—[*1] The Zuppa Firm PLLC, Garden City, N.Y. (Raymond J. Zuppa of counsel), for appellant.

Rivkin Radler LLP, Uniondale, N.Y. (Evan H. Krinick, Cheryl F. Korman, Michael P. Versichelli, and Stuart M. Bodoff of counsel), for respondent State Farm Mutual Automobile Insurance Company.

Schenk, Price, Smith & King, LLP, New York, N.Y. (John P. Campbell of counsel), for respondents 684 Associates, Ltd., doing business as D&D Associates, Hooper Evaluations, Inc., Hooper Holmes, Inc., DDA Management Services, LLC, Brian Darmody, Anthony Minichini, and George Vadyak.

Lewis Johs Avallone Aviles, LLP, Islandia, N.Y. (Ann K. Kandel of counsel), and Leonard J. Tartamella, Hauppauge, N.Y., for respondents Medical Management Group of New York, Inc., and William Polikoff (one brief filed).

Aaronson Rappaport Feinstein & Deutsch, LLP, New York, N.Y. (Elliott J. Zucker of counsel), for respondent Marlon Seliger.

In an action, inter alia, to recover damages for breach of contract, the plaintiff appeals, as limited by his brief, from so much of an order of the Supreme Court, Suffolk County (Cohalan, J.), dated August 31, 2011, as granted the separate motions of the defendant State Farm Mutual Automobile Insurance Company, the defendants Hooper Evaluations, Inc., Hooper Holmes, Inc., 684 Associates, Ltd., doing business as D&D Associates, DDA Management Services, LLC, Brian Darmody, Anthony Minichini, and George Vadyak, the defendant Stephan Schector, the defendants Medical Management Group of New York, Inc., and William Polikoff, and the defendant Marlon Seliger to dismiss the complaint insofar as asserted against each of them pursuant to CPLR 3211 (a) (7).

Ordered that the order is modified, on the law, by deleting the provision thereof granting that branch of the motion of the defendant State Farm Mutual Automobile Insurance Company which was pursuant to CPLR 3211 (a) (7) to dismiss the first cause of action, which alleged breach of contract, and substituting therefor a provision denying that branch of the motion; as so [*2]modified, the order is affirmed insofar as appealed from, with one bill of costs payable by the plaintiff to the defendants Hooper Evaluations, Inc., Hooper Holmes, Inc., 684 Associates, Ltd., doing business as D&D Associates, DDA Management Services, LLC, Brian Darmody, Anthony Minichini, and George Vadyak, the defendants Medical Management Group of New York, Inc., and William Polikoff, and the defendant Marlon Seliger, appearing separately and filing separate briefs.

A cause of action premised upon fraud cannot lie where it is based on the same allegations as a cause of action alleging breach of contract (see Yenrab, Inc. v 794 Linden Realty, LLC, 68 AD3d 755 [2009]; Heffez v L & G Gen. Constr., Inc., 56 AD3d 526 [2008]). Where “a claim to recover damages for fraud is premised upon an alleged breach of contractual duties and the supporting allegations do not concern representations which are collateral or extraneous to the terms of the parties’ agreement, a cause of action sounding in fraud does not lie” (Yenrab, Inc. v 794 Linden Realty, LLC, 68 AD3d at 757 [internal quotation marks omitted]; see McKernin v Fanny Farmer Candy Shops, 176 AD2d 233, 234 [1991]). Here, the fraud cause of action against the defendant State Farm Mutual Automobile Insurance Company (hereinafter State Farm) is based on the same allegations as the breach of contract cause of action. Accordingly, the Supreme Court properly granted that branch of State Farm’s motion which was pursuant to CPLR 3211 (a) (7) to dismiss the third cause of action, sounding in fraud, insofar as asserted against it.

