In re Eastern Transmission Corp.
| Citation | 870 F. Supp. 1293 |
| Decision Date | 09 July 1992 |
| Docket Number | MDL No. 764. |
| Parties | In re TEXAS EASTERN TRANSMISSION CORPORATION PCB CONTAMINATION INSURANCE COVERAGE LITIGATION. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
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Peter J. Nickles, Coleman S. Hicks, Covington & Burling, Washington, DC, for Texas Eastern Transmission Corp.
Lawrence E. Carr, Jr., Margaret H. Warner, Carr, Goodson & Lee, P.C., Washington, DC, for Fidelity and Cas. Co. of New York, Boston Old Colony Ins. Co.
Mary Ann D'Amato, Robert M. Flannery, Mendes & Mount, New York City, for Certain Underwriters at Lloyd's of London, Ins. Co. of Ireland.
Regina A. Mapes, White & Williams, Philadelphia, PA, for Insurance Co. of North America.
Stephen Sonderby, Haskell & Perrin, Chicago, IL, for Continental Cas. Co.
Ignatius John Melito, Siff, Rosen & Parker, P.C., New York City, for First State Ins. Co.
Leonard L. Rivkin, John L. Rivkin, Erica Garay, Rivkin, Radler, Bayh, Hart & Kremer, Uniondale, NY, John C. Sullivan, Manta & Welge, Philadelphia, PA, for Associated Elec. & Gas Ins. Services, Ltd.
Stephen Cuyler, Michael J. Jones, Cuyler, Burk & Matthews, Morristown, NJ, for Employers Mut. Ins. Co.
Karen L. Douglas, Merlo, Chapello & Douglas, Ltd., Chicago, IL, for Prudential Reinsurance Co.
Edward M. Dunham, Jr., Miller Marvin Dunham Doering & Schreiber, Philadelphia, PA, for Aetna Cas. & Sur. Co.
David Richman, Pamela Ullman, Pepper, Hamilton & Scheetz, Philadelphia, PA, for The Home Ins. Co.
Marjorie Mintzer, Sheft & Sheft, New York City, Mitchell S. Pinsly, Margolis, Edelstein, Scherlis, Sarowitz & Kraemer, Philadelphia, PA, for American Home Assur. Co., Highlands Ins. Group, Ins. Co. of the State of Pennsylvania, Lexington Ins. Co., Ranger Ins. Co., Republic Ins. Co., Stonewall Underwriters, Inc.
Lorraine M. Armenti, McElroy, Deutsch & Mulvaney, Morristown, NJ, Thomas C. DeLorenzo, Marshall, Dennehey, Warner, Coleman & Goggin, Philadelphia, PA, for Intern. Ins. Co.
Lise Luborsky, Duane, Morris & Heckscher, Philadelphia, PA, for Pennsylvania Ins. Guar. Ass'n.
K. Thomas Shahriari, Gilberg & Kurent, Washington, DC, James M. Prahler, Partenheimer & Didomenicis, Philadelphia, PA, for Nat. Sur. Corp.
Texas Eastern Transmission Corporation (Texas Eastern), the owner-operator of a natural gas pipeline system extending from natural gas well fields in Texas, Louisiana, and the Gulf of Mexico to the New York metropolitan area, brought suit against approximately twenty-one insurance companies1 (the Carriers) that provided Texas Eastern with primary and excess comprehensive general liability (CGL) insurance coverage between 1958 and the present.2 Texas Eastern seeks to recover the expense that it will incur in the governmentally mandated environmental cleanup of polychlorinated biphenyl3 (PCB) contamination at multiple locations on Texas Eastern's property along the transmission line. The total costs are estimated to exceed $750 million. After more than two years of discovery, the parties have now filed cross-motions for summary judgment.
The present litigation consolidates three lawsuits, each seeking declaratory judgment as to the respective duties and liabilities of the Carriers to defend and/or indemnify Texas Eastern against claims and settlements made by and with the United States Environmental Protection Agency (EPA), various state agencies, and private parties.4
On December 11, 1987, Fidelity & Casualty Company of New York (Fidelity or F & C), Texas Eastern's primary CGL carrier throughout all relevant periods, filed Case No. 87-2925T against Texas Eastern in the United States District Court for the Northern District of Texas (Northern District action). The Northern District action was a diversity case establishing federal subject-matter jurisdiction pursuant to 28 U.S.C. § 1332.
On March 11, 1988, Associated Electric & Gas Insurance Services Limited (Aegis) and National Surety Corporation filed Civil Action No. 88-2126 in the United States District Court for the Eastern District of Pennsylvania (Eastern District action) against Texas Eastern, F & C, and Texas Eastern's other CGL insurers. Jurisdiction was based on 28 U.S.C. §§ 1330(a), 1603(a), and 1605(a)(2) of the Foreign Sovereign Immunities Act (FSIA), because one of the insurers, the Insurance Company of Ireland (one of the London Market Insurers), was an instrumentality of a foreign state.
On March 21, 1988, Texas Eastern filed an action in Texas state court, in Houston (Texas state court action), against all of its insurers.5 The Texas state...
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