Judge rules for insurers in more opioid cases against CVS

A Delaware trial court judge said Tuesday CVS Health Corp.’s insurers are not obligated to defend the pharmacy against 218 opioid-related cases brought by municipalities, third-party payors and medical providers.

The judge applied an earlier ruling that the lawsuits do not seek damages for covered bodily injuries or property damage.

The judge in In re: CVS Opioid Insurance Litigation said the cases at issue did not include allegations that were different from those addressed by his August 2023 decision awarding partial summary judgment to the insurers for nine lawsuits brought by counties in New York and Ohio, the city of Philadelphia, the state of Florida and the Cherokee Nation.

In that ruling, the judge found the insurers, which include units of American International Group Inc., Chubb Ltd. and Travelers Cos. Inc., had no coverage obligations because the governments sought to recover economic losses, such as increased emergency response costs and treatment for addiction and overdoses.

Woonsocket, Rhode Island-based CVS sought coverage from its insurers against thousands of lawsuits accusing it of contributing to the opioid epidemic by negligently dispensing the medications and failing to monitor prescriptions for fraud or illicit use.

The judge said in Tuesday’s ruling that property damage allegedly sustained by municipalities that required repairs to jail facilities, court systems and treatment facilities, was also an economic loss that did not trigger the insurers’ defense obligations under the pharmacy’s policies because the opioid epidemic did not directly cause it.

The judge also said insurers are not obligated to defend against lawsuits brought by medical providers and third-party payors because they do not seek to recover damages for bodily injuries.

All the cases involved allegations that are subject to the Delaware Supreme Court’s January 2022 ruling in Ace America Insurance Co. et al. v. Rite Aid Corp. et al., where a majority of justices said lawsuits brought against pharmacies by government entities in the wake of the opioid epidemic seek noncovered economic losses, the judge said.

The majority in Rite Aid ruled there was no coverage under Rite Aid’s commercial general liability policies because the governments did not identify individuals harmed by the prescription painkillers.

Representatives for the parties did not respond to requests for comment.