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© COZEN O’CONNOR. ALL RIGHTS RESERVED.

by: William F. Stewart, Esq.

For years, we’ve heard that the nextbig toxic tort was right around thecorner. I suspect, however, that mostclaims professionals (and lawyers)anticipated that the newest culpabletoxic agent would be spawned fromsome advancement in technology orfrom the creation of some novelproduct. The toxins of the past -asbestos fibers, lead dust, pesticides,cleaning chemicals, carbon monox-ide, etc. - have generally been theunanticipated and unwelcome resultsof our attempts to improve the worldthrough modern chemistry. By con-trast, mold is a natural phenomenonwhich has been in our midst through-out human existence2. Although his-tory reveals that different moldsfound in grains have resulted in epi-demics (e.g. a mold-related illnessknown as “St. Anthony’s Fire” pur-portedly caused limbs to blister, rotand fall off in Middle Age Europe),mold has generally been consideredundesirable, but benign. As it turnsout, however, mold can be toxic.The objectives of this article are to:(1) provide a basic working descrip-tion of the growing phenomenon of

toxic mold claims; and (2) give prac-tical guidance on handling theseclaims.

WHAT ARE MOLD CLAIMS?

A mold is a type of fungus whichreproduces itself through spores.Mold can live and grow on almostanything given the proper amount ofmoisture and the correct temperature(40° - 100°). There are a vast varietyof mold types, and at least 100species of mold have been linked toundesired health effects. The mostcommon such effects are headache,cough, sore throat, dizziness, fatigueand other allergy-like symptoms.

Exposure to mold toxins can also bemuch more serious. Particularly,encounters with stachybotrys char-tarum (i.e., stachybotrys atra), com-monly referred to as “black mold”,can be devastating. Infant deaths,bleeding lungs, and severe neurologi-cal disorders have been associatedwith this particular strain. Signifi-cantly, it has been estimated that 5%of all homes in the United States willhave had stachybotrys at one time oranother.3 Although commercialbuilding owners and homeowners

MOLD AND YOU: AN INTRODUCTORY GUIDE TO MOLDCLAIMS FOR INSURANCE PROFESSIONALS1

NEWS ON CONTEMPORARY ISSUES

IN THIS ISSUE

1 Mold and You: An IntroductoryGuide to Mold Claims forInsurance Professionals

2 Client Letter

3 Noteworthy Cases

6 Environmental Update

8 Technology Developments

PHILADELPHIAATLANTACHARLOTTECHERRY HILLCHICAGODALLASLAS VEGASLONDONLOS ANGELESNEW YORKNEWARKSAN DIEGOSAN FRANCISCOSEATTLE WASHINGTON, DCWEST CONSHOHOCKENWILMINGTONWWW.COZEN.COM

SPRING 2002

I NSURANCE L AW O BS ER VER

SPRING 2002 COZEN O’CONNOR’S NEWSLETTER ON CONTEMPORARY INSURANCE LAW ISSUES AND RECENT COURT DECISIONS

To suggest topics or for questions, please contact Richard M. Mackowsky, Esq.or Ann Thornton Field, Esq. Co-Chairs of the Insurance Law Group. Rick canbe reached at 215-665-2064 or 800-523-2900 or [email protected]. Ann can be reached at 215-665-2752 or 800-523-2900 or at [email protected].

To obtain additional copies, permission to reprint articles, or to change mail-ing information, please contact Lori Scheetz 800-523-2900, or [email protected].

Comments in the Cozen O’Connor Insurance Law Observer are not intendedto provide legal advice. Readers should not act or rely on information in theObserver without seeking specific legal advice form Cozen O’Connor on mat-ters which concern them.

DEAR CLIENTS AND FRIENDS:

We are pleased to present you our Spring 2002 Insurance Law Observer. We hope your year is off to a good start,despite continued turmoil in the United States and worldwide.

This edition of the Observer highlights the latest developments in insurance law. We have included casenotes dis-cussing independent adjusters’ authority to bind coverage, indemnity agreements, as well as a discussion of theWashington Supreme Court’s recent controversial decision to allow coverage for punitive damage awards. Alsoincluded are updates on environmental coverage law, technology related issues and mold litigation.

We continue to see an increasing number of mold claims. Cozen O’Connor attorney Bill Stewart, who has success-fully handled numerous mold cases, has written an outstanding introduction to mold coverage claims, reprinted inthis issue of the Observer. This article provides timely information and assistance in consideration of mold-relatedissues, which often are factually and legally complex.

Of course, the greatest challenge facing the insurance industry is the terrible loss of life and property following theSeptember 11 terrorist attack. The industry has responded promptly and with compassion, and has galvanizedunprecedented resources in order to meet the needs of its insureds. Cozen O’Connor is proud to assist the industryin investigating, providing advice, and helping to resolve many of the diverse insurance claims following the hor-rific events of September 11. Our significant litigation and claims experience, particularly in the area of propertyinsurance, enables us to stand at the forefront in addressing the novel and difficult insurance issues arising from theseevents. In facing the challenges brought about by September 11, we renew our commitment always to provide youwith the highest caliber of professional legal services.

Please mark your calendars for Thursday, May 23, when our 2002 Insurance Litigation Seminar will convene inPhiladelphia. This seminar promises to be quite informative, with topics including bad faith, first-party coverageissues involving the World Trade Center, mold updates and a discussion of Pennsylvania insurance claims regula-tion. We look forward to seeing you there.

Finally, we would like to let you know of our professional affiliation with the Ottawa, Ontario law firm Perley-Robertson, which practices in the areas of insurance coverage and defense. This affiliation reflects our commitmentto even better serve our clients in Canada and our high regard for the Perley-Robertson firm.

As always, we wish you good health and success. Thank you for your steadfast support of Cozen O’Connor. Pleasefeel free to call either of us if you have any questions, comments or would like to see any particular topic or issueaddressed in future issues of the Insurance Observer. Also, if you would like our assistance in planning and con-ducting a seminar or in-house training session, we would be pleased to do so without cost to clients.

