Lewis & Stanzione v. St. Paul Fire & Marine Insurance Company
Filing
65
MEMORANDUM-DECISION AND ORDER: It is hereby ORDERED that St. Pauls motion for summary judgment (Dkt. No. 57 ) is GRANTED, and St. Paul does not have, nor ever had, a duty to defend or indemnify Stanzione in connection with the Underlying Action; and it is further ORDERED that plaintiffs motion for summary judgment (Dkt. No. 56 ) is DENIED; and it is further ORDERED that St. Pauls motion to strike (Dkt. No. 59 ) is DENIED AS MOOT; and it is furtherORDERED that the Clerk close this case; and it is further ORDERED that the Clerk provide a copy of this Memorandum-Decision and Order to the parties. Signed by Chief Judge Gary L. Sharpe on 6/17/2015. (ban)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
________________________________
LEWIS & STANZIONE et al.,
Plaintiffs,
1:13-cv-863
(GLS/RFT)
v.
ST. PAUL FIRE & MARINE
INSURANCE COMPANY,
Defendant.
________________________________
APPEARANCES:
OF COUNSEL:
FOR THE PLAINTIFFS:
Lewis & Stanzione
Lewis, Stanzione Law Firm
287 Main Street
Catskill, NY 12414
Lewis & Stanzione; Joseph Stanzione
Office of Raymond A. Kelly
112 State Street
Suite 1005
Albany, NY 12207
FOR THE DEFENDANT:
Aronberg, Goldgehn Law Firm
330 North Wabash, Suite 1700
Chicago, IL 60611
Goldberg, Segalla Law Firm
8 Southwoods Boulevard
Suite 300
Albany, NY 12211-2526
RALPH C. LEWIS, JR., ESQ.
RAYMOND A. KELLY, ESQ.
AMBER O. LAFEVERS, ESQ.
CHRISTOPHER J. BANNON,
ESQ.
MATTHEW S. LERNER, ESQ.
MEMORANDUM-DECISION AND ORDER
I. Introduction
Plaintiffs Lewis & Stanzione (hereinafter, “the Firm”) and Joseph
Stanzione, the insured, commenced this diversity action against defendant
St. Paul Fire & Marine Insurance Company, the insurer, seeking a
declaratory judgment that St. Paul must defend Stanzione in an underlying
lawsuit pursuant to a professional liability insurance policy. (Am. Compl.,
Dkt. No. 35.)1 Pending are plaintiffs’ motion for summary judgment, (Dkt.
No. 56), St. Paul’s motion for summary judgment, (Dkt. No. 57), and St.
Paul’s motion to strike, (Dkt. No. 59). For the reasons that follow, St.
Paul’s motion for summary judgment is granted, its motion to strike is
denied as moot, and plaintiffs’ motion for summary judgment is denied.
II. Background
A.
Facts2
St. Paul issued a Lawyer’s Professional Liability Policy, under policy
number 561JB9299 (the “Policy”), to the Firm, which was effective from
June 3, 2010 to June 3, 2011, and generally provides defense and
1
Although plaintiffs’ amended complaint asserts five causes of
action, (Am. Compl. ¶¶ 55-86), the parties have since stipulated to
dismissal of plaintiffs’ second, third, fourth, and fifth causes of action, (Dkt.
No. 54), leaving only plaintiffs’ claim for a declaratory judgment remaining.
2
Unless otherwise noted, the facts are not in dispute.
2
indemnity coverage.3 (Dkt. No. 57, Attach. 2 at 9-27; Def.’s Statement of
Material Facts (SMF) ¶ 1, Dkt. No. 57, Attach. 5.) More specifically, the
Policy provides that St. Paul will indemnify an insured for “‘damages’4 and
‘claims expenses,’” as long as the “‘damages’ . . . arise out of an error,
omission, negligent act or ‘personal injury’, in the rendering of or failure to
render ‘legal services’5 for others.” (Def.’s SMF ¶ 2; Dkt. No. 57, Attach. 2
at 13.) With respect to St. Paul’s defense obligations, the Policy provides
that St. Paul “will have the right and duty to defend any ‘claim’6 or ‘suit’
against an insured seeking ‘damages’ to which this insurance applies,
even if any of the allegations of the ‘claim’ or ‘suit’ are groundless, false or
3
The insured under the policy includes the Firm, along with “[a]ny
person who was, is now or hereafter becomes a partner . . . of the [Firm].”
