Plastics Engineering Company v. Liberty Mutual Insurance Compa

In the
United States Court of Appeals
For the Seventh Circuit
____________
Nos. 06-4397 & 07-1041
PLASTICS ENGINEERING COMPANY,
Plaintiff-Appellee,
Cross-Appellant,
v.
LIBERTY MUTUAL INSURANCE COMPANY,
Defendant-Appellant,
Cross-Appellee.
____________
Appeals from the United States District Court
for the Eastern District of Wisconsin.
No. 04 C 825—Aaron E. Goodstein, Magistrate Judge.
____________
ARGUED SEPTEMBER 6, 2007—DECIDED JANUARY 22, 2008
____________
Before FLAUM, MANION, and KANNE, Circuit Judges.
KANNE, Circuit Judge. Liberty Mutual Insurance Com-
pany (“Liberty Mutual”) appeals the first and third
holdings of the district court’s final declaratory judg-
ment in a case that determined the defense and indemnity
obligations of Liberty Mutual with respect to asbestos
lawsuits against Plastics Engineering Company (“Plenco”).
Plenco, in turn, appeals the second holding. The three
challenged holdings present important questions of
Wisconsin law that are presently unresolved by Wis-
2 Nos. 06-4397 & 07-1041
consin appellate courts and are likely to recur in future
lawsuits: (1) what constitutes an “occurrence” in an
insurance contract when exposure injuries are sustained
by numerous individuals, at varying geographical loca-
tions, over many years; (2) whether Wisconsin Statute
§ 631.43(1) applies to successive insurance policies; and
(3) whether Wisconsin courts would adopt an “all sums” or
pro rata allocation approach to determining liability
when an injury spans multiple, successive insurance
policies. Because current Wisconsin law does not provide
sufficient guidance as to how the Wisconsin Supreme
Court would resolve these issues, we stay this appeal and
certify three questions to the Wisconsin Supreme Court,
pursuant to Circuit Rule 52 and Wisconsin Statute
§ 821.01.
I. HISTORY
Plenco, a Wisconsin Corporation with its principal place
of business in Sheboygan, Wisconsin, began manufacturing
molding compounds in 1934. Plenco has been named as
defendant in hundreds of lawsuits for claims arising
from individuals’ exposure to the company’s asbestos-
containing products, which Plenco manufactured from
1950 until 1983. Liberty Mutual, a Massachusetts corpora-
tion with its principal place of business in Massachusetts,
provided primary general liability insurance policies to
Plenco beginning in September 1957. Plenco began pur-
chasing umbrella excess liability policies from Liberty
Mutual in May 1970, and save for a two-year period
when Plenco purchased umbrella coverage from another
insurer, continued to purchase umbrella policies from
Liberty Mutual at least until 2003. To date, Liberty
Mutual has paid all of Plenco’s defense costs, settlements,
and judgments stemming from the asbestos lawsuits.
Liberty Mutual advised Plenco in 2004 that it would
only pay “its proportionate share of reasonable and
Nos. 06-4397 & 07-1041 3
necessary defense costs.” However, Liberty Mutual has
continued to pay all of Plenco’s defense costs, settlements,
and judgments under a reservation of rights. On Septem-
ber 1, 2004, Plenco filed a complaint in district court,
against Liberty Mutual, on the basis of diversity juris-
diction. See 28 U.S.C. § 1332. Plenco sought a declaratory
judgment that Liberty Mutual was obligated, under the
terms of the insurance policies purchased by Plenco, to
fully defend and indemnify Plenco in connection with all
of Plenco’s pending and future asbestos-related law-
suits. In response, Liberty Mutual sought an opposing
declaration that it was not obligated to pay certain defense
and indemnification expenses, including some it had
been paying on behalf of Plenco, and that it was entitled
to a refund for overpaid amounts.
