New Court Ruling May Have Insurer on the Hook for Nearly 100 Asbestos Lawsuits:
Lawsuits related to asbestos exposure have been common since the 1960's. We’ve long known that asbestos exposure can cause cancer, including a deadly cancer known as mesothelioma. Asbestos lawsuits typically happen as personal injury lawsuits against the party responsible for the patient’s exposure. Often, when many people face exposure, the courts handle asbestos cases as class action lawsuits. When the party responsible for exposure was insured, the insurance company often must defend the lawsuits.However, asbestos-related cancers can take decades to appear. In some cases, patients don’t have a diagnosis for 30 to 40 years, and the original, responsible party may have merged with another company or faced acquisition. In other words, asbestos lawsuits can be complicated, as CNA’s Continental Insurance Company recently discovered.Under a recent court of appeals ruling, Continental may be on the hook to defend nearly 100 asbestos lawsuits brought against Daikan Industries, a multinational air conditioning manufacturing company. Continental argued in court that it had no duty to defend the lawsuits even though Continental had once insured a predecessor company of Daikan because the lawsuits didn’t specifically allege the liability of the predecessor company, McQuay-Perfex.According to the original complaint, Continental issued a Comprehensive General Liability policy to McQuay-Perfex, also known as McQuay, Inc., from 1967 to 1982. In 1984, Synder General Corp. purchased McQuay. Then in 1994, a Malaysian company acquired Snyder. Finally, Daikan’s parent company purchased the Malaysian company in 2006. In 2013, Daikan notified Continental of a mass tort action involving nearly 100 asbestos claims and asked for Continental to defend it under the McQuay-Perfex policies from 1967 to 1982.
Declaratory Judgment Action in Federal Court
Continental brought a declaratory judgment action in federal court to determine the scope of its responsibilities. A district court judge agreed with Continental that it had no duty to defend the suits because none of the suits expressly mentioned the liability of the companies preceding McQuay-Perfex.On appeal, the 8th Circuit disagreed with Continental and the district court. The appeals court held that “an underlying complaint need not ‘specifically allege’ facts that make the duty to defend obvious; it is enough if the allegations make it ‘arguable’ that an insured liability is at issue.” The court remanded the case to the district court to review each of the cases at issue to determine whether the complaints make it “arguable” that Continental’s liability is at issue. The appeals court also ordered the district court to read the allegations “liberally.” So, Continental may still have an obligation to defend Daikan against the asbestos claims.
Contact the Madeksho Law Firm
If you or someone you love faces asbestos-related cancer, you may be entitled to compensation. Call the Madeksho Law Firm at 1-888-910-MESO (6376) or contact us online to set up a consultation. Your first consultation is complimentary, and you never pay a fee unless we recover compensation on your behalf.
