The opinion
American Tr. Ins. Co. v Allure Recovery Inc.
2026 NY Slip Op 30902(U)
March 11, 2026
Supreme Court, New York County
Docket Number: Index No. 650556/2025
Judge: Emily Morales-Minerva
Cases posted with a "30000" identifier, i.e., 2013 NY Slip
Op 30001(U), are republished from various New York
State and local government sources, including the New
York State Unified Court System's eCourts Service.
This opinion is uncorrected and not selected for official
publication.
file:///LRB-ALB-FS1/Vol1/ecourts/Process/covers/NYSUP.6505562025.NEW_YORK.001.LBLX049_TO.html[03/19/2026 3:45:56 PM]
FILED: NEW YORK COUNTY CLERK 03/12/2026 12:21 PM INDEX NO. 650556/2025
NYSCEF DOC. NO. 27 RECEIVED NYSCEF: 03/12/2026
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK: PART 42M
--------------------X
AMERICAN TRANSIT INSURANCE COMPANY, INDEX NO. 650556/2025
Petitioner,
MOTION DATE 0'2.127/2025
-v-
MOTION SEQ. NO. 001
ALLURE RECOVERY INC.,
Respondent.
DECISION+ ORDER ON
MOTION
-------------------'----X
The following e-filed documents, listed by NYSCEF document number (Motion 001) 2, 9, 10, 11, 12, 13,
14, 15, 16, 17, 18, 19,20,22,23,24,25,26
were read on this motion to/for VACATE- DECISION/ORDER/JUDGMENT/AWARD
APPEARANCES:
Larkin Farrell LLC, New York, New York (William Robert Larkin,
Esq., of counsel), for petitioner.
Israel Purdy LLP, Great Neck, New York (Michael Hoenig, Esq.,
of counsel), for respondent.
EMILY MORALES-MINERVA, J.S.C.
In this special proceeding, petitioner AMERICAN TRANSIT
INSURANCE COMPANY moves, by notice of petition (motion sequence
number 01), pursuant to CPLR § 7511, to vacate the arbitration
award issued by Arbitrator John Kannengieser, Esq., and
subsequently confirmed by Master Arbitrator Burt Feilich, Esq.,
in favor of respondent ALLURE RECOVERY INC.
Respondent opposes and cross-petitions for confirmation of
the arbitration award and reasonable attorneys' fees.
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page 1 of 10
Motion No. 001
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For the reasons explained below, petitioner's petition
(mot. seq. no. 01} is denied entirely, and respondent's cross-
petition is granted, in part.
BACKGROUND
On November 08, 2020, Patrichia Morales was injured in a
motor vehicle accident (see New York State Court Electronic
Filing System [NYSCEF] Doc. No. 01, petition). As a result of
the accident, Ms. Morales received medical treatment, including
durable medical equipment (DME} from respondent ALLURE RECOVERY
INC. for intermittent limb compressions of her left knee from
January 06, 2021, through February 16, 2021 (see id.; see also
NYSCEF Doc. No. 03, lower arbitration award, dated September 10,
2024} .
Thereafter, respondent submitted a no-fault benefit claim
to petitioner seeking reimbursement of durable medical equipment
provided to Ms. Morales, but Petitioner denied reimbursement of
said claim based on lack of medical necessity (see NYSCEF Doc.
No. 01, petition}. Specifically, petitioner relied on the peer
review report of Dr. Amit Khaneja, MD (see id.). As a result of
the denial, respondent initiated arbitration with petitioner
(see NYSCEF Doc. No. 05, motor vehicle no-fault insurance law
arbitration request form, dated February 21, 2024}.
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page2of10
Motion No. 001
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The American Arbitration Association (AAA) assigned the
action to Arbitrator John Kannengieser (Arbitrator Kannengieser)
pursuant to AAA Case No. 17-24-1337-4442, and on August 23,
2024, Arbitrator Kannengieser conducted a hearing (see NYSCEF
Doc. No. 03, lower arbitration award). Arbitrator Kannengieser
reviewed one disputed claim for $3,360.00 (see id.}. To support
its denial of the claim, petitioner submitted the peer review
report of Dr. Amit Khaneja, MD (see id.}.
Upon conclusion of the hearing and in consideration of the
evidence and testimony submitted, Arbitrator Kannengieser found
that (1) petitioner failed to submit any proof that it had
mailed any of the requisite verification requests to Ms. Morales
and/or respondent; that (2) petitioner's denial of Ms.
Morales'/respondent's claim was issued 31 days after the final
verification was received, in violation of 11 NYCRR 65-3.8
(a) (1); and that (3) because petitioner did not issue a timely
denial of the claim and/or that it did not prove it timely and
properly requested verification of the claim, petitioner was
precluded from relying on Dr. Amit Khaneja's peer review report
(see id., p 2). Accordingly, Arbitrator Kannengieser awarded
respondent $3,360.00 for the claim in dispute, plus statutory
interest, attorneys' fees, and filing fees (see id.).
