Nationwide Mutual Insurance v. Overlook, LLC (785 F. Supp. 2d 502, 2011)

OPINION AND ORDER

MARK S. DAVIS, District Judge.

On January 19, 2010, Plaintiffs Nationwide Mutual Insurance Company, Nationwide Mutual Fire Insurance Company, and Nationwide Property and Casualty Insurance Company (collectively “Nationwide”) filed a Complaint in the Richmond Division of this Court, seeking a declaratory judgment that Nationwide has no duty to defend or indemnify the Defendants — The Overlook LLC, Steven A. Middleton, Vista Middleton, LLC (collectively “Overlook”) and Ricky L. Edmonds (“Edmonds”) — under several relevant insurance policies. After a transfer of the ease to this Division, and significant motions practice, there are four principal motions before this Court — Nationwide’s motion for summary judgment, Edmonds’ motion to stay Nationwide’s motion for summary judgment, Overlook’s motion for summary judgment, and Edmonds’ motion for summary judgment. Nationwide has also filed a motion for leave to file an amended complaint. For the reasons set forth below, the Court GRANTS IN PART Nationwide’s motion for summary judgment. Specifically, the Court concludes that Nationwide does not have a duty to defend Overlook in Edmonds’ underlying state lawsuit, based on the Pollution Exclusion in the applicable insurance policies. As a result, Nationwide also has no duty to indemnify Overlook with respect to Edmonds’ state suit. Consequently, the Court DENIES the motions for summary judgment filed by Overlook and Edmonds, which requested a declaratory judgment that Nationwide has a duty to defend Overlook in the underlying Edmonds lawsuit. However, given the previous discovery stay in this matter and the absence of “litigated facts” on the subject of how the damages actually occurred in the “NonEdmonds” homes, the Court HOLDS ITS DECISION IN ABEYANCE, on the subject of Nationwide’s duty to indemnify Overlook with respect to the homes for which there are no underlying lawsuits, until the parties are able to develop sufficient facts on the issue or until Nationwide advances alternative legal grounds for summary judgment that do not require significant factual discovery.

With respect to the pending motion to amend the Complaint, which asks that Nationwide be granted leave to add allegations to the Complaint regarding two other actions that Edmonds has filed — the Wiltz and Amato actions — the Court will address that motion in a separate Order.

I. Facts and Procedural History

A. Facts

This is an action regarding Nationwide’s duty to defend and indemnify its insured, real estate developer Overlook, with respect to damage caused by defective drywall imported from China and installed in homes built by Overlook. Overlook is a real estate developer that owned real property in Richmond, Virginia, where it developed a complex known as the “Overlook Townhouses.” (Compl. ¶ 15; Answer and Counterclaim ¶ 15). Between July 2, 2006 and May 30, 2008, Overlook sold at least ten of the affected units to individuals and families. However, to the Court’s knowledge, Overlook still owns several unsold units. (Compl. ¶ 16, Answer and Counterclaim ¶ 16; Colinvaux Aff. Ex. 8, at 1-3). Of the units sold, one was purchased by Edmonds, a Defendant in this action.

By 2009, Overlook became aware that defective drywall imported from China may have been installed in some of the homes it constructed — with the suspicion subsequently confirmed through further investigation. While the parties dispute the exact method by which such drywall causes damage, it is undisputed that it is problematic in a home and should be removed. Therefore, in a May 22, 2009 letter that Overlook sent the owners of its townhomes, it encouraged them to have their homes inspected at Overlook’s expense. (Colinvaux Aff. Ex. 9). Where the homes were found to contain the imported drywall, Overlook told the owners that it would “work with [them], the Unit Owners Association, the general contractor, the suppliers and the appropriate insurance companies to formulate a plan to determine how to best address the situation.” Id.

In light of this offer and subsequent fact-finding by Overlook, Overlook removed and replaced the defective drywall and other property in the affected homes. In return, the owners of the repaired homes signed agreements releasing Overlook from claims and liabilities arising out of the defective drywall. (See, e.g., Colinvaux Aff. Ex. 14). Overlook also removed and replaced the affected drywall from the unsold units which it still owned. However, there is one unit that Overlook has not repaired — the unit owned by Edmonds.

Edmonds refused the offer from Overlook as unacceptable and has since filed or is participating in several lawsuits against Overlook. As to the Virginia suit, on September 3, 2009, Edmonds filed suit against Overlook and other defendants in the Circuit Court for the City of Norfolk, styled Edmonds v. Parallel Design & Dev. L.L.C., Case No. CL09005697-00. It is this suit brought by Edmonds that will be the principle focus of this Opinion and Order. However, since the filing of this declaratory judgment action, two additional suits have been brought against Overlook. On February 10, 2010, Edmonds brought a second suit, filing as part of a putative class action in the United States District Court for the Eastern District of Louisiana, styled Wiltz v. Beijing New Building Materials Public Limited Co., 2:10cv361. On March 19, 2010, Edmonds brought another suit against Overlook in the Eastern District of Louisiana, also filing as part of a putative class action, styled Amato v. Liberty Mutual Insurance Co., 2:10cv932. Since these lawsuits were filed after Nationwide filed its Complaint, and are thus not part of the current Complaint, the Court will not address these two lawsuits in this Opinion and Order. However, Nationwide has filed a motion to amend its complaint to include these lawsuits in its current declaratory judgment action. The Court will address that motion to amend in a separate Order. This Opinion and Order will address, however, the lawsuit Edmonds filed in Norfolk Circuit Court.

1. Edmonds v. Parallel Design and Development

Edmonds filed suit in the Circuit Court for the City of Norfolk against Parallel Design and Development, LLC, The Overlook, LLC, Venture Supply Inc. and The Porter-Blaine Corp. In this suit, Edmonds claims that his “family home located [on] Holly St----[in] Richmond, VA, 23220 ... was built with defective drywall by Overlook and Parallel [Design and Development, L.L.C.].” (Colinvaux Aff. Ex. 16, at ¶ 1). Allegedly, this drywall used in his home “is inherently defective because it emits various sulfide gases and/or other toxic chemicals through ‘off-gassing’ that create noxious odors, and cause damage and corrosion ... to the structural, mechanical and plumbing systems of the Plaintiffs home....” Id. at ¶ 11. Further, the “compounds emitted by the drywall at issue are also capable of, among other things, harming the health of individuals subjected to prolonged exposure.” Id. at ¶ 12. The “chemical compounds cause and have caused dangerous health consequences including, among other things, allergic reactions, respiratory afflictions, sinus and bronchial problems requiring medical attention, including headaches suffered by the Plaintiff.” Id. Additionally, as to health consequences, the state court complaint alleges that “some of the compounds being emitted from Defendants’ defective drywall are very hazardous, some latently affecting the central nervous system and basic oxygenation on a cellular level.” Id. at ¶ 58.

