AIG Win in Sterilization Pollution Row Cemented by Appeals Court

A federal appeals court solidified an American International Group Inc. unit’s victory in an insurance coverage dispute with medical sterilization companies over tens of millions in legal defense costs incurred defending mass tort claims over ethylene oxide emissions from a facility in Willowbrook, Ill.

The Illinois top court’s January opinion answered a question certified to it by the US Court of Appeals for the Seventh Circuit in “unequivocal terms,” a panel of appellate judges said in a Friday decision.

In a significant win for the insurance industry, the Illinois Supreme Court ruled that a government permit or regulation authorizing emissions ...