IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CNH INDUSTRIAL AMERICA LLC, )
)
) C.A. No. N12C-07-108 EMD CCLD
Plaintiff, )
)
v. )
)
AMERICAN CASUALTY COMPANY OF )
READING, PENNSYLVANIA, et al., )
)
Defendants. )
Upon Consideration of the Plaintiff’s
Motion for Partial Summary Judgment on Exhaustion
GRANTED in part and DEFERRED in part for further briefing
Brian M. Rostocki, Esquire, and John C. Cordrey, Esquire, Reed Smith LLP, Wilmington,
Delaware and James M. Davis, Esquire, Thomas A. Marrinson, Esquire, Evan T. Knott, Esquire,
Emily E. Garrison, Esquire, Reed Smith LLP, Chicago, Illinois. Attorneys for CNH Industrial
America LLC.
Neal J. Levitsky, Esquire, and Seth A. Niederman, Esquire, Fox Rothschild, LLP, Wilmington,
Delaware and Richard L. McConnell, Esquire, Dale E. Hausman, Esquire, Wiley Rein, LLP,
Washington, DC. Attorneys for Defendant The Travelers Indemnity Company.
John S. Spadaro, Esquire, John Sheehan Spadaro, LLC, Hockessin, Delaware, and Lawrence A.
Nathanson, Esquire, Siegel & Park, Mt. Laurel, New Jersey. Attorneys for Defendants Central
National Insurance Company of Omaha and Century Indemnity Company.
Raymond D. Armstrong, Esquire and Dade D. Werb, Esquire, Giordano, DelCollo & Werb,
LLC, Wilmington, Delaware, and Ralph J. Luongo, Esquire, Carroll, McNulty & Kull LLC,
Philadelphia, Pennsylvania. Attorneys for Defendant Granite State Insurance Company.
DAVIS, J.
INTRODUCTION AND PROCEDURAL HISTORY
This is an action for declaratory relief and breach of contract filed by Plaintiff CNH
Industrial America LLC (“CNH”) against a number of insurance companies, including Travelers
Indemnity Company (“Travelers”). The complaint alleges that the defendant insurance
companies have failed to honor defense and coverage obligations arising from asbestos-related
lawsuits filed against CNH (the “Underlying Lawsuits”).
On October 6, 2014, CNH filed the Plaintiff’s Motion for Partial Summary Judgment on
Exhaustion (the “Motion”). Through the Motion, CNH asks the Court to rule that (1) the
remaining limit of a primary commercial general liability policy that Travelers issued directly to
J.I. Case Company (“J.I. Case”) for the period of January 1, 1972 through January 1, 1973 (the
“J.I. Case Policy”) is $95,920.61; and (2) that 15 primary commercial general liability policies
issued by Travelers covering Tenneco and J.I. Case for the period of January 1, 1972 through
September 1, 1986 (the “Tenneco policies”) are exhausted. Among the Tenneco policies are 13
policies which were exhausted by payments of prior non-asbestos claims to Tenneco.
On May 1, 2015, Travelers filed the Defendant the Travelers Indemnity Company’s
Brief in Response to Plaintiff’s Motion for Partial Summary Judgment on Exhaustion (the
“Response”). Also on May 1, 2015, Defendants Central National Insurance Company of Omaha
and Century Indemnity Company filed Certain Excess Insurers’ Brief in Opposition to Plaintiff’s
Motion for Partial Summary Judgment on Exhaustion (the “Opposition”). On May 3, 2015,
Granite State Insurance Company filed the Joinder of Granite State Insurance Company in
Argument B of the Brief of Certain Excess Insurers in Opposition of Plaintiff’s Motion for
Partial Summary Judgment on Exhaustion (the “Joinder”). On May 13, 2015, CNH filed
Plaintiff CNH Industrial America LLC’s Reply Brief in Support of its Motion for Partial
Summary Judgment on Exhaustion (the “Reply”).
On May 18, 2015, the Court held a hearing (the “May 18 Hearing”) on a series of
outstanding motions filed by the parties in this civil action, including the Motion, the Response,
the Opposition, the Joinder and the Reply. After hearing arguments the Court took the Motion
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under advisement. The Court did make certain rulings at the May 18 Hearing on other motions
that impacted the relief sought in the Motion. The Court held that Wisconsin law applied with
respect to the J.I. Case Policy and the Tenneco policies. In addition, the Court held that the
relevant policies had been effectively assigned to CNH as part of the 1994 reorganization.