(Dkt. No. 57, Attach. 2 at 10, 14; Def.’s SMF ¶ 5.)
4
“Damages” are defined as “compensatory damages which an
insured becomes legally obligated to pay as a result of any judgment,
award or settlement,” but “does not include punitive or exemplary
damages, fines, sanctions or penalties, equitable relief or the return or
reimbursement of fees for ‘professional legal services’ whether or not
rendered.” (Dkt. No. 57, Attach. 2 at 16.)
5
“Professional Legal Services” are defined as “services performed
or advice given by you or on your behalf for others in the conduct of your
practice as a lawyer.” (Dkt. No. 57, Attach. 2 at 17.)
6
“Claim” is defined as “a demand received by an insured for money
alleging an error, omission or negligent act in the rendering of or failure to
render ‘professional legal services’ for others by you or on your behalf.”
(Dkt. No. 57, Attach. 2 at 16.)
3
fraudulent.” (Def.’s SMF ¶ 2; Dkt. No. 57, Attach. 2 at 13.) Additionally,
the Policy includes certain exclusions, which outline what is not covered
under the agreement. (Dkt. No. 57, Attach. 2 at 15-16.) As relevant here,
the Policy states that “[t]his insurance does not apply to ‘claims’ . . .
[a]rising out of any dishonest, fraudulent, criminal or malicious act, error,
omission or ‘personal injury’ committed by, at the direction of, or with the
knowledge of an insured,” (hereinafter, “the Fraud Exclusion”). (Id. at 15.)
Stanzione is a partner with the Firm, and, therefore, an insured
under the Policy. (Def.’s SMF ¶ 6; Dkt. No. 57, Attach. 2 at 10, 14.) On or
about March 17, 2011, Stanzione was sued in New York State court
(hereinafter, “the Underlying Action” or “the Underlying Complaint”).
(Def.’s SMF ¶¶ 7-10; Dkt. No. 57, Attach. 3.) The Underlying Action was
brought by Melvin D. Hiller & Jeffrey Hiller LLC and Freehold House, Inc.
(hereinafter, “the Underlying Plaintiffs”), and alleges only one claim
against Stanzione: fraud. (Dkt. No. 57, Attach. 3 at 2-3, 10-11.) While the
facts of the Underlying Action are complex, the court’s discussion of them
is not. Generally, the Underlying Plaintiffs allege that Stanzione, who
represented the sellers of the Freehold Country Inn (hereinafter, “the Inn”),
along with the other defendants, orchestrated and participated in a
4
scheme that fraudulently induced Melvin D. Hiller & Jeffrey Hiller LLC to
extend a loan in the amount of $1.25 million to Zofia Goshal, the
purchaser of the Inn. (Pls.’ SMF ¶ 17, Dkt. No. 56, Attach. 2; Dkt. No. 57,
Attach. 3 at 3-5.) The loan was secured by a mortgage on the Inn and
Goshal’s personal guarantee of repayment. (Dkt. No. 57, Attach. 3 at 45.) Soon after the closing, however, Goshal defaulted on her mortgage
payments, which forced Melvin D. Hiller & Jeffrey Hiller LLC to foreclose
on the loan, costing it “damages in excess of $750,000.00.” (Id. at 4-6.)
The Underlying Plaintiffs, thus, seek compensatory and punitive damages
in the amount of several million dollars. (Id. at 15-16.)
Soon after Stanzione was served with the amended complaint, he
notified St. Paul and requested that it defend him in the Underlying Action.
