Volume XXVII, No. 17 (No. 716)
Friday, January 30, 2026
A Biweekly Electronic Newsletter
As a public service, Hurwitz Fine P.C. is pleased to present its biweekly newsletter, providing summaries of and access to the latest insurance law decisions from the New York, New Jersey, and Connecticut appellate courts and Canadian appellate courts. The primary purpose of this newsletter is to provide timely educational information and commentary for our clients and subscribers.
In some jurisdictions, newsletters such as this may be considered Attorney Advertising.
If you know of others who may wish to subscribe to this free publication, or if you wish to discontinue your subscription, please advise Dan D. Kohane at [email protected] or call 716-849-8900.
You will find back issues of Coverage Pointers on the firm website listed above.
Dear Coverage Pointers Subscribers
Do you have a situation? We love situations.
Welcome to issue No, 716, from your friends with the main office in the 716-area code, for those of you who read this publication because you love our 100 years ago stories, this one is filled with article describing predictions made by various folks 100 years ago today. Have as much fun reading them as I had uncovering and including them,
Before I forget, I wanted to offer you an extra bonus, besides the attached issue of Coverage Pointers. I am in Scottsdale, the land of Waymo’s, self-driving taxis. I haven’t ridden in one yet, but they are all over this town.
Advanced Driver Assistance Systems (ADAS) promise safer roads, but defective design, faulty software, and inadequate warnings are creating a new frontier of product liability risk for automakers, suppliers, and even fleet operators. As responsibility shifts from human drivers to embedded technology, questions of who is at fault after a crash—driver, manufacturer, or both—are becoming more complex and data driven. This article explores emerging theories of liability for defective ADAS, including design and manufacturing defects and failure-to-warn claims, and offers practical steps companies can take in determining. Our own Jay Crowley, with a bit of editorial assistance by the undersigned wrote an article on the subject which is available here: Liability for Defective Driver Assistance Systems. You can reach Jay at [email protected] or in our Rochester office, at 585-454-6850.
There are a good number of interesting cases in this week’s attached issue, about 20 in total.
Coverage Pointers University
Registration is Open for our Third Program
The instructor is the king of SUM Coverage, our own Ryan O’Shea
Summing up “SUM” Coverage: A Primer on Addressing a Demand for New York Supplementary Uninsured/Underinsured Motorist Benefit
Date & Time
February 19, 2026, | 1:00 PM Eastern
Join Insurance Coverage attorney Ryan P. O’Shea for a for a practical webinar covering the fundamentals of NY Supplementary Uninsured/Underinsured Motorist (SUM) coverage. This presentation will address what SUM coverage is, its historical background, and when it applies. The session will also explore the most common issues that arise in SUM claims, including insured status, offsets, and priority of coverage disputes. Finally, the program will walk through how SUM claims typically proceed into litigation or arbitration, providing insight into what to expect and how to navigate these matters effectively in NY.
If you are not comfortable with triggers, offsets, and consents, if you are confused about the difference between mandatory UM coverage and optional SUM coverage. If you are not aware of the 20-day rule¸ and the consequences of not moving for a stay, this program is for you.
Well over 100 are already registered.
Artificial Intelligence and Hallucinated Cases – Interested?
For those who have an interest in artificial intelligence-created hallucinated cases, the beat continues.
On LinkedIn, I reported on a recent decision, a Minnesota District Court chastised a lawyer for not reading another lawyer’s papers closely enough to uncover and report to the court that this other lawyer had submitted fake cases. That report generated over 68,000 impressions so you know that folks are interested in the topic. In a Georgia case, a lawyer was ordered to show cause why he should be sanction for submitting fake cases. That post has exceeded 49,000 impressions The lawyer did not respond and was sanctioned as well
I come to you with greetings from warmer climes. We are still busy as usual out here, although we are finding time for hikes up in the McDowell Mountains (the foothills, anyway). My wife and I have hiked almost 60 miles since we arrived, alternating between hikes and bicycle rides (about 57 miles).
Here are my three views: the back deck of my Buffalo house, the view of Lake Erie from the Land of the Blue Martinis in Fort Erie, Ontario, and the third, my view off the back deck in my current locale, in Scottsdale. Where would you rather be, right now?
Need a Mediator or Arbitrator, Give a Call:
A growing percentage of my practice has been a mediator (and sometimes as an arbitrator) in insurance coverage, commercial, personal injury, and other disputes. With a robust national client base, I am regularly called on by friends and colleagues from around the country, folks who know me and trust me, to help resolve disputes. Often, particularly in mediated matters, I know the insurers and lawyers on both (or several) sides of the dispute. Since they all trust me as a fair dealer, they feel comfortable having me try to help close the file (and avoid precedent). Just pick up the phone, 716.849.8942 or send an email to [email protected] and I’ll try to help.
Newsletters:
We have other firm newsletters to which you can subscribe by simply letting the editor (or me) know, including a new publication, which was created to advise on business and employment law questions:
- Premises Pointers: This monthly electronic newsletter covers current cases, trends and developments involving premises liability and general litigation. Our attorneys must stay abreast of new cases and trends across New York in both State and Federal Court and will now share their insight and analysis with you. This publication covers a wide range of topics including retail, restaurant and hospitality liability, slip and fall accidents, snow and ice claims, storm in progress, inadequate/negligent security, inadequate maintenance and negligent repair, service contracts, elevator and escalator accidents, swimming pool and recreational accidents, negligent supervision, assumption of risk, tavern owner and dram shop liability, homeowner liability and toxic exposures (just to name a few!). Please drop a note to Jody Briandi at [email protected] to be added to the mailing list.
- Labor Law Pointers: Hurwitz Fine P.C.’s Labor Law Pointers offers a monthly review and analysis of every New York State Labor Law case decided during the month by the Court of Appeals and all four Departments. This e-mail direct newsletter is published the first Wednesday of each month on four distinct areas – New York Labor Law Sections 240(1), 241(6), 200 and indemnity/risk transfer. Contact Dave Adams at [email protected] to subscribe.
- Products Liability Pointers: Whether the claim is based on a defective design, flawed manufacturing process, or inadequate instructions/warnings, product liability litigation is constantly evolving. Products Liability Pointers examines recent New York State and Federal cases as well as high court decisions from other jurisdictions, keeping our readers up to date with the latest developments and trends, and providing useful practice tips and litigation strategies. This monthly newsletter covers all areas of product liability litigation, including negligence, strict products liability, breach of warranty claims, medical device litigation, toxic and mass torts, regulatory framework and governmental agencies. Contact V. Christopher Potenza at [email protected] to subscribe.
- Medical & Nursing Home Liability Pointers. Medical & Nursing Home Liability Pointers provides the latest news, developments, and analysis of recent court decisions impacting the medical and long-term care communities. Contact Elizabeth Midgley at [email protected] to subscribe.
Liening Tower of Perley:
Thankfully, as I look out my window, I have a view of adjacent buildings through the ongoing snowfall; a luxury completely denied to us in Buffalo periodically over the last few days. My jealousy for Dan Kohane being comfortably ensconced in Arizona is unbounded.
Today, I am pleased to report on a decision in which we were involved in the Western District with MSP Recovery who has bedeviled insurance companies for years seeking double damages for payments made by Medicare Advantage Organizations through bundling claims and seeking class action status in Federal Court. Is [MSP] Claims v Merchants, the District Court in the Western District dismissed a lawsuit brought by MSP seeking reimbursement from a no-fault carrier for medical payments arising from a motor vehicle accident where there was no no-fault ever filed. This time the Court took a serious interest in the Medicare Secondary Payer Regulations and held that the failure of the injured person to file the no-fault claim precluded MSP from seeking recovery.
This was a ruling we have been seeking for a long time and may pave the way in New York for other carriers to resist claims from recovery companies. It may also be instructive for carriers in other states to review the claim requirements under their no-fault laws in determining how to respond to recovery claims.
In the meantime, we at HF will await a potential appeal and the run of the sun to our neck of the woods.
Mike
Michael F. Perley
[email protected]
Greenland on the Map – 100 Years Ago:
Fitchburg Sentinel
Fitchburg, Massachusetts
30 Jan 1926
Greenland and the Map
(Lowell Courier-Citizen)
Greenland was on the map ten years before Columbus sailed across the Atlantic, according to Cartographical evidence now exhibited at the Boston public library. That isn’t so strange a circumstance when you consider that for centuries previous to 1492 the Norse settlements of the Greenland east coast had been in annual connection with Europe. The Danish national museum at Copenhagen has exhibits of clothing and utensils from the Greenland colonies which tell a fascinating story of people living under the Arctic circle who sought to follow the fashions of middle age Europe. Data concerning these early settlements on an island adjacent to North America are being slowly amassed. They do not in any way detract from the glory of the intrepid discover who was the person to open up the American continents to effective colonization. The hardy Norsemen succumbed to increasing cold and the hostility of the Eskimos. Greenland was dropping off the map at just about the time it was put on the map, so to speak.
Peiper on Property (and Potpourri):
The courts have not been as busy as the snowplow crews over the past two weeks. In fact, we have nothing to report on. It is still cold, snowing and the Courts are silent. Perhaps sunnier, warmer and busier days are ahead. For now, however, we simply remind you that today, January 30th, is National Have Fun at Work Day. It is also National Croissant Day. We trust that finding a croissant is easier than finding “fun,” so bon Appetit. See you in two weeks.
Steve
Steven E. Peiper
[email protected]
He Figured Out Women – 100 Years Ago:
Buffalo Post
Buffalo, New York
30 Jan 1926
W.L. GEORGE
NOTED WOMAN
CRITIC, DEAD
Novelist and Lecturer on
Fair Sex Succumbs to
Pneumonia
London, Jan. 30 (A.P.) – W. L. George, noted writer and lecturer on. women, died today. He was 44 years old, having been born of British parents in Paris in 1882. He received his education in France and Germany.
Mr. George in one of his lectures in New York in 1922 declared that he had analyzed women and catalogued them and that he had 65 distinct species tucked away from which to make Ursula Trents or other interesting characters.
In his analyses her said he put woman on the end of a pin and examined them as it they were interesting insects. Those he had analyzed ranged from 17 to 68 years.
Lawbreaking Animal.
He characterized woman as "the natural lawbreaking animal, as man is the actual law-making animal. He thought it questionable if Eve donned the fig leaf because of modesty. It probably was because she thought the leaf pretty.
He dismissed the idea that there was mystery about women. Woman's intelligence, said "the man who knows all about women," as Mr. George was called, was a thing difficult to isolate. “Women,” he declared, "are always a little in love, and if not they are apt to be uncomfortable, and love being a noisy thing, it obstructs scientific observation, if love is blind, it certainly is not dumb."
"I love women." Explained Mr. George. "I love all women, and that is. perhaps why I have such sympathy for them."
Three Times Wed.
He was married three times. His philosophy on marriage was that "it is the only insurance company which issues a policy against loneliness.”
Lee’s Connecticut Chronicles:
Dear Nutmeggers,
As I often like to joke, I live in southern New England along the Connecticut shoreline; but there’s nothing southern about our on-going freezing weather. We were hit with 14 inches of snow and wind chills as low as 20 below zero. We woke up last weekend to frozen pipes, even though we had the heat going at 68° overnight. I shut off the water main, drained the system, and put space heaters (electric) in the attic and basement to warm the pipes. Luckily, a few hours later, disaster had been averted. Overnight temperatures are still below zero, so in addition to everything else, we’re dripping the faucets. It was scary not knowing if the pipes were going to rupture and it had me running to find a copy of our HO-6 policy. Many of my neighbors are snowbirds; luckily, I’ve not seen any gushing water from their townhouses.
