Jeremy King Quoted in Bloomberg Law on AIG’s and Mallinckrodt Trust’s Opioid Insurance Clash

Chair of Olshan’s Insurance Coverage Practice Jeremy King was quoted in a Bloomberg Law article concerning AIG’s successful bid to avoid covering litigation against opioid manufacturing giant Mallinckrodt and the guidance it offers on a novel issue: the scope of an insurance policy exclusion for claims stemming from opioid products and efforts to market them. In a recent ruling that has implications for other high-profile fights pitting drugmakers and pharmacies against insurers seeking to avoid legal bills tied to the opioid crisis, a Missouri state court sided with AIG units and other insurers, finding that an exclusion in many of the policies at issue in the case precluded coverage for opioid-related claims against Mallinckrodt. The exclusion, contained in several primary, umbrella, and excess policies, bars coverage for claims arising out of “your products”—also known as the products hazard exclusion—and representations made about those products. The trust handling opioid claims against Mallinckrodt sued its insurers in 2022 and subsequently sought partial summary judgment on the scope of the “your products” exclusion. Jeremy explained that seeking an early decision on the exclusion was risky “because of the danger of this kind of ruling coming out and then ending your case before it begins.” Jeremy further commented that the court’s opinion shows the danger for policyholders in some case law about the broad construction of “arising out of” language. “I’m not saying that ‘arising out of’ needs to be proximate causation,” he said, “but it also shouldn’t be so broad that it captures the entirety of what a company does.”