(Pls.’ SMF ¶¶ 7, 14; Def.’s SMF ¶ 13.) Thereafter, St. Paul sent a letter to
Stanzione denying defense and indemnity coverage for the Underlying
Action. (Def.’s SMF ¶ 14; Dkt. No. 56, Attach. 5 at 28-32.) In its letter, St.
Paul informed Stanzione that coverage was denied because “all of the
wrongful acts allegedly committed by you are claimed to have occurred as
part of a fraudulent scheme intended to secure the loan at issue,” and “the
Policy does not apply to claims arising out of a ‘dishonest, fraudulent,
5
criminal or malicious act, error or omission.’” (Dkt. No. 56, Attach. 5 at
30.)
B.
Procedural History
The Firm commenced this action in New York State court, seeking,
among other things, a declaratory judgment ordering St. Paul to defend
Stanzione in the Underlying Action, but failed to name Stanzione as a
plaintiff. (Dkt. No. 1, Attach. 1 at 2-4.) Thereafter, St. Paul removed the
action to federal court, (Dkt. No. 1), filed an answer with counterclaims,
(Dkt. No. 6), and interposed a third-party complaint against Stanzione,
(Dkt. No. 17). After a few rounds of tortured motion practice, (Dkt. Nos.
24, 27), the procedural posture of this case aligned—and all third-party
practice was eradicated—upon the Firm and Stanzione’s filing of an
amended complaint, (Dkt. No. 35). St. Paul then filed an answer to the
amended complaint and interposed a counterclaim against Stanzione,
seeking only a declaration that St. Paul is not obligated to defend or
indemnify him in the Underlying Action. (Dkt. No. 45.) The parties then
filed their respective summary judgment motions, (Dkt. Nos. 56, 57), and
St. Paul filed a cross motion to strike, (Dkt. No. 59), all of which are now
ripe for review.
6
III. Standard of Review
The standard of review pursuant to Fed. R. Civ. P. 56 is well
established and will not be repeated here. For a full discussion of the
standard, the court refers the parties to its decision in Wagner v. Swarts,
827 F. Supp. 2d 85, 92 (N.D.N.Y. 2011), aff’d sub nom. Wagner v.
Sprague, 489 F. App’x 500 (2d Cir. 2012).
IV. Discussion7
St. Paul contends that it has no duty to defend or indemnify
Stanzione in the Underlying Action because the Underlying Complaint fits
squarely and entirely within the Fraud Exclusion. (Dkt. No. 57, Attach. 6 at
7-13.) In response, plaintiffs primarily contend that a fair reading of the
Underlying Complaint suggests a reasonable possibility of coverage. (Dkt.
No. 58 at 5-11.) Plaintiffs further contend that a determination regarding
St. Paul’s obligation to indemnify is premature at this juncture. (Dkt. No.
56, Attach. 3 at 18-20.) The court agrees with St. Paul in all respects.
A.
St. Paul’s Duty to Defend
Under New York law, an insurer has an “exceedingly broad” duty to
defend the insured, Auto. Ins. Co. of Hartford v. Cook, 7 N.Y.3d 131, 137
7
The parties, and the court, agree that New York law applies to this
diversity action.
7
(2006) (internal quotation marks and citation omitted), and the duty to
defend is even broader than the duty to indemnify, see Seaboard Sur. Co.
v. Gillette Co., 64 N.Y.2d 304, 310 (1984). An insurer’s obligation to
provide a defense is triggered “whenever the allegations of the complaint
suggest . . . a reasonable possibility of coverage.” Cook, 7 N.Y.3d at 137
(internal quotation marks and citation omitted).
This duty to defend on the insurer’s part remains, unless the insurer
can “establish, as a matter of law, that there is no possible factual or legal
basis on which the insurer might eventually be obligated to indemnify [the
insured] under any provision contained in the policy.” Villa Charlotte
Bronte, Inc. v. Commercial Union Ins. Co., 64 N.Y.2d 846, 848 (1985).