As coverage lawyers, we deal with frozen pipe cases all the time, usually from the comfortable distance of a claim file and a cup of coffee, confidently opining about “reasonable care to maintain heat,” whether someone drained the system before leaving, and is a two-week vacation a vacancy. It’s a very different exercise when you’re standing in your own basement at 6 a.m., listening to pipes creak like a horror movie soundtrack, and realizing you are now the “insured.” Last weekend was a vivid reminder that in real life, those situations unfold in the dark, in the cold, and with a fair amount of panic — and that the line between “preventive measures” and “too little, too late” can feel awfully thin when it’s your own house on the line.
Until next edition, keep warm and dry.
Lee
Lee S. Siegel
[email protected]
Greenland – A Chilly Place – 100 Years Ago:
Times Herald
Washington, District of Columbia
30 Jan 1926
Noted Astronomer and Writer on
Scientific Topics of Popular
Interest
There’s much in a name – Greenland, which should have been called Whiteland, or Iceland, has escaped centuries of objurgation by the aid of its unveracious and deceptive name. Meteorology is unmasking it now. Recently I called attention to Prog. Hobbs’ theory that the glacial winds rushing like aerial avalanches down the mighty ice-clad shoulders of Greenland reawaken the energies of exhausted cyclones dying in the northern Atlantic and set them whirling again with destructive fury.
Look at a globe and note what a singular and menacing geographical phenomenon Greenland is. As a source of ice and cold it has no rival, no second even, in the northern hemisphere. Oh, that miserable, shivering, Labrador current, insinuating its icy nose between the genial flow of the friendly Gulf stream waters and the lichen-whiskered rocks of bleakened New England! That cold sinuous monster is the child, at least the foster-child – of Greenland.
Ruffner’s Road Review:
Dear Readers,
I hope everyone is still enjoying the snow that has been quite unrelenting the past week or so. As for my bi-weekly sports update, I am happy to see the Sabres continue their hot streak and am looking forward to the Winter Olympics starting shortly. Hopefully USA hockey has a chance to avenge the Four Nations loss against Canada.
I have two cases this week, both involving an insurers petition to stay an underinsured/uninsured motorists arbitration.
Until next time,
Kyle
Kyle A. Ruffner
[email protected]
Never Heard of It – 100 Years Ago:
The Buffalo Times
Buffalo, New York
30 Jan 1926
What Is
Heathization?
Heathization is the science of keeping air out of food products. Being interested in the foods you eat, the following may be of interest to you:
Butter contains 10 per cent. of air by volume in imprisoned bubbles, and it is a recognized fact in the scientific world that it is this air content which is the cause of butter deterioration.
Air is very damaging to foods, especially when it is permanently sealed within the food mass. Air damages a bottle of preserved fruit. That is why our good housewives are so careful to seal it air tight. When you bite into an apple and expose the pulp to the air, the chemical action of air turns the apple brown very quickly.
Now heathization is the new science of keeping the air out of butter, and instead of air, a natural food atmosphere is employed. This atmosphere is a pure, dustless, sterile atmosphere called carbon dioxide and constitutes the atmosphere that occupies the bubble space in rising bread. Heathization imitates nature in protecting bread, butter and certain other forms of food from deterioration that arises by virtue of the air being incorporated.
Ryan’s Federal Reporter:
Hello Loyal Coverage Pointers Subscribers!
Well, I was taken aback about the Buffalo Bills firing their Head Coach, Sean McDermott. Time will tell whether that was the right move. All I know is that there is a new sheriff in town as Joe Brady was elevated from OC to HC after a quick flurry of coaching inquiries from the front office. Knowing that Josh Allen was in the room on making that decision, I am willing to give him the benefit of the doubt. But can we find a WR or two? PLEASE?
This edition, I have summarized a Second Circuit decision discussing some interesting trial evidence issues in the context of an assault claim. While the insured had claimed self-defense in the underlying action, the insured was not present at the bench trial for the direct action against the carrier—and that made all the difference.
Until next time…
Ryan
Ryan P. Maxwell
[email protected]
Number, Please – 100 Years Ago:
The Buffalo News
Buffalo, New York
30 Jan 1926
A NEW YORK man was awarded $495 damages in court because his name has been left out of the telephone book. But there’s no compensation for wrong numbers.
Storm’s SIU:
Hi Team:
One interesting digest for you this edition. A case I am handling for Adirondack Insurance Exchange is an evolving decision to watch. Among other issues, it addresses: if a named insured has a 50% interest in a property and protects the interest through an insurance policy which does not name the other owner, after a loss is the mortgagee listed on the policy limited in its recovery to the named insured’s 50% interest or may it recover 100% of the damages? We will find out. I’ll keep you apprised of developments as they occur.
Anyone sick of winter yet?!
Talk to you again in two weeks,
Scott
Scott D. Storm
[email protected]
Predicting WW II to Start No Later than 1941 (but not quite for the reasons suggested) – 100 Years Ago:
Durant Daily Democrat
Durant, Oklahoma
30 Jan 1926
SEES TROUBLE AHEAD
We read in a daily paper a prediction by Shaw Desmong, traveler and writer, that another world war is coming and is not at the most more than 15 years away. He says China’s 400,000,000 will unite with Japan’s 80,000,000. India’s 300,000,000 and at least 100,000,000 Moslems to lick the balance of the world. He declares such a movement is now taking form. We are not advising our friends to do any very great worrying over the gentleman’s prediction because worry will only help to bring on war. On the other hand, we would advise them to keep right on at work so they will at least not have to was on an empty stomach, if war does come. And maybe if a few more of Mr. Desmond’s type would try a little honest toll once and awhile they wouldn’t have time to bother the word with dire predictions.
Fleming’s Finest:
Hi everyone:
This edition’s case comes from the Pennsylvania Supreme Court. The court considered whether the plaintiff insurer as subrogee of its insureds had any right to recover amounts paid under the policy from the defendant insurer and whether its claim for “promissory estoppel” was actually a masked cause of action for spoliation of evidence not recognized in Pennsylvania.
As you know, there has been intense winter weather across the country. Hope you are all well and enjoy watching the Super Bowl. May the best team—my Patriots—win.
See you in a fortnight,
Kate
Katherine A. Fleming
[email protected]
E-mail Forecasted a Century Ago – 100 Years Ago:
The Rock Island Argus
Rock Island, Illinois
20 Jan 1926
BUSINESS WILL
BE CONDUCTED
THROUGH RADIO
Letters of Present to Become Ether
Waves of Future, Louisiana
Man Predicts.
New Orleans, La., Jan. 30. - In a short time, practically all correspondence carried on by business men will be handled by radio instead of by our post office system, says George S. Davis, known as the big boss of the Tropical Radio company, and vice president of the United Fruit company.
"The letter won't be mailed," says Davis. "It won't be telegraphed. It won't even be sent by radio as we send written messages today.
"It will be placed on a screen in a reproducing and sending apparatus and five minutes later that letter, complete with every dot of 'i' and crossing of 't'. and signature, will be delivered thousands of miles away.
"Drawings, documents and photographs will be sent this way around the world in an international system of communication swifter and more complete than the general public dreams possible.
"Radio transmission of X-ray photographs," Davis predicts, "will be a matter of daily routine within the next two years. Simplified X- ray outfits that can be used almost as easily as one uses a camera will be a part of the equipment of hundreds of steamships.
"Injured mariners, hurt in accidents aboard ship, can have their injuries X-rayed on board, and the X-ray picture sent by, wireless instantly to any Tropical Radio wireless station, when it will be placed before consulting specialists."
Davis' life has been devoted to wire and wireless communication, and it is upon the of his extensive knowledge of radio and visions of future development that he makes these predictions..
Gestwick’s Garden State Gazette:
Dear Readers:
It has been an interesting two weeks to be a Buffalo sports fan, to say the least. Was that a catch, an incompletion, an interception, or a fumble? The world will never know with any degree of certainty, as the officials neglected to review the play thoroughly. The result is not on the officials, though (i.e., don’t give up 10 points inside of two minutes in the first half, and that play doesn’t even matter). On a brighter note, where did these Sabres come from??
The case I have for you this week is technically a personal injury case, but with insurance coverage elements worth discussing. If a plaintiff has Personal Injury Protection (“PIP”) coverage, used some but not all of it, and declined a surgical recommendation at the outset, is she allowed to testify that she may have a future surgery at the time of trial? Read on to find out the answer.
That’s it for two weeks. Hopefully my fingers will thaw before I write to you again.
Evan
Evan D. Gestwick
[email protected]
Greenland’s Importance – 100 Years Ago:
Commercial
Bangor, Maine
30 Jan 1926
AN AMBITIOUS PLAN
Apparently the Canadian who proposes to eliminate the iceberg menace to shipping by reducing mountains of ice to water by means of chemical heat mines in Greenland is not dismayed by big undertakings.
If enough can be done, in carrying out the operation of the plan, to prevents icebergs escaping, a little more of the same treatment might be sufficient to convert Greenland from a region of “ice mountains” to a balmy clime. It is the ice which accumulates in that vicinity which gives the Arctic its reputation for being a repelling locality. If Greenland’s ice could be melted there would be no reason why the fields which shut off explorers from the Pole could not be disposed of in like manner, thus enabling ships to sail right to the spot where some claim to have been but may not have been.
The plan involves vast possibilities, provided it is feasible. That is the question. It is up to the physicist who suggests it to demonstrate its practicability.
O’Shea Rides the Circuits:
Dear Readers,
I hope everyone survived the nationwide chill and stayed warm this past week. While we avoided most of the cold, we still received about a foot or more of snow. Too bad, we previously got rid of our snowblower.
This week I discuss a case submitted by Thomas Hurney at JacksonKelly PLLC in Charleston, West Virginia. This matter involves the plain meaning of a Single Claim provision in excess policies with $100 million of additional coverage at stake. Tom, thank you for the suggested read. Tom can be reached Tom Hurney [email protected] or at 304-340-1346.
Until Next Time …
Ryan
Ryan P. O’Shea
[email protected]
Greenland is Part of Europe – 100 Years Ago:
Nebraska Legal News
Lincoln, Nebraska
30 Jan 1926
Greenland in Europe
America is usually, but not properly, understood to include Greenland. Although located close to the North American continent, Greenland is physically a part of Europe.
LaBarbera’s Lower Court Library:
Dear Readers:
My dog and I have a new delightful morning routine. One of us enjoys it much more than the other. While I keep hearing of dogs that rue the cold and snow, that is not the case with mine. The little one could spend all day out there if we let her, and oh does she try. She has made tracks, weaving through feet of snow in the backyard. So, what is our new morning routine? I spend at least ten minutes each morning, in the freezing crisp morning air, chasing her, begging her to come inside with me. I will leave it to you all to guess who is the one having the good time…
This week I am reporting on a case whereby the Petitioner filed a petition to vacate an arbitral award, awarded on default, after the Petitioner claims to have not received notice of the arbitration proceeding. Ultimately, the court found that the Petitioner failed to rebut the presumption of receipt and granted the cross-petition to affirm the arbitral award.
Isabelle
Isabelle H. LaBarbera
[email protected]
A Century Ago, Predicting Alexa! – 100 Years Ago:
The Sacramento Bee
Sacramento, California
30 Jan 1926
Music Situation
To Be Reversed
NEW YORK, Jan. 30. – David Sarnof, vice president of the Radio Corporation of America, makes the following prediction regarding the future of broadcasting:
“Thus far radio has sought its leading program features from the opera, the concert hall, the orchestra, and the stage.