As a result of these underlying factual allegations, Edmonds asserted twelve counts against the defendants in the state action, although not all counts were asserted against each defendant. These counts included: Breach of Contract, Breach of Express Warranty, Breach of Implied Warranties, Negligence, Negligence Per Se, Unjust Enrichment, Private Nuisance, Equitable Relief, Injunctive Relief, and Medical Monitoring, Breach of Implied Warranty of Merchantability, Breach of Implied Warranty of Fitness for a Particular Purpose, Violation of Consumer Protection Act, and Fraud. These claims are relevant to this action because Nationwide has issued several insurance policies to Overlook in recent years that contain language which obligates Nationwide to defend and indemnify Overlook from lawsuits if certain conditions are met.

2. The Subject Insurance Claims

Because of the existence of these policies, on May 20, 2009, counsel for Overlook informed Nationwide by letter that it had “recently learned that the town home project, The Overlook Townhouses, ... may contain imported Chinese Drywall.” (Sjullie Aff. Ex. 1, at 1). This letter was to put Nationwide “on notice of all potential claims for property damage; personal injury; breach of contract; breach of warranty; indemnification; contribution; and any and all other related claims arising from the use of [defective drywall].... ” Id. at 2. The Edmonds suit pending in Norfolk Circuit Court was filed shortly thereafter, in September 2009. To date, Nationwide is participating in Overlook’s defense of the Edmonds Norfolk Circuit Court suit, subject to a reservation of rights.

There are a total of twenty-six insurance policies issued by various Nationwide entities that are at issue in the present action. Although there are a number of policies, they generally include one of three types of coverage. First, some of the policies provide property insurance, which requires Nationwide to “pay for direct physical loss of or damage to Covered Property....” (Sjullie Aff. Ex. 4). Second, liability insurance provides that Nationwide “pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ or ‘property damage’ to which this insurance applies.” (Sjullie Aff. Ex. 8). Third, excess (or “umbrella”) liability insurance provides that Nationwide “will pay on behalf of the ‘insured’ that part of ‘loss’ covered by this insurance in excess of the total applicable limits of’ underlying liability insurance. (Sjullie Aff. Ex. 28). Nationwide argues in its motion for summary judgment that the Pollution Exclusion in all of the relevant policies prevents it from having to cover losses associated with defective drywall.

3. Pollution Exclusion

Despite the differences between the Nationwide property, liability, and excess liability policies, they all contain similar Pollution Exclusions. All of the relevant coverages in the applicable Nationwide policies include a definition of the term “pollutants.” Although there are minor wording variations across the policies, “pollutants” are generally defined as “any solid, liquid, gaseous, or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste.” (Nationwide’s Mem. Supp. Mot. Summ. J. 12; Sjullie Aff. Ex. 8).

As to the Nationwide Property Coverages, they all state that “ [w]e will not pay for loss or damage caused directly or indirectly by any of the following ----[discharge, dispersal, seepage, migration, release or escape of pollutants.... ” (Sjullie Aff. Ex. 4) (internal quotations omitted).

As to the Nationwide Liability and Excess Liability Coverages, the language of their Pollution Exclusions vary. All of the Nationwide Liability and certain of the Excess Liability Coverages provide that the liability insurance “does not apply to:”

1) “Bodily injury” or “property damage” arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of “pollutants:”

a) At or from any premises, site or location which is or was at any time owned or occupied by, or rented or loaned to, any insured.

d) At or from any premises, site or location on which any insured or any contractors or subcontractors working directly or indirectly on any insured’s behalf are performing operations if the “pollutants” are brought on or to the premises, site or location in connection with such operations by such insured, contractor or subcontractor. However, this subparagraph does not apply to:

(ii) “Bodily injury” or “property damage” sustained within a building and caused by the release of gases, fumes or vapors from materials brought into that building in connection with operations being performed by you or on your behalf by a contractor or subcontractor. ...

(Sjullie Aff. Ex. 8).

In the remaining Excess Liability policies, the Pollution Exclusion applies to exclude all “ ‘[bjodily injury’, ‘property damage’ ... which would not have occurred in whole or part but for the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants at any time.” (Sjullie Aff. Ex. 28).

B. Procedural History

1. Federal Complaint

Nationwide’s Complaint seeks a declaratory judgment on a number of different issues. (Docket No. 1). First, in Count I, the Complaint seeks a declaration that “Nationwide has no obligations under the property coverages of the Nationwide Policies in connection with the Overlook Property Coverage Claims.” (Compl. p. 49). These property coverage policies apply to direct physical loss of or damage to covered property — specifically property that Overlook still owns. Second, in Count II, Nationwide seeks a declaration that it “has no obligation under the Nationwide Policies to defend Overlook in connection with the Overlook Liability Coverage Claims.” Id. In Count III, Nationwide seeks a declaration that it “has no obligation under the Nationwide Policies to indemnify Overlook in connection with the Overlook Liability Coverage Claims.” Id. at 50. In Count IV, Nationwide seeks a declaration that “Nationwide has no obligation under the Nationwide Policies to defend Overlook in connection with the Edmonds Lawsuit.” Id. In Count V, Nationwide requests a declaration that it “has no obligation under the Nationwide Policies to indemnify Overlook in connection with the Edmonds Lawsuit.” Id. In response to this Complaint, Overlook filed a counterclaim, asserting a Breach of Contract claim against Nationwide, grounded in Nationwide’s refusal to provide insurance coverage stemming from such drywall damage.

After significant motions practice, on October 7, 2010, Nationwide moved the Court for an Order granting it leave, pursuant to Local Rule 56(c), to file a motion for summary-judgment limited to the issue of whether the Pollution Exclusion in the insurance contracts eliminates Nationwide’s duty to defend and indemnify Overlook. (Docket No. 47). On October 25, 2010, the Court held a status conference between the parties to discuss the issues raised in that motion. Following that conference, the Court issued an Order on November 1, 2010. (Docket No. 73). In that Order, the Court granted Plaintiffs leave to file a motion for summary judgment solely on the legal issue of whether the Pollution Exclusion barred coverage in this case. Since Nationwide’s motion was to solely address legal issues, the Court’s Order stayed factual discovery. Id. Subsequently, Nationwide filed its motion for summary judgment, which was followed by a number of motions from the Defendants, including cross motions for summary judgment.

