Typical first party property policies include provisions that address failure to maintain heat as excluded losses. The Eastern District of New York recently analyzed a specific endorsement requiring that heat be maintained at a particular temperature.
In Read Prop. Group LLC v. Hamilton Ins. Co., No. 16-4573, 2018 U.S. Dist. LEXIS 54734 (E.D.N.Y. Mar.…
Insurers retain outside counsel during claim investigations for a variety of reasons, including, among others, providing coverage advice, assisting in reviewing and responding to communications with insureds that have legal implications, and providing settlement recommendations. When coverage disputes arise, policyholders often seek the production of these pre-suit communications, arguing that outside counsel was merely performing an investigation that the company was required to conduct as part of the ordinary course of its business, and that such communications are therefore not privileged. These arguments have routinely been rejected by courts.
Continue Reading Work Product and Attorney-Client Privilege Concerning Documents Drafted Prior To Litigation: Eastern District Of New York Finds Insurer’s Documents Are Not Discoverable
Recently, in Mallek v. Allstate Indem. Co. No. 17-CV-5949-KAM-SJB, 2018 U.S. Dist. LEXIS 42171 (E.D.N.Y. Mar. 12, 2018), a federal magistrate in New York recommended that the Court deny a plaintiff’s motion to remand and suggested that removal was proper where the plaintiff “fraudulently” joined an insurance agent. Oftentimes, coverage actions involve a plaintiff suing a national insurance company, where neither are citizens of the same state, and therefore, the case may be eligible for removal under 28 U.S.C. § 1332. However, some plaintiffs have included local agents of the insurance company—like a claims professional who handled their claim—as named-defendants, along with the insurer, in an attempt to defeat complete diversity between a local plaintiff and a national insurance carrier.
Continue Reading Eastern District of New York Magistrate Recommends Denial of a Motion to Remand and Recognizes the Application of the Fraudulent Joinder Doctrine, Even in the Face of the “Forum Defendant Rule”
Nearly five years after Superstorm Sandy, some consistent themes are beginning to emerge from the increasingly robust body of property coverage case law related to the storm. A recent decision from the Eastern District of New York addresses a topic that this Blog has covered before – the application of flood exclusions in traditional open peril policies.
The Madelaine Chocolate Company was a manufacturer of seasonal foil-wrapped chocolates insured under an “open peril” business policy issued by Great Northern Insurance Company. Purported to be one of the largest private employers in Queens, New York, Madelaine Chocolate conducted its business in three buildings located in Rockaway Beach. During Superstorm Sandy, the facility was inundated with four feet of water from both Long Island Sound to the north and the Atlantic Ocean to the south. After the storm, Madelaine Chocolate made a $40 million property damage claim and a $13.5 million business income/extra expense claim. Great Northern paid Madelaine Chocolate $4 million and denied the remainder of the claim based on the policy’s flood exclusion.
Continue Reading Eastern District of New York Upholds Flood Exclusion in Superstorm Sandy Case
