The Travelers Indemnity Company v. Northrop Grumman Corporation
- Lorna Schofield
- 1:16-cv-08778
- U.S. District Court · Southern District of New York
- 4
In Travelers v. Northrop Grumman, Judge Schofield denied Grumman’s motion to reconsider a stay pending the underlying Romano lawsuit’s final judgment and appeals.
Grumman remains subject to the stay of this insurance action while the Romano lawsuit proceeds to final judgment and the time for appeals expires; Travelers, Century, and Grumman’s remaining insurance issues were not resolved by this order.
What happened
The Travelers Indemnity Company v. Northrop Grumman Corporation concerns insurance coverage for the Romano lawsuit. An earlier decision resolved the parties’ summary-judgment motions about whether the insurers had to defend Grumman, granting Travelers’ motion and denying Century’s and Grumman’s motions. The court later stayed the remaining issues until the Romano lawsuit reached final judgment and the time for appeals expired.
Grumman asked the court to reconsider the stay and instead hold a hearing about which events counted as the relevant insurance occurrences. Grumman argued that New York insurance law required the court to identify those occurrences from the Romano complaint, and that earlier orders had rejected similar requests to stay the case. Grumman agreed that indemnity issues should remain stayed.
Judge Lorna G. Schofield denied reconsideration. She held that Grumman had not shown a change in controlling law, new evidence, clear error, or manifest injustice, and that its arguments largely repeated matters already considered. The court also said the earlier orders did not control the later decision to stay the case after discovery and extensive motion practice.
The detailed version
- The Travelers Indemnity Company v. Northrop Grumman Corporation · No. 1:16-cv-08778
- Lorna Schofield
- Dec. 5, 2022
Background
The case concerns insurance obligations connected to the Romano lawsuit. In an earlier opinion and order dated September 23, 2022, the court resolved cross-motions for summary judgment concerning whether the insurers had a duty to defend Grumman in that lawsuit. The court granted Travelers’ motion and denied Century’s and Grumman’s motions.
The parties then proposed next steps. They agreed that issues remained concerning Century’s defense and indemnity obligations, if any, and Travelers’ indemnity obligations, if any. They also agreed that the next issue should be whether Grumman gave Century timely notice of the occurrence under Century’s primary insurance policies. In an order dated October 12, 2022, the court stayed the action until a final judgment was entered in the Romano lawsuit and the time for appeals in that action had expired.
Motion for Reconsideration
Grumman moved for reconsideration of the stay. A motion for reconsideration asks the court to revisit an earlier ruling, but the court explained that such a motion generally requires an intervening change in controlling law, newly available evidence, clear error, or a need to prevent manifest injustice. It is not a vehicle for presenting old issues again or seeking a second hearing on the merits.
Grumman argued that the stay conflicted with New York insurance law. According to Grumman, the relevant occurrences and accidents should be identified from the allegations in the Romano complaint rather than from exposure facts established through evidence in that lawsuit. Grumman also argued that the stay could not be reconciled with two earlier orders that had refused to stay the case. In place of a stay, Grumman proposed an evidentiary hearing at which it would present testimony from its expert and insurer witnesses. Grumman agreed that indemnity issues should remain stayed.
Court’s Analysis
The court found that Grumman had not identified a change in controlling law, new evidence, clear error, or manifest injustice. It concluded that Grumman was essentially restating its earlier position, supplemented by its argument about the two prior orders. The court said those issues and facts had already been before it when it entered the stay.
The court also rejected the proposed evidentiary hearing as an attempt to revisit earlier decisions. A 2019 opinion had determined that a more developed evidentiary record was needed to decide whether each Romano plaintiff’s exposure to contamination was a separate occurrence or whether groups of plaintiffs had been exposed at nearly the same time and place, potentially requiring aggregation. The court stated that discovery had since concluded and the evidentiary record was closed, making Grumman’s proposed post-summary-judgment hearing an improper attempt to reconsider the issue.
The court further rejected Grumman’s arguments based on the law-of-the-case doctrine, which generally concerns whether a court should adhere to an earlier ruling in the same case, and judicial estoppel, which can prevent a party from taking inconsistent positions. The court explained that the two earlier orders were issued in 2017 and 2018, before substantial discovery ended and before the court’s summary-judgment opinions. Deciding whether to stay the case at the later stage presented a different question.
Disposition
Judge Lorna G. Schofield ordered that Grumman’s motion for reconsideration was DENIED. The Clerk of Court was directed to close the motion at Docket No. 470. The order did not alter the existing stay.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.