Pharmaceutical companies at risk of opioid-related litigation should consider whether they are covered by their insurance policy.
Liability insurance coverage may be available for defense costs under Comprehensive General Liability Insurance (“CGL”) policies. Whether coverage is available turns on the specific policy language, the relevant state law rules of construction and interpretation, and the particular allegations in a given lawsuit.
The Case Law is LimitedCurrently, there are relatively few decisions addressing coverage specifically tied to opioid cases. All such decisions, however, follow a standard analysis.
In Cincinnati Insurance Co. v. H.D. Smith, LLC, 829 F.3d 771 (7th Cir. 2016) (applying Illinois law); Cincinnati Insurance Company v. Richie Enterprises LLC, C.A. No. 1:12-CV-00186-JHM-HBB (W.D. Ky 2014) (applying Kentucky law); and Liberty Mutual Fire Insurance Co. v. J.M. Smith Corp., 602 Fed. Appx. 115 (4th Cir. 2015) (applying West Virginia law) (together “the West Virginia Cases”) each of the courts held insurers were responsible for paying defense costs in cases brought by West Virginia against distributors of opioids.
By contrast, in The Traveler’s Property Casualty Company of America v. Actavis, Inc., Super. Ct. No. 30-2014-00746842 , slip. Op. (Cal. Ct. App. 2014), the California Court of Appeals affirmed the judgment of the California Superior Court that the CGL policies in question did not require Travelers to defend or indemnify pharmaceutical company Watson for...
