Taco Bell has requested that the Ninth Circuit Court of Appeals review a district court determination that three insurance companies are not required to provide coverage under commercial liability policies for economic loss allegedly arising from decreased patronage in the wake of a 2006 E. coli outbreak. Nat’l Union Fire Ins. Co. of Pittsburgh, PA v. Ready Pac Foods, Inc., No. 09-3220 (C.D. Cal., appeal filed May 11, 2011). The district court reportedly issued an order granting a request for certification of the economic loss claim and stayed its adjudication of other unresolved matters to allow Taco Bell to take an interlocutory appeal to the Ninth Circuit.

According to the lower court, “The lost patronage claim presents a legal issue
that is unique and distinct from the other types of loss for which Taco Bell
seeks a declaration of coverage . . . such as claims for bodily injury, claims
for damages in the form of contaminated food products, and claims for the
clean-up of contaminated restaurants.” The court also noted that appellate
resolution of the issue could “significantly advance the resolution” of an
underlying action between Taco Bell and the company that supplied the
purportedly contaminated lettuce which led to the outbreak. See Law360, May
12, 2011.

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For decades, manufacturers, distributors and retailers at every link in the food chain have come to Shook, Hardy & Bacon to partner with a legal team that understands the issues they face in today's evolving food production industry. Shook attorneys work with some of the world's largest food, beverage and agribusiness companies to establish preventative measures, conduct internal audits, develop public relations strategies, and advance tort reform initiatives.