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North River Insurance Co. v. Mine Safety Appliances Co.

Court of Chancery of Delaware

December 20, 2013

THE NORTH RIVER INSURANCE COMPANY, Plaintiff,
v.
MINE SAFETY APPLIANCES COMPANY, Defendant.

Submitted Date September 20, 2013

Peter B. Ladig, Jason C. Jowers, and David J. Soldo, of MORRIS JAMES LLP, Wilmington, Delaware; OF COUNSEL: Alan S. Miller and Bridget M. Gillespie, of PICADIO SNEATH MILLER & NORTON, P.C., Pittsburgh, Pennsylvania, Attorneys for Plaintiff.

Brian C. Ralston, Jennifer C. Wasson, and Michael B. Rush, of POTTER ANDERSON & CORROON LLP, Wilmington, Delaware; OF COUNSEL: Mark A. Packman, Gabriel Le Chevallier, Jenna A. Hudson, and Katrina F. Johnson, of GILBERT LLP, Washington, DC, Attorneys for Defendant.

MEMORANDUM OPINION

GLASSCOCK, Vice Chancellor.

Litigation in multiple jurisdictions in consideration of a single issue can result in gross inefficiency, and risks inconsistent judgments. This Court has the power to enjoin litigants before it from litigating in other jurisdictions, where justice and equity so require. Exercise of this power involves often-vexing problems of comity, efficiency, and fairness. Anti-suit injunctions should be entered sparingly, and only where it is clear that irreparable harm is threatened, equity supports the exercise of injunctive relief, the relief sought will be effective if entered, and comity has been fully exercised.

Before me is an unusual request. An insurer has issued policies to a safety appliances company, providing liability insurance. That company faces a multitude of personal injury claims due to alleged defects in its safety equipment, and is seeking coverage under the insurer's policies. The insurer and insured have been entangled in various courts, litigating their respective rights and responsibilities under these policies, which are governed by Pennsylvania law. Whether coverage is available under the policies depends on whether the underlying injury arose—that is, was "triggered"—under the applicable coverage periods, as a matter of Pennsylvania law. That question is currently being litigated in the United States District Court for the Western District of Pennsylvania. It is also, in a separate action, before the Delaware Superior Court. Litigation before the latter court is partially stayed pending a decision from the Pennsylvania District Court on the "trigger" issue. Meanwhile, tort victims with whom the insured has settled are pursuing the coverage provided under the insurer's policies before a Circuit Court in West Virginia. The insured is participating in those actions, as well. Because the West Virginia litigation was later-filed, the insurer asks this Court to enjoin the insured from participating in these actions in supposed vindication of the Delaware Superior Court stay in favor of the Pennsylvania litigation.

In the matter before me, the Plaintiff, The North River Insurance Co. ("North River"), is requesting that this Court enter a permanent injunction preventing the Defendant, Mine Safety Appliances Co. ("MSA"), from prosecuting its later-filed claims in West Virginia, as well as from settling with tort plaintiffs by transferring rights to them under North River's insurance policies; assisting any claimants, absent court order, who are litigating against North River; or prosecuting any claims for coverage other than those actions pending in Pennsylvania and Delaware.[1] North River avers that, absent injunctive relief, it faces the irreparable harm of inconsistent judgments. Because this Court lacks jurisdiction over the tort plaintiffs in the pending West Virginia actions who may, under West Virginia law, continue to litigate the trigger issue in their declaratory judgment actions against North River, North River is seeking a remedy that would be inevitably ineffective at protecting it from the risk of inconsistent judgments. Because North River has asked this Court for a remedy that will not achieve its desired result, and because "[e]quity will not do a useless thing, "[2] North River has failed to demonstrate its entitlement to injunctive relief. In addition, it would be inequitable for this Court to grant such an injunction, which would result in North River continuing to litigate issues that will define MSA's rights as an insured, without MSA being able to vigorously defend itself. Because I find that the relief requested would not prevent the irreparable harm alleged, and because, in the particular circumstances here, the relief would itself create serious equitable concerns, MSA's Motion is granted, and that of North River is denied.

