A panel of federal judges zeroed in on a potential location in assessing whether to consolidate travelers’ lawsuits against an Assicurazioni Generali S.p.A. unit for insurance coverage of pandemic-disrupted trips.
“I don’t think there’s much disagreement that the cases should be centralized,” said Judge Nathaniel M. Gorton, one of seven members of the Judicial Panel on Multidistrict Litigation that heard oral argument Thursday in the Generali consolidation case.
Gorton, a judge at the U.S. District Court for the District of Massachusetts, asked why a dozen cases against Generali shouldn’t be funneled to New York, where the insurer is headquartered.
“Why isn’t New York the center of gravity here?” he asked. “That’s where, it seems, relevant discovery will likely be.”
The hearing is the latest in a series of JPML reviews on whether to group hundreds of insurance lawsuits related to the Covid-19 pandemic. Many plaintiffs, often small business owners, argue insurance payouts are their lifeline to recouping lost income and staying in business.
The JPML declined to consolidate hundreds of business interruption cases earlier this year. But the panel is open to consolidating cases based on the defendant insurer, and created in October two, single-insurer groupings for lawsuits involving ski pass insurance providers.
Plaintiff lawyer Derek Potts, of the Potts Law Firm LLP, told the panel that logistical issues in New York caused by the coronavirus and the state’s response efforts could create major problems.
“It has one of the most restrictive Covid travel policies in the country,” said Potts, whose client Tralisa Sheridan wants the Generali actions sent to the U.S. District Court for the Eastern District of Texas.
“Right now, if I have to go to New York, I have to quarantine for two weeks,” he said. “You don’t have to do that in Texas.”
Generali sold insurance policies to travelers looking to protect against cancellations. Those policies outlined that certain causes of cancellations aren’t covered.
Generali policyholders who were denied claims sued the company, arguing that Covid-19 and state-issued restrictions amounted to cancellations caused by quarantines and natural disasters that are covered.
The JPML looks for common legal questions among cases, as well as potential efficiencies, in weighing whether to create multidistrict litigation. In previous cases, it also considered how geographically spread out the actions were.
Plaintiffs supporting centralization argue that that there are only a few cases against Generali, and that they involve the same legal issues.
“The main legal questions here are going to be what’s the meaning of quarantine, and what’s the meaning of a natural disaster under the policies,” said Kelly Iverson of Carlson Lynch LLP, who is representing two plaintiffs. “There were common denials by Generali, and the discovery of Generali is all going to be common across the claims.”
One judge can handle a dozen cases without much difficulty, plaintiffs argued.
“We have a limited number of cases— we have a limited number of states,” said Joseph Guglielmo of Scott & Scott Attorneys at Law LLP Guglielmo.
Some plaintiffs oppose consolidating cases, hoping to fight their legal battles alone.
Michael Kozlowski, Jr. told the panel that his clients’ lawsuit against Generali is different, and a “straightforward coverage case.” The other cases lack commonalities, he added.
But Judge Matthew F. Kennelly, of the U.S. District Court for the Northern District of Illinois, pushed back.
“You don’t have to show that the factual issues predominate, you just have to show that there are common issues,” he said.
Generali said it’s concerned that consolidating may delay proceedings.
In court filings, the insurer called the push for consolidation merely “gamesmanship.” Moving cases would upend the progress that already has been made, it argued.
Plaintiffs’ contention that the Generali travel insurance policies are identical is a “pretty drastic overstatement,” said Archis Parasharami of Mayer Brown LLP, who argued for Generali.
The factual questions are going to be “plaintiff specific,” Parasharami said.
There are motions to dismiss in nine of the 12 actions, and centralizing them before the rulings on the motions would also be premature, he said.
“I’m not seeing the sense in that,” Kennelly said. “It seems to be the opposite of what an MDL is all about — let’s wait for a bunch of inconsistent rulings and then consolidate the cases.”
The case is In Re: Generali Covid-19 Travel Ins. Litig., J.P.M.L., No. 2968, oral arguments held 12/3/20.
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