Sometimes the Best Court Decision is to Do Nothing
Post 5209
Read the full article at https://www.linkedin.com/pulse/abstention-protects-against-risk-potentially-fact-zalma-esq-cfe-chkzc, and at https://zalma.com/blog plus more than 5200 posts.
In Starr Indemnity & Liability Company v. Scottsdale Insurance Company, No. 24-CV-3309 (PKC) (TAM), United States District Court, E.D. New York (September 30, 2025) the parties C.C.C. and HCC filed actions against Scottsdale in New York state court regarding Scottsdale’s insurance coverage obligations.
FACTS
Underlying Labor Litigation:
Hector David Campoverde sustained injuries from a scaffold fall at a construction site in Brooklyn, New York, on September 14, 2015. Campoverde, an employee of Vazquez Bro Restoration Inc., was working for C.C.C. Renovation Inc., a subcontractor of L&M Builders Group LLC.
LEGAL ISSUES
Declaratory Judgment:
Starr sought a declaratory judgment regarding Scottsdale’s obligations under the 2014-2015 and 2015-2016 policies.
Abstention Doctrine:
The court considered whether to abstain from exercising jurisdiction under the Declaratory Judgment Act (DJA) due to the ongoing State Court Action.
Priority of Coverage:
Dispute over whether Scottsdale or Starr should provide primary coverage for the claims against L&M.
Unjust Enrichment:
Starr claims that Scottsdale has been unjustly enriched by denying coverage.
DISCUSSION
Abstention is Appropriate in this Matter
The parties do not dispute that the Court has jurisdiction under the DJA; rather, they dispute whether the Court should exercise its jurisdiction.
Scottsdale moved to dismiss this action on the ground that abstention is appropriate. The primary basis for Scottsdale’s argument is that the underlying issue to be resolved-whether Scottsdale had an excess liability insurance policy in effect at the time of the accident-is currently being litigated in the pending State Court Action. Starr opposed the motion, asserting, inter alia, that there are several differences between this case and the State Court Action.
Scottsdale argued that this litigation is wholly duplicative of the litigation already pending in state court. The Court agreed. In the State Court Action, though C.C.C. discontinued its claims, Scottsdale, its agents, and HCC- the primary insurer for Starr’s insured, L&M-continue to litigate the very issue at the core of Starr’s requested relief in this action: whether Scottsdale had an excess insurance coverage policy in effect at the time of the accident.
Because the underlying question of Scottsdale’s coverage obligations is still unresolved in the State Court Action, the “risk of potentially contradictory fact finding between the state and federal court on this critical issue means that entertaining jurisdiction in this action would not clarify or settle the legal issues involved.
CONCLUSION
The Court concluded that exercising jurisdiction at this time would only further confuse them as this Court and the state court may come to differing conclusions as to whether Scottsdale had an insurance policy in effect on the date of the accident. Defendant’s motion to dismiss was denied, but its request for a stay, in the alternative, was granted and the matter was stayed pending resolution of the State Court Action.
ZALMA OPINION
I recently had a fight with a neighborhood sidewalk and fractured my nose and the base of my right eye. I went to an ENT specialist who gave me the same advice that the court gave the parties: To heal the best choice is to do nothing. The doctor, I and the USDC agreed. The best option for the case is to do nothing until the state court decision is final. Nothing can be gained from two courts with contradictory factual and legal findings.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
Please tell your friends and colleagues about this blog and the videos and let them subscribe to the blog and the videos.
Subscribe to my substack at https://barryzalma.substack.com/subscribe
Go to X @bzalma; Go to Barry Zalma videos at Rumble.com at https://rumble.com/account/content?type=all; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the InsuranceClaims Library – https://lnkd.in/gwEYk.
See the full video at and at and at https://zalma.com/blog plus more than 5200 posts.
Private Limitation In Accordance With Statute Defeats a Claim
Post 5204
There is No Good Reason to Delay Filing Suit
In Christian Care Center v. American Alternative Insurance Corporation, Civil Action No. 4:25-CV-00321-O, United States District Court, N.D. Texas, Fort Worth Division (October 6, 2025) a private limitation of action provision effective barred the suit.
KEY FACTS:
Plaintiff and Defendant:
The case involves an insured, the Christian Care Center (Plaintiff) and its insurer American Alternative Insurance (Defendant) in a coverage dispute.
Loss Event:
Plaintiff’s property sustained damage due to a storm on April 27, 2020.
Insurance Claim:
Plaintiff submitted a claim to Defendant on February 2, 2022, which was denied on July 29, 2022.
Lawsuit:
Plaintiff sued alleging breach of contract and violations of Chapters 541 ...
See the full video at and at and at https://zalma.com/blog plus more than 5200 posts.
