No Coverage for Defense Costs Incurred in Response to CERCLA Demand

more+
less-

U.S. Court of Appeals for the Fourth Circuit

In Industrial Enterprises, Inc. v. Penn America Ins. Co., ___ F.3d ___, 2011 WL 925451 (4th Cir. (Md.) March 18, 2011), the U.S. Court of Appeals for the Fourth Circuit ruled that a commercial general liability (CGL) policy providing coverage for “sums which the insured shall become legally obligated to pay as damages because of "property damage” did not cover an insured’s defense costs incurred in response to the Environmental Protection Agency’s (EPA) demand under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) to remediate the presence of hazardous substances on the insured’s land. The court ruled that the insured’s defense costs did not constitute “property damage” under the CGL policy because the insured’s potential liability under CERCLA arose from the EPA’s regulatory authority rather than the federal government’s rights as a property owner.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

Published In: General Business Updates, Environmental Updates, Insurance Updates, Commercial Real Estate Updates, Toxic Torts Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Sedgwick LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »