Last
week, the U.S. Judicial Panel on Multidistrict Litigation agreed to at least
one mini-MDL, consolidating the business interruption lawsuits filed against
Society Insurance Co. At the same time,
it decided against consolidation of cases against several other insurers,
saying it would be inefficient.
In
August the MDL panel ruled against centralizing all COVID-19 business
interruption lawsuits because of differences between policies and unique facts
of certain policyholders. However, the
panel requested additional briefing on mini-MDLs against five insurers. Those
five (Lloyds, Cincinnati, Hartford, Society Insurance, and Travelers) insurers
accounted for approximately 275 cases (approximately 1/3 of cases filed).
In
approving the mini-MDL against Society Insurance Company, the MDL court stated
consolidation “will serve the convenience of the parties and witnesses and
further the just and efficient conduct of this litigation.” Unlike the other insurance carrier
defendants, the panel noted that Society is a regional insurer only operating
in six states (Minnesota, Iowa, Illinois, Indiana, Wisconsin, and Tennessee). These cases were transferred to the U.S.
District Court for the North District of Illinois, in Chicago.
In
a series of separate opinions, the MDL ruled against consolidating the cases
against the other insurers involved.
Generally speaking, the insurance carriers argued that local courts were
already familiar with state law (which governs most substantive insurance law
issues), that various states and municipalities issued unique and differing
civil authority issues, that a variety of policy forms were at issue, and that
any question of damages would require individualized, fact-specific
attention.