Harris Teeter Supermarkets, Inc. v. Ace Am. Ins. Co.

Harris Teeter Supermarkets, Inc. v. Ace Am. Ins. Co., 2023 NCBC 68. STATE OF NORTH CAROLINA IN THE GENERAL COURT OF JUSTICE SUPERIOR COURT DIVISION FORSYTH COUNTY 22 CVS 5279 HARRIS TEETER SUPERMARKETS, INC., et al., Plaintiffs, ORDER AND OPINION ON v. DEFENDANTS’ MOTION TO DISMISS AND MOTION TO STAY ACE AMERICAN INSURANCE COMPANY, et al., Defendants. 1. THIS MATTER is before the Court on the 27 March 2023 filing of Defendants’ Motion to Dismiss for Lack of Personal Jurisdiction and Under the North Carolina Declaratory Judgment Act (the “Motion to Dismiss”), (ECF No. 135 [“Mot. Dismiss”]), and Defendants’ Motion to Stay (the “Motion to Stay”, and together with the Motion to Dismiss, the “Motions”), (ECF No. 137 [“Mot. Stay”]). 2. The Court held a hearing on the Motions on 19 July 2023 (the “Hearing”), (see ECF No. 206), and its Case Management Conference pursuant to Rule 9.3 of the North Carolina Business Court Rules (“BCR(s)”) immediately following the Hearing. 3. For the reasons set forth herein, the Court GRANTS in part and DENIES in part the Motions. Offit Kurman, P.A. by J. Alexander S. Barrett and Kurt A. Seeber, and Morgan, Lewis & Bockius, LLP by Gerald P. Konkel and Christopher M. Popecki, for Plaintiffs Harris Teeter Supermarkets, Inc., Harris Teeter, LLC, The Kroger Co., Kroger Limited Partnership I, and Kroger Limited Partnership II. Brooks, Pierce, McLendon, Humphrey & Leonard, LLP by Agustin M. Martinez, Jim W. Phillips, Jr., and Jennifer K. Van Zant, Clyde & Co US LLP by Robert M. Mangino and Susan K. Sullivan, and Holwell Shuster & Goldberg, LLP by Andrew C. Indorf, Blair E. Kaminsky, Neil R. Lieberman, Michael S. Shuster, and Daniel M. Sullivan, for Defendants ACE American Insurance Co., ACE Property and Casualty Insurance Co., and Federal Insurance Co. James, McElroy & Diehl, P.A. by Adam L. Ross, and Kennedys CMK LLP by Christopher R. Carroll, Tara E. McCormack, Christina R. Salem, and Joshua S. Wirtshafter, for Defendants Allied World National Assurance Co., Starr Surplus Lines Insurance Co., and United States Fire Insurance Co. Maynard Nexsen PC by James W. Bryan and Olivia F. Fajen, and Skarzynski Marick & Black, LLP by Karen M. Dixon, for Defendants American Guarantee and Liability Insurance Co., Steadfast Insurance Co., and Zurich American Insurance Co. Bennett Guthrie, PLLC by Joshua H. Bennett, and BatesCarey LLP by Joshua A. Boggioni, Adam H. Fleischer, and Paige M. Houin, for Defendants Aspen American Insurance Co., Great American Alliance Insurance Co., Great American Assurance Co., Great America Insurance Co., Great American Insurance Co. of New York, Great American Spirit Insurance Co., and Westport Insurance Corp. Teague Campbell Dennis & Gorham, LLP by William A. Bulfer and John M. Little, and Skarzynski Marick & Black LLP by Cheryl P. Vollweiler, for Defendant Axis Surplus Insurance Co. James, McElroy & Diehl, P.A. by Edward T. Hinson, Jr. and Jennifer M. Houti, and and Dentons US LLP by Deborah J. Campbell, Kathryn M. Guinn, M. Keith Moskowitz, and Samantha Wenger, for Defendants Columbia Casualty Co., Continental Casualty Co., and Continental Insurance Co. Poyner Spruill, LLP by J. Nicholas Ellis, Andrew H. Erteschik, and Colin R. McGrath, and Nicolaides Fink Thorpe Michaelides Sullivan, LLP by Amy J. Collins Cassidy, Stephanie M. Flowers, and Monica T. Sullivan, for Defendants Endurance American Insurance Co. and Endurance American Specialty Insurance Co. Phelps Dunbar, LLP by Thomas M. Contois, Machaella M. Reisman, and Robert D. Whitney, and Dentons US LLP by Deborah J. Campbell, Kathryn M. Guinn, M. Keith Moskowitz, and Samantha Wenger, for Defendants Indian Harbor Insurance Co. and XL Insurance America, Inc.  Cranfill Sumner LLP by Jennifer A. Welch, and Choate, Hall & Stewart, LLP by John C. Calhoun and Robert A. Kole, for Defendants Liberty Insurance Underwriters, Inc., Liberty Surplus Insurance Corp., and Ohio Casualty Insurance Co. Goldberg Segalla, LLP by David L. Brown, and Willkie Farr & Gallagher, LLP by Joseph G. Davis, John B. Goerlich, Christopher J. St. Jeanos, and Diana C. Vall-llobera, for Defendant National Union Fire Insurance Co. of Pittsburg, PA. Manning, Fulton & Skinner, P.A. by Brianne M. Glass and Michael T. Medford, and Clausen Miller, P.C. by Amy R. Paulus, for Defendant Old Republic Insurance Co. Womble Bond Dickinson (US) LLP by M. Elizabeth O’Neill, and Simpson Thacher & Bartlett, LLP by Bryce L. Friedman and Joshua C. Polster, for Defendants St. Paul Fire and Marine Insurance Co., The Travelers Indemnity Co., Travelers Property Casualty Co. of America, and United States Fidelity and Guaranty Co. Young Moore and Henderson, P.A. by Brian O. Beverly, and Ruggeri Parks Weinberg LLP by Annette