“The day may come where the relationship will be reversed when the broadcasting station will comb the field of original talent; when broadcasting will create new reputations, instead of capitalizing old ones; when the opera, the stage or the concert hall will draw from radio in response to the demand of the public to see as well as to hear its favorite artists; when broadcasters will compete with music publishers for original compositions and not only buy but sell music publishing rights.”
Lexi’s Legislative Lowdown:
Dear Readers,
With the Holidays over, I do not have a lot going on – except, of course, my bowling league that “competes” every other Saturday and if you are wondering, yes, I will win the award for lowest overall score at the end of the season.
This week we discuss a bill that seeks to permit the photo enforced speed limit devices in work zones and maintenance areas on all state-controlled highways.
Thank you,
Lexi
Lexi R. Horton
[email protected]
I Don’t Think He Cared Much for His Wife – 100 Years Ago:
The Buffalo News
Buffalo, New York
30 Jan 1926
LEAVES WIFE SHILLING
“TO BUY RAT POISON”
DETROIT, Mich., Jan. 29. (U.P.) – Probate court officials were puzzled today over the will of James Thrope, who died here December 12, leaving most of his small estate to a brother and sister and “one shilling to my wife on condition she buy rat poison and drink it within six hours of receiving the money.”
Mrs. Edith Partington, the widow, is understood to reside in Wigan, Lancastershire, Eng. The will was dated Buffalo, N.Y., February 15, 1922.
Victoria’s Vision on Bad Faith:
Dear Readers,
I hope you’re all staying warm!
This week I have a case from the Second Department denying the Plaintiff’s motion for leave to amend its complaint against GEICO and law firm defendants to include a cause of action under the Judiciary Law to its complaint that alleges bad faith refusal to settle for the policy limits, breach of covenant damages, and punitive damages against GEICO in an underlying personal injury action.
Have a good weekend, and here’s to hoping Punxsutawney Phil doesn’t see his shadow on Monday.
Victoria
Victoria S. Heist
[email protected]
Predictions of the Consequences of a Word Court – 100 Years Ago:
The Bridley Herald
Gridley, California
20 Jan 1926
Predictions of the opponents of the world court, which the senate ratified Wednesday by a two-thirds vote, that the United States will be drawn into devastating wars through it, and be subject to unfair decisions by the court because of the majority membership being European is an echo of the warnings of the disastrous results that were to follow other epochal decisions by the congress in years gone by. The purchase of Louisiana was opposed; aid to the Central Pacific railroad was fought bitterly by so able a senator as Daniel Webster; “54:40 or fight” was the slogan on the Canadian boundary, and there was no fight; and the dolorous predictions of the opponents of the policies that finally were determined upon did not come to pass. The ship of state managed to ride fairly evenly, and the happiness and prosperity of the people increased.
Shim’s Serious Injury Segment
Hi Readers,
Looks like my picks were spot on during the divisional round of the NFL playoffs but the rest of my picks did not work out too well. But why quit at this stage of the game? Looking ahead to Super Bowl LX, we have a rematch of Super Bowl XLIX, which was Tom Brady’s fourth Super Bowl victory. This time, however, there will be new faces at the helm for New England with second-year quarterback Drake Maye and head coach Mike Vrabel in his first season coaching the team. As you may recall, Vrabel was a linebacker on three previous Super Bowl winning teams with the Patriots. The Seahawks are returning to the Super Bowl for the first time since their loss to the Patriots in Super Bowl XLIX. Although the "Legion of Boom" has since retired, Seattle’s current defense is not too shabby themselves.
I expect this game to be defense-first with both the Patriots’ and Seahawks’ defenses controlling the game. Who blinks first? I think the Seahawks do. Much to the disappointment of NFL fans outside of the New England area, the "Patriot Way" has been revived after a very short rebuild.
Final score prediction: 20-17, Patriots.
Half-time show predictions: Bad Bunny? More like bad performance. I expect this half-time show to be nothing short of horrible – bring back Rock and Roll.
In this column, I have shared a Kings County Supreme Court decision which denied defendants’ motions for summary judgment on the basis that plaintiffs failed to meet the “serious injury” threshold as defined by Insurance Law § 5102(d).
See you in the next issue!
Stephen
Stephen M. Shimshi
[email protected]
Will Radio Cause Clothing Lapses? – 100 Years Ago:
The Eugene Guard
Eugene, Oregon
30 Jan 1926
Radio Will not
Cause big Fall
In Sale of Suits
Comes a cry of complaint from the clothiers against the modern way of selling radios. Wearing scant clothing to meet that next installment on the radio set, is the way, people in Eugene, are going it, some merchants complaint. And then since radio keeps the family at home at night, there isn't the need for the fancy and evening gowns and soup 'n fishes, so they protest.
But there should be no such worry. For the installment payments will end soon, and so far as radio is concerned purchase of extra clothes will resume. Further, radio should encourage the purchase of extra clothes will resume.
Further, radio should encourage the purchase of evening clothes, rather than discourage it. For there are radio parties even today, and as there will be finer concerts, finer dance music in the air, the country may expect a reversion to the old practice of evening visits and parties.
North of the Border:
The Canadian winter of 2026 has been marked by snow, ice, and extreme cold. Parts of the country experienced wind chills of -50°C. At such temperatures, there is no difference between Fahrenheit and Celsius. Fortunately, the extreme cold has mostly subsided, and we are back to more typical winter temperatures. It is therefore fitting that this week’s column discusses a case where the dispute was whether the roof of a building under renovation and restoration collapsed due to snow load or frost heave.
Until next time,
Heather
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
Headlines from this week’s issue, attached:
KOHANE’S COVERAGE CORNER
Dan D. Kohane
[email protected]
- The Term “Interior Tile Work” in an Exclusion Is Ambiguous and Coverage Is Available for Preparatory Work
- A Worker in a Bucket Truck Is Occupying It, for Purposes of SUM Coverage. But Petition to Stay SUM Arbitration Was Untimely When Not Commenced Within 20 Days
- Does a Privity-Based Additional Insured Endorsement Satisfy an Insurance Procurement Requirement for Additional Insured Coverage? Question of Fact.
LIENING TOWER of PERLEY
Michael F. Perley
[email protected]
- Western District of New York Dismisses Putative Class Action Seeking Double Damages for No-Fault Benefits
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
- No cases this week.
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
- Removal Was Untimely, Settlement Demand Qualifies As “Other Paper”
RUFFNER’S ROAD REVIEW
Kyle A. Ruffner
[email protected]
- Petition to Stay Arbitration Denied, as Insurer Failed to Show Sufficient Evidence that Respondent Did Not Qualify as a Covered Resident Relative
- Petition to Permanently Stay Arbitration Granted, as Insured Did Not Obtain Consent from Insurer Prior to Settlement with Tortfeasor, which Prejudiced the Insurers’ Subrogation Rights
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
- Claimant’s Challenge to Trial Evidence Rulings Fails Due to Unexcepted Hearsay in the Insured’s Plea Allocation, Deposition Transcript, and Claim File
STORM’S SIU
Scott D. Storm
[email protected]
- An Evolving Case to Watch – If a Named Insured has a 50% Interest in a Property and Protects the Interest Through an Insurance Policy Which Does Not Name the Other Owner, after a Loss Is the Mortgagee Listed on the Policy Limited in Its Recovery to the Named Insured’s 50% Interest or May It Recover 100% of the Damages?
FLEMING’S FINEST
Katherine A. Fleming
[email protected]
- Subrogation Rights Limited to Damages for Which Insurer Paid Claims Under Policy. Promissory Estoppel Claim Not Properly Brought as Subrogee
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
- Appellate Court Vacates Trial Award Where Trial Court Allowed Testimony on Possible Future Surgery as Plaintiff Had Not Exhausted Personal Injury Protection Benefits
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
- Single Claim Provision that Contains Logically or Causally Related Language Bars Additional $100 Million in Coverage
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
- Court Affirms Arbitration Award, Finding Petitioner Failed to Rebut Presumption of Mailing
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
- Proposed Bill to Authorize the Use of Photo Speed Violation Monitoring in Construction or Maintenance Work Areas on All Highways
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
- Second Department Declines Plaintiff's Motion to Amend Complaint to Include a Cause of Action Under Judiciary Law 487(1)
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
- Kings County Supreme Court Denies Defendants’ Summary Judgment Motion on the Basis That Defendants’ Medical Experts Failed to Address Plaintiffs’ Alleged Head Injuries During Plaintiff’s IMEs
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
- The Application of an Exclusion in a Property Policy May Be Determined on a Summary Judgment Motion, But Expert Evidence Must Be Adduced by Affidavit, and Any Opposing Opinion Must Be Put to the Expert Through Cross-Examination on That Affidavit
I wish my friends and family at home warmer weather.
Hurwitz Fine P.C. is a full-service law firm providing legal services throughout the State of New York and providing insurance coverage advice and counsel in Connecticut and New Jersey.
In addition, Dan D. Kohane is a Foreign Legal Consultant, Permit No. 0119144, issued by the Law Society of Upper Canada, and authorized to provide legal advice in the Province of Ontario on matters of New York State and federal law.
NEWSLETTER EDITOR
Dan D. Kohane
[email protected]
ASSOCIATE EDITOR
Evan D. Gestwick
[email protected]
INSURANCE COVERAGE/EXTRA CONTRACTUAL LIABILITY TEAM
Dan D. Kohane, Chair
[email protected]
Steven E. Peiper, Co-Chair
[email protected]
Michael F. Perley
Agnieszka A. Wilewicz
Lee S. Siegel
Brian F. Mark
Scott D. Storm
Ryan P. Maxwell
Kyle A. Ruffner
Katherine A. Fleming
Evan D. Gestwick
Ryan P. O’Shea
Isabelle H. LaBarbera
Lexi R. Horton
Victoria S. Heist
FIRE, FIRST PARTY AND SUBROGATION TEAM
Steven E. Peiper, Team Leader
[email protected]
Michael F. Perley
Scott D. Storm
NO-FAULT/UM/SUM TEAM
Dan D. Kohane
[email protected]
Ryan P. O’Shea
[email protected]
Kyle A. Ruffner
[email protected]
APPELLATE TEAM
Jody E. Briandi, Team Leader
[email protected]
Topical Index
Peiper on Property and Potpourri
Lee’s Connecticut Chronicles
Ruffner’s Road Review
Gestwick’s Garden State Gazette
LaBarbera’s Lower Court Library
Lexi’s Legislative Lowdown
Victoria’s Vision on Bad Faith
KOHANE’S COVERAGE CORNER
Dan D. Kohane
[email protected]
01/29/26 Mt. Hawley Insurance Company v. Michelle Kuo Corp.
Appellate Division, First Department
The Term “Interior Tile Work” in an Exclusion Is Ambiguous and Coverage Is Available for Preparatory Work
Mt Hawley issued to Michelle Kuo Corp. (“Kuo”) an all-risk Commercial General Liability Insurance Policy and a Commercial Excess Liability Insurance Policy (collectively the Policy) in connection with construction work defendant was retained to complete, including the refurbishment of a bathroom. The Policy contains exclusions for property damage resulting from defendant's own labor and lists "interior tile" work as an exception to the exclusions.
During the construction of the bathroom, and in order to level and prepare the floor for tiling, defendant's laborer used welding equipment to secure a metal hatch door, which resulted in a fire causing property damage. Mr. Hawley denied coverage, taking the position that welding work was excluded from the Policy. Kuo maintains that the welding work was preparatory to the "interior tile" work, which is covered by the Policy.