Private Limitation In Accordance With Statute Defeats a Claim
Post 5204
There is No Good Reason to Delay Filing Suit
In Christian Care Center v. American Alternative Insurance Corporation, Civil Action No. 4:25-CV-00321-O, United States District Court, N.D. Texas, Fort Worth Division (October 6, 2025) a private limitation of action provision effective barred the suit.
KEY FACTS:
Plaintiff and Defendant:
The case involves an insured, the Christian Care Center (Plaintiff) and its insurer American Alternative Insurance (Defendant) in a coverage dispute.
Loss Event:
Plaintiff’s property sustained damage due to a storm on April 27, 2020.
Insurance Claim:
Plaintiff submitted a claim to Defendant on February 2, 2022, which was denied on July 29, 2022.
Lawsuit:
Plaintiff sued alleging breach of contract and violations of Chapters 541 ...
Insured May Intervene to Assert Bad Faith Claim Not Assigned
Post 5203
See the full video at https://rumble.com/v7013x8-insured-cant-assign-bad-faith-claim.html and at https://youtu.be/e8OApzn6YZs, and at https://zalma.com/blog plus more than 5200 posts.
Judge Requires Conflict Between Different District Courts in Louisiana Requires Conflict to be Resolved on Appeal
In Allstate Construction, Inc. v. Ohio Security Insurance Company, Civil Action No. 23-01295-BAJ-SDJ, United States District Court, M.D. Louisiana (September 30, 2025) Vina Cleaners, the insured, assigned its claim against Ohio Security to Allstate Construction but did not assign its rights to sue for the tort of bad faith so it intervened in Allstate Construction’s suit.
Background and Procedural History:
In an insurance dispute following damage caused by Hurricane Ida to Vina Cleaners’ property. Vina Cleaners was insured under a commercial policy with the Defendant, Ohio Security Insurance Company. Vina Cleaners assigned its rights ...
Oregon Statute Does Not Reverse Preempt Federal Arbitration Act
Post 5208
Read the full article at https://www.linkedin.com/pulse/federal-arbitration-provision-applied-barry-zalma-esq-cfe-9kjmc and at https:/zalma.com/blog plus more than 5200.
Litigation Over Costs to Clean Superfund Site Forced to Arbitration
Federal Arbitration Provision Applied
Read the full article at https://www.linkedin.com/pulse/federal-arbitration-provision-applied-barry-zalma-esq-cfe-9kjmc and at https:/zalma.com/blog plus more than 5200.
Oregon Statute Does Not Reverse Preempt Federal Arbitration Act
Post 5208
Litigation Over Costs to Clean Superfund Site Forced to Arbitration
In Pacificorp et al v. St. Paul Surplus Lines Insurance Company, et al, No. 3:25-cv-00163-AB, United States District Court, D. Oregon (October 7, 2025) Plaintiff PacifiCorp sued its excess liability insurers, for failing to indemnify costs related to the Portland Harbor Superfund Site only to have the suit stayed and arbitration compelled. This case tried to change the...
ZIFL – Volume 28, Issue 20
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Read the full article at https://lnkd.in/gt5Kyumz, See the full 18 page issue of ZIFL at https://lnkd.in/gBUgEBmP, and at https://zalma.com/blog plus more than 5200 posts.
Zalma’s Insurance Fraud Letter (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 https://lnkd.in/gVT5G9s
The Contents of the October 15, 2025 Issue of ZIFL Includes:
Zalma’s Insurance Fraud Letter (ZIFL) continues its 28th 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/
The Contents of the October 15, 2025 Issue of ZIFL Includes:
Insurer’s Attempt to Obtain Summary Judgment Against Fraudsters Fails
To Prove Fraud Admissible Evidence is Required
Allegations That Health ...
Insured Must Reside in Dwelling to Obtain Homeowners Insurance Claim Benefits
Post 5206
Read the full article at https://www.linkedin.com/pulse/estoppel-does-apply-where-plaintiff-deceived-insurer-barry-ifgdc and at https://zalma.com/blog plus more than 5200 posts.
In Donald Jackson v. Spinnaker Insurance Company, Civil Action No. 22-1244, United States District Court, W.D. Pennsylvania (October 7, 2025) where Plaintiff, in his Proposed Jury Instructions and Jury Verdict Slip and his Trial Brief asserted for the first time an entitlement to equitable estoppel on grounds that Defendant’s “own rules and procedures . . . required [Defendant, through its property inspector] to confirm that the insured had moved in and begun to reside in the insured premises.”
Plaintiff asserted that Defendant’s exercise of its right to inspect the property and failure to confirm, and/or communicate its assessment of, his residency induced his justified reliance. He further asserts that were he aware that his use of the property was ...