Petitioner appealed, and the matter was assigned to Master
Arbitrator Burt Feilich, Esq. (master arbitrator) pursuant to
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page 3of10
Motion No. 001
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AAA Case No. 99-24-1337-4442 (see NYSCEF Doc. No. 14, master
arbitrator award, dated November 04, 2024}. The master
arbitrator affirmed Arbitrator Kannengieser's decision entirely,
holding:
~rn essence, respondent disagrees with the
factual and/or legal determinations made by
the arbitrator and is actually seeking a de
novo review of the evidence . . . although
respondent's master arbitration submission
acknowledges that [Arbitrator] Kannengieser
had precluded respondent from relying on its
peer review report to establish a defense
premised on lack of medical necessity [] it
otherwise did not contest in any manner the
correctness of the ruling that respondent's
denial of claim was untimely. Thus,
respondent has not provided any valid legal
and/or factual argument to disturb the
portion of the award finding that its denial
of claim was not timely issued and leading
to the preclusion from evidence of its peer
reviewer's report"
(id., p 5} .
Despite the two-tier arbitration process, petitioner
commenced the instant Article 75 proceeding, seeking vacatur of
the $3,360.00 award pursuant to CPLR § 7511 (b} (1) (iii} 1 (see
1 Section 7511 of the CPLR provides, as relevant here:
"(a) An application to vacate or modify an award may be made by a party
within ninety days after its delivery to him.
"(b) Grounds for vacating.
1. The award shall be vacated on the application of a party who either
participated in the arbitration or was served with a notice of
intention to arbitrate if the court finds that the rights of that party
were prejudiced by:
(iii) an arbitrator, or agency or person making the award
exceeded his power or so imperfectly executed it that a final and
definite award upon the subject matter submitted was not
made . . . "
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page 4 of 10
Motion No. 001
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NYSCEF Doc. No. 01, petition}. Petitioner contends that the
"arbitrator's decision was arbitrary and capricious, without
rational basis and incorrect as a matter of law" (id., p 13}.
Respondent opposes and cross-petitions, seeking
(1} confirmation of the arbitration award; and (2} attorneys'
fees pursuant to 11 NYCRR § 65-4.lO(j} (4} [governing master
arbitrator procedures] in the amount of $1,000.00 (see NYSCEF
Doc. No. 10, cross-petition}.
ANALYSIS
"It is a bedrock principle of arbitration law that the
scope of judicial review of an arbitration proceeding is
extremely limited" (Frankel v Sardis, 76 AD3d 136, 139 [1st Dept
2010], citing Matter of Silverman [Benmor Coats], 61 NY2d 299
[1984]). "Accordingly, an award will not be overturned unless
it is violative of a strong public policy, or is totally
irrational, or exceeds a specifically enumerated limitation on
the arbitrator's power" (Frankel, 76 AD3d at 139, quoting
Silverman, 61 NY2d at 308, and Board of Educ. of Dover Union
Free School Dist. V Dovr-Wingdale Teachers' Ass'n, 61 NY2d 913,
915 [1984] } .
An "arbitrator's interpretation of the issues and the scope
of their authority is accorded substantial deference, and [the]
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Motion No. 001
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Court will not overturn the decision unless there is no support
at all justifying the decision" (Roffler v Spear, Leeds &
Kellogg, 13 AD3d 308, 310 [1st Dept 2004] [emphasis added]).
Indeed, "a court cannot examine the merits of an arbitration
award and substitute its judgment for that of the arbitrator
simply because it believes its interpretation would be the
better one" {Matter of Arbitration Between Spence and State
Univ. of New York, 230 AD3d 1559, 1561 [4th Dept 2024], citing
Matter of New York State Correctional Officers & Police
Benevolent Ass'n, Inc. v State of New York, 94 NY2d 321, 326
[1999]). Therefore, "the party seeking to upset an arbitration
award bears a heavy burden" {Frankel, 76 AD3d at 140, citing
Lehman Bros., Inc. v Cox, 10 NY3d 743, 744 [2008]}.
Here, the petition must be denied because petitioner has
failed to establish any cognizable ground for vacatur under
CPLR § 7511 (b) (1) (iii}. Arbitrator Kannengieser determined,
upon a review of the evidence, that petitioner's denial of the
underlying claim was untimely and therefore, it was precluded
from relying on Dr. Amit Khaneja's report to establish a defense
based on lack of medical necessity (see NYSCEF Doc. No. 03,
arbitration award). The master arbitrator confirmed said award,
and found that petitioner "did not contest in any manner the
correctness of the ruling that [it's] denial of claim was
untimely" (NYSCEF Doc. No. 14, master arbitrator award).
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page &of 10
Motion No. 001
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Here, petitioner again fails to address this issue, and
instead argues that Arbitrator Kannengieser "ignored
petitioner's evidence" i.e., the peer review report of Dr. Amit
Khaneja's report (see NYSCEF Doc. No. 01, petition, p 12).