Policy exclusions must be stated "in clear and unmistakable terms so that no one could be misled" . To avoid coverage pursuant to an exclusion, the insurer must establish that the exclusions or exemptions apply to the incident in question and are subject to "no other reasonable interpretation".
Here, the Policy fails to define "interior tile" work. Nor does it indicate the scope or extent of what constitutes "tiling work" or articulate whether the phrase was meant to encompass closely related preparatory tasks, which is a reasonable interpretation advanced by defendants. Accordingly, the Policy's exclusions and the "interior tile" exception is ambiguous. The record before us is conclusory and does not resolve these ambiguities. Well-settled "precedent require us to adopt the readings that narrow the exclusion" and construe ambiguities against the insurer plaintiff, resulting in coverage as a matter of law.
Court determines that Mt. Hawley has a duty to both defend and indemnify its insured for the claims.
01/28/26 Continental Casualty Company v. Anderson
Appellate Division, Second Department
A Worker in a Bucket Truck Is Occupying It, for Purposes of SUM Coverage. But Petition to Stay SUM Arbitration Was Untimely When Not Commenced Within 20 Days
This was an Article 75 proceeding to permanently stay supplemental uninsured/underinsured motorist(SUM) arbitration.
In February 2019, Anderson was working in the bucket of a utility truck owned by his employer and insured by Continental when it was struck by a hit-and-run vehicle and Anderson allegedly was injured. Anderson's employer allegedly refused to provide its insurance information, and eventually the information was disclosed at a hearing held on January 11, 2022.
On January 13, 2022, Anderson's attorney faxed the petitioner a notice of intention to make a claim for uninsured/underinsured motorist benefits. On January 19, 2022, Anderson served the petitioner with a demand for arbitration of a supplemental uninsured/underinsured motorist (hereinafter SUM) claim. In September 2022, the petitioner commenced this proceeding pursuant to CPLR article 75, inter alia, to permanently stay arbitration of Anderson's claim. The Supreme Court denied the petition and dismissed the proceeding as untimely. The petitioner appeals.
"CPLR 7503(c) requires a party, once served with a demand for arbitration, to move to stay such arbitration within 20 days of service of such demand, else he or she is precluded from objecting" Here, the proceeding was not commenced within 20 days of the notice of the demand for arbitration. "In order for the 20-day limitation period to be enforceable, the notice of intention to arbitrate must comply with the requirements of CPLR 7503(c).
However, where a petition to stay arbitration is made on the ground that no agreement to arbitrate exists, the 20-day time limitation in CPLR 7503(c) does not apply. This Court has determined that the 20-day limitation period does not bar review of the question of whether the person seeking coverage was an insured under the policy, reasoning that if the person claiming coverage under the insurance policy is not an insured, then no agreement to arbitrate existed. Thus, the petitioner was not precluded from raising the defense that Anderson is not an insured under the policy.
The SUM endorsement in the petitioner's policy defined "insured" to include any person "occupying" the insured vehicle. Consistent with the statutory requirement, "occupying" was defined to mean "in, upon, entering into or exiting from a motor vehicle". In accordance with the liberal interpretation afforded the term "occupying" Anderson, who was inside of the bucket of the utility truck when it was struck, was, as a matter of law, "in" or "upon" the insured vehicle and "occupying" it within the meaning of the SUM endorsement when the accident.
Other objections to the petition were denied as untimely.
01/22/26 Garcia v. CityMeals-On-Wheels Property, LLC
Appellate Division, First Department
Does a Privity-Based Additional Insured Endorsement Satisfy an Insurance Procurement Requirement for Additional Insured Coverage? Question of Fact
Garcia was performing asbestos remediation work on the rooftop of a warehouse owned by defendant CityMeals-On-Wheels Property, LLC, (“CityMeals”) standing with his back to a polyurethane sheeting barrier that was erected along a parapet wall at the roof's perimeter. As plaintiff stood about 3½ meters away, a strong gust of wind toppled the sheeting barrier, causing its components, including a 50-pound metal paraclamp and vertical wooden support pieces, to strike the back of plaintiff's head and neck, rendering him unconscious.
Plaintiff established prima facie entitlement to summary judgment on liability on his Labor Law § 240 claim, as the sheeting barrier presented a gravity-related hazard.
In opposition to plaintiff's prima facie showing, defendants failed to raise a triable issue of fact.
Incinia, the subcontractor that employed plaintiff, sought to dismiss the third-party complaint by defendants/third-party plaintiffs CityMeals and Hollister Construction Services, Inc. (the construction manager) for breach of Incinia's contractual obligation to procure additional insured coverage for CityMeals and Hollister.
In brief, it is undisputed that Incinia's commercial general liability (CGL) carrier, nonparty Evanston Insurance Company, has rejected CityMeals' and Hollister's tender of their defense in this action. Indeed, Incinia has commenced a separate action against Evanston, seeking a declaration that CityMeals and Hollister are covered as additional insureds under Incinia's policy with Evanston.
Until the declaratory judgment action against Evanston (now pending in federal court) is resolved, it cannot be determined whether Incinia fulfilled its contractual obligation to procure coverage for CityMeals and Hollister.
As a nonparty to the present action, Evanston will not be bound by any coverage determination made herein. However, once the federal declaratory judgment action is resolved, it will be known whether Incinia procured coverage as required by its subcontract. Under these circumstances, the grant of summary judgment dismissing the third-party complaint against Incinia was premature.
Incinia argues that the endorsement to its Evanston CGL policy excluding from coverage liability for bodily injury to an employee "of the Named Insured [i.e., Incinia] arising out of and in the course of . . . [e]mployment by the Named Insured" does not bar coverage of CityMeals and Hollister because the endorsement further provides that "[t]his exclusion does not apply to liability assumed by the Insured under an 'insured contract.'" However, the policy's CGL coverage form defines the term "insured contract," in relevant part, as an agreement "under which [Incinia] assume[s] the tort liability of another party to pay for 'bodily injury' . . . to a third person or organization."
Thus, while the bodily injury exclusion does not apply to Incinia's contractual obligation to indemnify CityMeals and Hollister in this action, the exclusion still potentially bars coverage for direct liability to an injured employee of Incinia, which is not liability "under an 'insured contract.'"
As to the additional insured endorsement requiring that Incinia's obligation to provide additional insured coverage be set forth in "[a] written contract . . . signed by both parties and executed prior to the commencement of operations" (the signing requirement), it cannot be determined on this record whether the placement of such a condition on additional insured status complied with Incinia's insurance procurement obligations under its subcontract. The subcontract requires that CityMeals and Hollister be included as CGL additional insureds using specified additional insured endorsement forms "or an endorsement providing equivalent coverage to the additional insureds." The present record does not reveal whether the additional insured endorsement form used in the Evanston policy provided coverage "equivalent" to the coverage that would have been provided by the forms specified in the subcontract.
LIENING TOWER of PERLEY
Michael F. Perley
[email protected]
01/08/26 Claims v. Merchants Mutual Insurance Company
United States District Court, Western District of New York
Western District of New York Dismisses Putative Class Action Seeking Double Damages for No-Fault Benefits
Section 111 of the Medicare Secondary Payer Act (the “MSPA”) (42 U.S.C. §1395y(b)(8)) requires that no-fault carriers, defined as “primary payers” under the Act, reimburse either Medicare or Medicare Advantage Organizations (MAOs) for payments it made as a purported “secondary payer” to beneficiaries who had not filed for reimbursement under the New York No-Fault Law.
In the case Merchants issued automobile no-fault insurance policies to certain Medicare beneficiaries that received Medicare benefits through MAOs. These individuals were allegedly injured in motor vehicle accidents for which coverage for treatment was available under the New York No-Fault Law. For reasons that were never explained billing for some treatment was sent to the MAOs and were paid under that coverage. At some point MSP Recovery Claims Series LLC (MSP), a company that purchases potential reimbursement claims in bulk from certain MAOs, commenced a putative class action against the insurer claiming that the insurer owes them reimbursement for payments made for medical care provided to the insured’s policy holders under New York No-Fault Coverage. Significantly, all of these individuals ultimately filed for, and received no-fault benefits for injuries arising out of the same accident. As required by the MSPA, Merchants duly notified each MAO of the claim. The MAOs took no action. Thus, it was not until MSP purchased the “book” of claims that the issue was brought to Merchants’ attention.
This matter, pending since 2018 had been dismissed for lack of standing with leave to amend. Upon receipt of the amended complaint, Merchants moved for dismissal under F.R.C.P. 12(b)(1) and 12(b)(6). A decision on the standing motion was deferred until after the determination by the Second Circuit in MSP Recovery Claims Series LLC v. Hereford Insurance, 66 F. 4th 77 (2022, finding that MSP lacked standing). Although the Merchants’ complaint was remarkably similar, if not identical to the complaint in Hereford, the court denied the 12(b)(1) standing motion and ordered additional briefing on the 12(b)(6).
On the 12(b)(6) motion, Hurwitz Fine, on behalf of Merchants, argued that the Medicare Secondary Payer Act (“MSPA”), and the regulations promulgated thereunder do not preempt the claims filing provisions of its no-fault insurance policies, and, in fact require that no-fault beneficiaries comply with “conditions precedent to the right to payment under the policy” that are incorporated into no-fault policies in New York (see 42 CFP 411.51.Thus MSP failed to state a cause of action because it did not, and could not, allege that they (or anyone else) submitted claims for payment to insurer within the time frames required by the regulations applying the New York No-Fault Law, or otherwise try to coordinate benefits.
MSP argued that 42 CFR 411.24(f)(1), promulgated under the MSPA preempted the claims filing requirements and time limitations incorporated into New York’s no-fault insurance statutes, regulations and policies, On behalf of Merchants, we pointed out to the Court that the regulation relied on by MSP had been annulled by Federal courts in the 11th Circuit in 1993 and, citing 42 CFR 411.51 demonstrated that compliance with state law requirements in applying for no-fault benefits was necessary to preserve MSPA recovery rights.
In a Report and Recommendation adopted by the District Jude, the U.S. Magistrate Judge for the United States District Court for the Western District of New York held that where New York No-Fault insurance laws and regulations are at issue, a no-fault insurer cannot owe any payment if the “eligible injured person” (i.e. the insured) or “that person’s assignee or representative” (i.e. the medical treatment provider) does not “submit written proof of claim to the Company, including full particulars of the nature and extent of the injuries and treatment received and contemplated” (i.e. an invoice for medical treatment and accompanying treatment notes) “as soon as reasonably practicable but, in no event later than 45 days after the date services are rendered.” Absent any factual allegation that the beneficiary or medical provider filed a timely claim, it is not plausible that the insurance carrier “has or had a responsibility to make payment” pursuant to the underlying statutory or contractual obligation (i.e. New York’s No-Fault Law and its regulations) for the items or services for which the MAO now claims reimbursement.
Obviously, New York’s notice requirements are singular to that state, however, compliance with no-fault notice requirements can be a significant factor in resisting MSPA claims.
Editor’s Note: As there is no public link for this case, if you would like a copy, please email [email protected].
PEIPER on PROPERTY (and POTPOURRI)
Steven E. Peiper
[email protected]
No cases this week.
LEE’S CONNECTICUT CHRONICLES
Lee S. Siegel
[email protected]
01/20/26 Sweetman v. Ehran
United States District Court, Connecticut
Removal Was Untimely, Settlement Demand Qualifies as “Other Paper”
Although not specifically an insurance coverage decision, removing cases to federal court is an important tool for lawyers representing insurers and defending insureds. As my law school civil procedure professor said so many years ago about federal court: smarter judges, better bathrooms. That advice stayed with me 30 years later and has largely proven to be true, especially the part about the bathrooms.
