defendants who drafted it undoubtedly thought they were saying.
As in Boutari, the clause is permissive rather than mandatory;
it gives the parties "the right to take any dispute between
themselves and BLa SuisseH" to a Swiss court of competent
jurisdiction, but it does not compel them to do so or preclude
them from suing elsewhere. Therefore, as long as there is
personal jurisdiction over the defendants in this District, they
can be sued here.
This Court Has Personal Jurisdiction Over the Defendant La
Suisse (but not Rentenanstalt)
Except for Rentenanstalt, which is not an a/k/a for La Suisse
but rather is its parent company, the challenges to personal
jurisdiction are unpersuasive.
From the record before the Court, it seems clear that La
Suisse's contacts with the Southern District of New York related
to the sale of these particular insurance policies more than
satisfy the constitutionally mandated "minimum contacts" test of
International Shoe Co. v. Washington, 326 U.S. 310, 316, 66
S.Ct. 154, 90 L.Ed. 95 (1945). Like Magistrate Judge Fox, I
credit the evidence showing that La Suisse set up an exclusive
agency relationship (though it may not have been exclusive) with
Dr. Bernard Rosenberg, a Swiss attorney who is an associate of
Horowitz/Bituswiss. Rosenberg and his associates were engaged to
sell these policies in New York. As noted above, Horowitz, an
associate of Rosenberg's and a Hasidic Jew who lives and works in
this District, claims to have sold about half of the 7,000
policies himself, by calling and going to the homes of the
members of his community and soliciting their business. A London
insurance broker, Moses Krausz, representing Caruso, S.A., which
has offices in Liechtenstein, traveled to New York three times
for the purpose of explaining coverage, preparing and explaining
applications, advising on insurability, and performing similar
administrative acts in order to obtain customers for La Suisse.
Rosenberg, Horowitz and Krausz all aver that they were acting
under the auspices and at the direction of La Suisse. An
individual named Josef Rand, whose card identifies him as a
resident of Zurich and who held himself out as an agent of La
Suisse, met with plaintiffs Pal and Agi Weiss at their home in
Brooklyn (which, although not in the Southern District of New
York, is within the State of New York) on fifteen separate
occasions. There is absolutely no evidence in this record that
the activities of these persons here in the United States were
Thus, whether or not La Suisse is generally present in this
District, in the sense of having continual and systematic general
business contacts, it is hard to escape the conclusion that La
Suisse purposefully availed itself of activity within the State
of New York and the Southern District of New York in order to
peddle the insurance policies that are the subject of this
There are other contacts with New York that satisfy the
International Shoe test. For example, the policies were
delivered here. And although the policies state (in languages
that few if any of the plaintiffs spoke) that the premiums are to
be paid in Swiss francs in Switzerland, they were in fact paid
with American dollars in New York State. Under McGee v.
International Life Insurance Co., 355 U.S. 220, 223, 78 S.Ct.
199, 2 L.Ed.2d 223 (1957) — a case whose vitality in the context
of insurance has not diminished over time, as defendants
suggest*fn3 — that alone meets the constitutional minimum.
Besides minimum contacts, the other question to be considered
by this Court in assessing the propriety of an exercise of
personal jurisdiction is whether
it comports with traditional notions of fair play and substantial
justice. Where, as here, the plaintiff has met the minimum
contacts test, a finding of reasonableness is favored, unless the
defendant presents a compelling case that the presence of other
considerations would render jurisdiction unreasonable. See
Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560
(2d Cir.), cert. denied, 519 U.S. 1006, 117 S.Ct. 508, 136
L.Ed.2d 398 (1996). La Suisse has made no such showing on the
record before this Court. Rather, given La Suisse's extensive
purposeful activity in targeting the New York Hasidic community
for the sale of these highly unusual policies, the barriers to
obtaining any meaningful relief that the seemingly protective
Swiss courts appear to have placed in plaintiffs' way, and the
relative means that the two sides have for litigating here as
opposed to litigating in Switzerland, there appear to be
compelling considerations that render the exercise of personal
jurisdiction over La Suisse reasonable.
With constitutional objections to exercising jurisdiction over
La Suisse out of the way, I turn to the issue of service of
process. New York's long-arm statute provides that process may be
served on defendants outside the State of New York who transact
any business within the State or who contract anywhere (including
Switzerland) to supply goods or services in the state.
N YC.P.L.R. 302(a)(1); see Caronia v. American Reliable Ins.
