Ram Krishana Inc v. Mt Hawley Insurance Co

Background

Ram Krishana, Inc., doing business as Motel 6 Sulphur, is a Louisiana business entity with its principal place of business in Louisiana. Mt. Hawley Insurance Company is an Illinois corporation with its principal place of business in Illinois and an underwriting and claims office in New York. Mt. Hawley issued Ram Krishana an insurance policy covering two commercial properties in Sulphur, Louisiana, for the period from June 27, 2020, to June 27, 2021.

After Hurricane Laura damaged the properties, Ram Krishana submitted an insurance claim. Hurricane Delta later caused additional damage, and Ram Krishana submitted a second claim. Mt. Hawley had paid $315,040.56 toward the claims, but the parties disputed whether that amount covered all damage covered by the policy.

Ram Krishana sued Mt. Hawley for breach of contract and alleged violations of Louisiana insurance statutes concerning the timely, fair, and prompt handling and payment of claims. The case was originally filed in the U.S. District Court for the Western District of Louisiana. It was transferred to the Southern District of New York after the Fifth Circuit granted Mt. Hawley’s request to enforce the policy’s forum-selection clause.

The policy stated that all matters arising under it, including matters involving the policy’s validity, interpretation, performance, and enforcement, would be governed by New York law. The parties later filed cross-motions for partial summary judgment on which state’s law governed their claims. Ram Krishana also sought permission to file certain documents under seal, including the policy’s premium amount.

Choice of Law

The court first determined which state’s choice-of-law rules applied. Because the case had been transferred to enforce a forum-selection clause, the court applied New York choice-of-law rules rather than Louisiana choice-of-law rules. The court relied on the rule that a transfer based on a valid forum-selection clause does not carry the original court’s choice-of-law rules to the transferee court.

The court found an actual conflict because New York and Louisiana law differed in material respects. Under New York law, however, a contractual provision selecting New York law generally shows that the parties intended New York substantive law to apply without a further conflicts analysis. The court therefore enforced the policy’s New York choice-of-law provision.

Ram Krishana argued that Louisiana Revised Statute § 22:868 made the provision invalid because the policy covered subjects located in Louisiana. The court rejected that argument, reasoning that New York choice-of-law rules applied and required enforcement of the policy’s New York-law provision. The court did not address Mt. Hawley’s separate argument that the Louisiana statute’s exception for certain surplus-lines carriers also applied, because it agreed with Mt. Hawley’s alternative argument based on New York decisional law.

Scope of the Provision

The court held that the policy’s New York-law provision covered all of Ram Krishana’s claims. Ram Krishana did not dispute that the provision covered its breach-of-contract claim if the provision was valid. The court also held that the provision covered the Louisiana bad-faith claim because that claim concerned Mt. Hawley’s alleged duties to adjust, settle, and pay claims under the policy. The court likewise held that the provision covered Ram Krishana’s request for attorney fees because that request arose from the alleged breach of the policy.

The court concluded that New York substantive law applied to the contract claim, bad-faith claim, and attorney-fee request.

Sealing Request

The court denied Ram Krishana’s request to file certain documents under seal or with the policy premium redacted. Documents submitted with a summary-judgment motion carry a strong presumption of public access. The court found that Ram Krishana had not shown sufficiently compelling reasons to overcome that presumption. It also noted that the premium amount was central to Ram Krishana’s argument and that Mt. Hawley had publicly filed a document disclosing the premium without redaction.

Disposition

The court granted Defendant’s motion for partial summary judgment, denied Plaintiff’s motion for partial summary judgment, and denied Plaintiff’s motion to file certain documents under seal. The court ordered the parties to submit a joint letter within seven days proposing next steps, including whether additional summary-judgment briefing was appropriate or whether the case should proceed to trial. The court also directed that specified filings be unsealed.