JurisdictionUnited States


Trigger of Coverage

A. Policy Format and Structure

The Commercial General Liability Policy (“CGL”) may be written line by line (monoline) or as part of a commercial package program. The substantive coverage provisions are identical in both the old and new forms of CGL. The only difference between them is the “trigger.”

The term “trigger” refers to the event, accident, occurrence, or claim that causes the policy to provide defense and indemnity for the insured. The question of the trigger of coverage has been the subject of extensive litigation. Depending on fact situations, some courts have applied different triggers to the same policy wording.

Triggers that have been adopted by various courts include:

the manifestation trigger : coverage applies when an injury first manifests, or is capable of being observed; the actual injury trigger : coverage applies when the injury actually happens to the claimant; the first injury trigger : in multiple injury cases, like asbestosis where the claimant ingests the damage causing fibers over a period of years, the first ingestion of a thread of asbestos fiber is the triggering event; the discovery of injury trigger : coverage applies when the injured party learns of his or her injury, regardless of when the injury occurred; the triple trigger : a multiple of all of the other triggers designed to provide the broadest coverage available to the claimant; and the continuous trigger : a continuous occurrence of, for example, environmental pollution triggers claims under multiple primary insurance policies.

The insured is entitled to secure coverage from a single policy of their choice that covers “all sums” incurred as damages “during the policy period,” subject to that policy’s limit of coverage. In such an instance, the insurers who pay bear the burden of obtaining contribution from other applicable primary insurance policies as they deem necessary.

There has been a flood of asbestos-related litigation in the United States starting in the 1970s and culminating in the 1990s. Because corporations were filing bankruptcy as a result of thousands of suits that claimed that asbestos had caused damage over a period of time as long as 30 years, insurance coverage issues became vicious. Courts worked to provide the most coverage available to the insured so that money would be available to pay the “victims” who ingested asbestos fibers and eventually contracted cancer, mesothelioma, or lung cancer.

The result of the concern for the victims of asbestos that made multiple years of insurance coverage and the assets of the manufacturers and distributors of asbestos available caused legal abuse of the insurers and the corporations they insured. The law of unintended consequences raised its ugly head.

Consider the news reports concerning asbestosis and silicosis where it was disclosed that many of the claims were the result of fraud. For example, U.S. District Judge Janis Jack of the Southern District of Texas conducted depositions in her courtroom of doctors and others who helped create multiple cases of silicosis. Wade Goodwyn reported for National Public Radio1in 2006 on one of the depositions of a doctor who testified about the injuries he diagnosed about one of the plaintiffs.

Ray Harron from West Virginia, a doctor who reads x-rays taken by others and then gives opinions used in court is responsible for at least 88,000 legal claims. In Judge Jack’s court, Dr. Herron’s reputation was weakened when defense lawyers started producing evidence of double diagnoses and diagnoses not based on fact or medical science.

In one courtroom exchange, briefly shown below, a defense lawyer asked Harron how it was possible that his asbestos diagnosis of a man named Kimball seemed to disappear eight years later, when Harron diagnosed Kimball with silicosis. In the deposition the following occurred:

[Defense] LAWYER: “And as a matter of fact, you said that somebody with those fibers and scars in their lungs are gonna go to their grave with them, right?”
[Dr] HARRON: “Right.”
LAWYER: “Not Mr. Kimball.”

The defense then displayed a later set of x-rays. In these films, Kimball now has silicosis, but his asbestosis has cleared up. Judge Jack pressed Harron to explain. She asked, “So now his asbestosis is gone?”

HARRON: “Well, I can’t say that it’s gone, your honor.”
JUDGE JACK: “Well, where’d it go?”
HARRON: “Like I say, I don’t know.”

Dr. Harron was later warned to obtain counsel to defend him against criminal charges of being involved in a fraud. He has since refused to testify and asserted his Fifth Amendment privilege against self-incrimination.

In his article, Goodwyn summed up:

Judge Jack’s methods of deposition and her ruling are beginning to have an impact around the country. In Florida, a judge has ordered silicosis plaintiff lawyers to produce detailed medical information on their claims. In Ohio, a state court handling 35,000 asbestos claims and 900 silica claims is considering calling hearings to depose the doctors the same way Jack did. And on Capitol Hill, the House Subcommittee on Commerce and Energy begins its investigation into the Mississippi lawsuits. Like a little legal pebble, the opinion of the nurse who became a federal judge is sending out ripples of change across the nation’s court system.