Co., 999 F. Supp. 299, 303 (E.D.N.Y. 1998); Sunrise Industrial
Joint Venture v. Ditric Optics, Inc., 873 F. Supp. 765, 769-770
(E.D.N.Y. 1995); Insurance Co. of North America v. Pyramid Ins.
Co. of Bermuda Ltd., No. 92 Civ. 1816, 1994 Westlaw 88754 at
*2-*3, 1994 U.S. Dist. Lexis 2994 (S.D.N.Y. Mar. 16, 1994) (cases
cited and discussion therein); American Centennial Ins. Co. v.
Seguros La Republica, S.A., No. 90 Civ. 2370(JFK), 1991 Westlaw
60378 at *4-*6, 1991 U.S. Dist. Lexis 4546 (S.D.N.Y. Apr. 8,
1991); U.N.F. Services, Inc. v. Insurance Co. of North America,
236 A.D.2d 388, 389, 653 N.Y.S.2d 366, 367 (N.Y.App. Div. 1997);
Town of Hempstead v. Certain Underwriters at Lloyd's of London
et al., 148 A.D.2d 527, 538 N.Y.S.2d 862 (N.Y.App. Div. 1989). In
addition, New York specifically provides for service of process
on insurers who are not authorized to do business in the State
but who provide insurance to New Yorkers. N.Y. Ins. L. §§
1213(b)(1)(A), (C). It is quite clear on this record that the
conditions for invocation of that statute have been met as to La
The above discussion concerns only La Suisse. The learned
Magistrate Judge recommended that I deny Rentenanstalt's motion
to dismiss for lack of personal jurisdiction without prejudice,
and that the parties be permitted to take discovery concerning
the relationship between parent and subsidiary, to see if the
ordinary rule that the sins of the subsidiary do not confer
jurisdiction over the parent should be suspended in this case.
At the pre-discovery stage, plaintiffs may defeat a motion to
dismiss on jurisdictional grounds by making a prima facie showing
of jurisdiction. See Ball v. Metallurgie Hoboken-Overpelt,
S.A., 902 F.2d 194, 197 (2d Cir. 1990), cert. denied,
498 U.S. 854, 111 S.Ct. 150, 112 L.Ed.2d 116. New York courts may exercise
personal jurisdiction over a foreign corporation that is engaged
in a continuous and systematic course of "doing business" in the
state such that the corporation may be deemed to be "present" in
New York. See Delagi v. Volkswagenwerk A.G., 29 N.Y.2d 426,
430-31, 328 N.Y.S.2d 653, 278 N.E.2d 895 (1972). To establish
personal jurisdiction in a case such as the present one, where
plaintiffs claim that the foreign corporation is present in New
York on the basis of the activities here of its subsidiary, the
subsidiary must be functionally either an "agent" or a "mere
department" of the foreign parent. See Jazini v. Nissan Motor
Co., 148 F.3d 181, 184 (2d Cir. 1998) (citing Koehler v. Bank
of Bermuda Ltd., 101 F.3d 863, 865 (2d Cir. 1996)).
A subsidiary may be considered an "agent" of its parent if the
shows that the subsidiary "does all the business which the
[parent corporation] could do were it here by its own officials."
Id. (quoting Frummer v. Hilton Hotels Int'l., Inc., 20 N.Y.2d 737,
283 N.Y.S.2d 99, 229 N.E.2d 696, cert. denied,
389 U.S. 923, 88 S.Ct. 241, 19 L.Ed.2d 266 (1967)). In this case,
plaintiffs' complaint asserts simply that Rentenanstalt "holds a
beneficial or ownership interest in La Suisse" (Cplt. ¶ 12). This
ambiguous characterization is plainly insufficient to establish
an agency relationship within the meaning of Jazini. Nor do
plaintiffs' other submissions to this Court suggest a
principal-agent relationship between Rentenanstalt and La Suisse.