VERY TRULY YOURS,

ANN THORNTON FIELD RICHARD M. MACKOWSKYCO-CHAIR CO-CHAIRINSURANCE LITIGATION DEPARTMENT INSURANCE LITIGATION DEPARTMENT


INSURANCE LAW OBSERVER

COZEN O’CONNOR 2 | 3

South Carolina District CourtDecides Independent Adjuster DidNot Have Authority to CreateCoverage; Also Finds NoCoverage for Hurricane FloydWater Damage

In the recent case of EssexInsurance Company v. Vereen’sStores, Inc. d/b/a Vereen’s Farm andTurf Center, No. 4:00-3035-12(D.S.C. Feb. 11, 2002), CozenO’Connor attorneys successfullyobtained an order granting summaryjudgment from the United StatesDistrict Court of South Carolina.The court decided there was no cov-erage for water losses sustained dur-ing Hurricane Floyd on September16, 1999, and also that the represen-tations and statements of the inde-pendent insurance adjuster lackedauthority to create coverage. Thecourt held that the explicit policylanguage rendered any allegedreliance by the insured upon repre-sentations from the independentadjuster unreasonable, and an inde-pendent insurance adjuster is with-out the authority to alter the termsof the written agreement betweenthe insurer and the insured.The insured had contacted a localstate senator, as well as the SouthCarolina Departments ofTransportation and Insurance, in anattempt to establish a claim thatcoverage existed, because its dam-ages were sustained as a result ofthe defective construction of cul-verts/drainage by the South CarolinaDepartment of Transportation. Thepolicies at issue were the ISOStandard CP0010-10/91, and theStandard ISO Cause of Loss

CP1030-06-95. Under CP1030-06-95 B.3., the insured argued that anextension of coverage should applybecause faulty, inadequate or defec-tive design, construction, mainte-nance, etc., caused and contributedto the loss.The district court held that theexclusion for flood, surface water,waves, tides, tidal waves, etc.applied if they contributed “in anyway” with an excluded cause ofloss. Weather conditions did con-tribute to the loss, and thereforecoverage was clearly excludedunder the policy.The court further held, importantly,that alleged representations by theindependent adjuster, who wasemployed by the insurer, could not,as a matter of law, alter the writtenterms of the insurance contractbetween the parties. This holding issignificant because this allegationarises in numerous cases, yet littleauthority exists on this issue nation-wide. Recognizing the lack ofSouth Carolina caselaw on thisissue, the court held as a matter oflaw that an independent insuranceadjuster could not alter the termsand conditions of the policy.The court based its ruling in part onthe following Common PolicyConditions Language:

This policy contains all the agree-ments between you and usconcerning the insurance afforded.The first Named Insured shown inthe Declarations is authorized tomake changes in the terms of thispolicy with our consent. This poli-cy’s terms can be amended or waivedonly by endorsement issued by usand made a part of this policy.

The court construed the commonpolicy conditions section as a bar tothe verbal alteration of the termsand conditions of the policy. Thisdecision establishes some precedentin South Carolina, which hopefullywill be cited and adopted by courtsin other jurisdictions as well, on thecommon issue of independentadjusters’ authority.For a copy of this decision, pleasecontact John L. Choate in ourAtlanta Office at 404.572.2027.

U.S. Appeals Court PredictsPennsylvania Will Require HigherSpecificity in NegligenceIndemnity Agreements forContractually-Assumed Liability,and Holds Subcontract AgreementWas Insufficiently Specific

Cozen O’Connor attorneys ThomasMcKay, III, and ElizabethChambers Bailey recently obtaineda significant decision in JacobsConstructors, Inc. v. NPS EnergyServices, Inc., 264 F.3d 365 (3d Cir.2001), in which the United StatesCourt of Appeals for the ThirdCircuit predicted Pennsylvaniawould expand its express statementrequirement for negligence indemni-ty agreements to cover privateindemnity agreements for contractu-ally-assumed liabilities. This case issignificant both for litigators resolv-ing contractual disputes and also fordrafters charged with preparingvalid and enforceable contractualindemnification obligations.Under Perry v. Payne, 217 Pa. 252,66 A.553 (1907) and Ruzzi v. ButlerPetroleum Co., 527 Pa. 1, 588 A.2d1 (1991) (“the Perry-Ruzzi rule”)

NOTEWORTHY CASES


and their progeny, Pennsylvaniapermits parties to enter into privatecontracts that indemnify them fortheir own negligence. But thePerry-Ruzzi rule requires that suchan obligation be expressly stated forthat obligation to be valid; no infer-ence from words of general importcan establish it. The question inJacobs Constructors was whetherthe same high degree of specificityapplied to enforce indemnity claimsfor losses that an indemnitee hadcontractually assumed.In Jacobs Constructors, the contrac-tor on a construction project, JacobsConstructors, Inc., had contractedwith the project-owner, PennzoilProducts Company, to assumePennzoil’s liability for the death orbodily injury - arising from anycause, including Pennzoil’s solenegligence - to employees of theproject’s subcontractors, one ofwhich was NPS Energy Services,Inc. The Subcontract betweenJacobs and NPS Energy requiredNPS Energy to defend Jacobs from“all claims, liabilities demands,damages, losses, costs and expens-es, including reasonable attorneyfees, awards, fines and judgments inlaw or in equity, of every kind andnature whatsoever, arising by rea-son of personal injury, the death ofor bodily injury to persons (includ-ing employees of thesubcontractor).” The Subcontractfurther stated that it “shall beassumed” until it has been “estab-lished otherwise” that NPS Energy(and its insurer) “shall defend anylawsuit or litigation brought againstany of the indemnitees with respectto any such injury, death, loss, ordamage.

An explosion followed by fireoccurred at the project as a result ofPennzoil’s negligence, and resultedin the death and/or serious bodilyinjury of a number of NPS Energy’semployees at the project area.Pennzoil demanded that Jacobsassume liability for all the personalinjury and wrongful death damagesPennzoil owed to the affected NPSEnergy employees. Jacobs thenasked NPS Energy to defend (andindemnify) it for the personal injuryand wrongful death losses Jacobshad contractually agreed to assumefor Pennzoil.The district court held NPS Energyliable to Jacobs for defense (and,inferentially, liability) in Pennzoil’ssuit against Jacobs. The districtcourt found that the phrase “anylawsuit or litigation brought againstany of the indemnitees with respectto any such injury, death, loss ordamage” meant any type of suitrelating to a personal injury, and,accordingly, that the Subcontractindemnification provision applied tocontractual indemnity claims arisingin connection with personal injuryclaims.The Third Circuit reversed. It pre-dicted that the PennsylvaniaSupreme Court would apply thePerry-Ruzzi rule to indemnity obli-gations for contractually-assumedliabilities because: (1) indemnifyinganother party’s contractually-assumed liability to a third partyimposes an obligation regardless ofthe fault of the indemnitor; and (2)indemnifying another’s contractual-ly-assumed liabilities imposes as“unusual” and “extraordinary” aburden as does the obligation to

