Insurance Antitrust Litigation, In re, Nos. 89-16405

CourtUnited States Courts of Appeals. United States Court of Appeals (9th Circuit)
Writing for the CourtBefore BEEZER and NOONAN; NOONAN
Citation938 F.2d 919
Parties, 1991-1 Trade Cases 69,460 In re INSURANCE ANTITRUST LITIGATION. ACE CHECK CASHING, INC.; Acme Corrugated Box Company, Inc.; Anastasios Markos, t/a Municipal Exxon; Bay Harbor Park Homeowner's Association, Inc.; Bensalem Township Authority; Big D Building Supply Corporation, et al., Private Plaintiffs, Plaintiffs-Appellants, and State of Alabama, et al., Plaintiffs, v. AETNA CASUALTY AND SURETY COMPANY; Allstate Insurance Company; Cigna Corp.; Hartford Fire Insurance Company, et al., Defendants-Appellees. STATE OF CALIFORNIA; City of Lafayette; City and County of San Francisco; County of San Benito, Plaintiffs-Appellants, and State of Alabama, et al., Plaintiffs, v. AETNA CASUALTY AND SURETY COMPANY; Allstate Insurance Company; Cigna Corp.; Hartford Fire Insurance Company, et al., Defendants-Appellees. STATE OF CALIFORNIA; City of Lafayette; City and County of San Francisco; County of San Benito, Plaintiffs-Appellants, v. INSURANCE SERVICES OFFICE, INC., CNA RE (U.K.) Ltd.; Continental Reinsurance Corporation; Union-America Insurance Co.; Edwards & Payne Ltd.; Excess Insurance Co., Ltd.; General Reinsurance Corp.; Thomas A. Greene & Company, Inc.; Kemper Reinsurance London; Lloyd's Underwriters & Brokers; Mercantile & General Reinsurance Company of America; North American Reinsurance Corporation; Oxford Syndicate Mgmt. Ltd.; (sued herein as K.F. Adler & Others (U.A.) Ltd.); Prudential Reinsurance; Reinsurance Association of America; Terra Nova Insurance Co.; Aetna Casualty and Surety Company; Allstate Insurance Company; Winterthur Reinsurance Corporation of America; Cigna Corp.; Hartford Fire Insurance Company, Defendants-Appellees. STATE OF NEW YORK; Roosevelt Island Operating Authority; Village of Groton; Village of Lake Success, Plaintiffs-Appellants, v. HARTFORD FIRE INSURANCE COMPANY; Aetna Casualty and Surety Company; Cigna Corp.; Allstate Insurance; et al., Defendants-Appellees. COMMONWEALTH OF MASSACHUSETTS; Town of Hanover; Town of Milford, Plaintiffs-Appe
Docket Number89-16513,Nos. 89-16405
Decision Date18 June 1991

