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Class Action Settlement Threatens Carriers’ Subrogation Rights

Stutman Law has obtained a significant benefit for subrogated insurers in a class action lawsuit pending in the District of Minnesota captioned In re: Uponor, Inc., F1807 Plumbing Fittings Products Liability Litigation. The lawsuit concerns plumbing systems manufactured by Radiant Technology, Inc. and Uponor, Inc. (collectively, “RTI Defendants”) which contain brass fittings that are allegedly prone to premature cracking and dezincification. The proposed settlement of the class action lawsuit affects both past and future losses involving the relevant Uponor fittings.

At issue: blocking carriers from pursuing subrogation

Stutman became involved in the Uponor litigation because the proposed settlement agreement defined the settlement class (i.e. those eligible to receive payment under the terms of the settlement) in such a way that insurance carriers could have been precluded from pursuing subrogation claims for future losses. More specifically, while property owners were included within the settlement class for both past and future Uponor claims, insurers were explicitly included for past claims but excluded for future claims. Moreover, even though the class definition excluded carriers with respect to future losses, the settlement agreement purported to release all future claims of property owners and their insurers. If the Stutman Firm had not become involved, carriers would have been forced to rely on their insureds to protect and pursue their subrogation rights.

Stutman Law threatens to object to settlement

The Stutman Firm analyzed the settlement agreement, realized the inconsistencies that existed within the agreement and threatened to object to the settlement on behalf of its clients, which included Liberty Mutual and other major property and casualty companies. Stutman drafted objections to the terms of the settlement, which were sent to class counsel. The Stutman Firm was prepared to file the objections if counsel did not agree to the inclusion of unambiguous language protecting subrogated carriers’ interests.

Defense counsel forced to include language that protects subrogation claims

In order to avoid defending against Stutman’s proposed objections, class counsel and defendants’ counsel filed a joint stipulation with the Court agreeing that the following language proposed by Stutman shall be included within the Court’s final Order approving the class action settlement:

With respect to the [settlement class concerning future leak claims], the parties agree that insurance companies and entities who have legal standing to pursue claims through or in the name or right of members of the settlement class, may file claims (in their own name and without the participation of their insureds) and seek reimbursement through this settlement for claims the insurance companies pay for leaks caused by [the relevant Uponor plumbing fittings]….The parties agree, and the Court hereby orders, that the claims administrator treat claims submitted by subrogated insurance carriers and entities which have legal standing to pursue claims through or in the name or right of members of the settlement class, in the same manner as claims submitted by individual homeowners or property owners.

Carriers able to subrogate without the participation of their insureds

With the inclusion of the foregoing language in the Final Order, carriers’ subrogation rights will now be protected and carriers will be treated the same as any other claimant throughout the claims process. Furthermore, whereas carriers may originally have been forced to rely upon their insureds to submit and pursue their subrogation claims, insurers can now submit and pursue their own claims, in the carriers’ own names and without the participation of their insureds.

The addition of the language protecting carriers’ rights will unquestionably benefit the industry going forward as carriers now have well-defined, concrete rights that are detailed and described within the Court’s Final Order approving the class settlement.

For further information on the Uponor class action or Stutman’s role in changing the terms of the settlement agreement, please contact Hal Kleinman in Stutman’s Mass Tort Unit at or 215-283-1177 ext. 118.

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