P. Rolain and James P. Ruggeri, for Defendant Twin City Fire Insurance Co. HWG LLP by Amy E. Richardson and Lauren E. Snyder, and Nicolaides Fink Thorpe Michaelides Sullivan, LLP by So Young Lee, Richard H. Nicolaides, Jr., and Madison G. Satterly, for Defendant Mitsui Sumitomo Insurance Co. of America. Robinson, Judge. I. INTRODUCTION 4. This matter is primarily an insurance coverage dispute concerning whether Defendants, insurance companies that issued insurance policies to Plaintiffs, owe coverage obligations to Plaintiffs. Specifically, Plaintiffs seek a declaration from the Court that Defendants have certain duties under the policies with respect to nearly 800 underlying lawsuits brought by governmental entities, third-party payors, and individuals seeking damages related to injuries allegedly caused by Plaintiffs’ distribution and dispensing of opioid drugs. 5. At this stage, the Court is presented with preliminary questions. First, the Court must determine whether it is proper to exercise personal jurisdiction over the thirty-five foreign insurance company Defendants. In doing so, the Court is in the rare position of needing to address and apply recent United States Supreme Court precedent to the facts of this case. Next, the Court must address whether, under the North Carolina Declaratory Judgment Act, the Court should exercise its discretion to refuse to render a declaratory judgment as to the liabilities and obligations of Defendants, if any. Finally, the Court will address whether it is more appropriate to stay this action pending a final resolution of a similar, earlier-filed action initiated in the State of Ohio that involves some, but not all, of the parties to this action. II. FACTUAL AND PROCEDURAL BACKGROUND 6. The Court sets forth herein only those portions of the procedural history relevant to its determination of the Motions. 7. “The Court does not make determinations of fact on motions to dismiss under Rule 12(b)(6) of the North Carolina Rules of Civil Procedure (“Rule(s)”) but only recites those factual allegations of the Amended Complaint that are relevant and necessary to the Court’s determination of the motions to dismiss.” Gateway Mgmt. Servs. v. Carrbridge Berkshire Grp., Inc., 2018 NCBC LEXIS 45, at *9 (N.C. Super. Ct. May 9, 2018).  8. However, on the filing of a motion to dismiss for lack of personal jurisdiction, “[e]ither [side] may request that the trial court make findings regarding personal jurisdiction, but in the absence of such request, findings are not required.” Bruggeman v. Meditrust Acquisition Co., 138 N.C. App. 612, 615 (2000) (citations omitted). Neither side requests the Court do so. The Court therefore declines to make findings of fact in its later analysis of the Motion to Dismiss pursuant to Rule 12(b)(2). A. The Parties 9. Plaintiffs The Kroger Co., Kroger Limited Partnership I, and Kroger Limited Partnership II (together, the “Kroger Plaintiffs”) are Ohio corporations with their corporate headquarters in Cincinnati, Ohio. (Am. Compl. ¶¶ 10–12, ECF No. 25 [“Am. Compl.”].) The Kroger Co. owned or operated pharmacies in North Carolina beginning in the 1980s. (Am. Compl. ¶ 10.) 10. Plaintiffs Harris Teeter Supermarkets, Inc. (“HT Supermarkets”), a North Carolina corporation, and Harris Teeter, LLC (“HT LLC,” and together, “HT Plaintiffs,” and with the Kroger Plaintiffs, “Plaintiffs”), a North Carolina limited liability company, each maintain their headquarters in Matthews, North Carolina. (Am. Compl. ¶¶ 7–8.) HT LLC’s sole member is HT Supermarkets. (Aff. Taryn Mecia ¶ 14, ECF No. 180 [“Mecia Aff.”].) The HT Plaintiffs are wholly owned subsidiaries of The Kroger Co., (Am. Compl. ¶ 10), and operate more than 250 stores across eight states, including 149 stores across North Carolina, (Am. Compl. ¶ 9). 11. Defendants are 35 insurance companies that one or more of the Plaintiffs purchased insurance policies from. (Am. Compl. ¶¶ 13–48.) None of the Defendants is incorporated in North Carolina, and none maintains a principal place of business in this State. (See Am. Compl. ¶¶ 13–48.) Plaintiffs allege that Defendants maintain licenses to transact insurance business in North Carolina and that Defendants “issue[d] policies in North Carolina to commercial entities residing within North Carolina.” (Am. Compl. ¶¶ 13–48.) The Court more fully addresses herein the respective policies Defendants issued to Plaintiffs. (See infra Part II.C.) B. The Underlying Opioid Lawsuits 12. As of the filing of the Motions, the Kroger Plaintiffs were named as defendants in at least 797 lawsuits involving the increased overuse and misuse of, and overdose deaths attributed to, prescription opiates (the “Underlying Opioid Lawsuits”). (See Aff. Daniel M. Sullivan ¶¶ 5–6, Ex. B at 16–98, ECF No. 142.1 [“Sullivan Aff. (Ex(s).)”] 