Traub Lieberman Partner Eric D. Suben Obtains Dismissal of Claim Against Insurer

Plaintiff’s employer was sued in the underlying third-party action by a contracting party seeking indemnification based on both common law and contractual theories. In parallel coverage litigation, the contracting party brought a claim directly against the insurer for a declaration of coverage in connection with the underlying indemnification claims. Traub Lieberman Straus & Shrewsberry LLP partner Eric D. Suben moved for dismissal to the extent coverage was sought based on common-law indemnification or contribution. In this regard, Mr. Suben argued that because the insured was plaintiff’s employer and plaintiff was covered by worker’s compensation, the “employer’s liability” and “worker’s compensation” exclusions in the CGL coverage form were dispositive of coverage for any common-law indemnification claim against the employer.

The third-party plaintiff opposed the motion, arguing that discovery was needed before the motion to dismiss could be granted and that in any event, the disclaimer of coverage for the common-law indemnification claim was untimely under N.Y. Ins. Law § 3420(d) based on when the insurer first learned of underlying plaintiff’s employment status. With regard to the timing of the disclaimer, Mr. Suben argued that employment status was confirmed only by receipt of underlying plaintiff’s Bill of Particulars, and coverage was denied within twenty days thereafter.

By order dated April 5, 2018, the Honorable Leonard D. Steinman, J.S.C., granted TLSS’ motion in full, finding that the opposition failed to identify discovery necessary to oppose the motion and further finding that the insurer’s disclaimer based on unambiguous policy exclusions was timely as a matter of law.

Maxum Indem. Co. v. Midsun Group, Inc., Index No. 6005129/2017 (Sup. Ct. Nassau Co. slip op. Apr. 5, 2018).