On July 6, 2015, Travelers filed a letter (the “July 6 Letter”) with the Court. In the July 6
Letter, Travelers contends that certain payments recently made by Travelers to CNH for losses
and defense costs “allegedly” incurred by CNH with respect to the Underlying Lawsuits means
that certain issues under the Motion, and the other pending motions, may require additional
briefing. CNH responded to the July 6 Letter on July 9, 2015 (the “July 9 Letter”). Not
surprisingly, CNH disagrees with Travelers’ position as set out in the July 6 Letter. In the July 9
Letter, CNH contends that the payments do not “impact or influence the arguments made in the
pending motions….” Despite taking this position in the July 9 Letter, CNH subsequently filed
its Plaintiff’s Motion Seeking an Expedited Declaration of CNH’s Right to Cash Checks Sent by
Travelers and Rejecting Travelers’ Attempts to Prejudice CNH by Mischaracterizing those
Checks (the “Checks Motion”) on August 6, 2015. In response to the Checks Motion, the Court
set an expedited briefing schedule that should be completed by September 22, 2015.
As set forth below, the Court does believe certain issues pending in the Motion should be
deferred pending briefing on the Checks Motion and explanation by Travelers why its payments
impact the Motion. However, the Court also believes that certain aspects of the Motion are ripe
and should be decided as set forth in this Opinion.
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LEGAL STANDARD AND DISCUSSION
The standard of review on a motion for summary judgment is well-settled. The Court’s
principal function when considering a motion for summary judgment is to examine the record to
determine whether genuine issues of material fact exist, “but not to decide such issues.” 1
Summary judgment will be granted if, after viewing the record in a light most favorable to a non-
moving party, no genuine issues of material fact exist and the moving party is entitled to
judgment as a matter of law. 2 If, however, the record reveals that material facts are in dispute, or
if the factual record has not been developed thoroughly enough to allow the Court to apply the
law to the factual record, then summary judgment will not be granted. 3 The moving party bears
the initial burden of demonstrating that the undisputed facts support his claims or defenses. 4 If
the motion is properly supported, then the burden shifts to the non-moving party to demonstrate
that there are material issues of fact for resolution by the ultimate fact-finder. 5
In the Motion, CNH seeks a determination that the J.I. Case Policy and the 1978 and
1985-86 Tenneco Policies are “partially exhausted” and that all other Tenneco Policies are fully
exhausted. Travelers replied and agreed that all of its primary policies issued to Tenneco and J.I.
Case have been exhausted, with the exception of the J.I. Case Policy, the 1/1/78-9/1/78 Tenneco
Policy, and the 9/1/85-9/1/86 Tenneco Policy. While other defendants contest this “agreement”
between the primarily responsible parties, the Court does not find that there is a genuine issue of
1
Merrill v. Crothall-American Inc., 606 A.2d 96, 99-100 (Del. 1992) (internal citations omitted); Oliver B. Cannon
& Sons, Inc. v. Dorr-Oliver, Inc., 312 A.2d 322, 325 (Del. Super. 1973).
2
Merrill, 606 A.2d at 99-100; Dorr-Oliver, 312 A.2d at 325.
3
Ebersole v. Lowengrub, 180 A.2d 467, 470 (Del. 1962); see also Cook v. City of Harrington, 1990 WL 35244, at
*3 (Del. Super. Feb. 22, 1990) (citing Ebersole, 180 A.2d at 467) (“Summary judgment will not be granted under
any circumstances when the record indicates ... that it is desirable to inquire more thoroughly into the facts in order
to clarify the application of law to the circumstances.”).
4
Moore v. Sizemore, 405 A.2d 679, 680 (Del. 1979) (citing Ebersole, 180 A.2d at 470).
5
See Brzoska v. Olson, 668 A.2d 1355, 1364 (Del. 1995).
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material fact on this particular issue. Therefore, the Court holds that this is no longer a contested
issue of fact for purposes of the Motion or this civil proceeding.
The July 6 letter provided the Court with new and material information about the issue of
exhaustion of the J.I. Case Policy, the 1/1/78-9/1/78 Tenneco Policy, and the 9/1/85-9/1/86
Tenneco Policy. The impact of the July 6 Letter, the July 9 Letter and the Check Motion on the
arguments made in the Motion must be considered. Moreover, the Answer relies in part on the
incorrect contention that Wisconsin law does not apply to the issue. As the Court held at the
May 18 Hearing, Wisconsin law applies with respect to the J.I. Case Policy and the Tenneco
policies. As such, the parties shall provide additional briefing to the Court on the issue of
exhaustion, taking into considerations the Court’s rulings and the July 6 letter.
CONCLUSION
For the foregoing reasons the Motion is GRANTED on the point of exhaustion of all
Tenneco Policies except that the J.I. Case, the 1/1/78-9/1/78 Tenneco Policy, and the 9/1/85-
9/1/86 Tenneco Policy are only partially exhausted (subject to new facts raised in the July 6
Letter) and the remaining issues in the Motion are DEFERRED. The Court will contact the
parties to set up a status conference on briefing and additional oral arguments.
Dated: August 21, 2015
Wilmington, Delaware
/s/ Eric M. Davis
Eric M. Davis, Judge
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