1 (providing a color-coded spreadsheet of the opioid lawsuits naming the Kroger Plaintiffs and their affiliates as defendants as of February 2023).) Of those 797 lawsuits, 14 were initiated in North Carolina, (Sullivan Aff. Ex. B at 56– 57), and 57 were initiated in Ohio, (Sullivan Aff. Ex. B at 58–61). At the Hearing, counsel represented that the Kroger Plaintiffs have since been named in additional lawsuits arising from similar allegations that the Kroger Plaintiffs distributed and/or dispensed prescription opiates in a wrongful manner. 13. As of the filing of the Motions, the HT Plaintiffs were named as defendants in only one of the Underlying Opioid Lawsuits, Durham County v. AmerisourceBergen 1 In this instance, Mr. Sullivan’s Affidavit and the exhibits to it may be identified by the same ECF No. Rather than citing in full at each citation to a new exhibit, the Court uses the abbreviation (“Sullivan Aff. Ex(s). [ ]–[ ] at [ ]”) for brevity. The exhibits to Mr. Sullivan’s Affidavit are located at ECF Nos. 142.1–.8. Drug Corp., et al., Case No. 1:19-op-45346-DAP (the “Durham County Bellwether”). (See Sullivan Aff. Ex. B at 57, Ex. C.) The Durham County Bellwether was initiated in the U.S. District Court for the Middle District of North Carolina. (See Aff. Christopher J. St. Jeanos Ex. F at 1 n.3, n.6, 19, ECF No. 141.1 [“St. Jeanos Aff. (Ex(s).)”].) 2 That matter has since been transferred from North Carolina to the Multi- District Litigation (“MDL”) before Federal District Court Judge Dan Aaron Polster in the Northern District of Ohio, bearing the same case caption and assigned MDL No. 2804. (St. Jeanos Aff. Ex. G.) 14. The Durham County Bellwether complaint alleges a claim for relief of public nuisance against Plaintiffs. (St. Jeanos Aff. Ex. F at 229–37.) Plaintiff Durham County alleges therein that Plaintiffs, as the natural defendants in that action, “created and maintained a public nuisance by marketing, distributing, dispensing, and selling opioids in ways that have subverted the public order, affected the health of Durham County’s community, and caused an unreasonable interference with a right common to the general public.” (St. Jeanos Aff. Ex. F at ¶ 730.) 15. The Kroger Plaintiffs were named in another bellwether action, which originated in Federal Court in Ohio, Montgomery Cty. Bd. of Cty. Comm’rs v. Cardinal Health, Inc., et al., No. 1:18-op-46326-DAP (the “Montgomery County Bellwether”). (Sullivan Aff. Ex. MM at 1 n.3.) The Montgomery County Bellwether was transferred from the U.S. District Court for the Southern District of Ohio to the MDL before 2 In this instance, Mr. St. Jeanos’s Affidavit and the exhibits to it are identified by the same ECF No. To cite the exhibits to the Affidavit, the Court uses the abbreviation (“St. Jeanos Aff. Ex(s). [ ]–[ ] at [ ]”) for brevity. The St. Jeanos Affidavit and Exhibits are located at ECF No. 141.1. Judge Polster. (See Sullivan Aff. Ex. MM at ¶ 32.) The plaintiffs in that action allege that the Kroger Plaintiffs, as the natural defendants, “funneled far more opioids into Ohio and [Montgomery] County than could have been expected to serve legitimate medical use,” but that they “did not report a single suspicious order in the County between 2007 and 2014.” (Sullivan Aff. Ex. MM at ¶ 456.) The complaint also alleges that the Kroger Plaintiffs’ policies and procedures were “particularly glaring” before 2005. (Sullivan Aff. Ex. MM at ¶ 465.) 16. The Montgomery County Bellwether complaint asserts a claim for qualified public nuisance, alleging that the Kroger Plaintiffs “created and maintained a public nuisance through their ongoing conduct of marketing, distributing, dispensing, and selling opioids . . . in a manner which caused prescriptions and sales to skyrocket in [p]laintiff’s community.” (Sullivan Aff. Ex. MM at 241–42.) 17. Several other complaints from the Underlying Opioid Lawsuits were filed in this matter for the Court’s consideration. (See St. Jeanos Aff. Exs. E, M–N; Aff. Gerald P. Konkel Exs. 8–20, ECF Nos. 181, 181.2–.4 [“Konkel Aff. (Ex(s).)”] (providing the thirteen complaints for the Underlying Opioid Lawsuits initiated in North Carolina, excluding the Durham County Bellwether).) 