However, this is factually incorrect, as Arbitrator Kannengieser
specifically precluded the peer review report due to
petitioner's untimely denial of the underlying claim {see NYSCEF
Doc. No. 03, lower arbitration award). Petitioner's argument
that respondent was required to submit a rebuttal to it's
precluded peer review report is baseless and without merit.
Petitioner is merely disagreeing with the arbitrator's factual
and evidentiary findings, and that does not constitute a basis
for vacatur of an arbitration award under CPLR § 7511
(b) (1) {iii). Accordingly, the petition (mot. seq. no. 01) is
denied.
The Court now turns to respondent's cross-petition for
confirmation of the arbitration award, and attorneys' fees
pursuant to 11 NYCRR § 64-4.l0(j) (4) 2 in the amount of $1,000.00,
(see NYSCEF Doc. No. 10, cross-petition).
2 11 NYCRR § 65-410 (j) provides: "The following limitations shall apply to
the payment by insurers of applicant's attorney's fees for services rendered
in a master arbitration to resolve a no-fault dispute: (4) The attorney's fee
for services rendered in connection with a court adjudication of a dispute de
novo [] or in a court appeal from a master arbitration award and any further
appeals, shall be fixed by the court adjudicating the matter" (emphasis
added).
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page 7 of 10
Motion No. 001
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11 NYCRR § 65-4.10 (j) (4) "allows the prevailing party to
recover attorneys' fees 'for services rendered . . . in a court
appeal from a master arbitration award and any further appeals'"
(American Tr. Ins. Co. v Rutland Med. PC, 224 AD3d 531, 532 [1st
Dept 2024], quoting 11 NYCRR § 65-4.lO(j) (4)]). This applies to
attorneys' fees for "work in Supreme Court in opposing the
petition to vacate the arbitration award" as well as work
involved in appeals to the Appellate Division (id., citing
Matter of Country-Wide Ins. Co. v TC Acupuncture P.C., 179 AD3d
414, 414-415 [1st Dept 2020]; see also Geico Ins. Co. v AAAMG
Leasing Corp., 148 AD3d 703, 705 [2d Dept 2017]).
Here, non-party Michael Hoenig, Esq., attorney for
respondent, affirms that he expended two hours opposing the
petition and drafting the cross-petition, at an hourly rate of
$500.00 per hour, reflecting no-fault specialization and 20
years of experience (see NYSCEF Doc. No. 15, affirmation in
support of attorneys' fees by Michael Hoenig, Esq., dated
February 04, 2025, with time records attached thereto). The
Court finds this time reasonable, and awards attorneys' fees in
the amount of $500.00 per hour, for a total amount of $1,000.00
reflective of two hours of work.
The Court declines to award an additional $500.00 in
attorneys' fees for "the total time required to [] review file
and draft[] reply" to petitioner's opposition to the
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Motion No. 001
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cross-petition (see NYSCEF Doc. No. 25, affirmation in support
of additional attorneys' fees by Michael Hoenig, Esq., dated
February 24, 2025}.
Accordingly, it is hereby
ORDERED that the petition of petitioner AMERICAN TRANSIT
INSURANCE COMPANY to vacate the arbitration award in AAA Case
No. 17-24-1337-4442 and confirmed in AAA Case No. 99-24-1337-
4442 is denied in its entirety; it is further
ORDERED that respondent's ALLURE RECOVERY INC.'s cross-
petition to confirm the master arbitration award of Master
Arbitrator Burt Feilich, Esq., which affirmed the award of
Arbitrator John Kannengieser, Esq., is granted, and the award is
confirmed in all respects; it is further
ORDERED that respondent ALLURE RECOVERY INC.is awarded the
full claim amount of $3,360.00, plus statutory interest to be
calculated from February 21, 2024, attorneys' fees and costs as
awarded by Arbitrator John Kannengieser, Esq., and attorneys'
fees and costs as awarded by Master Arbitrator Bert Feilich,
Esq.; it is further
ORDERED that respondent's cross-petition for attorneys'
fees is granted, in part, and respondent is awarded $1,000.00 in
attorneys' fees; it is further
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page 9 of 10
Motion No. 001
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ORDERED that petitioner shall serve a copy of this decision
and order with notice of entry upon respondent within fifteen
days from the date of this decision and order; and it is further
ORDERED that the Clerk of Court shall enter judgment
accordingly.
THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.
03/11/2026
DATE
~
CHECK ONE: CASE DISPOSED NON-FINAL ISPOSITION
GRANTED 0 DENIED GRANTED IN PART □ OTHER
APPLICATION: SETTLE ORDER SUBMIT ORDER
CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT □ REFERENCE
650556/2025 AMERICAN TRANSIT INSURANCE COMPANY, vs. ALLURE RECOVERY INC., Page 10 of 10
Motion No. 001
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