Liberty Mutual wants a federal court to say it owes nothing on toxic-waste cleanup claims built on policies it wrote more than 40 years ago.
The carrier sued Vishay Intertechnology, Inc. and Vishay GSI, Inc. on August 26, 2026 in the Northern District of California. It is asking for two rulings: that it does not have to defend either company, and does not have to pay, over an environmental demand from California regulators.
According to the complaint, the trigger came on or about January 9, 2026, when the California Department of Toxic Substances Control named Vishay a “Potentially Responsible Party” – a company the state believes may be on the hook – for contamination at three California sites, in Mountain View, Palo Alto and the Vine Hill Complex in Martinez. The filing describes Vine Hill as a set of former waste disposal facilities that took industrial waste from many companies over several decades.
Here is why an insurer is caught up in a demand tied to sites like these. Liberty says it sold general liability, pollution and umbrella cover to General Instrument Corporation between roughly 1980 and 1997 – 23 policies in all, by the complaint's count. Vishay says it inherited those policies through a chain of corporate deals and now wants Liberty to answer the state's demand. Liberty says it owes nothing.
The numbers on those old policies were modest by today's standards. The complaint puts the earliest general liability limits at $500,000 per occurrence and $1 million in the aggregate, rising to $2 million on the later general liability policies. Each umbrella policy carried $5 million. Waste records in the state proceeding, the filing says, trace the first shipment to Vine Hill to around November 1980 – which Liberty argues limits how many of its policies could even be in play.
Everything hinges on one old deal. In a June 5, 1996 settlement and partial buyback, Liberty says, it paid to close out coverage for these kinds of environmental claims and wiped out almost all of the historical policies. A buyback is what it sounds like: the insurer pays a lump sum to cancel its future obligations under a policy. Liberty says it paid $3 million to buy back the Mountain View exposure, and that the deal reached, in the agreement's words, “any and all actual or alleged insurance policies, whether known or unknown, found or lost.”
Palo Alto was handled differently. The complaint says that site sat outside the main list and was carved out as an “excepted claim,” with the agreement stating that “Liberty will continue to handle the claim within the terms, conditions and limits of the 4/1/87 to 4/1/88 pollution liability policy.” In return, per the filing, General Instrument agreed to give up “any and all rights” to claim under any other policy for those excepted claims.
That carve-out is now the battleground. Vishay contends the Vine Hill claim “arises from” the older Palo Alto contamination, which – on its reading – keeps coverage alive, according to the complaint. Liberty takes the same connection and runs it the other way: if Vine Hill flows from Palo Alto, then every policy except that single 1987 pollution policy was already bought back. And that one does not help either, Liberty argues, because it only responds when a claim is “first made” and reported during the policy period – and the Vine Hill claim, the filing says, landed decades too late.
Vishay also argues the settlement misses Vine Hill entirely, according to the complaint, because the deal's definitions carve out waste sent to a landfill – and Vine Hill, it says, is a landfill.
Liberty stacks up three more defenses in the filing. First, pollution exclusions: it points to clauses across the policies that bar coverage for pollution spread “intentionally by or for the insured” or through “a gradual emission, discharge, release or escape,” and to what it calls an absolute pollution exclusion on one umbrella policy. Second, the “suit” question: Liberty says the state matter is an administrative demand, not a lawsuit in any court, so its promise to defend a “suit” has not switched on. Third, whether Vishay is covered at all: Liberty says Vishay has not handed over the merger and assignment paperwork needed to prove it ever inherited the coverage, stating that on the information provided, “Vishay has not received any assignment of the Liberty policies and is accordingly not an insured under those policies.”
Liberty has asked for a jury trial. It wants the court to declare that it owes no defense and no payment, and that there is no coverage for any of the three sites – except, if at all, the narrow 1987 policy for Palo Alto.
The allegations have not been tested in court, and no judge has ruled on any of the claims.