For this reason, an insurer who seeks to be relieved of the duty to defend
based on a policy exclusion
bears the heavy burden of demonstrating that the
allegations of the complaint cast the pleadings wholly
within that exclusion, that the exclusion is subject to no
other reasonable interpretation, and that there is no
possible factual or legal basis upon which the insurer
may eventually be held obligated to indemnify the
insured under any policy provision.
Frontier Insulation Contractors, Inc. v. Merchs. Mut. Ins. Co., 91 N.Y.2d
169, 175 (1997). Further, “[i]f any of the claims against the insured
8
arguably arise from covered events, the insurer is required to defend the
entire action.” Id.
Moreover, a court reviewing an insurance policy must remain
mindful that it is a “contract[ ] to which the ordinary rules of contractual
interpretation apply.” Accessories Biz, Inc. v. Linda & Jay Keane, Inc.,
533 F. Supp. 2d 381, 386 (S.D.N.Y. 2008). New York insurance contracts
are construed in light of “common speech.” Ace Wire & Cable Co. v.
Aetna Cas. & Sur. Co., 60 N.Y.2d 390, 398 (1983). Insurance contracts
also must be interpreted “according to the reasonable expectation and
purpose of the ordinary businessman when making an ordinary business
contract.” Gen. Motors Acceptance Corp. v. Nationwide Ins. Co., 4 N.Y.3d
451, 457 (2005) (internal quotation marks and citation omitted). Where
there are ambiguous terms in a policy, these “must be construed in favor
of the insured and against the insurer.” White v. Cont’l Cas. Co., 9 N.Y.3d
264, 267 (2007).
Here, the Underlying Complaint alleges exclusively dishonest and
fraudulent conduct on the part of Stanzione, and, in fact, asserts only a
single claim of fraud against him. (See generally Dkt. No. 57, Attach. 3.)
Specifically, the Underlying Complaint alleges, among other things, that
9
Stanzione: (1) was “aware of the [mis-]representations that had been
made to the Hillers” regarding Goshal’s ability to repay the loan; (2)
“aid[ed] and abett[ed] the fraud”; (3) had “knowledge” that Goshal was, in
fact, “indigent” and incapable of ever repaying the loan, and that other
defendants “had to lend her and/or advance on her behalf[] some
thousands of dollars to enable the closing at which they participated”; and
(4) “knowingly participated in the fraud . . . in order to gain the proceeds of
the mortgage granted to . . . Goshal [and] to secure funds for [himself].”
(Id. at 4, 7-10.) Because the Fraud Exclusion unambiguously8 states that
the Policy “does not apply to ‘claims’ . . . [a]rising out of any dishonest,
fraudulent, criminal or malicious act, error, omission or ‘personal injury’
committed by, at the direction of, or with the knowledge of an insured,”
8
Citing affidavits from Stanzione and his partner, Ralph Lewis, (Dkt.
No. 56, Attach. 8 at 2-8, 10-17), plaintiffs contend that the Fraud Exclusion
is ambiguous because “the common understanding among New York
practitioners [is] that a criminal act/fraud exclusion only applies to
independent wrongful criminal acts not occurring during the traditional
rendition of professional legal services.” (Dkt. No. 56, Attach. 3 at 15-17.)
Putting aside the threshold question of whether these affidavits are
admissible, (see generally Dkt. No. 59 at 4-13), Lewis and Stanzione’s
subjective beliefs and expectations are irrelevant. “When interpreting the
meaning of a contract, it is the objective intent of the parties that controls.
The secret or subjective intent of the parties is irrelevant.” Galanis v.
Harmonie Club of City of N.Y., No. 1:13-cv-4344, 2014 WL 4928962, at *8
(S.D.N.Y. Oct. 2, 2014) (quoting Klos v. Lotnicze, 133 F.3d 164, 168 (2d
Cir. 1997)).
10
(Dkt. No. 57, Attach. 2 at 15), it clearly applies to, and precludes coverage
for, the Underlying Action. See Cent. Mut. Ins. Co. v. Willig, 29 F. Supp.
