Texas Eastern Transmission Corp. PCB Contamination Ins. Coverage Litigation, In re
| Decision Date | 07 April 1993 |
| Docket Number | No. 92-1638,No. 88-02126,No. 88-05039,No. 764,No. 88-05707,764,88-02126,88-05039,88-05707,92-1638 |
| Citation | 15 F.3d 1230 |
| Parties | In re TEXAS EASTERN TRANSMISSION CORP. PCB CONTAMINATION INSURANCE COVERAGE LITIGATION (MDL). ASSOCIATED ELECTRIC & GAS INSURANCE SERVICES, LTD.; National Surety Corporation v. TEXAS EASTERN TRANSMISSION CORPORATION; Fidelity & Casualty Insurance Company of New York; Certain Underwriters at Lloyds of London, Including The Insurance Company of Ireland; Aetna Casualty and Surety Company; American Home Assurance Company; Boston Old Colony Insurance Company; Continental Casualty Insurance Company; First State Insurance Company; Highlands Insurance Company; The Home Insurance Company; Insurance Company of North America; Insurance Company of the State of Pennsylvania; International Insurance Company; Lexington Insurance Company; Midland Insurance Company; Mutual Marine Insurance Company; Prudential Reinsurance Company; Ranger Insurance Company; Republic Insurance Company; Stonewall Insurance Company; Pennsylvania Insurance Guaranty Association; United States of America; United States Environmental Protection Agency (D.C. Civil). The FIDELITY & CASUALTY CO. OF NEW YORK v. The TEXAS EASTERN TRANSMISSION CORP. (D.C. Civil). TEXAS EASTERN TRANSMISSION CORPORATION v. FIDELITY AND CASUALTY COMPANY OF NEW YORK; Associated Electric & Gas Insurance Services, Ltd.; Aetna Casualty and Surety Company; American Home Assurance Company, a/k/a American Home Insurance Company; Boston Old Colony Insurance Company; Cigna Insurance Company; Continental Casualty Company; Employers Mutual Casualty Company; First State Insurance Company; Highlands Insurance Company; The Home Insurance Company; The Insurance Company of North America; Insurance Company of the State of Pennsylvania; International Insurance Company; Lexington Insurance Company; Midland Insurance Company; National Surety Corporation; Prudential Reinsurance Company; Ranger Insurance Company; Republic Insurance Company; Stonewall Insurance Company; United States Fire Insurance Company; Certain Underwriters at Lloyd's, London and Certa |
| Court | U.S. Court of Appeals — Third Circuit |
Peter J. Nickles (argued), Coleman S. Hicks, Covington & Burling, Washington, DC, Charles Alan Wright, Austin, Texas, counsel for appellant Texas Eastern Transmission Corporation.
Leonard L. Rivkin, John L. Rivkin, Erica B. Garay, Rivkin, Radler & Kremer, Uniondale, NY, John C. Sullivan, Manta & Welge, Philadelphia, PA, counsel for appellees Associated Electric & Gas Insurance Services, Ltd. and National Surety Corporation.
John Mattioni, Mattioni, Mattioni & Mattioni, Philadelphia, PA, Margaret H. Warner, Lawrence E. Carr, Jr., Peter K. Tompa, William J. Carter, Carr, Goodson & Lee, Washington, DC, counsel for appellees Fidelity & Casualty Company of New York and Boston Old Colony Insurance Company.
Richard M. Shusterman, Regina B. Mapes, White & Williams, Philadelphia, PA, counsel for appellee Insurance Company of North America.
Edward Zampino, Victor C. Harwood, III, Brian J. Coyle, Harwood Lloyd, Hackensack, NJ, Edward M. Dunham, Jr., Miller, Dunham, Doering & Munson, Philadelphia, PA, counsel for appellee Aetna Casualty & Surety Company.
Marjorie H. Mintzer, Robin S. Einbinder, Sheft & Sheft, New York, NY, Mitchell S. Pinsly, Margolis, Edelstein, Scherlis, Sarowitz & Kraemer, Philadelphia, PA, counsel for appellees American Home Assurance Company; Highland Insurance Group; Insurance Company of the State of Pennsylvania; Lexington Insurance Company; Ranger Insurance Company; Republic Insurance Company; and Stonewall Underwriters, Inc.
Stephen Sonderby, Jody Pucel, Haskell & Perrin, Chicago, IL, counsel for appellee Continental Casualty Company.
Ignatius J. Melito, Barry S. Bendetowies, Siff, Rosen & Parker, P.C., New York, NY, counsel for appellee First State Insurance Company.
David Richman, Colleen Connelly, Pepper, Hamilton & Scheetz, Philadelphia, PA, counsel for appellee Home Insurance Company.
Kevin E. Wolff, McElroy, Deutsch & Mulvaney, Morristown, NJ, Christopher L. Musmanno, Lorraine M. Armenti, McElroy, Deutsch & Mulvaney, Morristown, NJ, Thomas C. DeLorenzo, Marshall, Dennehey, Warner, Coleman & Goggin, Philadelphia, PA, counsel for appellees International Insurance Company and United States Fire Insurance Company.
