Civil Court of the City of New York, Kings County

32177/03

Eileen N. Nadelson, J.

On July 10, 2003, Plaintiffs submitted a Motion for Summary Judgment as providers of first party benefits under New York’s No-Fault Insurance Law. That motion was subsequently denied on November 18, 2003, because Plaintiffs failed to provide sufficient support for the requested judgment. Plaintiffs never moved to renew or reargue that decision.

On July 5, 2004, Plaintiffs submitted this instant Motion for Summary Judgment, requesting the same relief based on the same underlying claim. In the motion papers, Plaintiffs state that they are remaking the motion originally filed on July 10, 2003, based on new affidavits of the treating physicians.

The above-recited facts present to the court the issue as to whether a party may file a new [*2]Motion for Summary Judgment after an initial Motion for Summary Judgment for the same relief on the same claim was denied based on insufficient documentary support to grant that motion.

Generally, once a motion for summary judgment has been denied, subsequent motions seeking the same relief must be denied as res judicata. Smith v. Palmieri, 103 AD2d 739, 477 N.Y.S. 2d 206 (2d Dept. 1984). This may be true even if the original denial is based on a party’s failure to come forward with evidentiary facts, rather than on a full determination based on all relevant data. Johnson v. Unexcelled, Inc., 42 AD2d 529, 345 N.Y.S. 2d 1 (1st Dept. 1973). Consequently, the court must determine whether there is any legal basis for permitting Plaintiffs to remake a motion for summary judgment that has previously been denied for technical, rather than substantive, reasons.

Section 3212 of the CPLR establishes the rules for the proof necessary to support a motion for summary judgment. Secion 3212(b) states that

A motion for summary judgment shall be supported by affidavit, by a copy

of the pleadings and by other available proof, such as depositions and written

submissions.

Courts have held, and prudent practice demands, that if a movant, in preparation of a motion for summary judgment, cannot assemble sufficient proof to dispel all questions of material fact, the motion should simply not be submitted. Seefeldt v. Johnson, 13 AD3d 1203, 787 N.Y.S. 2d 594 (4th Dept. 2004). Further, courts may exercise their discretion in rejecting supporting papers that are untimely submitted. Moore v. Long Island College Hospital, 273 AD2d 365, 714 N.Y.S. 2d 683 (2d Dept. 2000).

However, if circumstances arise in which facts essential to justify or oppose a motion may exist but cannot be then stated, the court may order a continuance to permit affidavits to be obtained. CPLR sec. 3212(f). To grant such a continuance, it must be demonstrated by the party requesting such relief that further discovery may lead to the relevant evidence. Wyllie v. District Atty. of County of Kings, 2 AD3d 714, 770 N.Y.S. 2d 110 (2d Dept. 2003).

The courts also permit a party to move to renew or reargue a motion for summary judgment to correct the failure to include proof in evidentiary form in the original motion upon a showing of law office failure and absence of prejudice to the opposing side. Campbell v. Cloverleaf Transp., Inc., 5 AD3d 169, 773 N.Y.S. 2d 50 (1st Dept. 2004). To grant a motion to renew or reargue, the movant must proffer a sufficient excuse as to why a necessary affidavit was not included in the original papers. Brignol v. Warren Elevator Service Co., Inc., 240 AD2d 354, 657 N.Y.S. 2d 768 (2d Dept. 1997).

In the instant case, Plaintiffs never requested a continuance of their original motion, nor did they seek to renew or reargue the denial of that motion. Rather, Plaintiffs simply waited half a year and submitted a new motion that included the affidavits missing from the original papers. [*3]The affidavits now submitted are affidavits from the treating physicians who are the Plaintiffs in this action. No excuse is offered as to why the affidavits were not included with the first papers.

Courts have refused to permit a party to renew or reargue the denial of a motion for summary judgment based on more detailed affidavits than were originally submitted when such elaboration is not based on newly found information and no reasonable justification was given for not including the affidavits in the first instance. Stoklas v. Auto Solutions of Glenville, Inc., 9 AD3d 780, 780 N.Y.S. 2d 215 (3d Dept. 2004). When the inadvertence involved in not including necessary affidavits appears to be the lack of realization of the need for such affidavits rather than mere law office error, the courts refuse to permit a reargument of the denial of a summary judgment motion. Foitl v. G.A.F. Corporation, 64 NY2d 911, 488 N.Y.S. 2d 377 (1985).

It would fly in the face of judicial logic to permit a party to submit a new motion for summary judgment when that party would not be able to reargue the denial of an earlier motion seeking the same relief. Therefore, based on the foregoing, Plaintiffs’ Motion for Summary Judgment is denied as res judicata.

Dated: April 7, 2005

__________________________

EILEEN N. NADELSON, J.C.C.

Civil Court of the City of New York, Kings County

99251/03

Eileen N. Nadelson, J.

Plaintiff medical provider instituted this action for first party benefits pursuant to New York’s No-Fault Insurance Law. Defendant insurer denied Plaintiff’s claim for benefits, alleging that the treatments provided were not medically necessary. The matter was tried before a jury.

In preparing to instruct the jury, the court discovered that there is no Pattern Jury Instruction defining the term “medical necessity,” despite the fact that several decisions have been published attempting to define the term judicially, since it is not defined by the No-Fault statute itself.

In Elm Medical, P.C. aao Tamara Feit v. American Home Assurance Company, 2003 NY Slip Op. 51357U, 2003 NY Misc. Lexis 1337 (Kings County 2003), the court adopted the definition of “medical necessity” used by the New Jersey courts:

A necessary medical expense under the [No Fault] Act is one incurred for

a treatment, procedure, or service ordered by a qualified physician based on

the physician’s objectively reasonable belief that it will further the patient’s

diagnosis and treatment. The use of the treatment, procedure, or service

must be warranted by the circumstances and its medical value must be

verified by credible and reliable evidence.

This is the same definition that was originally used by an earlier court in Medical Experise, P.C.aao Irina Moukha v. Trumbull Insurance Company, 196 Misc 2d 389, 765 N.Y.S. 2d 171 (Queens County 2003).

More recently, based on pending legislation, a modification of the New Jersey definition was promulgated: [*2]

treatment or services which are appropriate, suitable, proper and conducive to

the end sought by the professional health services in consultation with the

patient. It means more than merely convenient or useful treatment or services,

but treatment or services that are reasonable in light of the patient’s injury,

subjective and objective evidence of the patient’s complaints of pain, and the

goals of evaluating and treating the patient.

Behavioral Diagnostics aao Maria Arevalo et al. v. Allstate Insurance Company, 3 Misc 3d 246, 776 N.Y.S. 2d 178 (Kings County 2004), citing Fifth Avenue Pain Control Center v. Allstate Ins. Co., 196 Misc 2d 801, 766 N.Y.S. 2d 748 (Queens County 2003).

Based on the published decisions of the courts, we believe that an appropriate jury instruction on the definition of “medical necessity” is:

For an expense to be considered medically necessary, the treatment, procedure, or

service ordered by a qualified physician must be based on an objectively reasonable

belief that it will assist in the patient’s diagnosis and treatment and cannot be reasonably dispensed with. Such treatment, procedure, or service must be

warranted by the circumstances as verified by a preponderance of credible and

reliable evidence, and must be reasonable in light of the subjective and objective evidence of the patient’s complaints.

Dated: April 7, 2005

__________________________

EILEEN N. NADELSON, J.C.C.

Civil Court of the City of New York, Kings County

108436/04

Ellen M. Spodek, J.

Upon the foregoing papers, petitioner T.S. Medical P.C. moves for an order, pursuant to Article 75 of the CPLR, vacating a No-Fault Master Arbitration Award.

After petitioner was denied no-fault benefits, it filed a request for arbitration. The arbitration award that was rendered on March 23, 2004 denied petitioner’s claim. Petitioner then requested a review of the arbitration award by a Master Arbitrator. The case was reviewed and the Master Arbitrator upheld the lower arbitration award. This decision was rendered on or around July 22, 2004. This petition is filed less than ninety (90) days since receipt of the Master Arbitrator Award.

The Second Department holds “[w]hen a party to a controversy is compelled by statute to submit to arbitration—and thereby loses the right of initial resort to a judicial forum—the right to review the resulting arbitration award cannot in turn be overly limited in scope, without involving a due process issue. Thus the Court of Appeals has interpreted CPLR article 75 as requiring broader review when compulsory arbitration is in issue than when the matter has a consensual origin.” (Shand v Aetna Ins. Co., 74AD2d 442, 446 (2d Dept 1980); citing Furstenberg v Aetna Casualty & Surety Co., 49 NY2d 757 [1980]; Mounty St. Mary’s Hosp. of Niagara Falls v Catherwood, 26 [*2]NY2d 493 [1970]; Caso v Cofey, 41 NY2d 153, 155 [1976]; 1 NY Jur 2d, Administrative Law §190). In the case at bar, petitioner chose to go to arbitration. Arbitration was only mandatory for the defendant thus a narrow review is required. Further, a master arbitrator’s award may be vacated if it is arbitrary and capricious, irrational or without a plausible basis. (Steinauer v. N.Y Central Mutual Fire Insurance Company, 707, N.Y.S.2d 706).

In it’s report, the arbitrator states that “Respondent’s denial for treatment in October 2001 is late and for those subsequent treatments the denial is improperly based on a nurse’s audit.” However, he concludes that the applicant had to prove medical necessity in it’s prima facie case. This position was upheld by the Master Arbitrator. It is well established that the burden is on the insurer to prove the lack of medical necessity and not on the insured to prove medical necessity in establishing their prima facie case. (Amaze Medical Supply Inc. v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U][App Term, 2d and 11th Jud Dists]; Damadian MRI In Elmhust, P.C. v Liberty Mutual Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51700[U], [App Term, 9th and 10th Jud Dists]; see also A.B. Medical Services PLLC v Lumbermens Mutual Casualty Co., 4 Misc 3d 86, 87 [App Term, 2d and 11th Jud. Dists].)

