Metropolitan Life Insurance Company v. Aetna Casualty & Surety Company

Metropolitan Life Insurance Company (Metropolitan) (plaintiff) insured employee-healthcare plans for manufacturers and distributors of asbestos and products containing asbestos. During the 1930s, Metropolitan, through its assistant medical director Dr. Anthony Lanza, engaged in medical research and generated reports about asbestos. From 1970 onward, Metropolitan was named as defendant in asbestos lawsuits. Those lawsuits alleged that Metropolitan had a duty to warn about the health risks of asbestos exposure. The lawsuits argued that as a result of Dr. Lanza’s research, Metropolitan should have known about asbestos-related health risks. The complainants in the asbestos lawsuits alleged that they suffered injuries due to asbestos exposure. Metropolitan spent hundreds of millions of dollars defending the lawsuits. Metropolitan had primary, umbrella, and first-layer excess comprehensive general-liability policies with Travelers. During this same period, Travelers and other insurers (defendants) sold excess-liability insurance policies to Metropolitan. The excess-liability policies provided coverage only after the primary and umbrella policies were exhausted. The primary and umbrella policies were exhausted when the costs of defending asbestos claims had exceeded $25 million per occurrence. The primary and umbrella policies grouped all damages “arising out of continuous or repeated exposure to substantially the same general conditions” into one occurrence. Occurrence was not defined. The trial court granted summary judgment in favor of the defendants, holding that Metropolitan’s failure to warn was not a single occurrence. Instead, the court concluded that each claimant’s exposure to asbestos was a separate occurrence. Metropolitan appealed.