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The Collaborative Clearinghouse for Lawsuits and Other Claims Against ACE Group Insurance Companies

ILLINOIS UNION INSURANCE COMPANY v. TEVA PHARMACEUTICALS USA, INC. et al

ATTENTION: It is possible that this information may no longer be current and therefore may be inaccurate. The index contains both open and closed cases and is not a complete list of cases in which an ACE Insurance Group company is involved. This information is provided to give interested persons an idea of the issues disputed in the indexed cases. For a full understanding of a case, one should read the rest of the court file, including the response. For the most up-to-date and complete information on a case, visit www.pacer.gov or contact the clerk of the relevant court.

Case Number: 
2:13-cv-03869 Search Pacer
ACE Group party(s): 
Court Type: 
Federal
US District Court: 
Eastern District of Pennsylvania
Date Filed: 
Jul 2 2013

"V.
FIRST CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT THAT TEVA'S CLAIM FOR
COVERAGE IS PRECLUDED ON THE BASIS OF UNTIMELY NOTICE)
29. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 28, inclusive, as though set forth in full.

30. Pursuant to Clause V.C. of the Excess Policy, Item 7 of the Declarations to the Excess Policy, Insuring Clauses A and B of the Primary Policy and Condition (g) of the Primary Policy, it is a condition precedent to coverage under the Excess Policy that Teva provide the claims department of ACE Professional Risk Division with notice of claim within the policy period.

31. Teva did not provide the claims department of ACE Professional Risk Division with notice of the Wyeth action or the Canadian action until August 31,2011, four months after the expiration of the policy period, 16 months after a jury in the Wyeth action found Teva liable for patent infringement, and more than seven years after the first complaint in the Wyeth action was filed.

32. Illinois Union contends that notice of the Wyeth action and the Canadian action was not timely provided to Illinois Union's specified agent for notice, and thus, coverage under the Excess Policy is precluded for any loss or damage Teva has or may incur as a result of those or any related actions.

33. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

34. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under the Excess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law exists for resolution of this controversy.

35. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court.

VI.
SECOND CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT THAT TEVA'S CLAIM FOR
COVERAGE IS PRECLUDED ON THE BASIS OF ESTOPPEL)

36. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 35, inclusive, as though set forth in full.

37. By email dated May 31,2007, Teva's authorized agents represented that there have been no claims under the Excess Policy.

38. At the time this representation was made, Teva had been defending the Wyeth action for over three years.

39. Illinois Union is informed and believes, and based thereon alleges, that the representation that there were no claims was made in order to cause Illinois Union to agree to further extend the policy period of the Excess Policy, which at the time the representation was made, was set to expire on June 1,2007.

40. Based on and in reliance upon the representation that there were no claims, Illinois Union agreed to successive endorsements extending the policy period through June 1, 2011.

41. Had Teva or its agents informed the claims department of ACE Professional Risk Division of the existence of these actions, Illinois Union would have had an opportunity to exercise its rights under the Excess Policy in connection with the defense of claims.

42. Had Teva or its agents informed the claims department of ACE Professional Risk Division of the existence of these actions, Illinois Union would also have had the opportunity to end the policy period on June 1, 2007 or negotiate a higher premium for the extension of the policy period.

43. Illinois Union contends that, as a result of the acts and events detailed above, Teva is estopped from obtaining coverage under the Excess Policy for any claims that had been made against Teva as of the time these representations were made, including the Wyeth action and the Canadian action.

44. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

45. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under the Excess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law exists for resolution of this controversy.

46. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court.

VII.
THIRD CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT THAT TEVA'S CLAIM FOR
COVERAGE IS PRECLUDED ON THE BASIS OF WAIVER)

47. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 46, inclusive, as though set forth in full.

48. By email dated May 31, 2007, Teva's authorized agents represented that there have been no claims under the Excess Policy.

49. Illinois Union contends that, as a result of the acts and events detailed above, Teva has waived any rights it may have otherwise had to obtain coverage under the Excess Policy for any claims that had been made against Teva as of the time this representation was made, including the Wyeth action and the Canadian action.

50. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

51. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under the Excess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law exists for resolution of this controversy.

52. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court.

VIII.
FOURTH CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT THAT TEVA'S CLAIM
FOR COVERAGE IS PRECLUDED BY TEVA'S
BREACH OF THE CLAIM PARTICIPATION CLAUSE)

53. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 52, inclusive, as though set forth in full.

54. Clause V.E. [Claim Participation] of the Excess Policy provides that Illinois Union "shall have the right... and shall be given the opportunity to effectively associate with the Insureds in the investigation, settlement or defense of any Claim even if the Underlying Limit has not been exhausted."