I. BACKGROUND

MSA, a Pennsylvania corporation, "manufactures a variety of safety products."[3] Many users of MSA safety products have brought bodily injury claims against the company, claiming they are "suffering various respiratory diseases such as asbestosis, silicoses and coal worker's pneumoconiosis ("CWP" or "Black Lung Disease") due to MSA's respiratory protection products."[4]

North River is a liability insurer incorporated in New Jersey.[5] MSA bought insurance coverage from North River and additional insurers to protect against personal injury claims.[6] As a result of the alleged defects in MSA safety equipment and the resulting tort claims that the company faces, MSA has sought costs such as legal fees, the cost of judgments, and settlement amounts from its various insurers.[7] Relevant to the matter before me, MSA and North River dispute the applicability and availability of certain North River excess insurance policies offering coverage between August 1972 through April 1986, [8] and have litigated these and related issues in Pennsylvania, Delaware, and, most recently, West Virginia.[9] North River and MSA dispute not only whether North River's policies are applicable to the injuries that MSA customers have developed but also the appropriate coverage trigger applicable to coal dust claims, with North River arguing that tort plaintiffs suffering from CWP were not "injured" during the periods for which North River's policies offer coverage.[10] The insurance policies at issue, the courts in which they are at issue, and their dates of coverage are represented graphically in Figure I. The procedural history of the various litigations at issue is tortuous, even torturous; to commend it to the reader of this Memorandum Opinion is akin to suggesting, to echo Justice Holmes, that he eat sawdust without butter. Nonetheless, an adumbration of that history is set out below, to the extent necessary to my decision here.

A. The Pennsylvania Actions

1. The Pennsylvania Federal Action

In March 2009, MSA sued North River for contract breach in the United States District Court for the Western District of Pennsylvania (the "Pennsylvania Federal Action").[11] In that litigation, MSA seeks a judgment that, in accordance with Policy JU 1225, "North River has a duty to both defend and indemnify MSA for the thousands of asbestos, silicosis and CWP claims filed against MSA."[12]North River subsequently filed a counterclaim in that action, seeking declaratory relief regarding the parties' rights and responsibilities under Policy JU 1255.[13]North River maintains that "none of the tendered claims involve bodily injury during the time that it provided coverage and, moreover, the terms of its policy exclude coverage for the type of injuries identified in the tendered claims."[14]2. The Pennsylvania State Action[15]In April 2010, North River filed an action for declaratory relief against MSA and other insurers in the Court of Common Pleas of Allegheny County (the "Pennsylvania State Action, " and collectively with the Pennsylvania Federal Action, the "Pennsylvania Actions").[16] Specifically, North River seeks a declaration of the parties' rights and responsibilities in regard to three excess insurance policies, Policies JU 0830, JU 0988, and JU 1123, [17] including whether the claims of MSA customers relate to injuries that were caused during the period when these policies were effective.[18] MSA filed its Answer, as well as New Matter (i.e. certain affirmative defenses), Counterclaims, and Crossclaims on June 18, 2010, asserting that North River failed "to honor the contractual and legal obligations [it] owes to MSA, " and acted in bad faith with respect to the CWP, asbestosis, and silicosis claims of MSA customers.[19] North River avers that the provisions of the policies at issue in Pennsylvania are "substantially similar" to Policy JU 1319.[20]

In November 2010, a federal judge authorized the use of a special discovery master to coordinate discovery in the Pennsylvania Actions; this master was appointed soon thereafter.[21] As of the time that North River filed its Complaint for permanent injunctive relief in this Court, the parties had conducted extensive discovery in the Pennsylvania Actions.[22] The parties had also filed cross-motions for summary judgment, and oral argument on the parties' motions was held March 12, 2013.[23] Issues to be resolved pursuant to the parties' cross-motions include the appropriate trigger for coverage as to coal dust claims, a matter governed by Pennsylvania ...


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