National Report
Thursday, May 8th, 2003 Liability Litigation Subrogation TechnologyGeneral Telephone and Electronics Corp., now Verizon, recently lost its claim for a $381 million reimbursement for Y2K expenses when the U.S. District Court for the District of New Jersey granted a motion for summary judgment to the five insurance companies who had written policies for the telecommunication provider. In GTE Corp. v. Allendale Mutual Insurance Co., No. 99-2877 (AMW) (D. N.J. summary judgment granted March 27, 2003), the court held that claims for year 2000 remediation expenses under property insurance policies are excluded from coverage because the year 2000 problem is a design defect or inherent vice. The case is another defeat for policyholders improperly seeking property insurance coverage for year 2000 remediation expenses, according to the Alliance of American Insurers. “So far, insurers have prevailed in all of these cases,” the alliance said in a statement.