The parties stipulated to a joint statement of facts,
which outlined the insurance policies at issue in the suit
(primary policies between February 9, 1968, and January
1, 1989; umbrella policies from May 8, 1970, to January 1,
1984; and umbrella policies from January 1, 1986, to
January 1, 1998), and detailed the particular policy
language in dispute. Thereafter, both Plenco and Liberty
Mutual filed cross-motions for summary judgment.
The district court issued a decision and order on
October 2, 2006, which granted in part and denied in part
each party’s motion for summary judgment. On December
6, 2006, the court entered a final declaratory judgment,
to which both parties consented. Specifically, the court
concluded that: (1) per the terms of the policies in ques-
tion, each individual person’s injury caused by exposure
to Plenco’s asbestos-containing products constitutes a
separate “occurrence”; (2) when an injury is sustained over
numerous, successive policy terms, the policies’ non-
cumulation provisions—which the court held do not
violate Wisconsin Statute § 631.43(1)—limit Liberty
Mutual’s obligation for an individual claimant’s recovery
4 Nos. 06-4397 & 07-1041
to the maximum amount allowed in a single triggered
policy for an occurrence; and (3) under the terms of the
policies, Liberty Mutual is obligated to pay all sums
accruing from an injury that triggers any one policy, and
is not entitled to a pro rata contribution from Plenco
where the injury in question occurs partly within and
partly outside of the Liberty Mutual policy period.
II. ANALYSIS
In this appeal, Liberty Mutual challenges the district
court’s “occurrence” holding and its “all sums” allocation
holding. Plenco’s cross-appeal challenges the district
court’s holding on § 631.43(1). All three issues—the
definition of “occurrence” in the context of long-tail expo-
sure injuries, the applicability of § 631.43(1) to succes-
sive insurance policies, and the allocation of liability
when an injury spans multiple insurance policies—present
unsettled questions of state law that will directly affect
the outcome of this appeal, and that will undoubtedly
affect the outcome of future cases under Wisconsin law. We
consider each issue in turn, briefly discussing the argu-
ments raised by the parties and the relevant points of
Wisconsin law.
A. Definition of “Occurrence” in Asbestos Litigation
The insurance policies provide that Liberty Mutual’s
liability for bodily injury will be limited to a certain
amount per “occurrence.” Thus, the extent to which Liberty
Mutual must indemnify Plenco depends directly on the
number of occurrences underlying the asbestos law-
suits. The primary policies contain a provision qualifying
“occurrence” for exposure injuries, which stated (with
insignificant wording changes depending on the policy
year): “all bodily injury and property damage arising out
Nos. 06-4397 & 07-1041 5
of the continuous or repeated exposure to substantially the
same general conditions shall be considered as arising
out of one occurrence.” Plenco and Liberty Mutual debate
the number of occurrences underlying the lawsuits; the
district court ultimately held that each individual’s
exposure to Plenco’s asbestos-containing products consti-
tuted a separate occurrence under the insurance policies.
Wisconsin law provides some guidance as to what
constitutes an “occurrence” in insurance contracts. In
Olsen v. Moore, the Wisconsin Supreme Court adopted
the “cause theory” test for identifying an occurrence: if
a single, uninterrupted cause “results in a number of
injuries or separate instances of property damages,” it is
considered one occurrence. 202 N.W.2d 236, 240 (Wis.
1972). “If, however, that cause is interrupted or replaced
by another cause the chain of causation is broken and more
than one accident or occurrence has taken place.” Id. As
the district court pointed out, a cause and result that are
closely linked in time and space are likely to be viewed as
one occurrence. See Welter v. Singer, 376 N.W.2d 84, 87
(Wis. Ct. App. 1985).
