A grocery chain paid nothing toward a $1.37 billion opioid settlement. So its insurers owe nothing, a North Carolina court ruled.
The chain walked away from a nationwide wave of opioid lawsuits without paying a cent - and that fact just cost it its insurance claim.
On July 24, 2026, the North Carolina Business Court ruled that four Great American insurance companies owe the grocery chain no coverage for its share of a nationwide opioid settlement. The reason was simple: the chain was never "legally obligated to pay" anything.
The company runs more than 250 grocery stores across North Carolina and nearby states, many with pharmacies that dispense prescription opioids. It has been a wholly owned subsidiary of a larger grocery parent since January 2014. Between 1995 and 2014, the Great American insurers issued it roughly 26 commercial general liability policies, each promising to pay sums the insured "becomes legally obligated to pay." That short phrase decided the case.
The litigation began in 2017, when governmental entities filed more than 800 opioid lawsuits against the parent company and its subsidiaries. Only one named the grocery chain - a Durham County, North Carolina, case alleging it failed to guard against diversion of prescription opioids, "thereby exacerbating the oversupply of such drugs and fueling an illegal secondary market." That suit sought economic losses, not damages for injury or death.
In March 2024, the parent agreed to a global settlement capped at $1,372,800,000, payable in eleven annual installments. The chain was listed as a "Released Entity," received a full release and was dropped from the Durham County case. The parent, and the parent alone, agreed to pay.
The parent did assign the chain an internal share of $60,493,575.49. But that came from the parent's own bookkeeping, not the settlement terms or any contract between them. Payments flowed from the parent's centralized treasury. The chain never wrote a check, and it admitted it had no legal obligation to pay the parent anything.
That admission sank the claim. Applying a 1994 state appellate decision, the court held that "legally obligated to pay" requires a third party with both a claim and an enforceable remedy against the insured. Because only the parent was bound by the settlement, no government plaintiff could enforce anything against the chain.
The court granted the insurers' motion, denied the chain's and taxed costs to the chain. Because that single issue settled everything, the judge did not reach the insurers' arguments about bodily injury or late notice.