The courts have consistently held that it is proper to “vacate the determinations of a master arbitrator who denied a petitioner payment for overdue no-fault benefits because it did not have rational basis.” (In the Matter of Pradip Das/N.Y. Medical Rehab P.C. v Allstate Insurance Company, 297 AD2d 321 (2nd Dept. 2002)). Clearly, in order for the decision of the Master Arbitrator to be rational it would have to comport with the established principles of law. The insurance regulations clearly enumerate the methods of review available to the Master Arbitrator including the ability to overturn an award that was “incorrect as a matter of law. “NYCRR 65.17 (a)(4). In this action, the Master Arbitrator had the power to correctly apply the law, but chose not to.

Accordingly, this Court grants the petitioner’s motion and finds that the Master Arbitrator’s award should be vacated.

The foregoing constitutes the decision and order of this court.

E N T E R,

Dated: March 31, 2005__________________

Hon. Ellen M. Spodek

[*1]

Civil Court of the City of New York, Kings County, March 24, 2005

APPEARANCES OF COUNSEL

Alden Banniettis, Brooklyn, for plaintiff. Moore & Associates, New York City, for defendant.

OPINION OF THE COURT

Arlene P. Bluth, J.

Plaintiff Dilon Medical Supply Corp. brought this action to recover first-party no-fault benefits in the amount of $1,928 plus statutory interest, costs, and attorneys’ fees for medical supplies it allegedly furnished to plaintiff’s assignor, Cuthbert Grannum, on January 29, 2004, and February 16, 2004, following an alleged accident on November 5, 2003.

The trial was scheduled before me on March 10, 2005. Since the attorneys for both parties stipulated to the facts below, there was no testimony by witnesses.

For the following reasons, the court finds for defendant Travelers Insurance Company, and dismisses plaintiff’s complaint.

Stipulated Facts

Plaintiff Dilon Medical Supply Corp., as the proper assignee of Cuthbert Grannum, submitted two bills for no-fault benefits to defendant Travelers Insurance Company. The first bill was for $837 for six items furnished to plaintiff’s assignor on January 29, 2004 (plaintiff’s exhibit 1); the second was for $1,091 for four items furnished to plaintiff’s assignor on February 16, 2004 (plaintiff’s exhibit 2). Defendant’s timely request for verification (and timely follow-up thereto) asked that plaintiff “forward a letter of medical necessity for medical supplies” in order to process the claims (plaintiff’s exhibit 3). Plaintiff received the requests but ignored them. Plaintiff did not respond because it believes the requests to be improper since plaintiff is merely a medical supply company and not a clinician capable of speaking to the medical necessity of the [*2]items furnished. Having received no response to its verification requests, defendant neither paid nor denied the claims. Plaintiff then initiated this action. Both parties subsequently moved for summary judgment. On December 21, 2004, on grounds unrelated to the issue before this court, Judge Ellen Gesmer denied both plaintiff’s and defendant’s motions for summary judgment.

Conclusions of Law

The issue in this case is whether an insurer can direct a request for verification of the necessity of medical supplies to the claimant medical supplier which, it is undisputed, has no clinical expertise. The Insurance Law and the regulations promulgated thereunder provide that “[w]ithin 30 calendar days after proof of claim is received, the insurer shall either pay or deny the claim in whole or in part.” (11 NYCRR 65-3.8 [c]; see Insurance Law § 5106 [a].) An insurer may extend this 30-day period if, within 15 business days after receipt of the claim, the insurer sends a request for further verification of the claim. (11 NYCRR 65-3.5 [b].) If the demanded verification is not received within 30 days, the insurance company must issue a follow-up request within 10 calendar days of the insured’s failure to respond. (11 NYCRR 65-3.6 [b].) The 30-day period which the insurer has to either pay or deny the claim does not begin to run until all demanded verification is provided. (11 NYCRR 65-3.8 [a] [1]; see New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568 [2d Dept 2004].) With exceptions not relevant here, the insurer is precluded from issuing a denial while a verification request is outstanding. (11 NYCRR 65-3.8 [b] [3].)

Just as the insurer has a duty to speedily process claims, the claimant for benefits has a duty of cooperation in supplying information reasonably requested by the insurer to process the claim. The regulations provide that the Mandatory Personal Injury Protection Endorsement, or no-fault section, of all insurance policies contain, inter alia, the following condition: “Upon request by the [Insurance] Company, the eligible injured person or that person’s assignee or representative shall . . . provide authorization that will enable the Company to obtain medical records; and . . . provide any other pertinent information that may assist the Company in determining the amount due and payable.” (11 NYCRR 65-1.1 [d] [“Conditions”].) Upon receipt of the initial prescribed verification forms, the insurer may request “any additional verification required by the insurer to establish proof of claim.” (11 NYCRR 65-3.5 [b]; see also Westchester Med. Ctr. v Travelers Prop. & Cas. Ins. Co., 2001 NY Slip Op 50082[U], *2-3 [Sup Ct, Nassau County 2001] [“(T)he requirement that a claim be paid or denied within 30 days is conditioned upon receipt of information requested by the insurer. This information is not necessarily that which can be found on the . . . prescribed verification forms . . . but any information that the carrier finds necessary to properly review and process the claim”].)

Here, defendant timely requested a letter of medical necessity—understood by both plaintiff and defendant to mean a narrative from the injured party’s medical provider explaining why the furnished supplies were necessary—from plaintiff, the party that had submitted the claim.

The substance of defendant’s verification request was both valid and proper—not only did defendant have the right to verify the medical necessity of the supplies, it was required to do so if payment of the claims would turn on a determination of medical necessity. (See 11 NYCRR 65-3.5 [b].) Moreover, under the regulations, “[t]he insurer is entitled to receive all items necessary to verify the claim directly from the parties from whom such verification was requested.” (11 [*3]NYCRR 65-3.5 [c].)

Plaintiff argues, however, that defendant’s request was improper in that it was directed to plaintiff, a mere equipment supplier with no clinical expertise. Plaintiff claims that defendant obviously knew that plaintiff would in turn have to contact either its assignor or his medical provider to obtain the letter of medical necessity. According to plaintiff, defendant should have directed its request to the treating medical provider, or, if defendant did not know the provider’s name or address, requested that information from plaintiff, or asked plaintiff for the prescriptions it had received from its assignor. In support of its argument, plaintiff cites section 65-3.5 (a) of the regulations, which provides: “Within 10 business days after receipt of the completed application for motor vehicle no-fault benefits . . . , the insurer shall forward, to the parties required to complete them, those prescribed verification forms it will require prior to payment of the initial claim.” (11 NYCRR 65-3.5 [a] [emphasis added].)

A plain reading of that provision, however, makes clear that it governs initial requests for verification by which insurers may require parties to complete the requisite forms that comprise the initial claim for benefits—that is, in setting up the injured party’s file. That is not the case here. A request for a letter of medical necessity is a request for additional verification governed by subdivision (b) of this section, and subdivision (b) does not qualify to whom requests for additional verification must be sent. Any additional verification that could be sought from plaintiff’s assignor may be sought from plaintiff^[FN*] because “[a]n assignee stands in the shoes of the assignor.” (Arena Constr. Co. v Sackaris & Sons, 282 AD2d 489, 489 [2d Dept 2001].)

Accordingly, when a claimant submits bills to an insurer for payment, the claimant, who stands in the shoes of his assignor, must deal in good faith and cooperate with the insurer if it wants to get paid. This includes responding to a proper and timely verification request, even if the claimant anticipates that it will not be able to satisfy the insurer’s request. In other words, even if the claimant believes it cannot or need not comply with the insurer’s request, the claimant still has a duty to communicate with the insurer regarding the request.

In so holding, this court follows the reasoning of the Second Department. For example, where a plaintiff medical provider found an insurer’s demands “so lacking in specificity as to be ‘unintelligible’ and that such demands were, therefore, nullities,” the Second Department refused to excuse plaintiff’s nonresponsiveness to defendant’s requests. (Westchester County Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 262 AD2d 553, 555 [2d Dept 1999].) “[T]he notices clearly constituted demands for further verification of the claim within the no-fault regulatory scheme. Any confusion on the part of the plaintiff as to what was being sought should have been addressed by further communication, not inaction. Accordingly, as the plaintiff does not dispute that the demanded verification was never supplied, the 30-day period in which the defendant had to pay or deny the . . . claim never commenced and that claim is not overdue.” (Id.)

The Second Department has also dismissed no-fault actions where the plaintiff failed to respond because the insurer’s request was allegedly not on a proper form (Hospital for Joint Diseases v State Farm Mut. Auto. Ins. Co., 8 AD3d 533, 535 [2d Dept 2004]; St. Vincent’s Hosp. of Richmond v American Tr. Ins. Co., 299 AD2d 338 [2d Dept 2002]) or was sent to the plaintiff’s [*4]attorney rather than directly to plaintiff (St. Vincent’s Hosp. of Richmond, 299 AD2d at 340; New York Hosp. Med. Ctr. of Queens v State Farm Mut. Auto. Ins. Co., 293 AD2d 588 [2d Dept 2002]). The contours of plaintiff’s duty of cooperation are good faith and common sense. “[E]ven if [the insurer’s] request for the hospital records should have been sent directly to the hospital, its attorney, upon receiving the requests, should have contacted State Farm and communicated that requirement, or forwarded State Farm’s requests to the hospital himself.” (New York Hosp. Med. Ctr. of Queens, 293 AD2d at 591.)

When plaintiff received defendant’s verification requests, it had a duty to respond. Plaintiff might have submitted the prescriptions it had received from its assignor. It might have supplied the name and address of the treating physician. It might have contacted its assignor to obtain a letter of medical necessity from his physician, or contacted the physician directly. Because plaintiff simply ignored the requests altogether, however, it is unnecessary for the court to decide what the minimum adequate response would have been.

