Steadfast Insurance Co. v. AES Corp.

The Virginia Supreme Court reaffirmed its previous holding that an insurance company had no obligation to defend or indemnify an energy company against a lawsuit alleging that its greenhouse gas emissions led to the destruction of an Alaskan village. Upon rehearing, the court reaffirmed its prior holding, stating that the allegations by the village were that its damages were the result of the energy company's intentional actions and not an accident or other occurrence covered by the policy.

On appeal, the Virginia Supreme Court affirmed that the insurance company had no duty to defend or indemnify the energy company. In its decision, the Supreme Court held that the relevant policies only provided coverage against claims for damages caused by an accident or occurrence, and said that the release of greenhouse gases did not qualify as either.

In February 2010, a state court denied the defendant’s motion for summary judgment and granted the insurer's cross-motion for summary judgment. The court entered a declaratory judgment that the insurer had no duty to defend AES Corporation in connection with the underlying Kivalina litigation because no "occurrence" as defined in the policies had been alleged in the underlying complaint.