IN RE: CVS OPIOID INSURANCE LITIGATION

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

IN RE: CVS OPIOID ) Consol. C.A. No. N22C-02-045
INSURANCE LITIGATION ) PRW CCLD

Submitted: July 24, 2023
Decided: August 25, 2023
Written Decision Withdrawn, Corrected, and Reissued: September 14, 2023

OPINION AND ORDER

Upon Insurers’ and Joining Insurers’ Motions for Partial Summary Judgment
GRANTED

Garrett B. Moritz, Esquire, and R. Garret Rice, Esquire, ROSS ARONSTAM & MORITZ
LLP, Wilmington, Delaware; Michael S. Shuster, Esquire, Daniel M. Sullivan,
Esquire, Blair E. Kaminsky, Esquire, and Daniel M. Horowitz, Esquire, HOLWELL
SHUSTER & GOLDBERG LLP, New York, New York, Attorneys for ACE Property
and Casualty Insurance Company, Federal Insurance Company, Indemnity
Insurance Company of North America, Vigilant Insurance Company, and
Westchester Fire Insurance Company.

Robert J. Katzenstein, Esquire, and Julie M. O’Dell, Esquire, SMITH KATZENSTEIN
& JENKINS LLP, Wilmington Delaware; Christopher J. St. Jeanos, Esquire, WILLKIE
FARR & GALLAGHER LLP, New York, New York, Attorneys for American Home
Assurance Company, Lexington Insurance Company, National Union Fire
Insurance Company of Pittsburgh, P.A., and New Hampshire Insurance Company.

Bruce W. McCullough, Esquire, BODELL BOVÉ, LLC, Wilmington, Delaware; Karen
M. Dixon, Esquire, SKARZYNSKI MARICK & BLACK LLP, Chicago, Illinois,
Attorneys for American Zurich Insurance Company, Zurich American Insurance
Company, and American Guarantee & Liability Insurance Company.

Joseph B. Cicero, Esquire, CHIPMAN BROWN CICERO & COLE, LLP, Wilmington,
Delaware; Adam H. Fleischer, Esquire, R. Patrick Bedell, Esquire, and Allyson C.
Spacht, Esquire, BATESCAREY LLP, Chicago, Illinois, Attorneys for Great American
Alliance Insurance Company, Great American Insurance Company of New York,
Great American Insurance Company, and Tamarack American, Inc.
Louis J. Rizzo, Jr., Esquire, REGER RIZZO & DARNALL LLP, Wilmington, Delaware;
Monica T. Sullivan, Esquire, Matthew J. Fink, Esquire, Leena Soni, Esquire, and
Stephanie M. Flowers, Esquire, NICOLAIDES FINK THORPE MICHAELIDES SULLIVAN
LLP, Chicago, Illinois, Attorneys for Endurance American Insurance Company, and
North American Capacity Insurance Company.

Sean J. Bellew, Esquire, BELLEW LLC, Wilmington, Delaware; Michael A. Kotula,
Esquire, RIVKIN RADLER LLP, Attorneys for Allianz Insurance Company, Fireman’s
Fund Insurance Company, Interstate Indemnity Company, and National Surety
Company.

Loren R. Barron, Esquire, WEBER GALLAGHER, Wilmington, Delaware, Attorney for
Gemini Insurance Company, and Berkley National Insurance Company.

Wade A. Adams, III, Esquire, LAW OFFICES OF WADE A. ADAMS, III, Newark,
Delaware; Bryce L. Friedman, Esquire, and Matthew C. Penny, Esquire, SIMPSON
THACHER & BARTLETT LLP, New York, New York, Attorneys for Discover Property
and Casualty Company, St. Paul Fire and Marine Insurance Company, Gulf
Underwriters Insurance Company, United States Fidelity and Guaranty Company,
and The Travelers Indemnity Company.

Thad J. Bracegirdle, Esquire, Sarah T. Andrade, Esquire, and Emily L. Skaug,
Esquire BAYARD, P.A., Wilmington, Delaware; Edward B. Parks, II, Esquire, and
Sara Hunkler, Esquire, RUGGERI PARKS WEINBERG LLP, Washington, D.C.,
Attorneys for First State Insurance Company, and Twin City Fire Insurance
Company.

Peter B. Ladig, Esquire, Elizabeth A. Powers, Esquire, BAYARD, P.A., Wilmington,
Delaware; Kevin T. Coughlin, Esquire, Suzanne C. Midlige, Esquire, and Patrick K.
Coughlin, Esquire, Tanya M. Mascarich, Esquire, Zachary M. Sherman, Esquire,
COUGHLIN MIDLIGE & GARLAND LLP, Morristown, New Jersey, Attorneys for
Arrowood Indemnity Company.

Kevin. J. Connors, Esquire, MARSHALL DENNEHEY WARNER COLMAN & GOGGIN
P.C., Wilmington, Delaware; Cheryl P. Vollweiler, Esquire, SKARZYNSKI MARICK &
BLACK LLP, New York, New York, Attorneys for AXIS Insurance Company.

Philip Trainer, Jr., Esquire, and Marie M. Degnan, Esquire, ASHBY & GEDDES,
Wilmington, Delaware; Robert A. Kole, Esquire, and Caroline M. Trusty, Esquire,
CHOATE, HALL & STEWART LLP, Boston, Massachusetts, Attorneys for Liberty
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Insurance Underwriters, Inc., Liberty International Underwriters, and The Ohio
Casualty Insurance Company.

Marc S. Casarino, Esquire, KENNEDYS CMK LLP, Wilmington, Delaware;
Christopher R. Carroll, Esquire, Jillian D. Dennehy, Esquire, and Joshua S.
Wirtshafter, Esquire, KENNEDYS CMK LLP, Basking Ridge, New Jersey, Attorneys
for TIG Insurance Company.

Kathleen M. Miller, Esquire, and Robert K. Beste, Esquire, SMITH KATZENSTEIN &
JENKINS LLP, Wilmington Delaware; Keith Moskowitz, Esquire, DENTONS US LLP,
Chicago, Illinois; Kathryn Guinn, Esquire, DENTONS US LLP, Denver, Colorado;
Deborah J. Campbell, Esquire, DENTONS US LLP, St. Louis, Missouri, Attorneys for
XL Insurance America, Inc., Greenwich Insurance Company, and The Continental
Insurance Company.

David J. Baldwin, Esquire, Peter C. McGivney, Esquire, and Zachary J. Schnapp,
Esquire, BERGER HARRIS LLP, Wilmington, Delaware; Kirk Pasich, Esquire, PASICH
LLP, Los Angeles, California; Jeffrey L. Schulman, Esquire, and Peter A. Halprin,
Esquire, Tae E. Andrews, Esquire, PASICH LLP, New York, New York, Attorneys
for CVS Health Corporation.

WALLACE, J.

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 I. INTRODUCTION

The opioid crisis in the United States has produced countless lawsuits brought

by governmental entities against suppliers, manufacturers, and distributors of those

drugs (the “Opioid Lawsuits”). To recoup the costs of defending against and settling

these lawsuits, those defendants have sought coverage from various insurance

companies. Early last year, the Delaware Supreme Court in ACE American

Insurance Co. v. Rite Aid Corp. (“Rite Aid”) issued a key ruling in the insurance

landscape for opioid litigation by finding that claims seeking generalized economic

damages to redress the opioid crisis are not claims seeking “damages because of

bodily injury.”1 This Court applies that decision today to retail pharmacy giant CVS

Health Corporation (“CVS”).

With respect to Plaintiffs Chubb and AIG (the “Insurers”), at issue are nine

Opioid Lawsuits where CVS Health has been named as a defendant. Two of the

lawsuits (Summit and Cuyahoga) are “Track One Suits” that are part of the

consolidated multi-district litigation styled In Re: National Prescription Opioid

Litigation, 17-md-2804 (N.D. Ohio) (the “MDL”).2 Seven of them (Florida,

Philadelphia, Cherokee, Lake, Trumbull, Suffolk, and Nassau) are the Insurers’

1
270 A.3d 239 (Del. 2022).
2
Chubb and AIG’s Motion for Partial Summary Judgment (the “Insurers’ Motion”) at 6 (D.I.
279).
Additional Representative Suits (the “Additional Representative Suits”).3 This

Court has carefully reviewed each underlying complaint in those suits.

Present before the Court is Insurers’ motion for partial summary judgment,

seeking a declaration that they owe no duty to defend CVS for the Track One Suits

and the Additional Representative Suits (the “Insurers’ Motion”). 4 Additionally,

Defendant Insurers named in CVS’s Third-Party complaint (the “Joining Insurers”)

have joined in the Insurers’ Motion (the “Joinder Motion”).5 They seek a declaration

that they have no duty to defend or indemnify CVS for the Track One Suits and the

Additional Representative Suits. 6

For the reasons explained below, the Insurers’ Motion is GRANTED, and

Joining Insurers’ Motion is also GRANTED.