So, preserving the right to remove is important and one of the most critical elements is timing. Under 28 USC § 1446(b), you have 30 days to remove from receipt of the initial pleading or 30 days upon receipt of “other paper” from which removability is first ascertainable (assuming the case was not originally removable).
Here, Sweetman sued Ehran and other non-Connecticut defendants in Connecticut state court for injuries sustained in a trucking accident. The defendants removed and plaintiff brought this motion to remand, arguing that removal was untimely.
Plaintiff sent a pre-suit settlement demand to the defendant in November 2024, asking for the full insurance which plaintiff surmised was at least $750,000 under the MCS-90. No one responded. Plaintiff brought suit in January 2025. No one appeared. In April, plaintiff’s counsel sent a copy of the summons and complaint to attorneys representing the defendants (how counsel knew this information is unclear from the opinion). The attorneys communicated on May 20, 2025, with confirmation of insurance coverage exceeding one million dollars.
On that day, plaintiff’s counsel wrote to defense counsel pointing out that he had demanded the limits in November 2024, that the demand was at least $750,000, and therefore defendants cannot claim “you thought our demand was below the jurisdictional limit of the federal court…” The email threatened to seek sanctions and costs for an improper removal. Defendants did not remove but instead filed a motion to dismiss in state court, which was denied.
In August 2025, plaintiff produced medical discovery showing bills of almost $50,000 and serious injuries. In September 2025, plaintiff filed a $735,000 offer of compromise. Only then, in October 2025, did the defendants remove the case to federal court.
Plaintiff argued that the removal clock began upon commencement of the action 10 months prior, that the settlement demand and correspondence in May could also be seen as starting the 30-day period, or the court could look to the August discovery responses, that the offer of compromise added no additional weight, and that in any event the defendants elected to defend the case in state court.
The defendants countered that pre-complaint communication are irrelevant, settlement demands are not “other papers,” the medical discovery did not establish removability, defending the case in state court is irrelevant, and only the offers of compromise triggered the removal countdown.
The court completely disagreed with the defendants. “If they had [received the November 2024 settlement demand], the case would have been removable when served on the Defendants.” Further, the court held that there was no dispute that by May 2025 the defendants were aware of the plaintiff’s settlement demand.
Importantly, while the Second Circuit has not opined on whether pre-suit settlement communications are “other paper,” at least three Connecticut district courts circuits have held that other papers must be received after service of the complaint. Nevertheless, the court disagreed with the conclusion that the settlement demands failed to put the defendants on notice of the amount in controversy. “I agree with the Fifth Circuit's Chapman decision to the extent it recognizes that "other paper" in section 1446(b)(3) necessarily refers to papers filed or served after the defendant receives the initial pleading. However, I disagree with Chapman, and the district courts following Chapman, to the extent that it refuses to recognize the ability of pre-suit demands to put defendants on notice that the amount in controversy exceeds $75,000.”
The court concluded that the defendants knew the case was removable upon service and, assuming they had not received the pre-suit demands, and no later than May 2025 when the demands were repeated. To reach this decision, the court reasoned that settlement demands and communications qualify as “other papers.” Also, the court rejected the notion that “other paper” must be served in hard copy—clearly other paper can be emails or other formats. “Requiring "other papers" to include only hard copies is at odds with technological advances such as e-filing.”
In the end, the court refused to award fees, costs, or sanctions. Noting the remand presented a procedural issue about which the law is unclear, the removal was not “objectively unreasonable.”
RUFFNER’S ROAD REVIEW
Kyle A. Ruffner
[email protected]
01/21/26 Matter of Allstate Fire & Cas. Ins. Co. v Rios
Appellate Division, Second Department
Petition to Stay Arbitration Denied, as Insurer Failed to Show Sufficient Evidence That Respondent Did Not Qualify as a Covered Resident Relative
Defendant Rios allegedly was riding her bicycle when she collided with the door of a motor vehicle. She submitted a demand to arbitrate her claim for supplemental underinsured motorist benefits under the policy of her domestic partner’s father. The petitioner commenced this proceeding to permanently stay the arbitration, which was granted by the Supreme Court.
The party seeking a stay of arbitration has the burden of showing the existence of sufficient evidentiary facts to establish a preliminary issue which would justify the stay. Matter of AutoOne Ins. Co. v Umanzor, 74 AD3d 1335, 1336; see Matter of Country-Wide Ins. Co. v Adams, 187 AD3d 1013, 1013-1014; Matter of Government Empls. Ins. Co. v Tucci, 157 AD3d 679, 680). The burden then shifts to the party opposing the stay to rebut the prima facie showing. The Court further emphasized that, where a triable issue of fact is raised, the Supreme Court, not the arbitrator, must determine it in a framed-issue hearing, and the appropriate procedure under such circumstances is to temporarily stay arbitration pending a determination of the issue.
Here, the petitioner failed to meet its initial burden of showing the existence of sufficient evidentiary facts to establish a preliminary issue which would justify the stay. The petitioner argued that it was clear and unambiguous that Rios did not qualify as a covered "resident relative" under the policy, however, it did not attach the policy or relevant portions in support of its petition. The rights or obligations of parties under insurance contracts are based on the specific language of the policies. Accordingly, the Appellate Court held the Supreme Court erred in granting that branch of the petition to permanently stay arbitration because the petitioner failed to meet its initial burden. Further, contrary to the petitioner's contention, it was not entitled to a framed-issue hearing, as it failed to meet its prima facie burden justifying a stay.
01/14/26 Matter of Progressive Cas. Ins. Co. v Lai (2026 NY Slip Op 00134)
Appellate Division, Second Department
Petition to Permanently Stay Arbitration Granted, as Insured Did Not Obtain Consent From Insurer Prior to Settlement With Tortfeasor, Which Prejudiced the Insurers’ Subrogation Rights
The respondent allegedly sustained injuries in a two-car accident. Their Progressive auto policy, which included a supplementary uninsured/underinsured motorist endorsement, contained an exclusion which provided that SUM coverage did not apply to an insured's bodily injury if the insured or the insured's legal representatives, "without our written consent, settles any lawsuit against any person or organization that may be legally liable for such injury." Condition 9 of the endorsement provided that if the insured settles with any negligent party for the available limit of the motor vehicle bodily injury liability coverage of such party, release may be executed with such party after 30 days from our receipt of your written notice to us. Further, the endorsement specified that an insured “shall not otherwise settle with any negligent party, without our written consent, such that our rights would be impaired.”
Following the accident, the respondent commenced an action against the owner and the operator of the other vehicle and later advised Progressive that she had settled the action for $100,000, the limit of the tortfeasors' policy. Progressive disclaimed coverage on the ground that the respondent had signed a release of her claims against the tortfeasors without its written consent. The respondent then demanded arbitration of her claim for SUM benefits, and Progressive commenced this proceeding to permanently stay arbitration, which the Supreme Court denied. On appeal, the Court noted that the question of arbitrability is an issue generally for judicial determination in the first instance. Contrary to the respondent's contention, an arbitration clause in the policy cannot be read to cover the issue of whether coverage exists due to the claimed applicability of a policy exclusion. Rather, the only arbitrable issues were whether the respondent was entitled to recover from the uninsured/underinsured motorist and the amount of damages recoverable under the SUM endorsement.
Where an automobile insurance policy expressly requires the insurer's prior consent to any settlement by the insured with a tortfeasor, failure of the insured to obtain such prior consent from the insurer constitutes a breach of a condition of the insurance contract. "When an insured settles with a tortfeasor in violation of a condition requiring his or her insurer's written consent to settle, and fails to preserve the insurer's subrogation rights, the insurer is prejudiced, and the insured is precluded from asserting a claim for underinsured motorist benefits" Matter of Travelers Home & Mar. Ins. Co. v Kanner, 103 AD3d 736, 738. Therefore, the failure to obtain such consent disqualifies the insured from the pertinent benefits of the policy, unless the insured can demonstrate that the insurer waived the requirement of consent.
Here, the existence of a release in settlement of the tort claim was established, so the burden was on the insured to establish that the release did not operate to prejudice the subrogation rights of the insurer. However, the respondent failed to demonstrate that Progressive waived the requirement of consent or acquiesced in the settlement by conduct, silence, or unreasonable delay. Further, respondent failed to establish that the settlement and release did not operate to prejudice Progressive's subrogation rights. Accordingly, the Appellate Court held that the Supreme Court should have granted the petition to permanently stay arbitration.
RYAN’S FEDERAL REPORTER
Ryan P. Maxwell
[email protected]
01/26/26 Bunnenberg v. Liberty Mutual Fire Insurance Company
Second Circuit Court of Appeals
Claimant’s Challenge to Trial Evidence Rulings Fails Due to Unexcepted Hearsay in the Insured’s Plea Allocation, Deposition Transcript, and Claim File
This case involved in alleged assault where the insured purportedly struck the claimant without provocation. The insured was charged and ultimately pled her charges down to a misdemeanor. The claimant ultimately filed a tort lawsuit in New York state court, and a settlement was made, but not before Liberty Mutual Fire Insurance Company disclaimed coverage due to its insured’s alleged intentional acts. While the insured claimed to have acted in self-defense or otherwise unintentionally in striking the claimant, the settlement laid any need to make such arguments aside, while limiting any potential recovery of settlement proceeds to what the claimant could recover from Liberty.
Following the settlement, the claimant ultimately filed suit against Liberty to recover the settlement proceeds. And after a bench trial in the claimant’s direct action against Liberty, the District Court concluded that no coverage was owed due to the insured’s intentional assault of the claimant. At the bench trial, the insured was never called as a witness, and the court found the claimant’s testimony—which deviated from her deposition testimony in the underlying action—lacked credibility. The claimant appealed.
This appeal concerned several evidentiary rulings at the time of the bench trial. Specifically, the Court had precluded from evidence the insured’s deposition transcripts and other statements made by the insured during the course of her criminal proceedings, in addition to Liberty’s claim notes regarding this particular claim.
Relative to the insured’s plea allocution during her criminal proceeding, the Second Circuit found those statements to be hearsay, in that they were out of court statements offered to prove the truth of the matter asserted, and no hearsay exceptions applied.
First, Fed. R. Evid. 803(22) was found in applicable because that permits only admission of evidence of a final judgment of conviction for a crime punishable by death or by imprisonment for more than one year. Neither the reckless assault or harassment to which the insured played guilty were punishable by imprisonment for more than one year, and the claimants attempt to stack the maximum sentences of the misdemeanor counts together was found lacking. Additionally, statements made at a change of plea hearing were not evidence of a final judgment of conviction.
Second, the exception for an unavailable witness under rule 804 was found not to have been supported by the evidence submitted. As the District Court had concluded, the claimants only attempt to secure the insured’s attendance was through a subpoena issued mere weeks before trial. There was no further information submitted as to whether the insured had been contacted by the claimant for purpose purposes of providing testimony, and it was clear to the Court that the claimant had failed to explore other reasonable means available to her to secure the insured’s testimony, including potentially asking the insured to voluntarily appear. Additionally, the statements made by the insured during her plea allocution were made to minimize her culpability and were thus self-serving rather than against penal interest.
