Insurance companies must pay to clean up a hazardous waste dump, the Stringfellow Acid Pits.
A Riverside County, California jury on May 16, 2005 found in favor of the State of California and against CNA, Wausau, Yosemite, Horace Mann (ACE), and Stonebridge Life Insurance Company. The jury determined that there is coverage for the State of California for the clean-up of the Stringfellow Acid Pits. The jury rejected all coverage defenses raised by the insurance companies including “willful acts” under Section 533 of the California Insurance Code, concealment and lost policy defenses. The jury found that CNA, Wausau, Yosemite, Horace Mann (ACE) and Stonebridge each breached their
insurance contracts with the State.
After judgment and monetary damages are entered in favor of the State of California for the clean-up of the Stringfellow Acid Pits for the insurance companies’ breach of contract, the case now will proceed to resolution of the State of California’s bad faith claims against CNA, Wausau, Yosemite, Horace Mann (ACE), and Stonebridge again by jury trial in Riverside, California.
The jury trial began on March 21, 2005. Jury deliberations began on May 12, 2005.
There have been numerous settlements by other insurance companies of the State of California’s Stringfellow claims before the trial. Lloyd’s, Fireman’s Fund, OneBeacon, Unigard, Chubb, Peerless, Highlands, St. Paul, TIG, Hartford, and others all settled prior to the jury trial. AIG and General Re/North Star settled during the jury trial. The State of California will receive in excess of $121 million in settlements from the insurance companies that settled rather than suffering the adverse jury verdict.