Amaro Food Enterprises Inc. v. Liberty Mutual Insurance

Background

Amaro Food Enterprises, Inc. brought a breach-of-contract action against Liberty Mutual Insurance concerning a marine cargo insurance policy. Amaro alleged that a power surge on or about July 13, 2022, damaged freezer space at its warehouse and caused more than $300,000 in food spoilage. Amaro reported the incident and submitted a claim, but Liberty Mutual denied the claim in a March 29, 2023 letter.

The policy stated that a lawsuit to recover under the policy had to be started within 12 months after the calendar date when the physical loss or damage began. Amaro first sued in New Jersey on May 30, 2023. The New Jersey case was dismissed for lack of subject-matter jurisdiction, and the state court later denied Amaro’s request for reconsideration. Amaro filed the same claim in New York state court on July 21, 2024; Liberty Mutual removed the case to federal court.

Motion and arguments

Liberty Mutual initially moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which concerns failure to state a legally sufficient claim. Because Liberty Mutual had already answered the complaint, the court treated the motion as one for judgment on the pleadings under Rule 12(c). The court applied the same standard used for a Rule 12(b)(6) motion and accepted the complaint’s well-pleaded factual allegations as true for purposes of the motion.

Liberty Mutual’s only argument was that the policy’s one-year lawsuit deadline barred Amaro’s claim. Amaro did not challenge the enforceability of that provision. Instead, Amaro argued that the earlier New Jersey lawsuit satisfied the policy’s requirement or, alternatively, that the provision was ambiguous and should be interpreted against Liberty Mutual.

Court’s reasoning

The court held that the policy language was unambiguous. It interpreted the reference to a “suit, action or proceeding” as referring to the present lawsuit, not an earlier case filed in a different court system and state. The court also determined that the limitations period began with the July 13, 2022 food-spoilage event, which Amaro did not dispute.

The present lawsuit was filed on July 21, 2024, more than one year after the loss. The court considered Amaro’s suggestion that equitable estoppel might prevent Liberty Mutual from relying on the deadline. Even assuming the one-year period could be paused while the New Jersey case was pending, the court calculated that 533 days had elapsed outside that period: 321 days before the New Jersey case began and 212 days after that case ended before Amaro filed in New York. The court therefore concluded that equitable estoppel could not preserve the claim.

Disposition

The court granted Liberty Mutual’s motion for judgment on the pleadings. It directed the Clerk of Court to enter judgment for Liberty Mutual, terminate the motion, and close the case.