Third, the residual exception in rule 807 to the insured’s plea allocation was inapplicable. 807 excepts a hearsay statement supported by sufficient guarantees of trustworthiness that is more probative on the point for which it is offered than any other evidence that the offer can be obtained through reasonable means provided that the opposing party receives reasonable notice. Not only were reasonable efforts lacking in the evidence submitted by the claimant, but no reasonable notice was provided to Liberty about use of such materials prior to trial. Additionally, the insured’s statement in her apology that she “never meant to hurt the claimant” was self-serving and not sufficiently trustworthy. This apology was conditioned to bring the insured one step closer to expunging a misdemeanor conviction.
Beyond these statements by the insured in her criminal proceedings, the claimant was also precluded from offering the insured’s testimony from the underlying case. Not only did the claimant fail to establish that the insured was unavailable for testimony trial, but a deposition from a prior action can only be introduced into evidence in a later action involving the same subject matter between the same parties or their representatives or successor in interest. Here Liberty neither represented the insured nor served as the insured’s successor in interest during the claimant’s direct action. In other words, Liberty’s interests were not protected as part of the insured’s original underlying deposition, where the insured was attempting to avoid liability by portraying her actions as either self-defense or unintended. The insured’s counsel in the underlying case was no substitute for an attorney protecting Liberty’s interests.
Finally, relative to Liberty‘s claim notes, the Second Circuit found that statements made by a Liberty claims professional regarding information provided by an attorney representing the insured regarding what the insured herself had said—quite a mouthful—constituted impermissible, triple hearsay.
….Okay, maybe one more thing. The claimant also argued that the District Court had failed to make a missing witness charge. This argument was found to be a bit perplexing because the matter was tried by bench trial without a jury. A missing witness charge intended to instruct a jury as to what inferences it could draw had no application to the issue before the District Court. There was no need for judge to have instructed herself.
Maxwell‘s Minute: I should note that while the court found that the underlying deposition transcripts could not be used by the claimant in the direct action, this same logic would not preclude an insurer in Liberty‘s position from relying upon the underlying deposition transcripts. Those transcripts establish the parties’ respective factual positions in the underlying case, and the claimant in a direct action was represented for purposes of that action in furtherance of her interest in recovering for injuries sustained.
STORM’S SIU
Scott D. Storm
[email protected]
01/15/26 Adirondack Insurance Exchange v. HSBC Bank, et al
United States District Court, Northern District of New York
An Evolving Case to Watch – If a Named Insured Has a 50% Interest in a Property and Protects the Interest Through an Insurance Policy Which Does Not Name the Other Owner, After a Loss Is the Mortgagee Listed on the Policy Limited in Its Recovery to the Named Insured’s 50% Interest or May It Recover 100% of the Damages?
In an action I am handling for Adirondack, it seeks a declaratory judgment regarding its obligations to its insured (Bresler) and/or the mortgagee on the policy (HSBC) after a fire at a residential property owned by Bresler and Stohr encumbered by a mortgage held by HSBC. Both Bresler and Stohr are debtors on the mortgage.
Bresler and Stohr divorced years ago and Stohr moved out of the property establishing a residence elsewhere. Bresler secured the policy with Adirondack in his name only. Stohr maintained her own separate policy on the property but allowed it to lapse. Pursuant to the divorce agreement, Bresler had a right to reside in the property and when he eventually moved out, the property would be sold and the proceeds, if any after the mortgage was paid, were to be split between Bresler and Stohr. However, the mortgage was not paid, and HSBC commenced a separate State Court foreclosure action. The property burned. The balance of the mortgage exceeds the amount of the damage to the property.
Adirondack asserts the position that Stohr’s interest in the property is not insured under its policy as she was neither a named insured nor did she qualify as an “insured” as defined in the policy. Adirondack’s policy was issued solely to Bresler. As such, it asserts that Bresler’s recovery under the policy is limited to 50%, his interest in the property. Furthermore, it asserts that HSBC, as mortgagee on the policy, may not recover more than Bresler’s 50% interest in the property. Because New York law prioritizes the mortgagee’s interest over the mortgagor’s, Adirondack argues that the 50% interest in the property it insures must be paid to HSBC.
Bresler and HSBC both allege an exclusive right to 100% of the damages under the policy. HSBC and Adirondack filed motions for summary judgment on the distribution of insurance proceeds.
Adirondack requested that the court issue an order finding that: (1) Stohr has no right of recovery under the policy; (2) Bresler’s insurable interest under the policy is limited to his interest in the property, which is 50% of the value of the damage under Coverage A – Dwelling; (3) Bresler is precluded from recovery under the policy as HSBC Bank, as mortgagee, has a superior right of recovery over Bresler and the amount owed on the mortgage is greater than the amount of recovery under the policy; and (4) HSBC’s interest under the policy may not exceed the interest of the named insured Bresler and, therefore, it is limited in its recovery under the policy to 50%.
HSBC and Bresler have been litigating the foreclosure action in New York State Court. While the federal court motions were pending, the Appellate Division, Third Department affirmed dismissal of HSBC’s state foreclosure action based on the retroactive application of the Foreclosure Abuse Prevention Act (FAPA), prompting Bresler to assert that HSBC no longer holds a valid mortgage or right to recover under the policy. HSBC responded that it retained an insurable interest in the property on the date of loss and alternatively urged the federal court to await forthcoming decisions from the New York Court of Appeals and the Second Circuit regarding FAPA’s constitutionality.
On 11/25/25, in Article 13 LLC v. Ponce De Leon Fed. Bank, the New York Court of Appeals held that FAPA’s retroactive application does not violate the New York State Constitution’s due process protections, while the Second Circuit continues to consider FAPA’s constitutionality under the U.S. Constitution.
Citing its inherent authority to control its docket and to stay proceedings for judicial economy, the federal court referred to various case precedents. Assessing the parties’ and public interests, the federal court found a stay of this action warranted pending the Second Circuit’s decision in Article 13 LLC because that decision may directly affect the legality of HSBC’s foreclosure and the insurable-interest issues central to the insurance proceeds dispute.
The court found all factors favored staying this insurance dispute because a short-term stay pending the Second Circuit's FAPA decision was unlikely to adversely impact parties, would conserve resources, and the public interest did not counsel a different result.
The power to stay proceedings is incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants. A federal district court has the inherent power, in the exercise of its discretion, to stay an action. Accordingly, the decision to issue a stay is firmly within a district court's discretion. A court may decide in its discretion to stay civil proceedings when the interests of justice seem to require such action. A court may determine that a stay is appropriate and in the interest of judicial economy, pending the outcome of proceedings which bear upon the case, even if such proceedings are not necessarily controlling of the action that is to be stayed.
There are five factors that the court should consider when deciding whether to exercise its discretion to enter a stay: (1) the private interests of the plaintiffs in proceeding expeditiously with the civil litigation as balanced against the prejudice to the plaintiffs if delayed; (2) the private interests of and burden on the defendants; (3) the interests of the courts; (4) the interests of persons not parties to the civil litigation; and (5) the public interest.
More to come…
FLEMING’S FINESTa
Katherine A. Fleming
[email protected]
01/21/26 Erie Ins. Exch. v. United Servs. Auto. Ass’n.
Pennsylvania Supreme Court
Subrogation Rights Limited to Damages for Which Insurer Paid Claims Under Policy. Promissory Estoppel Claim Not Properly Brought as Subrogee
Erie Insurance Exchange (“Erie”), as subrogee of Bates Collision, Inc. (“Bates”), James Myers, Anita Morgan, Lossie Auto Service and Benedictine Sisters of Erie, Inc. (collectively the “insureds”), commenced an action against United Services Automobile Association (“USAA”). A fire occurred at Bates that resulted in significant damage to Bates and several vehicles in the shop. Erie insured Bates and the vehicles inside the shop, and it paid the claim pursuant to a policy that permitted Erie to seek reimbursement for its payment. Erie suspected that a BMW was to blame for the fire, alerted USAA, the BMW’s insurer, of its potential subrogation claim, and took steps to preserve the evidence. After a joint inspection of the BMW, Erie emailed USAA and USAA’s expert to confirm that USAA took possession of the BMW and that it would be secured and preserved. USAA responded with the location and phone number for Insurance Auto Auction (“IAA”), where the BMW was towed and stored, and explained that they had required the vehicle be wrapped and preserved for potential investigation. IAA then sold the BMW at a salvage auction.
Erie sought reimbursement for payment made to its insureds following the fire because USAA failed to preserve the vehicle Erie believed to be critical evidence and the culprit of the fire. As subrogee, Erie brought one count of promissory estoppel against USAA, alleging that due to USAA’s alleged failure to abide by its verbal and written commitments and promises, Erie was unable to pursue a claim against the manufacturer of the vehicle, the owner of the vehicle or anyone else because the vehicle was not preserved. USAA maintained that it was the negligence of Bates that caused the fire, and since it did not cause the property damage for which Erie was contractually obligated to pay its insureds, subrogation principles did not apply to Erie’s claim. USAA also asserted that the promissory estoppel claim was really a cause of action for spoliation, which does not exist in Pennsylvania. The trial court agreed with USAA that the promissory estoppel cause of action was the equivalent of a claim for negligent spoliation of evidence. The trial court further concluded that Erie’s subrogation claim failed as a matter of law because USAA did not cause the property damage. The Superior Court reversed the trial court’s order granting summary judgment in favor of USAA, finding that the underlying facts set forth in Erie’s complaint provided for the possible recovery of damages based upon promissory estoppel. The appellate court did not address the alternative holding that Erie could not pursue a promissory estoppel case of action as subrogee of its insureds.
The Pennsylvania Supreme Court considered whether Erie as subrogee of its insureds had any right to recovery against USAA and whether its claim for “promissory estoppel” was actually a masked cause of action for spoliation of evidence not recognized in Pennsylvania. As Erie brought the suit as subrogee of its insureds, its subrogation rights to recovery were limited to the fire damages for which Erie paid the insureds under the policy. However, the Court noted that the claim against USAA for preventing Erie from pursuing its subrogation claim was a loss distinct from the loss caused by the fire. As a result, the policy’s language did not contemplate seeking recovery as subrogee from anyone else held responsible for other torts besides the fire loss. For the promissory estoppel claim, the Court held that Erie could not pursue the claim as subrogee for the amounts it paid its insureds as it was not alleged that the insureds relied on the promise by USAA to Erie. The Court noted the error in bringing the lawsuit as subrogee and expressed no opinion on the viability of a promissory estoppel claim brought by an insurance carrier—not as subrogee—against a party allegedly responsible for foreclosing its pursuit of subrogation rights as a result of that party’s failure to preserve the evidence necessary to prove who was responsible for the loss it paid to its insureds.
GESTWICK’S GARDEN STATE GAZETTE
Evan D. Gestwick
[email protected]
01/16/26 Terrell v. Chitra
Superior Court of New Jersey, Appellate Division
Appellate Court Vacates Trial Award Where Trial Court Allowed Testimony on Possible Future Surgery as Plaintiff Had Not Exhausted Personal Injury Protection Benefits
Terrell and Chitra were involved in an automobile collision on August 6, 2018, where Terrell sustained severe injuries to her neck, cervical and lumbar spine, and right shoulder. Following the accident, Terrell began treating with several physicians, including an orthopedic surgeon who recommended a disc replacement and possible fusion surgery in 2019 and again in 2020. Each time, Terrell declined to undergo surgery, citing the risks and her profession as a nurse as reasons.
During the course of discovery, Terrell revealed that she had a Personal Injury Protection (“PIP”) limit of $250,000 under her own auto policy at the time of the accident. Terrell also produced a PIP ledger, indicating that she had received $11,810.31 out of this limit for her various medical bills incurred as a result of the accident. Plaintiff was also deposed in the case, where she again indicated that she would not proceed with the recommended surgeries.