Further, the Supreme Court properly granted those branches of the separate motions of the remaining defendants which sought to dismiss the fraud cause of action insofar as asserted against each of them. A cause of action to recover damages for fraud requires allegations of (1) a false representation of fact, (2) knowledge of the falsity, (3) intent to induce reliance, (4) justifiable reliance, and (5) damages (see Eurycleia Partners, LP v Seward & Kissel, LLP, 12 NY3d 553, 559 [2009]; Pace v Raisman & Assoc., Esqs., LLP, 95 AD3d 1185 [2012]). Moreover, CPLR 3016 (b) requires that the circumstances underlying a cause of action based on fraud be stated “in detail” (see Scott v Fields, 92 AD3d 666, 668 [2012]). Here, the allegations of fraud against the remaining defendants either were bare and conclusory or do not rise to the level of fraud. Consequently, the Supreme Court properly granted those branches of the separate motions of the remaining defendants which were pursuant to CPLR 3211 (a) (7) to dismiss the third cause of action insofar as asserted against each of them.

However, the Supreme Court erred in granting that branch of State Farm’s motion which was to dismiss the first cause of action, which alleged breach of contract. The first cause of action contained sufficient factual allegations to state a cause of action to recover damages for breach of contract against State Farm. The complaint alleged, among other things, that the plaintiff entered into an insurance contract for State Farm to provide the plaintiff with no-fault insurance benefits if he was involved in a car accident, and that State Farm breached the contract by denying coverage for medical services. Since the allegations in the complaint were sufficient to state a breach of contract cause of action, the Supreme Court should have denied that branch of State Farm’s motion which was pursuant to CPLR 3211 (a) (7) to dismiss the first cause of action.

The Supreme Court properly granted that branch of State Farm’s motion which was pursuant to CPLR 3211 (a) (7) to dismiss the second cause of action, which sought consequential damages for breach of the no-fault insurance benefits policy. The plaintiff’s prolix allegations, when “[s]tripped of their verbiage” (United States Fid. & Guar. Co. v Pressler, 77 NY2d 921, 923 [1991]), do not adequately plead facts that would support a finding that his damages for pain and suffering arose out of State Farm’s alleged breach of its obligations under its no-fault insurance contract with him (see id. at 923).

The plaintiff’s remaining contention is without merit. Balkin, J.P., Chambers, Roman and Hinds-Radix, JJ., concur.

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Dawn Jimenez Salta, J.), entered August 4, 2011, deemed from a judgment of the same court entered September 6, 2011 (see CPLR 5501 [c]). The judgment, entered pursuant to the August 4, 2011 order granting plaintiff’s motion for summary judgment and denying defendant’s cross motion for summary judgment dismissing the complaint, awarded plaintiff the principal sum of $1,564.50.

ORDERED that the judgment is reversed, with $30 costs, the order entered August 4, 2011 is vacated, plaintiff’s motion for summary judgment is denied and defendant’s cross motion for summary judgment dismissing the complaint is granted.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment, and defendant cross-moved for summary judgment dismissing the complaint on the ground that the action was premature since plaintiff had failed to provide all of the requested verification. Defendant appeals from an order of the Civil Court entered August 4, 2011 which granted plaintiff’s motion for summary judgment and denied defendant’s cross [*2]motion for summary judgment dismissing the complaint. A judgment was subsequently entered in favor of plaintiff, from which the appeal is deemed to have been taken (see CPLR 5501 [c]).

In support of its cross motion for summary judgment, defendant submitted an affidavit by its claims examiner which established that defendant had timely mailed (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]) its request and follow-up request for verification, which sought, among other things, prescribed NF-3 claim forms. With respect to the prescribed claim forms, the Insurance Department Regulations provide that “[a]n insurer must accept proof of claim submitted on a form other than a prescribed form if it contains substantially the same information as the prescribed form” (see Insurance Department Regulations [11 NYCRR] § 65-3.5 [f]). The regulation further permits an insurer to require submission of the prescribed form (id.). Contrary to the determination of the Civil Court, the information contained in the claim forms which plaintiff submitted to defendant was not “substantially the same information” (Insurance Department Regulations [11 NYCRR] § 65-3.5 [f]) as required to be set forth on a prescribed NF-3 form (Sound Shore Med. Ctr. v New York Cent. Mut. Fire Ins. Co., ___ AD3d___, 2013 NY Slip Op 02390 [2d Dept 2013]).

