Interrelated Acts Constitute a Single Claim
Post 5165
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In Yonah Rothman v. Complete Packaging & Shipping Supplies, Inc. and Mitchell Mankosa, Complete Packaging & Shipping Supplies, Inc. v. Arch Insurance Company, No. 22-CV-2821-SJB-ST, United States District Court, E.D. New York (August 4, 2025) dealt with the issue of parties seeking a partial judgment to be resolved on appeal.
Complete Packaging & Shipping Supplies, Inc. (“Complete”) and Arch Insurance Company (“Arch”) litigated disputes about coverage in relation to the Rothman employment discrimination action.
THE KEY ISSUES
Background:
Yonah Rothman filed a lawsuit against Complete and Mitchell Mankosa, alleging employment discrimination, underpayment, and wrongful termination. Rothman claims he was retaliated against for participating in a separate lawsuit brought by another employee.
Insurance Coverage Dispute:
Complete sought defense and indemnification from Arch based on their insurance policy. The policy covers conduct between December 5, 2021, and December 5, 2022, and includes an “interrelated claims” provision.
Court’s Decision:
The court dismissed Complete’s third-party complaint seeking defense and indemnity from Arch. The dismissal was based on the finding that the Rothman Actions arose from the same interrelated acts, constituting a single claim made in 2020, which was outside the policy’s coverage period.
Rule 54(b) Motion:
Complete filed a motion for entry of a partial judgment under Rule 54(b) to appeal the dismissal order.
Judicial Concerns:
The court highlighted concerns about the immediate appeal of indemnity issues, which are related to liability and may require the appellate court to address factual issues still being litigated.
ANALYSIS
Complete filed a Third-Party Complaint against Arch, seeking defense and indemnification in the Rothman Action based on an insurance policy between them (the “Policy”). The Policy provides coverage to Complete for conduct between December 5, 2021, to December 5, 2022.
The Policy also contains an “interrelated claims” provision that provides that all claims arising from the same facts are considered a single claim and deemed to have been brought on the date of the earlier claim.
The USDC noted that the employment discrimination actions arose from the same interrelated acts-the alleged retaliation by Complete against Rothman for his assistance with another lawsuit against Complete. Judge Merchant held that the two Actions constituted a single claim made in 2020, outside of the Policy’s coverage. Judge Merchant, therefore, granted Arch’s motion to dismiss.
The USDC concluded that the long-standing policy against piecemeal appeals required that the court’s power to enter such a final judgment before the entire case is concluded. The USDC noted that permitting an aggrieved party to take an immediate appeal, must be exercised sparingly.
Complete offers no alleged hardship or injustice for the Court to consider. Complete seeks judgment on both parts of the Arch dismissal, i.e., a resolution of both defense and indemnity obligations under the contract. The district court certified as final judgments its orders holding the insurers liable to provide a defense and allocating defense costs amongst the insurers. Final judgment was not entered with respect to the insurers’ duty to indemnify, however.
Although indemnity and liability issues are in some sense separate and distinct, they are nevertheless related. Indeed, by its very nature indemnity is collateral to and dependent upon a finding of liability. But even as to defense obligations, there is no blanket requirement that such issues be certified for partial appeal. Rule 54(b) judgment (and appeal) imposes a more demanding standard than the parties’ own assessment that it would be efficient to allow these appeals.
To that end, a defense claim (even against a third-party insurer) must be extricable and separate from the other claims being litigated. Were the Court to certify the dismissal for appeal, the Second Circuit could be forced to make an insurance coverage decision that would be undermined or superseded by a subsequent ruling in the underlying litigation.
Piecemeal litigation is not only inefficient but raises the risk of inconsistent judgments in coverage litigation that is appealed while underlying merits are resolved.
The motion for entry of a partial judgment under Rule 54(b) was denied.
ZALMA OPINION
Insurance coverage disputes are seldom easy. In this case the court found a duty to defend one part of the litigation seeking defense from the insurer, Arch, but found that both cases were based on a single cause that occurred before the Arch policy became effective. Seeking an Appeal of the issue of duty to defend or the duty to indemnify before a decision was made on the one issue sought to piecemeal the appeals, stretching the litigation beyond efficiency, which was properly refused.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Formulaic Recitation Of The Elements Of Civil Conspiracy Are Insufficient
Post number 5320
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In Hassan Fayad v. Liberty Mutual Insurance Company, et al., No. 2:25-cv-10930, United States District Court, E.D. Michigan, Southern Division (March 24, 2026) Plaintiff Hassan Fayad, the owner of several businesses providing transportation, diagnostics, testing, and therapy services, regularly billed insurance companies for these services, was arrested and tried for fraud, convicted, had the conviction overruled and sued the insurers and prosecutors he found responsible.
