346 A.3d 81
Del.2025Background
- CVS Health Corporation sought insurance coverage from its insurers (including Chubb and AIG) for government, hospital, and third-party payor lawsuits related to its opioid-dispensing practices and the resulting opioid epidemic costs.
- The insurers argued the lawsuits did not seek damages "because of" any specific person’s bodily injury or property damage as required under their insurance policies.
- Superior Court granted summary judgment for the insurers, relying on a prior Delaware Supreme Court decision in Rite Aid, holding that such opioid lawsuits do not trigger coverage absent specific, individualized injury allegations.
- CVS appealed, arguing that policy endorsements expanded coverage and that many underlying lawsuits alleged specific injuries or damage, or at least created potential for coverage.
- The Supreme Court of Delaware reviewed the policy language, the nature of the lawsuits, and the reach of relevant endorsements.
- The Supreme Court affirmed the Superior Court’s judgment, finding no duty to defend or indemnify CVS under the circumstances presented.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether policy endorsements broaden coverage in a material way | Endorsements expand coverage to lawsuits at issue | Endorsements only broaden "occurrence" not "because of" | Endorsements do not change the requirement for specific injury |
| Whether lawsuits alleged damages “because of” bodily injury or property damage | Many underlying suits allege or imply specific injuries | Suits only allege economic harm, not individualized injury | Lawsuits do not allege specific/individual injury or property damage |
| Application of Rite Aid: generalized vs. specific damages | Generalized costs are linked to specific injuries | Coverage only for costs tied to specific individual injuries | Generalized costs/harms do not satisfy Rite Aid; coverage denied |
| Duty to defend or indemnify under the facts alleged | Underlying allegations potentially trigger duty | No duty to defend/indemnify unless specific injury alleged | No duty to defend or indemnify absent specific individualized harm |
Key Cases Cited
- ACE Am. Ins. Co. v. Rite Aid Corp., 270 A.3d 239 (Del. 2022) (held that government opioid lawsuits seeking only economic losses are not covered as damages "because of" bodily injury)
- ConAgra Foods, Inc. v. Lexington Ins. Co., 21 A.3d 62 (Del. 2011) (setting de novo review standard for summary judgment and insurance contract interpretation)