California Bankruptcy Court Holds Coverage Action is Core Bankruptcy Proceeding

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

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

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

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

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

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

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

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

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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