Page 919

938 F.2d 919
60 USLW 2017, 1991-1 Trade Cases 69,460
In re INSURANCE ANTITRUST LITIGATION.
ACE CHECK CASHING, INC.; Acme Corrugated Box Company, Inc.;
Anastasios Markos, t/a Municipal Exxon; Bay Harbor Park
Homeowner's Association, Inc.; Bensalem Township Authority;
Big D Building Supply Corporation, et al., Private
Plaintiffs, Plaintiffs-Appellants,
and
State of Alabama, et al., Plaintiffs,
v.
AETNA CASUALTY AND SURETY COMPANY; Allstate Insurance
Company; Cigna Corp.; Hartford Fire Insurance
Company, et al., Defendants-Appellees.
STATE OF CALIFORNIA; City of Lafayette; City and County of
San Francisco; County of San Benito, Plaintiffs-Appellants,
and
State of Alabama, et al., Plaintiffs,
v.
AETNA CASUALTY AND SURETY COMPANY; Allstate Insurance
Company; Cigna Corp.; Hartford Fire Insurance
Company, et al., Defendants-Appellees.
STATE OF CALIFORNIA; City of Lafayette; City and County of
San Francisco; County of San Benito, Plaintiffs-Appellants,
v.
INSURANCE SERVICES OFFICE, INC., CNA RE (U.K.) Ltd.;
Continental Reinsurance Corporation; Union-America
Insurance Co.; Edwards & Payne Ltd.; Excess Insurance Co.,
Ltd.; General Reinsurance Corp.; Thomas A. Greene &
Company, Inc.; Kemper Reinsurance London; Lloyd's
Underwriters & Brokers; Mercantile & General Reinsurance
Company of America; North American Reinsurance Corporation;
Oxford Syndicate Mgmt. Ltd.; (sued herein as K.F. Adler &
Others (U.A.)
Ltd.); Prudential Reinsurance; Reinsurance Association of
America; Terra Nova Insurance Co.; Aetna Casualty and
Surety Company; Allstate Insurance Company; Winterthur
Reinsurance Corporation of America; Cigna Corp.; Hartford
Fire Insurance Company, Defendants-Appellees.
STATE OF NEW YORK; Roosevelt Island Operating Authority;
Village of Groton; Village of Lake Success,
Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Aetna Casualty and Surety
Company; Cigna Corp.; Allstate Insurance; et
al., Defendants-Appellees.
COMMONWEALTH OF MASSACHUSETTS; Town of Hanover; Town of
Milford, Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Aetna Casualty and Surety
Company; Cigna Corp.; Allstate Insurance; et
al. Defendants-Appellees.
STATE OF MINNESOTA, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Aetna Casualty and Surety
Company; Cigna Corp.; Allstate Insurance; et
al., Defendants-Appellees.
STATE OF WEST VIRGINIA; City of Clay; County of Hancock;
County of Mineral; County of Wirt, Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Aetna Casualty and Surety
Company; Cigna Corp.; Allstate Insurance; et
al., Defendants-Appellees.
STATE OF WISCONSIN, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Aetna Casualty and Surety
Company; Cigna Corp.; Allstate Insurance; et
al., Defendants-Appellees.
CITY OF MOBILE; State of Alabama; City of Birmingham,
Plaintiffs-Appellants,
v.
AETNA CASUALTY AND SURETY COMPANY; Winterthur Reinsurance
Corporation of America; Cigna Corp.; Hartford
Fire Insurance Company; Allstate
Insurance, Defendants-Appellees.
STATE OF ARIZONA, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF MARYLAND, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF WASHINGTON; County of Cowlitz, Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF NEW JERSEY, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF COLORADO, Plaintiff-Appellant,
v.
WINTERTHUR REINSURANCE CORPORATION OF AMERICA; Aetna
Casualty and Surety Company; Cigna Corp.;
Hartford Fire Insurance Company;
Allstate Insurance,
Defendants-Appellees.
STATE OF OHIO; Township of Jackson; County of Hardin,
Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF CONNECTICUT, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
COMMONWEALTH OF PENNSYLVANIA; County of Schuylkill; City
of Altoona; City of York; Borough of
Chambersburg, Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF ALASKA, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF MONTANA; County of Teton, Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF MICHIGAN, Plaintiff-Appellant,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
STATE OF LOUISIANA, Cities of Baton Rouge, New Orleans,
Slidell, Nachitoches and Eunice, Plaintiffs-Appellants,
v.
HARTFORD FIRE INSURANCE COMPANY; Allstate Insurance; Aetna
Casualty and Surety Company; Cigna Corp.; et
al., Defendants-Appellees.
Nos. 89-16405, 89-16513 to 89-16531.
United States Court of Appeals,
Ninth Circuit.
Argued and Submitted March 15, 1991.
Decided June 18, 1991.

Page 922

Thomas Greene, Deputy Atty. Gen., San Francisco, Cal., H. Ladie Montague, Philadelphia, Pa., for plaintiffs-appellants.

Laurel Price, Deputy Atty. Gen., Trenton, N.J., for State plaintiffs-appellants.