Because plaintiff failed to respond to defendant’s valid and proper verification requests, the 30-day period within which defendant had to either pay or deny the claim did not begin to run. (See Hospital for Joint Diseases v State Farm Mut. Auto. Ins. Co., 8 AD3d 533, 534-535 [2d Dept 2004]; St. Vincent’s Hosp. of Richmond v American Tr. Ins. Co., 299 AD2d 338, 340 [2d Dept 2002].) Therefore, plaintiff’s claims for no-fault benefits are not overdue, and this action is premature and must be dismissed. (See Hospital for Joint Diseases, 8 AD3d at 534-535; St. Vincent’s Hosp. of Richmond, 299 AD2d 338 [2002]; New York Hosp. Med. Ctr. of Queens, 293 AD2d at 591.) Accordingly, judgment is for defendant and plaintiff’s complaint is hereby dismissed.

Footnotes

Footnote *: Obviously, in the case of an IME or EUO of the injured party, only the injured party can actually provide the requested verification.

Civil Court, Kings County

046401/04

Loren Baily-Schiffman, J.

This action for first-party No-Fault benefits was tried to completion on February 8, 2005. Plaintiff seeks payment of claims for $708 for services to James Percine and $1600.50 for services provided to Antoine Wekson. Defendant denied plaintiff’s claims on the basis that “[w]e do not provide coverage for any ‘insured’ who has made fraudulent statements or engaged in fraudulent conduct in connection with any accident or loss for which coverage is sought under this policy.” At the start of trial, the parties stipulated that Plaintiff’s bills had been timely submitted and that Defendant’s denial would be admitted into evidence along with a number of exhibits. Plaintiff then made several motions in limine.

Plaintiff first sought the exclusion from evidence of transcripts of Examinations Under Oath (hereinafter “EUO”) of Plaintiff’s assignors. The Court granted this motion on the basis that the transcripts had not been signed by the assignors and that such documents would be hearsay.^[FN1] Plaintiff also sought a determination by the Court that subpoenas for testimony of the assignors are defective and, accordingly, no adverse inference can be drawn from the non-appearance of the assignors at trial. The Court granted this application on the basis that the subpoenas had not been properly served.

The trial then proceeded on defendant’s affirmative defense of fraud. Defendant called Philip Tirone as its only witness. Mr. Tirone is employed by defendant as an investigator in its Special Investigation Unit. He was assigned to investigate the subject claims. Mr. Tirone testified that the assignors allegedly sought treatment from plaintiff as a result of an accident [*2]between two cars. There were several passengers in the cars, including the assignors involved in this action. As part of his investigation, Mr. Tirone attempted to contact his insured, Ms. Paul, and assignor Wekson who gave the same home address as Ms. Paul. He was not able to reach either Ms. Paul or Mr. Wekson. He contacted assignor Percine, but testified that he got no helpful information from Mr. Percine. Mr. Tirone then recommended to defendant’s attorney that EUOs be scheduled of Ms. Paul, Mr. Wekson and the other passengers. After more than one attempt to obtain appearances at EUOs, Mr. Wekson, Mr. Percine and Ms. Jerome appeared for EUOs with their attorneys and their testimony was taken. Mr. Tirone testified that other than his unsuccessful attempts to obtain signatures of the witnesses to their EUO transcripts, no further efforts were made to investigate the subject claims.

The Court ruled that the EUO transcripts were not admissible but Mr. Tirone could testify to his recollection of the testimony of the witnesses at their examinations. The basis of the Court’s ruling was that the assignors and the Plaintiff/assignee were united in interest and, therefore, statements made by the assignors are binding on the assignee as admissions.

Mr. Tirone continued his testimony as to the statements made by Mr. Wekson and Mr. Percine at their EUOs and the conclusions he drew from this testimony which resulted in the denial of these claims on the basis of fraud. The testimony that Mr. Tirone says supports his conclusion that the accident in question was staged are as follows:

The two witnesses testified differently concerning the order in which the passengers in their car were picked up and dropped off by the driver;

Mr. Percine delayed his medical treatment until two (2) weeks after the accident and that Mr. Wekson referred him to the provider;

Mr. Wekson sought treatment from a different provider than he had been treated by for injuries from a prior accident;

The provider from which Mr. Wekser sought treatment was not located near his work or his home.

According to the arguments of counsel, other factors that contributed to Mr. Tirone’s recommendation that the claims be denied on the basis of fraud are:

that the driver of the second car appears to have been “selected”; (No basis for this conclusion was presented at trial)

that the witnesses would not sign their EUO transcripts;

that the passengers in the first car refused to give statements to the investigator;

that the witnesses’ statements at EUO seemed to follow a script;

that the driver of the second car was a woman.

At the close of the trial, the Court invited counsel to present legal memoranda on the standard of proof applicable to defendant’s fraud defense and any other legal issues that had been presented in the trial. Defendant submitted a memorandum on the burden of proof issue. [*3]Plaintiff presented a memorandum arguing that Mr. Tirone should not have been permitted to testify to statements made by the assignors at their EUOs as such statements are hearsay and on the standard of proof issue.

STANDARD OF PROOF APPLICABLE TO FRAUD

In New York, proof of fraud must be made by clear and convincing evidence. Rudman v. Cowles Communications, 30 NY2d 1 (1972). Although defendant argued at trial that in a No-Fault case fraud need only be proven by a preponderance of the evidence, no cases could be found to support this position. In a second submission to the Court, dated March 19, 2005, defendant presented a copy of Hon. Jack Battaglia’s decision in AB Medical Services, PLLC v. State Farm Mut. Auto Ins., 2005 NY Slip Op 25089 (Civil Court, Kings Co.) and argued that it supports defendant’s position that the defense of “staged accident” in a No-Fault case only be proven by a preponderance of the evidence and not by clear and convincing evidence. To the extent that Judge Battaglia’s decision finds that the defense of staged accident need only be proven by a preponderance of the evidence, this Court respectfully disagrees with Judge Battaglia. This Court holds that the insurer’s defense of fraud, whether it be a staged accident or other fraud, requires proof by clear and convincing evidence.

ARE ASSIGNEES’ STATEMENTS MADE AT EXAMINATIONS UNDER OATH ADMISSIBLE AS ADMISSIONS AS AGAINST THE ASSIGNEE/PLAINTIFF?

At trial, the Court permitted defendant’s witness to testify to statements made by the assignors at their Examinations Under Oath on the theory that these statements are admissions by persons united in interest with the plaintiff/assignee. Plaintiff objected at trial that this testimony is hearsay. In its Post Trial Memorandum, plaintiff again argues that its objection at trial should have been sustained. Plaintiff cites to Richardson on Evidence, Farrell 11th ed. (hereinafter “Richardson”), §§8-239 and 8-241 for the “New York doctrine” which states the following:

In New York declarations of a vendor or assignor of a chattel or chose in action, whether made before or after the transfer, are inadmissible to affect the claim or title of a subsequent transferee for value.

Richardson, §8-242.

This rule stems from the decision in Paige v. Cagwin, 7 Hill (NY)361 (Sup Ct 1843) (action on a promissory note) and has been followed in Wangner v. Grimm, 169 NY 421 (1902) (action on a promissory note); Kelly v. Beers, 194 NY 60 (1909) (gift of savings bank account); Merkle v. Beidleman, 165 NY 21 (1900) (mortgage foreclosure). Except where the statements were made by the real party in interest, such as a decedent, and are offered against a person who claims through representation, such as the executor of that decedent, the New York doctrine will apply and the statements of the former owner, vendor or assignor will not be admissible to affect [*4]the claim of the subsequent owner or assignee.

Pursuant to the New York doctrine, the Court erred in permitting defendant’s witness, Mr. Tirone, to testify to the statements of the assignees, Mr. Wekson and Mr. Percine at their EUOs. The Court should have sustained plaintiff’s objections to this testimony. The Court now reverses that ruling and strikes from the record so much of the testimony of Mr. Tirone as concerned the statements of Mr. Wekson and Mr. Percine at their EUOs. With that testimony stricken from the record, the conclusion Mr. Tirone reached, that the accident was staged, is without substantial basis in the record and will not be credited by the Court.

TESTIMONY OF DEFENDANT’S WITNESS

It must be noted that even if all of the evidence of defendant’s witness is credited, defendant has not met its burden of establishing by clear and convincing evidence that the accident in question was staged. Mr. Tirone relied on minor inconsistencies in the testimony of passengers in his insured’s car; the statement that Mr. Percine did not seek medical assistance until two (2) weeks after the accident and then went to a provider referred by Mr. Wekson; that Mr. Wekson sought treatment from a different provider than had treated him for injuries in a prior accident; and that Mr. Wekson obtained treatment from a provider not near his home or work, in concluding that the accident was staged. Each of these facts is capable of a motivation other than that of fraud and together they do not establish clear and convincing proof that the accident in question was staged.

Mr. Tirone testified as to his training and experience in the field of insurance investigation, although there was no request that he be treated as an expert witness. An insurer’s “founded belief” that an accident was staged cannot be based upon “unsubstantiated hypotheses and supposition”. AB Medical Services PLLC v. Eagle Ins. Co., 3 Misc 3d 8 at 9 (App. Term 2nd & 11th Jud. Dists., 2003). However, what experience or training led Mr. Tirone to his conclusions based upon the facts adduced in his investigation is missing from the record. The Court is left to wonder why the fact that an assignor sought medical treatment in a neighborhood different from his home or work is significant. Similarly, the significance of the other car being driven by a woman is not provided by Mr. Tirone’s testimony, yet he relies on this as a basis for finding that the accident was staged. While Mr. Tirone’s trained opinion is entitled to some weight, Travelers Indemnity Co. v. Morales, 188 AD2d 350, 351 (1st Dept 1992), here there is no testimony in the record relating Mr. Tirone’s training and experience to the conclusions he reached based upon the facts of this case. Accordingly, even had the Court not stricken any of Mr. Tirone’s testimony from the record, the determination would be the same that defendant has failed to meet its burden to prove fraud by clear and convincing evidence.