3d 112, 120 (N.D.N.Y. 2014) (holding that insured had no duty to defend
or indemnify where “the entirety of the Underlying Complaint fit[] within the
[wrongful act] Exclusion”); Silverman Neu, LLP v. Admiral Ins. Co., 933 F.
Supp. 2d 463, 475-79 (E.D.N.Y. 2013) (holding that a “Wrongful Act”
exclusion in an insurance policy was “stated in clear and unmistakable
language, is subject to no other reasonable interpretation, and applies in
the particular case” (internal quotation marks and citation omitted));
Chicago Ins. Co. v. Borsody, 165 F. Supp. 2d 592, 598 (S.D.N.Y. 2001)
(holding that an insurer owed no duty to defend or indemnify the insured
because the allegations against the insured arose out of fraudulent,
dishonest, or criminal conduct, which precluded coverage under a similar
fraud exclusion).
Plaintiffs contend, however, that the Underlying Complaint could
reasonably be read to suggest that some of the allegations against
Stanzione arguably arise from covered events, namely, the allegation that
Stanzione was providing legal services to the sellers of the Inn. (Dkt. No.
56, Attach. 3 at 8-13; Dkt. No. 58 at 6.) In essence, plaintiffs argue that,
11
since the Underlying Complaint alleges that Stanzione was rendering legal
services, and the Policy provides that St. Paul will indemnify an insured for
“‘damages’ [that] arise out of an error, omission, negligent act or ‘personal
injury’, in the rendering of or failure to render ‘legal services’ for others,”
(Dkt. No. 57, Attach. 2 at 13 (emphasis added)), the court need not read
any further.9 (Dkt. No. 56, Attach. 3 at 8-13; Dkt. No. 58 at 6.) This
9
In support of this argument, plaintiffs rely on American Guaranty
and Liability Insurance Co. v. Moskowitz, 58 A.D.3d 426 (1st Dep’t 2009),
in which the Appellate Division affirmed the New York State Supreme
Court’s holding that a professional liability insurer was required to defend
its insured, an attorney, against claims of fraud and racketeering activity
because the claims in the underlying lawsuit were predicated on the
lawyer’s acts or omissions in rendering legal services. (Dkt. No. 56,
Attach. 3 at 11-12.) Moskowitz, however, is distinguishable, as the court
there was not construing the scope of an exclusion similar to the Fraud
Exclusion here, but, instead, was interpreting a provision that excluded
coverage “for claims that are based upon . . . the [i]nsured’s capacity or
status as an officer, director, partner, manager or employee of a business
enterprise.” Am. Guar. & Liab. Ins. Co. v. Moskowitz, 19 Misc. 3d 548,
550-51 (N.Y. Sup. Ct. 2008). Thus, Moskowitz has no bearing on the facts
here. In fact, the court agrees with St. Paul that Chicago Ins. Co. v.
Borsody, 165 F. Supp. 2d 592 (S.D.N.Y. 2001), is more on point. (Dkt.
No. 64 at 4-5.) In Borsody, the court rejected a similar “rendering legal
services” argument, and noted that “[t]he fact that [the insured]’s alleged
conduct happened to have occurred in the performance of legal services
does not change the overall gravamen or tenor of the complaint, or
otherwise elevate the complaint to a covered dispute.” 165 F. Supp. 2d at
598 (citations omitted). The court further noted that, as is the case here,
“[t]he charges against [the insured] in the [underlying] complaint ‘aris[e]
out of’ alleged fraudulent, dishonest or criminal misconduct, and as such
are barred from coverage.” Id.
12
proposition, however, ignores well-established New York law governing
contract interpretation. “In construing a contract, a court should read the
contract as a whole, . . . and avoid any interpretation that would render a
contractual provision without force and effect.” Luitpold Pharms., Inc. v.