The cause theory test for an occurrence has been
applied by Wisconsin courts in the context of exposure to
dangerous conditions. In Society Insurance v. Town of
Franklin, damages to surrounding property that were
caused by a contaminated landfill were said to have
resulted from one continuous occurrence—but the number
of occurrences was not an issue in the case. 607 N.W.2d
342, 345 (Wis. Ct. App. 2000). In Wisconsin Electric Power
Co. v. California Union Insurance Co., the Wisconsin Court
of Appeals held that there was one uninterrupted occur-
rence that began when a power supply was installed,
and continued while the power supply was in order. 419
N.W.2d 255, 258 (Wis. Ct. App. 1987). Although these
cases may be analogous to the asbestos realm, they are
different in one significant respect. In Society Insurance
6 Nos. 06-4397 & 07-1041
and Wisconsin Electric, the damage stemmed from expo-
sure that happened at one geographical site. Here, the
company manufactured asbestos at its Wisconsin plant,
but much of the exposure to asbestos happened at vary-
ing locations across the country, where Plenco’s products
were incorporated into other manufacturers’ products.
Liberty Mutual invokes the “cause test” in arguing that
there was one cause underlying all of Plenco’s asbestos
lawsuits: the continuous manufacture and sale of asbestos-
containing molding compounds. Plenco, in contrast,
argues that the manufacture of asbestos itself caused no
harm—each individual’s subsequent exposure to asbestos
caused that individual’s injury. Plenco emphasizes that
the thousands of lawsuit claimants allege asbestos expo-
sure that occurred at different locations, at different
times, under different circumstances, via different Plenco
products. Both parties cite several cases from other
states and federal courts to support their positions,
ultimately highlighting the varied interpretations other
jurisdictions have accorded the term “occurrence.”
It is clear that an occurrence under Wisconsin law can be
“ ‘ongoing’ and span a large amount of time, but still be one
occurrence within the meaning of the policy.” Jonas
Builders, Inc. v. United States Fidelity & Guaranty Co.,
639 N.W.2d 223 (Wis. Ct. App. 2001) (unpublished table
decision). However, whether the type of long-term manu-
facture of, and exposure to, asbestos at issue here consti-
tutes one occurrence under Wisconsin law is unresolved;
guidance from the Wisconsin Supreme Court would be
useful.
B. Applicability of Wisconsin Statute § 631.43(1) to
Successive Insurance Policies
Plenco argues that certain provisions in the insurance
policies violate § 631.43(a) because they limit Liberty
Nos. 06-4397 & 07-1041 7
Mutual’s liability for one occurrence to the coverage
amount of any one policy that is triggered by the occur-
rence. In so doing, the provisions eradicate significant
amounts of coverage that Plenco purchased from Liberty
Mutual over the years. Wisconsin Statute § 631.43(1),
titled “Other insurance provisions,” provides that
[w]hen 2 or more policies promise to indemnify an
insured against the same loss, no “other insurance”
provisions of the policy may reduce the aggregate
protection of the insured below the lesser of the actual
insured loss suffered by the insured or the total
indemnification promised by the policies if there
were no “other insurance” provisions.
One of the policy provisions Plenco believes violates the
statute reads, in part:
[I]f an occurrence gives rise to Bodily Injury or Prop-
erty Damage which occurs partly before and partly
within the policy period the liability of the company
under this policy for such occurrence shall not exceed
$500,000 minus the total of all payments made with
respect to such occurrence under a previous policy or
policies of which this policy is a replacement. The
policies may by their terms define the extent to which
each is primary and each excess . . . .
Liberty Mutual argues that the statute applies only
to “other insurance” provisions in policies—“other insur-
ance” provisions being particular types of clauses that
delineate the primary and excess coverage between
multiple, concurrent polices that cover the same loss. The
application of § 631.43(1) does seem to have been limited
to concurrent policies. See, e.g., id.; Tahtinen v. MSI Ins.
Co., 361 N.W.2d 673 (Wis. 1985); Krause v. Mass. Bay
Ins. Co., 468 N.W.2d 755 (Wis. Ct. App. 1991). The district
court relied on the distinction between concurrent
policies and successive policies when it held that
8 Nos. 06-4397 & 07-1041
§ 631.43(1) does not apply to the non-cumulation provi-
sions in Plenco’s policies, which are successive.
