CENTURY INDEMNITY COMPANY v. LIBERTY MUTUAL INSURANCE COMPANY Complaint

8/4/2019 CENTURY INDEMNITY COMPANY v. LIBERTY MUTUAL INSURANCE COMPANY Complaint

http://slidepdf.com/reader/full/century-indemnity-company-v-liberty-mutual-insurance-company-complaint 1/6

Case 1:09-cv-00285-S-LDA Document 1 Filed 06/29/09 Page 1 of 6 PagelD #: 1

UNITED STATES DISTRICT COURTDISTRICT OF RHODE ISLAND

CENTURY INDEMNITY COMPANY,

Plaintiff,

LIBERTY MUTUAL INSURANCECOMPANY,

Defendant.

CIVIL At^aiNO .

COMPLAINT

Plaintiff Century Indemnity Company, by its attorneys, for its Complaint against

defendant Liberty M utual Insurance C ompany, says:

PARTIES

1. Century Indemnity Company, as successor to CCI Insurance Company, as

successor to Insurance Company of North A merica ("Ce ntury"), is a Pennsylvania corporation

with its principal place of business in Philadelphia, Pennsylvania.

2. On information and belief, Liberty M utual Insurance Company ("Liberty

Mutual") is a M assachusetts corporation with its principal place of business in Boston,

Massachusetts.

JURISDICTION AND VENU E

3. This Court has jurisdiction over this matter pursuant to 28 U.S.C . § 1332,

diversity of citizenship, because Century and Liberty M utual are citizens of different states and

the amount in controversy is in excess of $75,000.




4. This Court has personal jurisdiction over Liberty M utual because Liberty

Mutual has been registered to do business and has transacted business in Rhode Island.

5. Venue in this district is appropriate because a substantial part of the events

or omissions giving rise to this claim occurred in this district.

ANTECEDENT LITIGATION

6. As set forth in greater detail below, this case arises out of a previous

insurance coverage action in this court, styled, Emhart Industries, Inc v. Home Insurance C o., et

al., Case No. 02-053S, in which Em hart Industries Inc. ("Emhart") sought a declaratory judgm ent

against several insurers for insurance coverage including defense costs and indemnity resulting

from an EPA ordered remediation at Emhart's former m anufacturing site in North P rovidence,

Rhode Island. Emhart's claims for coverage were based on insurance policies issued to Emhart's

predecessors over several decades by several defendants, including Century and Liberty Mu tual.

7. Emhart settled with Liberty Mutual. Century prevailed w ith respect to

indemnity, but was found liable for and ordered to pay defense costs.

8. In this case, Century seeks the equitable remedy of contribution because it

was forced to pay m ore than its equitable share of Em hart's defense costs and Liberty M utual did

not pay its equitable share of Emhart's defense costs.

FACTS

9. Century issued a primary and an excess policy to Crown-M etro, Inc., an

indirect predecessor to Emhart. The primary policy was in effect from February 15, 1969 to

January 1,1970 and had a $100,000 coverage limit. The excess policy was in effect for thirteen

months from December 1,1968 to January 1, 1970. The limits under that policy were $1 million

in excess of $100,000.




10. Liberty Mutual issued eight successive primary policies to USM

Corporation, a direct predecessor of Em hart. The policies were in effect from N ovember 1,1971

to January 1, 1979. The limits under each policy were $2 million. Each policy included a duty

to defend U SM Corporation.

11. In July 1999, Emhart gave Liberty Mutual notice of a claim the EPA had

asserted against Emhart based on dioxin contamination at the C entredale M anor R estoration

Superfund Site in North Providence, Rhode Island (the "Site"). Emhart demanded that Liberty

Mutual provide a defense and indemnify Emhart based on the po licies Liberty M utual issued to

USM Corporation.

12. In May 200 0, Liberty M utual advised Emhart that Liberty M utual would

not be providing Emhart w ith a defense or indemnification because Liberty M utual claimed there

was no potential obligation to defend or indemnify.

13 . In January 2002, Emhart comm enced an action in the United States

District Court for the District of Rhode Island, Civil Action No. 02-053 S, against C entury,

Liberty M utual, and other insurers seeking insurance coverage for the EP A 's claim against

Emhart and its predecessors based on the dioxin contamination at the Site. Emhart sought a

declaratory judgment and damages for breach of contract against Century under the policies

Century issued to Crown-M etro and against Liberty M utual under the policies L iberty Mutual

issued to USM Corporation.

14. With their respective answers to Emhart's complaint, Century and Liberty

Mutual each filed cross-claims against the other seeking equitable allocation in the event the

court were to enter judgment in favor of Em hart against one or both of them. The district court




later entered orders preserving the right to assert or reassert cross-claims until thirty days

following the date of entry of a final judgm ent, including all appeal periods.

15. Liberty Mutual filed a motion for summ ary judgm ent seeking a

declaration it had no duty to defend E mhart. The magistrate jud ge recomm ended that Liberty

Mutual's motion be denied.

16. In March 200 5, Black & D ecker (Emhart's corporate parent) and Liberty

M utual entered into a global settlement agreemen t which encom passed m ore than eighty (80)

sites. In that settlement agreem ent, Liberty Mu tual and Emhart attributed only $250,000 to

defense costs relating to the S ite. The Liberty Mutual settlement contained n o release of

Emhart's claims against Century.

17. Upo n the settlement, the district court dismissed Em hart's claims against

Liberty Mutual with prejudice and dismissed Cen tury's cross-claim against Liberty Mutual

without prejudice.

18. On November 16, 200 7, the district court entered judg me nt ag ainst

Century in favor of Em hart in the am ount of $4,211,186.66 for defense c osts, plus pre-judgm ent

interest in the amount of $1,533,911.63, plus post-judgment interest at a rate to be calculated in

accordance with 28 U.S.C. § 1961.

19. Century filed a timely ap peal from the co urt's judgment. The U nited

States Court of Appeals for the First Circuit affirmed. On M ay 1, 200 9, the First Circuit issued

its man date.

20. On May 14,20 09, Century paid Emhart $6,067,290.11 in full satisfaction

of the judgment.




EQUITABLE CONTRIBUTION

21. Century is entitled to equitable contribution from Liberty Mutual. Liberty

Mutual had a duty to defend Emhart in connection with the EPA's claim against Emhart based

on the dioxin contamination at the Site. Century has paid more than its equitable share of the

defense costs and Liberty Mutual has not paid its equitable share.

WHEREFORE, Century respectfully requests that the Court enter judgment in its

favor against Liberty Mutual in an amount the Court determines to be equitable based on a

comparison of the number of months and limits of Century's policies issued to Crown-Metro

with the number of months and limits of Liberty Mutual's policies issued to USM Corporation,

plus interest, costs, and attorneys' fees.

Dated: June 26,2009

sT.McCormick(#2614)

E N N A & MCCORMICK

128 Dorrance Street, Suite 330

Providence, RI 02903

(401)831-2970

(401) 751-1797 Fax

[email protected]

Of Counsel Lawrence A. Nathanson

Siegal & Park

533 Fellowship Road, Suite 120

Mt. Laurel, NJ 08054(856) 380-8910

mailto:[email protected]

mailto:[email protected]




John L. Altieri, Jr.Boutin & A ltieri, P.L.L.C.1261 Post RoadFairfield, CT 06824

(203) 292-6882

CENTURY INDEMNITY COMPANY v. LIBERTY MUTUAL INSURANCE COMPANY Complaint

Documents