Case Notes

U.S. Fire countered that its policies' exception from liability for “pollution” incidents applied. The primary question for the courts was, therefore, whether the release of asbestos from the LGS gaskets constituted “pollution.” The district court determined that it did not, and declared U.S. Fire liable. On appeal, the Fifth Circuit began its discussion by stating, “Neither this court nor the Texas Supreme Court has ever determined whether asbestos is a pollutant.” To find out if it was, the court first looked to the plain meaning of the contract terms, which define “pollutant” as an “irritant,” “contaminant” or “pollutant,” and observed that asbestos is both an irritant and a contaminant.

The Fifth Circuit next looked to the holdings of other jurisdictions, some of which have deemed asbestos a pollutant (i.e., Ohio) and others of which have not (i.e., New York). In the end, the court stated, “[t]hough the case law is mixed, we conclude, under the plain language of the policy exclusion, that asbestos constitutes a pollutant and an irritant. Accordingly, the underlying claims fall under the pollution exclusion because they: (1) were for bodily injury; (2) arose out of the discharge, dispersal, release, or escape, into the atmosphere; (3) and originated with an irritant and pollutant — namely, asbestos.” As the pollution exclusion applied to LGS's policy with U.S. Fire, the Fifth Circuit held that, on remand, Trinity will have the burden of showing that an exception to the exclusion exists if it wants to receive contribution from U.S. Fire.

New York Appeals Court Upholds Dismissal of Mirena MDL

The U.S. Court of Appeals for the Second Circuit has upheld the summary judgment dismissal of the multidistrict lawsuit (MDL) against the maker of the intrauterine birth control device Mirena after finding that none of the experts proffered by the nearly 1,300 plaintiffs were reliable. Mirena MDL v. Bayer Healthcare Pharmaceuticals Inc., 2017 U.S. App. LEXIS 20875 (2nd Cir. 10/24/17).

Plaintiffs all claimed they were injured by the implantable intrauterine birth control device, marketed by Bayer under the name Mirena. All parties agreed that it was possible for a user's uterus to be injured during the insertion of the device, but the plaintiffs claimed that their injuries did not occur at insertion but later on, because the device migrated and perforated their uteruses. The plaintiffs presented three expert witnesses to back up their claims that the device migrated after insertion, but the U.S. District Court for the Southern District of New York found all three unreliable. Specifically, District Court Judge Cathy Siebel found that none of the experts had done any research on the question of Mirena device migration prior to being being hired by the plaintiffs, and all assumed that the women's explanation of the cause of their injuries was valid. According to Judge Siebel, the plaintiffs' experts accepted this explanation, then “worked backwards to hypothesize a mechanism by which it might occur.”

The Second Circuit panel, made up of Judges John Walker Jr., Jose Cabranes and Reena Raggi, affirmed after finding that the expert testimony offered did not meet the test for admissibility found in Daubert v. Merrell Dow Pharmaceuticals. One of the criteria in Daubert— that the expert's theory is one that had been accepted by the relevant scientific community — seemed particularly troubling to the appeals court, as it was shown that the obstetrics and gynecological community has not accepted that the “secondary perforation” the plaintiffs claimed is something that actually occurs. On this point, the court concluded that “[n]ot only do the experts fail to identify any authorities that directly support the existence of secondary perforation, but what scientific authority there is casts doubt on the phenomenon's existence.”

Asbestos: Pollutant or Not?

The U.S. Court of Appeals for the Fifth Circuit has reversed a Texas District Court's decision that held that asbestos contamination is not pollution; this decision affects the relationship of two insurance carriers to liability for defending and indemnifying a hardware manufacturer whose products contained and allegedly released asbestos. Longhorn Gasket and Supply Co. v. United States Fire Insurance Co., 2017 U.S. App. LEXIS 15706 (5th Cir. 8/18/17).

