6th Circ. Geared Up for Next Opioid Coverage Dispute
Arguments before the Sixth Circuit in consolidated opioid coverage disputes on Thursday could lead to a ruling continuing the trend that insurers have no duty to defend underlying government public nuisance actions over the epidemic because of a lack of alleged bodily injuries.
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Seth Lamden of Blank Rome LLP told Law360 that a ruling adverse to policyholders will not be binding on state court jurists who have not specifically weighed in on opioid coverage disputes.
"Ultimately, this is just the Sixth Circuit's efforts to predict Kentucky insurance law," he explained. "So, the decision may be persuasive, but it's not binding on state courts."
He also said that opioid coverage disputes highlight the importance of choice of law.
"There are numerous jurisdictions where there may have been a different result in the trial court," said Lamden, who represents policyholders. "The idea that CGL policies cover economic losses resulting from property damage or bodily injury isn't new."
Moreover, he also said it's "risky to talk about opioid lawsuits as a blanket category of claims," explaining that each case must be evaluated based on the specific allegations in the underlying complaint and policy terms.
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Blank Rome's Lamden agreed that defense costs add up quickly.
"There's no question that defense costs can sometimes outweigh the amount of damages or a settlement," he said. "It's crucial for these companies to be able to mount an effective defense funded by their insurers. Defense costs can be crushing."
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"6th Circ. Geared Up for Next Opioid Coverage Dispute," by Shane Dilworth was published in Law360 on October 19, 2022.