Since plaintiff did not demonstrate that it had provided defendant with all of the requested verification prior to the commencement of this action, the 30-day period within which defendant was required to pay or deny the claims did not begin to run (see Insurance Department Regulations [11 NYCRR] § 65-3.8 [a]; Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492 [2005]).

Accordingly, the judgment is reversed, the order entered August 4, 2011 is vacated, plaintiff’s motion for summary judgment is denied and defendant’s cross motion for summary judgment dismissing the complaint is granted. In light of our determination, we do not reach defendant’s remaining contentions.

Weston, J.P., Pesce and Rios, JJ., concur.
Decision Date: May 14, 2013

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Appeal from a judgment of the Civil Court of the City of New York, Kings County (Helen C. Sturm, J.H.O.), entered July 26, 2011. The judgment, after a nonjury trial, dismissed the complaint.

ORDERED that the judgment is affirmed, with $25 costs.

In this action by a provider to recover assigned first-party no-fault benefits, a nonjury trial was held, limited to defendant’s defense of lack of medical necessity. Following the trial, the Civil Court found that defendant’s doctor’s testimony had demonstrated that the supplies in question were not medically necessary. Consequently, a judgment was entered in favor of defendant dismissing the complaint.

On appeal, plaintiff does not challenge the substance of defendant’s expert witness’s testimony. Instead, plaintiff objects to the admission into evidence of a peer review report and the underlying medical records. At a trial on the issue of medical necessity, a peer review report is not admissible to prove the lack of medical necessity. Rather, that issue is to be resolved based upon the testimony given by the medical experts (see A-Quality Med. Supply v GEICO Gen. Ins. Co., ____ Misc 3d ____, 2013 NY Slip Op 23088 [App Term, 2d, 11th & 13th Jud Dists 2013]). In this case, defendant properly established the lack of medical necessity at trial through the testimony of its expert witness. Thus, plaintiff’s contention that reversal is warranted because the court admitted the peer review report into evidence lacks merit. [*2]

The remainder of plaintiff’s objections similarly lack merit (see Park Slope Med. & Surg. Supply, Inc. v Travelers, 37 Misc 3d 19, 22-23 [App Term, 2d, 11th & 13th Jud Dists 2012]; Alrof, Inc. v Progressive Ins. Co., 34 Misc 3d 29 [App Term, 2d, 11th & 13th Jud Dists 2011]; Urban Radiology, P.C. v Tri-State Consumer Ins. Co., 27 Misc 3d 140[A], 2010 NY Slip Op 50987[U] [App Term, 2d, 11th & 13th Jud Dists 2010]).

Accordingly, the judgment is affirmed.

Weston, J.P., Pesce and Rios, JJ., concur.
Decision Date: May 14, 2013

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Rudolph E. Greco, Jr., J.), entered April 20, 2011. The order, insofar as appealed from, denied the branches of defendant’s motion seeking summary judgment dismissing so much of the complaint as sought to recover upon claims in the total sum of $3,988.58.

ORDERED that the order, insofar as appealed from, is affirmed, with $25 costs.

In this action by a provider to recover assigned first-party no-fault benefits, defendant denied plaintiff’s claims on the ground of “material misrepresentation” because plaintiff had billed for a heating pad which defendant had determined had not been provided to plaintiff’s assignor. Defendant moved for summary judgment dismissing the complaint, contending that, since one of plaintiff’s claim forms billed for an electric heating pad which had not been provided to plaintiff’s assignor, plaintiff was barred, as a result of this material misrepresentation, from receiving no-fault benefits for the electric heating pad as well as for the remaining supplies for which plaintiff sought to recover. Plaintiff opposed the motion. The Civil Court, by order entered April 20, 2011, granted defendant’s motion to the extent of dismissing so much of the [*2]complaint as sought to recover for the heating pad, on the ground that it had not been delivered to plaintiff’s assignor, but denied the branches of defendant’s motion seeking summary judgment dismissing so much of the complaint as sought to recover for the remaining supplies billed for, which amounted to $3,988.58. Defendant appeals from so much of the order as denied those branches of its motion.

