Pillsbury Delivers $55M Victory for Victaulic Company in Insurance Coverage Battle against Three AIG Companies

Jury Awards Victaulic Breach of Contract, Bad Faith and Punitive Damages

Aug 06, 2015, 13:30 ET from Pillsbury Winthrop Shaw Pittman LLP

SAN FRANCISCO, Aug. 6, 2015 /PRNewswire/ -- Pillsbury today announced that an Alameda County, Calif., jury has awarded its client, Pennsylvania-based Victaulic Company, a total of $55,333,581.14 in damages against three AIG companies. The trial in Victaulic Co. v. American Home Assurance Co. et al., RG12642929 (Alameda County Superior Court) spanned six weeks before The Honorable Judge Frank Roesch. The verdict, which includes $9,333,581.14 in compensation for breach of contract and bad faith and $46 million in punitive damages, is the largest verdict in the Superior Court of California, County of Alameda since at least 2006. Victaulic's trial attorneys were Insurance Recovery & Advisory Partners Joseph D. Jean and Colin T. Kemp and Counsel Jeffrey A. Kiburtz

The case concerns more than 10 years of commercial general liability (CGL) insurance the three AIG companies issued to Victaulic from 2001 to 2012. Victaulic is the originator and world's leading producer of mechanical pipe-joining solutions and grooved pipe-joining systems. The three AIG companies are American Home Assurance Company, National Union Fire Insurance Company and Insurance Company of the State of Pennsylvania (AIG).

The case was not the first between Victaulic and AIG about these CGL policies. In 2012, AIG first initiated litigation against Victaulic in Pennsylvania seeking to avoid coverage, but Pillsbury was able to secure a dismissal of that action. AIG, which at times was represented by five different law firms, unsuccessfully sued Victaulic again in Pennsylvania, and also demanded arbitration of the matter in New York. But AIG ultimately dismissed that demand with prejudice following an adverse ruling attained by Pillsbury. 

Leading up to trial in the California action, Pillsbury obtained multiple sanction awards against AIG for their discovery abuses. Pillsbury then delivered this latest defeat to AIG in two successive jury verdicts completed on August 5, 2015. The California jury awarded Victaulic a sweeping victory, finding: (i) AIG breached the insurance policies; (ii) those breaches were made in bad faith; (iii) Victaulic is entitled to over $9.3 million in compensatory damages and attorneys' fees; (iv) AIG acted with malice, oppression or fraud; and (v) AIG must pay Victaulic an additional $46 million in punitive damages.

Mark Van De Voorde, Esq., Victaulic's Chief Legal and Administrative Officer, commented "This matter is critically important to Victaulic. AIG was, in our view, seeking to take back years of insurance it wrote to Victaulic. We were right to put our trust in Joe Jean and the Pillsbury team. Not only are we thrilled with the jury's verdicts, but we could not be more pleased with how these matters have been handled by Pillsbury."

Lead lawyer Joseph Jean said: "We are happy to have proven to the jury not only that AIG breached their contracts, but that they did so in bad faith, and that their conduct warranted punitive damages. This decisive outcome demonstrates that significant punitive damages are attainable even in complex commercial litigation."  

About Pillsbury Winthrop Shaw Pittman LLP

Pillsbury is an international law firm that prosecutes and defends significant cases for top-tier clients, including their litigation as insurance policyholders.  Pillsbury's Insurance Recovery & Advisory practice was one of the first insurance policyholder practices in the United States – dating back to the Great San Francisco Earthquake and Fire of 1906, when the firm helped business owners recover from their insurers to rebuild the city.  We have recovered nearly $15 billion of insurance proceeds – including more than $1 billion in each of 2013 and 2014 alone – for our policyholder clients.  We regularly help them obtain broad insurance coverage to address the risks inherent in business today.  Pillsbury's leading policyholder practice has been lauded by Chambers USA, Legal 500 and Best Lawyers in America.  For more information visit, www.pillsburylaw.com.

About Victaulic Company

Since 1919, Victaulic has been the originator and world's leading producer of mechanical pipe joining solutions. Used in the most demanding markets, Victaulic innovative piping technologies and services put people to work faster while increasing safety, ensuring reliability and maximizing efficiency. The company has 14 manufacturing facilities and 29 branches worldwide with 3,600 employees who speak 43 languages across the globe. With over 1900 global patents, Victaulic solutions are at work in more than 140 countries across diverse business lines including oil and gas, chemical, mining, power generation, water and wastewater treatment, military and marine, as well as commercial building and fire protection. For more information visit, www.victaulic.com.

SOURCE Pillsbury Winthrop Shaw Pittman LLP