At the time the case was set for trial, Terrell still had approximately $238,000 in unspent PIP benefits. For that reason, Chitra moved to preclude Terrell’s medical expert from testifying about Terrell’s future medical costs. Chitra argued that discovery revealed that Terrell had no intention of proceeding with surgery, and that there was no reason to believe future costs would be incurred. Chitra also argued that Terrell’s remaining PIP coverage was a collateral source from which Terrell could draw to pay for any such future surgery. Initially, the trial court granted Chitra’s motion to preclude, not on the basis that Terrell’s remaining PIP coverage was a collateral source to recovery, but on the basis that there was no evidence that Terrell would eventually have the surgery, and because Terrell’s expert was not a competent witness to testify to the cost of any future surgery.
The trial then proceeded with testimony, first from Terrell, where she indicated that her life circumstances had changed such that she was now open to considering the surgeries. At the close of all testimony, Terrell made an oral motion to reconsider the Court’s prior ruling, precluding testimony on Terrell’s future medical costs. The trial court granted this motion on the basis that any verdict for future medical expenses could be reduced if Terrell’s PIP carrier actually paid for the surgery. After Terrell offered testimony from her expert on the cost of her future surgery, the jury awarded $1,000,000 in pain and suffering, and an additional $300,000 for future medical expenses.
Chitra appealed the Court’s decision to allow Terrell to offer testimony on her future medical expenses. N.J.S.A. 39:6A-12, colloquially referred to as New Jersey’s No-Fault statute, prohibits evidence of the amount collectible under PIP when less than all available PIP coverage has been exhausted. The statute also prevents juries from speculating as to the amount of medical expense benefits paid or payable by an automobile insurer under PIP coverage.
The Appellate Division noted that the statute does not require PIP benefits to be actually paid in order for evidence of PIP benefits to be barred, since the statute uses the words “paid or payable.” The Appellate Division held that the plain language of the statute precluded Terrell from offering evidence of any future medical costs up to $238,189.69—the remainder of her PIP limit. Because Terrell’s expert testified that her future surgery would cost between $200,000 and $225,000, the Appellate Division found that the trial court erred in allowing said testimony, and remanded the case for a new trial on damages.
Editor’s Note: Generally speaking, courts are hesitant to allow evidence of insurance/insured status during trials in bodily injury actions, for fear that knowledge that a party is insured may make a jury more willing to assess liability and greater damages against such party. That is at least one reason why declaratory judgment actions are (most often) brought separately from the pending tort action.
O’SHEA RIDES the CIRCUITS
Ryan P. O’Shea
[email protected]
01/20/26 Navigators Ins. Co., v. Under Armour, Inc.
United States Court of Appeals, Fourth Circuit
Single Claim Provision That Contains Logically or Causally Related Language Bars Additional $100 Million in Coverage
In a February 2016 Under Armour made public statements that it felt its financial interests and revenues would not be significantly impacted due to one of its major retailers and consumers facing significant hardships. By March 2016, the retailer filed for Chapter 11 Bankruptcy. Despite this, Under Armour issued a public statement that it expected to grow over 25% in 2016. Two months later, the retailer entered liquidation. A day prior to the liquidation several Under Armour executives sold millions of dollars in Under Armour stock at a significant profit. In spite of the liquidation, Under Armour maintained that it estimated a revenue growth of 24%.
However, certain shareholders were unconvinced, and a derivative demand was made by a shareholder in Fall of 2016. The letter identified false misleading statements regarding the liquidation of the retailer, which inflated stock prices. Under Armour’s 2016 Q4 earnings slowed and by Summer 2017, the company’s share price fell by 25%.
In February 2017, shareholder, Breece, filed a class action suit which asserted violations of federal securities laws. Breece alleged Under Armour made false and/or misleading statements and failed to disclose material adverse facts of the company’s prospects. Several other derivative demands followed that addressed insider trading and the prior false, misleading public statements. In June 2017, the SEC issued subpoenas regarding the alleged violations of securities laws. The subpoenas also requested accounting records from 2015 and 2016.
In August 2017, several plaintiffs in the securities related cases expanded their allegations to include the claims initially asserted by Breece. By November 2019, the SEC identified that Under Armour shifted sales revenue between quarters to appear healthier. In the Summer of 2020, the SEC notified Under Armour of its intent to pursue the company. The SEC contended Under Armour pulled revenue expected in later quarters to earlier questers to appear financially stronger. The pull occurred from the Q3 in 2015 to Q4 in 2016.
Under Armour later settled the securities cases for $434 million and settled with the SEC for $9 million. The shareholder derivative actions were also settled.
Under Armour sought coverage under its Directors & Officers (“D&O”) policies. While the insurers agreed coverage applied, the carriers insisted the public statements and accounting practices constituted a single claim subject to one limit. Obviously, Under Armour disagreed with this interpretation. If Under Armour’s interpretation applied, then an additional $100 million would be owed in coverage.
Continental provided the first layer of coverage under a claims made policy with a $10 million limit. While Endurance and eight (8) other excess insurers added an additional $10 million at each layer. The cumulative coverage is $100 million for a single claim.
Continental and Endurance treated the initial derivative demands and Breece Action as claims first made in the 2016-2017 policy term. Following the SEC’s probe into Under Armour’s accounting, Endurance determined the investigation pertaining to the allegations initially made by Breece. Accordingly, Endurance accepted coverage under the 2016-2017 term and stated all claims related to the SEC were made prior to the 2017-2018 policy period. Endurance tied the SEC investigation related to the accounting of practice of pulling revenue forward to the Under Armour’s public misleading statements.
The policy terms at issue in the 2017-2018 policies contained a Single Claim provision. This provision is what Endurance and all other carriers relied upon for their single limit position. The provision reads:
All Claims which arise out of the same Wrongful Act and all Interrelated Wrongful Acts of Insureds shall be deemed one Claim, and such Claim shall be deemed to be first made on the date the earliest of such Claims is first made against any Insured, regardless of whether such date is before or during the Policy Period.
The defined term Wrongful Acts included any misstatement, misleading statements, act, omission, or breach of duty actually or allegedly committed or attempted. Interrelated Wrongful Acts were defined to include Wrongful Acts that have a common nexus of any fact, circumstance, situation, event, transaction, cause of series of casually connected facts, circumstances, situations, or transactions. Another endorsement that modifies the Single Claim provision that adds language that all Wrongful Acts that are logically or causally related shall be deemed one claim.
Thus, the issue presented is whether the original derivative demand and Breece allegations concerning misleading public statements and insider trading were logically or causally related to the later SEC investigation regarding Under Armour’s accounting practices. The Court of Appeals adopted the insurer’s interpretation.
The court referred to dictionaries to find Logical means that which reasonably or rationally follows from something else. Related was defined by dictionaries as connected to or associated with something else. Thus, the synthesized definition of logically or causally related as used in the modified Single Claim provision is that a single claim occurs when the Wrongful Acts are reasonably or rationally or associated with one another.
The derivative claims and Breece Action, which spurred several other securities related actions, involved public forecasts of Under Armour’s growth. The claims also involved that despite these public statements, the company’s officers used inside information to sell Under Armour stock at a substantial profit. The SEC investigation began to address these same issues.
The SEC subpoenas sought all documents concerning the company’s efforts to achieve a quarterly growth revenue of 20% in 2016. While the SEC later focused on Under Armour’s accounting, the investigation began regarding Under Armour’s public statements. Even so, the accounting investigation looked to the accounting practice of pulling later expected revenue into the 2016 fiscal years to make the company’s financial performance look better. Thus, the accounting manipulation was reasonably and rationally connected to the optimistic public statements regarding Under Armour’s expected growth.
Significantly, the SEC stated the accounting manipulation showed Under Armour could not reach its public growth projections and the failure to disclose the action information rendered the prior public statements misleading. The SEC’s explanation demonstrated why the public statements and accounting claims are causally related. The court reasoned, both practices constituted part of a single scheme with a single goal, to convince shareholders and the public that 20% growth was achievable in spite of the liquidation of Under Armour’s main retailer. As such, the pull-forward and public statements gave the illusion that Under Armour was growing in line with its prior projections.
For these reasons, the court determined the publicly misleading statements and accounting manipulation constituted a single claim. This holding was based upon the plain meaning of the policies’ terms.
LABARBERA’S LOWER COURT LIBRARY
Isabelle H. LaBarbera
[email protected]
01/02/26 Greatwide Am. Trans-Frgt., LLC v. GEICO-Govt. Empls. Ins.
Supreme Court, New York County
Court Affirms Arbitration Award, Finding Petitioner Failed to Rebut Presumption of Mailing
Greatwide American Trans-Freight, LLC (“Greatwide”) filed a petition to vacate an arbitral award issued against it, claiming that it failed to receive notice of the arbitration. The subject notice sent by Arbitration Forums was to an address in Dallas Texas. However, Greatwide claims that it no longer had an office at the time the notice was sent in December 2019, and it did not learn of the award until after it was issued on default.
GEICO-Government Employees Insurance (“GEICO”) in response identified that the particular arbitration at issue, dealing with additional PIP benefits sought by Greatwide, was one of many between the parties. GEICO identifies that the PIP arbitration notice was sent to Greatwide’s mailing address on file. GEICO argues that it was Greatwide’s responsibility to update their address, and by mailing the notice to the previous address on file, it has satisfied the notice requirement.
In support of vacating the arbitral award, Greatwide submitted an affidavit from the VP of Risk Management and Safety. The court concluded that the affidavit was conclusory. In relation to whether Greatwide maintained an office in Dallas, Texas, the VP of Risk Management and Safety solely stated:
In December of 2019 Greatwide American no longer maintained a Dallas, Texas address. The principal place of business for the Greatwide American is 2150 Cabot Blvd W Langhorne, Pennsylvania 19047. This information is readily available on the company website. (See screen shot of Greatwide website annexed hereto as Exhibit 1.) As such, any mailings by Arbitration Forums to the Texas address were never received by Greatwide American.
The court identified that in New York, there is a presumption of mailing, whereby a mailing is assumed to be delivered. Bald, conclusory allegations denying notice is not sufficient to rebut the presumption of receipt under New York law.
Here, the affidavit submitted by Greatwide was not sufficient to rebut the presumption of receipt under New York law. The court classified the affidavit as conclusory, vague, and lacking an assertation regarding when and if the Texas office was abandoned, or what arrangements were made for the mail sent to Texas. Further, the submission lacked documentary proof – such as employee transfers, leases, announcements, or other routine things which would help to rebut the presumption of receipt.
The court stated that Greatwide could have produced an affidavit of someone who logged Greatwide’s mail during the time in question, or someone who worked in the mailroom or office, who had personal knowledge of how mail was handled in December 2019.
As such, the court found that because Greatwide did not meet its burden to show it was no longer located at the Dallas, Texas address, it did not meet its burden to rebut the presumption of receipt. As a result, the court denied the petition and granted the cross-petition to confirm the arbitration award.
LEXI’S LEGISLATIVE LOWDOWN
Lexi R. Horton
[email protected]
01/30/26 New York Senate Bills S8882
Proposed Bill to Authorize the Use of Photo Speed Violation Monitoring in Construction or Maintenance Work Areas on All Highways
On January 13, 2026, Bill S8882 was introduced and seeks to amend the vehicle and traffic law to permit the use of photo speed violation monitoring systems in highway construction or maintenance work areas on all state highways.
The Bill states that the purpose of the bill is to expand and strengthen New York’s work speed zone enforcement program by authorizing the use of photo monitoring on all state-controlled highways.
