Cases & Deals

Eaton wins summary judgment on duty to defend

Client(s) Eaton Corporation

Jones Day represents Eaton Corporation affiliate Cooper Industries, LLC in a claim for insurance coverage for CERCLA liabilities of a predecessor entity arising from the Lower Passaic River Study Area in Essex County, New Jersey. The insurers denied their duty to defend and indemnify Cooper. Jones Day moved for summary judgment on behalf of Cooper against a primary insurer on the issue of the duty to defend. On August 30, 2016, the trial court granted summary judgment in Cooper's favor. Importantly, the trial court's decision resolved two important issues of first impression in favor of Cooper. First, the trial court ruled that a potentially responsible party letter from the EPA constituted a "suit" that triggered coverage under a general liability policy. Second, the trial court rejected the insurer's argument that pursuant to the New Jersey Supreme Court's decision in Burd v. Sussex Mutual, 56 N.J. 383 (1970), there was no duty to defend until all coverage issues are decided in Cooper's favor. In an important victory for Cooper and policyholders in New Jersey, the trial court held that Burd had been "implicitly limited" by subsequent decisions and that the insurers had a present duty to defend provided the underlying claims were potentially covered.

Cooper Industries, LLC v. Employers Ins. Of Wausau, No. L-9284-11 (N.J. Super. Ct. Law Div.)