CONCLUSION

For all the foregoing reasons, the Court finds that defendant has failed to meet its burden [*5]at trial to prove its defense of fraud by clear and convincing evidence. Accordingly, judgment is granted to plaintiff for $708 on Mr. Percine’s claim and $1600.50 on Mr. Wekson’s claims. In addition, plaintiff is granted statutory attorneys fees, interest and costs to be computed by the Clerk of the Court.

This constitutes the Decision and Order of the Court.

Exhibits may be retrieved in Chambers, Room 705.

Dated:March 23, 2005

_______________________

LOREN BAILY-SCHIFFMAN

J.C.C.

Footnotes

Footnote 1:Notwithstanding the decision of my colleague in PSG Psychological, PC v. State Farm Ins. Co., 2004 WL 2997955, this Court is of the opinion that EUO transcripts are not governed by CPLR §3116 as they are taken prior to the commencement of litigation and are not part of the Article 31 disclosure process.

[*1]

Civil Court of the City of New York, Kings County, March 10, 2005

APPEARANCES OF COUNSEL

Alden Banniettis, Brooklyn, for plaintiff. Bruno, Gerbino & Soriano LLP, Melville, for defendant.

OPINION OF THE COURT

Arlene P. Bluth, J.

Plaintiff moves for summary judgment pursuant to CPLR 3212. For the following reasons, the plaintiff’s motion is denied. [*2]

In this action, plaintiff Vista Surgical Supplies, Inc. seeks to recover first-party no-fault benefits in the amount of $1,282, plus statutory fees, interest, costs, and attorneys’ fees, for medical supplies it allegedly furnished to plaintiff’s assignor, Julian Rosario, on February 5, 2003. Plaintiff argues that defendant failed to timely deny its no-fault claims.

The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law by tendering sufficient evidence in admissible form to demonstrate the absence of any material issues of fact. (See Alvarez v Prospect Hosp., 68 NY2d 320 [1986].) The motion must be supported by an affidavit from a person with knowledge of the facts, setting forth all material facts. (See CPLR 3212 [b].) If, in opposing the motion, the other party comes forward with evidence of issues of fact requiring a trial, the motion will be denied. (See Rebecchi v Whitmore, 172 AD2d 600 [2d Dept 1991].)

In a no-fault context, a health care provider establishes prima facie entitlement to summary judgment as a matter of law by submitting proof in admissible form demonstrating that it is an assignee under a properly executed assignment, that the prescribed statutory claim form, setting forth the fact and amount of the loss sustained, was mailed to and received by the defendant, and that payment of no-fault benefits is overdue. (See 11 NYCRR 65-3.11 [b] [2]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2d Dept 2004]; Triboro Chiropractic & Acupuncture P.L.L.C. v Electric Ins. Co., 2 Misc 3d 135[A], 2004 NY Slip Op 50215[U] [App Term, 2d & 11th Jud Dists 2004].) If the plaintiff makes out its prima facie case, the burden then shifts to the defendant.

In support of the motion, plaintiff submits the affirmation of its attorney and affidavit from an officer of plaintiff. It is axiomatic that a party’s attorney “who lacks personal knowledge of the essential facts, is of no probative value and is insufficient to support an award of summary judgment.” (Peters v City of New York, 5 Misc 3d 1020[A], 2004 NY Slip Op 51469, *8 [Sup Ct, Kings County 2004]; see also Zuckerman v City of New York, 49 NY2d 557 [1980]; Amaze Med. Supply Inc. v Allstate Ins. Co., 3 Misc 3d 133[A], 2004 NY Slip Op 50447[U] [App Term, 2d & 11th Jud Dists 2004]; Lupinsky v Windham Constr. Corp., 293 AD2d 317 [1st Dept 2002].)

The affidavit of Igor Kats, an officer of Vista Surgical Supplies, is also insufficient. Mr. Kats’ affidavit contains no recitations of fact particular to this case, such as the dates of service, the supplies allegedly provided, dates of mailing or amount outstanding. Rather, Mr. Kats’ affidavit contains boilerplate language^[FN*] about the authenticity of nonspecified bills and assignment from a nonspecified assignor which was witnessed either by him or someone on his staff in his office on an unspecified date. Instead of setting forth the facts in admissible form, Mr. Kats merely adopts the statements of plaintiff’s counsel as contained in the attorney’s affirmation. By adopting the contents of an affirmation which has no probative value, the plaintiff’s affidavit—itself barren of material facts—is also of no probative value.

Moreover, in his affidavit, Mr. Kats declares that “[t]he above is the same testimony that I would present to this court at trial.” If it came to that, plaintiff would lose at trial for failure to set forth a prima facie case. At trial, Mr. Kats would not be able to say, “I adopt whatever my attorney said.”

Because plaintiff’s affidavit does not satisfy CPLR 3212 (b), plaintiff is not entitled to summary judgment. Accordingly, plaintiff’s motion is denied.

Footnotes

Footnote *: Indeed, Mr. Kats’ affidavit is identical to the one he submitted in at least two completely different cases (under Index Nos. 064662/04 and 056074/04), decided simultaneously herewith.

[*1]

Civil Court of the City of New York, Kings County, March 9, 2005

APPEARANCES OF COUNSEL

Harvey L. Woll for plaintiffs. Shapiro, Beilly, Rosenberg, Aronowitz, Levy & Fox, LLP (Thomas J. Nemia of counsel), for defendant.

OPINION OF THE COURT

Jack M. Battaglia, J.

In this consolidated action for first-party no-fault benefits, five providers of physical therapy, chiropractic, acupuncture, or transportation services seek payment from State Farm Mutual Automobile Insurance Company for services provided to six persons allegedly injured in automobile collisions. There are 197 separate bills, which total $78,987.74.

The only issue for trial was whether the alleged injuries arose from “staged accidents.” In two of the four consolidated cases, plaintiffs’ motions for summary judgment were denied, and the denials were upheld on appeal. (See A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 5 Misc 3d 133[A], 2004 NY Slip Op 51432[U] [App Term, 9th & 10th Jud Dists 2004]; A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., App Term, 2d & 11th Jud Dists, June 22, 2004, No. 2003-1057 KC.) As held by Appellate Term for the Second and Eleventh Judicial Districts in one of the cases, the affidavit of State Farm’s investigator “set forth sufficient facts to demonstrate that [State Farm] possessed a ‘founded belief that the alleged injury does not arise out of an insured accident.’ ” (Id. at SM-2, quoting Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997].) The holding of Appellate Term for the Ninth and Tenth Judicial Districts in the other case is to the same effect. (See A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 2004 NY Slip Op 51432[U], *2.)

In Central Gen. Hosp. v Chubb Group of Ins. Cos. (90 NY2d 195 [1997]), the Court [*2]of Appeals held that “an insurer, despite its failure to reject a claim within the 30-day period” prescribed by the governing statute and regulations, “may assert a lack of coverage defense premised on the fact or founded belief that the alleged injury does not arise out of an insured incident.” (Id. at 199 [emphasis added].) “[T]he preclusion remedy does not apply to a defense of no coverage at all.” (Id. at 202.)

“A deliberate collision caused in furtherance of an insurance fraud scheme is not a covered accident.” (State Farm Mut. Auto. Ins. Co. v Laguerre, 305 AD2d 490, 491 [2d Dept 2003]; see also Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751, 751-752 [2d Dept 2002].) Indeed, when a collision is “an intentional act, not an accident,” there is no coverage (see Westchester Med. Ctr. v Travelers Prop. Cas. Ins. Co., 309 AD2d 927, 928 [2d Dept 2003]), “regardless of whether the intentional collision was motivated by fraud or malice” (see Matter of Government Empls. Ins. Co. v Shaulskaya, 302 AD2d 522, 523 [2d Dept 2003]).

The insurer “has the burden to come forward with proof in admissible form to establish ‘the fact’ or the evidentiary ‘found[ation for its] belief’ ” that there is no coverage. (See Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 19-20 [2d Dept 1999], quoting Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d at 199; see also Hospital for Joint Diseases v Hertz Corp., 9 AD3d 392, 392 [2d Dept 2004]; St. Luke’s Roosevelt Hosp. v Allstate Ins. Co., 303 AD2d 743, 744 [2d Dept 2003].)

It is not easy for this court to know what to make of the “fact or founded belief” formulation in Chubb. It would seem that either there is coverage, or there is not; that either there was a “staged accident,” or there was not. We generally do not relieve a contracting party from performance under the contract because the party “believes” that performance is not required, whether “founded” or not, if in “fact” performance is required. The formulation does, however, reflect that a determination as to coverage is often a function of circumstance and inference, and the formulation does fairly reflect the evidentiary burdens when there is a dispute as to coverage.

“An insured seeking to recover for a loss under an insurance policy has the burden of proving that a loss occurred and also that the loss was a covered event within the terms of the policy.” (Gongolewski v Travelers Ins. Co., 252 AD2d 569, 569 [2d Dept 1998], quoting Vasile v Hartford Acc. & Indem. Co., 213 AD2d 541, 541 [2d Dept 1995]; see also Dato Jewelry v Western Alliance Ins. Co., 238 AD2d 193, 193 [1st Dept 1997].) Whatever the risk or loss covered, it has long been the insured’s burden to prove coverage under the policy. (See Lavine v Indemnity Ins. Co., 260 NY 399, 410 [1933]; Whitlatch v Fidelity & Cas. Co. of N.Y., 149 NY 45, 48 [1896]; Zuckerberg v Blue Cross & Blue Shield of Greater N.Y., 108 AD2d 56, 61 [2d Dept 1985], affd 67 NY2d 688 [1986]; Washburn v Wholehealth Ins. Network, 196 AD2d 813, 815 [2d Dept 1993]; Glogvics v Preferred Acc. Ins. Co. of N.Y., 245 App Div 817, 817 [2d Dept 1935]; Bracey v Metropolitan Life Ins. Co., 54 Misc 2d 175, 180 [App Term, 2d Dept 1967].) [*3]

In an action for first-party no-fault benefits, “a provider’s proof of a properly-completed claim makes out a prima facie case” (see Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U], *3 [App Term, 2d & 11th Jud Dists]; see also A.B. Med. Servs. PLLC v Lumbermens Mut. Cas. Co., 4 Misc 3d 86, 87 [App Term, 2d & 11th Jud Dists 2004]). To adopt Appellate Term’s conception in the related area of medical necessity, there is a “presumption of [coverage] which attaches to the claim form.” (See Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 7 Misc 3d 18, 22 [App Term, 2d & 11th Jud Dists 2004].)

