PIEDMONT OFFICE REALTY TRUST, INC.
XL SPECIALTY INSURANCE COMPANY
Certified questions from the United States Court of Appeals for the Eleventh Circuit.
King & Spalding, Anthony P. Tatum, Bethany M. Rezek, Merritt E. McAlister, J. Andrew Pratt, Jeffrey S. Bucholtz, for appellant.
Swift, Currie, McGhee & Hiers, D. Lee Clayton; Wiley Rein, Charles C. Lemley, for appellee.
Weissman, Nowack, Curry & Wilco, Seth M. Friedman, amici curiae.
THOMPSON, Chief Justice. Hines, P. J., Benham, Hunstein, Melton, and Blackwell, JJ., and Judge Frank J. Jordan, Jr., concur. Nahmias, J., disqualified.
Thompson, Chief Justice.
Piedmont Office Realty Trust, Inc. (" Piedmont" ) purchased and maintained two insurance policies -- a primary policy issued by Liberty Surplus Insurance Company and an excess coverage policy issued by XL Specialty
Insurance Company (" XL" ). The primary policy provided coverage of up to $10 million for claims against Piedmont. The excess policy provided an additional $10 million in excess of the primary policy's coverage limits.
The excess policy provides that XL will only pay for a " loss" which Piedmont becomes " legally obligated to pay as a result of a securities claim." The policy also contains a " consent to settle" clause which reads:
No claims expenses shall be incurred or settlements made, contractual obligations assumed or liability admitted [297 Ga. 39] with respect to any claim without the insurer's written consent, which shall not be unreasonably withheld. The insurer shall not be liable for any claims expenses, settlement, assumed obligation or admission to which it has not consented.
In addition, the policy contains a " no action" clause which reads:
No action shall be taken against the insurer unless, as a condition precedent thereto, there shall have been full compliance with all of the terms of this policy, and the amount of the insureds' obligation to pay shall have been finally determined either by judgment against the insureds after actual trial, or by written agreement of the insureds, the claimant and the insurer.
Piedmont was named as a defendant in a federal securities class action suit in which the plaintiffs sought damages exceeding $150 million. Relatively early in the litigation, Piedmont moved for summary judgment. The district court denied Piedmont's motion. Thereafter, following years of discovery and litigation, Piedmont renewed its summary judgment motion. The ...