Alternatively, plaintiffs may obtain jurisdiction over
Rentenanstalt by showing that La Suisse is a "mere department" of
its parent. To do so, plaintiffs must establish four elements:
common ownership, financial dependency of the subsidiary on the
parent, a high degree of interference by the parent in the
selection of the subsidiary's executive personnel and disregard
of corporate formalities, and a high degree of control over the
marketing and operational policies of the subsidiary. See
Volkswagenwerk v. Beech Aircraft Corp., 751 F.2d 117, 120-22 (2d
Cir. 1984). Taking as true the assertion of both plaintiffs and
defendants that Rentenanstalt owns 94 percent of the publicly
traded shares of La Suisse, the common ownership factor is
satisfied. Plaintiffs attempt to satisfy the remaining factors by
pointing out, in their objections to Judge Fox's Report, that the
Chairman of La Suisse's Board also sits on Rentenanstalt's
Supervisory Board and is a member of La Suisse's Steering
Committee; that the Vice-Chairman of La Suisse's Board is also
the President of the Group Management of Rentenanstalt, and
likewise serves on La Suisse's Steering Committee; and that the
Chief Financial Officer of Rentenanstalt serves on La Suisse's
Board. However, the overlap of directors and officers between
parent and subsidiary alone does not render the subsidiary a
"mere department" for jurisdictional purposes. See Jazini, 148
F.3d at 185 (citing Porter v. LSB Indus., 192 A.D.2d 205,
600 N.Y.S.2d 867, 873 (1993)). What plaintiffs need — and have failed
— to demonstrate is a total "disregard for the separate corporate
existence of the subsidiary." Beech Aircraft, 751 F.2d at 120.
Plaintiffs further attempt to establish the "mere department"
status of La Suisse through the declaration of Moses Krausz. Mr.
Krausz is a former employee of Caruso, S.A., a firm that sold
policies similar to those at issue here to the Orthodox Jewish
community in New York as an agent for La Suisse. Specifically,
Mr. Krausz asserts that Rentenanstalt is "clearly and actively
involved in the negotiations between La Suisse and its
policyholders and agents" based on correspondence regarding a
meeting between attorneys for aggrieved La Suisse policyholders
and officers of Rentenanstalt (Krausz Decl. at 3). According to
Mr. Krausz, the meeting took place at Rentenanstalt's corporate
headquarters without the participation of any representatives
from La Suisse. Again, this isolated and vaguely described
interaction falls far short of the "complete domination"
necessary to secure jurisdiction over a corporate parent.*fn4
See Morris v. New York State
Dep't of Taxation and Finance, 82 N.Y.2d 135, 142, 603 N.Y.S.2d 807,
811, 623 N.E.2d 1157 (1993). Compare, e.g., Beech
Aircraft, 751 F.2d at 120-22 (jurisdiction over parent
established where subsidiary was wholly owned by parent, parent
provided subsidiary with 71 percent of its debt, subsidiary did
not hold directors meetings, parent controlled inventory levels,
accounting systems, insurance, and advertising, and prohibited
subsidiary from changing ownership or management without parent's
approval). In light of plaintiffs' failure to make even a minimal
showing of any basis for personal jurisdiction over La Suisse's
parent, further discovery is unwarranted, and the complaint is
dismissed as to Rentenanstalt.
All But the First Cause of Action Should be Dismissed on the
Of course, the fact that this Court has jurisdiction over La
Suisse does not mean that plaintiffs have adequately pleaded
claims entitling them to relief. Magistrate Judge Fox recommends
that eight of plaintiff's nine claims for relief — the Second
through Ninth Causes of Action — be dismissed. I concur.
The Second Cause of Action pleads a claim in common law fraud.
This claim could be dismissed under Fed. R.Civ.P. 9(b), since it
is inadequately pleaded in almost every respect — the allegations
are not specific as to the time, place and content of the alleged
misrepresentations and most of the allegations are made on
information and belief. However, to avoid unnecessary repleading,
I am dismissing it on the ground that it fails to state a cause
of action. A false promise can support a claim of fraud only
where it was collateral or extraneous to the terms of the
enforceable agreement in place between the parties.
International Cabletel Inc. v. Le Groupe Videotron Ltee.,
978 F. Supp. 483, 487 (S.D.N.Y. 1997). Here, plaintiffs do not specify
what representation(s) were made, by and to whom, in order to
induce each of them to purchase a policy. Nonetheless, it seems
quite clear that they have not alleged the making of any false
promise that was collateral or extraneous to the insurance
contract. To the contrary, viewing the allegations of the
complaint most favorably to plaintiffs, they assert only that
defendants made various false statements and representations that
were contrary to their actual intent with respect to the
performance of their contract obligations (Cplt. ¶ 160). This sort
of general allegation that a defendant entered into a contract
lacking the intent to perform is insufficient to support a claim
of fraud. So are allegations that the insurer was engaged in a
scheme to receive premiums without giving any benefits in return.