As stated, the insurer bears the burden of coming forward with admissible evidence of “the fact” of lack of coverage or of the “found[ation for its] belief” that there is no coverage. (See Mount Sinai Hosp. v Triboro Coach, 263 AD2d at 19-20.) But the burden of coming forward with evidence is not the burden of persuasion. (See McClelland v Climax Hosiery Mills, 252 NY 347, 358 [1930] [Cardozo, Ch. J., concurring].) “Shifting the burden of explanation or of going on with the case does not shift the burden of proof.” (Plumb v Richmond Light & R.R. Co., 233 NY 285, 288 [1922]; Matter of Philip M., 82 NY2d 238, 244 [1993].)

The burden of persuasion stays with the plaintiff, and if the insurer carries its burden of coming forward, “plaintiff must rebut it or succumb.” (See Baumann v Long Is. R.R., 110 AD2d 739, 741 [2d Dept 1985].) Appellate Term appears to have recognized these evidentiary burdens, and their consequences, again in the context of medical necessity.

“[W]here the plaintiff relies solely on its proof of claim to establish a prima facie showing, without any additional submission of proof of medical necessity in admissible form, and, in opposition, the defendant provides proof in admissible form of the lack of medical necessity, summary judgment may, in appropriate circumstances, be awarded to the defendant unless the plaintiff comes forward with admissible proof in reply to create a triable issue of fact.” (A.B. Med. Servs. v New York Cent. Mut. Fire Ins. Co., 3 Misc 3d 136[A], 2004 NY Slip Op 50507[U], *2 [App Term, 2d & 11th Jud Dists 2004].)

In this action, the only witness at trial (other than a witness to allow State Farm to attempt to make an evidentiary record as to a rejected defense) was Robert Battista, who is employed as an investigator in State Farm’s Special Investigative Unit. Mr. Battista provided the affidavits submitted on the motions for summary judgment that Appellate Term for both the Second and Eleventh Judicial Districts and for the Ninth and Tenth Judicial Districts found “sufficient . . . to demonstrate that [State Farm] possessed a ‘founded belief’ ” that the “accidents” here were “staged.” (See A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., June 22, 2004, No. 2003-1057 KC, at SM-2.)

Mr. Battista’s testimony at trial essentially tracked the affidavits submitted on the [*4]summary judgment motions, and it may be that Appellate Term has, in effect, determined that his testimony is sufficient to carry State Farm’s burden of coming forward on the question of coverage, with the result that plaintiffs were then required to rebut State Farm’s “founded belief” in order to sustain their burden of persuasion on coverage. “A denial of a motion for summary judgment is not necessarily . . . the law of the case . . . that will be established at trial.” (Sackman-Gilliland Corp. v Senator Holding Corp., 43 AD2d 948, 949 [2d Dept 1974] [emphasis added].) After all, “the evidence may be different at trial.” (See S.L. Benfica Transp., Inc. v Rainbow Media, Inc., 13 AD3d 348, 349 [2d Dept 2004].)

That does not mean that there is no place for the law of the case doctrine after denial of a summary judgment motion. (See Seneca Trucking Co. v D.H. Overmeyer Co., 36 AD2d 894, 894 [4th Dept 1971].) Here, two appellate panels and two trial court judges have concluded, based upon evidence virtually the same as that introduced at this trial, that State Farm had a “founded belief” that the “accidents” were “staged.” The avoidance of “inefficiency and disorder” that is the goal of the law of the case doctrine (see People v Evans, 94 NY2d 499, 503-504 [2000]) would be served by this court’s adoption of the conclusions reached by those who have already considered this case.

The court recognizes that there is case law that would suggest a different allocation of evidentiary burdens for allegations of a “staged accident.” “In an action to recover the proceeds of a fire insurance policy, it is the insurer’s burden to establish the affirmative defense of arson,” and the “measure of persuasion is that of clear and convincing evidence.” (Hutt v Lumbermens Mut. Cas. Co., 95 AD2d 255, 256-257 [2d Dept 1983]; see also 3910 Super K v Pennsylvania Lumbermens Mut. Ins. Co., 219 AD2d 589, 589-590 [2d Dept 1995].) There are important differences, however, between the “affirmative defense of arson” and the issue of coverage for an intentional collision.

The arson defense requires proof of both the incendiary nature of the fire and that it was set by or with the consent of the insured. (See Chenango Mut. Ins. Co. v Charles, 235 AD2d 667, 668-669 [3d Dept 1997]; Ausch v St. Paul Fire & Mar. Ins. Co., 125 AD2d 43, 45 [2d Dept 1987].) That is why proof of financial motive is so important in arson cases. (See Schlegel v Aetna Cas. & Sur. Co., 282 AD2d 516, 517 [2d Dept 2001]; Chenango Mut. Ins. Co. v Charles, 235 AD2d at 669.) It is “because arson is but one form of fraud in making a claim under a policy” that “an inference of arson must be strong and almost inevitable.” (Hutt v Lumbermens Mut. Cas. Co., 95 AD2d at 256-257 [internal quotations marks, brackets and citations omitted].)

With an alleged “staged accident” or other intentional collision, it is the intent that is crucial, not the motive, financial or otherwise, and even the innocent insured is deprived of coverage. (See McCarthy v Motor Veh. Acc. Indem. Corp., 16 AD2d 35 [4th Dept 1962], affd 12 NY2d 922 [1963]; Matter of Progressive Northwestern Ins. Co. v Van Dina, 282 AD2d 680 [2d Dept 2001]; Matter of Aetna Cas. & Sur. Co. v Perry, 220 AD2d 497 [2d Dept 1995].) The appellate decisions dealing with intentional collisions, whether “motivated by fraud or malice” (see Government Empls. Ins. Co. v Shaulskaya, 302 AD2d at 523), characterize the insurer’s “defense” as lack of coverage; there is no indication that the evidentiary burdens and “measure of persuasion” (see Hutt v Lumbermens Mut. Cas. Co., 95 AD2d at 256-257) are to differ when an alleged intentional collision might be motivated by fraud.

Similarly, in Dato Jewelry v Western Alliance Ins. Co. (238 AD2d 193 [1st Dept 1997]), where the insurer was estopped from asserting a “dishonest theft” exclusion from coverage for an alleged jewelry robbery, because the insurer did not deny coverage on that basis (see id. at 193), the jury was properly charged that “the burden was on the insured to prove the robbery was legitimate rather than on the insurer to prove it was staged” (see id.). Generally, an insurer bears the burden of proving an exclusion from coverage. (See Neuwirth v Blue Cross & Blue Shield of Greater N.Y., Blue Cross Assn., 62 NY2d 718, 719 [1984]; Utica Mut. Ins. Co. v Prudential Prop. & Cas. Ins. Co., 103 AD2d 60, 63 [2d Dept 1984].) Lack of coverage is not an exclusion. (See State Farm Mut. Auto. Ins. Co. v Laguerre, 305 AD2d at 491-492.)

Arson may be established by circumstantial evidence (see Stone v Continental Ins. Co., 234 AD2d 282, 283 [2d Dept 1996]), as may fraud generally (see Booth v Bunce, 33 NY 139, 159 [1865]; Hickok v Cowperthwait, 134 App Div 617, 618 [2d Dept 1909]). “Circumstances insignificant in themselves may acquire probative force as links in the chain of circumstantial proof.” (Van Iderstine Co. v Barnet Leather Co., 242 NY 425, 435 [1926].) It may be that in a case like this, where the only admissible evidence on whether the collision was intentional is that submitted by the insurer, the evidentiary burdens and standard of proof will not determine the result.

The court recognizes, however, that some of the information that Mr. Battista relied upon in his affidavits was hearsay that was not rendered admissible by appropriate foundation, and that those opposing a motion for summary judgment are, within limits, permitted to rely on otherwise inadmissible information. (See Phillips v Kantor & Co., 31 NY2d 307, 311-312 [1972]; Kwi Bong Yi v JNJ Supply Corp., 274 AD2d 453, 453 [2d Dept 2000]; Chubb & Son v Riverside Tower Parking Corp., 267 AD2d 128, 128 [1st Dept 1999].) The Appellate Term opinions here do not specify the information that the respective panels found admissible and sufficient and the information, if any, that was not considered. It is this court’s view that, even without the inadmissible information that was submitted on the motions, State Farm sufficiently established at trial its founded belief that there is no coverage.

Three of plaintiffs’ assignors—Cindy Toledo, Kimberly Toledo and Joseph Murray—were allegedly injured on December 7, 2001 when the vehicle in which they were riding, a 1987 Pontiac Bonneville, was rear-ended by a 1987 Chevy Caprice. The vehicle in which plaintiffs’ assignors were riding was owned by Marianna Manoylo, and was insured by State Farm. Coverage for the Manoylo vehicle was obtained pursuant to the assigned risk program. Although the policy was written in May 2001, it was changed only four days before the collision to cover Ms. Manoylo’s Bonneville. The coverage was canceled less than two months after the collision [*5]because of nonpayment of the premium.

