Ruling affirmed against Berkshire unit in Montana asbestos case

The Montana Supreme Court Tuesday affirmed a lower court judgment that a Berkshire Hathaway Inc. unit must pay $97.8 million in asbestos claims and other costs to the state under a comprehensive general liability policy it issued for 1973 through 1975.

The 69-page, 6-1 majority ruling in National Indemnity Co. V. State of Montana essentially affirms a March 2018 ruling against the Berkshire Hathaway unit by a lower court in Bozeman.

The court held in the earlier ruling that the state knew about hazardous conditions, injuries and deaths related to a vermiculite mine in Libby, Montana, since 1942.

The mine, which later became a Superfund site, was owned and operated by W.R. Grace and Co. and its predecessors. The insurance-related dispute concerned underlying litigation against the state related to its regulatory role.

In August 2019, the lower court followed up its ruling with a judgment holding National Indemnity was obliged to pay the state $97.8 million.

According to the Supreme Court ruling, this consists of $26.8 million for the remainder of a 2009 global settlement, giving credit to National Indemnity for $16.1 million it had contributed, and $21.3 million in accompanying prejudgment interest; $29.6 million to indemnify the state for settlements paid to claimants exposed during the policy period and $4.9 million in accompanying prejudgment interest; $6.9 million for the state’s attorneys fees and costs paid for defending the claims between 2005 and 2019; $4.9 million for prejudgment interest on the state’s claim defense costs; and $3.6 million for the state’s attorneys fees and costs incurred in defending the litigation through March 2019.

The court remanded two issues to the lower court: the number of occurrences under the policy and the resulting calculation of policy limits, and the eligibility of claimants exposed to asbestos only prior to the policy period.

A dissenting opinion said National had not breached its duty to defend the state.

Attorneys in the case did not respond to requests for comment.