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Texas Supreme Court Finds Coverage for Deepwater Horizon Defense Costs: Three Takeaways from Anadarko Petroleum v. Houston Casualty

Nearly nine years on, the Deepwater Horizon disaster continues to make law for policyholders and insurers—this time in a ruling from the Texas Supreme Court granting Anadarko Petroleum Corporation up to $150 million in coverage for defense expenses relating to underlying bodily injury and property damage claims arising out of the April 2010 blowout and oil spill. Anadarko’s London market underwriters relied on a “Joint Venture Provision” in their “energy package” insurance policy to argue that coverage for defense costs was limited to 25% of the policy’s $150 million limit, based on Anadarko’s 25% ownership interest in the joint venture operating the Deepwater Horizon rig. While the Joint Venture Provision includes three distinct clauses, which were all disputed in the ensuing coverage litigation, the provision that ultimately proved key to coverage contained the following language: [A]s regards any liability of [Anadarko] which is insured under this Section III and which… Continue Reading

January 2019
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