3 For example, the Complaint filed in Kentucky action Paintsville Hosp. Co., LLC, et al. v. Amneal Pharm., LLC, et al., No. 20-CI-00151 (Ky. Cir. Ct. June 8, 2020), contains seven claims for relief against at least 62 defendants, including the Kroger Plaintiffs. (St. Jeanos. Aff. Ex. E 3 In this instance, the exhibits to Mr. Konkel’s Affidavit may be identified by the same ECF No. Rather than citing in full at each citation to a new exhibit, the Court uses the abbreviation (“Konkel Aff. Ex(s). [ ]–[ ] at [ ]”) for brevity. The exhibits to Mr. Konkel’s Affidavit may be found at ECF Nos. 181.1–.5. [“Ky. Compl.”].) The 380-page complaint alleges that the Kroger Plaintiffs, as a national operator of over 2,268 pharmacies, “distributed prescription opioids throughout the United States” and that the “volumes of opioids distributed to and dispensed by [Kroger] pharmacies were disproportionate to non-controlled drugs and other products sold by these pharmacies[.]” (Ky. Compl. ¶¶ 267, 269.) Like the complaints in the Durham County and Montgomery County Bellwethers, the Paintsville Complaint alleges a claim for nuisance. (See Ky. Compl. ¶¶ 821–35.) 18. Numerous additional complaints filed in the Underlying Opioid Lawsuits allege that the Kroger Plaintiffs engaged in similar conduct and raise nuisance claims against them. (See, e.g., St. Jeanos Aff. Ex. M (Complaint in California action Cty. of Yuba v. AmerisourceBergen Drug Corp., et al., alleging a claim for public nuisance against the Kroger Plaintiffs and others for their alleged unlawful distribution and sale of prescription opioids), Ex. N (Complaint in New York action Painting Indus. Ins. Fund v. Purdue Pharma L.P., et al., alleging a claim for public nuisance against the Kroger Plaintiffs, among other claims, for their alleged unlawful conduct which “severely impacted public health” such that the “public nuisance is commonly referred to as a ‘crisis’ or an ‘epidemic’ ”).) C. Insurance Policies at Issue 4 19. Plaintiffs allege that Defendants issued insurance and fronting policies to them, and that those policies covered “periods when the bodily injuries alleged in the 4Numerous policies that Plaintiffs purchased from Defendants were filed by the parties in support of and in opposition to the Motions. Rather than identifying each filed policy, for brevity the Court cites to those policies which appear in the record where appropriate. [Underlying] Opioid Lawsuits potentially and/or actually took place.” (Am. Compl. ¶ 51.) For purposes of this section only, the Court recites the allegations of the Amended Complaint without restating that they are Plaintiffs’ allegations. 20. ACE American Insurance Company (“ACE American”) issued at least nine policies to the HT Plaintiffs for the period 1 May 2014 to 1 March 2023, (Am. Compl. ¶ 57; see, e.g., Sullivan Aff. Exs. II–KK (including the policies for the period 1 March 2020 to 1 March 2023)), and twenty-three policies to the Kroger Plaintiffs for the period 1 January 2003 to 1 March 2020, (Am. Compl. ¶ 58; Aff. Jay Chung Exs. 5–27, ECF Nos. 183.1–.2 [“Chung Aff. Ex(s).”]). 5 21. ACE Property and Casualty Insurance Company (“ACE P&C”) issued at least two policies to the Kroger Plaintiffs for the period 25 January 2018 to 1 March 2020. (Am. Compl. ¶ 60; Chung Aff. Exs. 28–29.) 22. Federal Insurance Company (“Federal Insurance” and, together with ACE American and ACE P&C, the “Chubb Defendants”) issued at least three policies to the HT Plaintiffs for the period 1 May 1995 to 1 May 1998, (Am. Compl. ¶ 71), and twenty-five policies to the Kroger Plaintiffs for the period 1 January 1994 to 25 January 2019, (Am. Compl. ¶ 72; Chung Aff. Exs. 30–53 (excluding the policy issued for the period 1 January 1998 to 1 January 1999)). 23. National Union Fire Insurance Company of Pittsburgh, PA (“National Union”) issued at least eleven policies to the Kroger Plaintiffs for the period 5 In this instance, the exhibits to Mr. Chung’s Affidavit may be identified by the same ECF No. Rather than citing in full at each citation to a new exhibit, the Court uses the abbreviation (“Chung Aff. Ex(s). [ ]–[ ] at [ ]”) for brevity. The exhibits to Mr. Chung’s Affidavit may be found at ECF Nos. 183.1–.16. 1 January 2000 to 25 January 2007, and 25 January 2015 to 25 January 2018. (Am. Compl. ¶ 59; Chung Aff. Exs. 54–63.) 24. Allied World National Assurance Company (“Allied World”) issued at least one policy to the HT Plaintiffs for the period 1 May 2013 to 1 May 2014, (Am. Compl. ¶ 61; see Mecia Aff. Ex. 8, ECF No. 180.8 (providing the policy for the period 1 May 2013 to 1 May 2014)), and at least two policies to the Kroger Plaintiffs for the period 25 January 2016 to 25 January 2018, (Am. Compl. ¶ 62; Chung Aff. Exs. 64– 65). 25. American Guarantee and Liability Insurance Company (“American Guarantee”) issued at least three policies to the HT Plaintiffs for the period 1 May 2008 to 1 May 2011, (Am. Compl. ¶ 63), and at least fifteen policies to the Kroger Plaintiffs for the period 1 January 2001 to 1 March 2020, (Am. Compl. ¶ 64; Chung Aff. Exs. 66–80). 26. Aspen American Insurance Company (“Aspen American”) issued at least three policies to the Kroger Plaintiffs for the period 25 January 2017 to 1 March 2020. (Am. Compl. ¶ 65; Chung Aff. Exs. 81–83.) 