Defendant failed to establish as a matter of law that the claim forms which are the subject of this appeal sought payment of assigned first-party no-fault benefits for medical supplies that had not actually been provided by plaintiff to its assignor. Defendant also failed to establish that the provider’s billing for a heating pad which had never been delivered to plaintiff’s assignor voided the automobile insurance policy underlying this action from the policy’s inception and that, therefore, defendant need not pay for any of the other medical supplies which may have been furnished to plaintiff’s assignor under this policy.

Accordingly, the order, insofar as appealed from, is affirmed.

Weston, J.P., Pesce and Rios, JJ., concur.
Decision Date: May 14, 2013

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Appeal from a judgment of the Civil Court of the City of New York, Kings County (Alice Fisher Rubin, J.), entered May 10, 2010. The judgment, after a nonjury trial, dismissed the complaint.

ORDERED that the judgment is reversed, with $30 costs, and the matter is remitted to the Civil Court for the entry of a judgment in favor of plaintiff in the principal sum of $2,063.10, plus statutory interest and attorney’s fees.

After plaintiff presented its prima facie case at the trial of this action by a provider to recover assigned first-party no-fault benefits, defendant offered no defense, but relied upon the record. The Civil Court dismissed the complaint, finding that plaintiff had not established a prima facie case because it had not offered into evidence an assignment of benefits.

While the claim forms at issue did not contain any language regarding an assignment of benefits, there is nothing in the record to indicate that defendant timely objected to the completeness of the forms or sought verification of the existence of a valid assignment. Accordingly, defendant waived any defense based thereon (see Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 320 [2007]; Hospital for Joint Diseases v Allstate Ins. [*2]Co., 21 AD3d 348 [2005]).

Contrary to defendant’s contention, at a trial, unlike upon a provider’s motion for summary judgment, a provider is not required to “show that there is no defense to the cause of action or that the cause of action or defense has no merit” (CPLR 3212 [b]). Rather, it is defendant’s burden to show that it has a meritorious defense (see generally Seaboard Sur. Co. v Gillette Co., 64 NY2d 304 [1984]; Northrup v Blue Cross & Blue Shield of Utica-Waterdown, 235 AD2d 1022 [1997]; 70 NY Jur 2d, Insurance § 1493) and that such a defense is not precluded (see Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 282 [1997]).

Accordingly, the judgment is reversed and the matter is remitted to the Civil Court for the entry of judgment in favor of plaintiff in the principal sum of $2,063.10, plus statutory interest and attorney’s fees due pursuant to Insurance Law § 5106 (a) and the regulations promulgated thereunder.

Weston, J.P., Pesce and Rios, JJ., concur.
Decision Date: May 14, 2013

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

Appeal from a judgment of the Civil Court of the City of New York, Kings County (Sylvia G. Ash, J.), entered March 26, 2010. The judgment, after a nonjury trial, awarded plaintiff the principal sum of $912.

ORDERED that the judgment is affirmed, with $25 costs.

In this action by a provider to recover assigned first-party no-fault benefits, a nonjury trial was held solely with respect to defendant’s defense of lack of medical necessity. Defendant’s expert witness identified her peer review report and conclusorily testified that the radiology services at issue were not medically necessary. Although the court allowed the peer review report into evidence for the limited purpose of showing that it was prepared by defendant’s expert witness, it did not consider the contents of the report. The court granted plaintiff’s motion for a directed verdict and awarded judgment to plaintiff, holding that defendant had not established a lack of medical necessity for the services at issue.