Plenco, on the other hand, argues that § 631.43(1)
generally prohibits attempts by insurers to reduce or
eliminate insurance coverage insureds have paid for.
Plenco believes the district court incorrectly held that
§ 631.43(1) applies only to concurrent insurance policies,
noting that had the legislature desired to limit the
statute in that manner, it could easily have done so by
directly writing the limitation into the provision. Further,
Plenco points to other states that have not limited the
definition “other insurance” provisions to concurrent
policies.
While issues pertaining to § 631.43(1) have arisen in
Wisconsin appellate courts, to our knowledge the specific
question at issue here—whether § 631.43(1) prohibits
an insurance company from limiting coverage for any
given “occurrence,” which triggers multiple successive
policies, to the limit of a single policy year—has never been
addressed. We therefore request guidance from the Wis-
consin Supreme Court regarding whether § 631.43(1)
applies to successive insurance policies.
C. “All Sums” or Pro Rata Allocation of Insurer Liability
The district court’s third holding addressed the alloca-
tion of liability among insurers when an injury trigger-
ing one policy occurs partly within and partly outside of
that policy period. The ultimate issue is whether an
insurer is responsible to pay “all sums” associated with the
injury, subject to policy limits, or alternatively, whether
the insurer is responsible only for a pro rata share of the
costs, based on the proportion of the injury that occurred
during the policy period. In considering the specific
contract language, the district court explained: “[a]lthough
Nos. 06-4397 & 07-1041 9
the language varies slightly throughout the numerous
policies, Liberty’s obligations can be summarized as
an obligation to pay ‘all sums’ that Plenco should be
obligated to pay as the result of personal injury that
occurred during the policy period.”
There are two sub-issues within the “all sums” allocation
debate. The first concerns the insurer’s defense obliga-
tions when an insured faces a claim that triggers one
insurance policy. The second relates to the insurer’s
indemnification obligations arising from adverse judg-
ments and settlements against the insured. The Wisconsin
Supreme Court has held that “the duty to defend is
broader than the duty to indemnify.” Reid v. Benz, 629
N.W.2d 262, 267-68 (Wis. 2001). “ ‘The duty of defense
depends on the nature of the claim and has nothing to
do with the merits of the claim.’ The duty to indemnify,
in contrast, arises when . . . the claim is within the
parameters of the policy and the insured is adjudged
liable.” Id. (quoting Elliott v. Donahue, 485 N.W.2d 403,
407 (Wis. 1992)).
1. Duty to Defend
Plenco argues that the policies unambiguously assign
to Liberty Mutual an absolute duty to defend entire
asbestos lawsuits, not just portions of such suits, and cites
Wisconsin case law to support its position. Grube v. Daun,
496 N.W.2d 106, 122 (Wis. Ct. App. 1992) (“[T]he insur-
ance company must defend the action when some of the
allegations in the complaint fall within the policy coverage
because ‘apportionment of responsibility for the defense
is neither practical nor desirable.’ ” (quoting Engsberg v.
Town of Milford, 597 F. Supp. 251, 256 (W.D. Wis. 1984)).
Liberty Mutual contends that the policies’ definitions of
bodily injury—injury occurring “during the policy pe-
10 Nos. 06-4397 & 07-1041
riod”—necessarily limits the insurer’s defense liability to
the pro rata share that corresponds with the injury
attributable to the policy period. It acknowledges that
Wisconsin law has imposed broad defense obligations on
insurers when one policy is triggered, but argues that
those obligations should not be imposed in “this context
where the defense obligation can be allocated easily.”
The issue of allocating defense costs has been litigated
in Wisconsin courts, and the law appears to favor Plenco’s
position: “[i]f some coverage exists, the insurer must
defend the entire action, even though certain allegations
may fall outside the scope of coverage.” U.S. Fire Ins. Co.
v. Good Humor Corp., 496 N.W.2d 730, 737 (Wis. Ct. App.
