Delaware Supreme Court Rules that $239 Million in Claims Constitute One Occurrence

Stonewall Ins. Co. v. E.I. du Pont de Nemours & Co.

(Del. June 3, 2010)


DuPont manufactured Delrin, which was used in polybutylene plumbing systems in residences across the United States and Canada until 1989.  The pipe fittings were susceptible to damage because they could not withstand chlorine, soluble metals, mechanical stresses and certain pHs.  Homeowners sued DuPont for property damages they sustained, claiming that the material was defective.  Between 1989 and November 2007, DuPont paid over $239 million for liabilities

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Breaking News on Deepwater Horizon Coverage Issues: Excess Insurers Sue Over Oil Spill Liabilities

On May 21, 2010, several insurers
that issued excess liability insurance policies to Transocean Ltd. filed a
declaratory judgment action in the United States District Court for the
Southern District of Texas against BP PLC and its subsidiaries seeking a
judgment that they have no obligation to cover pollution claims arising out of
the Gulf of Mexico oil spill. 

On April 20, 2010, the Deepwater
Horizon rig owned by Transocean Ltd. and under contract to BP PLC exploded,
causing a massive oil leak that

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Court Denied Policyholder Claims For Additional Insurance Coverage For Debris Removal and Pollution Clean-up

Whitt Machine, Inc.
v. Essex Ins. Co.

(United States Court
of Appeals, Sixth Circuit, May 13, 2010)

This environmental coverage dispute
resulted from a fire loss at a building owned by the policyholder.  The insurer paid the policy proceeds for the
direct loss of the building, however, policyholder refused insurer’s offer to
pay an addition coverage amount under the debris removal coverage provision of
the policy as the actual costs exceeded the offered amount.  The policyholder also claimed that the policy
provided additional

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Georgia Court Finds That Natural Gas Not a “Pollutant”

Barrett v. National
Union Insurance Company
(Ga.App. May 11, 2010)

A Georgia
Court of Appeals has ruled that natural gas is not a pollutant within the
meaning of a CGL policy.  An employee of a gas-line installation
contractor suffered brain damage while working with natural gas lines. 
According to the decision, the employee suffered injury because he was wearing
a plastic rain poncho and natural gas accumulated over 2+ hours he was working
with the gas line. As a result of exposure to the accumulated …

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Court Decides Multiple Coverage Issues In Complex Refinery Oil Spill Case

Coffeyville Resources Refining & Marketing, LLC.
v. Liberty
Surplus Ins. Corp. et. al.
(United States
District Court, District of Kansas, May 3, 2010)

This complex environmental
coverage matter arose out of a flood of the Verdigris River
on June 30, 2007. During the flood, a large amount of crude oil from policyholder’s
oil refinery was released into flood waters and was carried into Coffeyville, Kansas,
resulting in widespread environmental damage to downstream homes and
businesses. The policyholder alleged that as a result of this oil

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Chartis Sued Over Coverage for Sulfuric Acid Leak

Blackwater New Orleans v. American International Specialty Lines (E.D.Louisiana, May 7, 2010) 

In February 2009, Blackwater New
Orleans LLC, a chemical storage company, discovered a sulfuric acid leak in an
above-ground storage tank at its Westwego,
Louisiana facility.  The company transferred the remaining
contents of the tank to a second tank, which also began to leak.  The company then moved the acid to barges
owned by a third party.   

Westwego’s city attorney sent the
company a letter demanding cleanup pursuant to city and state

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Court Holds That Injuries To Two Children Constituted One Occurrence In Lead Poisoning Case, Thus Limiting Recovery To Single Occurrence Coverage Amount

Allstate Ins Co.
v. Bonn et. al.

(United States
District Court, District of Rhode Island, May 3, 2010)


This environmental coverage
matter arose from a complaint against landlords of a residence alleging that
the tenant’s two daughters were exposed to lead paint and suffered lead poisoning
during their tenancy at property owned by the policyholder landlords.  The insurer sought a declaration that its
liability for claims asserted by the tenants in the underlying complaint is
limited to the total amount of $100,000. 

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Cases for Environmental Coverage Quarterly – May Edition

Here are the cases cited in this month's edition of the Environmental Coverage Quarterly.  If you would to receive this publication directly to your email account, please contact Toni Frain at [email protected].  Cases provided courtesy of Lexis.

Aggio v. Estate of Aggio

Aspen v. Dune Energy

Bernstein v. Bankert

Boston Gas v Century Indemnity

Chubb Custom Ins v Space Systems

Douglas Ridge Rifle Club v. St Paul Fire & Marine Ins. Co.

Dutton-Lainson v The Continental Ins

Griffith Oil v National Union

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Application of Boston Gas Damages Apportionment Method Leads To 80% Jury Verdict Ruling for Plaintiff Insured In Environmental Coverage Dispute

Brothers, Inc. v. American Employers’ Ins. Co. et. al. (Massachusetts Superior Court, Essex District,
April 9, 2010)

This environmental coverage
matter arises from a dispute over the division of damages for long-term
environmental claims stemming from pollution clean-up costs at an EPA Superfund
site.  The jury returned a verdict in
favor of the plaintiff in the amount of $120,000 finding that the insurer breached
both its duty to defend and its duty to indemnify.  However, the damages returned related only to
the issue of

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Court Holds Insurer Obligated To Continue Reimbursement Of Defense And Investigation Costs Despite Policy Limits On Indemnity For Oil Spill Claims

Commercial Lines LLC v. Water Quality Ins. Syndicate
(United States
District Court, Southern District of New York, March 29, 2010)

This coverage action addressed
the extent to which the insurer’s policy covers the insured’s investigation and
defense costs involving a maritime accident and oil spill on the Mississippi River in July 2008.  Specifically, the
accident occurred when an unmanned barge sank and released approximately
300,000 gallons of fuel oil into the river. 

As a result of the accident
the insured, as owner of the

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