Liberty Mutual Insurance v. American Home Assurance Co.

MEMORANDUM OPINION AND ORDER

MORTON DENLOW, United States Magistrate Judge.

In a matter of first impression, this Court is tasked with determining whether Illinois law imposes a duty to settle upon one lower-tiered excess insurer to another higher-tiered excess insurer. In 2002, following a collision between a freight train and an automobile, a jury awarded three plaintiffs over $54 million against the Illinois Central Railroad Company (“Illinois Central”) and Chicago, Central & Pacific Railroad Company (“Chicago Central”). Liberty Mutual Insurance Company (“Liberty Mutual”) and American Home…