Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 1 of 9 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA GREAT AMERICAN INSURANCE COMPANY OF NEW YORK, LIBERTY MUTUAL INSURANCE COMPANY, NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA., NAVIGATORS INSURANCE COMPANY, NEW YORK MARINE AND GENERAL INSURANCE COMPANY, VALIANT INSURANCE COMPANY, XL SPECIALTY INSURANCE COMPANY and ZURICH AMERICAN INSURANCE COMPANY CIVIL ACTION NO. SECTION JUDGE MAGISTRATE JUDGE VERSUS BP EXPLORATION & PRODUCTION INC., BP AMERICA PRODUCTION COMPANY, BP CORPORATION NORTH AMERICA INC., BP PRODUCTS NORTH AMERICA, INC., BP AMERICA, INC., TRANSOCEAN HOLDINGS, LLC, TRANSOCEAN OFFSHORE DEEPWATER DRILLING INC., and TRANSOCEAN DEEPWATER INC. COMPLAINT FOR INTERPLEADER Without prejudice to their claim for declaratory judgment pending in Civil Action No. 2:11cv275 in the United States District Court for the Eastern District of Louisiana (on appeal in Fifth Circuit Cause Number 12-30230), Various Insurance Companies subscribing to Excess Liability Insurance Policy ARS4927 issued to Transocean, Ltd. (identified with particularity in Exhibit A and referred to collectively as the Second Excess Layer Underwriters ) file this Complaint for Interpleader regarding certain insurance proceeds. The interested claimants are Transocean Holdings, LLC, Transocean Offshore Deepwater Drilling Inc., and Transocean
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 2 of 9 Deepwater Inc. (collectively, Transocean ), BP Exploration & Production Inc., BP America Production Company, BP Corporation North America Inc., and BP America Inc. (collectively, BP ). NATURE OF THE CLAIM 1. The Second Excess Layer attaches excess of the $50 million in coverage afforded under a policy issued by Ranger Insurance Limited and the $150 million in coverage afforded under a policy issued by Certain Underwriters at Lloyd s, London and Various Insurance Companies subscribing to Excess Liability Insurance Policies ARS4926, PE0902632 and PE0902536. The limit of liability afforded under the Second Excess Layer for covered claims is, in the aggregate, $150 million. 2. The Second Excess Layer provides insurance coverage to Transocean as the named insured. Transocean has a right to coverage subject to certain terms, conditions, limitations and exclusions. 3. BP claims that it is an unrestricted additional insured under the Second Excess Layer for losses and claims in connection with the April 20, 2010 explosion and sinking of the Deepwater Horizon. The coverage afforded to BP under, among other things, the Second Excess Layer, is the subject of a separate action for declaratory relief pending in MDL No. 2179 in the United States District Court for the Eastern District of Louisiana, Civil Action No. 2:11cv275. As set forth in the declaratory judgment action, the Second Excess Layer Underwriters specifically dispute that BP is an unrestricted additional insured. 4. Transocean has submitted to the Second Excess Layer Underwriters certain amounts for reimbursement that Transocean has paid or incurred in connection with the Deepwater Horizon casualty. In addition, the Second Excess Layer Underwriters expect Transocean to continue to incur claims and expenses arising from the casualty, and to submit - 2 -
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 3 of 9 such amounts for reimbursement to the Second Excess Layer Underwriters. BP also has submitted and is expected to continue to submit claims for reimbursement for settlements of personal injury claims of Transocean crew and/or BP and Transocean subcontractor employee claims. 5. The limit of the Ranger policy has been exhausted. The aggregate of claims submitted to date by Transocean and BP exceed the underlying First Excess Layer policy. In light of these submissions and the demand for coverage by BP, the Second Excess Layer Underwriters face multiple, potentially conflicting, and competing asserted interests to proceeds that may subject the Second Excess Layer Underwriters to potential claims for reimbursement equal to or greater than the available limits of coverage. The Second Excess Layer Underwriters file this Complaint for Interpleader to ensure that payments are made to the proper persons or entities, according to Court oversight. PARTIES Stakeholders/Plaintiffs 6. The subscribers to the Second Excess Layer identified on Exhibit A are various insurance companies ( Second Excess Layer Underwriters ). The Claimants/Defendants 7. Transocean Holdings, LLC is a Delaware corporation with its principal place of business in Houston, Texas. Transocean Offshore Deepwater Drilling Inc. is a Delaware corporation with its principal place of business in Houston, Texas. Transocean Deepwater Inc. is a Delaware corporation with its principal place of business in Houston, Texas. 8. BP Exploration & Production Inc. is a Delaware corporation with its principal place of business in Houston, Texas. BP America Production Company is a Delaware corporation with its principal place of business in Houston, Texas. BP Corporation North - 3 -