27. AXIS Surplus Insurance Company (“AXIS”) issued at least one policy to the Kroger Plaintiffs for the period 25 January 2016 to 25 January 2017. (Am. Compl. ¶ 66; Chung Aff. Ex. 84.) 28. Columbia Casualty Company (“Columbia Casualty”) issued at least one policy to the Kroger Plaintiffs for the period 25 January 2016 to 25 January 2017. (Am. Compl. ¶ 67; Chung Aff. Ex. 85.)  29. Continental Casualty Company (“Continental Casualty”) issued at least five policies to the Kroger Plaintiffs for the period 1 January 1995 to 1 January 2000. (Am. Compl. ¶ 68; Chung Aff. Exs. 86–89 (missing only the policy allegedly issued for the period 1 January 1998 to 1 January 1999).) 30. Continental Insurance Company (“Continental Insurance”) issued at least two policies to the Kroger Plaintiffs for the period 25 January 2018 to 1 March 2020. (Am. Compl. ¶ 69; Chung Aff. Exs. 90–91.) 31. Endurance American Specialty Insurance Company (“Endurance Specialty”) issued at least four policies to the Kroger Plaintiffs for the period 25 January 2016 to 1 March 2020. 6 (Am. Compl. ¶ 70; Chung Aff. Exs. 92–95.) 32. Great American Alliance Insurance Company issued at least six policies to the HT Plaintiffs, (Am. Compl. ¶ 73); Great American Assurance Company issued at least three policies to the HT Plaintiffs, (Am. Compl. ¶ 74); Great American Insurance Company issued at least five policies to the HT Plaintiffs, (Am. Compl. ¶ 75); and Great American Insurance Company of New York (“Great American NY”) issued at least thirteen policies to the HT Plaintiffs, (Am. Compl. ¶ 76; Mecia Aff. Ex. 6, ECF No. 180.6 (including the HT Plaintiffs’ policy for the period 1 May 2013 to 1 May 2014)), and eight to the Kroger Plaintiffs, (Am. Compl. ¶ 77; Chung Aff. Exs. 96–103). 6 One of the policies that Plaintiffs allege was issued by Endurance Specialty appears to have been issued by Endurance American Insurance Company for 25 January 2019 to 1 March 2020, bearing policy number ELD30000047103. (Chung Aff. Ex. 95.)  33. Great American Spirit Insurance Company (“Great American Spirit”) issued at least five policies to the Kroger Plaintiffs for the period 25 January 2015 to 1 March 2020. (Am. Compl. ¶ 78; Chung Aff. Exs. 104–08.) 34. Travelers Indemnity Company (“Travelers Indemnity”) issued at least four policies to the HT Plaintiffs for the period 1 June 2000 to 1 May 2004, (Am. Compl. ¶ 79), and Travelers Property Casualty Company of America (“Travelers Property”) issued at least fifteen policies to the HT Plaintiffs for the period 1 May 1995 to 1 June 2000, and 1 May 2003 to 1 May 2013, (Am. Compl. ¶ 91; Mecia Aff. Ex. 5, ECF No. 180.5 (including the policy for the period 1 May 2012 to 1 May 2013)). 35. Indian Harbor Insurance Company (“Indian Harbor”) issued at least two policies to the Kroger Plaintiffs for the period 25 January 2016 to 25 January 2018. (Am. Compl. ¶ 80; Chung Aff. Exs. 109–10.) 36. Liberty Insurance Underwriters, Inc. (“Liberty Underwriters”) issued at least nine policies to the HT Plaintiffs for the period 1 May 2004 to 1 May 2014. (Am. Compl. ¶ 81; Mecia Aff. Ex. 7, ECF No. 180.7 (including the policy for the period 1 May 2013 to 1 May 2014).) Liberty Underwriters also issued at least eight policies to the Kroger Plaintiffs for the period 25 January 2009 to 25 January 2017. (Am. Compl. ¶ 82; Chung Aff. Exs. 111–17 (missing only the policy allegedly issued for the period 25 January 2016 to 25 January 2017).) 37. Liberty Surplus Insurance Corporation (“Liberty Surplus”) issued at least three policies to the Kroger Plaintiffs for the period 25 January 2017 to 25 January 2019. (Am. Compl. ¶ 83; Chung Aff. Exs. 119–21.)  38. Ohio Casualty Insurance Company (“Ohio Casualty”) issued at least one policy to the HT Plaintiffs for the period 1 May 2007 to 1 May 2008. (Am. Compl. ¶ 84.) 39. Old Republic Insurance Company (“Old Republic”) issued at least three policies to the Kroger Plaintiffs for the period 1 January 2003 to 25 January 2006. (Am. Compl. ¶ 85; Chung Aff. Exs. 122–23 (missing only the policy allegedly issued for the period 1 January 2003 to 3 February 2004).) 40. St. Paul Fire and Marine Insurance Company (“St. Paul Fire”) issued at least four policies to the HT Plaintiffs for the period 1 May 2003 to 1 May 2007, (Am. Compl. ¶ 86), and at least four policies to the Kroger Plaintiffs for the period 1 January 2002 to 25 January 2006, (Am. Compl. ¶ 87; Chung Aff. Exs. 124–27). 41. Starr Surplus Lines Insurance Company (“Starr”) issued at least three policies to the Kroger Plaintiffs for the period 25 January 2012 to 25 January 2015. (Am. Compl. ¶ 88; Chung Aff. Exs. 128–30.) 42. Steadfast Insurance Company (“Steadfast”) issued at least three policies to the Kroger Plaintiffs for the period 25 January 2016 to 25 January 2019. (Am. Compl. ¶ 89; Chung Aff. Exs. 131–33.) 