Welcome to Reuters Legal News beta. Please enjoy and provide us with your feedback as we continue to improve the Reuters Legal News experience.
A Rite Aid store at 1841 North Western Avenue is shown at in Los Angeles, California, U.S., January 21, 2020. REUTERS/Mike Blake
The company and law firm names shown above are generated automatically based on the text of the article. We are improving this feature as we continue to test and develop in beta. We welcome feedback, which you can provide using the feedback tab on the right of the page.
The Delaware Supreme Court on Monday ruled that insurance company Chubb Ltd is not required to provide coverage and defend Rite Aid Corp in lawsuits accusing the pharmacy chain operator of fueling the opioid epidemic.
The ruling came in one of several disputes nationwide involving pharmaceutical companies, drug distributors and pharmacies suing insurers in order to recoup the costs of defending against and settling thousands of opioid lawsuits.
A lower-court judge in 2020 found that various Chubb subsidiaries were required to defend Rite Aid against bellwether lawsuits by two Ohio counties in the federal multidistrict litigation over the epidemic.
But Delaware's top court reversed, concluding that policies covering personal injury cases did not require Chubb to defend Rite Aid against lawsuits seeking only economic damages.
Rite Aid and its lawyer, Gerald Konkel of Morgan, Lewis & Bockius, did not respond to requests for comment. Chubb and its lawyers, including Jonathan Hacker of O'Melveny & Myers, had no comment.
More than 3,000 lawsuits have been filed nationally by largely state and local governments seeking to hold the companies responsible for an opioid abuse crisis that has led to hundreds of thousands of overdose deaths.
The lawsuits accuse Rite Aid of negligently distributing addictive prescription pain pills. The company denies wrongdoing, and in 2019 sued Chubb to recover the costs of its defense and future settlements.
In Monday's ruling, Chief Justice Collins Seitz, said that for Rite Aid to receive coverage, the lawsuits needed to be brought by people injured by opioids – individuals suing on their own behalf or anyone who cared for or treated them.
But in the case of Ohio's Summit and Cuyahoga counties, which brought opioid claims similar to other local governments, they specifically said they were not seeking recovery for any residents' personal injuries, Seitz said.
They instead sued to recover for injuries the counties suffered by being saddled with the economic burden of higher demands for medical treatment and impacts on their criminal justice systems, Seitz wrote for the 4-1 court.
"This claim is not directed to an individual injury but to a public health crisis," Seitz said.
Justice James Vaughn dissented, saying Chubb's policy language should be interpreted broadly to cover all damages an organization could bring against Rite Aid for the care, loss of services or death of someone due to opioid addiction.
The case is ACE American Insurance Co, v. Rite Aid Corp, Delaware Supreme Court, No. N19C-04-150.
For Chubb: Jonathan Hacker of O'Melveny & Myers
For Rite Aid: Gerald Konkel of Morgan, Lewis & Bockius
Read more:
State supreme court overturns broad bar against insurers suing over opioid coverage
Pharmacy chains including CVS helped fuel opioid epidemic, U.S. jury finds
(This article has been corrected to fix the list of lawyers in the final paragraphs.)
Our Standards: The Thomson Reuters Trust Principles.
Nate Raymond reports on the federal judiciary and litigation. He can be reached at nate.raymond@thomsonreuters.com.
Subscribe for our daily curated newsletter to receive the latest Reuters legal news and headlines delivered to your inbox.
Reuters, the news and media division of Thomson Reuters, is the world’s largest multimedia news provider, reaching billions of people worldwide every day. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers.
Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology.
The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs.
The industry leader for online information for tax, accounting and finance professionals.
Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile.
Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts.
Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks.
All quotes delayed a minimum of 15 minutes. See here for a complete list of exchanges and delays.
© 2021 Reuters. All rights reserved
Menu
