Wiseman Oil Company Inc. was awarded partial summary judgment in the U.S. District Court, Western District of Pennsylvania on Tuesday in its action seeking defense costs and damages from TIG Insurance Company related to the $26 million cleanup of the Breslube Penn Superfund Site located in Coraopolis, Pennsylvania. Both parties had filed for summary judgment to resolve whether TIG had a duty to defend Joseph and Ruth Wiseman, the owners of Wiseman Oil, in the CERCLA action brought by the United States Environmental Protection Agency.
United States District Judge Joy Flowers Conti adopted the report and recommendation authored by Chief Magistrate Judge Lisa Pupo Lenihan as the opinion of the court. The opinion held that TIG’s standard form Comprehensive General Liability policies from the 1960s and 1970s required TIG to defend the Wisemans and noted that “the Duty to defend arises whenever a fair reading of the underlying Complaint, with its assertions of relevant general or specific factual and statutory bases of liability, does not expressly rule out the possibility of insurance coverage under the applicable policy terms.” The decision also held that the general allegations of environmental contamination contained in the EPA’s complaint were not excluded by a policy exclusion typically found in CGL policies during the 1960s and 1970s that precludes coverage unless pollution is “sudden and accidental.”
The court stated that while TIG “would prefer the court to apply a standard by which it is excused from its duty to defend unless coverage is definitively or expressly within the language of the underlying complaint. . . . Defendant’s preference is, however, not in accord with governing law.”
The decision also recognized that representations made by the insurance industry to regulators are relevant and admissible in determining the meaning and applicability of the “sudden and accidental” pollution exclusion. Michael Goodstein, Shareholder at Hunsucker Goodstein, and counsel on the coverage case and in the underlying CERCLA action for Wiseman Oil, stated that, “we are pleased that the Wisemans are a step closer to receiving the policy benefits they paid for and deserve.”
Hunsucker Goodstein represents clients in environmental and insurance coverage matters nationwide. The firm has offices in Washington, DC, California, Colorado, and Indiana.
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