43. Mitsui Sumitomo Insurance Company of America (“Mitsui Sumitomo”) issued at least two policies to the HT Plaintiffs for the period 1 May 1994 to 1 May 1996. (Am. Compl. ¶ 90.) 44. Twin City Fire Insurance Company (“Twin City”) issued at least four policies to the HT Plaintiffs for the period 1 May 1997 to 1 June 2000, and 1 May 2013 to 1 May 2014. (Am. Compl. ¶ 92; Mecia Aff. Ex. 9, ECF No. 180.9 (including the policy for the period 1 May 2013 to 1 May 2014).) 45. United States Fidelity and Guaranty Company (“U.S. Fidelity”) issued at least three policies to the HT Plaintiffs for the period 1 June 2000 to 1 May 2003, (Am. Compl. ¶ 93), and at least one policy to the Kroger Plaintiffs for the period 1 January 2000 to 1 January 2003, (Am. Compl. ¶ 94; Chung Aff. Ex. 134). 46. United States Fire Insurance Company (“U.S. Fire”) issued at least one policy to the HT Plaintiffs for the period 1 May 1995 to 1 May 1996. (Am. Compl. ¶ 95.) 47. Westport Insurance Corporation (“Westport”) issued at least six policies to the HT Plaintiffs for the period 1 May 1996 to 1 May 2002. (Am. Compl. ¶ 96.) 48. XL Insurance America, Inc. (“XL America”) issued at least twelve policies to the HT Plaintiffs for the period 1 May 2002 to 1 May 2014, (Am. Compl. ¶ 97; Mecia Aff. Ex. 10, ECF No. 180.10 (providing the policy for the period 1 May 2013 to 1 May 2014)), and at least nine policies to the Kroger Plaintiffs for the period 25 January 2006 to 25 January 2016, (Am. Compl. ¶ 98; Chung Aff. Exs. 135–43). 49. Zurich American Insurance Company (“Zurich”) issued at least one policy to the HT Plaintiffs for the period 1 May 2004 to 1 May 2005. (Am. Compl. ¶ 99.) D. The Acuity Decision and the Ohio Insurance Action 50. On 7 September 2022, the Supreme Court of Ohio filed its opinion in Acuity v. Masters Pharm., Inc., 205 N.E.3d 460 (Ohio 2022). There, the Supreme Court of Ohio considered whether an insurer owed a duty to defend its insured in lawsuits brought by city and county governments for losses allegedly caused by the opioid epidemic. Acuity, 205 N.E.3d at 462. The trial court held, in part, that the complaints in the underlying opioid lawsuits did not seek damages because of bodily injury as the governmental entities sought damages for economic loss. Id. at 463. 51. The Supreme Court of Ohio held that governmental entities suing for alleged economic losses sustained by their citizens caused by the opioid epidemic were not seeking “damages because of bodily injury.” 7 Id. at 473 (“[T]he governments here do not seek damages because of any particular opioid-related injury sustained by a citizen.”). The majority wrote that, “[t]o hold otherwise would be to conclude that a duty to defend exists simply because a consequence of the alleged public-health crisis is bodily injury, regardless of the fact that the underlying parties do not seek damages because of any particular bodily injury sustained by a person.” Id. at 474. 52. Roughly a month later, on 12 October 2022, the Chubb Defendants initiated an action in Hamilton County, Ohio seeking declarations that they are not required to provide coverage to the Kroger Plaintiffs, as the natural defendants, for underlying 7 The Court’s analysis in Acuity draws attention to the “growing and diverging body of case law” on this issue. Acuity, 205 N.E.3d at 465. Importantly, the Court highlights the varying interpretations of the meaning of “damages because of bodily injury.” On one side there are courts which have interpreted it to invoke the insurer’s duty to defend because the governmental entities sought damages for bodily injuries to their citizens, and thus necessarily also sought to recover costs related to emergency medical treatment and additional services. Id. at 465–66 (citing Cincinnati Ins. Co. v. H.D. Smith, L.L.C., 829 F.3d 771, 775 (7th Cir. 2016); Giant Eagle, Inc. v. Am. Guar. & Liab. Ins. Co., 499 F. Supp. 3d 147 (W.D. Pa. 2020)). The Court contrasts that interpretation with the one it chooses, noting where other courts have concluded that no duty to defend existed because the governmental entities “sought to recover their own increased economic costs resulting from a public-health crisis” without tying their claims to “an individual opioid-related injury[.]” Id. at 466 (citing ACE Am. Ins. Co. v. Rite Aid Corp., 270 A.3d 239, 253–54 (Del. 2022); Westfield Natl. Ins. Co. v. Quest Pharms., Inc., 2021 U.S. Dist. LEXIS 86931, at *18 (W.D. Ky. May 6, 2021)). opioid litigation. 