Wade Clark Mulcahy LLP

The Supreme Court of Delaware recently held that an attorney’s letters sent prior to the relevant policy period did not amount to a “claim for damages” within the meaning of a claims-made liability policy. See Zurich Am. Ins. Co. v. Syngenta Crop Prot. LLC, No. 135, 2023, 2024 WL 763418 (Del. Feb. 26, 2024). In Zurich, insurer Zurich brought a declaratory judgement action against their insured, Syngenta, seeking a declaration that Zurich owed no duty to defend or indemnify in suits brought against Syngenta to recover for Parkinson’s disease allegedly caused by paraquat manufactured by Syngenta for herbicides. Zurich argued that, since the suits were based on a law firm, Korein Tillery LLC’s (“Tillery”) claims made in a letter sent to Syngenta before coverage of their claims-made policy began, Syngenta was not entitled to coverage. The letter was meant to put Syngenta on notice that Tillery had been “retained by numerous victims of Parkinson’s disease in connection with the claims they and their spouses have against Syngenta for personal injuries and related damages.” The firm told Syngenta that it expected 2,000 cases to be filed and warned of imminent litigation but did not name any of the future plaintiffs. A farmer and his wife, not represented by the firm, sued Syngenta, and twelve more actions soon followed. The twelve later actions involved Tillery.

Zurich agreed to defend Syngenta; however, Zurich filed the declaratory judgement action soon after receiving the Tillery letter, arguing they had no duty to defend the twelve state actions because the “claims” were made before the policies’ inception via the letter. The Court ultimately held that the firm’s letter fell short of the definition of “claim” which is defined to include the “assertion of a right” and demand for money. Since Zurich could not point to any request or demand for monetary relief in the letters, the letter was not a “claim for damages.” The Court further reasoned that “one cannot plausibly demand or request relief, much less monetary damages, on behalf of a client whose identity is unknowable to the person or entity upon the demand is made.” See Id. at 12.

While this opinion may be merely persuasive for Wade Clark cases, it certainly provides more guidance on when a letter could constitute a “claim” for a claims made policy.