Certain Underwriters at Lloyd’s v. Abbott Laboratories

Italian government recalled prescription drug. Various underwriters had issued product recall insurance policies to pharmaceutical company for three-year term, but sought to rescind policies on basis that company made material misrepresentations as to potential risks created when it acquired another pharmaceutical company. After bench trial, court rejected rescission claim, finding that company did not intentionally make material misrepresentation in its application that that underwriters ratified acquired company endorsement, thus waiving any claim of rescission. Ample evidence supports trial court's findings. Court properly entered final judgment, awarding pharmaceutical company $84.5 million (the limits of its coverage), recoverable costs, and postjudgment interest. Court properly rejected Section 155 vexatious delay claim against insurer, as bona fide coverage dispute existed. (CONNORS and HOFFMAN, concurring.)