A lawsuit against Marsh LLC units of a Louisiana chemical manufacturing company in a dispute over coverage of a damaged cable in the Persian Gulf was filed too late, a federal appeals court ruled Monday, upholding a lower court ruling.
New Orleans-based Dynamic Industries International LLC, which has a joint venture with a Saudi Arabian company, and other Dynamic entities, charged that Marsh LLC entities had either failed to obtain adequate insurance coverage from Khobar, Saudi Arabia-based Walaa Cooperative Insurance Co. , or alternatively that Walaa had breached its policy by declining coverage for the damaged cable, according to the ruling by the 5th US Circuit Court of Appeals in New Orleans in Dynamic Industries Inc. et al. v. Walaa Cooperative Insurance Co.; Marsh & McLennan Cos. Inc. et al.
The U.S. District Court in New Orleans dismissed the case and was affirmed by a three-judge panel of the Court of Appeals.
Louisiana law requires insureds who want to sue their insurance broker to do so “within one year from the date the alleged act, omission or neglect …should have been discovered,”; the judgment says, referring to a previous judgment.
Dynamic sued Marsh after Walaa denied coverage, but Dynamic had obtained a copy of the policy from Walaa nearly 18 months earlier, and when it did so “it was also constructively advised of any deficiencies contained in the policy. Dynamic’s claims against Marsh are therefore inapposite, says the judgment.
Dynamic claims the policy contains “absolutely no indication” that coverage would be denied. “But the denial was Walaa’s choice, not Marsh’s,” the ruling said.
Marsh had no comment. Lawyers for Dynamics and Walaa did not respond to requests for comment.