1993). Additionally, “the proper procedure for an insur-
ance company to follow when coverage is disputed is to
request a bifurcated trial on the issues of coverage and
liability and move to stay any proceedings on liability until
the issue of coverage is resolved.” Reid, 629 N.W.2d at 269
(citing Elliott, 485 N.W.2d at 406). Liberty Mutual has
been defending Plenco in its asbestos lawsuits for years;
there is no evidence in the record suggesting that Liberty
Mutual contested its coverage of the alleged asbestos
injuries at the outset of the lawsuits, so as to limit
its defense costs, or that it sought to stay liability pro-
ceedings to challenge coverage.
We feel that Wisconsin law generally requires insurers
to defend suits in their entirety. Nonetheless, this
issue may become more complicated if Wisconsin courts
follow a pro rata allocation approach for indemnifica-
tion liability. If damages are allocated between insurers
based on the percent of the injury that happened in each
policy period, the same principles of proration may sup-
port allocation of defense costs. As discussed below, we
are asking the Wisconsin Supreme Court to decided
whether Wisconsin law follows an “all sums” or pro rata
allocation approach, and we ask that it consider the
Nos. 06-4397 & 07-1041 11
implications for both the insurer’s duty to defend and its
duty to indemnify. We turn now to the latter.
2. Duty to Indemnify
With respect to the indemnification of damages under
the policies, Plenco again argues that the plain language
of the contracts dictates that Liberty Mutual is obligated
to pay “all sums”—not just some portion of the damages
incurred by Plenco. The insurance policies never mention
proration of liability directly, and Plenco asserts that if
its insurer is only obligated to pay a pro rata share of
the insured’s liability, Plenco’s reasonable expectation of
complete security in its insurance contracts would be
violated. Plenco contends that, at the very least, even if the
“all sums” language is ambiguous in the policies, the
ambiguity would weigh in favor of the insured and
against the insurer who drafted the contract.
Liberty Mutual, on the other hand, argues that Wiscon-
sin courts would adopt a pro rata approach to allocating
liability among insurers of long-term injuries spanning
multiple years. Liberty Mutual feels that the district
court put too much weight on the words “all sums,” while
ignoring the policies’ “bodily injury” definitions, which
Liberty Mutual believes clearly and ambiguously limited
coverage only to bodily injury that occurred during the
policy period. Liberty Mutual stresses that insurers
provide coverage for specific policy periods and argues
that they should not be forced to pay for costs related to
injuries occurring partially outside of those policy periods.
The amicus curiae, Wisconsin Utilities Association
(WUE), encourages the court to adopt an “all sums”
approach to allocation both generally and in this particular
case. WUE points out that Liberty Mutual’s policies
with Plenco contain “anti-proration clauses” that directly
12 Nos. 06-4397 & 07-1041
contemplate the insurer’s coverage of injuries that occur
“partly before and partly within the policy period.” These
clauses limit the insured’s recovery amount for any one
occurrence to the maximum of one policy, minus any-
thing already paid out under a previous policy. The
clauses WUE cites are the same clauses that Plenco
believes violate § 631.43(1). See supra Part II.B. WUE
classifies these provisions as “anti-proration clauses,”
because they “telescope” coverage for a continuing occur-
rence into one policy year. WUE claims that anti-proration
provisions are irreconcilable with the proration of a
single continuous occurrence: an insurer cannot collapse
an injury into a single policy year for one purpose (limiting
the total coverage amount), but treat it as a drawn-out
injury for another purpose (prorating costs between
insurers). WUE goes on to make policy arguments
similar to those advanced by Plenco to further its posi-
tion that an “all sums” approach to allocation is desirable
and likely to prevail in Wisconsin.