indemnify another’s negligence.Accordingly, the Third Circuit heldthat indemnification agreements foranother’s contractually-assumedobligations must be stated expresslyin a contract in order for it to beenforceable.The Third Circuit further held thatthe language in the Jacobs-NPSEnergy Subcontract did not meet thehigh standard of specificity requiredby the Perry-Ruzzi rule. The courtfound that the phrase “lawsuit or lit-igation brought with respect to anysuch injury, death, loss, or damage”referred only to allegations impos-ing tort liability directly on JacobsConstructors for injury, death, lossor damage. Similarly, the phrase,“all claims...arising by reason ofpersonal injury” meant tort claims.The court then concluded that thelanguage of the Subcontract, i.e.,“all claims, liabilities, duties,demands, damages, losses...arisingby reason of personal injury, thedeath of or bodily injury to persons(including employees of the subcon-tractor)”, though broad, still was notsufficiently specific to encompassindemnification of an indemnitee’scontractually-assumed liability, noteven contractually-assumed liabilitytriggered by personal injury.If you would like a copy of thedecision or further informationregarding the decision, please con-tact Thomas McKay, III in thefirm’s Cherry Hill Office at856.910.5012 or ElizabethChambers Bailey in the firm’sPhiladelphia Office at215.665.2133.

NOTEWORTHY CASES (continued)



Washington Supreme CourtAllows Coverage for PunitiveDamages Award

On November 21, 2001, in FlukeCorporation v. Hartford Accident& Indemnity Company, 145Wash.2d 137, 34 P.3d 809 (2001),the Washington Supreme Courtheld that Washington law does notprevent insurance coverage for anaward of punitive damages under ageneral liability insurance policy.The court rejected the argumentthat insurance for punitive damagesis against public policy inWashington, even where the lawimposing such damages (Californiastate law, in this case) does so onlyon the basis of egregious, mali-cious, and intentional conduct.Factual BackgroundFluke Corporation was sued inCalifornia state court by a competi-tor that alleged Fluke had mali-ciously prosecuted an earlier patentinfringement case. Fluke tenderedthe defense of the lawsuit to itscommercial general liability insur-ance carrier. The insurer agreed todefend under a reservation ofrights, stating that California lawdoes not allow insurance coveragefor intentional torts such as mali-cious prosecution, and does notallow insurance coverage for puni-tive damages.The jury in the California caseagreed with Fluke’s competitor andawarded the competitor $2 millionin compensatory damages and $4million in punitive damages. Flukethen sued the insurer in Washingtonstate court, seeking a declaration ofcoverage. The trial court ruled that

the policy covered the Californiaaward of compensatory damages,but did not cover the punitive dam-ages. Fluke appealed, and theWashington Court of Appealsreversed, holding that punitivedamages were insurable underWashington law. The SupremeCourt accepted review.Washington Supreme CourtDecisionThe Supreme Court addressed threeissues in its decision. First, thecourt rejected the insurer’s argu-ment that insurance coverage formalicious prosecution is againstpublic policy because maliciousprosecution is an intentional tort.The language of the liability policy,under Coverage B, specificallyincluded malicious prosecution as acovered offense, along with severalother intentional torts. The courtdid not believe that a general publicpolicy sentiment disfavoring insur-ance coverage for the intentionalconduct of a policyholder couldoverride the explicit grant of cover-age for such conduct found in theinsurance policy.The second issue concerned insur-ance coverage for punitive dam-ages. The court first decided thatthe policy, as written, providedcoverage for the punitive damagesawarded against Fluke in theCalifornia lawsuit. The court then rejected the insur-er’s argument that insurance cover-age for punitive damages is againstWashington public policy. Thecourt stated that the only publicpolicy concerning punitive dam-ages is that they are not approved

in Washington and should not beawarded in a civil case. The courtreasoned that this public policy didnot prevent insurance coverage forpunitive damages. Notably, thecourt seemingly ignored the fact,fully presented in the briefs, thatthe punitive damages award againstFluke was rendered by a Californiacourt under California law, whichrequires that such an award beimposed only as a result of egre-gious, malicious, and intentionalconduct and for the purpose of pun-ishment and deterrence. TheSupreme Court’s opinion missesthis point. Finally, the court addressed choiceof law, important here because thejudgment against Fluke was by aCalifornia jury based on Californialaw. California law forbids insur-ance coverage for punitive dam-ages. Despite the fact that Fluke’smalicious prosecution problemarose entirely from its activities inCalifornia, the court appliedWashington law to the insuranceissue, and held that the place ofexecution and negotiation of theinsurance contract and the head-quarters of the policyholder out-weighed the local interest of thejurisdiction in which the tort actual-ly took place. We believe that there would be nocoverage for punitive damagesawards under liability policies thatexplicitly exclude such awards, orthat define damages as beingrestricted to compensatory damagesonly. Nothing in the court’s deci-sion prevents an insurer fromexcluding punitive damages fromcoverage.


For more information regardingthis decision, please call TomJones in the firm’s Seattle Officeat 206.224.1242.

ENVIRONMENTAL UPDATE

Pennsylvania Supreme CourtAllows Regulatory EstoppelInquiry in Context of CGLPollution Exclusion

The Pennsylvania Supreme Courtrecently addressed an issue impor-tant to those involved in environ-mental coverage disputes inSunbeam Corporation v. LibertyMutual Insurance Company, 566Pa. 494, 781 A.2d 1189 (2001),rearg. denied (Dec. 5, 2001). Thequestion before the court wasinterpretation of a pollution exclu-sion contained in mostComprehensive General Liabilitypolicies issued between 1970 and1985, which barred coverage forall pollution claims unless the dis-charge of the pollution was “sud-den and accidental.” Most courtsapply and construe that phrasecorrectly, requiring a pollutionevent readily identifiable in timeand place -- one that occurs bothquickly and unexpectedly -- tosupport a finding of coverage.Incredibly, a significant minorityof courts have held that even agradual, ongoing or repeated busi-ness pollution scenario can quali-fy as “sudden and accidental.”