2. Natiomvide’s Motion for Summary Judgment

Nationwide’s motion for summary judgment makes two principal arguments with respect to the Pollution Exclusions in the current case. The first argument involves Overlook’s requests for reimbursement for expenses incurred repairing homes, other than the one owned by Edmonds. Importantly, in order for the Court to make a determination as to whether these expenses fall within the policies’ coverage provisions, Nationwide must present “litigated facts” that the Court can compare to the policy language in determining whether coverage exists.

The second argument in Nationwide’s motion, and the one that this Opinion and Order addresses, involves Overlook’s claims relating to Edmonds’ property. According to Nationwide, it has no obligation to defend or indemnify Overlook with respect to the Edmonds lawsuits, because under the Eight Corners Rule, the “allegations of the Edmonds complaints fall squarely within the Pollution Exclusions in the Nationwide Liability and Excess Liability Coverages.” (Nationwide’s Mem. Supp. Mot. Summ. J. 22). This argument is not limited to Edmonds’ suit in the Circuit Court for the City of Norfolk, but rather involves the Wiltz and Amato actions as well. However, because the Court has not yet addressed Nationwide’s motion to add the other two lawsuits to the Complaint, and because the parties have not had an opportunity to brief the summary judgment motion with respect to those lawsuits, this Opinion and Order only addresses the Edmonds suit pending in the Circuit Court for the City of Norfolk.

3. Edmonds’ Motion to Strike

On October 29, 2010, Edmonds “move[d] this Court to strike the Plaintiffs’ Motion for Summary Judgment, or, in the alternative, hold consideration of it in abeyance until the close of discovery....” (Edmonds’ Mot. to Strike; Docket No. 71). Edmonds’ principal argument in that motion is that the Court imposed limitations on the reach of Nationwide’s motion for summary judgment both in the status conference between the parties and the Court’s subsequent November 1, 2010 Order. According to Edmonds, Nationwide’s motion exceeds those limits. From Edmonds’ perspective, the Court stayed factual discovery because Nationwide’s motion was only supposed to argue purely legal issues. Therefore, Edmonds argues the Court should only consider Nationwide’s obligations with respect to the Edmonds claims — the resolution of which does not require the Court to make factual determinations — and hold in abeyance any decision on Nationwide’s coverage obligations with respect to the other twelve units until the parties have completed sufficient factual discovery for “litigated facts” to be determined.

J. Overlook’s Stance on the Reach of Nationwide’s Motion

While Overlook did not respond to Edmonds’ motion to strike, in its memorandum in opposition to Nationwide’s summary judgment motion it attaches a Rule 56(f) declaration from John J. Rasmussen, counsel for Overlook. (Overlook’s Mem. Opp’n Mot. Summ. J Ex. A; Docket No. 77). In this declaration, Rasmussen requests a continuance in the event that the Court is inclined to grant the motion for summary judgment. During this continuance, Rasmussen asserts that Overlook “intend[s] to provide expert reports and other expert discovery regarding the science behind the type of harm allegedly caused by drywall that [Overlook] believe[s] will show the pollution exclusion does not apply.” Id. Overlook did not provide such evidence at the time of its response to the motion because “[t]heir time to provide such expert reports did not expire before discovery was stayed.” Id. Therefore, while Overlook believes that the duty to defend in the underlying Edmonds action can be determined based on the Eight Corners Rule, it contends that the Court cannot make a duty to indemnify determination at this point in the proceedings because such a determination requires factual discovery.

5. Overlook’s Motion for Summary Judgment

On November 17, 2010, Overlook responded to Nationwide’s motion for summary judgment by also filing its own motion for summary judgment. (Docket No. 81). In this motion, which is limited to Nationwide’s duty to defend Overlook in the Edmonds action, Overlook seeks a declaration that Nationwide has a duty to defend Overlook against Edmonds’ complaint because, according to Overlook, the Pollution Exclusion does not act to bar coverage on the facts of this case. In the alternative, Overlook contends that even if the exclusion does apply to some of the claims in Edmonds underlying lawsuit, many of Edmonds allegations do not implicate the alleged defect in the drywall and thus do not trigger the Pollution Exclusion. Therefore, according to Overlook, since some of the claims are not excluded from coverage under the Pollution Exclusion, Nationwide has a duty under Virginia law to defend Overlook as to all the claims in the Edmonds action pending in the Circuit Court for the City of Norfolk.

6. Edmonds Motion for Summary Judgment

On November 29, 2010, Edmonds also filed a motion for summary judgment. (Docket No. 88). This motion requests that the Court declare, as a matter of law, that Nationwide must defend Overlook in the underlying Edmonds suit. While this motion raises substantially the same arguments as can be found in Overlook’s Motion, it does also point to a different paragraph in the Pollution Exclusion, not previously raised by any party, that Edmonds contends requires Nationwide to defend Overlook.

7. Motion Hearing and Certification

The Court heard extensive oral argument on these summary judgment motions on March 8, 2011. During this oral argument, the Court advised the parties that, consistent with its prior ruling and Order, it only intended to rule on that portion of the summary judgment motion involving the underlying Edmonds state court complaint — because that was the only portion of the summary judgment motion that raised purely legal issues. The rest of the issues raised in Nationwide’s summary judgment motion require the determination of facts — “litigated facts” — since the parties have not stipulated to such facts. As to the legal issue regarding Nationwide’s duty to defend and indemnify Overlook with respect to Edmonds’ state court claims, Edmonds’ counsel indicated at the hearing that he had planned to file a motion requesting that the Court certify the Pollution Exclusion coverage issue to the Supreme Court of Virginia, but had not yet done so. See R. Sup. Ct. Va. 5:40. Such certification motion was filed on March 9, 2011, and this Court entered an Order of Certification to the Supreme Court of Virginia on April 12, 2011. (Docket No. 121). In this Order of Certification, the Court posed the following question to the Supreme Court:

In the pollution exclusion clause of the relevant insurance contracts, is the definition of “pollutant,” as “any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste,” ambiguous, 1) because it could be interpreted to apply only to traditional environmental pollutants, 2) because it is so broad that it could cover virtually any substance and potentially lead to absurd results, or 3) because it is substantively unreasonable?

By Order of April 22, 2011, the Supreme Court of Virginia “declined to accept this certified question of law.” (Docket No. 129). As a result, the Court addresses the reach of the Pollution Exclusion below.

