Neville Chem. Co. v. TIG Ins. Co.
| Decision Date | 17 March 2021 |
| Docket Number | 2:17-CV-00334-CRE |
| Citation | 570 F.Supp.3d 309 |
| Parties | NEVILLE CHEMICAL COMPANY, Plaintiff, v. TIG INSURANCE COMPANY, Defendant |
| Court | U.S. District Court — Western District of Pennsylvania |
J. David Ziegler, Dickie, McCamey & Chilcote, P.C., Pittsburgh, PA, for Plaintiff.
Alexander Wilson Saksen, Goldberg Kamin & Garvin, Pittsburgh, PA, Christopher J. Haselhoff, Summerly E. Kulik, Gordon Rees Scully Mansukhani, Pittsburgh, PA, for Defendant.
Plaintiff Neville Chemical Company ("Neville") initiated this insurance contract declaratory judgment action pursuant to 28 U.S.C. § 2201 on March 15, 2017 generally alleging it is entitled to be indemnified in connection with an Excess Workers Compensation Insurance Policy (the "Policy") issued by TIG Insurance Company ("TIG"). This Court has subject matter jurisdiction over this matter pursuant to 28 U.S.C. § 1331.
Presently pending before the Court are the following:
For the reasons that follow, Neville's motion for summary judgment is denied and TIG's motion for summary judgment is granted.
This declaratory judgment action was commenced by Neville against TIG in relation to TIG's Excess Worker's Compensation Insurance Policy in which Neville seeks indemnification for worker's compensation benefits in excess of the Policy's retention amount paid to a former Neville employee.
The facts surrounding Neville's former employee's work-related injuries and medical treatment are not in dispute. In June 1993, Larry Kelley was employer by Neville as a pump mechanic and sustained a work-related injury to his lower back while installing a hot oil pump. Mr. Kelley was diagnosed with a L5-S1 disc herniation and underwent a laminectomy
with a bilateral microdiscectomy at the L5 and L5-S1 level on February 16, 1994. A follow-up of Mr. Kelley's lumbar spine completed in September 1995 did not show evidence of spinal stenosis or herniations at any level. During this time, Mr. Kelley submitted a worker's compensation claim to Neville. Neville filed an Employer's Report of Injury, and accepted liability for Mr. Kelley's work-related injury through issuance of a Notice of Compensation Payable. Mr. Kelley returned to work following his surgery on January 11, 1995, missed a day in March 1995 and then was again out of work from August 31, 1995 to December 7, 1995.
Mr. Kelley was able to return to work from December 1995 through January 8, 2001. During this time, Neville claims that Mr. Kelley never worked in a full capacity and always had help from other Neville employees to do his job, but it is undisputed that from April 1996 through January 2001, no indemnity or wage loss payments were made by Neville for Mr. Kelley's 1993 injury. Neville maintains that while Mr. Kelley did not submit any medical expense claims through worker's compensation, he did seek medical treatment periodically with Neville's company physician.
On December 28, 2000, Mr. Kelley had a work-related incident relating to his lower back that he reported on February 7, 2001. Mr. Kelley was off work from January 8, 2001 through January 31, 2001. As a result of this alleged work-related injury, Mr. Kelley submitted a new worker's compensation claim. On February 13, 2001, Neville's company physician was asked if the alleged new injury was a new injury or was related to his old back injury. The physician believed Mr. Kelley's symptoms related to his old June 1993 injury. On February 20, 2001, Neville denied Mr. Kelley's new worker's compensation claim stating that Mr. Kelley did not suffer a work-related injury, but rather suffered a possible aggravation of a pre-existing condition related to the June 1993 incident. As a result of this determination, Neville paid Mr. Kelley worker's compensation benefits based on a recurrence of his previous June 1993 work-related injury. Mr. Kelley did not appeal or dispute Neville's decision to pay him benefits based on a recurrence of his June 1993 injury.
At some point in July 2003, Mr. Kelley started experiencing lower back pain. While he could not recall any particular event giving rise to this pain, he believed the pain to related to playing around with a motor. As a result, Mr. Kelley saw a physician to determine if his lower back pain was a recurrence of his 1993 work-related injury or if it was a new injury. The physician noted that Mr. Kelley had a recurrence of his back pain and his right leg pain. Mr. Kelley did not submit a new claim for worker's compensation and was paid medical and indemnity payments under his previous June 1993 claim. Mr. Kelley attempted to return to work in January 2005 but left full time work in late-January 2005 and has not worked since that time.
Following Mr. Kelley's departure, Neville and third-party administrators continued to handle Mr. Kelley's worker's compensation claim arising from his June 24, 1993 work-related injury. Mr. Kelley underwent several independent medical examinations to determine the status of his medical condition, its cause and whether he could return to work. One physician, Daniel A. Wecht, M.D. M.S.c. FACS, opined that Mr. Kelley's continued symptoms relate largely to his original June 1993 work injury and progressive degenerative change. Dr. Wecht does not believe that Mr. Kelley is ever likely to return to his original work activities as a millwright.
At the time of Mr. Kelley's June 1993 work-related injury, Neville had a self-insured worker's compensation program that covered worker's compensation claims up to a self-insured retention limit of $500,000 per occurrence. In addition to this program, Neville held a Specific Excess Workers Compensation and Employers Liability Policy issued by TIG with a policy period from January 1, 1993 to January 1, 1994. The Policy provided that TIG would indemnify Neville for losses resulting from an occurrence related to a worker's compensation claim if it were covered under Neville's qualified self-insured retention plan and exceeded Neville's self-insured retention limit ("SIR").
As to the policy's coverage, the Policy states in pertinent part:
The Policy also contains a retention and limit of indemnity provision which states:
(ECF No. 55-20) (emphasis added).
The Policy defines "occurrence" as "Occupational disease" is defined as including "cumulative injuries." Id.
On April 7, 2015, Neville contacted TIG seeking reimbursement under the TIG Excess Policy in relation to Mr. Kelley's worker's compensation. Neville requested reimbursement for indemnity, medical and expenses and indicated the total amount of payments at that time amounted to $505,129.90. Under the Policy, Neville sought reimbursement for $5,129.90 which exceeded the SIR at that time. As of June 2020, Neville claims it has paid $241,320.67 above its SIR and that amount will continue to increase by $868.96 every two weeks for indemnity payments made to Mr. Kelley and will increase for any paid medical expenses and other allowable expenses under the Policy. TIG did not honor Neville's request for reimbursement and Neville initiated this declaratory judgment action seeking a declaration that TIG has a duty to indemnify it for all payments made in connection to Mr. Kelley's worker's compensation benefits exceeding the SIR.
The standard for assessing a motion for summary judgment under Rule 56 of the Federal Rules of Civil Procedure is well-settled. A court should grant summary judgment if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Furthermore, "summary judgment will not lie if the dispute about a material fact is ‘genuine,’ that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. at 250, 106 S.Ct. 2505.
On a motion for summary judgment, the facts and the inferences to be drawn therefrom should be viewed in the light most favorable to the non-moving party. See Reeves v....
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