Austin-based Reid Collins & Tsai secured a $112.3 million unanimous verdict from a jury in South Carolina Tuesday night for its client JW Aluminum.
After a five-day trial in a South Carolina district court, the jury found that a group of insurers breached their obligations under an “all-risk” policy following an incident at JWA’s manufacturing facility in Goose Creek, South Carolina. They awarded the maximum possible recovery of $32.3 million for repair and replacement costs and the full $80 million policy sublimit for business-interruption losses.
William Reid of Reid Collins said the team was out at dinner when they were told there was a verdict. They rushed to the courthouse, leaving their appetizers on the table, to hear the verdict returned in their favor. He said it was “pretty dramatic.” They returned to their dinner after.
He said the firm made sure the whole team was involved. The younger attorneys on the team had the opportunity to put witnesses on the stand.
“Everyone got to see young rising stars in action,” Reid said.
In 2020, a small splash of molten aluminum from a production line kicked off a chain of events that nearly destroyed JWA’s facility. Although no workers or first responders were injured, the incident caused tens of millions of dollars of property damage and hundreds of millions in lost profits.
JWA’s insurers argued that they were only required to pay for a small fraction of these losses under a policy endorsement that reduced coverage for “direct physical loss or harm caused by heat from molten material” from the policy limit of $250 million to just $10 million.
The District Court for the District of South Carolina granted the insurers’ motion for summary judgment on the issue, finding that the endorsement unambiguously applied. However, in March, Reid Collins won a unanimous reversal by the Fourth Circuit Court of Appeals that paved the way for JWA’s subsequent claim for over $100 million.
Reid said he explained to the jury that ACE American Insurance Company had an obligation that they refused to honor.
ACE argued that because JWA didn’t replace the equipment in two years, then they didn’t owe.
Reid said JWA’s CEO, who was in the courtroom, was “ecstatic” by the verdict.
ACE attorneys were Joseph Young and Brian Duffy of Duffy and Young and Ashley Vicere, Charles Rocco, Anna Nagel, Garion Liberti, Michael Errera, and Dawn Brehony of Foran Glennon Palandech Ponzi & Rudolf. They did not respond to a request for comment.
The Reid Collins team was William T. Reid, IV, Craig Boneau, Scott Saldaña, Dylan Jones, Julia Byrne, John Hammel Strauss and Sam Hilliard.
The case is JW Aluminum Company, v. ACE American Insurance Company, Westport Insurance Corporation, AIG Specialty Insurance Company, & General Security Indemnity Company of Arizona, 2:21-CV-01034.