"Where a complaint does not state the specific promises or
omissions of material facts allegedly made by the insurer, it
alleges nothing more than a breach of the contract and any
covenants implied; it does not allege a cause of action for fraud
in the inducement." New York University v. Continental Ins.
Co., 87 N.Y.2d 308, 318-19, 639 N.Y.S.2d 283, 662 N.E.2d 763
(1995). I agree with Judge Fox that this is not a curable
pleading defect, but a fundamental flaw in plaintiff's theory of
recovery. Therefore, the motion to dismiss the Second Cause of
Action is granted.
The Third Cause of Action is brought under the Racketeering and
Corrupt Influences Act (RICO), 18 U.S.C. § 1961 et seq.
Plaintiffs allege, in substance (not to mention on information
and belief), that defendants maintained a pattern of racketeering
activity through mail fraud, wire fraud and conspiracy to violate
the rights of United States citizens and to deceive and defraud
plaintiffs in the purchase and placement of life insurance
policies. Whether this was intended to state a claim under
18 U.S.C. § 1962(c) or some other section of the RICO statute is, in
the end, irrelevant. For under any substantive RICO count, a
plaintiff must allege that the defendant, through a pattern of
activity, directly or indirectly invests in or maintains an
interest in an enterprise. The law is quite clear that the RICO
person (i.e., the defendant) cannot also be the RICO enterprise.
See Riverwoods Chappaqua Corp. v. Marine Midland Bank,
30 F.3d 339, 344 (2d Cir. 1994); Discon, Inc.v. NYNEX Corp.,
93 F.3d 1055, 1063-64 (2d Cir. 1996), cert. denied, ___ U.S. ___, 118
S.Ct. 49, 139 L.Ed.2d 14 (1997). In this complaint, La Suisse and
Rentenanstalt are both the RICO persons and the RICO enterprise
(Cplt. ¶¶ 169, 172). Accordingly, the civil RICO claim is
The Fourth Cause of Action alleges that defendants
discriminated against plaintiffs based upon their racial and
ethnic identity by refusing to pay benefits due under the terms
and conditions of the insurance policies, in violation of
42 U.S.C. § 1981, which provides:
All persons within the jurisdiction of the United
States shall have the same right in every State and
Territory to make and enforce contracts, to sue, be
parties, give evidence, and to the full and equal
benefit of all laws and proceedings for the security
of persons and benefit of all laws and proceedings
for the security of persons and property as is
enjoyed by white citizens. § 1981(a).
This claim is also fatally flawed, in that defendants have not
alleged circumstances or events from which racial animosity can
fairly be inferred. To establish a claim under § 1981, a
plaintiff must allege sufficient facts to support the following
elements: (1) the plaintiff is a member of a racial minority; (2)
an intent to discriminate on the basis of race, and (3) the
discrimination concerned one or more of the activities enumerated
in the statute (in this case the making and enforcing of
contracts). See Mian v. Donaldson, Lufkin & Jenrette Securities
Corp., 7 F.3d 1085, 1087 (2d Cir. 1993). As Jews, plaintiffs
satisfy the first factor. See Shaare Tefila Congregation v.
Cobb, 481 U.S. 615, 618, 107 S.Ct. 2019, 2021, 95 L.Ed.2d 594
(1987) (recognizing individuals of Jewish ancestry as a distinct
race under § 1981).
To satisfy the second element, a plaintiff must "specifically
allege the events claimed to constitute intentional
discrimination as well as circumstances giving rise to a
plausible inference of racially discriminatory intent." Yusuf v.
Vassar College, 35 F.3d 709, 713 (2nd Cir. 1994). Here,
plaintiffs have alleged only that defendants "discriminated
against plaintiffs based upon their ethnic and racial identity"
by refusing to pay benefits and interest due or make loans under
the policies, intentionally procuring lapses under the policies,
failing to accept payment or recognize policy reinstatement
provisions as to plaintiffs, and failing to adequately compensate
plaintiffs for defendants' failure to comply with the terms of
the policy (Cplt. ¶ 191). The complaint neglects to identify any
circumstances or events, apart from plaintiffs' bare allegation,
that would, directly or indirectly, link the alleged breaches of
contract to plaintiffs' racial identity, and, as such, is "too
conclusory to survive a motion to dismiss." Albert v. Carovano,
851 F.2d 561, 572 (2nd Cir. 1988). See also Harary v. Allstate
Ins. Co., 983 F. Supp. 95, 99-100 (E.D.N.Y. 1997) (dismissing as
conclusory mere allegation that insurance claim was denied solely
by reason of Israeli ancestry). Compare, e.g., Williams v.
