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May 21, 1980


The opinion of the court was delivered by: HANNUM


I. Case History and Factual Summary.

 On February 9, 1978, the plaintiff Transamerica Insurance Company (hereinafter "Transamerica"), filed this Complaint seeking declaratory judgment relief pursuant to 28 U.S.C. ยง 2201. The essence of the action requires a determination concerning which of the two insurance companies, Transamerica and/or the defendant Bellefonte Insurance Company (hereinafter "Bellefonte"), provided insurance coverage to the defendant Roussel Corporation (hereinafter "Roussel") with respect to suits "brought by or on behalf of persons after the expiration of Transamerica's policy period." Presently before the court are Bellefonte's Motion For Summary Judgment, Roussel's Cross-Motion For Summary Judgment and Transamerica's Cross-Motion For Partial Summary Judgment.

 The controversies that inspired this declaratory judgment action are two lawsuits; Kushnir, et al. v. Cortes, et al., in the New Jersey Superior Court for Hudson County and Denko, et al. v. Roussel Corporation, in the United States District Court for the District of Delaware. In these cases, pregnant women ingested certain drugs manufactured and distributed by Roussel which, it has been alleged, caused each woman to give birth to a deformed child. The sole issue before this Court concerns which of the two insurance companies, pursuant to the terms of their policies issued to Roussel, is under the obligation to defend and/or indemnify Roussel.

 The insurance policy issued by Transamerica extended over the period beginning August 19, 1974 and ending August 19, 1975. Bellefonte's policy period began on August 19, 1975 and ended August 19, 1976. Each of the pregnant women ingested the Roussel drug during Transamerica's policy period but gave birth to their respective children during Bellefonte's policy period. Transamerica contends that the "occurrence" giving rise to the aforementioned lawsuits happened during Bellefonte's policy period when the births were occasioned. Transamerica further contends that the extent of its coverage for "bodily injury" in no event arises because an unborn child is not yet susceptible to such "bodily injury" cognizable under the law. Bellefonte advances the opposite position and contends that the harm occurred when the Roussel drug was ingested and, consequently, when the deformities were induced which, of course, would be within Transamerica's policy period.

 II. Choice of Law.

 The parties to this action have advanced the laws of Pennsylvania, New York and New Jersey as applicable to a determination of the issue thus presented. Because the foregoing decision by the Court is consistent with the precepts of law in all of these jurisdictions, the Court views it an unnecessary function to resolve a choice of law conflict.

 III. Motion and Cross-Motions for Summary Judgment.

 The threshold question to resolve this dispute is whether the children, while in the fetal stage, may be considered "persons" capable under the law of sustaining "bodily injury." In this regard, the policies issued by Transamerica and Bellefonte are identical in their definitions of "bodily injury":

"Bodily injury" means bodily injury, sickness or disease sustained by any person which occurs during the policy period including death at any time resulting therefrom.

 Transamerica contends that a "bodily injury" can not be sustained until the birth of the person injured. According to Transamerica, regardless whether the women in the Kushnir and Denko actions ingested the Roussel drugs during its policy period, there was no "bodily injury" until the birth of the respective children which occurred during the Bellefonte policy period. Both Transamerica and Bellefonte define "occurrence" as follows:

An accident, including continuous or repeated exposures to conditions which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured.

 Transamerica reasons that if "bodily injury" could not occur to an unborn infant, then there could not be an insurable "occurrence" during the Transamerica policy period.

 In support of its contention, Transamerica asserts that the decision rendered in Roe v. Wade, 410 U.S. 113, 93 S. Ct. 705, 35 L. Ed. 2d 147 (1973), implies that an unborn fetus is not considered a "person" in the legal sense. Accordingly, since a fetus is not a "person," no bodily injury could occur to it cognizable under the policy definition. The Court does not find this argument persuasive. The decision in Roe addressed the respective interests of the state and mother and focused on the woman's right of personal privacy in the ...

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