8 (St. Jeanos Aff. ¶ 16, Ex. J.) The Complaint in that action contains three claims for declaratory judgment, seeking a declaration that: (1) the Chubb Defendants have “no duty to defend or pay for Kroger’s defense of the Opioid Lawsuits”; (2) “under the terms, conditions, and exclusions of the Policies, Chubb has no duty to indemnify Kroger for the Opioid Lawsuits”; and (3) if the Chubb Defendants are found liable under the policies issued to The Kroger Co., they are entitled “to the proper share of equitable contribution from the [o]ther [i]nsurers, including but not limited to a declaration that Chubb is not responsible for any share of Kroger’s defense or indemnity costs attributable to periods outside the effective dates of the Chubb Policies.” (St. Jeanos Aff. Ex. J at ¶¶ 45, 48, 50.) The Chubb Defendants also named many of the Kroger Plaintiffs’ other insurers as defendants. 9 (St. Jeanos Aff. Ex. J at 1–4.) 53. On 13 October 2022, National Union did the same. 10 (St. Jeanos Aff. ¶ 17, Ex. K.) National Union’s Complaint contains two claims for declaratory judgment, seeking a decree that (1) the policies issued by it to The Kroger Co. do not create a duty to defend with regard to the Underlying Opioid Lawsuits; and (2) under the 8 That action is captioned Ace Am. Ins. Co. et al. v. The Kroger Co., et al., A 2203712 (Hamilton Cty. Ct. C.P.). (See Sullivan Aff. ¶ 23.) 9 The Chubb Defendants named four defendants which are not parties in this action: AIU Insurance Company; Lumbermens Mutual Casualty Company; XL Europe Limited; and XL Insurance Company of New York. (See St. Jeanos Aff. Ex. J.) At the Hearing, Plaintiffs’ counsel represented to the Court that: AIU Insurance Company and XL Insurance Company of New York did not issue any policies to the Kroger Plaintiffs; Lumbermens Mutual Casualty Company was in liquidation, so Plaintiffs did not add it to this action; and XL Europe Limited did not issue any general liability policies to the Kroger Plaintiffs. 10 That action is captioned Nat’l Union Fire Ins. Co. of Pittsburgh, Pa v. The Kroger Co., A 2203724, (Hamilton Cty. Ct. C.P.). (See Sullivan Aff. ¶¶ 24–25.) terms of the policies it issued to The Kroger Co., National Union has no duty to indemnify. (St. Jeanos Aff. Ex. K at ¶¶ 33–34, 37–38.) 54. On 9 February 2023, the Ohio Court consolidated the two pending actions initiated by the Chubb Defendants and National Union (the “Ohio Insurance Action”). (Sullivan Aff. ¶ 25, Ex. J.) 55. This action was initiated by Plaintiffs shortly thereafter on 8 November 2022. (See Compl., ECF No. 28.) Several Defendants thereafter filed crossclaims in the Ohio Insurance Action. 56. On 29 November 2022, American Guarantee and Steadfast jointly filed their answer to the Chubb Defendants’ Complaint, and a crossclaim for declaratory judgment. (See Sullivan Aff. ¶ 40, Ex. Y.) 57. On 5 December 2022, the Kroger Plaintiffs filed their Motion to Dismiss or Stay in the Ohio Insurance Action. (St. Jeanos Aff. Ex. L.) That matter came on for hearing on 4 April 2023 before Hon. Lisa Allen in the Court of Common Pleas of Hamilton County, Ohio. (See St. Jeanos Aff. ¶ 18; Sullivan Aff. Ex. J.) As far as the Court is aware, no order has been entered. 58. From 12 December to 15 December 2022, Allied World, Aspen American, Endurance American, Endurance Specialty, Great American Insurance, Great American NY, Great American Spirit, Old Republic, Starr, St. Paul Fire, and U.S. Fidelity filed answers and crossclaims to the Chubb Defendants’ Complaint in the Ohio Insurance Action. (Sullivan Aff. ¶¶ 33–39, Exs. R–X.) In January 2023, AXIS, Columbia Casualty, Continental Insurance, Indian Harbor, Liberty Underwriters, National Union, and XL Insurance also filed answers and crossclaims to the Chubb Defendants’ complaint. (Sullivan Aff. ¶¶ 26–32, Exs. K–Q.) 59. The Motions in this action were thereafter filed on 27 March 2023. (Mot. Dismiss; Mot. Stay.) E. The Parties’ North Carolina Contacts 1. Plaintiffs’ Business in North Carolina 60. As discussed above, the HT Plaintiffs are North Carolina corporations. On 28 January 2014, HT Supermarkets merged with Hornet Acquisition, Inc., a corporate holding company organized under the laws of North Carolina with its mailing address in Cincinnati, Ohio. (St. Jeanos Aff. Ex. B.) It is undisputed that the HT Plaintiffs became wholly owned subsidiaries of the Kroger Plaintiffs on this date. (See Defs.’ Br. Supp. Mot. Dismiss 5, ECF No. 136 [“Br. Supp. Mot. Dismiss”] (citing St. Jeanos Aff. Ex. B); Mecia Aff. ¶ 11.) The Kroger Co. has roughly 200 wholly owned subsidiaries, at least twelve of which are incorporated in North Carolina. (See St. Jeanos Aff. Ex. A at 103–09 (providing the subsidiaries of The Kroger Co. in its Annual Report for the 2021 fiscal year).) 