55. Illinois Union contends that, by failing to provide notice to the claims department of ACE Professional Risk Division until August 31,2011, after a jury had already found Teva liable for patent infringement, Teva breached its obligation under Clause V.E. to afford Illinois Union the right to effectively associate in the investigation, settlement or defense of the claim.

56. Illinois Union contends that Clause V.E. was further breached by Teva's refusing to provide the information and documents respecting the Wyeth action and the patent at issue that were requested by Illinois Union's counsel in advance of the damages phase of the trial in the Wyeth action.

57. Illinois Union contends that the aforementioned breaches are a bar to coverage under the Excess Policy for the Wyeth action.

58. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

59. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under theExcess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law  exists for resolution of this controversy.

60. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court.

FIFTH CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT THAT TEVA'S CLAIM FOR COVERAGE IS
PRECLUDED BY TEVA'S BREACH OF THE COOPERATION CLAUSE)

61. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 60, inclusive, as though set forth in full.

62. Clause V.D. [Cooperation] of the Excess Policy provides that Teva "shall give the Insurer such information and cooperation as it may reasonably require."

63. Illinois Union contends that Clause V.D. was breached by Teva's refusing to provide the information and documents respecting the Wyeth action and the patent at issue that were requested by Illinois Union's counsel in advance of the damages phase of the trial in the Wyeth action.

64. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

65. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under the Excess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law exists for resolution of this controversy.

66. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court.

SIXTH CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT THAT TEVA'S CLAIM
FOR COVERAGE IS PRECLUDED BY TEVA'S BREACH
OF ITS AGREED DUTIES AND WARRANTIES)

67. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 66, inclusive, as though set forth in full.

68. Sections (b), (c), and (d) under the "Conditions" section of the Primary Policy and Appendix B attached to the Primary Policy set forth express duties and warranties agreed to byTeva as a condition precedent to coverage.

69. Teva has refused to provide all necessary documents establishing that these duties and warranties have been satisfied.

70. Illinois Union contends that Teva's refusal to provide those documents is a breach of those conditions, thereby precluding coverage under the Excess Policy in connection with the Wyeth action and the Canadian action.

71. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

72. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under the Excess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law exists for resolution of this controversy.

73. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court.

XI.
SEVENTH CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT THAT TEVA'S CLAIM FOR COVERAGE
IS PRECLUDED DUE TO LACK OF UNDERLYING EXHAUSTION)

74. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 73, inclusive, as though set forth in full.

75. Clause II. A. of the Excess Policy provides that no coverage is afforded under the Excess Policy unless and until "the insurers of the Underlying Policies [the Primary Policy] shall have paid, in the applicable legal currency, the full amount of the Underlying Limit and the Insureds shall have paid the full amount of the uninsured retention, if any, applicable to the primary Underlying Policy."

76. Illinois Union is informed and believes, and based thereon alleges, that the limits of the Primary Policy have not been fully paid in connection with any claim.

77. Teva has also not provided Illinois Union with information and documentation reflecting that it has paid the full amount of the uninsured retention in connection with this claim.

78. Illinois Union contends that the lack of underlying exhaustion precludes coverage under the Excess Policy.

79. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

80. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under the Excess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law exists for resolution of this controversy.

81. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court.

XII.
EIGHTH CAUSE OF ACTION
(FOR DECLARATORY JUDGMENT REGARDING
THE APPLICATION OF COINSURANCE)

82. Illinois Union realleges and incorporates by reference herein paragraphs 1 through 81, inclusive, as though set forth in full.

83. The Declarations of the Primary Policy, the Preamble of the Primary Policy, the section of the Primary Policy entitled "Limit of Indemnity," the section of the Primary Policy entitled "Coinsurance," and Endorsement No. 10 of the Excess Policy all provide that the limits of liability are reduced by a coinsurance percentage and/or "Insured's share" that is the responsibility of Teva.

84. In light of these provisions, Illinois Union contends that its liabilities under the Excess Policy in no circumstances would reach its full limits were there any coverage for the Claim.

85. Illinois Union is informed and believes, and based thereon alleges, that Teva disputes this contention and contends to the contrary.

86. An actual and justiciable controversy exists between the parties within the meaning of 28 U.S.C. §§ 2201-2202 with respect to the parties' rights and obligations under the Excess Policy. A judicial declaration is necessary so that the parties can ascertain their rights, duties and obligations under the Excess Policy. No other adequate or speedy remedy at law exists for resolution of this controversy.

87. Illinois Union has complied with all conditions precedent and all conditions subsequent such that it is entitled to seek this declaration from this Court."

The provided text is an excerpt from a document filed in this case. For a full understanding of the case, one should read the complete court file, including the response.

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