II. Standard of Review

A. Applicable Law

This case was brought before this Court under diversity of citizenship jurisdiction. (Compl. ¶ 12). In suits filed in federal court under diversity jurisdiction, questions of procedural law are governed by federal law, e.g., Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 427, 116 S.Ct. 2211, 135 L.Ed.2d 659 (1996), whereas questions of substantive law are governed by the law of the forum state, e.g., Salve Regina Coll. v. Russell, 499 U.S. 225, 226, 111 S.Ct. 1217, 113 L.Ed.2d 190 (1991) (stating that this rule applies “absent a federal statutory or constitutional directive to the contrary”). See Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Since Virginia is the forum state, under Virginia law, “ ‘the law of the place where an insurance contract is written and delivered controls issues as to its coverage.’ ” Firemen’s Ins. Co. v. Kline & Son Cement Repair, Inc., 474 F.Supp.2d 779, 788 (E.D.Va.2007) (quoting Buchanan v. Doe, 246 Va. 67, 431 S.E.2d 289 (1993)). Given that Nationwide has introduced evidence that the policies were delivered in Virginia, (Sjullie Aff. ¶ 6), and that evidence is not contradicted by Overlook or Edmonds, such a state of facts is reasonable to infer. Therefore, while this Court must apply the federal standard for summary judgment, Gen. Accident Fire and Life Assurance Corp., Ltd. v. Akzona, Inc., 622 F.2d 90, 93 n. 5 (4th Cir.1980), the underlying insurance contract issue must be analyzed under Virginia law. See, e.g., Res. Bankshares Corp. v. St. Paul Mercury Ins. Co., 407 F.3d 631, 635-36 (4th Cir.2005).

B. Summary Judgment Standard

“Summary judgment is particularly well-suited for resolution of insurance coverage disputes because the construction of insurance contracts is a legal question.” Mount Vernon Fire Ins. Co. v. Adamson, Case No. 3:09cv817, 2010 WL 3937336, at *2, 2010 U.S. Dist. LEXIS 106758, at *4 (E.D.Va. Sept. 15, 2010) (citations omitted). According to Rule 56 of the Federal Rules of Civil Procedure, “[a] party may move for summary judgment, identifying each claim or defense — or the part of each claim or defense — on which summary judgment is sought.” Fed.R.Civ.P. 56(a). The Rule goes on to state that “[t]he court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Id. The mere existence of some alleged factual dispute between the parties “will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Furthermore, only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be considered by a court in its determination. Id. at 248, 106 S.Ct. 2505.

Once a motion for summary judgment is properly made and supported, the opposing party has the burden of showing that a genuine dispute of fact exists. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). At that point, “the judge’s function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Anderson, 477 U.S. at 249, 106 S.Ct. 2505. In doing so, the judge must construe the facts in the light most favorable to the non-moving party, and may not make credibility determinations or weigh the evidence. Id. at 255, 106 S.Ct. 2505; Holland v. Wash. Homes, Inc., 487 F.3d 208, 213 (4th Cir. 2007). However, there must be “sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party. If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted.” Anderson, 477 U.S. at 249-50, 106 S.Ct. 2505 (citations omitted). While the Court must observe the above-mentioned federal procedure in assessing motions for summary judgment, it must apply the substantive law of Virginia in the present case.

C. Virginia Law of Insurance Contracts

1. Duty to Defend and Duty to Indemnify

Since Nationwide has requested declaratory judgments on the issues of both its “duty to defend” and “duty to indemnify” Overlook, the Court will briefly address the rules of decision with respect to those two duties, before addressing general principles of Virginia insurance contract interpretation.

“Under Virginia law, an insurer’s duty to defend arises ‘whenever the complaint against the insured alleges facts and circumstances, some of which, if proved, would fall within the risk covered by the policy.’ ” Penn-America Ins. Co. v. Coffey, 368 F.3d 409, 413 (4th Cir.2004) (quoting Brenner v. Lawyers Title Ins. Corp., 240 Va. 185, 397 S.E.2d 100 (1990)). Duty to defend questions do “not require the district court to resolve factual questions at all. It need only decide such coverage by comparing what [the state court Plaintiff] has alleged in the state court action with the language of the [provider’s] insurance policy.” Id. “[TJhere is no duty to defend ‘if it appears clearly that the insurer would not be liable under its contract for any judgment based upon the allegations.’ ” Id. (quoting Brenner, 240 Va. at 189, 397 S.E.2d 100). Since courts must only compare the allegations contained within the four corners of the complaint to the terms contained within the four corners of the insurance contract, this standard of review for duties to defend is often referred to as the “Eight Corners Rule.” See CACI Int’l, Inc. v. St. Paul Fire & Marine Ins. Co., 566 F.3d 150, 155 (4th Cir.2009); Capitol Envtl. Servs, v. N. River Ins. Co., 536 F.Supp.2d at 640 n. 14 (quoting Solers, Inc. v. Hartford Cas. Ins. Co., 146 F.Supp.2d 785, 791 (E.D.Va.2001)) (“The Eight Corners Rule is a combination of the Exclusive Pleading Rule, under which ‘an insurer’s duty to defend is determined solely by the claims asserted in the pleadings’ and the Potentiality Rule, under which “an insurer’s duty to defend is triggered if there is any ‘potentiality’ that the allegations in the pleadings could state a claim that would be covered by the policy.””).

The duty to indemnify, on the other hand, is different than the duty to defend. It is a narrower obligation. Minn. Lawyers Mut. Ins. Co. v. Antonelli, Terry, Stout & Kraus, LLP, 355 Fed.Appx. 698, 704 (4th Cir.2009) (unpublished). “While the duty to defend is based on the allegations in the underlying complaint, the duty to indemnify relies on litigated facts.” CACI Int’l, Inc., 566 F.3d at 155. “ ‘An insurer’s duty to defend is triggered if there is any possibility that a judgment against the insured will be covered under the insurance poliey[,]’ ” id. (quoting Bohreer v. Erie Ins. Grp., 475 F.Supp.2d 578, 584 (E.D.Va.2007)), whereas “[t]he duty to indemnify ... refers to an insurer’s responsibility to pay a monetary award when its insured has become liable for a covered claim.” Perdue Farms, Inc. v. Travelers Cas. & Sur. Co. of Am., 448 F.3d 252, 257-58 (4th Cir.2006).

