Environmental liability losses present unique and often complex legal issues.  Michaels, Schulwolf & Salerno can provide comprehensive legal services for these difficult issues, based on significant experience in handling all phases of coverage evaluation, analysis, claims handling and litigation against both CGL and EIL carriers.  The firm's attorneys also have broad experience in matters involving CERCLA, RCRA and other federal and state environmental regulatory schemes. 

Michaels, Schulwolf & Salerno attorneys have successfully litigated environmental coverage disputes over the course of the last three decades.  Firm attorneys have handled all phases of these complex disputes, from pre-litigation claims management and counseling, through initial complaint, discovery, dispositive motions, trial and appeal.  The firm has substantial knowledge and experience in the multiplicity of coverage issues arising in these cases, including but not limited to:

  • Duty to defend disputes and estoppel to assert coverage claims;
  • Litigation management disputes;
  • Trigger of coverage and issues concerning the allocation of damages both as between the policyholder and its insurers and among insurers;
  • Knowledge-based coverage defenses (expected or intended injury or damage, known loss, misrepresentation in insurance procurement and late notice);
  • Pollution exclusion defenses and related questions;
  • Right to insurance issues (such as the impact of corporate transactions and policy assignments on a putative policyholder's rights to seek coverage); and
  • The collateral source rule and related rules.

Significant appellate decisions in which Michaels, Schulwolf & Salerno attorneys have been lead counsel include AAA Disposal Systems, Inc. v. Aetna Casualty and Surety Co., 355 Ill.App.3d 275, 821 N.E.2d 1278, 290 Ill.Dec. 704 (Ill. Ct. App. 2nd Dist. 2005), appeal denied, 213 Ill. 2d 533 (Ill. 2005), Reliance Insurance Company v. Raybestos Products Company, 382 F.3d 676 (7th Cir. 2004); Northern Illinois Gas Company v. The Home Insurance Company, 334 Ill.App.3d 38, 777 N.E.2d 417, 267 Ill.Dec. 614 (Ill. App. Ct. 2002), appeal denied 202 Ill.2d 614 (Ill. 2002) and Maremont Corp. v. Continental Casualty Company, 326 Ill.App.3d 272, 760 N.E.2d 550, 260 Ill.Dec. 133 (Ill.App.Ct. 2001), appeal denied 198 Ill.2d 617 (Ill. 2002) (see Results)

As a recent example of our success in these matters, in the Cinergy suit (see Results) Mr. Schulwolf, Mr. Michaels and other firm attorneys filed the only declaratory judgment action in the country at the time involving general liability coverage claims by utilities for the consequences of their alleged failure to comply with the Clean Air Act’s New Source Review pre-construction permitting requirements.  The firm also obtained summary judgment in its client’s favor in an analogous Clean Water Act coverage action, in which the City of Evansville, Indiana sought to force its insurers to pay for various improvements to its sewer system that the carriers assert are regulatory compliance costs and not environmental cleanup costs.  Michaels, Schulwolf & Salerno handled the appeal which was the affirmed by the Indiana Court of Appeals. 

Michaels, Schulwolf & Salerno attorneys also recently succeeded in obtaining summary judgment on the issue of allocation in a complex long-tail environmental coverage dispute in Missouri in a case of first impression.  In that matter the policyholder sought to hold all insurers jointly and severally liable for decades of environmental contamination taking place at many sites scattered throughout the United States. Michaels, Schulwolf & Salerno obtained summary judgment in favor of its client, with the Missouri circuit court holding that any covered damages would be allocated on a pro rata by time-on-the-risk basis. The matter remains in ongoing litigation and a post-trial appeal is anticipated.

For more information contact Jan Michaels.