Longhorn Gasket and Supply Company (LGS) manufactured and sold gaskets — some containing asbestos — during the 1980s and 1990s. LGS has been sued in several lawsuits by claimants alleging exposure to asbestos dust from its products. During the relevant years of production, LGS maintained primary and excess insurance coverage with Trinity Lloyd's Insurance Company and Trinity Universal Insurance Company (Trinity) and United States Fire Insurance Company (U.S. Fire). In 2007, LGS sued U.S. Fire for breach of contract for that company's refusal to acknowledge the applicability of coverage under its policies; LGS also sought declaratory judgment that U.S. Fire was responsible for providing coverage to it. Trinity intervened in the suit, seeking contribution from U.S. Fire for coverage it must provide to LGS in the underlying claims.

U.S. Fire countered that its policies' exception from liability for “pollution” incidents applied. The primary question for the courts was, therefore, whether the release of asbestos from the LGS gaskets constituted “pollution.” The district court determined that it did not, and declared U.S. Fire liable. On appeal, the Fifth Circuit began its discussion by stating, “Neither this court nor the Texas Supreme Court has ever determined whether asbestos is a pollutant.” To find out if it was, the court first looked to the plain meaning of the contract terms, which define “pollutant” as an “irritant,” “contaminant” or “pollutant,” and observed that asbestos is both an irritant and a contaminant.

The Fifth Circuit next looked to the holdings of other jurisdictions, some of which have deemed asbestos a pollutant (i.e., Ohio) and others of which have not (i.e., New York). In the end, the court stated, “[t]hough the case law is mixed, we conclude, under the plain language of the policy exclusion, that asbestos constitutes a pollutant and an irritant. Accordingly, the underlying claims fall under the pollution exclusion because they: (1) were for bodily injury; (2) arose out of the discharge, dispersal, release, or escape, into the atmosphere; (3) and originated with an irritant and pollutant — namely, asbestos.” As the pollution exclusion applied to LGS's policy with U.S. Fire, the Fifth Circuit held that, on remand, Trinity will have the burden of showing that an exception to the exclusion exists if it wants to receive contribution from U.S. Fire.

New York Appeals Court Upholds Dismissal of Mirena MDL

The U.S. Court of Appeals for the Second Circuit has upheld the summary judgment dismissal of the multidistrict lawsuit (MDL) against the maker of the intrauterine birth control device Mirena after finding that none of the experts proffered by the nearly 1,300 plaintiffs were reliable. Mirena MDL v. Bayer Healthcare Pharmaceuticals Inc., 2017 U.S. App. LEXIS 20875 (2nd Cir. 10/24/17).

Plaintiffs all claimed they were injured by the implantable intrauterine birth control device, marketed by Bayer under the name Mirena. All parties agreed that it was possible for a user's uterus to be injured during the insertion of the device, but the plaintiffs claimed that their injuries did not occur at insertion but later on, because the device migrated and perforated their uteruses. The plaintiffs presented three expert witnesses to back up their claims that the device migrated after insertion, but the U.S. District Court for the Southern District of New York found all three unreliable. Specifically, District Court Judge Cathy Siebel found that none of the experts had done any research on the question of Mirena device migration prior to being being hired by the plaintiffs, and all assumed that the women's explanation of the cause of their injuries was valid. According to Judge Siebel, the plaintiffs' experts accepted this explanation, then “worked backwards to hypothesize a mechanism by which it might occur.”

The Second Circuit panel, made up of Judges John Walker Jr., Jose Cabranes and Reena Raggi, affirmed after finding that the expert testimony offered did not meet the test for admissibility found in Daubert v. Merrell Dow Pharmaceuticals. One of the criteria in Daubert— that the expert's theory is one that had been accepted by the relevant scientific community — seemed particularly troubling to the appeals court, as it was shown that the obstetrics and gynecological community has not accepted that the “secondary perforation” the plaintiffs claimed is something that actually occurs. On this point, the court concluded that “[n]ot only do the experts fail to identify any authorities that directly support the existence of secondary perforation, but what scientific authority there is casts doubt on the phenomenon's existence.”