The other three of plaintiffs’ assignors—Yuriy Ozerov, Nathan Shylakh and Marlen Belyavsky—were allegedly injured on February 10, 2002 when the vehicle in which they were riding, a 1991 Ford Tempo, was rear-ended by a 1989 Plymouth Voyager. The vehicle in which plaintiffs’ assignors were riding was owned by Mr. Ozerov, and was insured by State Farm. Coverage for the Ozerov vehicle was obtained pursuant to the assigned risk program approximately one month before the collision, and was canceled one month after the collision because of nonpayment of the premium.

In addition to the similarities between the December 2001 collision and the February 2002 collision that are apparent from the above recitation, two of the persons riding in the State Farm-insured vehicle at the time of the February 2002 collision had relationships with persons who were involved in the December 2001 collision. Marlen Belyavsky’s mother is Svetlana Manoylo, and they both resided with Marianna Manoylo. And Nathan Shylakh resided with Oksana Shylakh, who was a passenger in the Chevy Caprice that rear-ended the Manoylo vehicle. Moreover, Nathan Shylakh and Yuriy Ozerov, the owner and driver of the State Farm-insured vehicle, were involved in another collision approximately one year earlier.

State Farm obtained examinations under oath of Cindy Toledo and Kimberly Toledo (Dec. 2001 collision) and of Yuriy Ozerov, Nathan Shylakh and Marlen Belyavsky, the latter with his mother, Svetlana Manoylo (Feb. 2002 collision). At the examinations, all three of the assignors who were involved in the February 2002 collision purported to withdraw the claims that had been submitted to State Farm, an effort that was ineffective. (See 11 NYCRR 65-3.11 [d].)

In addition to the circumstances recited so far, based upon evidence admitted at trial, in disclaiming coverage State Farm relied on other circumstances, based upon documents not properly admitted into evidence. State Farm pointed to discrepancies and other problems revealed by the transcripts of the examinations under oath of Cindy Toledo and Kimberly Toledo, but State Farm did not lay any foundation or make any other showing that would support the admissibility of the transcripts.

State Farm also pointed to information obtained from the National Insurance Crime Bureau (NICB), which serves as a clearinghouse of sorts for data from insurance companies concerning claims made against all types of policies. Certainly, such “loss histories” were material to the issues to be determined. (See Rickert v Travelers Ins. Co., 159 AD2d 758, 760 [3d Dept 1990].) But State Farm did not lay any foundation or make any other showing that would support the admissibility of this NICB information. State Farm did cite People v Veloz (273 AD2d 259 [2d Dept 2000]) as authority for the admissibility of NICB information, but the Court there merely stated that “the National Insurance Crime Bureau records were properly admitted into evidence as business records,” without any description of the “records” admitted or of any foundation that may have been laid for admittance (see id. at 259). [*6]

In the interest of completeness, the court notes that the NICB information offered by State Farm indicated a significant insurance claim history for Marianna Manoylo, Svetlana Manoylo and Oksana Shylakh. The information also revealed that the owner and driver of the second vehicle involved in the February 2002 collision, Ediberto Olavarria, had been involved in a collision on December 29, 2001 together with a David Fich, and that Mr. Fich had been in a collision on April 30, 2001 together with Svetlana Manoylo. Again, this information is inadmissible hearsay.

In addition to the inferences arising from the facts and circumstances related to the collisions, State Farm argues that the purported withdrawal of claims by the assignors involved in the February 2002 collision evidences a “consciousness of guilt” that constitutes an “admission by conduct,” at least as to those assignors. (See Nowack v Metropolitan St. Ry. Co., 166 NY 433, 437, 439, 442 [1901]; Kamenov v Northern Assur. Co. of Am., 259 AD2d 958, 959 [4th Dept 1999]; Bazza v Banscher, 143 AD2d 715, 716 [2d Dept 1988].) Since State Farm is not offering the purported withdrawal to divest plaintiffs of their title to the claims sued upon (see Tierney v Fitzpatrick, 195 NY 433, 434 [1909]; Dinnebeil v Ringer, 101 Misc 658, 663-664 [App Term, 1st Dept 1917]), the inference that arises from the assignors’ conduct appears to be admissible against plaintiffs (see Leon Sylvester, Inc. v Aetna Cas. & Sur. Co., 227 AD2d 212 [1st Dept 1996]; see also Kamenov v Northern Assur. Co. of Am., 259 AD2d at 958-959). Since the withdrawal of the claims, however, is not unequivocally referable to “guilt,” the inference here has some, but not substantial, probative value.

Although an insurer’s “founded belief” that a collision was “staged” cannot be based upon “unsubstantiated hypotheses and suppositions” (see A.B. Med. Servs. v Eagle Ins. Co., 3 Misc 3d 8, 9-10 [App Term, 2d Dept 2003]; Amstel Chiropractic v Omni Indem. Co., 2 Misc 3d 129[A], 2004 NY Slip Op 50088[U], *1-2 [App Term, 2d & 11th Jud Dists 2004]), of necessity in most cases it will be established by circumstantial evidence (see State Farm Mut. Auto. Ins. Co. v Laguerre, 305 AD2d at 491; A.B. Med. Servs. PLLC v State Farm Mut. Auto. Ins. Co., 4 Misc 3d 83, 84-85 [App Term, 9th & 10th Jud Dists 2004]; Matter of Progressive County Mut. Ins. Co. [McNeil], 4 Misc 3d 1022[A], 2004 NY Slip Op 50998[U], *2 [Sup Ct, Nassau County 2004]; Matter of National Grange Mut. Ins. Co. v Vitebskaya, 1 Misc 3d 774, 775-777 [Sup Ct, Kings County 2003]). Mr. Battista testified that the facts and circumstances that he relied upon in reaching his conclusion that the two collisions here were “staged” are recognized as probative in the field of insurance fraud investigation, but State Farm made no attempt to introduce any documents or other evidence of that.

Mr. Battista’s trained opinion is entitled to some weight (see Matter of Travelers Indem. Co. v Morales, 188 AD2d 350, 351 [1st Dept 1992]), but, at least in this action, the strength of the inferences must be measured by “common sense” and the “logic of common experience itself” (see Schneider v Kings Highway Hosp. Ctr., 67 NY2d 743, 744-745 [1986]). So measured, the court considers the evidence sufficient to carry State Farm’s burden of coming forward with a “founded belief” that the collisions were “staged.” [*7]

This conclusion is buttressed by the failure of plaintiffs to call any of the assignors to testify at trial. The assignors would have been expected to give testimony that was material and noncumulative, and, most importantly, testimony that would be favorable to plaintiffs. (See People v Savinon, 100 NY2d 192, 197 [2003].) Plaintiffs made no showing that any of the assignors was “unavailable,” either in fact or on a plea of privilege (see id. at 197-199), and no explanation was offered for their not having been subpoenaed to testify (see id. at 199-200). It may be that even “Herculean lengths” (see id. at 199) would not have produced any of the assignors in court, but on this record the court takes a “permissive adverse inference” (see id. at 201) that they would not have helped plaintiffs’ cause.

Plaintiffs introduced no evidence to rebut the inferences supporting a conclusion that the State Farm policies provide no coverage for the December 2001 and February 2002 collisions. Any statements by the drivers that the investigating officers noted in the respective police accident reports were, in the context of this action, inadmissible to establish that an “accident” occurred. (See Cover v Cohen, 61 NY2d 261, 274 [1984]; Bates v Yasin, 13 AD3d 474, 474 [2d Dept 2004]; Hoffman v Eastern Long Is. Transp. Enter., 266 AD2d 509, 510 [2d Dept 1999].)

Counsel ably attempted, by cross-examination of Mr. Battista and argument, to weaken the strength of State Farm’s showing. One may accept, for example, that older vehicles will often be insured pursuant to the assigned risk program. And one could agree that it is more likely for an older vehicle damaged in a collision not to be repaired, and for its insurance to be allowed to lapse. But, here, we have two collisions that occurred within a short window of insurance coverage, with four vehicles each more than 10 years old, and relationships linking an owner or at least one occupant of three of the vehicles. In each of the collisions, moreover, the State Farm vehicle was rear-ended when stopped, and, according to the police accident reports, the drivers of the vehicles that hit them were particularly accommodating in acknowledging fault.

The court is mindful that there was no direct evidence that any of the plaintiffs here knowingly participated in any insurance fraud scheme, or even suspected one. But “[w]here a loss is caused by the fraud of a third party, in determining the liability as between two innocent parties, the loss should fall on the one who enabled the fraud to be committed.” (Fidelity Natl. Tit. Ins. Co. of N.Y. v Consumer Home Mtge., 272 AD2d 512, 514 [2d Dept 2000].) Although any fraudulent conduct of the assignors might not be “properly imputed” to plaintiffs (see id.; see also A&S Med. v Allstate Ins. Co., 196 Misc 2d 322, 324 [App Term, 1st Dept 2003], affd 15 AD3d 170 [1st Dept 2005]), plaintiffs would be among the “primary beneficiaries of [the] fraud” (see Chubb & Son v Consoli, 283 AD2d 297, 299 [1st Dept 2001]). And, generally, “[a]n assignee stands in the shoes of the assignor” (see Arena Constr. Co. v J. Sackaris & Sons, 282 AD2d 489, 489 [2d Dept 2001]).

Plaintiffs, moreover, have remedies available to them that are not available to the millions of New York motorists that pay the additional premium costs that the Court of Appeals has identified as resulting from automobile insurance fraud (see Matter of Medical Socy. of State of N.Y. v Serio, 100 [*8]NY2d 854, 861 [2003]). Service providers may explicitly include in their assignment documents provision for recourse against the assignor if the insurer does not pay because of lack of coverage, and the providers may bring an assignor into any action against the carrier when the carrier defends nonpayment on the ground of lack of coverage.

Plaintiffs have failed to persuade this court that the State Farm policies provide coverage for the claims at issue.

Judgment awarded to State Farm, dismissing the claims.

Civil Court of the City of New York, Kings County

062603/03

Arlene P. Bluth, J.