It does not appear that this issue—whether an insurer’s
indemnification duties should be limited to a pro rata
share—has been addressed by the Wisconsin Supreme
Court or the Wisconsin Court of Appeals. Both parties
and the amicus curiae rely on case law from other states,
about half of which supports an “all sums” approach, with
the other half supporting pro rata allocation. This matter
is laden with policy considerations; we believe that the
Wisconsin Supreme Court is a better-situated and more
appropriate tribunal to determine the contours of Wis-
consin Law on this issue. See Doe v. American Nat. Red
Cross, 976 F.2d 372, 374 (7th Cir. 1992) (“It would be more
appropriate for the Supreme Court of Wisconsin to ad-
dress this . . . question than the federal judiciary in view
of the fact that it is an important public policy choice that
no doubt will apply to many cases in the future.”).
Nos. 06-4397 & 07-1041 13
D. Certification Analysis
Plenco moved for certification pursuant to Circuit Rule
52, which allows us to certify to a state’s highest court
questions of state law that will control the outcome of a
pending case if the rules of the state’s highest court allow
it to entertain such questions. Cir. R. 52. Wisconsin law
permits the Wisconsin Supreme Court to consider and
respond to certified questions of state law, provided the
questions “may be determinative of the cause . . . pending
in the certifying court and as to which there is no control-
ling precedent in the decisions of the supreme court and
the court of appeals of [Wisconsin].” Wis. Stat. § 821.01.
Liberty Mutual opposes certification and points out
that Plenco filed this case in federal district court in the
first place—urging us to bind Plenco to its chosen forum.
While we do “take into account whether the request for
certification to the state court came from the party who
chose federal jurisdiction in the first place,” Brown v.
Argosy Gaming Co., L.P., 384 F.3d 413, 417 (7th Cir.
2004), this factor is not determinative on its own. If Cir-
cuit Rule 52 permits the Wisconsin Supreme Court’s
consideration of significant, state-law questions, we are
authorized to, “sua sponte or on motion of a party,” certify
those questions. Cir. R. 52.
A case is appropriate for certification where it “ ‘concerns
a matter of vital public concern, where the issue will
likely recur in other cases, where resolution of the question
to be certified is outcome determinative of the case, and
where the state supreme court has yet to have an op-
portunity illuminate a clear path on the issue.’ ” Allstate
Ins. Co. v. Menards, Inc., 285 F.3d 630, 639 n.18 (7th Cir.
2002) (quoting In re Badger Lines, Inc., 140 F.3d 691, 698-
99 (7th Cir. 1998)). Questions that are tied to the specific
facts of a case, however, typically are not ideal candidates
for certification. Id. If the outcome of a case is largely fact-
dependent, and the facts are particularized to the case,
14 Nos. 06-4397 & 07-1041
resolution of the issues by a court may have limited
precedential value; thus, certification to a state supreme
court may be inappropriate. Erie Ins. Group v. Sear Corp.,
102 F.3d 889, 892 (7th Cir. 1996); Woodbridge Place
Apartments v. Washington Square Capital, Inc., 965 F.2d
1429, 1434 (7th Cir. 1992).
The interpretation of any contract necessarily involves
analysis of the particular contract language at issue, and
application of case-specific facts. Woodbridge Place Apart-
ments, 965 F.2d at 1434. However, not all contract inter-
pretation questions are of limited precedential value
and inappropriate for certification. In Transamerica
Insurance Co. v. Henry, we asked the Indiana Supreme
Court to explain whether a certain state law rendered
Indiana a “compulsory insurance state,” and whether
the contested application of a “household exclusion
clause” in an automobile insurance policy violated the
public policy of Indiana. 904 F.2d 387, 391 (7th Cir. 1990).
A similar question regarding household exclusion clauses
was certified to the Indiana Supreme Court in Allstate
Insurance Co. v. Boles, 481 N.E.2d 1096 (Ind. 1985). Where
resolution of contract questions by a state’s highest court
will be useful beyond the parameters of the instant
dispute, and the other criteria for certification are met,
certification is appropriate.
