PROFESSIONAL SERVICES EXCLUSION BARS COVERAGE FOR CLAIMS ARISING OUT OF A NUCLEAR POWER PLANT

In Hartford Cas. Ins. Co. v. DP Engineering, LLC, 2015 WL 1927462 (N.D.Tex. April 27, 2015), Entergy Operations operated a nuclear power plant which required them, as part of maintenance to refurbish a large component, known as a stator, by a process requiring the stator to be moved from one physical location to another location in the plant.   This process was known as the “stator project.”  DPE was an engineering company that contracted with Entergy to provide Entergy with consulting, professional, or other technical work as requested by Entergy.  DPE undertook certain work related to the stator project.  Scroggins was a DPE employee assigned by DPE to perform some of the work.  On March 31, 2013, the stator was dropped, thereby causing significant property damage and bodily injuries.  Plaintiff carriers filed a declaratory judgment action seeking a ruling of no duty to defend or duty to indemnify in two underlying lawsuits because of the professional services exclusion in their insurance policies.

The court granted the Carriers’ motions for summary judgment because the allegations in the underlying lawsuits are claims arising out of the rendering of, or failure to render, professional engineering services in accomplishing the stator project.  As stated by the court, “the conclusion to be drawn from the facts alleged in the complaints is inescapable that the plaintiffs are complaining that DPE had specialized engineering knowledge and training that it failed to use, or misused, in such a way that its conduct was a factor in the failure ….  There is no rational reading of any state lawsuit complaints other than that each theory of recovery alleged bears an incidental relationship to professional engineering services of DPE.”