Liberty Mutual Can Pursue Coverage Suit Over Cannabis Exclusion

A federal court declined to dismiss a Liberty Mutual Insurance Co. unit’s suit seeking a ruling on its coverage obligations in an underlying case over a butane leak and subsequent explosion at a cannabis product manufacturing facility.

A marijuana-related exclusion in the policy issued by Ohio Security Insurance Co. could plausibly bar coverage, the US District Court for the District of Oregon said in a Tuesday order.

Ohio Security insured Primordial Mountain LLC under a commercial general liability policy. Primordial operated a cannabinoid extraction lab at an industrial warehouse in White City, Ore., that was owned by Mary Laurent Leach ...