The opinion
UNITED STATES DISTRICT COURT CLERK
EASTERN DISTRICT OF NEW YORK 1/23/2025 3:40 pm
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U.S. DISTRICT COURT
SCOTTSDALE INSURANCE CO.,
EASTERN DISTRICT OF NEW YORK
LONG ISLAND OFFICE
Plaintiff,
MEMORANDUM OF
DECISION AND ORDER
-against-
Civil Action
No. 23-3494 (GRB) (ARL)
EMPIRE STATE MEDI-CAB, INC., FOREST MANOR
CARE CENTER, INC. d/b/a GLEN COVE CENTER FOR
NURSING & REHABILITATION, KNICKERBOCKER
DIALYSIS, INC. d/b/a PORT WASHINGTON DIALYSIS
CENTER, HOWARD SIERS, as Executrix of the estate of
DAVID SIERS,
Defendants.
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GARY R. BROWN, United States District Judge:
Plaintiff Scottsdale Insurance Company commenced this action seeking a declaratory
judgment, pursuant to 28 U.S.C. §§ 2201-2202, that it owes no further duty to defend or
indemnify defendant Empire State Medi-Cab Inc. (“Empire State”) under the terms of a
commercial general liability insurance policy. Complaint, Docket Entry (“DE”) 1 ¶ 1. By
extension, plaintiff seeks a declaration that the remaining parties, Forest Manor Care Center, Inc.
d/b/a Glen Cove Center for Nursing & Rehabilitation (“Glen Cove”), Knickerbocker Dialysis,
Inc., d/b/a Port Washington Dialysis Center (“Port Washington”), and Howard Siers, as Executor
of the Estate of David Siers (“Siers”) have no rights as against plaintiff.1 Id. ¶ 8. Presently
before the Court is plaintiff’s motion for (i) default judgment against Empire State and (ii)
1 Plaintiff included these three defendants in this action because they have “asserted claims against Empire State,
and thus have a potential interest in the judgment sought herein.” DE 1 ¶ 8.
summary judgment against the remaining defendants. See DE 38. Discovery is complete. DE
36. For the reasons stated herein, both motions are GRANTED.
Factual Background
This declaratory judgment action arises out of an action brought by Siers in the
Supreme Court of the State of New York, Queens County (“state court action”) on April 27,
2014, asserting claims for negligence and wrongful death. See DE 1-2. Siers alleges that the
decedent suffered bodily injuries, and ultimately died, due to an accident that occurred while
being transported from Glen Cove to Port Washington. See id. ¶ 22.
Empire State is in the business of “transporting nursing home residents to and from
medical care facilities for scheduled appointments.” Id. ¶ 10. On the day of the accident,
Empire State “transported [the decedent] from Glen Cove … to Port Washington … for
treatment.” DE 38-12 at 3. At Port Washington, a nurse “touched [the decedent’s] legs and he
screamed.” Id. “Subsequently he was taken to [a hospital], where he was diagnosed as having
pelvic and bilateral acetabular fractures.” Id. He died nearly four months later. Id.
On July 23, 2024, the judge in the state court action denied summary judgment
motions from Empire State, Glen Cove, and Port Washington, finding that there were triable
issues of fact regarding each party’s liability. Id. at 7. In finding that Empire State could not
disprove liability at summary judgment, the state judge observed that (i) statements from the
decedent to Siers that the decedent fell at Glen Cove were hearsay, (ii) a Glen Cove employee
testified during deposition that the decedent appeared in good condition before being transported
by Empire State, and (iii) the hospital’s discharge report stated that the decedent could not recall
where he sustained the injury. Id. at 3-4.
While not a named defendant in the state court action, plaintiff issued a commercial
general liability insurance policy to Empire State that covers the period when the accident
occurred. See DE 38-8. The policy contains two exclusions relevant to this motion. The first
exclusion (“auto exclusion”) states that the policy does not require plaintiff to defend or
indemnify Empire State for “‘[b]odily injury’ or ‘property damage’ arising out of the ownership,
maintenance, use or entrustment to others of any … ‘auto’ … owned or operated by or rented or
loaned to any insured.” Id.