Greendolf, Inc., 735 F. Supp. 137, 139-40 (S.D.N.Y. 1990)
(finding that inference of racial animus could be drawn from §
1981 plaintiff's allegation that employer told him employment
would be permanent but after discovering that plaintiff was
African-American hired plaintiff only on temporary basis and
However, plaintiffs should be permitted to amend their
complaint in order to specify the requisite circumstances and
events of racial animosity. In the Second Circuit, civil rights
complaints are to be construed liberally. See Mian v. Donaldson,
Lufkin & Jenrette Securities Corp., 7 F.3d 1085, 1087 (2d Cir.
1993) (citing Leatherman v. Tarrant County Narcotics
Intelligence and Coordination Unit,
507 U.S. 163, 168, 113 S.Ct. 1160, 1162-63, 122 L.Ed.2d 517
(1993)). A court should not grant a motion to dismiss "without
granting leave to amend at least once when a liberal reading of
the complaint gives any indication that a valid claim might be
stated." Branum v. Clark, 927 F.2d 698, 705 (2d Cir. 1991). In
the present case, Judge Fox's Report appears to recommend
dismissal with prejudice of plaintiffs' § 1981 claim, on the
rationale that because plaintiffs' witnesses testified that the
policies at issue were created and marketed specifically for
Orthodox and Hasidic Jewish persons, it would be logically
inconsistent to allow plaintiffs to argue that coverage was
denied out of racial animus. This conclusion is not self-evident.
That the policies were developed for a specific racial group does
not inexorably rule out the presence of discriminatory intent in
La Suisse's denial of benefits and reinstatement. Therefore,
viewing plaintiffs' complaint under the permissive standard of
Mian, plaintiffs may yet be able to specify circumstances and
events necessary to state a viable § 1981 claim, and should be
afforded the opportunity to do so.*fn5
The Fifth Cause of Action alleges that defendants violated §
349 of the New York General Business Law. That statute prohibits
the use of deceptive practices with respect to consumer products
that have a broad impact on consumers at large. The New York
Court of Appeals recently ruled that an insurance contract that
involved sophisticated parties did not fall within the ambit of
the General Business Law. See New York University v. Continental
Ins. Co., 87 N.Y.2d 308, 321, 639 N.Y.S.2d 283, 662 N.E.2d 763
(1995). Magistrate Judge Fox concluded that these insurance
contracts fell within the New York University exception to §
349, because the essence of plaintiffs' allegations — that
defendants failed to pay the benefits due under their insurance
policies — is not a deceptive practice that has a broad impact on
consumers at large. I agree with the learned Magistrate Judge. As
Judge Mukasey recently ruled in a similar case, Allahabi v. New
York Life Ins. Co., No. 98 Civ. 4334(MBM), 1999 Westlaw 126442
at *2 (S.D.N.Y., Mar.10, 1999), "Although such conflicts [i.e.,
nonpayment of benefits] are the sort that could potentially arise
between any insured and insurer, the specific allegations at
issue here are `unique to the parties' and do not have any
`broader impact on consumers at large.'" It is hard to imagine a
set of circumstances where the dispute is more "unique to the
parties" than this one, which has its genesis in the cultural
differences between the plaintiffs — a self-admitted separate
community that endeavors to stand apart from society generally —
and an alien insurer that apparently knew little or nothing of
their special lifestyle. The motion to dismiss is granted.
The Sixth Cause of Action, as Judge Fox observed, merely
shoehorns plaintiffs' complaints about breach of contract into a
new shoe: breach of fiduciary responsibility. As plaintiffs do
not allege a single fact from which a trier of fact could
conclude that their relationship with defendants or their agents
was imbued with
elements of "trust and confidence," so as to render it more than
an arm's length business association, their claim cannot stand.
This was a business transaction, nothing more; caveat emptor, not
trust and confidence, was the rule of the day. See Dornberger v.
Metropolitan Life Ins. Co., 961 F. Supp. 506, 546 (S.D.N Y
1997). The Sixth Cause of Action is dismissed.
The Seventh Cause of Action is labeled conversion. However, it
is well settled that a breach of contract cannot also be a tort.
Defendants cannot convert what plaintiffs claim under a contract.