Ed. Geistlich Söhne A.G. Für Chemische Industrie, 784 F.3d 78, 87 (2d
Cir. 2015) (citing Westmoreland Coal Co. v. Entech, Inc., 100 N.Y.2d 352,
358 (2003); Two Guys from Harrison-N.Y., Inc. v. S.F.R. Realty Assocs.,
63 N.Y.2d 396, 403 (1984)); see Albert J. Schiff Assocs., Inc. v. Flack, 51
N.Y.2d 692, 697 (1980) (“Just as [an insuring agreement] clause
affirmatively indicates the coverage which is included, so does the
‘exclusion’ clause tell us expressly what is not. In policies so drawn, . . . it
is not either alone, but the combination of both, which defines the scope of
the protection afforded.”). While there is no dispute that Stanzione was
rendering legal services when he represented the sellers of the Inn, that
simply does not end the inquiry. If the court were to read the Policy to
impose coverage obligations on St. Paul solely because the Underlying
Complaint alleges that Stanzione rendered legal services, it would vitiate
the Fraud Exclusion. The court declines to do so.
Further, although plaintiffs argue otherwise, (Dkt. No. 56, Attach. 3
13
at 12-13; Dkt. No. 58 at 10-11), this holding is not in conflict with
Automobile Insurance Co. of Hartford v. Cook, 7 N.Y.3d 131 (2006). In
Cook, the New York Court of Appeals held that the insurer had a duty to
defend the insured in an underlying wrongful death action where the
insured was sued for negligence, but facts outside of the complaint
indicated that the insured had acted intentionally. 7 N.Y.3d at 135-37.
The insurer was obligated to defend the insured, despite a “wrongful act
exclusion,” which excluded coverage for intentional acts, because the
insurer “failed to demonstrate that the allegations of the complaint [were]
subject to no other interpretation than that” the insured acted intentionally.
Id. at 138. Here, however, although the court does not pass judgment on
the merits of the claims asserted in the Underlying Action, the only
interpretation of those claims is that Stanzione acted dishonestly or
fraudulently, or, at least, with knowledge of dishonest and fraudulent
behavior. Certainly, as plaintiffs argue, (Dkt. No. 56, Attach. 3 at 18-20;
Dkt. No. 58 at 7-9), Stanzione could be found not liable in the Underlying
Action, and the facts asserted against him could be “groundless, false,
fraudulent or baseless,”10 (Dkt. No. 58 at 7), “but that uncertain outcome is
10
Plaintiffs rely on the Policy language that St. Paul will provide
defense coverage “even if any of the allegations . . . are groundless, false
14
immaterial to the issue raised here,” Cook, 7 N.Y.3d at 138, which is
whether “the allegations of the [Underlying C]omplaint cast the pleadings
wholly within th[e Fraud E]xclusion,” Frontier Insulation Contractors, 91
N.Y.2d at 175. As the court has already found, the Underlying Complaint
fits entirely within the Fraud Exclusion.
Finally, plaintiffs argue that summary judgment in favor of St. Paul is
improper because an internal email sent from claims counsel, Alicia
Morejon, regarding the Firm’s claim requesting coverage, states that,
“Lewis Stanzione is the insured and . . . I get the sence (sic) I can’t
outright deny but the allegation against the insured is for fraud only.” (Dkt.
No. 56, Attach. 8 at 19; Dkt. No. 58 at 6-7.) Plaintiffs contend that “[t]his
doubt expressed by Morejon falls well within the . . . decree that ‘[A]ny
doubt as to whether the allegations state a claim within the coverage of
or fraudulent.” (Dkt. No. 56, Attach. 3 at 8-9; Dkt. No. 57, Attach. 2 at 13;
Dkt. No. 58 at 7-9.) But, in so relying, plaintiffs ignore the full language of
the defense provision, which is that St. Paul “will have the right and duty to
defend any ‘claim’ or ‘suit’ against an insured seeking ‘damages’ to which
this insurance applies, even if any of the allegations of the ‘claim’ or ‘suit’
are groundless, false or fraudulent.” (Dkt. No. 57, Attach. 2 at 13
(emphasis added).) As the Fraud Exclusion makes clear, the Policy does
not apply to claims that “[a]ris[e] out of any dishonest, fraudulent, criminal
or malicious act, error, omission or ‘personal injury’ committed by, at the
direction of, or with the knowledge of an insured.” (Id. at 15.) Accordingly,
it does not matter if the claims in the Underlying Complaint are
groundless, false, or fraudulent, as the Policy does not apply to them.
