O  T  H  E  R      D  E  C  I  S  I  O  N  S  :

General Electric Co. v. Lines, 2008 WL 2908053
(Mass. Super. July 10, 2008) (Gants, J.).

General Electric Co. (“GE”) sought coverage for more than 100 different environmental claims under policies issued between 1959 and 1967. At the time, the insurer, Electric Mutual Liability Insurance Company, Ltd., was based in Massachusetts and GE was based in New York. The policies did not contain choice of law provisions.

Massachusetts and New York insurance law differ in two ways important to resolution of this dispute. First, in Massachusetts, an insurer who asserts that the insured provided to it late notice of a claim must also prove actual prejudice resulting from the late notice. That is not true under New York law. Second, under Massachusetts law, if multiple policies cover a claim, the insured may still recover policy limits from any one of the applicable policies. Under New York law, the insured can only obtain pro rata coverage from any one insurer.

Because Massachusetts is the forum state, the court applied its choice of law rules. Massachusetts uses a “functional choice-of-law approach.” In the insurance context, “[t]he location of the insured risk will be given greater weight than any other single contact in determining the state of the applicable law.” This factor pointed to New York as the “home to the plurality of the insured risk.” The court also discussed WR Grace & Co. v. Hartford Acc. & Indem. Co., 407 Mass. 572 (1990), which emphasized the domicile of the insured in complex, multi-state coverage disputes.

The court nevertheless did not find these factors conclusive, and also analyzed the factors provided in Section 188 of the Restatement (Second) of Conflict of Laws to determine which state had the more significant relationship to the issues. The court discussed each factor and concluded that New York law would govern the dispute.

Sea Rover Fishing, Inc. v. Diodati, 2008 WL 4107371
(Mass. Super. Aug. 7, 2008) (Neel, J.).

Sea Rover Fishing is a decision of limited utility to the general business litigation bar, but is an interesting read for its discussion of tuna fishing techniques and regulation. “Purse seining” involves the use of huge nets capable of catching entire schools of tuna at once. Purse seiners using spotting planes to find schools, then surround the fish in their nets. Cape Cod Bay is historically a prime bluefin tuna fishing ground and anglers

using hand gear and smaller vessels have long sought regulations to limit purse seining there.

In 2008, the Director of the Massachusetts Division of Marine Fisheries imposed a one-year prohibition on purse seining in Cape Cod Bay. Plaintiffs sought an injunction against enforcement of the prohibition. The court rejected the plaintiffs’ interpretation of the applicable regulations and their federal preemption challenge.