Broadwall Management Corp. v. Affiliated FM Insurance Company
- Paul Engelmayer
- 1:21-cv-10247
- U.S. District Court · Southern District of New York
- 3
Broadwall Management v. Affiliated FM Insurance: Judge Engelmayer granted the parties’ request to pause discovery while the insurance company’s dismissal motion is pending.
The plaintiffs and Affiliated FM Insurance Company are affected because discovery was paused and the initial pretrial conference was adjourned while the motion to dismiss remains pending.
What happened
In Broadwall Management Corp. v. Affiliated FM Insurance Company, the plaintiffs alleged that their insurance policy covered business losses connected to the COVID-19 pandemic. The case concerns insurance coverage for losses involving fourteen commercial properties.
Both sides asked the court to pause discovery until the court decided Affiliated FM Insurance Company’s motion to dismiss. They agreed that discovery would be extensive and that the motion might eliminate or narrow the need for discovery, and no party opposed the request.
Judge Paul A. Engelmayer granted the request to stay discovery. He also adjourned the initial pretrial conference and directed the Clerk of Court to close the motion listed at docket number 33.
The detailed version
- Broadwall Management Corp. v. Affiliated FM Insurance Company · No. 1:21-cv-10247
- Paul Engelmayer
- Mar. 9, 2022
Background
The plaintiffs are described as commercial landlords operating fourteen spaces leased to various businesses. They alleged that Affiliated FM Insurance Company breached an insurance policy by failing to provide business-interruption coverage for losses allegedly stemming from the COVID-19 pandemic beginning in March 2020.
Affiliated FM had filed a motion to dismiss, which the parties expected to be fully briefed on April 19, 2022. The opinion states that the parties disagreed about the merits of that motion. Affiliated FM argued that recent Second Circuit decisions addressing whether COVID-19-related business losses trigger coverage for “direct physical loss” or “direct physical damage” supported a strong showing that the plaintiffs’ claim was unmeritorious. The plaintiffs were evaluating those decisions for their opposition but recognized that the court was likely to consider them.
Request to Stay Discovery
Under Federal Rule of Civil Procedure 26(c), a court may stay, or pause, discovery for good cause. The factors identified in the opinion include the strength of the defendant’s challenge, the breadth and burden of discovery, and the risk of unfair prejudice to the opposing party. Other considerations include the action’s nature and complexity, whether all defendants joined the request, the type and posture of the motion, and the stage of the litigation.
The parties anticipated voluminous document production, fact testimony, and expert opinions concerning both the plaintiffs’ claims and their alleged damages for each property. They agreed that the pending motion could eliminate or substantially limit the discovery needed. Because all parties consented to the stay, no party faced unfair prejudice from delaying discovery.
Ruling
The court granted the parties’ request to stay discovery pending a decision on the motion to dismiss. The court also adjourned the initial pretrial conference scheduled for March 17, 2022, stating that it would set a new conference date if necessary after resolving the motion to dismiss. The Clerk of Court was directed to close the motion pending at docket number 33.
Judge Paul A. Engelmayer’s order addressed the timing and scope of discovery; it did not decide the pending motion to dismiss or the underlying insurance-coverage dispute.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.