In November 2004, a bypass valve failed at a MarkWest natural gas liquids pipeline in Kentucky. The escaping NGL's caught fire and exploded injuring a number of people and destroying five homes. The Office of Pipeline Safety investigates the incident and issued an initial Corrective Action Order (CAO) requiring MarkWest to take certain immediate actions to protect the public health and safety. The CAO is later amended by OPS to include additional actions that MarkWest had to take. MarkWest challenges some of the additional actions which eventually lead to further modification of the CAO. At the time of the accident, MarkWest has an "all-risk" property insurance policy with four insurance companies that indemnify MarkWest against "all risks of direct physical loss or damage occuring during the period of this policy from any external cause, except as hereinafter exclude." One of the exclusions is for corrosion and another limits coverage for matters relating to governmental regulation. The insurance companies pay for the third party damages caused by the accident but do not pay for MarkWest's submitted claims for compliance costs of the CAO's. The trial court grants the insurance companies' motion for summary judgment. MarkWest appeals that there are disputed questions of fact as to whether corrosion was the single cause of the accident or one of multiple causes. Held: affirmed. In interpreting the insurance contract, the court finds that MarkWest must show that: 1. An insured peril must cause the governmental enforcement action of a 2. Law or ordinance regulating the construction or repair of damage facilities. The court of appeals agrees with the district court that MarkWest has not show that the accident resulted from an insured peril since corrosion was clearly found to be a significant cause of the accident. Furthermore, the "all risk" policy is not a policy relating to the maintenance of the pipeline which would be the result of the interpretation proffered by MarkWest. Since the insured has not shown that CAO compliance costs are a covered item in its insurance policy, the summary judgment motion is affirmed.
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