Since defendant’s expert’s testimony did not include a factual basis or medical rationale for her opinion, it was insufficient to establish that there was a lack of medical necessity for the services rendered (see A-Quality Med. Supply v GEICO Gen. Ins. Co., Misc 3d , 2013 NY Slip Op 23088 [App Term, 2d, 11th & 13th Jud Dists 2013]; PSW Chiropractic Care, P.C. [*2]v Maryland Cas. Co., 32 Misc 3d 144[A], 2011 NY Slip Op 51719[U] [App Term, 2d, 11th & 13th Jud Dists 2011]). Additionally, a peer review report, unlike a witness, is not subject to cross-examination and is not admissible by defendant to prove lack of medical necessity (see A-Quality Med. Supply, Misc 3d , 2013 NY Slip Op 23088). Thus, the Civil Court’s determination that defendant had not established that the services at issue were not medically necessary, could have been reached under a fair interpretation of the evidence (see Claridge Gardens v Menotti, 160 AD2d 544 [1990]).

As we find no basis to disturb the Civil Court’s findings, the judgment is affirmed.

Aliotta, J.P., Pesce and Rios, JJ., concur.
Decision Date: May 14, 2013

Civil Court of the City of New York, Kings County

068326/2011

ATTORNEYS FOR PLAINTIFF:

Ilona Finkelshteyn, Esq

2503 65th Street

Brooklyn, NY 11204

ATTORNEYS FOR DEFENDANT:

Law Offices of Spina, Korshin & Welden

170 Froehlich Farm Blvd.

Woodbury, NY 11797

Katherine A. Levine, J.

PapersNumbered

Notice of Motion and Affidavits Annexed………….. …………………………1

Notice of Cross-Motion and Affidavits Annexed.. ………………………….2

Answering Affidavits………………………………………………………………….. .

Replying Affidavits……………………………………………………………………..

Exhibits………………………………………………………………………………………..

Other: ………………………………………………………………………………………….

Upon the foregoing cited papers, the Decision/Order on this Motion is as follows:

This case was submitted solely on the unanswered question of whether the No-Fault Regulations require a defendant insurance company to respond to a letter from a plaintiff medical provider objecting to an EUO request as being unreasonable.

Plaintiff LK Health Products, Inc. (“plaintiff” or “LK”), a medical equipment company, [*2]commenced this action to recover the sum of $2,779.63 for medical supplies it provided to its assignor. Defendant GEICO General Insurance Company (“defendant” or “GEICO”) cross moves for summary judgment based upon plaintiff’s failure to show up at an EUO. Defendant sent plaintiff two EUO requests which explained that GEICO’s investigation into plaintiff’s business practices raised questions as to the accuracy of its billing and coding practices, its calculations, and whether the items billed for were the actual items provided to the patients.

In response to the defendant’s EUO request, plaintiff sent a letter which referenced the assignor’s name, the date of service and the amount outstanding. It read: “Please acknowledge this as a formal objection to the EUO request. It is my belief that you do not have a reasonable basis for an EUO request as regulation 68 requires. If there is any kind of information that you need, please request it in the form of verification request. In response to your attached letter, please find out filing receipt and verification of true ownership.” Plaintiff sent a filing receipt and verification of true ownership in response to defendant’s EUO letter.

In its motion plaintiff argues that defendant lacked a specific objective justification for the requested EUO and s that once plaintiff objected to the EUO, the burden shifted to the defendant to respond why its EUO request was reasonable. Plaintiff cites to 11 NYCRR §65 – 3.2, entitled “Claim Practice Principles to be Followed by All Insurers,” which provides that insurers are to: “(e) Clearly inform the applicant of the insurer’s position regarding any disputed matter and (f) Respond promptly, when a response is indicated, to all communications from insureds, …” in support of its position.