II. FACTUAL AND PROCEDURAL BACKGROUND

A. THE PARTIES

There are a significant number of parties to this consolidated action. The

relevant parties are referred to generally as the Insurers, the Joining Insurers, and

3
Insurers’ Motion at 4.
4
Id. at 4-5.
5
Joining Insurers’ Motion for Partial Summary Judgment and Joinder in the Insurers’ Motion
for Partial Summary Judgment (the “Joinder Motion”) at 3-4 (D.I. 286). The Joinder Motion in
essence adopts in whole the Insurers’ Motion. Therefore, this Memorandum Opinion will typically
discuss the Insurers’ Motion, which encompasses both the Insurers’ and Joining Insurers’
arguments.
6
Id. at 3-4.

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CVS. The parties from the original complaint include Insurers Chubb 7 and AIG, 8

as well as CVS. CVS is a Delaware corporation with its principal place of business

in Woonsocket, Rhode Island.9 CVS also filed a Third-Party Complaint against a

number of insurers, 10 included among them are the Joining Insurers. 11

B. THE OPIOID LAWSUITS

It is well-known that the United States has grappled with the opioid addiction

crisis for many years. The Centers for Disease Control and Prevention has described

it as a “national epidemic,” 12 and states, counties, municipalities, and Native

American tribes have filed thousands of Opioid Lawsuits against opioid

manufacturers, distributors, and retailers. 13 Many of the Opioid Lawsuits are

consolidated in the MDL; others are pending in state courts around the country.14

On November 2, 2022, CVS announced it had reached an agreement in principle to

“substantially resolve all opioid lawsuits” brought “by states, political subdivisions,

7
The Chubb Plaintiffs are ACE Property and Casualty Insurance Company, Federal Insurance
Company, Indemnity Insurance Company of North America, Vigilant Insurance Company, and
Westchester Fire Insurance Company. See Insurers’ Motion at 1 n.1.
8
The AIG Plaintiffs are National Union Fire and Insurance Company of Pittsburgh, Pa.,
American Home Insurance Company, and New Hampshire Insurance Company. See id. n.2.
9
Complaint (“Compl.”) ¶ 15 (D.I. 1).
10
See generally Third-Party Complaint (“CVS Compl.”) (D.I. 220).
11
The Joining Insurers are listed in the Joinder Motion. See Joinder Motion at 1 n.1.
12
Insurers’ Motion, Ex. 1.
13
Insurers’ Motion at 6.
14
Id.

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such as counties and cities, and tribes in the United States.” 15

1. The Track One Suits

The MDL court designated two Opioid Lawsuits—the Track One Suits—as

bellwether cases for purposes of discovery and trial.16 Those plaintiffs, which

include the Ohio Counties of Summit and Cuyahoga, seek to recover from retail

pharmacies (among other defendants) losses allegedly incurred in responding to the

opioid crisis.17 Both the Cuyahoga and Summit complaints make clear that the

plaintiffs, in their assertion of common law nuisance claims, “do not seek damages

for death, physical injury to person, emotional distress, or physical damages to

property, as defined under the Ohio Product Liability Act.” 18 The complaints instead

allege those plaintiffs suffered “unique harms” that “are of a different kind and

degree than Ohio citizens at large…[and that] [t]hese…harms…can only be suffered

by [Cuyahoga and Summit counties].” 19 Additionally, the complaints “assert[] their

own rights and interests and [their] claims are not based upon or derivative of the

15
CVS Health reaches agreement in principle for global opioid settlement, CVS HEALTH (Nov.
2, 2022), www.cvshealth.com/news/community/cvs-health-reaches-agreement-in-principle-for-
global-opioid.html)); Insurers’ Motion at 7.
16
Insurers’ Motion at 8.
17
Id.; see also CVS’s Opposition Brief to the Insurers’ Motion (“CVS Opp’n to Insurers’
Motion”) at 11 (D.I. 327).
18
Insurers’ Motion, Ex. 2 (“Summit Compl.”) ¶ 1038; Ex. 3 (“Cuyahoga Compl.”) ¶ 1080.
19
Id. ¶ 1074; Summit Compl. ¶ 1032.

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rights of others.” 20

a. The Summit suit

The Summit complaint contains allegations that “national retail pharmacy

chains earned enormous profits by flooding the country with prescription

opioids…and instead of taking any meaningful action to stem the flow of opioids

into communities, they continued to participate in the oversupply and profit from

it.”21 Moreover, according to the Summit plaintiffs, defendants “disregarded their

reporting and due diligence obligations,” 22 and cite to increased government

expenditures for emergency, medical and social services in response to increased

rates of opioid addiction, overdose deaths, and other opioid-related fatalities.23 To

illustrate, those plaintiffs allege that:

• 1,053 residents died from drug overdoses between mid-August 2017
and 2022; 24

• overdoses spiked to 19 a day in July 2016; 25

• from 2012 to 2017, the County’s Children Services Board incurred
nearly $24 million in costs; 26 and

20
Id. ¶ 1033; Cuhayoga Compl. ¶ 1075.
21
Id. ¶ 608.
22
Id. ¶ 714.
23
Id. ¶¶ 715-746.
24
Id. ¶ 722.
25
Id. ¶ 731.
26
Id. ¶ 735.

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 • the Alcohol, Drug, Addiction, and Mental Health Services Board
incurred more than $10 million in costs. 27

The Summit plaintiffs assert a variety of tort and statutory-based claims, including

statutory and common law nuisance and negligence claims.28

b. The Cuyahoga suit

The Cuyahoga complaint contains substantively identical allegations and

claims.29 It identifies increased levels of overdose deaths, and other opioid-related

fatalities as well as increased county expenditures in the form of emergency, medical

and social services, addiction-related treatment, and incarceration costs.30 It further

identifies specific providers, and gives data on the number of opioids distributed in

the county from 2006 and 2014.31 In terms of costs to the county, it alleges that

Cuyahoga has spent “approximately $1.45 billion” in its annual budget to address

the opioid crisis, 32 and provides illustrative examples including:

• treatment in 2016 of 1,440 individuals for opioid-use disorder or
dependence;33

27
Id.
28
See id. ¶¶ 975-1072, 1091-1138.
29
See Cuyahoga Compl.
30
Id. ¶¶ 700-710, 752-773.
31
Id. ¶¶ 715-728.
32
Id. ¶ 729.
33
Id. ¶ 730.

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 • increased budget expenditures of $39.4 million by Cuyahoga’s
Alcohol, Drug Addiction and Mental Health Services;34

• increased costs of providing treatment beds from $4.9 million in
2014 to $9.9 million in 2017; 35

• administration by Cuyahoga County EMS of 1,903 doses of
naloxone in 2015, 5,100 doses in 2016, and 6,643 doses in 2017; 36

• treatment and recovery services for 82 patients “at a cost of
$10,190 per patient (a cost of more than $835,000); 37

• participation of 105 patients in addiction counseling at a rate of
$87.28 an hour;” 38

• an estimated “$185,000 a year for medication assisted treatments for
jail inmates;” 39

• “$100,000 in vivitrol shots” in 2017;40 and

• a “$3.5 million contract in 2017 for the county’s more than
2,300 inmates.”41

And the Cuyahoga complaint sets out liability claims similar to those in the Summit

complaint.42

34
Id. ¶ 731.
35
Id. ¶ 734.
36
Id. ¶ 739.
37
Id. ¶ 750.
38
Id.
39
Id. ¶ 765.
40
Id. ¶ 770.
41
Id. ¶ 764.
42
See id. ¶¶ 1017-1115, 1134-1179.

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 2. The Additional Representative Suits

There are seven Additional Representative Suits. Two are brought by

counties in Ohio—Lake and Trumbull Counties (“Track Three Suits.”). 43 Two are

brought by counties in New York—Nassau and Suffolk Counties. 44 And the three

other lawsuits are brought by the Cherokee Nation, the City of Philadelphia, and the

State of Florida.45 Like the Track One Suits, each Additional Representative Suit is

brought by a governmental entity and seeks to recover from CVS (and other

defendants) losses allegedly incurred in responding to the opioid crisis. 46 Some of

the Additional Representative Suits have been settled by CVS; 47 others went to

trial.48

a. The Track Three Suits

The Track Three Suits largely mirror the allegations in the Track One Suits.

Plaintiffs in the Track Three Suits raise common law nuisance claims against

distributors and pharmacies and seek “abatement of the nuisance” they allege

defendants created. 49 These suits take:

43
CVS Opp’n to Insurers’ Motion at 10.
44
Id.
45
Id. at 8-9.
46
Insurers’ Motion at 9.
47
Id.
48
Id. at 10.
49
Insurers’ Motion, Ex. 4 (“Lake Compl.”) ¶ 607; Ex. 12 (“Trumbull Compl.”) ¶ 607.