In pursuing coverage for non-sud-den pollution, policyholder advo-cates in Sunbeam asserted a relat-ed argument known as “regulatoryestoppel.” This remedy was cre-

ated by an aberrational NewJersey Supreme Court decision,Morton International, Inc. v.General Accident Insurance Co.,134 N.J. 1, 629 A.2d 831 (1993),cert. denied, 512 U.S. 1245(1994). Under the theory of regu-latory estoppel, even if it is under-stood that a gradual pollution dis-charge could not come within theambit of the “sudden and acciden-tal” discharge exception to thepollution exclusion, an insurercannot enforce the exclusionbecause of alleged misrepresenta-tions made by insurers and insur-ance trade organizations about thescope of the exclusion when itwas filed for regulatory approvalwith state insurance departmentsin 1970.

While the Pennsylvania SupremeCourt has done nothing but allowthe policyholders in Sunbeam theopportunity to proceed past ademurrer, the decision arguablypried ajar a door long agoslammed hard and tight againstthe notion that any court shouldapply its retrospective assessmentof the internal judgments made bya coordinate branch of govern-ment decades ago through resortto extrinsic evidence in theabsence of policy ambiguity. InSunbeam, the court permitted evi-dence of custom and trade usage,even without a showing that thepolicy was ambiguous.

The Pennsylvania Supreme Courtrecently stated that the full impactof the Sunbeam decision is notpresently clear. See Lititz MutualInsurance Company v. Steely, 785

A.2d 975 (Pa. 2001). We are fol-lowing this case for further devel-opments.

Please contact Ed Zampino in thefirm’s Newark Office at973.286.1281 for a copy of theSunbeam decision or for moreinformation on regulatory estop-pel.

Washington Supreme Court RulesOn “Occurrence” Definition andAdopts Known-Loss Defense

On January 17, 2002, theWashington State Supreme Court,in a close decision, Overton v.Consolidated Insurance Co., 38P.3d 322 (Wash. 2002), issued afavorable decision to insurersregarding the “occurrence” and“known-loss” defenses in a pollu-tion case. The court decided thatan existing contamination of theinsured’s property, known by theinsured prior to purchasing aninsurance policy, but whichresults in liability to a third partysubsequent to the purchase, is notan “occurrence” which triggerscoverage.Factual BackgroundIn 1976, the EPA took two soilsamples from Overton’s site, akathe Spokane Transformer site.Test results revealed elevated lev-els of PCB contamination in oneof the samples. WhenDepartment of Ecology regulatorsinformed Overton of the testresults, he acknowledged oil-fil-tered transformers were made onthe site, but denied using any flu-ids containing PCBs. One year




NOTEWORTHY CASES (continued)


later in 1977, SpokaneTransformer purchased a CGLpolicy from Industrial IndemnityCompany. In 1979, SpokaneTransformer purchased anotherCGL policy from ConsolidatedInsurance Company. The proper-ty on which the SpokaneTransformer facility had beenlocated eventually was purchasedby Paul and MaryAnn Gisselbergin 1981. Some years after thepurchase, they conducted theirown environmental audit of theproperty as part of a re-financingarrangement and discovered thepre-existing PCB contamination.The Gisselbergs initiated remedialmeasures to clean up the property,and sent Overton a demand letternotifying him that they wouldseek contribution from him as a“potentially liable person” underWashington’s Model ToxicsControl Act. Overton forwardedthe demand letter to Consolidatedand Industrial Indemnity.Meanwhile, the Gisselbergs filedtheir suit against Overton seekingcontribution toward clean upcosts. When Overton tendered thedefense of the action to IndustrialIndemnity and Consolidated, bothinsurers denied the tender assert-ing: (1) the claim was a knownloss; (2) previously known andexisting damage could not be acovered “occurrence,”; (3) thepollution exclusion appliedbecause release of the pollutantswas expected; and (4) applicationof the owned property exclusion.Overton filed a declaratory judg-ment action against its insurers

and asserted bad faith denial ofcoverage. The trial court grantedthe insurer’s summary judgmentmotion and dismissed all claims,ruling there was neither a covered“occurrence” under the policiesnor evidence of bad faith.Overton appealed and theWashington Court of Appealsreversed on the coverage issue,holding that there existed a factquestion as to whether a covered“occurrence” had taken place.But the court affirmed the holdingthat Consolidated and IndustrialIndemnity did not act in bad faith.Both sides appealed to theWashington Supreme Court.Washington Supreme CourtDecisionThe Supreme Court concludedthat, for purposes of the insurers’summary judgment motions,Spokane Transformer knew of thePCB contamination since at least1976. The court concluded thatSpokane Transformers’ knowl-edge predated its purchase of theCGL policies. Thus, regardless ofwhen Spokane Transformerbecame liable to the Gisselbergsfor contribution to the clean upcosts, the property damage wasnot unexpected from SpokaneTransformer’s standpoint.Therefore, the court concludedthat there was no “occurrence”triggering coverage, and alterna-tive grounds to deny coverageneed not be considered.Further, for purposes of establish-ing coverage under the “occur-rence” analysis, the proper inquirywas whether Spokane

Transformer expected the physicalinjury to be tangible propertywithout regard to ownership ofthat property. Because SpokaneTransformer knew of the PCBcontamination before purchasingthe policies, coverage was proper-ly denied on the ground that therewas no “occurrence.” In addition,coverage was properly deniedunder the known-loss principle.Spokane Transformer also arguedthat Consolidated and IndustrialIndemnity denied coverage for theGisselbergs’ suit in bad faith andin violation of Washington’sConsumer Protection Act.In this case, the insurers’ denial ofcoverage was based on a reason-able interpretation of the CGLpolicies, which cover only proper-ty damage that is unexpected fromthe standpoint of the insured. Theinsurers’ investigation revealedthat the insured knew of the PCBcontamination before buying thepolicies. Thus, the insurers’ inter-pretation and conclusion that therewas no coverage was reasonable,and there was no bad faith on thepart of the insurers.This is a very significant andfavorable “occurrence” and“known-loss” decision fromWashington’s liberal SupremeCourt. If you have questions, orwould like a copy of this decision,please contact Tom Jones in thefirm’s Seattle Office at206.224.1242.



TECHNOLOGY DEVELOPMENTS

Data Stored on Computer Disk isnot “Tangible Property” UnderBusiness Liability Policy

In State Auto Property andCasualty Insurance Company v.Midwest Computers & More, 147F.Supp. 2d 1113 (W.D. Okla.2001), the United States DistrictCourt for the Western District ofOklahoma has ruled that datastored on a computer disk or tapeis not “tangible property” under abusiness liability policy, althoughloss of use of a computer doesconstitute property damagebecause a computer is “tangibleproperty” under the policy.

