Strict Interpretation Of Batch Clause Upheld In Product Liability Case

In Allianz Ins. Co., et al. v. Guidant Corp., et al., ___ N.E.2d ___, 2008 WL 5412846 (Ill. App. Ct. Dec. 29, 2008), the Illinois Appellate Court upheld partial summary judgment in favor of the insurers that the policyholder could not aggregate multiple products liability claims under the policy's batch clause.

In Allianz, the policyholder sought coverage from its various excess insurers for bodily injury claims arising out of an implantable graft manufactured by the policyholder. The claims were made in multiple policy periods. The policyholder attempted to exhaust its retention in the first policy period by aggregating all of the claims made in later years under the batch clause. The insurers filed a motion for summary judgment, arguing that the claims could not be batched because the products did not have the same known or suspected defect or deficiency, as required by the batch clause.