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 “aim at a primary cause of the opioid crisis: a supply chain scheme,
pursuant to which distributors and pharmacies failed to design and
operate systems to identify suspicious orders of prescription opioids,
maintain effective controls against diversion, and halt suspicious orders
when they were identified, and instead actively contributed to the
oversupply of such drugs and fueled an illegal secondary market.” 50

The Track Three plaintiffs allege defendants’ conduct has resulted in a variety

of costs, including “handling of emergency services to overdoses, providing

addiction treatment, handling of opioid related investigations, arrests, adjudications,

and incarceration, treating opioid-addicted newborns in neonatal intensive care

units, burying the dead, and placing thousands of children in foster care

placements.”51 The complaints allege county-specific facts such as the number of

opioid deaths, increase in opioid cases, data on the number of opioids prescribed in

the county, and identification of “problematic” prescribers. 52 For example, in Lake

County, 240 deaths due to heroin or fentanyl overdoses occurred from 2013 to 2017,

and opioid cases increased from 296 to 863 during that time period. 53

b. The New York suits

The New York suits provide the least-particularized county-specific

information in comparison to the Track One and rest of the Track Three Suits, but

50
Id. ¶ 9; Lake Compl. ¶ 9.
51
Id. ¶ 15; Trumbull Compl. ¶ 15.
52
Id. ¶ 569; Lake Compl. ¶ 569.
53
Id. ¶¶ 571, 582.

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nonetheless allege the same general pattern of misconduct. The New York plaintiffs

allege distributors at the retail level “flooded [the] county with opioids, failed to

detect suspicious orders, and failed to prevent diversion of these dangerous

products.”54 These plaintiffs say that the retail pharmacies “earned enormous profits

by flooding the country with prescription opioids,” 55 and caused “a public health

and law-enforcement crisis.”56 And the New York plaintiffs assert a variety of tort

and statutory claims, including nuisance and negligence claims.57

c. The Cherokee suit

The Cherokee complaint is brought by the Cherokee Nation against retail

pharmacies and includes allegations that defendants’ distribution and dispensing of

prescription opioids on and around the Cherokee nation have significantly harmed

its citizens.58 The Cherokee plaintiff alleges damages ranging from increased costs

of medical care, law enforcement measures, rehabilitation services, welfare and

property damage and public blight. 59 Plaintiff states “costs were incurred . . . to

address public harm caused by a persistent course of deceptive and unlawful conduct

54
Insurers’ Motion, Ex. 14 (“Suffolk Compl.”) ¶ 7; Ex. 15 (“Nassau Compl.”) ¶7.
55
Id. ¶ 148; Suffolk Compl. ¶ 148.
56
Id. ¶ 150; Nassau Compl. ¶ 150.
57
Insurers’ Motion, Ex. 13 (“New York Short Form Compl.”) ¶¶ 784-846; Suffolk Compl. ¶ 234;
Nassau Compl. ¶ 234.
58
Insurers’ Motion, Ex. 5 (“Cherokee Compl.”) ¶ 13.
59
Id. ¶ 14.

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by defendants.”60 And the Cherokee plaintiff alleges that:

• CVS shipped 8,456,500 dosage units of prescription opioids from
2006 to 2014;61

• between 2012 and 2014, 484 deaths occurred from unintentional
overdoses in Cherokee Nation;62 and

• there were 5,700 opioid related visits to Cherokee Nation’s Behavior
Health Department “in recent years.”63

This plaintiff brings claims of nuisance, negligence/gross negligence, unjust

enrichment and conspiracy. 64 The damages sought are for “harm to Cherokee Nation

as a tribal sovereign, including recovery of the funds Cherokee Nation had to spend

on opioid-related care.” 65 But, as explained in the Cherokee complaint, the claims

asserted do not “belong to individual Cherokee citizens,” nor does the Cherokee

plaintiff seek “to recover on behalf of individual citizens based on those individuals’

personal injuries or wrongful deaths.”66

d. The Philadelphia suit

In the Philadelphia complaint, the City of Philadelphia asserts claims against

defendants to “redress the hazard to public health and safety,” “abate the nuisance,”

60
Id. ¶ 15.
61
Id. ¶ 157.
62
Id. ¶ 34.
63
Id. ¶ 47.
64
Id. ¶¶ 320-70.
65
Id. ¶ 18.
66
Id.

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and “recoup . . . monies that have been spent” as a result of the opioid epidemic and

the alleged misconduct of defendants in unlawfully diverting prescription opioids.67

The City of Philadelphia asserts claims on behalf of itself and argues they are

“wholly independent of any claims that individual users of opioids may have against

defendants.” 68 Philadelphia further alleges the following city-specific opioid-

related statistics:

• 963 opioid-related overdose deaths in 2019; 69

• identification of specific CVS pharmacies and purchase rates; 70

• treatment of approximately 14,000 people for opioid disorder from
October 2015 through September 2016;”71

• 651 hospitalizations due to opioid poisoning in 2018;72

• administration of naloxone over 4,000 times by the Philadelphia Fire
Department, 200 times by the Philadelphia Police Department,
5,000 in 2018 and 3,000 in 2019 by Philadelphia emergency medical
services (EMS);73

• 1,161 cases of Hepatitis C virus, which is an adverse effect common
to opioids with treatment costs of approximately $84,000 per patient
in 2016;74

67
Insurers’ Motion, Ex. 16 (“Philadelphia Compl.”) ¶ 1.
68
Id. ¶ 24.
69
Id. ¶ 557.
70
Id. ¶¶ 292-300.
71
Id. ¶ 554.
72
Id. ¶ 555.
73
Id. ¶ 561.
74
Id. ¶¶ 572, 601.

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 • increased homelessness, and arrests related to opioids;75

• treatment of 17,500 people in the publicly-funded health system for
opioid-use disorder in 2019, which incur costs from the
administration of methodone ($150 per month per person),
suboxone ($450 per month per person), and Vivitrol ($1,000 per
month per person). 76

The Philadelphia complaint contains claims of public nuisance, statutory

violations, and unjust enrichment.77

e. The Florida Suit

In the Florida complaint, the State of Florida asserts statutory and tort-based

claims, including public nuisance and gross negligence, against manufacturer and

distributor defendants that plaintiff alleges “cooperated to sell and ship ever-

increasing quantities of opioids into Florida.” 78 The State of Florida seeks “to hold

Defendants accountable for having created and exacerbated the opioid crisis,” 79 and

having “caus[ed] the devastating public health and financial effects that have

followed.”80 The complaint alleges 779 heroin overdose deaths in Florida in 2015,81

75
Id. ¶¶ 584, 582.
76
Id. ¶¶ 590, 595, 596.
77
Id. ¶¶ 656 -720.
78
Insurers’ Motion, Ex. 17 (“Florida Complaint”) ¶ 1.
79
Id.
80
Id. ¶ 10.
81
Id. ¶ 420.

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and 21,700 opioid-related emergency department visits in 2014. 82 The complaint

additionally avers these “societal and economic injuries incurred by the State of

Florida” were foreseeable to the defendants. 83

C. THE POLICIES 84

CVS seeks indemnification and/or defense costs in connection with the

Opioid Lawsuits under the policies at issue in this action. CVS says 229 policies are

implicated between the Insurers’ Motion and the Joinder Motion.85 This dispute

centers on whether the just-described governmental plaintiffs’ lawsuits allege harms

resulting in damages because of bodily injury or property damage and trigger duty-

to-defend and/or indemnification coverage under those policies.

1. The Chubb Policies

Chubb issued annual insurance policies to CVS from 1993 to 2005 and

2008 to 2018 (the “Chubb Policies”).86 CVS purchased at least 26 Chubb Policies

82
Id. ¶ 422.
83
Id. ¶ 428.
84
CVS complained that Insurers failed to provide the Court with complete copies of the Policies.
CVS Opp’n to Insurers’ Motion at 12. The Court requested supplemental submissions during an
earlier status conference, and the parties have since provided all relevant pleadings and policies at
issue in the Motions. D.I. No. 357; see also CVS’s Supplemental Memorandum in Further
Opposition to the Insurers’ Motion for Partial Summary Judgment (“CVS Supp. Mem.”) at 1 n.1.
85
See CVS Opp’n to Insurers’ Motion at 4 (stating the Insurers sold “at least 62 primary, umbrella
and excess liability insurance policies” to CVS); CVS’s Opposition Brief to the Joinder Motion
(“CVS Opp’n to Joinder Motion”) at 1 (D.I. 326) (stating the Joining Insurers “seek[] summary
judgment with respect to an additional 167 policies for which CVS” paid).
86
See Insurers’ Motion at 10; id., Exs. 18-43.

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during the relevant period.87 And the parties have now identified the relevant

provisions of the Chubb Policies.

Chubb promised to pay on behalf of CVS “those sums in excess of the

‘retained limit’ that [CVS] becomes legally obligated to pay as damages because of

‘bodily injury’ [or] ‘property damage.’”88 Under the Chubb policies “[d]amages

because of ‘bodily injury’ include damages claimed by any person or organization

for care, loss of services or death resulting at any time from the ‘bodily injury.’”89

“Bodily injury” means “bodily injury, sickness, or disease sustained by a person,

including death resulting from any of these at any time.”90 It can include “mental

anguish or mental injury resulting from bodily injury.” 91 “Property damage” is

defined as “[p]hysical injury to tangible property, including all resulting loss of use

of that property,” and “[l]oss of use of tangible property that is not physically injured.

