Patrick Scott O'Bryant is an Associate at our Tallahassee office.

InRestaurant Recycling, LLC v. Employer Mut. Cas. Co., 922 F. 3d 414 (8th Cir. 2019), Restaurant Recycling sought a declaratory judgment that its insurer, Employer Mutual Casualty Company, was obligated to defend and indemnify Restaurant Recycling against a lawsuit filed by its customer, New Fashion Pork. Restaurant Recycling is a company that purchases fat products, such as waste cooking oil, for processing and reselling to livestock producers for blending into animal feed. Restaurant Recycling delivered a load of blended fats to New Fashion Pork, but the fat products were contaminated with lascadoil and lasalocid, substances that are unsafe for consumption in swine. New Fashion Pork's swine suffered health issues, and the company sued Restaurant Recycling for damages. Restaurant Recycling's insurer, Employer Mutual Casualty Company, successfully argued in the district court that the damage alleged by New Fashion Pork fell within the policy's total pollution exclusion. The Eighth Circuit agreed and affirmed the judgment. Restaurant Recycling acknowledged that Employer Mutual Casualty Company had no obligation to defend it in cases of property damage, which would not have occurred in whole or part but for the dispersal of pollutants, and the company recognized that lascadoil was a pollutant under the terms of the policy. Restaurant Recycling, however, attempted to argue that lasalocid was not a pollutant, and that the dispersal of the pollutants must be an intentional act. Thus, it contended that the district court decision was in error. The Eighth Circuit disagreed, reasoning that the allegations that lascadoil caused some measure of damages was sufficient to place the claim within the pollution exclusion so long as the damage was caused by "dispersal" of the pollutant, and that the ordinary meaning of dispersal is not limited to intentional acts. Thus, the policy exclusion was applicable.

Food and Beverage Law Update: July 2019

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