15
the policy must be resolved in favor of the insured and against the
carrier.’” (Dkt. No. 58 at 6-7 (quoting Brook Shopping Ctr., Inc. v. Liberty
Mut. Ins. Co., 80 A.D.2d 292, 294 (1st Dep’t 1981).) Plaintiffs’ argument is
unavailing. The question is whether, in the court’s view, there are any
doubts as to whether the allegations within the four corners of the
Underlying Complaint suggest a possibility of coverage. What Morejon
may or may not have initially questioned is irrelevant. Ultimately,
Morejon’s email does not alter the court’s reading of the Underlying
Complaint, or persuade the court that there are any claims or allegations
asserted against Stanzione that pull any portion of the Underlying
Complaint outside of the Fraud Exclusion’s scope, such that any coverage
would be possible.
B.
St. Paul’s Duty to Indemnify
St. Paul contends that, because it has no duty to defend Stanzione
in the Underlying Action, it, therefore, also has no duty to indemnify him.
(Dkt. No. 60 at 15-17.) Plaintiffs, however, argue that a determination on
indemnification is premature. (Dkt. No. 56, Attach. 3 at 18-20.) The court
again agrees with St. Paul.
As noted above, the duty to defend is broader than the duty to
16
indemnify. See Seaboard Sur., 64 N.Y.2d at 310. It stands to reason,
then, if there is no duty to defend, there can be no duty to indemnify. See
EAD Metallurgical, Inc. v. Aetna Cas. & Sur. Co., 905 F.2d 8, 11 (2d Cir.
1990) (noting that, because “the duty to defend is broader than the duty to
indemnify[,] it is unnecessary to engage in a separate analysis of [an
insurer]’s independent claim that it has no duty to indemnify”);
Transamerica Ins. Grp. v. Rubens, No. 97 Civ. 8911, 1999 WL 673338, at
*7 (S.D.N.Y. Aug. 27, 1999) (“[The insurer] has no duty to defend, and
therefore no duty to indemnify.”); State of N.Y. v. Blank, 745 F. Supp. 841,
844 (N.D.N.Y. 1990) (“It is also well settled that because the duty to
defend is broader than the duty to indemnify, a finding by a court that
there is no duty to defend automatically means that there is no duty to
indemnify.”). Thus, because St. Paul has no duty to defend Stanzione in
the Underlying Action, it similarly has no duty to indemnify him for any
damages that may be awarded against him in the Underlying Action.
Accordingly, having granted St. Paul’s motion for summary
judgment, (Dkt. No. 57), plaintiffs’ motion for summary judgment, (Dkt. No.
56), which seeks the exact opposite relief, is necessarily denied,11 and St.
11
Of course, denial of plaintiffs’ summary judgment motion
necessarily includes a denial of their claim for reimbursement of the
17
Paul’s motion to strike, (Dkt. No. 59), is denied as moot.
V. Conclusion
ACCORDINGLY, it is hereby
ORDERED that St. Paul’s motion for summary judgment (Dkt. No.
57) is GRANTED, and St. Paul does not have, nor ever had, a duty to
defend or indemnify Stanzione in connection with the Underlying Action;
and it is further
ORDERED that plaintiffs’ motion for summary judgment (Dkt. No.
56) is DENIED; and it is further
ORDERED that St. Paul’s motion to strike (Dkt. No. 59) is DENIED
AS MOOT; and it is further
ORDERED that the Clerk close this case; and it is further
ORDERED that the Clerk provide a copy of this MemorandumDecision and Order to the parties.
IT IS SO ORDERED
June 17, 2015
Albany, New York
amounts incurred “defending this action commenced by St. Paul.” (Dkt.
No. 56, Attach. 3 at 21-22.) The court notes, however, that this request
should also be denied because St. Paul did not commence this action;
plaintiffs did.
18
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