Upon the foregoing cited papers, defendant moves to vacate and set aside a judgment entered against it on August 12, 2004, to enforce an alleged settlement and discontinuance agreement, and for sanctions. Plaintiff cross-moves for sanctions and costs. For the following reasons, defendant’s motion and plaintiff’s cross-motion are denied. [*2]

The pertinent facts on this motion and cross-motion are as follows: On April 8, 2003, plaintiff Brooklyn Heights Medical, P.C. sued to recover first-party No-Fault benefits in the amount of $4,199.05 plus statutory interest, costs, and attorneys’ fees for healthcare services allegedly rendered to plaintiff’s assignor, Elene Barrow. On May 24, 2004, this Court, in an Order by the Hon. Sylvia Hinds-Radix after oral argument, awarded summary judgment to plaintiff in the amount of $4,199.05 “as set forth in the summons and complaint.” Thereafter, the parties negotiated a settlement of the case for $3,000, apparently to facilitate swifter payment to plaintiff than by execution of the judgment, albeit of a lesser sum. On June 9, 2004, plaintiff’s counsel faxed to defendant’s counsel a typed, unsigned stipulation of settlement and discontinuance. The first page stated: “Please sign for confirmation and fax back to our office ASAP.” The stipulation of discontinuance also provided that if full payment was not made within 30 days, the stipulation would become null and void.

Defendant’s counsel telephoned plaintiff’s counsel requesting that signed stipulations be forwarded. Plaintiff’s counsel informed him that the firm’s policy was to require that the opposing party sign the documents first. On July 8, 2004, plaintiff’s counsel faxed a letter to

defendant’s counsel stating that, although 30 days had passed with no payment on the settlement forthcoming, defendant’s counsel would be given an additional seven days to submit payment and return the signed documents. Otherwise, the letter warned, the settlement would be deemed null and void. Defendant’s counsel did not submit payment or sign the stipulation. Defendant’s counsel claims he faxed a letter to plaintiff’s counsel on July 19, 2004 demanding a signed stipulation; however, the fax report appended to defendant’s exhibit indicates a failed transmission.

Defendant’s attempt to escape the judgment against it by breathing life into an unconsummated settlement has no legal support. The CPLR is clear that “[a]n agreement between parties or their attorneys relating to any matter in an action, other than one made between counsel in open court, is not binding upon a party unless it is in a writing subscribed by him or his attorney or reduced to the form of an order and entered.” CPLR § 2104. Neither plaintiff nor plaintiff’s counsel ever “subscribed” i.e., signed the stipulation at issue. Therefore, plaintiff is not bound by the settlement.

Plaintiff was free to attach any conditions it wished to its settlement offer. Likewise, defendant was free to reject the offer based on objections to any of plaintiff’s terms. By failing to sign the stipulation and forward payment thereunder, defendant effectively rejected plaintiff’s offer, and allowed it to lapse on its terms.^[FN1] The case law cited by defendant is inapposite. Although detrimental reliance on an oral stipulation may preclude the application of CPLR [*3]

§ 2104, that exception does not apply on these facts. See La Marque v. North Shore Univ. Hosp., 120 AD2d 572, 573 [2nd Dept 1986].

Accordingly, defendant’s motion to vacate the judgment against it and enforce the settlement is denied. Because the Court does not find that either party acted in bad faith, defendant’s motion for sanctions and plaintiff’s cross-motion for sanctions and costs are both denied.

This is the Decision and Order of the Court.

Dated:

ARLENE P. BLUTH

Judge, Civil Court

ASN by__________ on __________

Footnotes

Footnote 1: The Court notes that if defendant’s counsel would have in fact signed and returned the stipulation, it would have been binding on plaintiff even without signature by plaintiff or its counsel. See Stefaniw v. Cerrone, 130 AD2d 483 [2nd Dept 1987].

Civil Court of the City of New York, Kings County

035013/04

Arlene P. Bluth, J.

Upon the foregoing cited papers, plaintiff moves for summary judgment pursuant to CPLR § 3212, and defendant cross-moves to compel depositions of plaintiff, plaintiff’s assignor, and plaintiff’s treating physicians pursuant to CPLR § 3124 and 3126. For the following reasons, plaintiff’s motion is granted, and defendant’s motion [*2]is denied as moot.^[FN1]

In this action, plaintiff Vital Points Acupuncture, P.C. seeks to recover first-party No-Fault benefits in the amount of $2,299 plus statutory, interest, costs, and attorneys’ fees, for healthcare services it allegedly rendered to plaintiff’s assignor, Muller Pierre, from May 28, 2003 to August 6, 2003, following an alleged accident on May 16, 2003.

Plaintiff submitted six bills to defendant, all of which were denied. The first four bills, mailed on June 10, 2003; June 25, 2003; July 15, 2003; July 28, 2003; and August 12, 2003, were each denied on August 15, 2003 on the ground that “medical justification ha[d] not been established”since plaintiff’s assignor had failed to appear for two independent medical examinations (IMEs). The last two bills were denied on September 22, 2003, and included an additional ground for denial: a so-called “low impact study” commissioned by the insurer and conducted on August 26, 2003, which found that the extent of injuries alleged could not have been caused by the accident.

To establish a prima facie entitlement to summary judgment as a matter of law, a plaintiff healthcare provider must submit proof in admissible form demonstrating that it is an assignee under a properly executed assignment, that the prescribed statutory claim form, setting forth the fact and amount of the loss sustained, was mailed to and received by the defendant, and that payment of no-fault benefits is overdue. See NYCRR 65-3.11(b)(2); Mary Immaculate Hosp. v. Allstate Ins. Co. 5 AD3d 742 [2d Dept 2004]; Triboro Chiropractic and Acupuncture P.L.L.C. ex rel. Tacopino v. Electric Ins. Co., 2 Misc 3d 135(A) [App Term, 2d & 11th Jud Dists 2004]. Plaintiff in this case has done so, thereby shifting the burden to defendant. The alleged defects in plaintiff’s proof of claim and assignment of benefits raised by defendant are without merit because defendant has waived any objections to plaintiff’s proof of claim and assignment form by not requesting verification of either during the prescribed 30-day period. See Park Health Ctr. v. Eveready Ins. Co., 2001 NY Slip Op 40665(U) [App Term, 2d and 11th Jud Dists 2001]; Mt. Sinai Hosp. v. Triboro Coach, 263 AD2d 11 [2d Dept 1999].

Further, defendant’s denials based on Mr. Pierre’s failure to attend IMEs were ineffective because defendant did not comply with the regulations governing requests for additional verification. The regulations treat a request for an IME as a request for additional verification. See 11 NYCRR 65-3.5(c). Thus, the insurer was required to give Mr. Pierre a second opportunity to undergo the requested IMEs by following up with a second verification request within 10 calendar days of the first request. See 11 NYCRR 65-3.6(b).

Irrespective of the untimeliness of its denials, however, defendant has raised a defense of lack of coverage. An insurer may assert at any time that the accident arises from an insurance fraud scheme or that the alleged injury was not caused by an insured incident and is therefore not covered under plaintiff’s policy. Central Gen. Hosp. v. Chubb Group of Ins. Companies, 90 NY2d 195 [1997]; Metro Medical Diagnostics, P.C. v. Eagle Ins. Co., 293 AD2d 751 [2d Dept 2002]; Amaze Med. Supply, Inc. v. AIU Ins. Co., 5 Misc 3d 139(A) [App Term, 9th & 10th Jud Dists 2004]; S & M Supply, Inc. v. Nationwide Mut. Ins. Co., 3 Misc 3d 138(A) [App Term, 2nd & 11th Jud Dists 2004]. A defense based upon lack of coverage must be “premised on the fact or founded belief that the alleged injury does not arise out of an insured incident.” See Central Gen. Hosp. v. Chubb Group of Ins. Companies, 90 NY2d 195, 199 [1997]; see also A.B. Medical Svcs. P.L.L.C. v. State Farm Mut. Auto. Ins. Co., 4 Misc 3d 143(A) [App Term, 2d and 11th Jud Dists 2004] .

Defendant bases its lack of coverage defense on the results of a so-called low-impact study which claims to show that the alleged accident could not have caused the injuries allegedly suffered by plaintiff’s assignor. In support of its allegation, defendant submits the sworn affidavit of Alfred Cipriani, an employee of FTI/SEA Consulting Applied Science, the company that conducted the study at defendant’s request. The low-impact study by itself, [*3]however, does not create a triable issue of fraud or lack of coverage. See A.M. Med., P.C. v. New York Cent. Mut. Ins. Co., 2 Misc 3d 918 [Civ Ct, Queens Cty 2004]. Mr. Cipriani’s affidavit does not explain in any detail and in non-technical language how the study was conducted and what the results mean. It does not specify the documents or physical evidence FTI/SEA relied upon, and does not establish any factual basis for the study’s conclusions or why such conclusions are reliable. Mr. Cipriani does not explain how the test was conducted, nor does the affidavit explain how the injuries of plaintiff’s assignor are incompatible with the study results.

Likewise, the affidavit of Justin Barth, a no-fault specialist for the insurer, does not indicate why the insurer believed that the alleged injury did not arise out of an insured incident and decided to commission a low-impact study in this case. Further, it fails to specify whether the alleged fraudulent conduct was a staged accident or the provider’s unilateral scheme to obtain no-fault benefits for unnecessary or excessive medical treatment, the latter being precluded by defendant’s untimely denials. See Melbourne Med., P.C. v. Utica Mut. Ins. Co., 4 Misc 3d 92, [App Term, 2nd Dept 2004].