The Bill’s justification outlines that under the current law, the Department of Transportation may only deploy automated work zone speed cameras on controlled-access highways, which limits the reach of this safety tool.
The Bill proposes the removal of references to “controlled-access highways” in Vehicle and Traffic Law 1180-e to expand the use of photo-enforcement devices on all state highways.
VICTORIA’S VISION ON BAD FAITH
Victoria S. Heist
[email protected]
01/21/26 Pergament v. Government Employees Ins. Co.
New York Appellate Division, Second Department
Second Department Declines Plaintiff's Motion to Amend Complaint to Include a Cause of Action Under Judiciary Law 487(1)
GEICO hired Picciano & Scahill, LLP and Gilbert J. Hardy to represent Melissa Bryant in a personal injury action that was brought against her.
This case involves a lawsuit by a trustee of Bryant's bankruptcy estate against Geico and the law firm/attorneys ("law firm defendants") that handled the underlying case. The lawsuit alleges (1) bad faith refusal to settle the underlying personal injury action for the policy limits after Plaintiff's summary judgment motion on liability was granted; (2) breach of the covenant of good faith and fair dealing; (3) punitive damages against Geico, and legal malpractice against the law firm and attorneys.
Geico and the law firm defendants moved to dismiss the case for failure to state a cause of action, which was denied by the Second Department.
Here, this decision pertains to the trustee of Bryant's estates motion for leave to amend the complaint to adda new cause of action to allege that the defendants violated Judiciary Law Sect. 487(1), by convincing Bryan to file for bankruptcy to "wipe out" a judgment in the underlying personal injury action against her that exceeded the limits of her GEICO Policy. The Supreme Court denied their motion to amend the complaint, and GEICO appealed.
Judiciary Law Sect. 487(1) holds an attorney liable for treble damages when they are guilty of deceit or collusion, or consent to any deceit or collusion, with intent to deceive the court or any party.
The Second Department affirmed the holding of the Supreme Court, because a violation of Judiciary Law Sect. 487(1) is "patently devoid of merit" because "the Plaintiff did not allege that Geico acted as counsel of record in any legal proceeding to which Bryan was a party."
SHIM’S SERIOUS INJURY SEGMENT
Stephen M. Shimshi
[email protected]
01/08/26 C.K. v. Almondo
Kings County Supreme Court
Kings County Supreme Court Denies Defendants’ Summary Judgment Motion on the Basis That Defendants’ Medical Experts Failed to Address Plaintiffs’ Alleged Head Injuries During Plaintiff’s IMEs
This matter arose from personal injuries suffered by plaintiffs, C.K., personally and as Mother and Natural Guardian of D.L.K. ("plaintiffs", collectively), in connection with a two-vehicle accident that occurred on July 29, 2023, near Eastern Parkway and Albany Avenue, County of Kings, City and State of New York. One vehicle, owned by Defendant Joseph and operated by Defendant Almondo, came into contact with another vehicle owned by Ean Holdings, LLC, rented out by Defendant Elrac, LLC, rented by Defendant Leeietta Gibbs, and operated by Defendant Alexandria Gibbs. Plaintiffs were pedestrians who were allegedly injured as a result of the aforementioned motor vehicle accident.
Plaintiff C.K. (adult/mother) and Plaintiff D.L.K. (child) both underwent orthopedic IMEs on Nov. 11, 2024, conducted by Dr. Ferriter, an orthopedist. Plaintiff D.L.K. was also examined at an IME with Dr. Cohen, a neurologist, on Nov. 18, 2024. Dr. Cohen documented D.L.K.’s reflexes as 1+ and Dr. Ferriter documented D.L.K.’s reflexes as 2+ (see Martinez v Pioneer Transp. Co., 48 AD3d 306 [1st Dept 2008]).
Thereafter, Defendants Alexandria Gibbs, Elrac, LLC, and Ean Holdings, LLC moved for summary judgment against Plaintiffs, on the basis that the Plaintiffs did not sustain a serious injury as defined in Insurance Law § 5102(d).
Dr. Ferriter failed to address allegations in the Plaintiffs’ bill of particulars that C.K. had the following injuries: (1) cerebrovascular concussion; (2) body jerks; (3) post-concussion syndrome; (4) dizziness; (5) paroxysmal episodes of dizziness; and (6) and anxiety. In his report, Dr. Ferriter, stated that “‘complaints of head’ were deferred ‘to the appropriate specialty.’“ Defendants did not submit any other report(s) from a doctor(s) examining C.K. with respect to the aforementioned injuries. In sum, neither Dr. Ferriter nor Dr. Cohen addressed D.L.K.’s head pain, anxiety, and emotional stress injury allegations in the bill of particulars.
The Court found that not all of the Plaintiffs’ injury allegations were acknowledged in Defendants’ IME reports. As such, the movants failed to make a prima facie showing that Plaintiffs did not sustain a serious injury as defined by Insurance Law § 5102(d) (see Salcedo v MTA-New York City Transit, 217 AD3d 698 [2d Dept 2023]; Rosales v Rivera, 176 AD3d 753 [2d Dept 2019]; Adams v Dura Cab Corp., 152 AD3d 634 [2d Dept 2017]; Haque v City of New York, 97 AD3d 636 [2d Dept 2012]; Krayn v Torella, 40 AD3d 588 [2d Dept 2007]). As such, the movants failed to demonstrate that there were no issues of fact pertaining to serious injury. Based on the foregoing, the Court denied the Defendants’ summary judgment motion and held that the issue of serious injury must be resolved at trial.
NORTH of the BORDER
Heather A. Sanderson, K.C.
Sanderson Law
Calgary, Alberta, Canada
[email protected]
The content of this column also appears in the “Liability & Insurance,” a monthly newsletter focusing on Canadian coverage and published by Heather Sanderson. Contact her for a subscription.
11/24/25 2689686 Ontario Inc. v. Lloyd's Underwriters
Ontario Columbia Court of Appeal
The Application of an Exclusion in a Property Policy May Be Determined on a Summary Judgment Motion, But Expert Evidence Must Be Adduced by Affidavit, and Any Opposing Opinion Must Be Put to the Expert Through Cross-Examination on That Affidavit
Kirkland Lake, Ontario, a northeastern Ontario town with a population of about 8,000, was established to support the many gold mines in the area that thrived from the late 1800s well into the 20th century. Foster Hewitt famously called Kirkland Lake “the town that made the NHL,” owing to the remarkable number of NHL players and coaches born there in the 1930s and 1940s.
For years in the 1940s and into the 1950s, the Parklane Hotel at Duncan Avenue South and Government Road in Kirkland Lake was the place to stay. It was a prominent five-storey hotel occupying most of the city block. After changing hands, it eventually closed. Its former rooms were rented as apartments, but reports indicate that during a large portion of the 1990s the old hotel stood vacant.
In 2019, 2689686 Ontario Inc. (268) acquired the hotel, a smaller three-storey building beside it, and two empty lots on the other side of the old hotel for restoration and redevelopment. Syed Mansoor Ali Naqvi, the principal of 268, is a Toronto-based entrepreneur with ventures spanning financial services, real estate, insurance, and accounting. Despite labour shortages and other difficulties, he is said to have invested $10 million and seven years in the re-development project. In November 2025, the project opened as a 55-room Ramada Hotel. Within a couple of weeks of its opening, the Ontario Court of Appeal released a judgment describing one of the “speedbumps” endured during the renovation, which occurred on April 1, 2020.
On that date, the roof of what was described as “a 3-storey building” collapsed. The central issue was causation.
At the time of the collapse, 268 held a builders’ risk (course of construction) policy issued by Lloyd’s under which it was the named insured. The policy covered the address of the three-storey building that was in the “course of construction, installation, reconstruction or repair.” There was a minor issue as to whether the redevelopment was actively underway at the time, given a lack of meaningful construction work for some months. If the project was in redevelopment, Lloyd’s took the position that the loss was excluded as caused by “frost or freezing.” Litigation ensued. Following examinations for discovery, Lloyd’s moved for summary judgment to dismiss the claim for insurance proceeds.
The Trial Judgment
The trial judge held that a lull in activity is normal in a redevelopment project and that such a lull was occurring when the roof collapsed. The claim therefore fell within the policy’s insuring agreement. The sole issue was whether the exclusion applied.
Lloyd’s relied on the affidavit evidence of consulting structural engineer Aime Rivard of Timmins, Ontario, who attached his reports following a site inspection conducted within days of the collapse. Mr. Rivard opined, among other things, that he found severe, longstanding structural problems with the building’s foundation walls and that the roof failure was mainly caused by frost heaving of the basement slab, which lifted interior partitions and floors above, likely jacking up the centre of the roof framing and causing failure; snow was not the main cause.
268 disputed this opinion by pointing to an email from Mr. Rivard’s stating: “At the back 3-storey portion of the building, there has been an obvious failure of the roof as a result of snow loads.” The same email also stated, “that the building had withstood snow loads for decades, including record conditions in 2019”. 268 argued this raised credibility issues requiring a trial and that summary judgment should be refused. The trial judge noted that 268 did not cross-examine Mr. Rivard on his affidavit.
The trial judge held that the record contained the material the parties would rely on at trial regarding the frost or freezing exclusion and that summary judgment was appropriate. The judge rejected 268’s characterization of a contradiction, noting the email comments appeared to have been made following the initial inspection and before completion of Mr. Rivard’s engineering analysis and final opinion in his initial report of May 29, 2020. 268 offered no contrary expert evidence, no explanation for why Lloyd’s engineering opinion was incorrect, and no alternative cause other than to suggest that the roof collapsed due to snow load.
The trial judge was satisfied that the collapse was due to frost heave. Lloyd’s had met its onus to prove the loss was caused by an excluded peril, meaning that there was no coverage. 268 appealed.
The Appeal Judgment
On appeal, 268 argued that the matter was unsuitable for summary judgment because experts disagreed on causation. The Court of Appeal dismissed this, holding the trial judge could weigh evidence, make credibility findings, and draw reasonable inferences.
268 next argued that the excluded peril finding was not available on the record. The Court of Appeal noted the trial judge properly assessed the motion evidence; his decision was entitled to deference. 268 had not filed its engineer’s evidence by sworn affidavit and did not cross-examine Mr. Rivard. With no admissible contrary expert evidence, causation was uncontested: the roof collapse was caused by frost heave. Under subparagraph 6B(e), “frost or freezing” is excluded, so there was no coverage. The Court of Appeal agreed that this finding was available on the evidence.
268 further argued the doctrine of nullification; that enforcing the exclusion would be inconsistent with the policy’s purpose and would defeat the main object of the contract. The Court of Appeal rejected this. The builders’ risk policy covered direct physical loss or damage, subject to specified risks. Enforcing the frost and freezing exclusion did not negate coverage; perils such as fire, vandalism, and wind remained covered, while “frost or freezing” was not. This was not illusory coverage, and the doctrine of nullification did not apply.
The Court of Appeal dismissed the appeal. By agreement, costs were fixed at $12,900, payable by 268 to Lloyd’s.
Comment
This decision confirms that summary judgment can be an effective tool where an exclusion is alleged to displace coverage. However, where application of an exclusion depends on expert opinion, the expert’s evidence must be presented by affidavit, and opposing parties must put contrary opinions to the expert through cross-examination. Finally, if applying an exclusion would nullify coverage entirely, it should not be applied; where, as here, loss caused by a specific peril is excluded, there is no bar to applying that exclusion.
© Hurwitz Fine P.C. 2026
All rights reserved