The plaintiffs sued the defendant/policyholder for negligent per-formance of service work on theircomputer system, alleging thatthey lost both the use of theircomputer and also extensiveamounts of appraisal data andother business information storedon their computer system. Thepolicyholder sought defense andindemnification from its insurerfor the suit.

The business owner’s liabilitypolicy covered property damageto “tangible property” as follows:

“Property damage” means:

a. Physical injury to tangibleproperty, including all resultingloss of use of that property...; or

b. Loss of use of tangible propertythat is not physically injured.

The court adopted a dictionarydefinition of “tangible”, and held“tangible” means “capable ofbeing perceived, especially by the

sense of touch: palpable...capableof being precisely identified orrealized by the mind...capable ofbeing appraised at an actual orapproximate value.” According tothe court, data stored on a com-puter disk or tape was not tangibleproperty, because data or informa-tion did not fit this definition; datacannot be perceived, touched orheld, and has no physical sub-stance. On the other hand, thecomputer itself was tangible prop-erty and its loss of use constituted“property damage” under the poli-cy.

Finally, the court ruled that the“completed operations hazard”provision did not extend coveragein this instance because the prop-erty damage alleged (i.e., loss ofuse of computers) had occurredbefore the allegedly negligentwork was completed.

This decision is important, as pol-icyholders may seek coverageunder various types of insurancepolicies for lost computer infor-mation or electronically-storeddata.

For more information or a copy ofthis decision, please contact RickMackowsky in the firm’s Phila-delphia Office at 215.665.2064.

Internet Company’s Use ofCookies Does not ViolateConsumer Privacy

In In re DoubleClick Inc. PrivacyLitigation, 2001 WL 303744(S.D.N.Y. March 28, 2001), theUnited States District Court forthe Southern District of New Yorkrecently dismissed a class actionagainst DoubleClick Inc., ruling

that the company did not violatethree federal statutes by collectingInternet users’ personal informa-tion. The decision is the first toaddress whether an Internet com-pany’s use of “cookies,” i.e., elec-tronic files that track users’ activi-ty on the World Wide Web, vio-lates consumer privacy. UnitedStates Judge Naomi ReiceBuchwald held that there is noevidence in the legislative or judi-cial history of the federal statutesthat precludes DoubleClick fromcollecting consumer informationthrough the placement of cookies.The consolidated ruling applies to13 lawsuits filed in federal courtsacross the country since January,2000.

The class action claimants allegedthat DoubleClick, the world’slargest Internet advertiser, wassurreptitiously collecting personalinformation by placing cookies ontheir computers’ hard drives.Such information includes theusers’ names, e-mail addresses,searches performed, Web sitesvisited and other demographicdata. DoubleClick uses cookies toidentify computer users who like-ly will be candidates to respond tobanner advertisements placed onnumerous Web sites. Theclaimants maintained that the col-lection of this information violatestheir privacy rights.

In reaching its decision, the courtinterpreted the application of theFederal Electronic Privacy Act,the Wiretap Act and the ConsumerFraud and Abuse Act. JudgeBuckwald found that Congressdesigned the three federal statutesto punish destructive hacking,prevent wiretapping for criminal


or tortious purposes and securethe operations of electronic com-munication service providers.The court found no evidence thatthe three federal statutes prohibit-ed DoubleClick’s collection ofpersonal information, and grantedits motion to dismiss on thegrounds that the claimants failedto state a viable claim. The classaction claimants have filed anotice of appeal to the UnitedStates Court of Appeals for theSecond Circuit.

Issues similar to those addressedin DoubleClick arose in Crowleyv. CyberSource Corporation, etal., 166 F. Supp.2d 1263 (N.D.Cal. 2001). Located in MountainView, California, CyberSourcedevelops and provides onlinetransaction verification services.In addition to CyberSource,Amazon.com was named as adefendant in the Crowley com-plaint. Claims asserted againstCyberSource included one claimfor violations of the Wiretap Act,the same federal criminal statutethat was at issue in DoubleClick,as well as four state claims forunjust enrichment, invasion ofprivacy, negligence and fraud byconcealment. The complaint con-tended that CyberSource’s creditverification services, which areused by Amazon.com to verify itscustomers’ credit card transac-tions, violate the Wiretap Act andstate common law. The U.S.District Court recently decidedthat the defendants were not liableunder the Wiretap Act, and heldthat the defendant retailer did notintercept the communication ascontemplated by the Act.

Cozen O’Connor representsCyberSource’s insurers in this

matter. For more information, ora copy of the court’s decision inthe DoubleClick case, please con-tact Robert Hammesfahr in thefirm’s Chicago Office at312.382.3101.

RECENT DEVELOPMENTS INMOLD LITIGATIONOver the last three years, mold lit-igation has been transformed froma curious nuisance, to a legitimateproblem, to a national epidemic.The objectives of this note are to:(1) summarize the scope andnature of the problem; (2)describe our firm’s involvement inmold litigation matters; and (3)identify some of the recent devel-opments in mold litigation.

Nature of the Problem

How is it that mold, which hasbeen present throughout humanexistence, could be the source ofsuch a sudden ground-swell of lit-igation? Even the simplestanswer requires a three-partexplanation. First, medical sci-ence has evolved to the pointwhere the diagnosis of mold-relat-ed illness is now often possible.Although there is still great uncer-tainty and contentious debate onthe effects of mold, there havebeen some recent watersheddevelopments in correlating cer-tain types of bodily injury to toxicmold exposure. Second, today’sHVAC systems, tighter buildingstandards, and cellulose-ladenbuilding materials, have created ahospitable environment for certaintoxic molds. Third, there is a hys-teria - fueled by media, lawyers,public adjusters, and remediationvendors - which is sweeping thecountry.

Although it is still difficult togauge the scope of the problem,there is no doubt that the situationis now very serious. Lloyd’sInsurance Today recently reportedthat toxic mold claims in theUnited States would result in a10% increase in nationwidehomeowners’ premiums. Thereare literally thousands of first andthird-party mold claims in bothTexas and California - and everyindication suggests that the epi-demic is moving north and east.These claims are particularlyproblematic from a first-party per-spective because propertyadjusters (often with little bodilyinjury background) are now beingpresented with sick homeowners’claims. As a result, there havebeen multimillion-dollar bad faithawards in several jurisdictions.

