Arch Specialty Can't Dodge Construction Defect Suit

Law360, New York (April 25, 2012, 4:16 PM EDT) -- Arch Specialty Insurance Co. must face allegations that it wrongly denied coverage for a California homebuilder and its vinyl flooring subcontractor facing construction defect claims, a federal judge ruled Monday.

U.S. District Judge Dana M. Sabraw denied Arch’s motion for summary judgment in McMillin Construction Services LP’s coverage suit. The insurer issued two policies to Builders Showcase Interiors Inc., which performed home construction subcontractor work for McMillin, according to the complaint.

The insurer said in its Feb. 3 motion that BSI’s policies did not cover McMillan,...
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