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 4 of 9 America Inc. is a Delaware corporation with its principal place of business in Houston, Texas. BP America Inc. is a Delaware corporation with its principal place of business in Houston, Texas. JURISDICTION AND VENUE 9. This Complaint for Interpleader is brought according to Federal Rule of Civil Procedure 22, and this Court has admiralty and maritime jurisdiction according to 28 U.S.C. 1333. 10. In the alternative, this Complaint for Interpleader is brought according to 28 U.S.C. 1335. 11. The policy in the Second Excess Layer contains a Choice of Law/Jurisdiction clause that states that the proper and exclusive law of this insurance policy shall be Texas law. Any disputes arising under or in connection with this insurance policy shall be subject to the exclusive jurisdiction of the Texas courts. According to the Judicial Panel on Multidistrict Litigation s February 8, 2011, Order, which transferred Civil Action No. 2:11cv275 in the United States District Court for the Eastern District of Louisiana to this Court, venue is proper inasmuch as this Court currently is presiding over In Re: Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico, April 20, 2010, MDL No. 2179. 1 1 On June 17, 2011, Certain Underwriters at Lloyds, London and Various Insurance Companies filed Complaints for Interpleader related to the First Excess Layer of Transocean s insurance program. Those cases are Civil Action Nos. 11-01439 and 11-0143 in MDL 2179. On December 13, 2011, the Court entered a Stipulated Case Management Order Regarding the Insurance Actions (Rec. Doc. 4893). Transocean and BP consented to jurisdiction and venue as set forth in the stipulated order. - 4 -
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 5 of 9 FACTS 12. The underlying dispute arises out of the explosion and fire on the Deepwater Horizon on April 20, 2010, her subsequent sinking in the Gulf of Mexico, and the oil emanating from BP s well. At the time of the casualty, the Deepwater Horizon was conducting drilling activities in Mississippi Canyon Block 252 according to the drilling contract between Transocean Holdings, LLC and BP America Production Company ( the Drilling Contract ). Anadarko and MOEX were joint-venturers of BP in the project. 13. The Drilling Contract defined the obligations of Transocean and BP, and specifically identified and distinguished the liabilities that Transocean assumed and those that BP assumed. The Drilling Contract also required Transocean to name BP and others as additional insureds in its insurance policies for certain liabilities assumed by Transocean. As between Transocean and the other defendants, the Drilling Contract established the limited coverage rights of the other defendants when compared to Transocean s rights. 14. At the time of the casualty, the Second Excess Layer Underwriters severally subscribed to an excess liability insurance policy in favor of Transocean. The Second Excess Layer policy affords coverage to Transocean for the casualty subject to certain terms, conditions, limitations and exclusions. 15. Certain Underwriters at Lloyd s, London and Various Insurance Companies, including the Second Excess Layer Underwriters, filed a Complaint for Declaratory Judgment in United States District Court for the Southern District of Texas, Civil No. 4:10cv1823, requesting a judgment that by reason of the Drilling Contract between BP and Transocean and the terms and conditions of the coverage afforded, BP is not an unrestricted additional insured under the various Transocean Excess Insurance Policies with respect to claims arising out of or related to the oil emanating from the Macondo Well. As set forth above, the Judicial Panel on Multidistrict - 5 -
