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Chubb, 3M score partial wins in product liability case


A Chubb Ltd. unit and 3M Co. each scored a partial victory in coverage litigation in a complex products liability case.

St. Paul, Minnesota-based 3M is a defendant in more than 5,000 product liability cases arising from the design and manufacture of the Bair Hugger Patient Warming System, according to Wednesday’s ruling by the U.S. District Court in Minneapolis in Federal Insurance Co. v. 3M Company.

The system, which was developed and sold by a company that 3M acquired in 2010, is designed to maintain a patient’s body temperature during surgery by forcing warm air through a blanket, according to the ruling.

It has led to thousands of product liability claims filed against 3M seeking damages for bodily injuries the system has allegedly caused, which were consolidated into multi-district litigation in the District of Minnesota, according to the ruling. Chubb unit Federal Insurance issued product liability insurance policies covering some, but not all, of the cases against 3M, according to the ruling.

Federal filed suit against 3M seeking a declaration that 3M must pay a deductible for each injury; that the defense costs of the MDL litigation should be apportioned based upon the proportion of cases that Federal’s policies cover; and that the insurer need pay only the MDL defense’s necessary and reasonable post-notice costs.

3M countersued, seeking a declaratory judgment that it need only pay one deductible per policy period; that Federal is liable for the MDL defense’s fuel cost; and that Federal is liable for breach of contract for failing to defend 3M as required by the policy contracts.

The court ruled in 3M’s favor on the deductible issue. It “is only responsible for one deductible per policy period, because the policies’ deductible’s occurrence or event language applies to the design and manufacture of the devices,” it said. It dismissed the breach of contract claim.

The decision said it was ruling on the insurer’s behalf, however, on the litigation defense costs issue. “Because MDLs are not a single, monolithic case, but rather the individual cases within an MDL remain distinct, Federal need only pay the defense costs associated with cases covered by the policies it issued, not the full cost of the MDL defense,” it said.

The court said it will not resolve what method is appropriate to calculate these costs at this time.

A 3M attorney had no comment, while Chubb’s attorneys did not respond to a request for comment.