A Western District of Pennsylvania judge ruled in favor of supermarket and pharmacy chain Giant Eagle’s motion for partial summary judgment in an opinion issued earlier this week. The plaintiff had sued insurance providers American Guarantee and Liability Insurance Company (AGLIC) and XL Insurance Company, seeking a declaration that the insurance providers owe Giant Eagle a duty to defend it in cases arising from the opioid crisis.
In explaining the background of the case, Judge Robert J. Colville explained that Giant Eagle sought defense from the providers under its commercial liability policies it maintained with the defendants. Giant Eagle has been involved in litigation arising from the opioid crisis, including the large multidistrict litigation. The plaintiffs in that case “seek to recover damages from Giant Eagle for harm allegedly caused by Giant Eagle’s distribution and sale of prescription opioids,” the opinion explained.
The opinion explained that the insurance companies opposed coverage of Giant Eagle by arguing that the injuries arising from the lawsuit did not constitute “bodily harm” under the policy. The court disagreed, relying on parallel cases from other jurisdictions. The court next turned to the defendants’ arguments that the bodily injuries did not occur “by a single ‘occurence’ that takes place in the ‘coverage territory’ and occurs during the policy period.” The court again favored the plaintiffs, finding that the claims in the opioid litigation rely at least in part on Giant Eagle’s alleged negligence, thus constituting an “accident” and thus an occurrence under the policies. The court also rejected arguments that Giant Eagle could not determine that the occurrences at issue happened during the policy term.
The court also found that Giant Eagle’s costs constitute a “loss” that triggers the defendants’ policies’ duty to defend provisions. The judge found that the $5 million Giant Eagle said it paid in defense costs satisfied the deductibles and self-insured retention requirements, and concluded that “both AGLIC and XL owe Giant Eagle a defense in the underlying lawsuits, and summary judgment in Giant Eagle’s favor is warranted with respect to the issue of the duty to defend.”