In order to make this indemnification determination, where there is an underlying state suit, the court considering the duty to indemnify question must generally analyze the ultimate findings of fact in the underlying state suit once it is concluded, rather than making its own evidentiary findings in the first instance. Builders Mut. Ins. Co. v. Futura Grp., L.L.C., No. 2:10CV324, 779 F.Supp.2d 529, 533-34, 2011 WL 1549275, at *4, 2011 U.S. Dist. LEXIS 45137, at *11 (E.D.Va. Apr. 21, 2011); Pa. Nat’l Mut. Cas. Ins. Co. v. Block Roofing Corp., 754 F.Supp.2d 819, 827 (E.D.Va.2010) (applying Virginia law and concluding that a duty to indemnify decision is only made “after the state court has made its decision”); Capitol Envtl. Servs., Inc., 536 F.Supp.2d at 645 (applying Virginia law and explaining that a duty to indemnify determination is made based on facts actually discovered or proven at an underlying trial); see also Perdue Farms, Inc. v. Nat’l Union Fire Ins. Co., No. 04-1176, - Fed.Appx. -, ---, 2005 WL 1316955, at *5-8, 2005 U.S.App. LEXIS 10136, *16-23 (4th Cir.2005) (applying Florida law and looking to jury verdict and trial transcript in determining litigated facts to apply to policy language). After analyzing those state court findings, the court considering the duty to indemnify question must apply the applicable jurisdiction’s duty to indemnify law and reach a conclusion on whether an obligation to indemnify exists. With these principles of Virginia insurance law in mind, the Court must briefly discuss general principles of Virginia insurance contract interpretation.

2. General Principles of Virginia Insurance Contract Interpretation

Before conducting the duty to defend analysis and comparing the allegations in the four corners of the underlying complaint to the policy language, the Court must determine the meaning of the policy language. “Courts interpret insurance policies, like other contracts, in accordance with the intention of the parties gleaned from the words they have used in the document.” Seals v. Erie Ins. Exch., 277 Va. 558, 562, 674 S.E.2d 860 (2009) (quoting Floyd v. N. Neck Ins. Co., 245 Va. 153, 158, 427 S.E.2d 193 (1993)). Therefore, “a court must adhere to the terms of a contract of insurance as written, if they are plain and clear and not in violation of law or inconsistent with public policy.” Blue Cross & Blue Shield v. Keller, 248 Va. 618, 626, 450 S.E.2d 136 (1994). The Virginia courts “interpret the unambiguous terms of a contract according to their plain meaning.” Uniwest Constr., Inc. v. Amtech Elevator Servs., 280 Va. 428, 444, 699 S.E.2d 223 (2010). It is not the function of the Court to “ ‘make a new contract for the parties different from that plainly intended and thus create a liability not assumed by the insurer.’ ” Keller, 248 Va. at 626, 450 S.E.2d 136 (quoting Pilot Life Ins. Co. v. Crosswhite, 206 Va. 558, 561, 145 S.E.2d 143 (1965)).

However, “[b]ecause insurance companies typically draft their policies without the input of the insured, the companies bear the burden of making their contracts clear.” Res. Bankshares Corp., 407 F.3d at 636. “Accordingly, if a[ ] [patent] ambiguity exists, it must be construed against the insurer.” Id. “Where two constructions are equally possible, that most favorable to the insured will be adopted. Language in a policy purporting to exclude certain events from coverage will be construed most strongly against the insurer.” Seals, 277 Va. at 562, 674 S.E.2d 860 (quoting St. Paul Fire & Marine Ins. Co. v. S.L. Nusbaum & Co., Inc., 227 Va. 407, 411, 316 S.E.2d 734 (1984)). “[DJoubtful, ambiguous language in an insurance policy will be given an interpretation which grants coverage, rather than one which withholds it.” Granite State Ins. Co. v. Bottoms, 243 Va. 228, 234, 415 S.E.2d 131 (1992) (quoting Am. Reliance Ins. Co. v. Mitchell, 238 Va. 543, 547, 385 S.E.2d 583 (1989)).

When examining a patent ambiguity, where the language is to be construed against an insurer, such “[a]n ambiguity, if one exists, must be found on the face of the policy.” Id. “[L]anguage is ambiguous when it may be understood in more than one way or when it refers to two or more things at the same time.” Id. “As with other contracts, when interpreting a policy courts must not strain to find ambiguities.” Res. Bankshares Corp., 407 F.3d at 636. “[C]ontractual provisions are not ambiguous merely because the parties disagree about their meaning.” Nextel WIP Lease Corp. v. Saunders, 276 Va. 509, 516, 666 S.E.2d 317 (2008) (citing Dominion Sav. Bank, FSB v. Costello, 257 Va. 413, 416, 512 S.E.2d 564 (1999)).

When ultimately determining whether coverage exists, courts impose separate burdens on each party. “A policyholder bears the burden of proving that the policyholder’s conduct is covered by the policy.” Res. Bankshares Corp., 407 F.3d at 636. However, if the policyholder carries that burden, “the insurer bears the burden of proving that an exclusion applies.” Bohreer, 475 F.Supp.2d at 585. Cognizant of these principles of law, the Court will address the motion for summary judgment below.

III. Discussion

A. The Scope of Nationwide’s Motion

Edmonds has filed a motion to strike Nationwide’s motion for summary judgment on the ground that the motion is outside of the permissible scope discussed in the October 25, 2010 status conference and the Court’s subsequent November 1, 2010 Order. Additionally, Overlook states in its Rule 56(f) declaration that the Court should not consider any issues that require a resolution of factual questions since the parties have not had sufficient time to engage in factual discovery. According to arguments made by both Edmonds and Overlook in writing and at oral argument, Nationwide’s motion for summary judgment was to be limited to solely legal issues. As a result, Edmonds and Overlook contend that, at this juncture, the Court can properly address Nationwide’s duty to defend Overlook with respect to the Edmonds lawsuit, since the resolution of that issue does not require the Court to make factual determinations and thus the Court’s finding would not be affected by the previous discovery stay. However, they urge the Court not to address Nationwide’s duty to indemnify Overlook with respect to the other twelve remediated units because any decision on that issue requires the Court to make factual determinations requiring additional discovery and the presentation of litigated facts.

As the Court stated during oral argument, and memorializes in this Opinion and Order, because Nationwide’s motion for summary judgment was to be limited to only legal issues, this Opinion and Order will only address Nationwide’s duties with respect to Edmonds’ claims — which can be resolved under the Eight Corners Rule. Although the Court recognizes that a motion to strike is an improper procedural tool for striking another motion, and therefore the Court declines to grant Edmonds’ motion to strike, the Court has discretion to limit the reach of Nationwide’s motion for summary judgment under the Court’s inherent power to manage its docket and discovery. See, e.g., Ingle v. Yelton, 264 Fed.Appx. 336, 338 (4th Cir.2008) (“[T]he scope and conduct of discovery lie within the sound discretion of the district court.”) (unpublished).

Although the Court has limited the reach of Nationwide’s motion for summary judgment, the issues that the Court will address cannot be dealt with summarily. The parties have raised a substantial number of arguments and the Court must analyze Nationwide’s insurance obligations to Overlook vis-á-vis Edmonds’ claims. Those issues are discussed below.

