Insurer Relieved of Duty to Defend, Indemnify Developer for Drywall Suit

NEWPORT NEWS, Va. - A federal judge has ruled that an insurer has no duty to defend or indemnify a developer against a lawsuit filed by a Virginia homeowner after he discovered that his residence was built with Chinese drywall. Nationwide Mutual Insurance Co. v. The Overlook LLC, No. 10-69 (E.D. Va.).

Judge Mark S. Davis of the U.S. District Court for the Eastern District of Virginia ruled May 13 that terms of a pollution exclusion in three policies sold to developer The Overlook are unambiguous and fit squarely into the underlying allegations of the state court drywall suit. The …