Insurance Corp. of Ireland, Ltd. v. Compagnie Des Bauxites De Guinee

Compagnie des Bauxites de Guinee (CBG) (plaintiff) was a mining company that primarily performed mining activities in the Republic of Guinea. CBG is 51% owned by Halco, Inc., which operates in Pennsylvania. Halco assists CBG with administrative operations. In 1973, Halco procured business interruption insurance for CBG. $10 million of coverage was obtained from the Insurance Company of North America. The excess $10 million was obtained through a group of 21, primarily foreign, insurers (defendants). In February of 1974, CBG experienced an interruption of business in excess of $10 million. When the excess insurers refused to pay the claim, CBG sued in the United States District Court for the Western District of Pennsylvania. The excess insurers claimed the court lacked personal jurisdiction over them and made a subsequent motion for summary judgment on that basis. As part of the motion, CBG sought discovery involving the excess insurers’ contacts with Pennsylvania. After several delays in producing the requested material, the court warned the excess insurers that if they continued to fail to produce the requested material, it would assume, pursuant to Rule 37(b)(2)(A) of the Federal Rules of Civil Procedure (FRCP), that there existed personal jurisdiction. The excess insurers did not produce the material and the court found that personal jurisdiction existed.