Looks like one very big issue - interpretation of the cumulative limit of liability provisions of the agreement - was not decided by summary judgment, and may be headed for a jury trial. That would explain Zucaro's statement.
I like the following quote from the opinion: "Despite the parties' vigorous arguments to the contrary, the court concludes that both FDIC and Old Republic offer entirely reasonable interpretations of this sloppily drafted contract."
there were 3 issues...the one that goes to jury is whether the loans that FDIC sold to a 3rd party (I assume FDIC still has most default liability) are still coverable
the other two issues: that the loans that FDIC still holds, that are in default, ORI must pay on and ORI trying to squirm out were shot down in favor of FDIC....
so will they have to cover the sold loans?...i am thinking if it goes to jury, ORI will have a tough time as reasonableness will come down on FDIC's side....it is not like the holder of the loans matter.....
I read the jury trial issue as whether cumulative liability under the policy is limited to 10% of total proceeds of all loans originally under the policy, or 10% of the loans retained by the FDIC.
If it goes to a jury, who wins probably depends a lot upon venue and the jurors selected, but i think generally jurors may tend to side with a claimant being denied insurance coverage, rather than the insurer, unless it's clear that the claimant is committing fraud (which isn't the case here). Likewise, if the agreement is sloppy, the contract interpretation may go against the drafter of the agreement.
This will probably settle - there's too much at stake to leave it in the hands of a jury. However, with the loss of 2 of 3 issues at summary judgment, and with the third issue being far from a slam dunk, ORI's settlement position is materially weakened.