Fraudulent claims like those found by Judge Jack are, hopefully, rare. As you read the following case that helped start the glut of asbestosis and silicosis lawsuits, look at how the court applied the rules for interpreting insurance policies and whether they were intent on providing the coverage that was reasonably expected by the two parties. Also look to see if the court found a fortuitous event and how it applied that fortuitous event to the policies at issue.

In Mississippi State Bd. of Med. Licensure v. Harron, 163 So.3d 945 (Miss.App. 2014) the Mississippi Court of Appeal was called upon to affirm or reverse the decision of the Mississippi State Board of Medical Licensure (the Board) who had

disciplined Dr. Ray A. Harron for his involvement in silicosis litigation in Texas, by ordering that he never attempt to renew his lapsed medical license. As part of the discipline, the Board notified a national physician’s data bank that Dr. Harron’s actions had the potential to harm patients. Although Dr. Harron agreed to the discipline, he disagreed that his actions as an expert witness had the potential to harm patients. He therefore appealed the Board’s action to the Hinds County Chancery Court. The chancery court reversed the Board’s action, ruling that it had no jurisdiction, that its ruling lacked substantial evidence, and that its notification to the physician’s data bank was arbitrary and capricious.

Dr. Harron redifined “chutzpah” by claiming that he could testify as an expert after being found to have wrongfully diagnosed people with silicosis and asbestosis without even looking at the x-rays. He gave up his license in Texas and wished to keep his license in Mississippi.

The facts were egregious.

Dr. Harron was issued a medical license in Mississippi in 1995. It lapsed in 2007. Dr. Harron stopped seeing patients in 1995, and started working for Netherland & Mason (N & M), a Mississippi company that screened potential plaintiffs for asbestosis and silicosis-related diseases. In 2001, Dr. Harron shifted focus to screening persons for potential silicosis claims.

The filing of silicosis cases involving thousands of claimants led to the creation of a multi-district litigation (MDL) proceeding in Texas, styled In re Silica Products Liability Litigation, 398 F. Supp. 2d 563 (S.D. Tex. 2005). This case, presided over by United States District Judge Janis Graham Jack, involved 111 cases totaling over 10,000 individual plaintiffs. A Daubert hearing was held in February 2005, at which Dr. Harron, and other witnesses, testified.

Dr. Harron was involved in performing “B-reads” or producing diagnosing reports on 6,700 of the claimants in the Texas litigation. He was listed as the diagnosing physician on 2,600 of these claims. Dr. Harron testified about his practices of letting medically untrained secretaries and typists interpret his reports, insert a diagnosis, stamp his signature on the reports, and send them out with no review by him. He testified that he “might” have given a copy of his signature stamp to N & M when he “got behind on typing.” He testified that “anybody” could have stamped his signature to reports. While being questioned about how he could diagnose a specific claimant with asbestosis and later diagnose the same claimant with silicosis based on reading the same x-ray, he asked for a lawyer to represent him, and all questioning of him was halted by the judge.

Judge Jack noted during Dr. Harron’s testimony that N & M had a stack of blank reports pre-signed by Dr. Harron.

At the conclusion of the hearing, the court ruled that Dr. Harron’s proposed expert testimony (and that of some other doctors) was unreliable and excluded it. Specifically, the court found that Dr. Harron relied on medical histories performed by lawyers and nonmedical personnel, which were “so deficient as to not even merit the label. The court further found that Dr. Harron’s (and other doctors’) review of x-rays lacked quality-control measures, and produced results that were described by other experts as “staggering,” “implausibl[e],” “unsound,” and “stunning and not scientifically plausible. Judge Jack found that Dr. Harron

relied upon occupational/exposure histories and medical histories which fail to even merit the title, “history,” let alone meet the generally-accepted scientific methodology for diagnosing silicosis.
Perhaps even more stunning Dr. Harron did not read, review or even see any of the 99 diagnosing reports bearing his name. This “distressing” and “disgraceful” procedure does not remotely resemble reasonable medical practice.

In early 2007, the Texas Medical Board instituted...

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