Case 1:09-cv-00285-S-LDA Document 1

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UNITED STATES DISTRICT COURT DISTRICT OF RHODE ISLAND CENTURY INDEMNITY COMPANY, Plaintiff,

CIVIL At^ai NO.

LIBERTY MUTUAL INSURANCE COMPANY, Defendant.

COMPLAINT Plaintiff Century Indemnity Company, by its attorneys, for its Complaint against defendant Liberty Mutual Insurance Company, says: PARTIES 1. Century Indemnity Company, as successor to CCI Insurance Company, as

successor to Insurance Company of North America ("Century"), is a Pennsylvania corporation with its principal place of business in Philadelphia, Pennsylvania. 2. On information and belief, Liberty Mutual Insurance Company ("Liberty

Mutual") is a Massachusetts corporation with its principal place of business in Boston, Massachusetts. JURISDICTION AND VENUE 3. This Court has jurisdiction over this matter pursuant to 28 U.S.C. 1332,

diversity of citizenship, because Century and Liberty Mutual are citizens of different states and the amount in controversy is in excess of $75,000.

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4.

This Court has personal jurisdiction over Liberty Mutual because Liberty

Mutual has been registered to do business and has transacted business in Rhode Island. 5. Venue in this district is appropriate because a substantial part of the events

or omissions giving rise to this claim occurred in this district. ANTECEDENT LITIGATION 6. As set forth in greater detail below, this case arises out of a previous

insurance coverage action in this court, styled, Emhart Industries, Inc v. Home Insurance Co., et al., Case No. 02-053S, in which Emhart Industries Inc. ("Emhart") sought a declaratory judgment against several insurers for insurance coverage including defense costs and indemnity resulting from an EPA ordered remediation at Emhart's former manufacturing site in North Providence, Rhode Island. Emhart's claims for coverage were based on insurance policies issued to Emhart's predecessors over several decades by several defendants, including Century and Liberty Mutual. 7. Emhart settled with Liberty Mutual. Century prevailed with respect to

indemnity, but was found liable for and ordered to pay defense costs. 8. In this case, Century seeks the equitable remedy of contribution because it

was forced to pay more than its equitable share of Emhart's defense costs and Liberty Mutual did not pay its equitable share of Emhart's defense costs. FACTS 9. Century issued a primary and an excess policy to Crown-Metro, Inc., an

indirect predecessor to Emhart. The primary policy was in effect from February 15, 1969 to January 1,1970 and had a $100,000 coverage limit. The excess policy was in effect for thirteen months from December 1,1968 to January 1, 1970. The limits under that policy were $1 million in excess of $100,000.

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10.

Liberty Mutual issued eight successive primary policies to USM

Corporation, a direct predecessor of Emhart. The policies were in effect from November 1,1971 to January 1, 1979. The limits under each policy were $2 million. Each policy included a duty to defend USM Corporation. 11. In July 1999, Emhart gave Liberty Mutual notice of a claim the EPA had

asserted against Emhart based on dioxin contamination at the Centredale Manor Restoration Superfund Site in North Providence, Rhode Island (the "Site"). Emhart demanded that Liberty Mutual provide a defense and indemnify Emhart based on the policies Liberty Mutual issued to USM Corporation. 12. In May 2000, Liberty Mutual advised Emhart that Liberty Mutual would

not be providing Emhart with a defense or indemnification because Liberty Mutual claimed there was no potential obligation to defend or indemnify. 13. In January 2002, Emhart commenced an action in the United States

District Court for the District of Rhode Island, Civil Action No. 02-053 S, against Century, Liberty Mutual, and other insurers seeking insurance coverage for the EPA's claim against Emhart and its predecessors based on the dioxin contamination at the Site. Emhart sought a declaratory judgment and damages for breach of contract against Century under the policies Century issued to Crown-Metro and against Liberty Mutual under the policies Liberty Mutual issued to USM Corporation. 14. With their respective answers to Emhart's complaint, Century and Liberty

Mutual each filed cross-claims against the other seeking equitable allocation in the event the court were to enter judgment in favor of Emhart against one or both of them. The district court

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later entered orders preserving the right to assert or reassert cross-claims until thirty days following the date of entry of a final judgment, including all appeal periods. 15. Liberty Mutual filed a motion for summary judgment seeking a

declaration it had no duty to defend Emhart. The magistrate judge recommended that Liberty Mutual's motion be denied. 16. In March 2005, Black & Decker (Emhart's corporate parent) and Liberty

Mutual entered into a global settlement agreement which encompassed more than eighty (80) sites. In that settlement agreement, Liberty Mutual and Emhart attributed only $250,000 to defense costs relating to the Site. The Liberty Mutual settlement contained no release of Emhart's claims against Century. 17. Upon the settlement, the district court dismissed Emhart's claims against

Liberty Mutual with prejudice and dismissed Century's cross-claim against Liberty Mutual without prejudice. 18. On November 16, 2007, the district court entered judgment against

Century in favor of Emhart in the amount of $4,211,186.66 for defense costs, plus pre-judgment interest in the amount of $1,533,911.63, plus post-judgment interest at a rate to be calculated in accordance with 28 U.S.C. 1961. 19. Century filed a timely appeal from the court's judgment. The United

States Court of Appeals for the First Circuit affirmed. On May 1, 2009, the First Circuit issued its mandate. 20. of the judgment. On May 14,2009, Century paid Emhart $6,067,290.11 in full satisfaction

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EQUITABLE CONTRIBUTION 21. Century is entitled to equitable contribution from Liberty Mutual. Liberty

Mutual had a duty to defend Emhart in connection with the EPA's claim against Emhart based on the dioxin contamination at the Site. Century has paid more than its equitable share of the defense costs and Liberty Mutual has not paid its equitable share.

WHEREFORE, Century respectfully requests that the Court enter judgment in its favor against Liberty Mutual in an amount the Court determines to be equitable based on a comparison of the number of months and limits of Century's policies issued to Crown-Metro with the number of months and limits of Liberty Mutual's policies issued to USM Corporation, plus interest, costs, and attorneys' fees.

Dated: June 26,2009

sT.McCormick(#2614) ENNA & MCCORMICK 128 Dorrance Street, Suite 330 Providence, RI 02903 (401)831-2970 (401) 751-1797 Fax mclaw@choiceonemail.com Of Counsel Lawrence A. Nathanson Siegal & Park 533 Fellowship Road, Suite 120 Mt. Laurel, NJ 08054 (856) 380-8910

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John L. Altieri, Jr. Boutin & Altieri, P.L.L.C. 1261 Post Road Fairfield, CT 06824 (203) 292-6882