Delaware Superior Court Says Rite Aid Cannot Obtain Insurance Coverage for Opioid Cases

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A Rite Aid store at 1841 North Western Avenue is pictured in Los Angeles, California, U.S., January 21, 2020. REUTERS/Mike Blake

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  • Delaware Supreme Court Rules Chubb in Rite Aid Coverage Lawsuit
  • Court says Rite Aid is only entitled to cover in bodily injury cases

The Delaware Supreme Court ruled on Monday that insurance company Chubb Ltd was not required to provide coverage and defend Rite Aid Corp in lawsuits accusing the drugstore chain operator of fueling the coronavirus epidemic. opioids.

The decision came in one of several nationwide disputes involving pharmaceutical companies, drug distributors and pharmacies suing insurers to recoup the costs of defending and settling thousands of opioid lawsuits.

A 2020 lower court judge found that various Chubb subsidiaries were required to defend Rite Aid against lawsuits brought by two Ohio counties in the multidistrict federal outbreak litigation.

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But Delaware’s highest court backtracked, finding that policies covering personal injury cases did not require Chubb to defend Rite Aid against lawsuits seeking economic damages only.

Rite Aid and its attorney, Gerald Konkel of Morgan, Lewis & Bockius, did not respond to requests for comment. Chubb and his attorneys, including Jonathan Hacker of O’Melveny & Myers, had no comment.

More than 3,000 lawsuits have been filed nationwide by largely state and local governments seeking to hold companies accountable 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 painkillers. The company denies wrongdoing and in 2019 sued Chubb to recover costs of its defense and future settlements.

In Mondays decisionChief Justice Collins Seitz, said that for Rite Aid to have coverage, lawsuits had to be brought by people injured by opioids – people suing on their own behalf or anyone who treated or treated them.

But in the case of Summit and Cuyahoga counties in Ohio, which filed similar opioid claims with other local governments, they specifically said they were not seeking redress for residents’ personal injuries. , Seitz said.

Instead, they sued to recover injuries suffered by counties grappling with the economic burden of higher demands for medical care and the impacts on their criminal justice systems, Seitz wrote for the 4-1 court. .

“This claim is not for an individual injury but a public health crisis,” Seitz said.

Judge James Vaughn dissented, saying Chubb’s policy wording should be interpreted broadly to cover any damages an organization might inflict on Rite Aid for the care, loss of services or death of an individual. a person due to an 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 strikes down broad bar against insurers suing opioid coverage

Pharmacy chains including CVS helped fuel opioid epidemic, US jury finds

(This article has been corrected to fix the list of lawyers in the last paragraphs.)

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Reporting by Nate Raymond in Boston

Our standards: The Thomson Reuters Trust Principles.

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