B. Duty To Defend Overlook on the Edmonds Claims

1. Edmonds Lawsuit in the City of Norfolk Circuit Court

Nationwide argues that the Pollution Exclusion above is unambiguous and excludes coverage for Edmonds’ suit. However, Overlook and Edmonds argue that the Pollution Exclusion is ambiguous, meaning reasonable minds could differ on whether Edmonds’ allegations trigger the exclusion, and as a result, the language should be construed against the insurer.

As mentioned previously, “[a] policyholder bears the burden of proving that the policyholder’s conduct is covered by the policy.” Res. Bankshares Corp., 407 F.3d at 636. However, “the insurer bears the burden of proving that an exclusion applies.” Bohreer, 475 F.Supp.2d at 585. In this case, however, since Nationwide’s motion for summary judgment was specifically limited to the subject of the Pollution Exclusion, the Court need not address the initial question of whether the defective drywall claims are covered within the standard policy provisions. The Court must only address, assuming the policy would ordinarily cover such claims, whether the Pollution Exclusion applies to exclude coverage. As such, the burden is on the insurer — -Nationwide—to show that the exclusion is applicable.

The question of whether the exclusion applies is addressed under the Eight Corners Rule. According to that rule, the district court “need only decide such coverage by comparing what [the state court Plaintiff] has alleged in the state court action with the language of the [provider’s] insurance policy.” Penn-America Ins. Co., 368 F.3d at 413. If, when examining the insurance policy, the Court determines that the policy is “plain and clear and not in violation of law or inconsistent with public policy,” the court “must adhere to the terms of a contract of insurance as written.” Keller, 248 Va. at 626, 450 S.E.2d 136. However, if the court determines that the exclusion is patently ambiguous and “two constructions are equally possible, that most favorable to the insured will be adopted. Language in a policy purporting to exclude certain events from coverage will be construed most strongly against the insurer.” Seals, 277 Va. at 562, 674 S.E.2d 860 (quoting St. Paul Fire & Marine Ins., 227 Va. at 411, 316 S.E.2d 734). Consequently, the Court’s determination of the Pollution Exclusion issue must begin by discussing the allegations in Edmonds’ suit.

Edmonds alleges that the drywall used in his home “is inherently defective because it emits various sulfide gases and/or other toxic chemicals through ‘off-gassing’ that create noxious odors, and cause damage and corrosion ... to the structural, mechanical and plumbing systems of the Plaintiffs home.... ” (Colinvaux Aff. Ex. 16, at ¶ 11). Further, the “compounds emitted by the drywall at issue are also capable of, among other things, harming the health of individuals subjected to prolonged exposure.” Id. at ¶ 12. The “chemical compounds cause and have caused dangerous health consequences including, among other things, allergic reactions, respiratory afflictions, sinus and bronchial problems requiring medical attention, including headaches suffered by the Plaintiff.” Id. Additionally, as to health consequences, the complaint alleges that “some of the compounds being emitted from Defendants’ defective drywall are very hazardous, some latently affecting the central nervous system and basic oxygenation on a cellular level.” Id. at ¶ 58.

With these allegations in mind, the Court must compare the allegations in Edmonds’ complaint to the language of the Pollution Exclusion in the relevant policies, and determine if the allegations in the complaint unambiguously fall within the reach of the Pollution Exclusion. If the allegations are within the exclusion, with no allegations in Edmonds’ complaint falling outside the exclusion, Nationwide has no duty to defend Overlook with respect to Edmonds’ underlying lawsuit. Further, if there is no duty to defend, there can be no duty to indemnify with respect to the claims in Edmonds’ lawsuit because the duty of indemnification applies in a narrower set of circumstances than the duty to defend. See Penn-America Ins. Co., 368 F.3d at 413 (“Although an insurer’s duty to indemnify will depend on resolution of facts alleged in the complaint, no such factfinding is necessary if there is no duty to defend because the allegations, even when taken as proved, would fall outside the policy’s coverage.”). The Court begins its analysis where the language of the Pollution Exclusion begins, with the question of whether Edmonds has alleged “bodily injury” or “property damage.”

a. Bodily Injury or Property Damage

According to the Liability Insurance and Excess Liability Coverages, the insurance does not apply to “bodily injury” or “property damage” arising out of pollutants. Therefore, before addressing the issue of whether Edmonds’ allegations refer to “pollutants,” the Court must determine whether the injuries complained of by Edmonds are “bodily injury” or “property damage.” In Edmonds’ suit, he asserts twelve claims. In each of these claims, Edmonds concludes the count with a statement such as “[a]s a direct consequence of the material breaches ... Plaintiff have [sic] sustained substantial damages set forth herein,” (Colinvaux Aff. Ex. 16, at ¶ 20), “Plaintiff has incurred economic and other damages set forth herein,” id. ¶ 68, or “Plaintiff has suffered damages set forth herein.” id. ¶ 75. Therefore, the Court must look to the damages section of the state court complaint to determine the types of damages Edmonds has allegedly suffered.

In the damages section, Edmonds describes in detail the damages to which he is referring. This section states that “Plaintiff has suffered damage because their home contains inherently defective drywall that has caused damage to their home, Other Property, and their health.” Id. at ¶ 90 (emphasis added). This damage includes, but is not limited to, repair or replacement of their family home, other property, materials contaminated or corroded by the drywall as a result of “off-gassing,” costs of medical care, costs of relocation during repairs, storage costs, and other incidental and consequential damages. Id. at ¶ 91. Additionally, Edmonds seeks environmental monitoring, medical care, and monitoring. Id. ¶ 92.

These damages of which Edmonds complains all entail “bodily injury” or “property damage” — two terms that are unambiguous in this context. It matters not that Edmonds’ claims sound in legal theories that do not all specifically mention bodily injury or property damage since it is clear that bodily injury and property damage are precisely the injuries underlying each one of Edmonds’ claims. See Nat’l Elec. Mfrs. Ass’n v. Gulf Underwriters Ins. Co., 162 F.3d 821, 825 (4th Cir.1998) (“Every action involving bodily injury or property damage must assert some theory of liability but the theory chosen has no impact on the cause of the injury.”). Therefore, the allegations in the Edmonds complaint fall within the first portion of the Pollution Exclusion. However, the Court must also consider whether the bodily injury or property damage arose out of actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants.

b. Discharge, Dispersal, Seepage, Migration, Release or Escape

While the Court will consider whether emissions from defective drywall constitute “pollutants” in the following section, this section addresses the issue of discharge, dispersal, seepage, migration, release or escape. Overlook argues that Nationwide has failed to show that any “pollutants” traveled in such a manner. As discussed above, Nationwide need not produce such evidence with respect to the duty to defend. The Court need only look at Edmonds’ claim to determine if allegations made therein allege such a movement of the alleged sulfide gases.

