No Coverage for Contractor's Drywall Remediation Losses, Judge Rules

NORFOLK, Va. - A federal judge in Virginia has awarded judgment to several insurers, determining they have no obligation to indemnify a general contractor for losses related to a Chinese drywall remediation plan that was not initiated by litigation or a resulting settlement or damages award. Builders Mutual Insurance Co. v. Dragas Management Corp., et al., No. 09-185 (E.D. Va.).

Judge Rebecca Beach Smith of the U.S. District Court for the Eastern District of Virginia ruled June 13 that even the threat of legal action that followed installation of Chinese drywall in two Virginia developments is insufficient to trigger coverage …