The policy also contains a section (“bodily injury exclusion”) that states that the
insurance does not cover:
1. “bodily injury” which occurs while “occupying” an “auto,” or
2. “bodily injury” to any person being transported or assisted by you,
your employees, or your subcontractors:
a. From the place where they are accepted for movement into an
“auto,” or
b. From an “auto” to the place where they are finally delivered.
Id.
Plaintiff commenced this action on May 9, 2023, seeking a declaratory judgment
that it had no further obligation to defend or indemnify Empire State in the state court
action. DE 1 ¶ 1. Plaintiff seeks a default judgment against Empire State, which has
failed to answer in this action. DE 38 at 6. The Court has issued a certificate of default.
DE 26. Plaintiff seeks summary judgment against the remaining defendants, arguing that
based upon the auto exclusion and the bodily injury exclusion, the policy does not require
plaintiff to defend and indemnify Empire State in the state court action. Id.
Discussion
Declaratory Judgment
The Declaratory Judgment Act states that “[i]n a case of actual controversy within
its jurisdiction, … any court of the United States, upon the filing of an appropriate
pleading, may declare the rights and other legal relations of any interested party seeking
such declaration, whether or not further relief is or could be sought.” 28 U.S.C. §
2201(a). “[A] court may exercise its discretion to issue a declaratory judgment, but only
in cases where the party seeking the declaratory judgment can demonstrate the existence
of an actual case or controversy.” Gov’t Emps. Ins. Co. v. Infinity Health Prods., Ltd.,
No. 10-CV-5611 (JG)(JMA), 2012 WL 1427796, at *4 (E.D.N.Y. Apr. 6, 2012), adopted,
2012 WL 1432213 (E.D.N.Y. Apr. 25, 2012). The relevant inquiry is “whether the facts
alleged, under all the circumstances, show that there is a substantial controversy, between
parties having adverse legal interests, of sufficient immediacy and reality to warrant the
issuance of a declaratory judgment.” Olin Corp. v. Consol. Aluminum Corp., 5 F.3d 10,
17 (2d Cir. 1993) (quoting Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S.
270, 273 (1941)). “Declaratory relief is appropriate (i) where the judgment will serve a
useful purpose in clarifying and settling the legal relations in issue, or (ii) when it will
terminate and afford relief from the uncertainty, insecurity and controversy giving rise to
the proceedings.” Gov’t Emps. Ins. Co. v. Jacques, 14-CV-5299 (KAM)(VMS), 2017
WL 9487191, at *9 (E.D.N.Y. Feb. 13, 2017) (internal quotation marks and citation
omitted), adopted, 2017 WL 1214460 (E.D.N.Y. Mar. 31, 2017).
Here, declaratory relief is appropriate. The state court action presents the
requisite case or controversy because Empire State could attempt to collect from plaintiff
if found liable. See Am. Eur. Ins. Co. v. Tirado Iron Works & Fence, Inc., No. 19-CV-
6851 (EK)(RLM), 2021 WL 7830143, at *5 (E.D.N.Y. Oct. 20, 2021) (finding that a
plaintiff seeking a declaration that it had no obligation to defend or indemnify any party
in an action pending in New York state court was entitled to a declaratory judgment).
Given the fact that the state court action appears headed to trial, declaratory relief here
could relieve plaintiff “from the uncertainty” of potentially having to defend and
indemnify Empire State. Jacques, 2017 WL 9487191, at *9.
Default Judgment
After the Clerk of the Court enters a certificate of default, the district court may,
on a plaintiff’s application, enter a default judgment if a defendant “has failed to plead or
otherwise defend” an action. Fed. R. Civ. P. 55. Upon default, all well-pleaded
allegations in the complaint are deemed true. See Finkel v. Romanowicz, 577 F. 3d 79,
84 (2d Cir. 2009). “Courts have discretion to award declaratory relief in connection with
a default judgment motion.” Tirado Iron Works, 2021 WL 7830143, at *5 (quoting
Scottsdale Ins. Co. v. Top Grade Excavating N.Y. Inc., No. 20-CV-3510 (ENV)(VMS),
2021 WL 7908042, at *5 (E.D.N.Y. Aug. 13, 2021)). “In determining damages,
including declaratory relief, courts may evaluate the affidavits and documentary evidence
submitted by the plaintiff or conduct an evidentiary hearing.” Scottsdale Ins. Co., 2021
WL 7908042, at *6.
