Pollution Coverage

A Texas federal court applied an absolute pollution exclusion (“Total Pollution Exclusion Endorsement”) in a Commercial General Liability Policy to bar defense coverage for a Louisiana third-party pollution claim rejecting the argument that the exclusion did not apply because it did not specifically exclude a defense for the storage, transportation and handling of contaminants.  The court found that the exclusion was reasonably broad enough to make clear it excluded the claim.  It also rejected the policyholder’s argument that an endorsement regarding damage to underground mineral reserves superseded the exclusion, holding that the two clauses must be read in conjunction with one another and the exclusion clearly applied. Liberty Mutual v. Linn Energy Civil Action No. H-12-1886, U.S.D.C., So. Dist. TX.

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