Insurers Succeed in Appeal of Chemical Spills Superfund Coverage

A New Mexico property owner was wrongly awarded insurance coverage for the costs of a Superfund lawsuit over alleged chemical contamination, as the policies at issue contain absolute pollution exclusions, a federal appeals court ruled Wednesday.

The US Court of Appeals for the Tenth Circuit reversed the district court’s summary judgment holding that Fidelity & Guaranty Insurance Underwriters and Cincinnati Insurance Co. had a duty to defend Chisholm’s-Village Plaza LLC.

“We hold that the New Mexico Supreme Court would find that the policies unambiguously preclude coverage over” allegedly released contaminants, the Tenth Circuit said.

Chisholm’s was sued by the city ...