April 2014: Insurance Litigation Update

by Quinn Emanuel Urquhart & Sullivan, LLP

New York Court of Appeals Answers Important Questions About Whether an Increased Risk of Harm Constitutes a Physical Injury. Over the past fifteen years, the question of whether tort claims for medical monitoring fall within the scope of commercial general liability (“CGL”) policies when the claims are based solely on an allegedly increased risk of disease has been one of the most evolving, and frequently litigated, questions in insurance law. The standard CGL policy provides coverage for “sums which the insured shall become legally obligated to pay as damages because of bodily injury.” (See 1973 Standard ISO CGL Agreement.) In a typical medical monitoring case, however, the members of the plaintiff class have not been diagnosed with any disease, do not exhibit any symptoms, and do not claim to have suffered any traditionally defined injury. Rather, the class of plaintiffs alleges that they are at an “increased risk” of disease due to exposure to some toxic substance and seek recovery of the costs of monitoring for any future medical problems. Insurance companies are frequently forced to wrestle with the question of whether tort claims that are based on an “increased risk of disease” constitute “bodily injury” under the standard CGL policy.

The stakes are high. The damages sought in such cases frequently run into the several millions of dollars and medical monitoring class actions have been growing in frequency. The putative class actions often involve tens of thousands (or in some cases hundreds of thousands) of proposed claimants in cases as diverse as tobacco use, pharmaceuticals, medical implants, lead paint-coated toys, and even oil spills. Moreover, given the increasingly heightened public concern over alleged toxicity in numerous products, the likelihood that medical monitoring cases will result in more proposed multi-million dollar class actions—and more coverage litigations—seems not just significant, but inevitable.

On December 17, 2013, the New York Court of Appeals issued a products liability decision in an action captioned Caronia v. Philip Morris. Caronia, a case in which Quinn Emanuel submitted an amicus brief, was a huge victory for products manufacturers. It is, however, also likely to impact the way courts, policy holders, and insurance companies define injury in future medical monitoring cases. In Caronia, the Court of Appeals was asked to determine whether current or former smokers who had not “been diagnosed with a smoking-related disease” and were not then “under investigation by a physician for such a suspected disease” could “pursue an independent equitable cause of action for medical monitoring for such a disease.” The Court of Appeals determined that no such independent cause of action existed under New York law. That decision has important implications for insurance carriers concerning the duty to defend such cases in New York and will likely have a broader impact in other jurisdictions that may follow the reasoning of the Court of Appeals, which held that “[a] threat of future harm is insufficient to impose liability against a defendant in a tort context.” (Slip Op. at 4.)

The Caronia decision is important because in those jurisdictions that allow medical monitoring claims based on allegations of increased risk of disease, the Court of Appeals’ ruling will likely impact how courts will view the obligations of insurance companies to provide indemnification under their CGL policies. In other contexts, the vast majority of courts to interpret the meaning of the phrase “bodily injury” in CGL policies have recognized that “bodily injury” results from “physical injuries to the body and consequences thereof.” See Keri Farrell-Kolb, General Liability Coverage for Claims of Emotional Distress—An Insurance Nightmare, 45 Drake L.R. 981, 985 (1997) (collecting case). The important open question for insurance companies and policy holders is whether courts in the jurisdictions that allow such claims will view claims based on allegations of an “increased risk” of disease as a claim for physical injury. If courts in those jurisdictions follow the reasoning of the New York Court of Appeals and hold that an “increased risk” of developing a disease does not rise to the level of “physical harm,” then Caronia will be one of the most important insurance cases of 2013.

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.

© Quinn Emanuel Urquhart & Sullivan, LLP | Attorney Advertising

Written by:

Quinn Emanuel Urquhart & Sullivan, LLP

Quinn Emanuel Urquhart & Sullivan, LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.