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Opioid Case May Guide Climate Change Insurance Suits

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Law360 Insurance Authority
May 11, 2022

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The rising tide of climate change lawsuits is sure to bring with it a wave of declaratory judgment actions on the issue of whether liability insurers have an obligation to defend fossil fuel producers and other climate change defendants.

Courts considering declaratory judgment cases are likely to be tasked with deciding, among other things, whether the allegations in the underlying complaint constitute an occurrence within the meaning of a liability insurance policy.

Liability insurers seeking guidance on this issue should consider AIU Insurance Co. v. McKesson, a recent opioid decision from U.S. District Judge Jacqueline Scott Corley of the U.S. District Court for the Northern District of California.[1]
Based on allegations analogous to those in many climate change lawsuits, Judge Corley, applying California law, concluded that the allegations did not establish an “occurrence,” thus eliminating the possibility of coverage under the policy and any obligation on the part of the liability insurer to defend or indemnify the insured. AIU Insurance v. McKesson Corp. McKesson Corporation manufactures and distributes opioids and other pharmaceutical products.In 2017, two counties in Ohio sued McKesson, asserting several claims including a negligence […]

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