. Beacon Sales Company, Inc. (BSC) sold nearly all of its assets to the defendant Beacon Sales Acquisition, Inc., (BSAI) a subsidiary of defendant Beacon Roofing Supply, Inc. (BRS), in…
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Fifth Circuit Rules Insurance Company Has No Duty to Defend After Primary Insurer Declared Insolvent U.S. Court of Appeals for the Tenth Circuit

Canal Insurance Company was the excess and umbrella insurer of Montello, Inc., a manufacturer of oilfield drilling equipment that contained asbestos.  Montello had been sued by individuals claiming injuries as a result of exposure to asbestos in connection with its equipment. In 2003, Montello’s primary insurer, The Home Insurance Company, was declared insolvent by a New Hampshire court without having paid out any claims for bodily injury on Montello’s behalf. Thereafter, Canal filed suit for declaratory judgment that it had no duty to defend Montello…
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Texas Federal Court Ruled Primary Carrier Was Entitled to Reimbursement for Settlement Payments But Not Defense Costs in Connection with Underlying Asbestos Cases U.S. Disctrict Court, Eastern District of Texas, October 12, 2015

LGS Technologies, LP v. U.S. Fire Ins. Co., No. 2:07-CV-399, 2015 U.S. Dist. LEXIS 139085 (E.D. Tex. Aug 14, 2015) On October 12, 2015, the district court from the Eastern District of Texas filed an order, accepting the report and recommendation of the Special Master in connection with an asbestos insurance coverage dispute between a variety of primary and excess carriers.   LGS Technologies, LP (LGS), a gasket company, had both primary policies from 1980-83 with ACE, primary policies from 1983-1993 and excess policies from 1986-1993…
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Court Applied Pennsylvania Law in Asbestos Coverage Case Based on Insured’s Residence U.S. District Court for the Middle District of Pennsylvania, October 13, 2015

York Int’l Corp. v. Liberty Mut. Ins. Co., No. 1:10-CV-0692 (M.D. Pa. Oct. 13, 2015) This decision involves a dispute over whether Pennsylvania or New York law would apply to an insurer’s duty to defend and indemnify an insured for asbestos-related claims. Due to the passage of more than 50 years between the period covered by the relevant policies and the initiation of the lawsuit, no party with firsthand knowledge of the negotiation and consummation of the policies could be identified, and complete copies of…
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Pre-Judgment Interest Above Policy Limits Recoverable Under Pennsylvania Law

General Refractories Company (GRC) has been named as a defendant in over 30,000 asbestos lawsuits since 1978. In 2002, GRC tendered to it excess carriers, including Travelers Casualty (Travelers) and Surety Company (formerly The Aetna Casualty and Surety Company) under a 1985-86 policy. Travelers denied coverage under an asbestos exclusion.  GRC proceeded to settle many of the underlying claims and pursued coverage from Travelers.  In March 2015, the United States District Court ruled that the asbestos exclusion was unenforceable, leaving only a calculation of damages…
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