Case Explained: 26a0188p.06

Court: United States Court of Appeals for the Sixth Circuit Filed: 2026-07-01 The Sixth Circuit affirmed the district court’s grant of summary judgment in favor of the insured, The J.M. Smucker Company, holding that the salmonella contamination event constituted a single “occurrence” under its commercial general liability insurance policies with ACE American Insurance Company. The court applied Ohio law and a de novo standard of review to determine that the number of occurrences is governed by the cause of the damage rather than the number of individual claims. Under the policies’ definition of “occurrence” as an accident involving continuous or repeated exposure to substantially the same general harmful conditions, the court reasoned that the unintentional production of contaminated peanut butter was the sole accident from Smucker’s perspective, not the separate consumption by each claimant. Furthermore, the court applied Ohio’s “cause test,” which aggregates all injuries resulting from a single proximate cause into one occurrence, rejecting ACE’s argument that each claimant’s exposure constituted a separate occurrence. Regarding the Lot Endorsement, which sought to aggregate claims by production lot, the court found the provision ambiguous because it was susceptible to more than one reasonable interpretation regarding whether it redefined “occurrence” or merely clarified timing. Applying the rule that ambiguities in insurance contracts are construed against the insurer and in favor of the insured, the court ruled that the endorsement did not override the policy’s primary definition of occurrence. The court also rejected ACE’s argument that the endorsement was surplusage, accepting Smucker’s theory that the provision served a valid “timing function” to limit coverage to a single policy year for injuries arising from a specific lot. The practical consequence is that Smucker is required to pay only one $250,000 retained limit before ACE’s coverage obligations are triggered for the entire salmonella outbreak, rather than paying the limit for each of the 225 production lots as ACE had argued. The judgment in favor of Smucker stands, and the case proceeds on that basis with no further appeal on this issue. Do It For The Case Law is a news reporting service. Nothing in this episode constitutes legal advice.