Defendant counters that its EUOs were properly scheduled based upon the results of its special investigation into the plaintiff’s business practices. Since its initial EUO scheduling letter explained the need for the EUO, defendant argues that it did not have to respond to plaintiff’s objection letter. It also argues that plaintiff’s boilerplate and nonspecific objection to an EUO did not obviate plaintiff’s obligation to appear.

The Court finds plaintiff’s argument unavailing. First, 11 NYCRR 65-3.2 is a generic provision which applies to all claim practices by insurers. In contrast, the Insurance Department has specifically addressed the obligations of insurers regarding No-Fault EUOs. The Department found that 11 NYCRR 65-3.5(e) does not require an insurer to justify its EUO requests or include language setting forth the reasons for requiring the EUO in either its notices for the EUO or its denials based upon an EUO no show. Nor need it even file with the Insurance Department the standards it maintains for determining when EUOs will be requested. (See Office of General Counsel, NYS Ins Dept. Opinion dated 12/22/2006).

The Court first notes that plaintiff has no standing to even raise this argument since it did not request that defendant provide its reasons for seeking an EUO but rather issued an objection letter indicating that it refused to appear. Furthermore, since no justification for an EUO request is necessary, this Court rules that an insurer is not obligated to reply to a plaintiff letter refusing to appear at an EUO and requesting that a defendant justify its reason for the EUO. Here, [*3]defendant went beyond its obligation by providing its reasons for the EUO in its initial scheduling letter. Finally, to rule otherwise would sanction the parties’ sending countless letters to each other, which would violate the intent of the No-Fault Law which encourages the prompt resolution of no fault claims. See New York and Presbyterian Hosp. v. Country-Wide Ins. Co., 17 NY3d 586, 589 (2011); All Boro Psychological Services, P.C. v. GEICO, 38 Misc 3d 268, 272 (Civ. Ct., Kings Co. 2012). The no-fault regulations were adopted by the Superintendent of Insurance in furtherance of these objectives. New York and Presbyterian Hosp., supra at 589 citing Hospital for Joint Diseases v. Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317, (2007).

It is well established that a plaintiff may preserve its right to challenge the reasonableness of the EUO request at the litigation stage if it objects to a requested EUO at the time it receives the notice. Eagle Surgical Supply, Inc v. AIG Ins Co., 2012 NY Slip Op 51711(U), 36 Misc 3d 153(A)(App. Term, 2nd Dept. 2012); All Boro Psychological Services, P.C. v. State Farm Mutual Automobile Ins. Co., 2012 NY Slip Op 51346(U), 36 Misc 3d 135(A)(App. Term, 2nd Dept. 2012). Here, the Court finds that the plaintiff timely objected to the defendant’s EUO request in writing. However, the defendant provided a clear and unambiguous affidavit from its Special Investigative Unit (“SIU”) Manager which substantiated the need for the EUO based upon an investigation it commenced of plaintiff for improper management and billing operations. Therefore, the defendant was justified in requesting the EUO of the plaintiff.

Plaintiff’s failure to show up for an EUO constituted a violation of a condition precedent to coverage, which voided the contract ab initio. Accordingly, the defendant insurer is not obligated to pay the claim, regardless of whether it issued denials beyond the 30 day period. Neomy Medical, P.C. v. American Transit Ins. Co., 2011 NY Slip Op 50536(U), 31 Misc 3d 1208(A)(Civ. Ct., Kings Co. 2011). See Lender Medical Supply, Inc v. Hartford Ins. Co., 2012 NY Slip Op 50903(U), 35 Misc 3d 1226(A)(Civ. Ct., Kings Co 2012). Since the contract has been vitiated, defendant may deny all the claims retroactively to the date of loss. Id.

In light of the above, the plaintiff’s motion is denied, the defendant’s motion is granted and the case is dismissed with prejudice.

The foregoing shall constitute the Decision and Order of the Court.

Dated: May 9, 2013___________________________

Katherine A. LevineJudge, Civil Court