The contract provisions in question here, while some-
what unique to the parties, contain standardized lang-
uage that undoubtedly appears in other insurance con-
tracts governed by Wisconsin law. The definition of
occurrence in the policies—an “accident, including con-
tinuous or repeated exposure to conditions, which results
in bodily injury or property damage neither expected nor
intended from the standpoint of the insured”—mirrors
standard insurance policy definitions of occurrence: “an
accident, including continuous or repeated exposure to
conditions, which results in bodily injury or property
Nos. 06-4397 & 07-1041 15
damage neither expected nor intended from the stand-
point of the insured.” John C. Yang, The Fortuity Principle:
Understanding the Fundamentals Underlying the Laws
of Insurance, 760 PLI/Lit 7 at 17 (2007). The “all sums”
provisions in the contracts likewise mirror standard
insurance policy language. See Michael G. Doherty,
Comment: Allocating Progressive Injury Liability Among
Successive Insurance Policies, 64 U. Chi. L. Rev. 257, 261
(1997) (noting that, in the standard General Commercial
Liability contract, the insurer agrees to pay “those sums
that the insured becomes legally obligated to pay as
damages because of ‘bodily injury’ or ‘property damage’
(caused by an occurrence) to which this insurance
applies. . . . (The insurance company has) the right and
duty to defend any ‘suit’ seeking those damages”). Non-
cumulation provisions are also common, and are debated
in litigation. See Randy Paar, Recovery is in the Details:
Hot Issues in the Administration and Application of
General Liability Insurance Policies, 86 PLI/NY 199,
224 (2000); Scott M. Seaman & Charlene Kittredge, Excess
Liability Insurance: Law and Litigation, 32 Tort & Ins.
L.J. 653, 687-89 (1997). How these provisions are inter-
preted in the context of long-tailed exposure claims under
Wisconsin law will significantly shape the future of
insurance litigation in the state.
All three of the district court’s holdings hinge on ques-
tions of state law that are of vital public concern and are
likely to recur in other cases. We can find no Wisconsin
cases addressing the specific questions raised, and resolu-
tion of these questions will control the outcome of this
appeal. To our knowledge, the Wisconsin Supreme Court
has not had the opportunity to “illuminate a clear path” on
these issues. Allstate Ins. Co., 285 F.3d at 639 n.18. We
thus find that the questions in this case are appropriate
for certification to the Wisconsin Supreme Court.
16 Nos. 06-4397 & 07-1041
III. CONCLUSION
We respectfully request that the Supreme Court of Wis-
consin answer the following questions of law:
1. Under Wisconsin law, what constitutes an “occur-
rence” in an insurance contract when exposure injuries
are sustained by numerous individuals at varying
geographical locations over many years?
2. Does Wisconsin Statute § 631.43(1) apply to succes-
sive insurance policies when an occurrence is ongoing
and spans multiple insurance policies, thereby prohib-
iting efforts by consecutive insurers to reduce cover-
age to the maximum of a single policy period?
3. In Wisconsin, are insurers obligated to pay “all
sums” related to the defense and/or indemnification of
an injury that triggers one insurance policy; or alterna-
tively, are insurers liable for a pro rata share of
defense costs and/or damages depending on how much
of the injury occurred during the triggered insurance
policy period?
We invite the Justices of the Wisconsin Supreme Court
to reformulate these questions, if necessary. Likewise, we
emphasize that nothing in this certification request
should be read to limit the scope of the Wisconsin Su-
preme Court’s inquiry.
The Clerk of this Court will transmit the briefs and
appendices in this case as well as a copy of this order to
the Wisconsin Supreme Court. Upon the request of the
Wisconsin Supreme Court, the Clerk will transmit all or
any part of the record as that court so desires. Further
proceedings in this Court are stayed while this matter
is considered by the Wisconsin Supreme Court.
QUESTIONS CERTIFIED.
Nos. 06-4397 & 07-1041 17
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—1-22-08