The Ninth Circuit reversed the district court’s grant of summary judgment to an insurer who failed to contribute the defense of a co-insured. Liberty Northwest Ins, Corp. v. Atlantic Spec. Ins, Co., No, 24-7353_ (9th Cir. Feb. 20, 2026).

TriQuint Semiconductor was insured by Liberty and Atlantic. TriQuint employee Pedro Domion, his wife, and his minor child sued TriQuint, alleging that Pedro’s exposure to various chemical products and substances caused birth defects in the child. Liberty defended TriQuint but Atlantic did not. Liberty sued for declaratory relief and damages due to Atlantic’s failure to defend.

Liberty and Atlantic agreed that the basic terms of Atlantic’s policy covered the allegations in the underlying complaint but disputed whether three policy exclusions barred coverage.

The Employer’s Liability Exclusion applied to bodily injury to an employee’s child “as a consequence of” injury to the employee. However, the underlying complaint did not specify and mechanism of the minor child’s injuries. Rather, it left open the possibility that the employee’s minor child was injured without injury to the employee himself.

The underlying complaint alleged that TriQuint’s ventilation, industrial hygiene policies, and personal protective equipment were inadequate, suggesting that the employee may have brought the chemical products home without sustaining injury himself. Because the allegations were ambiguous and had to construed in favor of the insured, the complaint stated a basis for a claim not excluded from coverage by the Employer’s Liability Exclusion.

Atlantic’s Pollution Exclusion applied to bodily injury from the “discharge, dispersal, seepage, migration, release or escape of pollutants.” The underlying complaint did not allege that the chemical products and substances discharged, dispersed, seeped, migrated, released or escaped. Instead, it alleged that the employee was “exposed” to the chemical products and substances while working with them inside TriQuint’s facility. The Pollution Exclusion did not unambiguously foreclose coverage.

Finally, the Electromagnetic Radiation Endorsement applied to “injury which . . . is alleged to have been caused by . . . Electromagnetic Radiation.” The underlying complaint alleged that chemical products and substances caused the minor child’s birth defects. This allegation was plainly not covered by the Electromagnetic Radiation Endorsement and thus the exclusion was not applicable.

The Ninth Circuit reversed the district court’s grant of summary judgment to Atlantic and remanded with instructions to grant summary judgment for Liberty on its claim for declaratory relief and for further proceedings.