Cozen O’Connor Role

Over the last year, CozenO’Connor has become one of thenation’s leading law firms in liti-gating mold claims. We havehandled high-profile cases inPennsylvania, New Jersey, NewYork, Texas and California.Cozen O’Connor lawyers havewritten articles for numerous pub-lications, including Best’sInsurance, Mealey’s MoldLitigation Reporter, BusinessInsurance, and DRI’s CoveredEvents. We continue to speak atboth major national events andlocal forums. Our insurance liti-gation background, early entryinto the field, and network ofqualified experts, have placed usin a strong competitive position tomaintain our role as a leadingadvocate for clients in this area.





Recent Developments

The insurance industry is vigorously pursuing a vari-ety of mold exclusions. Although most standardproperty policies have a “traditional” mold or fungusexclusion, there is reason to believe that such exclu-sionary language will be judicially limited to moldwhich is not associated with a covered event. Inother words, where mold is associated with the sup-pression of fire, a sudden water leak, windstorm, orother fortuitous event, the exclusion may be deemedinapplicable. To date, only Louisiana has approveda broad mold exclusion, although New Jersey hasexpressly authorized the use of an absolute moldexclusion by excess and surplus lines carriers.* InTexas and California, where the regulatory fight hasbeen the fiercest, the Insurance Departments haveapproved the use of a $5,000 sublimit for mold dam-age. The drafting and regulation of mold exclusionswill be an important point of interest in the upcom-ing months.

Because the science of mold is in its infancy, credi-ble regulations and standards are scarce. There havebeen two important, recent developments, however,in this area. First, the New York City Department ofHealth has updated its guidelines for mold investiga-tion and remediation. Second, California becamethe first state of the nation to put mold legislationinto effect when Governor Gray Davis signed theMold Protection Act of 2001 on October 7th of lastyear. Among other things, that Act requires theCalifornia State Department of Health to preparespecific guidelines for the assessment of mold iden-tification and remediation.

Finally, the bad faith decisions continue to comedown (both favorable and unfavorable). Althoughthe Ballard case (a Texas decision) continues toattract the most national attention, recent decisionsin other states include:

• Hatley v. Century National Ins. Co. (Ariz. Super.Nov. 2001) (wherein a $4,000,000 bad faith awardwas entered after an insurer had refused to pay$72,000 in remediation and additional living expens-es, thereby exposing a seven-year old child to moldtoxins).

• Strader v. Grange Mutual Insurance Company(Or. App. Jan. 2002) (ruling that a home owner cannot pursue a tort claim for personal injuries associated with mold exposure even if property insurer’s alleged delay in paying or remediating a property claim led to the exposure.)

Please contact Bill Stewart in the firm’s WestConshohocken Office at 610.832.8356 for moreinformation.* Many states do not require approval of exclusions containedin excess and surplus lines policies.

MOLD AND YOU: AN INTRODUCTO-RY GUIDE TO MOLD CLAIMS FORINSURANCE PROFESSIONALS(Continued from page 1)

have not historically recognized the onset of blackmold as significant property damage, recent pub-licity surrounding this subject is likely to changethat viewpoint. Indeed, the focus on mold by thescientific, consumer protection, and legal commu-nities has already resulted in a sharp increase inlitigation and insurance claims. Lawsuits havebeen instituted against general contractors, archi-tects, engineers, HVAC professionals, lessors, priorowners, and real estate agents. While the majorityof these lawsuits have been instituted in California,Texas, the Southeast, and the Great Lake States,mold litigation is now being commenced regularlyin all areas of the country.

In addition to the increase in third-party liabilitysuits, claims for first-party property coverage arerising exponentially. Public adjusters are now veryattuned to the idea that the presence of mold maybe a covered event. Indeed, a public adjuster inTexas was recently quoted by ABC News as saying“[t]he asbestos problem was enormous, and this isgoing to make that look small.”5 The merit of thatcomment is discussed immediately below; but, at aminimum, this quote suggests that public adjusters intend to be heard from on this issue.


THIRD-PARTY MOLD LIABILITY CLAIMS WILLNOT RIVAL ASBESTOS CLAIMS; BUT FIRST-PARTY MOLD CLAIMS CONSTITUTE A SUB-STANTIAL THREAT

It is now clear that mold claims constitute a formi-dable challenge to be reckoned with. There havealready been several multimillion dollar verdicts,involving both property damage and bodily injury;and over $50 million dollars was recently paid tosettle mold claims in Polk County, Florida.5 As thepress continues to publicize the newly-discovereddangers of mold, and as plaintiff lawyers mobilize,there is every reason to believe that claims andlawsuits will continue to rise.

There are, however, several aspects of mold liabili-ty lawsuits which suggest they are much different,and in some respects less dangerous, than asbestoscases.

• There are no definitive biological markers attributable to mold exposure, and therefore, it is much more difficult for claimants to establish medical causation.

• On average, mold related injuries are less severe and less permanent than asbestos expo-sure injuries.

• The existence of mold and mold-related ill-ness is often immediately apparent, and thus, fewer people are exposed to mold over short-er periods of times.

• Unlike in asbestos cases, the defendants in a mold case are usually not the manufacturers of a product that contained a harmful toxin. As a consequence, both the defendants, and the liability-producing conduct at issue, are more apt to change in mold litigation. Plaintiffs will have to prove liability on a “case by case” basis.

For those reasons, mold personal injury claims willnever approach the $65 billion figure which theinsurance industry predicts will represent the

cumulative asbestos pay-out by 2020. But, on theproperty damage side, mold claims are still amajor concern. In instances where mold infesta-tion cannot be cost-effectively eradicated (e.g.where it settles into inaccessible places), lawsuitsagainst contractors, architects, HVAC subcontrac-tors, building sellers and realtors will ensue.Moreover, given the vast number of homes andcommercial businesses which have mold, thepotential for first-party claims is staggering. Theissue of whether such claims are covered is dis-cussed immediately below.

ARE FIRST-PARTY CLAIMS COVERED?

