Firm News

LORDA Assists CGL Insurer in Obtaining a Substantial Recovery from a Pollution Insurer in Final 9-11 Mass Action

This result emanated from the navigation and negotiation of multiple insurers providing different lines of coverage with multiple layers over seven years of potential coverage. LORDA Principal, Bob Allen, represented a CGL carrier as its coverage counsel in connection with hundreds of bodily injury claims against one of the major commercial remediation companies involved in the clean-up of dozens of buildings surrounding Ground Zero in the aftermath of the 9-11 Terrorist Attack.

The underlying litigation is the final 9-11 related mass-tort action, comprised of the bodily injury suits brought by the workers employed to clean up the office buildings surrounding Ground Zero. These suits were consolidated for Pre-Trial handling in the Southern District of New York before the venerable Alvin Hallerstein. The Defendants are the building owners and commercial cleaning and restoration providers who allegedly failed to provide the workers with adequate masks and protective gear for the clean up operation.

Complex insurance coverage issues arose from the different lines of liability coverage (Commercial General and Contractors Pollution) with multiple layers of coverage requiring allocation over seven potential policy periods. For example, the difference between applying New York law (location of the occurrence) and Texas law (home of the insured) was outcome determinative on whether coverage was excluded under the CGL policies’ Pollution Exclusion clauses. The allocation scheme was likewise complicated by the choice of law because of the differences between the New York and Texas approaches. During the prolonged negotiations with the insured and the other potentially responsible insurers, a Southern District federal judge ruled that Texas law applied. The resulting compromise led to a significant recovery for the LORDA clients from one of the Contractors Pollution Liability carriers.