Northwest Pipe Company v. RLI Insurance Company et al

Filing 253

Order. The Court GRANTS in part Wausau's Motion 191 and ACE's Joinder 197 as stated in the 4 page attached Order. Signed on 10/21/2013 by Judge Anna J. Brown. (bb)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
NORTHWEST PIPE COMPANY, fka
NORTHWEST PIPE & CASING COMPANY,
an Oregon corporation,
Plaintiff,
v.
RLI INSURANCE COMPANY, an
Illinois corporation, and
EMPLOYERS INSURANCE COMPANY
OF WAUSAU, a Wisconsin
corporation,
Defendants.
________________________________
EMPLOYERS INSURANCE COMPANY
OF WAUSAU, a Wisconsin
corporation,
Counter-Claimant,
v.
NORTHWEST PIPE COMPANY, fka
NORTHWEST PIPE & CASING COMPANY,
an Oregon corporation,
Counter-Defendant.
__________________________________
1 - ORDER

3:09-CV-01126-BR
ORDER

RLI INSURANCE COMPANY, an
Illinois corporation,
Third-Party Plaintiff,
v.
ACE FIRE UNDERWRITERS INSURANCE
COMPANY, a Pennsylvania company,
and ACE PROPERTY AND CASUALTY
INSURANCE COMPANY, a Pennsylvania
company,
Third-Party Defendants.

BROWN, Judge.
This matter comes before the Court on Defendant Employers
Insurance Company of Wausau’s Motion (#191) for Summary Judgment
on its Crossclaim for Equitable Contribution against RLI
Insurance Company and the Joinder (#197) in Wausau's Motion
(#191) of Third-Party Defendants ACE Fire Underwriters Insurance
Company and ACE Property and Casualty Insurance Company
(collectively referred to herein as ACE).

The Court heard oral

argument on the Motions of Wausau and ACE on August 23, 2013.
At oral argument the Court requested RLI to provide
supplemental briefing to support its position by identifying the
legal standard that it alleges Wausau and ACE failed to meet.

In

response to the Court’s request, RLI filed a Supplemental
Response (#240) and Wausau and ACE filed their Sur-Reply (#245).
In its Supplemental Response, RLI withdraws its prior argument
that Wausau and ACE did not meet their burden to show the defense
2 - ORDER

costs they incurred were “reasonable and necessary”; i.e., RLI
stipulates the defense costs that have been paid by Wausau and
ACE as set out in their Motions were reasonable and necessary to
the defense of Northwest Pipe.

Pursuant to Orders (#169) and

(#233) the Court previously ruled RLI has a duty to defend
Northwest Pipe and is required to pay 43.27% of Northwest Pipe’s
reasonable and necessary defense costs.
After considering the parties’ briefs, supplemental briefs,
oral arguments, and the record as a whole, the Court GRANTS in
part Wausau’s Motion (#191) and ACE’s Joinder (#197) as follows:
1.

RLI is required to reimburse Wausau and ACE for RLI’s
share of the reasonable and necessary defense costs
incurred by Wausau and ACE as of December 1, 2012.

2.

As of December 1, 2012, Wausau incurred $2,030,573.86
and ACE incurred $2,310,673.78 in reasonable and
necessary defense costs.

3.

Pursuant to the Ninth Circuit’s ruling in Interstate
Fire & Cas. Co. v. Underwriters at Lloyd's, London, 139
F.3d 1234 (9th Cir. 1998), RLI is obligated to pay
prejudgment interest on the defense costs that it owes
to Wausau and ACE.

4.

The Court DEFERS ruling on the remainder of Wausau’s
Motion (#191) and ACE’s Joinder (#197) as to the
specific dollar amounts of defense costs and
prejudgment interest RLI is required to pay until the
conclusion of trial on the issue of the commercial
availability of insurance coverage without absolute
pollution exclusions, which will also establish whether
Northwest Pipe has any obligation to pay a share of its
defense costs.

3 - ORDER

5.

Within 14 days of the conclusion of that trial and
after the parties make reasonable efforts to reach an
appropriate stipulation, Wausau and ACE shall provide
the Court with a proposed form of judgment and
supporting documentation setting forth the amounts of
defense costs and prejudgment interest they contend RLI
owes to Wausau and ACE individually and the amounts, if
any, owed by Northwest Pipe to Wausau and ACE. Within
ten days thereafter, RLI (and Northwest Pipe, if
necessary) may submit objections to the proposed forms
of judgment. The Court will then determine whether
further briefing or oral argument will be necessary to
resolve the remaining issues raised in the pending
Motions (#191 and #197).

IT IS SO ORDERED.
DATED this 21st day of October, 2013.

/s/ Anna J. Brown
ANNA J. BROWN
United States District Judge

4 - ORDER