FACTUAL BACKGROUND
By January 2020, Liberty Mutual, Progressive, Allstate, and Esurance suspected fraudulent activity and filed a complaint with the Michigan Department of Attorney General (MDAG). The insurers alleged that Fayad and others billed Michigan auto insurance policies for profit without actually providing medically ...
Federal Courts Have Limited Jurisdiction
When all Parties Refuse Removal There is No Jurisdiction
Post number 5319
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In Beth Mayhew and Matthew Mayhew v. Vladimir Sadovyh, et al., No. 2:26-CV-04029-WJE, United States District Court, W.D. Missouri (April 6, 2026) Mayhew was involved in a trailer-truck accident with Vladimir Sadovyh, who was employed by Nova First, LLC and Globex Transport, Inc. Both companies owned the tractor-trailer involved.
FACTUAL BACKGROUND
Chubb and Mohave Transportation Insurance Company jointly issued an insurance policy covering Nova First, Globex, and Sadovyh, with EMA Risk Services acting as a third-party administrator.
Beth Mayhew sued Nova First, Globex, and Sadovyh for negligence in Missouri state court, and following a jury trial, a nuclear judgment was awarded to the Mayhews totaling ...
Ordinary Negligence is What Medical Professi0nal Liability Insures
Post number 5319
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Sexual Conduct Exclusion Doesn’t Apply When Doctor Negligently Uses His Own Sperm
In Integris Insurance Company v. Narendra B. Tohan, No. AC 47222, Court of Appeals of Connecticut (April 7, 2026) Integris Insurance Company, a medical professional liability insurer, initiated a declaratory action to determine its duty to defend and indemnify Narendra B. Tohan, a physician licensed in Connecticut, in a separate negligence action alleging medical misconduct.
FACTUAL BACKGROUND
In 2019, Kayla Suprynowicz and Reilly Flaherty (civil action plaintiffs), who were strangers for most of their lives, discovered through a genetic testing company that they are half siblings.
INSURANCE POLICY
The policy defines “Professional Services” in relevant part as “any professional medical services within the ...
ZIFL – Volume 30, Issue 7 – April 1, 2026
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5314
Posted on April 1, 2026 by Barry Zalma
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ This issue contains the following articles about insurance fraud:
No One is Above the Law – Not Even a Police Officer
Police Officer Convicted for Fraud in Reporting an Accident Affirmed
Police Officer Should never Lie about Results of Chase
In State Of Ohio v. Anthony Holmes, No. 115123, 2026-Ohio-736, Court of Appeals of Ohio, Eighth District, Cuyahoga (March 5, 2026) a police officer appealed criminal conviction as a result of lies about a high speed chase.
Read the following article and the full issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-04-01-2026-1.pdf...
ZIFL – Volume 30, Issue 7 – April 1, 2026
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5314
Posted on April 1, 2026 by Barry Zalma
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ This issue contains the following articles about insurance fraud:
No One is Above the Law – Not Even a Police Officer
Police Officer Convicted for Fraud in Reporting an Accident Affirmed
Police Officer Should never Lie about Results of Chase
In State Of Ohio v. Anthony Holmes, No. 115123, 2026-Ohio-736, Court of Appeals of Ohio, Eighth District, Cuyahoga (March 5, 2026) a police officer appealed criminal conviction as a result of lies about a high speed chase.
Read the following article and the full issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-04-01-2026-1.pdf...
Posted on March 30, 2026 by Barry Zalma
Insurance Fraud, a Way to Reduce Violent Crime
Post number 5313
A Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story helps to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
She Taught Her Customers The Swoop And Squat:
Recently the California Insurance Department’s Fraud Division arrested a young woman in Los Angeles County for operating an insurance fraud school. She advertised her classes in the “Penny Saver” an advertising sheet distributed free to the public and a print version of Facebook, X Craig’s list. She had operated for several years teaching methods of committing automobile insurance fraud. Only after a police officer enrolled in one of her classes was she arrested.
Her defense ...