A five-month standoff over picking an arbitrator has landed 13 excess liability insurers in federal court - dragged there by PacifiCorp.
The Oregon-based utility, formerly known as Pacific Power & Light Company, filed an application on April 16 in the US District Court for the District of Oregon, asking a judge to step in and appoint an arbitrator on behalf of all thirteen insurer defendants. The move comes after months of failed negotiations over how to get an environmental coverage dispute off the ground.
At the heart of the matter is the Portland Harbor Superfund Site, where PacifiCorp says it has incurred losses tied to investigation and cleanup costs. The company originally sued three of its insurers - Century Indemnity Company, St. Paul Surplus Lines Insurance Company, and Westport Insurance Corporation - in January 2025, alleging breach of contract, unfair environmental claims settlement practices, and seeking a declaratory judgment.
That case landed before Judge Amy Baggio, who compelled arbitration and stayed the litigation. PacifiCorp then demanded arbitration from all thirteen insurers in October 2025 and spent the following months trying to get everyone on the same page.
It did not work.
According to the filing, insurers took conflicting positions on how the arbitration should be structured. Some declined to participate in a coordinated process altogether. Others maintained they were each entitled to appoint their own arbitrator. PacifiCorp even tried to bring in the American Arbitration Association to administer the proceedings in February 2026, but every insurer declined to consent, and the AAA closed its file.
The sticking point is a clause found across the excess policies that calls for "two arbitrators, one to be appointed in writing by each of the parties" when the sides cannot agree on a single arbitrator. PacifiCorp reads "each of the parties" as meaning each side of the dispute - the insured versus the insurers as a group. Some insurers appear to see it differently, treating each carrier as its own "party" entitled to its own arbitrator pick.
PacifiCorp argues that reading would tilt the panel in the insurers' favor, creating an imbalance that defeats the purpose of the clause.
The insurer defendants include Allianz Underwriters, Berkshire Hathaway Specialty Insurance Company, Century Indemnity, Continental Casualty Company, Fireman's Fund Insurance Company, Old Republic Insurance Company, and St. Paul Surplus Lines, among others.
PacifiCorp is asking the court to find that the insurers have failed to follow the agreed method for selecting an arbitrator and to appoint one on their behalf. In the alternative, it wants the court to set a firm deadline for the group to reach agreement - or have an arbitrator appointed for them.
No decision has been made on the application. But the case puts a spotlight on a question that matters beyond this particular dispute: when a standard arbitration clause written for two-party situations meets the reality of a multi-insurer coverage tower, who exactly counts as a "party"?
For carriers sitting in layered excess programs, the answer could shape how these disputes play out going forward.
Case: PacifiCorp v. Allianz Underwriters, Inc. et al., Case No. 3:26-cv-00753 (D. Or.)