In evaluating a first-property claim involving molddamage, there are three principal coverage defens-es to consider. First, the insured must be able toestablish that direct physical loss occurred whilethe policy was in force. The growth of mold (orcontamination of mold spores) upon covered prop-erty during the policy period meets that standard.It is worth nothing, however, that the mere discov-ery of a pre-existing condition which is causingmold, may not constitute a covered loss.6 In otherwords, depending upon the applicable policy lan-guage and controlling law, the cost to remediatethe mold itself may be covered, but the cost torepair or redesign portions of the building whichhave not been physically damaged during the poli-cy period should not be. Further, where the pre-existing defect involves an error by the builder, aproperty carrier may achieve the same result byinvoking the policy’s faulty workmanship/defec-tive design exclusion. While the cost to repair thedefect in the building would be excluded, the costto remediate the mold may be covered since “ensu-

ing loss” is generally excepted from the faulty-workmanship/defective design exclusion.

The second coverage defense which may be avail-able to a property carrier is the “mold exclusion.”Notwithstanding its name, however, the moldexclusion should not be viewed as a “silver bullet”

which will preclude coverage in all cases of molddamage. In order to determine whether a moldexclusion bars coverage, in a particular case, con-sideration must be given to the exclusion at issueand the state law of the controlling jurisdiction.

A typical mold exclusion in a property policy willprovide:

We do not pay for loss caused by contamination ordeterioration including corrosion, decay, fungus,mildew, mold, rot, rust or any quality, fault or weak-ness in covered property that causes it to damage ordestroy itself. We do cover any resulting loss causedby a “specified peril” or breakage of building glass.

On its face, this exclusion would appear to pre-clude coverage for mold-related damage. Insureds,however, have two arguments at their disposal tochallenge the application of the mold exclusion.First, they will assert that, where an insured peril(e.g. water) and an uninsured peril (mold) con-tribute to cause damage, the loss is covered. Thistype of concurrent cause analysis, sometimesreferred to as the “efficient proximate cause” test,has been adopted by courts in a majority of UnitedStates jurisdictions in one form or another.Although the majority of the decisions adoptingthe efficient proximate cause test do not involvemold claims, courts in Texas and Washington haveapplied a variation of this concept in mold damagecases.7

The other argument which will be utilized byinsureds to circumvent the application of the moldexclusion is based upon the rule of insurance con-tract construction known as “ejusdem generis.”Roughly translated, these words mean that wheredescriptive terms are grouped together, they shouldbe interpreted to show some common design orintent. Within the above-cited exclusion, the term“mold” is surrounded by types of loss that occur

naturally over a period of time. As a result,insureds will argue that the intent of the moldexclusion is to bar coverage for mold which occursgradually, and which is not associated with a fortu-itous event like water damage.

The third potential coverage defense available inconnection with mold property claims is the pollu-tion exclusion. Although many states restrict theapplication of this exclusion to industrial, environ-mental pollution, some states do not. The issue ofwhether “mold” constitutes a “pollutant”, andwhether the pollution exclusion has applicability inconnection with mold claims, is discussed in fur-ther detail in the following section.

ARE THIRD-PARTY LIABILITY CLAIMS COVERED?

As previously noted, unlike asbestos manufacturerlitigation, mold liability suits will be “nonfungi-ble” - with each claim presenting a different factu-al scenario and theory of recovery. Thus, the cov-erage issues will be as diverse as the underlyinglitigation for which coverage is sought.Nevertheless, there are certain questions which arelikely to be recurrent in mold litigation.

First, since toxic mold is an irritant and a contami-nant, it is also a “pollutant” - as defined in mostpolicies. Thus, bodily injury resulting from thedispersal of mold toxins arguably falls within thescope of the absolute pollution exclusion. Thevarious U.S. jurisdictions, however, are split on theissue of whether the absolute pollution exclusionapplies when injuries result from exposure toindoor toxic pollutants. A number of courts haveheld that the absolute pollution exclusion unam-biguously precludes coverage whether bodilyinjury results from exposure to an irritant or con-taminant - irrespective of whether the exposuretakes place indoors.8 Conversely, other courtshave concluded that, when the pollution exclusion




is considered in its complete context, an intent toexclude only industrial, environmental pollutionbecomes evident. The courts adopting this latterview have held that claims for non-environmentaltoxic torts, like carbon monoxide and lead exposure,are covered.9

Thus, insurers will have to look closely at the law ofthe particular jurisdiction at issue, and the particularallegations made against the insured, to determinethe applicability of the pollution exclusion. It isworth nothing, however, that unlike lead paint,asbestos, pesticide, and other toxins, mold was nevera “useful product”. This distinction is potentiallysignificant because counsel for insureds have tradi-tionally argued (and some courts have agreed) thatwhere a toxin is part of a product which once serveda useful or intended purpose, it cannot constitute apollutant.10 To the extent that there are cases in theapplicable jurisdiction which have relied upon thisdistinction in finding the absolute pollution exclu-sion ambiguous or otherwise inapplicable, thosedecisions can be successfully distinguished frommold exposure claims.

A second coverage issue which is likely to arise inconnection with mold liability litigation is the poten-tial applicability of the business risk exclusions(including the “your work,” “your product,” and“impaired property” exclusions). For example, if acontractor is required to pay damages becausedefects in his work led to emergence of mold, all orpart of that liability may be excluded. Additionally,it is possible that, in instances where the buildingowner (or prior owner) is sued, the “owned proper-ty” exclusion may apply.

A third type of issue likely to arise out of moldclaims involves “trigger of coverage.” To the extentthat progressive and latent bodily injury and/or prop-erty damage occurs over multiple policy years, thestate law will govern which policy or policies are

applicable. It is worth noting, however, that wherethe “property damage” in a mold case is limited todefective design, the property damage is not progres-sive (although its manifestations may be). In otherwords, an argument could be made that all or someof the property damage giving rise to the liabilityoccurred at the time of construction.

In sum, coverage in connection with mold liabilityclaims must be evaluated on a case by case basis.Given the uncertainty in this developing area of thelaw, declaratory judgment actions can be a valuabletool in resolving these issues without the risk ofexcess verdicts or “sweetheart deals.”11

HANDLING OF THIRD-PARTY LIABILITY CLAIMS

In most respects, defending a mold liability case willbe similar to defending most other toxic tort claims.Depending on the particular defendant being sued, amold case may be a products liability claim, a con-struction claim, a premises liability claim, or afraudulent conveyance claim. Therefore, each moldlawsuit must be dealt with on its own merits. Thereare, however, some factors particular to mold litiga-tion which merit consideration.