All such loss of use will be deemed to occur at the time of the physical injury that

caused it.” 92

If the bodily injury or property damage is caused by an “occurrence” during

87
CVS Opp’n to Insurers’ Motion at 5.
88
E.g., Insurers’ Motion, Ex. 21 § I.A; CVS Opp’n to Insurers’ Motion, Ex. 22 § I.A.
89
Insurers’ Motion, Ex. 21 § I.D; CVS Opp’n to Insurers’ Motion, Ex. 22 § I.D.
90
Insurers’ Motion, Ex. 21 § VII.C; CVS Opp’n to Insurers’ Motion, Ex. 22 § VII.C.
91
Id.; Insurers’ Motion, Ex. 21 § VII.C.
92
Id. § VII.U; CVS Opp’n to Insurers’ Motion, Ex. 22 § VII.U.

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the “policy period,” the insurance will apply. 93 An “occurrence” means “an

accident, including continuous or repeated exposure to substantially the same

general harmful conditions. All such exposure to substantially the same general

conditions shall be considered as arising out of the same ‘occurrence,’ regardless of

the frequency or repetition thereof, or the number of claimants.”94

Certain policies also contain the “Pharmacist . . . Liability Endorsement.”

(“Pharmacist Liability Endorsement”).95 The Pharmacist Liability Endorsement

states in relevant part that Chubb agrees to pay on behalf of CVS “all sums in excess

of the Schedule of Insured’s Retained Limits that [CVS] shall become legally

obligated to pay as damages because of ‘bodily injury’ arising out of a ‘pharmacist

liability incident.’”96 A “pharmacist liability incident” is an “actual or alleged

negligent act, error or omissions, . . . in the performance of a ‘pharmacist

professional service.’” 97 A “pharmacist professional service” includes the

“preparation, selling, handling or distribution of drugs.” 98 Under this Endorsement,

“occurrence” “does not include any ‘pharmacist liability incident.’”99

93
Id. § I.A.1; Insurers’ Motion, Ex. 21 § I.A.1.
94
Id. § VII.O; CVS Opp’n to Insurers’ Motion, Ex. 22 § VII.O.
95
E.g., Insurers’ Motion, Ex. 21 at End 27; CVS Opp’n to Insurers’ Motion, Ex. 22 at End. 24.
96
Id.; Insurers’ Motion, Ex. 21 at End. 27.
97
Id.; CVS Opp’n to Insurers’ Motion, Ex. 22 at End. 24.
98
Id.; Insurers’ Motion, Ex. 21 at End. 27.
99
Id.; CVS Opp’n to Insurers’ Motion, Ex. 22 at End. 24.

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 2. The AIG Policies

The AIG Policies mirror the Chubb Policies in many respects. AIG issued

annual policies to CVS from 1995 to 2000 and 2002 to 2017 (the “AIG Policies”).100

CVS purchased 36 policies from AIG.101 AIG promised to pay:

“those sums that [CVS] becomes legally obligated to pay as damages
because of ‘bodily injury’ or ‘property damage’ to which this insurance
applies. [AIG] will have the right and duty to defend [CVS] against
any ‘suit’ seeking those damages. However, [AIG] will have no duty
to defend [CVS] against any ‘suit’ seeking damages for ‘bodily injury’
or ‘property damage’ to which insurance doesn’t apply.” 102

“Bodily injury” is defined as “bodily injury, sickness or disease sustained by

a person, including death resulting from any of these at any time.” 103 “Property

damage” is defined as “[p]hysical injury to tangible property, including all resulting

loss of use of that property.”104 “Property damage” is further defined to mean “[l]oss

of use of tangible property that is not physically injured.” 105

The AIG Policies apply to “bodily injury” and “property damage” only if the

“bodily injury” or “property damage” is caused by an “occurrence” during the policy

100
See Insurers’ Motion at 10; see Chubb and AIG’s Reply Brief (“Insurers’ Reply”) Exs. 81-115
(D.I. 334).
101
CVS Opp’n to Insurers’ Motion at 6.
102
E.g., Insurers’ Reply, Ex. 107 § I.1(a).
103
Id. § V.3.
104
Id. § V.17(a).
105
Id. § V.17(b).

-17-
period.106 An “occurrence” is “an accident, including continuous or repeated

exposure to substantially the same general harmful conditions.”107 Further,

“[d]amages because of ‘bodily injury’ include damages claimed by any person or

organization for care, loss of services or death resulting at any time from the ‘bodily

injury.’”108

CVS additionally points to a “Druggists – Broadened Coverage” Endorsement

(the “Druggist Endorsement”). The Druggist Endorsement reads that “‘[b]odily

injury’ or ‘property damage’ arising out of the rendering of or failure to render

professional health care services as a pharmacist shall be deemed to be caused by an

‘occurrence.’” 109

Separately, the Insurers point to 24 AIG Policies with a “Self-Insured

Retention Endorsement” that says AIG will pay on behalf of CVS “those sums in

excess of the ‘Retained Limit’ that [CVS] becomes legally obligated to pay as

damages because of ‘bodily injury’ or ‘property damage’ to which this insurance

applies. [AIG] will have the right but not the duty to defend any ‘suit’ seeking those

106
Id. § I.1(b).
107
Id. § V.13.
108
Id. § I.1(e).
109
Id. at Druggist End.

-18-
damages.”110

3. The Joining Insurers’ Policies

The Joining Insurers issued 167 policies to CVS during the relevant period

(the “Joining Insurers’ Policies” and together with the Chubb Policies and the AIG

Policies, the “Policies”). 111 CVS purchased these policies from 37 Joining Insurers,

and the Joining Insurers’ Policies include primary, umbrella, and excess coverage.112

The Joining Insurers say their policies include “terms substantially similar to those

in the Chubb and AIG Policies.”113 CVS says “[a]t least some of [the Joining

Insurers’ Policies] impose a defense obligation and all of them impose a duty to

indemnify CVS.”114

D. OUR SUPREME COURT’S DECISION IN ACE INSURANCE V. RITE AID

Last year, the Delaware Supreme Court reversed this Court’s decision

interpreting policy language similar to that here. 115 In Rite Aid, the Supreme Court

110
Insurers’ Reply, Ex. 95 at Self-Insured Retention End. The Insurers say this Endorsement
applies to the AIG Policies attached as Exhibits 89, 91-92, 95-114 in Insurers’ Reply. See id. at
11.
111
CVS Opp’n to Joinder Motion at 1.
112
Id.
113
Joinder Motion at 2.
114
CVS Opp’n to Joinder Motion at 1 (citing Joinder Motion, Exs. B1-B3, C1-C4, D2, F1-F6,
H12-H20, N, R1-R5, W7-W20, X1-X2); see also id. (citing Notice of Joinder (D.I. 287), Exs. 5-
6, 8, 10-13)).
115
Ace Am. Ins. Co. v. Rite Aid Corp., 270 A.3d 239 (Del. 2022), rev’g, Rite Aid Corp. v. ACE
Am. Ins. Co., 2020 WL 5640817 (Del. Super. Ct. Sept. 22, 2020).

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held that underlying claims seeking non-derivative economic loss did not allege

damages because of bodily injury and therefore were not subject to coverage under

the relevant insurance policies.116

The action arose after insurers denied coverage to Rite Aid for thousands of

lawsuits seeking damages for costs arising out of Rite Aid’s distribution of

opioids.117 Given the multiplicity of lawsuits, the Supreme Court focused on the

claims asserted in the Track One Lawsuits to determine whether the claims alleged

damages because of bodily injury. 118 The insurance policies provided that the

Insurer will “pay those sums that the insured becomes legally obligated to pay as

damages because of ‘personal injury’ or ‘property damage’ to which the insurance

applies.” 119 “Personal injury” was defined in part as “bodily injury.” 120 The policy

defined “[d]amages because of ‘personal injury’ [to] include damages claimed by

any person or organization for care, loss of services, or death resulting at any time

from the ‘personal injury.’” 121

116
Rite Aid, 270 A.3d at 241, 250.
117
Id. at 242.
118
Id. at 242-43.
119
Id. at 243.
120
Id.
121
Id. The 2015 policy was also substantially similar to the terms in the other policies additional
insurers had submitted in connection with Rite Aid’s motion for partial summary judgment. This
Court also considered a 2018 policy, which differed from the 2015 Policy in that it contained an
endorsement that excluded opioid and narcotics liability claims from coverage. Rite Aid Corp.,
2020 WL 5640817 at *3-4.

