Welspun Pipes Inc. v. Liberty Mutual Fire Insurance Co.

Welspun filed suit against its insurer, Liberty Mutual, arguing that its unpaid mitigation costs were "necessary expenses" included in the policy's loss of business income coverage. The Eighth Circuit affirmed the district court's grant of summary judgment for Liberty Mutual. The court held that the district court did not err in limiting necessary expenses covered in Paragraph C.2. of the policy to expenses incurred to avoid or reduce a loss of business income; reading the loss of business income policy provisions together, in light of their historical roots and obvious purpose, the court agreed with the district court that "necessary expenses" in Paragraph C.2. were limited to expenses that reduce a covered business income loss; and the incremental costs Welspun incurred in shifting some Seaway production to an affiliate in India were not "necessary expenses" within the meaning of Paragraph C.2. of the policy. View "Welspun Pipes Inc. v. Liberty Mutual Fire Insurance Co." on Justia Law