This claim is dismissed.
The Eighth Cause of Action alleges more of the same. It is
denominated Conspiracy to Misappropriate and Defraud. Magistrate
Judge Fox characterizes the claim as follows: "In this context La
Suisse and Rentenanstalt have conspired essentially to give
plaintiff, the policyholders, a hard time" (R & R at 28). In
other words, defendants are alleged to have breached their
contract with their insureds. Plaintiffs are reminded that there
is no tort of conspiracy in New York; rather, conspiracy may be
alleged only to connect someone to an otherwise actionable tort
committed by another. See Ferguson v. Meridian Distribution
Services, Inc., 155 A.D.2d 642, 548 N.Y.S.2d 233 (N.Y.App. Div. 198
9). Plaintiffs claim that La Suisse and its parent have
actually breached their contractual relationship with their
insureds. They have no separate claim that the same parties have
conspired to do what they did. This cause of action, too, is
Finally, we come to the Ninth Cause of Action, which is labeled
Economic Duress. In it, plaintiffs contend that defendants'
efforts to compromise the claims that underlie this action were
of a threatening nature and that they constituted duress — duress
to which the plaintiffs apparently did not succumb. Of course,
there is no such cause of action; duress is a defense, and one
that can be asserted only in the most extreme circumstances.
Here, the settlement talks failed and plaintiffs sued. They were
not coerced into doing anything at all. Judge Fox conjectures,
and I agree, that plaintiffs are here trying to invent some sort
of claim that will entitle them to punitive damages, which are
not recoverable for breach of contract. See Rocanova v.
Equitable Life Assurance Society of U.S., 83 N.Y.2d 603,
612 N.Y.S.2d 339, 342, 634 N.E.2d 940, 943 (1994). Their effort
fails. The Ninth Cause of Action is dismissed.
This leaves the First Cause of Action, which is the real
gravamen of this case: plaintiffs' claim for breach of contract
due to defendants' failure to honor their demands for payment
under the policies. Magistrate Judge Fox correctly observes that
this claim as pleaded would not be used by a professor of civil
procedure in a first year law school class to teach her students
the art of pleading. His recommendation is that the claim be
dismissed, but with leave to replead. I conclude that repleading
is not necessary; and since the First Cause of Action
unquestionably states a claim for relief, I deny the motion to
The long and the short of Judge Fox's reasoning appears to be
that plaintiffs did not specifically particularize which of La
Suisse's bad acts (as pleaded in Cplt. ¶ 26) were directed toward
each individual plaintiff. But this is not a fraud claim, and
there is no requirement in the Federal Rules of Civil Procedure
that the details of a breach of contract claim be pleaded with
particularity. Instead, the short, plain notice rule of
Fed.R.Civ.P. 8 applies. What defendants ask the Court to require
is a complaint that substitutes for a bill of particulars. When
fraud is alleged, that level of detail is required. When breach
of contract is alleged, it is not.
As to each plaintiff, the complaint pleads the existence of the
policy, the payment of requisite premiums, the satisfaction of
the condition precedent to payment as stated on the face of the
policy, and the failure and refusal to pay despite demands having
been made. In the
specific cases of plaintiffs Weinstock, Rubin, Engel, Askenazi,
Hillman, Hirsch, Wieder, Kaufman, Rubin, Epstein, and Lunger, it
pleads the existence of the policy and payment of premiums and
failure to reinstate the policy after failing to give notice of
lapse or having wrongfully induced a lapse. This is more than
adequate to survive a motion to dismiss. The motion is denied.
The Court extends its deepest gratitude to Judge Fox and his
staff for their hard work on the extremely lengthy record
presented by the parties.
It has been represented, both to me and to Magistrate Judge
Fox, that the policies were eventually paid. Judge Fox warned
plaintiffs that they would be bound by that representation, and
they made it anyway, so presumably it is true. That leaves the
Court with only a claim for interest due to the allegedly late
payment — the detritus of the sole remaining cause of action, for
breach of contract — and a possible claim of racial
discrimination as to which there are obvious defenses.
Following service of an amended complaint, the matter is
referred back to Judge Fox, to see if he can broker a settlement.
If not, I will discuss with the parties the possibility of trying
this case on stipulated facts. The issues that remain are few in
number and narrow in scope. There is no longer a lot of money at
stake. It makes little sense to move forward on all cylinders.
This constitutes the decision and order of the Court.