Under New York law, “[a]n insurer cannot be obligated to defend if there is no
legal or factual allegation in the underlying complaint for which the insurer might
eventually have to indemnify the insured.” Commercial Union Assurance Co., PLC v.
Oak Park Marina, Inc., 198 F.3d 55, 59 (2d Cir. 1999). “To negate coverage by virtue of
an exclusion, an insurer must establish that the exclusion is stated in clear and
unmistakable language, is subject to no other reasonable interpretation, and applies in the
particular case.” Continental Cas. Co. v. Rapid-American Corp., 593 N.Y.S.2d 966, 972
(1993) (citations omitted).
Here, the Clerk of the Court has entered a certificate of default. DE 38-4. The
evidence in the record supports plaintiff’s well-pleaded complaint and establishes that
plaintiff is entitled to a default judgment against Empire State. If the decedent’s injury
occurred when Empire State transported him from Glen Cove to Port Washington, the
auto exclusion applies. DE 1 ¶ 13; DE 38-8. If the injury did not occur during transport,
the bodily injury exclusion, which excludes coverage for any injuries sustained as a result
of “being transported or assisted” by Empire State employees or subcontractors, applies.
DE 1 ¶ 14; DE 38-8. In short, if Empire State is found liable, one or both exclusions
apply. In light of plaintiff’s complaint, the evidentiary record, Empire State’s failure to
respond, and the certificate of default, the Court grants plaintiff’s motion for a default
judgment against Empire State.
Summary Judgment
Motions for summary judgment are decided under the oft-repeated and well
understood standard for review of such matters as discussed in Bartels v. Inc. Vill. of
Lloyd Harbor, 97 F. Supp. 3d 198, 211 (E.D.N.Y. 2015), aff’d sub nom. Bartels v.
Schwarz, 643 Fed. App’x. 54 (2d Cir. 2016), which discussion is incorporated by
reference herein. “In New York State, an insurance contract is interpreted to give effect
to the intent of the parties as expressed in the clear language of the contract.” Vill. of
Sylvan Beach, N.Y. v. Travelers Indem. Co., 55 F.3d 114, 115 (2d Cir. 1995). “If the
provisions are clear and unambiguous, courts are to enforce them as written.” Id.
Here, the insurance policy unambiguously excludes from coverage the decedent’s
injuries. The auto exception proves that the policy does not cover injuries sustained
while Empire State transported the decedent. DE 38-8. While Siers argues that it is
possible that the decedent fell at Glen Cove “prior to being transported by Empire State,
but while in the presence of [an] Empire State employee,” DE 39 at 3, this argument
ignores the language of the policy, which excludes coverage for a bodily injury occurring
to “any person being transported or assisted by you, your employees, or your
subcontractors.” DE 38-8 (emphasis added). Even if Siers could prove that Empire State
was liable for an injury that occurred at a time other than during the transport of the
decedent, the bodily injury exception indicates that the policy does not cover an injury in
which an Empire State employee or subcontractor “assisted” the decedent. Id.
Regardless of whether Empire State’s alleged negligence occurred while
“transport[ing]” or merely “assist[ing]” the decedent, the policy does not require plaintiff
to defend or indemnify Empire State in the state court action. DE 38-8. Therefore,
summary judgment against the remaining defendants is warranted.
Conclusion
For the reasons set forth herein, plaintiff’s motions for default judgment against
Empire State and summary judgment against the remaining defendants are granted. All
defendants shall be bound by this judgment.
SO ORDERED.
Dated: Central Islip, New York
January 23, 2025
/s/ Gary R. Brown
GARY R. BROWN
United States District Judge