Bartlett H. McGuire, Davis, Polk & Wardwell, Washington, D.C., John Harkins, Philadelphia, Pa., Martin Evans, New York City, for defendants-appellees.

Edwin A. Heafey, Jr., Raoul D. Kennedy and Richard de Saint Phalle of Crosby, Heafey, Roach & May, Oakland, Cal., defendants-appellees' liaison counsel.

Appeal from the United States District Court for the Northern District of California.

Before BEEZER and NOONAN, Circuit Judges, and SINGLETON, * District Judge.

NOONAN, Circuit Judge:

Nineteen states and numerous private parties brought antitrust suits against the defendants named above. These suits were consolidated in the district court and were ultimately dismissed. The plaintiffs appeal. We reverse the district court and remand.

FACTUAL BACKGROUND

The undisputed facts are set out by the district court in In re Insurance Antitrust Litigation, 723 F.Supp. 464, 468-70 (N.D.Cal.1989). We summarize:

Commercial general liability insurance (CGL) protects the insured against the risk of liability to third parties for bodily injury or property damage. It is purchased by businesses, nonprofit entities, and governmental units. Defendants Hartford Fire Insurance Company (Hartford), Allstate Insurance Company (Allstate), Aetna Casualty and Surety Company (Aetna), and CIGNA Corporation (CIGNA) are sellers of CGL.

In distinction from these primary insurers, there are reinsurers to whom the primary insurers turn to share their risk. The terms and availability of reinsurance directly affect the terms and availability of primary insurance. In turn, retrocessional insurance--insurance for reinsurers--has an impact on the terms of reinsurance and primary insurance. The defendant reinsurers in this case are domestic--e.g., General Reinsurance Corporation (General Re)--and also foreign. The foreign defendant companies include one Swiss corporation, Winterthur Swiss Insurance Company (Winterthur); and six "London Company Market" corporations, all of them subsidiaries

Page 923

of American corporations: Terra Nova Insurance Co., Ltd. (Terra Nova); Unionamerica Insurance Co., Ltd. (Unionamerica); Continental Reinsurance Co., (U.K.) Ltd. (Continental Re); Excess Insurance Group, Ltd. (Excess); Kemper Reinsurance London, Ltd. (Kemper Re); and CNA Re (U.K.) Ltd.

Reinsurance is arranged by specialized brokers and underwriters. Much reinsurance is done by syndicates doing business through Lloyd's of London. A variety of defendants here are underwriters for these reinsurance syndicates-- e.g., Merrett Underwriting Agencies Management, Ltd. (Merrett) and Three Quays Underwriting Management Ltd. (Three Quays). Thomas A. Greene and Co., Inc. (Greene) is an American reinsurance broker, a defendant here. Ballantyne, McKean and Sullivan, Ltd. (Ballantyne) and R.K. Carvill & Co., Ltd., (Carvill) are London reinsurance brokers, defendants here. There are also individual defendants associated with reinsurance--e.g., Peter North Miller, the chairman of the Council of Lloyd's, its governing body; and Robin A.G. Jackson, chief underwriter for Merrett.

Two insurance associations are also defendants. One is Reinsurance Association of America (RAA), which principally engages in lobbying. The other is the Insurance Service Office (ISO). ISO has a key role in the regulation of insurance by the several states. Formed in 1971 by the merger of eleven insurance rating bureaus, ISO is an association of over fourteen hundred property and casualty insurers. It develops standard forms of policies. It collects statistical data and estimates risks relevant to the forms. In those states where regulators formally approve the forms, ISO presents the forms for approval.

In 1984, Hartford expressed its dissatisfaction with the standard ISO form for CGL insurance. In particular, Hartford was displeased with the way the form insured against "occurrences" of liability during the life of the policy. Such insurance had "a long tail," i.e., years after the policy had expired, a claim might be made upon it for an occurrence during the life of the policy. Hartford wanted a "claims made" form to replace the "occurrences" form. Under a "claims made" form only claims made during the life of the policy would be paid....

