Cases & Deals

Cardinal Health persuades Sixth Circuit to uphold Ohio District Court's remand order in insurance coverage action

Clients Cardinal Health, Inc.

Jones Day prevailed in a Sixth Circuit appeal on behalf of Cardinal Health, Inc. In a published decision, the Sixth Circuit affirmed the district court's decision to decline jurisdiction over a declaratory judgment action involving state insurance coverage issues. Cardinal Health sued National Union Fire Insurance Company of Pittsburgh, PA in Ohio state court, seeking declarations that National Union is obligated to defend it in underlying opioid lawsuits. National Union removed the action to federal court on the basis of diversity jurisdiction. Because the case was brought pursuant to the Declaratory Judgment Act, the district court had discretion over whether to exercise jurisdiction or remand the case to state court. Cardinal Health argued that the case ought to be remanded because it involved only issues of state insurance law. The district court agreed, explaining that "the most efficient, useful, and fair result would be to decline jurisdiction and allow the case to proceed in state court." On appeal, the Sixth Circuit affirmed, explaining: "Ohio law is simply not clear on the issue of whether insurers have a duty to defend opioid distributors and thus there is a risk that a federal court's decision will conflict with Ohio state courts currently considering the issues." The decision is an important win for policyholders, as it confirms that state courts should be allowed to define and enforce their own insurance laws.

Cardinal Health, Inc. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 2:20-cv-05854 (S.D. Ohio); No. 21-3770 (6th Cir.)