100 Orchard Street, LLC v. The Travelers Indemnity Company of America
- Jesse Furman
- 1:20-cv-08452
- U.S. District Court · Southern District of New York
- 2
In 100 Orchard Street v. Travelers, Judge Furman denied remand because the alleged insurance dispute plausibly exceeds $75,000.
100 Orchard Street, LLC and The Travelers Indemnity Company of America. The motion to return the case to state court was denied, so the case remained in federal court while the plaintiff’s amended-complaint or opposition deadline and Travelers’ reply deadline were set.
What happened
100 Orchard Street, LLC, doing business as Blue Moon Hotel, asked Judge Furman’s federal court to return its insurance-coverage case against The Travelers Indemnity Company of America to New York state court. It argued that the amount at stake was too low for federal jurisdiction.
The court explained that disputes seeking a declaration about insurance coverage are valued by the value of what the lawsuit seeks. The hotel sought coverage for business-income and other losses under a policy providing $1,250,000 in coverage, including losses connected to COVID-19 and mandated closures. The court found that the alleged losses plausibly exceeded $75,000.
Judge Jesse M. Furman denied the motion to remand as meritless. The court also set deadlines for an amended complaint or opposition to Travelers’ pending motion to dismiss, and for Travelers’ reply.
The detailed version
- 100 Orchard Street, LLC v. The Travelers Indemnity Company of America · No. 1:20-cv-08452
- Jesse Furman
- Nov. 16, 2020
Background
100 Orchard Street, LLC, doing business as Blue Moon Hotel, filed a motion to remand, meaning to return the case to New York state court. Travelers had removed the case to federal court under 28 U.S.C. § 1332, which provides federal jurisdiction when the parties are citizens of different states and more than $75,000 is in controversy. The plaintiff argued that the amount-in-controversy requirement was not met.
Amount in Controversy
The court explained that when a case seeks declaratory or injunctive relief, the amount in controversy is measured by the value of the subject of the lawsuit. The plaintiff sought a declaration requiring insurance coverage under a policy providing $1,250,000 for business-income and extra-expense losses related to COVID-19. The requested coverage included three months of total business-income loss, at least two months of partial business-income loss, lost rental income from a commercial tenant, additional expenses, and future income losses from mandated New York City closures. The plaintiff also alleged that it had suffered “massive business income losses” that continued to grow.
Ruling
The court concluded that the value of the litigation to the plaintiff plainly exceeded $75,000 and that Travelers had plausibly alleged the amount in controversy required for removal. Judge Jesse M. Furman therefore denied the plaintiff’s motion to remand as meritless. The court directed the plaintiff to file any amended complaint by December 2, 2020, or, if it filed no amended complaint, to file its opposition to Travelers’ pending motion to dismiss by that date. Travelers’ reply, if any, was due December 9, 2020. The Clerk was directed to terminate the motion to remand.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.