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 Accordingly, coverage for damages because of personal injury was only

available to (a) the person injured, (b) a person recovering on behalf of the person

injured, or (c) people or organizations that treated the person injured or deceased,

who demonstrate the existence of and cause of the injuries.122 The Supreme Court

found that the plaintiffs in the Track One Lawsuits did not fall under category (a)

because the governmental entities themselves could not claim damages for bodily

injury.123 They also did not fall under category (b) because the institutional opioid-

litigation plaintiffs disclaimed they were asserting claims on behalf of others.124

And, with respect to category (c), the Court found that the plaintiffs were not

seeking to recover for damages for the care or death of a person resulting from bodily

injury, because the claims were “not directed to an individual injury but to a public

health crisis.” 125 To qualify for coverage then, the organization, “must show that it

treated an individual with an injury, how much that treatment cost, and that the injury

was caused by the insured.” 126 In short, the alleged damages must “depend on proof

of bodily injuries” and could not be for general, non-derivative economic loss. 127

The Supreme Court further explained it was insufficient for claims to merely

122
Id. at 247.
123
Id. at 248.
124
Id. at 247.
125
Id. at 253.
126
Id. at 252.
127
Id. at 250, 254.

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allege a “causal connection between the counties’ economic damages and the

injuries to their citizens from the opioid epidemic.”128 “There must be more than

some linkage between the personal injury and damages to recover ‘because of’

personal injury: namely, bodily injury to the plaintiff, and damages sought because

of that specific bodily injury.”129 The bodily injuries alleged in a given complaint

must do more than “explain and support” any economic loss the counties suffered.130

The individual physical injury must be “the basis of the claims,” “independently

proven, and shown to be caused by the insured.”131 Hence, the Supreme Court found

that “the Track One [Suits] have no claims for personal injury—just facts that

support the economic loss claims.” 132

E. THIS LITIGATION

Beginning in October 2017, CVS notified the Insurers of thousands of Opioid

Lawsuits, including the Track One Suits and Additional Representative Suits in

which CVS is named as a defendant. 133 CVS has sought defense and indemnification

under the Policies.134 The Insurers in return sent coverage position letters wherein

128
Id. at 241.
129
Id. at 250.
130
Id.
131
Id. at 250-51.
132
Id. at 250.
133
Insurers’ Motion at 11-12.
134
Id.

-22-
they reserved their “rights” to deny coverage under the Policies and explained why

they believe the Opioid Lawsuits aren’t covered by the Policies. 135

In the wake of Rite Aid, indeed, less than a month after that decision, Chubb

filed its complaint in this action seeking three declarations: (1) that Chubb has no

duty to defend CVS against the Opioid Lawsuits; (2) that Chubb has no duty to

indemnify CVS for the Opioid Lawsuits; and, (3) of rights and obligations, if any,

of other insurers if Chubb is found to have a duty to defend or indemnify CVS.136

Within days, AIG filed a similar action against CVS seeking declarations that AIG

had no duty to defend or indemnify CVS for the Opioid Lawsuits. 137 The Court then

consolidated the Chubb and AIG actions.138

Thereafter, the Court denied CVS’s motion to dismiss or stay this

consolidated action; that motion argued forum non conveniens.139 The Court noted

that there was likely no true conflict between Delaware and Rhode Island law but

concluded it did not need to choose between the two states’ law on the motion to

dismiss. 140

The next month, CVS filed its third-party complaint, counterclaims, and

135
Id.
136
Compl. ¶¶ 45-53.
137
Id. ¶¶ 38-45 (D.I. 1) (N22C-02-056 PRW CCLD).
138
D.I. 93.
139
In re CVS Opioid Ins. Litig., 2022 WL 3330427 (Del. Super. Ct. Aug. 12, 2022) (D.I. 198).
140
Id., at *9-10.

-23-
cross-claims. CVS asserts causes of action for (1) breach of contract, (2) breach of

the implied covenant of good faith and fair dealing, (3) statutory bad faith under

Rhode Island statutory law, and (4) a declaration that CVS has a right to have its

losses covered by the Insurers and Joining Insurers.141

Now before the Court is the Insurers’ motion seeking partial summary

judgment suggesting that under Rite Aid they have no duty to defend CVS for the

Opioid Lawsuits. The Joining Insurers, too, seek partial summary judgment that

they have no duty to defend or indemnify CVS on the same grounds. CVS opposes

both motions.

III. STANDARD OF REVIEW

Superior Court Civil Rule 56 governs a motion for summary judgment.142 The

Court may grant summary judgment only when “the record demonstrates that ‘there

is no genuine issue as to any material fact and that the moving party is entitled to

judgment as a matter of law.’” 143 At the summary judgment stage the Court

determines whether genuine issues of material fact exist, but the Court does “not

decide such issues.” 144 To achieve summary judgment, the movant must carry its

141
CVS Compl. ¶¶ 79-96.
142
See Del. Super. Ct. Civ. R. 56.
143
Parexel Int’l (IRL) Ltd. v. Xynomic Pharms., Inc., 2020 WL 5202083, at *4 (Del. Super. Ct.
Sept. 1, 2020) (quoting Del. Super. Ct. Civ. R. 56(c)).
144
Merrill v. Crothall-American Inc., 606 A.2d 96, 99 (Del. 1992) (citation omitted); see also
Oliver B. Cannon & Sons, Inc. v. Dorr-Oliver Inc., 312 A.2d 322, 325 (Del. Super. Ct. 1973).

-24-
burden to demonstrate its motion is supported by undisputed material facts.145 If the

movant is successful, then the burden shifts to the non-movant to demonstrate a

“genuine issue for trial” still exists. 146 The Court views the facts and draws all

reasonable inferences in the light most favorable to the non-movant.147

IV. PARTIES’ CONTENTIONS

The Insurers rely on the Supreme Court’s decision in Rite Aid as grounds for

partial summary judgment. They insist they have no duty to defend or indemnify

CVS for the Track One Suits and Additional Representative Suits because the

Policies cover damages incurred “because of bodily injury,” whereas the Opioid

Lawsuits seek generalized economic damages.148 And the Insurers say Rite Aid

controls because CVS has failed to identify any real or relevant conflict between

Rhode Island and Delaware law. 149

CVS makes five primary arguments that coverage is due under the Policies.

First, CVS contends Rhode Island law controls, and that under Rhode Island, claims

seeking damages because of bodily injury extend to the nine Opioid Lawsuits

145
Envolve Pharmacy Sols., Inc. v. Rite Aid Headquarters Corp., 2023 WL 2547994, at *7 (citing
Moore v. Sizemore, 405 A.2d 679, 680 (Del. 1979)).
146
Del. Super. Ct. Civ. R. 56(e).
147
Judah v. Del. Tr. Co., 378 A.2d 624, 632 (Del. 1977) (citations omitted).
148
Insurers’ Motion at 4.
149
Insurers’ Reply at 5-8.

-25-
here.150 Second, the Policies at issue in this action contain the Pharmacist Liability

and Druggist Endorsements, which “broadened coverage” and were triggered

because the Track One Suits and Additional Representative Suits allege “pharmacist

liability incidents” and “wrongful rendering of services as a pharmacist.” 151 Third,

the “property damage allegations” in these suits independently trigger coverage

under the Policies. 152 Fourth, CVS argues coverage is triggered for the nine Opioid

Lawsuits because damages “because of bodily injury” include damages “claimed”

by any person or organization for the bodily injury or death “sustained” by a person,

and here, governmental entities are claiming damages for bodily injury “sustained

by a person.” 153 Fifth, Track One Suits and Additional Representative Suits assert

“derivative claims” and are thus covered. 154

V. DISCUSSION

A. DELAWARE OR RHODE ISLAND LAW?

The first step in a conflict-of-law analysis is “to decide whether a conflict truly

exists, comparing ‘the competing jurisdictions to determine whether the laws

150
CVS Opp’n to Insurers’ Motion at 23-29.
151
Id. at 13-16.
152
Id. at 16-18.
153
Id. at 2, 19-20.
154
Id. at 18-19.

-26-
actually conflict on a relevant point.’”155 “In determining whether there is an actual

conflict, Delaware state courts . . . answer a single and simple inquiry: does

application of the competing laws yield the same result?” 156 If the answer is “yes,”

then the Court “should avoid the choice-of-law analysis altogether.”157 Moreover,

the competing laws must actually conflict to require a choice-of-law analysis.158

When one state’s laws do not address a particular issue, “it cannot conflict with the

laws of another state.” 159 “Where one state fails to address a particular issue, the

Court should apply the settled law.”160

Rite Aid is the precedential Delaware decision interpreting whether claims

seeking damages because of bodily or personal injury extend to generalized

economic losses suffered by governmental entities in seeking to abate the opioid

crisis. CVS attempts to avoid application of Rite Aid here by identifying certain

dicta in Rhode Island cases that are in seeming conflict with the Rite Aid decision.

