A Pennsylvania state court judge has awarded MSA LLC, a subsidiary of safety equipment manufacturer MSA Safety Inc., nearly $47 million in punitive damages. This came after a long-running insurance coverage dispute with North River Insurance Co. The punitive damages awarded by Allegheny County Court of Common Pleas Judge Alan Hertzberg are in addition to the $10.9 million awarded by a jury to MSA LLC (formerly known as Mine Safety Appliances Co.) in a breach of contract lawsuit. The punitive damages were awarded under a Pennsylvania statute covering bad-faith claims-handling matters. Kenneth Krause, MSA Safety Chief Financial Officer, said in a statement:

We believe the outcome of this case demonstrates that our subsidiary MSA LLC has strong legal positions concerning its rights to insurance coverage and the overall collectability of the amounts owed to MSA LLC by several insurance carriers, including North River.

The litigation began in 2010, when North River sued MSA seeking a declaratory judgment that it was not obligated to cover asbestos product liability claims under three personal injury policies together dating from 1980-1983. MSA filed counterclaims for breaches of contract and bad faith.

The case went to a jury trial in September, and on Oct. 6 the jury found that North River breached the three contracts at issue. That led to the award of $10.9 million in compensatory damages, the full amount of the contractual damages at issue in the case. Judge Stanton Hertzberg then held a nonjury trial in December on the question of bad faith, which led to the most recent damages award.

MSA continues to do battle with North River and other insurers in several venues. One of these cases is scheduled to go to trial in April in the Superior Court of Delaware. Mine Safety Appliances is represented by George Stewart, Brian Himmel, Robert Nicholas and Michael Sampson of Reed Smith LLP. The case is North River Insurance Co. v. Mine Safety Appliances Co. et al, (case number GD-10-007432) in the Court of Common Pleas of Allegheny County.

Source: Law360.com

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