Michael J. Merlo, Karen L. Douglas, Michael R. Gregg, Merlo, Chapello & Douglas, Ltd., Chicago, IL, counsel for appellee Prudential Reinsurance Company.
Lise Luborsky, Joseph M. Hankins, Britt, Hankins, Schaible & Moughan, Philadelphia Wayne Partenheimer, Law Offices of David L. Rohde, Philadelphia, PA, K. Thomas Shahriari, Mitchell A. Stearn, Gilberg & Kurent, Washington, DC, counsel for appellee National Surety Corporation.
PA, counsel for appellee Pennsylvania Insurance Guaranty Association.
Mary Ann D'Amato (argued), Robert M. Flannery, Mendes & Mount, New York, NY, counsel for appellee Certain London Market Insurance Companies and Insurance Company of Ireland.
Dan Morales, Attorney General, Ms. Esther L. Hajdar, Deputy Appellate Coordinator, Office of the Attorney General of Texas, Austin, TX, counsel for amicus appellant State of Texas.
Thomas W. Brunner, Robert B. Bell, Nancy J. Lemay, Wiley, Rein & Fielding, Washington, DC, counsel for amicus appellee Insurance Environmental Litigation Association.
Before: MANSMANN, ALITO and ALDISERT, Circuit Judges.
This a companion opinion to Fidelity & Casualty Co. of New York v. The Texas Eastern Transmission Corp., 15 F.3d 1249 (3d Cir.1994), an opinion filed today which affirms the district court's determination of liability in three cases consolidated for appeal before us. The three cases are Fidelity & Casualty Co. of New York v. The Texas Eastern Transmission Corp., (hereinafter the "F & C" action) originally filed in the Northern District of Texas, Texas Eastern Transmission Corp. v. Fidelity and Casualty Co. of New York et al., (hereinafter the "Texas Eastern" action) originally filed in a Texas state court and later removed to the Southern District of Texas, and Associated Electric & Gas Insurance Services Ltd. et al. v. Texas Eastern Transmission Corp et al. (hereinafter the "AEGIS" action) filed in the Eastern District of Pennsylvania. All three cases were later assigned by the Multi-District Litigation Panel to the district court below.
This opinion discusses the question of subject matter jurisdiction in the Texas Eastern action and the AEGIS action. We also address the question of jurisdiction in the F & C case to the extent that its jurisdiction based on diversity is impacted by our discussion of subject matter jurisdiction in the other two cases. That our discussion has to be bifurcated in two separate opinions results from a procedural anomaly: Texas Eastern sought rehearing in only two of the three cases--Texas Eastern and AEGIS--and only on the question of subject matter jurisdiction.
At issue in this panel rehearing is the district court's exercise of subject matter jurisdiction in Texas Eastern and AEGIS arising from insurance coverage for the cost of toxic PCB clean-up. The claims were filed after Texas Eastern Transmission Corporation's release, discharge and disposal into the environment of PCB-contaminated substances in the course of operating a natural gas pipeline extending from Texas and Louisiana to New Jersey.
Texas Eastern, the insured, appealed the decision of the district court, which granted summary judgment to Texas Eastern's insurance carriers, primarily on the basis that Texas Eastern breached its duty to provide the carriers timely notice of matters for which it would seek coverage, and in this way prejudiced the carriers. In re Texas Eastern Transmission Corp. PCB Contamination Insurance Coverage Litigation, No. MDL-764, 1992 WL 227847 (E.D.Pa. July 9, 1992). We affirmed in an unreported opinion filed May 28, 1993, 995 F.2d 219, after confirming that the district court had subject matter jurisdiction over all three cases. In the first of the three actions, the "F & C" action, subject matter jurisdiction was based on diversity of citizenship, 28 U.S.C. Sec. 1332, and was not and is not now being contested by Texas Eastern. Subject matter jurisdiction in the remaining two actions, the "AEGIS" action and the "Texas Eastern" action, was derived from the Foreign Sovereign Immunities Act, 28 U.S.C. Sec. 1330 (original) and Sec. 1441(d) (removal).
Thereafter, Texas Eastern filed a petition for rehearing challenging subject matter jurisdiction in the two cases. On August 18 1993, we ordered panel rehearing and stayed the mandate in all three cases consolidated in this appeal. On January 6, 1994, we vacated our unreported opinion.
This opinion addresses the jurisdictional issues raised in the petition for rehearing, which was directed only to the question of subject matter jurisdiction in AEGIS and Texas Eastern. In addition, because Texas Eastern contended on appeal and reasserted on rehearing that the district court lacked jurisdiction over the counterclaim defendants in the F & C case, and hence should have stayed F & C in favor of an allegedly more comprehensive action which Texas Eastern had commenced in a Texas state court, we address this challenge to the district court's jurisdiction in F & C. In a separate opinion filed simultaneously with this, we in effect reinstate the portion of our earlier opinion addressing the substantive merits of the issues on appeal from the order of the district court, as these issues were not challenged in the petition and were not the subject of the rehearing. See Dunn v. HOVIC, 1 F.3d 1362 (1993) (); Dunn v. HOVIC, 1 F.3d 1371 (1993) (...
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