155
In re CVS Opioid Ins. Litig., 2022 WL 3330427, at *8 (quoting Arch Ins. Co. v. Murdock, 2018
WL 1129110, at *8 (Del. Super. Ct. Mar. 1, 2018), aff’d sub. nom., RSUI Indem. Co. v. Murdock,
248 A.3d 887 (Del. 2021)). Sometimes, an initial inquiry for a choice-of-law analysis is
“determining if the parties made an effective choice of law through their contract.” See Certain
Underwriters at Llyods, London v. Chemtura Corp., 160 A.3d 457, 464 (Del. 2017). The Policies
contain no choice-of-law provisions, so that inquiry is fruitless here.
156
Arch Ins. Co., 2018 WL 1129110, at *8 (alterations in original) (quoting Laguelle v. Bell
Helicopter Textron, Inc., 2013 WL 5460164, at *2 (Del. Super. Ct. Oct. 1, 2013)).
157
Vichi v. Koninklijke Philips Elecs., N.V., 85 A.3d 725, 773 (Del. Ch. 2014).
158
Arch Ins. Co., 2018 WL 1129110, at *8.
159
Id. (citing Mills Ltd. P’ship v. Liberty Mut. Ins. Co., 2010 WL 8250837, at *4 (Del. Super. Ct.
Nov. 5, 2010)).
160
Id.

-27-
 CVS argues McEvoy v. Amica Mutual Insurance Company is controlling law

in Rhode Island and in conflict with Rite Aid on this point of damages. 161 In McEvoy,

the defendant insurer issued an automobile policy to the plaintiff. 162 The McEvoy

plaintiff’s minor daughter died from injuries sustained in a car accident. The little

girl was a passenger in one of the plaintiff’s cars covered by the policy, and the

plaintiff sought damages for both the wrongful death claim that survived the

deceased child and a loss-of-consortium claim.163 The Court found that the

automobile policy’s “each person” liability limit applied—and not the higher, “each

accident” liability limit—because in the wrongful death claim and loss-of-

consortium claim, the bodily injury occurred to only one person (the deceased child),

as oppose to two people (the deceased child and parent). 164 The Court explained that

the loss-of-consortium claim was derivative of the wrongful death claim because “all

damages for such bodily injury” include “derivative and consequential damages

payable to persons other than the one who sustains the bodily injury,” and the loss

of the deceased’s society to plaintiff derived from the wrongful death.165 Thus, the

“each person” limit of liability applied.166

161
1991 WL 789913 (R.I. Super. Ct. Nov. 12, 1991).
162
McEvoy, 1991 WL 789913, at *1.
163
Id. at *2-3.
164
Id. at *3.
165
Id.
166
Id.

-28-
 CVS misreads McEvoy as holding that all “derivative and consequential

damages payable to persons other than the one who sustains the bodily injury” are

damages because of bodily injury. The trial court in McEvoy wrote “all damages for

bodily injury” include derivative and consequential damages, not “all derivative and

consequential damages” are damages for bodily injury.167 More importantly, the

claims in McEvoy are the very type of derivative claims that “depend on proof of

personal injury” that the Supreme Court in Rite Aid distinguished from claims by

governmental entities seeking generalized economic losses in responding to the

opioid crisis. 168 In McEvoy, the plaintiff parent brought a claim on behalf of the

deceased daughter that was directly related to and predicated upon the individual

injury of the daughter. Under Rite Aid, coverage for damages because of bodily

injury extended to these types of personal injury claims asserted on behalf of other

individuals. The governments in Rite Aid simply had not brought such particularized

claims. CVS fails to demonstrate an actual conflict exists between Rite Aid and

McEvoy. 169

167
Id.
168
Rite Aid, 270 A.3d at 254.
169
CVS also cites American Universal Insurance Co. v. Costello for the proposition that Rhode
Island construes insurance policies broadly. 185 A.2d 447 (R.I. 1962). The Rhode Island Supreme
Court in Costello construed an automobile insurance policy that contained the language “damages
for bodily injury” and noted the “coverage afforded by this type of policy was clearly intended to
be broad.” Id. at 192, 196. The inference CVS draws is that the Delaware Supreme Court
construes insurance policies narrowly. Not so. Simply because the Rhode Island Supreme Court
stated an auto insurance policy should be broadly construed does not mean it conflicts with
Delaware law. Nowhere in Rite Aid does the Supreme Court make any mention it is construing
-29-
 For the Court to engage in the choice-of-law analysis, the competing laws

must actually conflict. 170 CVS has not shown the two states’ laws conflict. So, the

Court applies Delaware law. 171

B. THE POLICIES AND “BODILY INJURY”

Whether the Policies fall within the scope of Rite Aid depends on the language

of the Policies and a reasonable reading of the complaints in the Track One Suits and

the Additional Representative Suits.

“In construing the language of [an insurance policy,] the Court should

interpret the language in the same manner as it would be understood by an objective,

reasonable third party.” 172 The Court first should “seek to determine the parties’

intent from the language of the insurance contract itself—the ‘mutual intent at the

the policy narrowly. And no doubt, Delaware law on this point seems to be in harmony with our
sister. See, e.g., Monzo v. Nationwide Property and Casaulty Ins. Co., 249 A.3d 106, 118 (Del.
2021) (“[I]f there is more than one reasonable interpretation of an insurance policy, Delaware
courts apply the interpretation that favors coverage.”); Northrop Grumann Innovation Systems,
Inc. v. Zurich Am. Ins. Co., 2021 WL 347015, at *9 (Del. Super. Ct. Feb. 2, 2021) (“[A] truly
ambiguous insurance contract will be construed most strongly against the insurer and in favor of
the insured.”), app. refused, 2021 WL 1043988 (Del. Mar. 18, 2021).
170
Arch Ins. Co., 2018 WL 1129110, at *8.
171
CVS argues that Rhode Island prohibits the consideration of extrinsic evidence, citing a
Verdict Form and Abatement Order, as well as insurers’ subjective intent. CVS Opp’n to Insurers’
Motion at 29-31. The Court does not rely on any extrinsic evidence or insurers’ subjective intent
to reach its decision here.
172
Rite Aid, 270 A.3d at 245 (alteration in original) (quoting IDT Corp. v. U.S. Specialty Ins. Co.,
2019 WL 413692, at *7 (Del. Super. Ct. Jan. 31, 2019)); Osborn ex rel. Osborn v. Kemp, 991 A.2d
1153, 1159 (Del. 2010) (“Delaware adheres to the ‘objective’ theory of contracts, i.e., a contract’s
construction should be that which would be understood by an objective, reasonably third party.”)
(quoting NBC Universal v. Paxson Commc’ns Corp., 2005 WL 1038997, at *5 (Del. Ch. Apr. 29,
2005)).

-30-
time of contracting.’”173 “Absent ambiguity, contract terms should be accorded their

plain, ordinary meaning.”174

The duty to defend is “broad.” 175 “An ‘insurer has an obligation to defend its

insured, even if the action against the insured is groundless, whenever the complaint

. . . may potentially come within the coverage of the policy.’” 176 This is true “even

when the complaint has only ‘one allegation that falls within the scope of the policy’s

coverage . . . [and] even if an insured is ultimately found to be not liable.’”177

Furthermore, “when the complaint alleges ‘facts which would support a recovery

that is covered by the policy, it is the duty of the insurer to defend until such time as

the claim is confined to a recovery that the policy does not cover.’” 178

173
Rite Aid, 270 A.3d at 245 (quoting Alstrin v. St. Paul Mercury Ins. Co., 179 F. Supp. 2d 376,
388 (D. Del. 2002)); Goggin v. Nat’l Union Fire Ins. Co. of Pittsburgh, 2018 WL 6266195, at *4
(Del. Super. Ct. Nov. 30, 2018); see also Emmons v. Hartford Underwriters Ins. Co., 697 A.2d
742, 745 (Del. 1997) (“The scope of an insurance policy’s coverage . . . is prescribed by the
language of the policy.”) (citing Rhone-Poulenc Basic Chems. Co. v. Am. Motorists Ins. Co., 616
A.2d 1192, 1195-96 (Del. 1992)).
174
Rite Aid, 270 A.3d at 245 (citing Alta Berkeley VI C.V. v. Omneon, Inc., 41 A.3d 381, 385
(Del. 2012)).
175
Id. at 246.
176
Id. (quoting Heffernan & Co. v. Hartford Ins. Co. of Am., 614 A.2d 295, 298 (1992)).
177
Id. (alteration in original) (quoting Nationwide Mut. Ins. Co. v. Garzone, 2009 WL 2996468,
at 10 (E.D. Pa. Sept. 17, 2009)).
178
Id. (quoting Erie Ins. Exch. V. Transamerica Ins. Co., 533 A.2d 1363, 1368 (Pa. 1987)).

-31-
 1. Insurers Have No Duty to Defend CVS for The Track One Suits
Because Those Plaintiffs Do Not Seek Damages “Because of Bodily
Injury.”

Under Rite Aid, the Track One Suits are not subject to coverage.

