Ruling on Injury Lawsuits Is Victory for Asbestos Companies
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In a victory for asbestos companies facing huge losses from personal-injury lawsuits, the New York State Court of Appeals ruled today that insurers are obligated to pay the companies’ often considerable legal fees in defending the cases. The decision could save tens of millions of dollars for New York companies with outstanding asbestos claims snaking their way through the court system. But it is a blow to the insurance industry, which has been arguing that it is not obligated to defend companies in asbestos-related personal-injury cases. Taking up an issue that is being debated around the country, New York’s highest court ruled, 5 to 0, that asbestos is not environmental pollution comparable to chemicals leaking from underground tanks or toxic fumes spewing from smokestacks. That finding was essential because insurance companies typically are not required to insure companies against claims of damage from pollution, and the Court of Appeals has held in similar cases in the past that corporate polluters, not insurers, were liable. The ruling did not take up the issue of who is ultimately responsible for paying the victims of asbestos-caused injuries — the companies or the insurers. But its decision will make it harder for insurers to argue that asbestos is a type of pollution and that they are thus exempt from payments. ‘A Major Impact’ “This landmark decision will have a major impact on asbestos litigation and will affect manufacturers and insurers who face massive liability for asbestos-related injury claims,” said Stephen Marshall, who represented the asbestos manufacturer in the case. The case was brought by two Chicago insurers, Continental Casualty Company and Transportation Insurance Company, which argued that they were not obligated to pay the legal fees of a New York City company, the Rapid-American Corporation, in asbestos cases. More : query.nytimes.com |