All of the crucial liability issues in a mold case willturn upon expert testimony. This fact cannot beoverstated and should not be underestimated.Industrial hygienists are necessary to establish (orcontrovert) the presence of mold in sufficient quanti-ties to cause bodily injury or property damage.Construction experts are necessary to establish (orcontrovert) a defect - and in property damage cases,such experts are necessary to determine the cost ofremediating the defect. Medical experts are neces-sary to establish (or controvert) that the plaintiff’sinjuries resulted from exposure to mold. This latterissue can be particularly difficult for the plaintiffbecause: (1) the symptoms associated with mold canbe attributable to a great array of other causes (i.e., it


is difficult to pinpoint mold as the proximate causeof the damages); (2) unlike many other toxic torts,there are no definitive biological markers whichestablish mold exposure; and (3) the neurologicaleffects of mold are still largely unknown. The bot-tom line is that mold cases are likely to comedown to a battle of the experts. Therefore,although it will be expensive, it is imperative thatthe best experts available be retained, and that vig-orous efforts are made, where appropriate, to haveplaintiff’s experts disqualified on Frye andDaubert grounds.12

Another issue which is particularly pertinent tomold litigation is the statute of limitations.Because plaintiffs often have knowledge of moldbefore they recognize its potential significance,there will be instances in which mold claims aretime-barred. Defendants have successfully hadmold cases dismissed on this basis in California,Florida, and New York.13

CAN ANYTHING BE DONE BY THE INSUR-ANCE INDUSTRY TO AVOID OR MINIMIZECARRIERS’ EXPOSURE TO MOLD CLAIMS?

What should insurers do to minimize their expo-sure to mold claims? The best long-term solutionis the incorporation of a mold exclusion (or, in thefirst-party context, the clarification and/or exten-sion of the existing mold exclusion) whichexpressly sets forth the intent of the underwriter.While non-admitted carriers may, in some states,be able to make these changes immediately andunilaterally, many carriers will need to seekapproval from state insurance commissioners.Such attempts have already met with vigorousresistance from consumer groups and trial lawyerassociations. Indeed, in a June 26, 2001, hearingbefore the Texas Commissioner of Insurance, the

Independent Insurance Agents of Texas opposedvarious proposed mold exclusions.

Another step which insurers can take to minimizemold liability is to train loss control and propertyinspectors to recognize the causes and exposuresassociated with mold. Clean filters and good ven-tilation are essential for proper indoor air quality(IAQ). Eliminating leaks, moisture problems andexcessive humidity will minimize the likelihood ofmold growth.

Lastly, in this regard, insurers should be exceed-ingly careful in handling first-party water damageclaims. The largest “mold verdicts” to date haveinvolved refusals to provide first-party coveragewhich resulted in ongoing exposure of insureds tomold, exacerbating personal injuries.14

CONCLUSION

In most circumstances, mold-related injuries andproperty damage will not have extended latencyperiods. Thus, if broad mold exclusions are addedto property and liability policies in the near future,mold claims will be effectively minimized. In theinterim, however, there are certain things theindustry can do to stem the tide. In first-partyproperty cases, carriers should: (1) verify the exis-tence of direct physical loss during the policy peri-od; (2) consider the potential application of themold exclusion, defective design exclusion andpollution exclusion; and (3) take immediate andaggressive action to encourage mold removal ininstances where it accompanies a covered waterdamage loss. In third-party cases, insurers canlook to the absolute pollution exclusion and busi-ness pursuits exclusions in certain jurisdictionsunder certain circumstances. If coverage doesexist, plaintiffs’ experts should be scrutinized onFrye and Daubert grounds, and strong experts




should be retained on behalf of the insured defen-dant. Finally, in both first-party and third-partyclaims, you should consider whether a declaratoryjudgment action is appropriate. When utilizedappropriately, this type of litigation will permit acarrier to cost-effectively ascertain its obligationsearly on, thereby eliminating much of the risk asso-ciated with bad faith, excess exposure and consentjudgments.

Footnotes1 This article was originally published in Mealey’s LitigationReport: Mold, September 2001, Vol. 1 #9.2 Radon, like mold, is a natural toxin. Thus, as in radon liti-gation, the target defendants in mold liability litigation willusually be contractors, property inspectors, sellers and realestate brokers - as opposed to product manufacturers.3 ”Mold Proven Deadly,” Raja Mishsa, Detroit Free Press,November 4, 1997.4 ”Hidden Menace,” John McKenzie of ABC News.com, June26, 2001.5 Alexander Robertson, “Microbiological ContaminationLitigation a/k/a The Mold Monster,” Mealey’s LitigationReport: Construction Defects, November 1999.6 Great Northern Insurance Co. v. Benjamin Franklin FederalSavings and Loan Ass’n., 953 F.2d 1387 (9th Cir. 1992).7 Home Insurance Co. v. McClain, No. 05-97-01479-CV,2000 WL 144115 (Tex. App. Feb. 10, 2000); Bowers v.Farmers Insurance Exchange, 991 P.2d 734 (Wash. App.2000).8 Townsends of Arkansas, Inc. v. Millers Mutual InsuranceCo., 823 F.Supp. 233 (D. Del. 1993), aff’d, 26 F.3d 123 (3dCir. 1994).9 Lefrak Organization, Inc. v. Chubb Custom Insurance Co.,942 F.Supp. 949 (S.D.N.Y. 1996).10 Haman, Inc. v. St. Paul Fire & Marine Insurance Co.,18F.Supp.2d 1306, 1308 (N.D. Ala. 1998).11 A “sweetheart” deal represents the situation where aninsured, who has been denied coverage or who is beingdefended under a reservation of rights, consents to a largejudgment against it in exchange for a covenant not to executeagainst the insured’s personal assets.12 Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S.

579 (1993); Frye v. United States, 293 F. 1013 (App. DC.1923).13 Miller v. Lakeside Village Condominium Assn., 1 Cal.App. 4th 1611, 2 Cal Rptr. 2d 796 (1991); Kolnick v.Fountainview Assn., Inc. 737 So.2d 1192 (Fla. App. 1999);Harley v. 135 East 83rd Owners Corp., 238 A.D.2d 136,655 N.Y.S.2d 507 (1st Dept. 1997).14 Sacramento Business Journal, December 18, 2000, “Mold”by Laura Elder and Neal Falgoust and Scripps Howard NewsService, , July 23, 2001.


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