On December 1, 2011, we summarized the Sixth Circuit’s decision in Bondex International, Inc. v. Hartford Accident and Indemnity Co.pdf dismissing an insured’s claim for $125 million in insurance. Read our previous entry to refresh on the facts of the case and the basis of the Sixth Circuit’s original opinion.
On Monday, RPM, Inc. requested a panel rehearing.pdf of the Sixth Circuit’s decision. RPM’s primary argument in its petition is that the Sixth Circuit’s interpretation of the term “company” was overbroad, not consistent with the terms of the policy, and would create “serious disruption in insurance law.” According to RPM, the Sixth Circuit placed dispositive weight on the policies’ use of “company” rather than “corporation” to determine that “company” means “an association of persons for carrying on a commercial or industrial enterprise.” RPM argues that such a definition is not consistent with dictionary definitions or with the terms of the policy when read in context. RPM seeks to have the term “company” limited to “formal business entities.” RPM asserts that the Sixth Circuit’s expansive definition would create “unintended coverage under myriad commercial policies for everything from new employees’ actions prior to being hired to unorganized ‘subsidiaries’ corporations do not even know they have.”
We’ll keep an eye on this to see if the Court takes any action on the petition.