“Because the words ‘discharge,’ ‘dispersal,’ ‘seepage,’ ‘migration,’ ‘release,’ or ‘escape,’ are not defined in the Policy, they must be given their usual, common, and ordinary meaning.” Firemen’s Ins. Co., 474 F.Supp.2d at 798 (citing D.C. McClain, Inc. v. Arlington Cnty., 249 Va. 131, 135, 452 S.E.2d 659 (1995)) (“Words that the parties used are normally given their usual, ordinary, and popular meaning.”). To determine the common and ordinary meaning, the Court looks to a reputable dictionary and considers a term’s common usage. See Centennial Broad., LLC v. Burns, Case No. 6:06cv00006, 2006 WL 2850640, at *11, 2006 U.S. Dist. LEXIS 70974, at *34 (W.D.Va. Sept. 29, 2006) (“Its ordinary and plain meaning can be gleaned by resort to dictionary definitions and common usage.”). While all the terms above may not be applicable to the present case, the following definitions are relevant. The dictionary defines “disperse” as “to spread or distribute from a fixed or constant source,” “release” as “to set free from restraint, confinement, or servitude,” and “escape” as “to issue from confinement .” See Merriam-Webster Online Dictionary (2011).

When applying the above definitions to the allegations in Edmonds’ lawsuit, it is clear that Edmonds has alleged movement on the part of the sulfide gases that fall within the scope of the Pollution Exclusion. Edmonds’ complaint states that the inherently defective drywall “emits various sulfide gases and/or other toxic chemicals through ‘off-gassing.’ ” (Colinvaux Aff. Ex. 16, at ¶ 11). While the term “emit” is not used in the Pollution Exclusion, the dictionary definition of the term defines it as “throw[ing] or giv[ing] off,” as in “chimneys emitting thick, black smoke.” See Merriam-Webster Online Dictionary (2011). If a chimney emits thick, black smoke, it can be said that the smoke is “spreading] ... from a fixed source” — which is the dictionary definition of disperse. Moreover, the dictionary lists “discharge” and “release,” both words used in the Pollution Exclusion, as synonyms for the term “emit.” See Merriam-Webster Online Dictionary (2011). As a result, Edmonds’ allegations in his complaint regarding the movement of the sulfide gases satisfy the discharge, dispersal, seepage, migration, release or escape requirement of the Pollution Exclusion. However, the Court must still address whether those sulfide gases can be classified as pollutants.

c. Pollutants

As mentioned above, despite minor wording variations, the relevant policies all define “pollutants” as “any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste.” (Sjullie Aff. Ex. 8). Therefore, in order for a substance to qualify as a pollutant it must be both: (1) solid, liquid, gaseous, or thermal; and an (2) irritant or contaminant.

As to the first element of the definition, it is clear that Edmonds has alleged that the substance affecting his house is “gaseous.” His complaint specifically states that the drywall is “inherently defective because it emits various sulfide gases and/or other toxic chemicals through ‘off-gassing.’ ” (Colinvaux Aff. Ex. 16, at ¶ 11 (emphasis added)). Further, in the damages section of the complaint, Edmonds alleges that materials within his home have been contaminated because of “off-gassing.” Id. at ¶ 91. In fact, the parties have not asserted that Edmonds alleges anywhere in his complaint harm caused by a substance not in a solid, liquid, or gaseous state. As a result, the Court concludes that the sulfide gases complained of are gases within the first portion of the definition of pollutant.

i. Irritant or Contaminant

The relevant insurance policies also require the harm-causing substance to be unambiguously classified as an irritant or contaminant. Nationwide argues that the gases produced by the defective drywall are irritants and contaminants, based purely on the dictionary definition of the words. Overlook and Edmonds disagree with Nationwide’s classification. According to Overlook and Edmonds, regardless of whether sulfide gases that cause property damage and bodily injury might otherwise be classified as irritants or contaminants, in the context of the present case, those gases cannot be unambiguously classified as pollutants. They argue that the definition of pollutant is ambiguous for a myriad of reasons and consequently the Court must construe the exclusion against the insurer and in favor of coverage. For the reasons set forth below, the Court concludes that the allegations in Edmonds’ complaint unambiguously fall within the ambit of the relevant Pollution Exclusions.

(a). Traditional Environmental Pollution

The first argument pressed by Edmonds and Overlook asserts that the Pollution Exclusion was meant to exclude coverage for damage caused by traditional environmental pollution, not damage allegedly caused by drywall used in the construction of a home. Since this case does not present an instance of a traditional environmental pollutant, Overlook and Edmonds contend that the Pollution Exclusion does not apply to the present case.

“The word ‘pollutant’ has received a great deal of scrutiny by the courts” and has been the subject of intense litigation. Firemen’s Ins. Co. 474 F.Supp.2d at 789. According to the court in Firemen’s Insurance Co., “[njumerous courts have held that a pollution exclusion bars coverage for all injuries caused by the release of pollutants, even where the pollutant is dispersed into a confined or indoor area.” Id. at 792 (collecting cases) (citation omitted). However, “other courts have held that the exclusion does not apply if the facts show that the discharge, dispersal, release or escape was a localized toxic accident occurring within the vicinity of the pollutant’s intended use.” Id. at 793 (collecting cases) (citation omitted).

While the court is cognizant of the positions of other courts in other jurisdictions, its principal task is to try “to determine how the highest state court would interpret the law,” and in doing so, it “should not create or expand that State’s public policy.” Wade v. Danek Med., Inc., 182 F.3d 281, 286 (4th Cir.1999) (quoting Talkington v. Atria Reclamelucifers Fabrieken BV, 152 F.3d 254, 260 (4th Cir.1998)). See St. Paul Fire & Marine Ins. Co. v. Jacobson, 48 F.3d 778, 783 (4th Cir.1995) (“[T]he federal courts in diversity cases, whose function it is to ascertain and apply the law of a State as it exists, should not create or expand that State’s public policy.”). Therefore, the Court must first turn to the Supreme Court of Virginia to determine whether it has spoken on the issue.

