Court Rules Class Actions Claiming Mobile Phone Health Risks Allege Bodily Injury

Class actions over the supposed health risk of mobile phones created a duty to defend under Commercial General Liability policies, the U.S. District Court for the Northern District of Texas ruled. The case is Ericsson, Inc. v. St. Paul Fire and Marine Insurance Co., 2006 WL 770424 (March 27, 2006). St. Paul failed to defend the class actions, claiming they alleged only increased future risks, and that this did not constitute covered “bodily injury” under the CGL policies. The complaints spoke of “adverse health effects,” “biological injury,” “health risk” and “biological effects” due to “cellular dysfunction.”
St. Paul also argued there were no allegations of damages. The court, applying Texas law, disagreed. Texas is one of the states that employs the “eight-corner rule,” meaning the court, when evaluating the duty to defend, should look only to the allegations of the complaint and the language of the policy. The court, after considering cell phone cases in other jurisdictions, including Illinois, Maine and the Ninth Circuit, said that allegations of effects on human cells are sufficient to constitute “bodily injury” under a CGL, barring any definition to the contrary. The court also said there were no requirements in the policy that the alleged injuries be diagnosed or have manifested themselves.
Finally, the court considered St. Paul’s argument regarding the term “damages” in the policies. This was a tricky question, because not only were the health problems apparently undiagnosed, the relief sought was that the class would be furnished with free mobile phone headsets, so they wouldn’t have to hold the phones so close. However, the court said, the relief sought by the complaints “includes but is not limited” to the headsets. The court found the word “damages” in the policy ambiguous, and not clearly excluding the awarding of headsets as covered damages, and so construed the term against the insurer.

Comments Off on Court Rules Class Actions Claiming Mobile Phone Health Risks Allege Bodily Injury

Filed under Duty to Defend

Comments are closed.