First, the Cuyahoga and Summit complaints are substantively identical. Both

assert claims against CVS based on CVS’s alleged role in distributing and dispensing

opioids, and both provide allegations illustrating the harm and costs incurred in each

county in responding to the crisis. 179 Both also assert similar statutory and common

law nuisance and negligence claims.180 While the Rite Aid court focused on the

Cuyahoga complaint, that complaint provided more particularized allegations than

Summit. And so, the Rite Aid holding that applied to Cuyahoga applies just as well

to Summit—if not with greater force. For example, while Summit includes

allegations of the specific number of deaths, overdoses and overall costs incurred by

county departments, Cuyahoga goes further and provides the specific costs of

treatments and the number of individuals treated for opioid-related use.181

Second, the policy language the Supreme Court interpreted in Rite Aid is

substantively identical to the policy language at-issue here. In Rite Aid, the insurers

contracted to pay damages “because of ‘personal injury’” or “property damage.”182

179
See generally Summit Compl., and Cuyahoga Compl.
180
See Summit Compl. ¶¶ 975-1072, 1091-1138; Cuyahoga Compl. ¶¶ 1017-1115, 1134-1179.
181
Supra notes 24-27; cf., 33-41.
182
Rite Aid, 270 A.3d at 243.

-32-
Too, covered damages “because of ‘personal injury’ include[d] damages by any

person or organization for care, loss of services or death resulting at any time from

the ‘personal injury.’” 183 And “personal injury” was defined as “bodily injury”

meaning “bodily injury, sickness or disease sustained by a person, including death

resulting from any of these at any time.”184

Here, the Chubb and AIG Policies (and Joining Insurers’ Policies) contain

nigh-on identical language. They cover damages “because of ‘bodily injury’ or

‘property damage,’” and in some cases, “‘bodily injury’, ‘property damage’, or

‘personal or advertising injury.’” 185 “Bodily Injury” is consistently defined across

the Policies as “bodily injury, sickness or disease sustained by a person, including

death resulting from any of these at any time,” and may “include mental anguish or

mental injury resulting from bodily injury.” 186 Given that “personal injury” is

defined as “bodily injury” under the policies in Rite Aid, the Policies here are in all

substantive respects identical with those in Rite Aid. For these reasons, Rite Aid

extends to the Track One Lawsuits asserted against CVS.

Under Rite Aid, damages for bodily injury are covered losses only when

183
Id.
184
Id.
185
See, e.g., Insurers’ Motion, Exs. 21, 22; Insurers’ Reply, Ex. 107. “Personal or advertising
injury” is not a term at issue.
186
E.g., Insurers’ Motion, Ex. 21 § VII.C.

-33-
asserted by (a) the person injured, (b) a person recovering on behalf of the person

injured, or (c) people or organizations that treated the person injured or deceased,

who demonstrate the existence of and a cause of the injuries. 187 The claims in the

Cuyahoga and Summit complaints are brought by governmental entities seeking

recovery of economic losses in responding to the opioid crisis. They are not claims

brought by the person injured, because the governmental entities do not claim they

themselves have suffered bodily injury. They also are not bringing claims on behalf

of an individual person injured. Indeed, they disclaim personal injury claims and do

not base the claims on the injuries of others. 188 Finally, the claims are not seeking

to recover for the care incurred in treating a person injured or deceased because they

seek general economic losses in responding to the opioid crisis. Though the

Plaintiffs in Rite Aid highlighted county-specific statistics in the Cuyahoga

complaint to try to demonstrate that the claims were seeking recovery for the costs

incurred in the treatment of the individual citizens, a close examination of the

allegations in the Track One Suits reveals that the most particularized allegations are

intended only to illustrate the economic losses suffered by the counties. They are

not, in fact, the “basis of the claims.”189

187
Rite Aid, 270 A.3d at 247.
188
Summit Compl. ¶ 1038, Cuyahoga Compl. ¶ 1080.
189
See generally Summit Compl. and Cuyahoga Compl.; id. at 250-51; Rite Aid, 270 A.3d at 250-
51.

-34-
 2. Insurers Have No Duty to Defend CVS for the Additional
Representative Suits Because the Plaintiffs Do Not Seek Damages
“Because of Bodily Injury.”

A review of the Additional Representative Suits shows there are no substantial

differences from the Track One Suits. Each Additional Representative Suit alleges

similar misconduct by CVS in its failure to properly distribute and/or dispense

opioids. Thus, Rite Aid extends to the Additional Representative Suits.

Like the Track One Suits, the claims in the Additional Representative Suits

do not fall under any of Rite Aid’s three categories of coverage. They are claims

brought by governmental entities seeking a combination of common law or statutory

negligence or nuisance claims. They do not seek to recover for personal injury those

entities themselves have suffered. And, they either specifically disclaim that they

seek to recover on behalf of others.190 Or, if they do not, the nature of the allegations

and the specific damages they seek again impart that they are seeking to recover

generalized economic losses in responding to the opioid crisis. 191

What’s more, though each Additional Representative Suit makes allegations

190
See Summit Compl. ¶ 1032-33, Cuyahoga Compl. ¶ 1074-75; Cherokee Compl. ¶ 13;
Philadelphia Compl. ¶ 24.
191
CVS attempts to contort certain complaints as asserting derivative claims under (b). For
instance, CVS argues that the Florida and Summit complaints are derivative actions brought on
behalf of individuals suffering bodily injury relaying the basis of a single allegation that certain of
the claims were brought “on behalf of” the residents. CVS Opp’n at 11, 18-19. But CVS provides
no additional explanation and fails to demonstrate that those exemplative claims actually rely on
proof of any individual’s bodily injury.

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specific to each governmental entity, even the most detailed of those allegations

move the needle no further in showing that the claims fall under any one of the three

categories defined in Rite Aid.192 For example, CVS highlights allegations in the

Philadelphia complaint that specify the number of people the city treated with opioid

disorders year-over-year; the number of doses of naloxone administered and the

approximate cost per dose; and the cost per person per month for certain drugs

Philadelphia provided. 193 But our Supreme Court in Rite Aid rejected the notion that

such allegations of aggregate costs in the Cuyahoga complaint transformed the

prayers pled into personal injury claims.194 Just so here. The basis of each

underlying claim in the Philadelphia complaint, as well as the other Additional

Representative Suits, is not “connected to [ ] personal injury, independently proven,

and shown to be caused by the insured.” 195

In sum, none of the Additional Representative Suits comprise the personal

injury claims Rite Aid would recognize as triggering coverage under the requirement

that such claims must truly be seeking damages because of bodily injury to an

192
The Philadelphia Complaint alleges the most particularized facts when compared to the other
Additional Representative Suits, whereas the New York suits provides the barest county-specific
allegations. See, e.g., Philadelphia Compl. ¶¶ 292-300, 554-557, 561, 572, 582, 584, 590, 595-96,
601; cf., Suffolk and Nassau Compls.
193
CVS Opp’n to Insurers’ Motion at 9; see also Philadelphia Compl. ¶¶ 590, 595-96, 606.
194
See Rite Aid, 270 A.3d at 246.
195
See id. at 251.

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individual.

3. Inclusion of Pharmacist Liability Endorsement and Druggist
Endorsement Is of No Moment; The Threshold Requirement That
Damages Must Be Because of Bodily Injury or Property Damage
Adheres Thereto.

CVS contends the Pharmacist Liability Endorsement in the Chubb Policies

and the Druggist Endorsement in the AIG Policies broaden coverage. The

Pharmacist Liability Endorsement states in relevant part that Chubb agrees to pay

on behalf of CVS “all sums in excess of the Schedule of Insured’s Retained Limits

that [CVS] shall become legally obligated to pay as damages because of ‘bodily

injury’ arising out of a ‘pharmacist liability incident.’” 196 A “pharmacist liability

incident” is an “actual or alleged negligent act, error or omissions, . . . in the

performance of a ‘pharmacist professional service. 197’” A “pharmacist professional

service” includes the “preparation, selling, handling or distribution of drugs.” 198

CVS says the “arising out of” language should be construed broadly under

Delaware law. 199 Additionally, CVS argues it faced allegations related to the

preparation, selling, handling or distribution of prescription drugs that should trigger

coverage under the Chubb Policies.200

196
Insurers’ Motion, Ex. 21 at End. 27; CVS Opp’n to Insurers’ Motion, Ex. 22 at End. 24.
197
Id.
198
Id.
199
CVS Opp’n to Insurers’ Motion at 2, 13-14.
200
Id. at 14.

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 Yet the problem with CVS’s construction is that the claims must first satisfy

the threshold requirement that they seek “damages because of bodily injury.” If the

claims ab initio seek damages because of bodily injury, then the next question is

whether the damages arose from “an occurrence.” The Pharmacist Liability

Endorsement modifies the “occurrence” requirement. It does not expand the scope

of—nor in any other way alters—the separate threshold requirement that claims

must seek damages because of bodily injury. Because the Track One Suits and

Additional Representative Suits don’t assert claims seeking damages because of

bodily injury, the inclusion of the Pharmacist Liability Endorsement changes

nothing.

