Flintkote Sues Insurers to Recoup Asbestos Lawsuit Costs

Posted on AsbestosHUB

The U.S. District Court, N.D. California, issued a temporary memorandum and order in an asbestos-related insurance lawsuit filed by The Flintkote Company against various insurers.

The case is styled The Flintkote Company, a Delaware Corporation, Plaintiff, v. General Accident Assurance Company of Canada, a Canada insurance company; General Accident Fire and Life Assurance Corporation Limited of Perth, Scotland, a Scotland insurance company; and Does 1 through 10, Defendants.

District Judge Marilyn Hall Patel entered judgment of Case No. C 04-01827 MHP on June 18, 2008.

Blah blah blah, what does this mean?

It means company and insurers are fighting amongst themselves about who is going to pay asbestos claims.

Flintkote is a company that mined and sold asbestos and asbestos-based products.  Flintkote sought bankruptcy protection in 2004 as a result of its exposure to asbestos-related lawsuits. Flintkote asserted that between 1988 and 2004, it defended and paid over 270,000 asbestos tort claims at a cost of about $630M.  It would be interesting if asbestos claims from people who are dying as a result of asbestos exposure were unable to be discharged, like student loans, they stay with you for life.

This action concerned an insurance policy Flintkote purchased from Aviva to cover general commercial liability, including liability for asbestos-related bodily injury claims. The Aviva policy was in force between Jan. 1, 1958 and Jan. 1, 1961.

Flintkote brought the present action to recover from Aviva defense and liability costs paid out as a result of asbestos-related tort claims brought against Flintkote.

• On April 14, 2004, Flintkote filed an action in San Francisco Superior Court against a bunch of insurance companies for not helping them defend and pay asbestos claims.
• Before the District Court were Aviva’s “Motion for Summary Judgment Regarding Assignments” as well as Flintkote’s “Motion to Streamline Damages Presentation at Trial.”

In addition to the Aviva policy, between 1942 and 1985, Flintkote purchased over 200 policies from some 30 separate insurance companies. Like the Aviva policy, two of these policies, issued by Liberty Mutual and American Mutual, were primary insurance policies. The remaining policies are excess insurance policies.  So everybody is getting sued and arguing over who is going to pay back Flintkote.

On Aviva’s motion for summary judgment, the Court found that:

• Flintkote was harmed by Aviva’s failure to pay on past claims insofar as other insurance was prematurely exhausted and was unavailable to pay on future claims;
• Under recently executed settlement agreements Flintkote had the authority to assert claims on behalf of its other insurers to recover amounts those insurers paid in lieu of Aviva; and
• The claims of the other insurers were equitably tolled.

On Flintkote’s motion for summary judgment, the District Court adopted a standard to determine damages.  Everyone play nice and pay up.