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 6 of 9 Litigation subsequently transferred the declaratory judgment action to MDL No. 2179 in the United States District Court for the Eastern District of Louisiana, where it currently is pending as Civil Action No. 2:11cv275. 16. After the casualty, by letter dated July 26, 2010 to Certain Underwriters at Lloyd s, London and Various Insurance Companies, including the Second Excess Layer Underwriters, BP asserted that it is an unrestricted additional insured under the various Transocean Excess Insurance Policies. In addition, BP wrote: BP also asks the Excess Insurers, in the exercise of their obligation of good faith to BP, to take reasonable steps to preserve all policy proceeds that may be answerable to this loss and that the Excess Insurers not favor the interests of any insured (including Transocean) over those of BP, inasmuch as each has colorable claims as an insured under the Excess Policies. 17. Transocean, Anadarko and MOEX each intervened in Civil Action No. 2:11cv275. Anadarko and MOEX claimed that they also are unrestricted additional insureds under the Transocean Excess Insurance Policies. However, on December 16, 2011, the Court entered an order substituting BP for Anadarko and MOEX in the coverage action (Civil Action Nos. 2:11cv275) and in the First Excess Layer s interpleader actions (Civil Action Nos. 2:11cv1439 and 2:11cv1440) (MDL 2179, Rec. Doc. 4945). Accordingly, BP, as used in this Complaint, includes Anadarko and MOEX. 18. The Second Excess Layer Underwriters dispute that BP (or Anadarko or MOEX) is an unrestricted additional insured under the Second Excess Layer. 19. Transocean also disputes that BP (or Anadarko or MOEX) is an unrestricted additional insured under the Second Excess Layer. 20. Transocean has submitted claims to the Second Excess Layer Underwriters for reimbursement of certain amounts that Transocean has paid or incurred in connection with the - 6 -
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 7 of 9 Deepwater Horizon incident, and the Second Excess Layer Underwriters are reviewing submissions from Transocean for the purpose of reimbursement of amounts consistent with the terms and conditions of the coverage. 21. Because a number of parties have alleged competing interests in the Second Excess Layer, the Second Excess Layer Underwriters are faced with a threat of multiple claims exceeding the limit of coverage. REQUEST FOR RELIEF 22. According to Federal Rule of Civil Procedure 22 and/or 28 U.S.C 1335 and 2361 and/or as otherwise provided by law, the Second Excess Layer Underwriters respectfully request that the Court: a) maintain this action; b) require the Claimants/Respondents to interplead their respective claims; c) grant approval for the Second Excess Layer Underwriters to reimburse Transocean for properly submitted, reasonable and covered claims submitted to date and in the future; d) if necessary, grant the Second Excess Layer Underwriters the right to post a bond, letter of undertaking, or other appropriate security with the Court, without any admission of liability or confession on any of the issues currently pending in MDL Civil Action No. 2:11cv275 and specifically reserving all claims asserted in that action; e) adjudicate the competing claims under the Second Excess Layer; f) return all proceeds, if any, to the Second Excess Layer Underwriters after all properly payable claims are documented and satisfied; - 7 -
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 8 of 9 g) discharge the Second Excess Layer Underwriters from any further liability in connection with the policy s proceeds; h) enter an order restraining the Claimants/Respondents or other interested parties from instituting or prosecuting any proceeding in any State or United States court against the Second Excess Layer Underwriters affecting the property, instrument or obligation involved in this interpleader; and i) make all other appropriate orders to enforce judgment in this proceeding. Accordingly, the Second Excess Layer Underwriters pray that this Court maintain this action in interpleader or, alternatively, in the nature of interpleader, and grant the relief requested as well as all other relief the Court deems necessary, equitable and just and/or as may otherwise be appropriate. - 8 -
Case 2:12-cv-01978 Document 1 Filed 07/31/12 Page 9 of 9 Respectfully submitted, this the 31st day of July, 2012. Respectfully submitted, PHELPS DUNBAR LLP BY: Richard N. Dicharry (Bar #4929) Evans Martin McLeod (Bar #24846) Kyle S. Moran (Bar #33611) 365 Canal Street Suite 2000 New Orleans, LA 70130 Telephone: 504-566-1311 Telecopier: 504-568-9130 Email: Richard.Dicharry@phelps.com Marty.McLeod@phelps.com Kyle.Moran@phelps.com Attorneys for Plaintiffs GREAT AMERICAN INSURANCE COMPANY OF NEW YORK, LIBERTY MUTUAL INSURANCE COMPANY, NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA., NAVIGATORS INSURANCE COMPANY, NEW YORK MARINE AND GENERAL INSURANCE COMPANY, VALIANT INSURANCE COMPANY, XL SPECIALTY INSURANCE COMPANY and ZURICH AMERICAN INSURANCE COMPANY - 9 -