The same with respect to the Druggist Endorsement. That Endorsement

allows “‘[b]odily injury’ or ‘property damage’ arising out of the rendering of or

failure to render professional health care services as a pharmacist shall be deemed

to be caused by an ‘occurrence.’”201 Again, the “occurrence” must be causation of

specific identified individualized bodily injury or property damage, not generalized

governmental economic loss. In this regard, the Druggist Endorsement is and acts

no differently than the Pharmacist Liability Endorsement.

201
Insurers’ Reply, Ex. 107 at Druggist End.

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 4. CVS Fails to Demonstrate That the Policies’ Language Warrants a
Departure from Rite Aid.

In a last-breath attempt to draw distinctions in the policy language, CVS

makes poorly developed arguments that the differences in language such as

“sustain,” “claim” and the inclusion or omission of words such as “any,” “a” and

“the” have transformative significance here. 202 The Policies define bodily injury to

include “bodily injury, sickness or disease sustained by a person” and “damages

claimed by any person or organization for care, loss of services, or death resulting at

any time from the ‘bodily injury.’”203 CVS argues that “damages ‘claimed’” by any

person or organization cannot mean the same thing as “damages ‘sustained’” by a

person.204 But CVS does little to explain why this difference is significant. It says

blithely that the phrasing just cannot mean the same thing.

It is unclear what exactly CVS is arguing, but in an effort to address CVS’s

objections, one point: to the extent CVS is arguing that the difference in the policy

language shows that the policies were intended to extend to the Opioid Lawsuits

where governmental entities “claim” damages for bodily injury that they did not

themselves “sustain,” CVS is essentially describing derivative claims. Those claims,

however, must directly relate to and be predicated upon a particular bodily injury.

202
CVS Opp’n to Insurers’ Motion at 19-20.
203
See, e.g., Insurers’ Motion, Ex. 21 § VII.C; CVS Opp’n to Insurers’ Motion, Ex. 22 § VII.C.
204
CVS Opp’n to Insurers’ Motion at 19.

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None of the complaints seek to recover for damages because of the individual

injuries sustained by a person. Indeed, the complaints expressly belie such as their

grounds—they seek redress for the communal economic losses suffered.

CVS also argues the omission of “the” preceding “bodily injury” is significant

because it suggests no “direct link” between the bodily injury and the person is

required.205 CVS then claims the Policies’ grants have no such link.206 But that’s

not true. Damages for bodily injury include “damages claimed by any person or

organization for care, loss of services, or death resulting at any time from the ‘bodily

injury.’”207 In addition, CVS says the omission of “the” in damages that “include

mental anguish or mental injury resulting from bodily injury” also suggests that no

direct link is needed. 208 But CVS is not contending the complaints seek recovery of

damages for mental anguish or mental injury.

C. THE POLICIES AND “PROPERTY DAMAGE”

The property damage allegations in the Track One Suits and Additional

Representative Suits do not independently trigger coverage under the Policies.209

The rationale in Rite Aid concerning the requirement to assert claims that seek

205
Id. at 20.
206
Id.
207
See Insurers’ Motion, Ex. 21 § I.D; CVS Opp’n to Insurers’ Motion, Ex. 22 § I.D.
208
CVS Opp’n to Insurers’ Motion at 20.
209
Id. at 16-17.

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recovery of damages because of bodily injury is the same when it comes to property

damage. In Rite Aid the Supreme Court held that “[t]here must be more than some

linkage between the personal injury and damages to recover ‘because of’ personal

injury.”210 Here, “bodily injury” and “property damage” appear side-by-side in the

Policies, and there is no reason why claims based on property damage require less

of a causal relationship than that required for claims because of bodily injury.211 Just

as the individual physical injury must be “the basis of the claims,” so must the

property damage be the basis of claims for loss because of “property damage.”212

The Court is not alone here. In West National Insurance v. Quest

Pharmaceuticals,213 the Sixth Circuit analyzed its earlier decision in Lenning v.

Commercial Union Insurance214 that “purely economic damages” are “too

attenuated from a specific covered injury” to trigger coverage “‘because of’ . . .

property damage.”215 Under the opioid-related claims pled in Quest, the

governmental entities did not need to prove the underlying injury to the property in

order to recover for the costs associated in repairing the damaged property.216

210
Rite Aid, 270 A.3d at 250.
211
See, e.g., Insurers’ Motion, Ex. 21 § I.A.
212
Rite Aid, 270 A.3d at 250-51.
213
57 F.4th 558 (6th Cir. 2023).
214
260 F.3d 574 (6th Cir. 2001).
215
57 F.4th at 566; 260 F.3d at 582-83.
216
57 F.4th at 567.

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Accordingly, the court determined the plaintiffs were seeking “purely economic

damages that related to but did not directly implicate the covered injury of property

damage.”217

Same here. The Opioid Lawsuits seek nothing more than economic damages

that relate to but do not directly implicate the covered injury of property damage.

Consequently, there is no duty to provide coverage.

D. JOINING INSURERS DO NOT OWE A DUTY TO INDEMNIFY

To be sure, the duty to defend “may be broader than the duty to ultimately

indemnify.”218 The Insurers argue that if there is no duty to defend CVS for the

Track One and Additional Representative Lawsuits, there is necessarily no

corresponding duty to indemnify.219 CVS responds that only the Joining Insurers’

moved for partial summary judgment on the duty to indemnify, and that moving for

summary judgment is premature. 220

As has been shown, the nature of the claims and the relief plaintiffs seek in

the Track One and Additional Representative Suits do not depend on proof of

217
Id.
218
ConAgra Foods, Inc. v. Lexington Ins. Co., 21 A.3d 62, 72-73 (citing Am. Ins. Grp. V. Risk
Enter. Mgmt., Ltd. 761 A.2d 826, 830 (Del. 2000)).
219
Insurers’ Supplemental Memorandum in Further Support of Chubb and AIG’s Motion for
Partial Summary Judgment and the Joining Insurers’ Motion for Partial Summary Judgement
(“Insurers’ Supp. Motion”) at 5-6.
220
CVS Supp. Opp’n at 5-6.

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personal injury. It is therefore unclear how development of the facts as it relates to

any alleged individual’s personal injury in the underlying nine Opioid Lawsuits

would happen or could trigger the Insurers’ duty to indemnify. Indeed, the cases

relied upon by CVS demonstrate this point.

For example, CVS cites to Premcor Refining Group, Inc. v. Matrix Service

Industrial Contractors, Inc., for the proposition that “indemnification is ultimately

determined upon the facts as revealed during discovery or are ultimately presented

at trial.” 221 In Premcor, plaintiff operated a refinery where two workers died from

an accident.222 The workers were hired out to an independent contractor that had

entered into a service agreement with the refinery’s operator. 223 The insurance

contract provided that the independent contractor must obtain insurance for the

benefit of itself and that operator.224 To that end, the independent contractor entered

into an insurance agreement with the defendant insurance company with respect to

any liability arising out of the contractor’s operations or work. 225 After an accident

caused the death of two workers, plaintiffs in the underlying complaints brought

wrongful death claims against the refinery operators, but none against the

221
CVS Supp. Opp’n at 5-6 (citing 2009 WL 960567, at *12 (Del. Super. Ct. Mar. 19, 2009)).
222
Id. at *1.
223
Id.
224
Id.
225
Id.

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contractor.226 The operator of the refinery then brought claims against the insurance

company seeking duty-to-defend coverage and indemnification.227 In response, the

insurance company denied that the deaths were caused by the independent

contractor’s work—i.e., the basis for the duty to defend and indemnify the operator

of the refinery.228 The court granted the insurance company’s motion for summary

judgment on the duty to defend, but denied it on the duty to indemnify. 229

On the duty to defend, the court found no allegations in the underlying

complaints tying the contractor’s work to potential liability, and without that

allegation, the insurance company had no duty to defend the lawsuits raised against

the refinery operator. 230 But with respect to the duty to indemnify, it denied

summary judgment because later discovery could show the extent of the contractor’s

involvement. 231

There, reserving a ruling for indemnification later in the proceedings made

some sense to the trial judge because the estates of the deceased workers were

bringing individual derivative claims and sought damages directly based on the

personal injuries and deaths of the workers. But here, the development of allegations

226
Id. at *4.
227
Id. at *2.
228
Id.
229
Id. at *13.
230
Id. at *11.
231
Id. at *12.

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illustrating the extent of the opioid crisis will not change the fact that the plaintiffs

in these underlying complaints have asserted claims for general, economic losses to

respond to the opioid epidemic, not personal injury claims. In other words, nothing

can come about that will transmute or transform the various governmental claims

into those for bodily injury or property damage covered by the Policies.

Accordingly, because there is no duty to defend the Track One and Additional

Representative lawsuits, there is also no corresponding duty to indemnify.

VI. CONCLUSION

For the reasons stated above, the Insurers’ Motion for Partial Summary

Judgment is GRANTED, and Joining Insurers’ Motion for Partial Summary

Judgment is also GRANTED.

IT IS SO ORDERED.

Paul R. Wallace, Judge

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