Schinitsky v. Pacific Indemnity Company

Background

Susan Schinitsky sued Pacific Indemnity Company for allegedly refusing to pay an insurance claim for personal property that went missing in July or August 2020. She alleged that the losses were covered by Pacific Indemnity’s Chubb Masterpiece Policy, that she timely reported the losses and provided proof including police reports, that she cooperated with the investigation, and that she performed her obligations under the policy. She alleged damages of at least $1,974,263.

Schinitsky asserted two claims: breach of the insurance contract and deceptive business practices under New York General Business Law § 349. Pacific Indemnity moved to dismiss the second amended complaint under Rule 12(b)(6), which tests whether a complaint alleges enough facts to state a legally plausible claim. At this stage, the court generally accepts well-supported factual allegations as true and does not decide disputed factual issues.

Documents Considered

The court considered the complaint and the certified copy of the insurance policy attached to Pacific Indemnity’s motion. It determined that the policy was integral to the complaint because the alleged contractual obligations depended on it. The court did not consider the other documents submitted with the parties’ motion papers, including correspondence and exhibits, because they were not attached to or sufficiently incorporated into the complaint.

Breach-of-Contract Claim

A breach-of-contract claim requires allegations of an agreement, the plaintiff’s performance, the defendant’s breach, and damages. The court concluded that Schinitsky adequately alleged all four elements. In particular, her allegations that she gave timely notice and proof of loss, cooperated with Pacific Indemnity’s investigation, and performed all required policy conditions were sufficient at the motion-to-dismiss stage.

Pacific Indemnity argued that Schinitsky had not complied with the policy’s proof-of-loss requirement. The court held that this argument depended on factual matters beyond the pleadings and concerned a defense that the complaint did not need to anticipate. The court therefore allowed the breach-of-contract claim to proceed. It stated that it would entertain a targeted summary-judgment motion and discovery based on the proof-of-loss defense.

New York General Business Law § 349 Claim

To state a claim under § 349, Schinitsky had to allege consumer-oriented conduct that was materially misleading and that caused her injury. The court found that she adequately alleged the first and third requirements, but not the second.

Schinitsky alleged generally that Pacific Indemnity placed economic pressure on policyholders, tried to make them accept less than the full amount due, and required claimants to hire their own adjusters to pursue replacement costs. The court found that the only specific factual allegation was that Pacific Indemnity required claimants to retain their own adjusters. Without more information about that requirement or other specific conduct showing how Pacific Indemnity misled her, the court found the allegations insufficient. It therefore dismissed the § 349 claim.

Disposition

Judge J. Paul Oetken’s order granted in part and denied in part Pacific Indemnity’s motion to dismiss. The breach-of-contract claim remains, while the § 349 claim was dismissed. Pacific Indemnity was ordered to file an answer to the remaining claim within 21 days after the opinion and order.