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35 practice notes
  • Hartford Fire Insurance Co v. California Merrett Underwriting Agency Management Limited v. California, Nos. 91-1111
    • United States
    • United States Supreme Court
    • 28 Junio 1993
    ...brought solely against the London reinsurers. Held: The judgment is affirmed in part and reversed in part, and the case is remanded. 938 F.2d 919 (CA9 1991), affirmed in part, reversed in part, and remanded. Justice SOUTER delivered the opinion of the Court with respect to Parts I, II-A, II......
  • Bank of the West v. Superior Court, No. S019556
    • United States
    • United States State Supreme Court (California)
    • 30 Julio 1992
    ...collects statistical data and estimates risks relevant to the forms. (See generally In re Insurance Antitrust Litigation (9th Cir.1991) 938 F.2d 919.) In 1986 ISO developed a revised CGL policy that replaced the term "unfair competition" with "style of doing business." However, several insu......
  • In re Napster, Inc. Copyright Litigation, No. C MDL-00-1369-MHP.
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California
    • 3 Febrero 2005
    ...suffer antitrust injury." Vinci v. Waste Mgmt., Inc. ("Vinci II"), 80 F.3d 1372, 1376 (9th Cir.1996) (quoting In re Ins. Antitrust Litig., 938 F.2d 919, 926 (9th Cir.1991)) (original alterations and quotation marks omitted), cert. denied, 520 U.S. 1119, 117 S.Ct. 1252, 137 L.Ed.2d 333 (1997......
  • State v. LG Elecs., Inc., No. 91263–7
    • United States
    • United States State Supreme Court of Washington
    • 14 Julio 2016
    ...the interest that the parens 375 P.3d 644 patriae can vindicate by obtaining damages and/or an injunction.” In re Ins. Antitrust Litig. , 938 F.2d 919, 927 (9th Cir. 1991). In considering state claims brought for violations of the Sherman Act, post-Frito–Lay , the Ninth Circuit concluded it......
  • Request a trial to view additional results
35 cases
  • Hartford Fire Insurance Co v. California Merrett Underwriting Agency Management Limited v. California, Nos. 91-1111
    • United States
    • United States Supreme Court
    • 28 Junio 1993
    ...brought solely against the London reinsurers. Held: The judgment is affirmed in part and reversed in part, and the case is remanded. 938 F.2d 919 (CA9 1991), affirmed in part, reversed in part, and remanded. Justice SOUTER delivered the opinion of the Court with respect to Parts I, II-A, II......
  • Bank of the West v. Superior Court, No. S019556
    • United States
    • United States State Supreme Court (California)
    • 30 Julio 1992
    ...collects statistical data and estimates risks relevant to the forms. (See generally In re Insurance Antitrust Litigation (9th Cir.1991) 938 F.2d 919.) In 1986 ISO developed a revised CGL policy that replaced the term "unfair competition" with "style of doing business." However, several insu......
  • In re Napster, Inc. Copyright Litigation, No. C MDL-00-1369-MHP.
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California
    • 3 Febrero 2005
    ...suffer antitrust injury." Vinci v. Waste Mgmt., Inc. ("Vinci II"), 80 F.3d 1372, 1376 (9th Cir.1996) (quoting In re Ins. Antitrust Litig., 938 F.2d 919, 926 (9th Cir.1991)) (original alterations and quotation marks omitted), cert. denied, 520 U.S. 1119, 117 S.Ct. 1252, 137 L.Ed.2d 333 (1997......
  • State v. LG Elecs., Inc., No. 91263–7
    • United States
    • United States State Supreme Court of Washington
    • 14 Julio 2016
    ...the interest that the parens 375 P.3d 644 patriae can vindicate by obtaining damages and/or an injunction.” In re Ins. Antitrust Litig. , 938 F.2d 919, 927 (9th Cir. 1991). In considering state claims brought for violations of the Sherman Act, post-Frito–Lay , the Ninth Circuit concluded it......
  • Request a trial to view additional results

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