Non-signatories to a contract are not equitably bound by the agreement even if they are direct beneficiaries, the U.S. Court of Appeals for the Third Circuit has said in a precedential opinion. The appellate court ruling in Flintkote v. Aviva PLC vacated a U.S. District Court for the District of Delaware opinion compelling insurer Aviva PLC to arbitrate its dispute with The Flintkote Co., a former manufacturer of asbestos-based products.
San Francisco roofing-materials manufacturer Flintkote became concerned about the asbestos in its products and procured multiple insurance policies from London-based companies, including Aviva. Asbestos lawsuits against Flintkote began to increase and the company entered into a mass settlement of the claims in 1985, according to court documents.