61. According to the HT Supermarkets 2021 Annual Report, its registered agent is in Raleigh, North Carolina, and its principal office is in Matthews, North Carolina. (Sullivan Aff. Ex. NN.) Four of the corporation’s ten officers reside in North Carolina, with the remaining six residing in Ohio. (Sullivan Aff. Ex. NN.) 62. The HT Plaintiffs and their predecessor entities have operated grocery stores in North Carolina since the 1960s and pharmacies since 1993. (Mecia Aff. ¶¶ 16–17.) The HT Plaintiffs have 149 of their 257 total grocery stores in this State, with food distribution centers in Greensboro and Indian Trail, North Carolina. (Mecia Aff. ¶ 18.) 63. The HT Plaintiffs have “not maintained independent business activities in Ohio and ha[ve] never been registered to do business in Ohio.” (Mecia Aff. ¶ 22.) Furthermore, HT Supermarkets maintained “its own general liability insurance program and was issued policies providing annual primary and excess insurance” prior to its acquisition by The Kroger Co. in 2014. (Mecia Aff. ¶ 25; Mecia Aff. Exs. 5– 10, ECF Nos. 180.5–.10 (providing insurance policies that HT Supermarkets purchased from various Defendants).) 64. The Kroger Plaintiffs are Ohio corporations doing business in North Carolina. (Am. Compl. ¶¶ 10–12.) Plaintiffs allege that The Kroger Co. has “owned and operated pharmacies in North Carolina since the 1980s, employing and serving thousands of North Carolinians.” (Am. Compl. ¶ 10.) 65. The Kroger Plaintiffs are registered to do business in North Carolina and The Kroger Co. filed its most recent annual report here on 24 April 2023. (Aff. Jay Chung ¶ 8, ECF No. 183 [“Chung Aff.”].) The Kroger Plaintiffs operated grocery stores in North Carolina from 1989 to 2018, but they closed the remaining fourteen North Carolina stores in 2018, selling eight to the HT Plaintiffs. (Chung Aff. ¶¶ 10– 11.)  66. Presently, the Kroger Plaintiffs are “in the process of opening a customer fulfillment center in North Carolina, the purpose of which is to enable Kroger to deliver groceries to e-commerce customers” in this State. (Chung Aff. ¶ 13.) 2. Defendants’ North Carolina Insurance Business 67. As noted previously, none of the Defendants is incorporated in North Carolina, and none maintains its principal place of business or registered agent in this State. (See Am. Compl. ¶¶ 13–47; ECF Nos. 141.3–.21 (providing the affidavits of counsel for various Defendants, which affirm that those Defendants are not incorporated in this State, and providing the states in which they are incorporated and/or the cities where they maintain a principal place of business).) 68. It appears that Great American Spirit maintained a North Carolina Professional Risk Office at 11325 N. Community House Rd. Suite 200 in Charlotte from at least 25 January 2015 to 25 January 2020. (See Chung Aff. Exs. 104–08 (providing at Item 6 that “All other Notices . . . [t]o the Company” should be sent to that office in Charlotte).) Based on the record before the Court, Great American Spirit is the only Defendant which maintained an office in this State. 69. Plaintiffs allege that Defendants are licensed insurers in the State of North Carolina, and that they issued policies in North Carolina to commercial entities residing in this State. (Am. Compl. ¶¶ 13–47.) Furthermore, it appears that Defendants each appointed the North Carolina Commissioner of Insurance (“Commissioner”) to be their agent for purposes of service of process pursuant to N.C.G.S. §§ 58-16-30 or 58-21-100. (Konkel Aff. Ex. 21.) Doing so was a requirement for licensure pursuant to Chapter 58, Articles 16 and 21 of the North Carolina General Statutes. 70. As discussed in detail herein, Defendants issued insurance policies to The Kroger Co. and HT Supermarkets beginning as early as 1994. (See Chung Aff. Ex. 30 (providing a policy The Kroger Co. purchased from Federal Insurance for the period 1 January 1994 to 1 January 1995, which referenced associated policies with Continental Casualty).) 71. A vast majority of the policies in the record were issued when Plaintiffs were engaged in selling pharmaceuticals from their grocery store pharmacies in North Carolina. In fact, of the roughly 140 policies the Kroger Plaintiffs purchased from Defendants, only sixteen provided coverage for 2018 or the years after. (See generally Chung Aff. Exs. 5–143 (providing the insurance policies of record that the Kroger Co. purchased from Defendants).) 72. Based on the information of record, it appears that from 2013 to 2021, Defendants generated $10,464,066,455.00 in total direct premiums written in North Carolina and $10,238,904,079.00 in total direct premiums earned in North Carolina. (Konkel Aff. Ex. 22 (providing annual dollar amount totals of each Defendant’s property and casualty insurance business in this State); Chirozzi Aff. Exs. 1, 3, 5, 7, 9, 11, 13, 32–33, ECF Nos. 184, 184.1–.5 (providing the data that was ultimately combined and summarized to get the total numbers stated in this paragraph).) Further, Defendants paid a combined $5,166,729,074.00 in total dir