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Utica Mutual Insurance Co. v. American Re-Insurance Co.

United States District Court, N.D. New York

April 27, 2015

UTICA MUTUAL INSURANCE COMPANY, Plaintiff,
v.
AMERICAN RE-INSURANCE COMPANY a/k/a MUNICH REINSURANCE AMERICA, INC., Defendant.

FELT, EVANS LAW FIRM KENNETH L. BOBROW, ESQ., Clinton, New York, Attorneys for Plaintiff.

SIMPSON, THACHER LAW FIRM - NEW YORK OFFICE MARY KAY VYSKOCIL, ESQ., ALEXANDER BLANK SIMKIN, ESQ., JONATHAN S. ZELIG, ESQ., New York, New York, Attorneys for Plaintiff.

HUNTON, WILLIAMS LAW FIRM - McLEAN, VIRGINIA OFFICE SYED S. AHMAD, ESQ., McLean, Virginia, Attorneys for Plaintiff.

RUBIN, FIORELLA LAW FIRM BRUCE M. FRIEDMAN, ESQ., JAMES E. MERCANTE, ESQ., New York, New York, Attorneys for Defendant.

PETRONE, PETRONE LAW FIRM - UTICA OFFICE LORI E. PETRONE, ESQ., Utica, New York, Attorneys for Defendant.

MEMORANDUM-DECISION AND ORDER

MAE A. D'AGOSTINO, District Judge.

I. INTRODUCTION

On December 22, 2014, Defendant, American Re-Insurance Company a/k/a Munich Reinsurance America, Inc. ("MRAm"), removed this case pursuant to 28 U.S.C. §§ 1441 and 1446. See Dkt. No. 1. On January 21, 2015, Plaintiff Utica Mutual Insurance Company ("Utica") filed a motion to remand, which is currently before the Court. See Dkt. No. 13.

II. BACKGROUND

A. The state court action

On December 24, 2014, Utica filed a complaint in state court alleging breach of contract, and asked the state court to issue a declaratory judgment pursuant to C.P.L.R. § 3001, to clarify "the parties' rights and obligations under certain reinsurance contracts entered into between Utica and [MRAm]." Dkt. No. 15-1 at 3. The complaint also named Transatlantic Reinsurance Company ("Transatlantic"), "a corporation organized under the laws of the State of New York, with its principal place of business in New York, New York." Id. at 4. As Utica is also incorporated under New York law, with its principal place of business is in New Hartford, New York, MRAm was prevented from removing the case to federal court because complete diversity did not exist between the parties. Id. On November 24, 2014, the state court severed Utica's claims against MRAm and Transatlantic. See Dkt. No. 15-4. The court reasoned that

[e]ven if permissive joinder of the two defendants in this matter may be proper, severance pursuant to CPLR § 1003 is appropriate in the interest of justice as a matter of discretion. Litigation involving these two defendants would impose upon each an undue burden because it would cause each of them to be indirectly involved in plaintiff's claims against the other. This is particularly true in the case of discovery, motion practice, and other pre-trial proceedings. Further, as a matter of judicial economy and consistency, severance will afford defendant Munich Re the opportunity to remove the claim against it to federal court where a similar claim involving the same parties, and the same or similar reinsurance contracts has been adjudicated, and is on appeal. It is also likely that severance will afford each defendant with a more expeditious resolution of the respective claims against it.

Id. at 6. Utica has appealed the severance order to the Fourth Department Appellate Division. ...


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