Therefore, defendant has failed in its opposition papers to allege facts with the requisite particularity to create triable issues of fraud or lack of coverage. See A.B. Medical Services PLLC v. State Farm Mutual Auto Ins. Co., 3 Misc 3d 130(A) [App Term, 2d & 11th Jud Dists 2004]; Amstel Chiropractic P.C. JYQ Acupuncture P.C. v. Omni Indemnity Co., 2 Misc 3d 129 [2d and 11th Jud Dists 2004] (finding that unsubstantiated hypotheses and suppositions are insufficient to raise a triable issue of the assignor’s fraud); cf. Ocean Diagnostic Imaging P.C. v. State Farm Mut. Ins. Co., 2004 NY Slip Op 24498 [2d and 11th Jud Dists 2004] (investigator’s affidavit set forth ample facts and founded beliefs to establish the existence of a triable issue of fact as to whether there was a lack of coverage).

Accordingly, plaintiff is awarded summary judgment in the amount of $2,299 plus statutory interest, costs, and attorneys’ fees.

This is the Decision and Order of the Court.

Dated:

ARLENE P. BLUTH

Judge, Civil Court

ASN by__________ on __________

Footnotes

Footnote 1:This decision is issued in conjunction with this Court’s decision in a companion case, Vital Points Acupuncture, P.C. a/a/o Claudette Pierre v. New York Central Mutual Fire Insurance Company, Index Number 35007/04.

[*1]

Civil Court of the City of New York, Kings County, February 28, 2005

APPEARANCES OF COUNSEL

Israel, Israel & Purdy, LLP (Scott H. Fisher of counsel), for plaintiff. Robert P. Tusa (Josephine M. Celano of counsel), for defendant.

OPINION OF THE COURT

Milagros A. Matos, J.

Facts

Plaintiff medical provider Dr. Jacob Nir, assignee of Josapphat Etienne, instituted this action to recover first-party no-fault benefits from defendant insurer Allstate. Dr. Nir, a neurologist, was denied payment by the insurer for diagnostic testing he performed on the patient/insured Josapphat Etienne. The patient was injured in an automobile accident on January 15, 2004. On February 6, 2004, Dr. Nir examined the patient and conducted electromyography and nerve conduction velocity (EMG/NCV) tests that revealed nerve injury in the patient’s lower back.

At the time the services were rendered, the patient Josapphat Etienne was insured under a no-fault insurance policy issued by defendant Allstate. The no-fault benefits were properly assigned to Dr. Nir, who submitted claim forms to Allstate in the amount of $2,227.71 on February 24, 2004. On April 7, 2004, Allstate made a partial payment to Dr. Nir in the amount of $211.85, leaving a balance of $2,015.86. Defendant denied the remaining claims based upon a peer review report stating that the tests were not medically necessary. Before trial the parties stipulated that the only issue for determination by the court was whether the diagnostic testing was medically necessary as defined by Insurance Law § 5102 (a) (1), and thus whether or not defendant properly denied payment of the claim. The court conducted a full trial of this matter on February 7, 2005.

At trial, both sides presented the testimony of a physician. For defendant, the doctor that had authored the peer review report testified that the diagnostic tests were not medically necessary based on his review of Dr. Nir’s medical reports. The peer review doctor did not examine the patient himself. Even though the diagnostic testing resulted in positive findings of neurological damage to the patient’s lower back, the peer review doctor found that the tests, performed three weeks after the accident, were “medically unnecessary.” Specifically, the peer review doctor testified that not enough time had elapsed from the time of the accident to the time [*2]of the testing, and therefore the testing was premature.

Plaintiff’s expert witness testified that the EMG/NCV testing was medically necessary based on his review of Dr. Nir’s medical report and accredited medical publications. He testified that the patient’s symptoms suggested that there was injury to the nerve. The patient presented complaints of persistent “radiating” pain in the cervical and lower back as well as numbness and tingling. The expert witness concluded that the tests were medically necessary to diagnose radiculopathy, or nerve damage. Finally, plaintiff’s witness testified that the timing of the testing was consistent with the generally accepted medical practices set forth by the American Association of Electrodiagnostic Medicine (AAEM) for both EMG and NCV testing.

Discussion

Although there have been no appellate court rulings on the issue, trial courts have consistently held that the insurer bears both the burden of production and the burden of persuasion with respect to medical necessity of the treatment or testing for which payment is sought. (King’s Med. Supply Inc. v Country-Wide Ins. Co., 5 Misc 3d 767, 771 [Civ Ct, Kings County 2004] [“(i)t is by now firmly established that the burden is on the insurer to prove that the medical services or supplies in question were medically unnecessary”]; Behavioral Diagnostics v Allstate Ins. Co., 3 Misc 3d 246 [Civ Ct, Kings County 2004]; A.B. Med. Servs. v GEICO Ins., 2 Misc 3d 26 [App Term, 2d Dept 2003]; see also Karen B. Rothenberg and Jennifer R. Rapaport, No-Fault: The Litigation Epidemic, NYLJ, Jan. 5, 2004, at 4, col 4.) Therefore, once plaintiff has established its prima facie case, defendant must prove that the treating doctor’s services were not medically necessary. As an element of its proof defendant may use a peer review report, which is a medical professional’s written evaluation of the medical necessity of the services provided. In the summary judgment context, defendant may raise triable issues of fact for lack of medical necessity with a peer review report that “set[s] forth a sufficiently detailed factual basis and medical rationale for the claim’s rejection.” (Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists 2003]; S & M Supply v Kemper Auto & Home Ins. Co., 2 Misc 3d 134[A], 2004 NY Slip Op 50209[U] [App Term, 2d & 11th Jud Dists 2004].) In other words, “to withstand a motion for summary judgment, a peer review report must set forth a factual basis sufficient to establish, prima facie, the absence of medical necessity.” (Choicenet Chiropractic P.C. v Allstate Ins. Co., 2003 NY Slip Op 50672[U], *1 [App Term, 2d & 11th Jud Dists 2003].)

In the trial context, few decisions elucidate on defendant’s burden of proof, or what evidence may be sufficient to establish that the services were medically unnecessary. At a minimum, defendant must establish a factual basis and medical rationale for the lack of medical necessity of plaintiff’s services. (See CityWide Social Work & Psychological Servs. v Travelers Indem. Co., 3 Misc 3d 608 [Civ Ct, Kings County 2004]; Inwood Hill Med. v Allstate Ins. Co., 3 Misc 3d 1110[A], 2004 NY Slip Op 50565[U] [Civ Ct 2004] [at trial, the defense that the claim was not medically necessary “must be supported by sufficient factual evidence or proof and cannot simply be conclusory”].) Therefore, if defendant [*3]provides an insufficient factual basis or medical rationale for its peer review report at trial, the court will afford the peer review report minimal weight, and defendant may fail to sustain its burden of proof.

A peer review report’s medical rationale is insufficient if it is unsupported by or controverted by evidence of medical standards. For example, the medical rationale may be insufficient if not supported by evidence of the “generally accepted medical/professional practice.” (CityWide Social Work & Psychological Servs. v Travelers Indem. Co., 3 Misc 3d 608, 612 [Civ Ct, Kings County 2004].) “Generally accepted practice is that range of practice that the profession will follow in the diagnosis and treatment of patients in light of the standards and values that define its calling.” (CityWide Social Work & Psychological Servs. v Travelers Indem. Co., 3 Misc 3d at 616, supra.) Alternatively, if the plaintiff offers evidence that its medical services were consistent with generally accepted medical practice, the defendant’s peer review report will be afforded less weight and defendant may fail to sustain its burden of proof at trial. (See Elm Med., P.C. v American Home Assur. Co., 2003 NY Slip Op 51357[U], *12 [Civ Ct 2003] [defendant peer review doctor’s conclusion that the electrodiagnostic testing was not “properly documented” did not contradict plaintiff’s testimony of medical necessity and defendant failed to carry its burden].)

A peer review report’s factual basis may be insufficient if it fails to provide specifics of the claim, is conclusory, or otherwise lacks a basis in the facts of the claim. (Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 43 [App Term, 2d & 11th Jud Dists 2004].) For example, a defendant may not establish lack of medical necessity if the only reason for the denial was that the peer review doctor did not have enough information in the claim file upon which a determination could be made. (Park Neurological Servs. P.C. v GEICO Ins., 4 Misc 3d 95 [App Term, 2d Dept 2004].) One court held that a peer review report may be insufficient if the peer review doctor merely reviewed records, rather than examining the insured patient, in preparing the peer review report. (Alliance Med. Off. v Allstate Ins. Co., 196 Misc 2d 268 [Civ Ct, Kings County 2003]; see also Fifth Ave. Pain Control Ctr. v Allstate Ins. Co., 196 Misc 2d 801 [Civ Ct, Queens County 2003].)

In this case, defendant’s doctor recommended denial of plaintiff’s claim because, in his opinion, the diagnostic testing performed by plaintiff Dr. Nir was done prematurely. During testimony the peer review doctor cited only a review of Dr. Nir’s medical reports as the basis for his peer review report. He did not physically examine the patient before writing the peer review report. He cited no medical authority, standard, or generally accepted medical practice as a medical rationale for his findings. Finally, defendant was not able to explain how the tests could be medically unnecessary when the tests did in fact yield positive findings of nerve damage. Such scant factual basis and medical rationale will not sustain defendant’s burden of proof.

Furthermore, defendant’s case was competently rebutted by plaintiff’s expert witness. Defendant could not establish its conclusory medical rationale, that the testing was done [*4]prematurely, in the face of plaintiff’s evidence of the generally accepted medical practice. Plaintiff’s witness testified that the AAEM recommends EMG/NCV testing either “acutely” after or “several weeks” after an accident occurs. On cross-examination, defendant’s peer review doctor agreed that the AAEM is authoritative in the field of electrodiagnostic medicine. The generally accepted medical practice cited by the AAEM was consistent with Dr. Nir’s practice in this case.

Conclusion

Based on the evidence, the court concludes that the testimony and peer review report of defendant’s peer review doctor were insufficient to sustain defendant’s burden of proof on the only issue before this court, lack of medical necessity. Judgment should be entered for the plaintiff in the amount of $2,015.86, plus interest from February 24, 2004 and attorneys’ fees as provided by the insurance regulations, together with the statutory costs and disbursements of this action.