Superstorm Sandy has been listed as the second most costly storm, with Hurricane Katrina taking the number one position, and now the federal court system is starting to reflect the large number of improperly handled claims. The number of court cases is making the news in New York, where, thus far, most of the cases seem to be filed in the Eastern District Federal Court in Brooklyn, New York.
Merlin Law Group’s own Javier Delgado was interviewed in New York Law Journal article, Eastern District Awash in Sandy Insurance Cases.1 Since over 800 Superstorm Sandy coverage cases are currently pending in the Eastern District of New York, Chief Judge Amon is deciding the best way for the court to handle all of these cases. Thus far, Judge Amon has opened In re Hurricane Sandy Cases 14mc41, and assigned three magistrate judges to become involved. He convened the lawyers early this month.
The trio – Magistrate Judges Cheryl Pollak, Gary Brown, and Ramon Reyes, Jr. – has submitted a case management plan to address matters such as discovery schedules and settlement discussions. The Eastern District’s Board of Judges, comprised of all the jurisdiction’s judges, is now reviewing the proposal and will approve the final order
While many policyholders tried the alternative resolution process of mediation with the Department of Financial Services, as of February 10th, only 1460 out of 2708 claims settled with this program.
Benjamin Rajotte, director of the disaster relief clinic at Touro College Jacob D. Fuchsberg Law Center, said:
[T]he main problems are, the insurers are undervaluing what everyone – the homeowner, the public adjuster – has agreed has been damaged. And number two, they’re not considering the proper scope of repairs – what it would take to fix it.
In the article, Javier discussed the state of litigation in New York, and described details of the improperly paid claim of his client, a neuroradiologist:
Javier Delgado of the Merlin Law Group said there could be more suits to come. With main offices in Tampa but also locations including New York and New Jersey, the firm is representing commercial and residential plaintiffs in "several hundred" Sandy cases that are mostly in federal court.
Though some insurance policies on wind storm damage have a one-year window on when its determination can be challenged, Delgado said the "norm" is a two- year statute of limitations.
Despite the possibility of more lawsuits, Delgado, a former adjuster and insurance defense attorney, said t here is a "huge percentage of attrition" between policyholders who are denied and those who press on in court.
That drop-off, he said, was attributable to a possible plaintiff’s flagging will and also the fact that "some people don’t even have the time."
One of Delgado’s client’s, Dr. Harold Parnes, a certified diagnostic radiologist and neuroradiologist in Brooklyn, had three policies on his business through CNA and put in a claim after getting 40 inches of sewage in the office building’s basement.
Parnes said he put in a claim for "millions of dollars" but has only received a "small percentage."
How will the cases in the Eastern District be handled?
Accordingly to the article,
[A]bout 250 attorneys trekked and trudged through cold, snowy weather on Feb. 5 to the Eastern District’s ceremonial courtroom from as far away as Louisiana to discuss how to handle the cases.
Prior to the proceedings, the magistrate judges sought input from the attorneys on potential grouping or streamlining. Yet by and large, attorneys for both the plaintiffs and defense urged against grouping, saying the cases were too individual.
Just yesterday, the magistrate judges entered Case Management Order No. 1, giving an update that Merlin Law Group’s own Javier Delgado was named as Plaintiffs Liason Counsel along with Tracey Rannals Bryan of Gauthier, Houghtaling & Williams. The two will coordinate efforts of all policyholders with the case management plan established by the magistrates.
1 Andrew Keshner and Tania Karas, New York Law Journal, February 13, 2014. http://www.newyorklawjournal.com/id=1202642611902/Eastern+District+Awash+in+Sandy+Insurance+Cases%3Fmcode=0&curindex=0&curpage=ALL (paid subscription required).