Travelers Casualty and Surety Co. of America remains the lone insurer holdout preventing Jeld-Wen Holdings from closing the door on the anti-trust lawsuit, first filed as such in April 2021. The companies are now embroiled in a legal battle to determine if Travelers is responsible for the final part of $40 million in Jeld-Wen’s settlement with shareholders, as determined by the June 2021 settlement. Part of the money Jeld-Wen owes was paid by three other insurers as part of the company’s directors and officers (‘D&O’) liability insurance, but Travelers has refused to pay the final $10 million, having filed a complaint for the current lawsuit in April 2021, and saying in court documents that the claim was for activity that happened before the coverage offered by Travelers began.

In response to Jeld-Wen’s Brief to Support a Motion for Summary Judgment filed on December 17, lawyers for Travelers filed an Opposition to Defendants’ Motion for Summary Judgment and Memorandum in Support of Cross-Motion for Summary Judgment last week. In the filing, Travelers is arguing four points: Legal standards; the burden of establishing the disputed claims “fall within the excess policy’s insuring agreement;” prior notice exclusion barring coverage for shareholder claims; and that “doctrines of waiver and estoppel cannot create coverage under the Travelers excess policy.”

Travelers’ lawyers argue against a summary judgment, first on legal standards, pointing out that “Summary judgment is appropriate when no genuine issue of material fact exists,” and that, “The parties do not dispute that North Carolina law applies. Accordingly, the court must determine how the Supreme Court of North Carolina would rule.” Further, they argue that, “the court may not, under the guise of construing an ambiguous term, rewrite the contract or impose liabilities on the parties not bargained for and found therein.”

From there, Travelers’ claims that Jeld-Wen Defendants “bear the burden ‘to allege and prove coverage,’” and “must therefore demonstrate that the Shareholder Claims come within the scope of the Primary Policy’s (and therefore, the Excess Policy’s) coverage grant.”

Citing specific shareholder allegations from the Steves & Sons v. Jeld-Wen lawsuit, Travelers argues that “The Shareholder Claims and Antitrust Claims … constitute a single Claim because they are for the same or Interrelated Wrongful Acts, or share as a common nexus, or are causally connected by facts, circumstances, or situations.” Referencing other, previous lawsuits, attorneys for Travelers contend that “the Antitrust and Shareholder Claims are a ‘single Claim’ because, as detailed above, they all are based on the same or causally connected facts, circumstances, and situations: Jeld-Wen’s acquisition of CraftMaster, its anticompetitive handling of supply agreements, its collusion with Masonite to monopolize the markets for interior molded doors and doorskins, and its historically uncharacteristic price hikes on doors and doorskins, resulting in revenue and profits.”

Travelers’ lawyers claim that “Even if the Jeld [sic] Defendants can somehow meet their initial burden of proving coverage, the Prior Notice exclusion still bars coverage for the Shareholder Claims. That provision excludes coverage for Loss in connection with any Claim ‘for, based upon, arising from, or in any way related to any fact, circumstance or situation that, before the inception date of this Policy, was the subject of any notice given under any other . . . similar liability policy.’” They also argue that “It is undisputed that, prior to inception of the Travelers Excess Policy on March 15, 2019, Jeld-Wen gave notice of the Antitrust Claims to the 18-19 Tower insurers,” and that “The Shareholder Claims are therefore based upon, arise from, or in any way relate to facts, circumstances, and situations for which notice was provided under the 18-19 Tower. Consequently, the Prior Notice exclusion bars coverage for the Shareholder Claims.”

Travelers is asking that Jeld-Wen’s motion for summary judgment be denied and their own cross-motion for summary judgment be granted.

Stay tuned to [DWM] magazine for more information on this case as it becomes available.

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