In City of Chesapeake v. States Self-Insurers Risk Retention Grp., Inc., 271 Va. 574, 628 S.E.2d 539 (2006), the Supreme Court of Virginia was faced with a certified question, asking whether claims by women who alleged that they all suffered miscarriages resulting from exposure to “THMs” in the City of Chesapeake’s water supply were precluded by the Pollution Exclusion in a relevant insurance policy. Id. at 576, 628 S.E.2d 539. The definition of “pollutants” in the relevant policy in that case was identical to the definition of “pollutants” in the present case. See id. at 577-78, 628 S.E.2d 539. There, the court determined that the Pollution Exclusion was applicable to THMs in the water supply and thus coverage was precluded. Id. at 578, 628 S.E.2d 539. Although the facts in City of Chesapeake differed from those presently before this Court, the Supreme Court of Virginia did provide valuable guidance as to the proper legal analysis this Court should follow in analyzing whether gases, produced indoors, could be classified as pollutants. The court stated that it was unnecessary to evaluate how other jurisdictions had resolved similar contract disputes “because the law of this Commonwealth and the plain language of the insurance policy provide the answer to the certified question.” Id. at 579, 628 S.E.2d 539.

As a result, this Court must look to the contract law of the Commonwealth. One of the basic tenets of Virginia contract law is that the courts, when interpreting a contract, “construe it as written and will not add terms the parties themselves did not include.” Landmark HHH, LLC v. Gi Hwa Park, 277 Va. 50, 57, 671 S.E.2d 143 (2009) (citing TM Delmarva Power, L.L.C. v. NCP of Virginia, L.L.C., 263 Va. 116, 119, 557 S.E.2d 199 (2002)). The Virginia courts “will not insert by construction, for the benefit of a party, a term not express in the contract.” Lansdowne Dev. Co., L.L.C. v. Xerox Realty Corp., 257 Va. 392, 400, 514 S.E.2d 157 (1999). Cognizant of those statements of law, this Court is persuaded by the logic in Firemen’s Insurance Co., where a court in this district was construing a similar Pollution Exclusion pursuant to Virginia law.

There, the court said that “[n]owhere in the Policy is there any reference to the word ‘environment,’ ‘environmental,’ ‘industrial,’ or any other limiting language suggesting the pollution exclusion is not equally applicable to both ‘traditional’ and indoor pollution scenarios.” Firemen’s Ins. Co., 474 F.Supp.2d at 796. To construe such an exclusion as only applying to traditional environmental pollution “would require this Court to interject words into the writing contrary to the elemental rule that the function of the court is to construe the contract made by the parties, and not to reformulate a contract for them.” Id. See TRAVCO Ins. Co., 715 F.Supp.2d at 717 (“Under Virginia law, pollutant exclusions are not limited to ‘traditional environmental pollution.’ ”); W. Am. Ins. Co. v. Johns Bros., Inc., 435 F.Supp.2d 511, 517 (E.D.Va.2006) (determining in the context of that case that heating oil is a pollutant within the Pollution Exclusion). As a result, the Court concludes that the word “pollutant,” when used in this Pollution Exclusion, does not apply solely to traditional environmental pollution.

Although the Supreme Court of Virginia in City of Chesapeake limited its analysis to Virginia law, this Court also concludes that the precedent of the United States Court of Appeals for the Fourth Circuit, applying non-Virginia law, does not dictate a different result. The Fourth Circuit addressed the question of whether Pollution Exclusions are limited to traditional environmental pollutants in two cases in 1998. In National Electrical Manufacturers Ass’n, the court was faced with the question of whether a Pollution Exclusion barred coverage under District of Columbia law for welders who were exposed to welding fumes and suffered neurological injuries as a result. 162 F.3d at 823. In that case, the definition of “pollutant” was similar to the one in the present case, but the Pollution Exclusion as a whole was arguably broader. Specifically, the Pollution Exclusion stated that the exclusion is “effective whether or not the pollution was sudden, accidental, gradual, intended, expected or preventable or whether or not any of You caused or contributed to the pollution.” Id. at 824. In its analysis, the Fourth Circuit concluded that the Pollution Exclusion was “plain,” “unambiguous,” and not limited to “atmospheric or environmental pollution.” Id. at 825-26.

Similarly, in Assicurazioni Generali, S.p.A v. Neil, 160 F.3d 997 (4th Cir.1998), the Fourth Circuit once again declined to find a Pollution Exclusion ambiguous. In that case, many hotel guests sued a partnership that owned the hotel when the guests suffered carbon monoxide poisoning inside the hotel. Id. at 999. Neil, a general partner in the partnership, turned to the hotel’s insurer for coverage. The insurer declined to cover the incident, citing the Pollution Exclusion among other provisions. Although the definition of pollutants in that policy was similar to the definition in the present case, the language of the Pollution Exclusion as a whole was significantly different. For example, the policy stated that the insurance does not apply to “[t]he contamination of any environment by pollutants that are introduced at any time, anywhere, in any way.” Id. Additionally, the policy defined the term environment broadly, including in the definition “any person, any manmade objects or feature ... land, bodies of water ... air and any other feature of the earth or its atmosphere, whether or not altered, developed or cultivated, including ... any of the above, owned, controlled or occupied by the insured.” Id. Given this broad language, the Fourth Circuit concluded that carbon monoxide inside a hotel “plainly falls within this policy definition of ‘pollutant.’ ” Id. at 1000.

While the Fourth Circuit concluded that the Pollution Exclusions in those policies were unambiguous and applied to non-traditional environmental harms, it reached the opposite conclusion in a recent unpublished opinion, NGM Insurance Co. v. Kuras, 407 Fed.Appx. 653 (4th Cir.2011) (unpublished). In order to fully discuss that opinion, the Court must first review the district court opinion that the Kuras court affirmed. In that case, NGM Insurance Co. v. Carolina’s Power Wash & Painting, LLC, No. 2:08-cv-3378-DCN, 2010 WL 146482, 2010 U.S. Dist. LEXIS 2362 (D.S.C. Jan. 12, 2010), the district court was faced with the question of whether, under South Carolina law, a Pollution Exclusion excluded from coverage injuries resulting from exposure to “paint fumes, vapor, dust, and or other residue” inside a post office. Id. at *2, 2010 U.S. Dist. LEXIS 2362 at *4-5. The Pollution Exclusion at issue was identical to the exclusion presently before this Court.

In its analysis, the district court first noted the split of opinion nationwide on the question of whether Pollution Exclusions “bar coverage for incidents outside of traditional environmental pollution.” Id. at *4, 2010 U.S. Dist. LEXIS 2362 at *11. Second, the district court analyzed Fourth Circuit precedent. It distinguished National Electrical Manufacturers Ass’n and Assicurazioni from the case before it because it found the language in those exclusions to be more “sweeping” than the Pollution Exclusion with which it was dealing. Id. at *4, 2010 U.S. Dist. LEXIS 2362 at *14-15. The court then turned to cases from other jurisdictions.

While it noted “that the split of opinions [nationwide] provides only an indication of ambiguity, not a conclusive determination,” Id. at *5, 2010 U.S. Dist. LEXIS