FILED: NEW YORK COUNTY CLERK 09/25/2020 05:26 PM
`NYSCEF DOC. NO. 2
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`INDEX NO. 654742/2020
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`RECEIVED NYSCEF: 09/25/2020
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`Index No. ______________
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` COMPLAINT
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`SUPREME COURT OF THE STATE OF NEW YORK
`COUNTY OF NEW YORK
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`AGP HOLDINGS TWO LLC; AGP HOLDINGS THREE
`LLC; and AGP HOLDINGS ONE LLC,
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`Plaintiffs,
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`- against -
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`CERTAIN UNDERWRITERS AT LLOYD’S OF
`LONDON INCLUDING SYNDICATE NOS. 4000, 5000,
`2121, 2987, 4020, 1861, 1221, 1183, 4711, 5151, 1686,
`and 4472 AT LLOYD’S, LONDON AND THEIR
`UNDERWRITING MEMBERS; GREAT LAKES
`INSURANCE SE; SWISS RE INTERNATIONAL SE;
`AIG PROPERTY CASUALTY COMPANY; and
`FEDERAL INSURANCE COMPANY,
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`Defendants.
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`AGP Holdings Two LLC, AGP Holdings Three LLC, and AGP Holdings One LLC
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`(collectively referred to hereafter as “Plaintiffs”), by their undersigned counsel, and for their
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`Complaint against Certain Underwriters at Lloyd’s of London, including Syndicate Nos. 4000,
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`5000, 2121, 2987, 4020, 1861, 1221, 1183, 4711, 5151, 1686, and 4472 at Lloyd’s, London and
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`their underwriting members; Great Lakes Insurance SE; Swiss Re International SE; AIG
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`Property Casualty Company; and Federal Insurance Company (collectively referred to hereafter
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`as “Insurers”), allege:
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`NATURE OF THE ACTION
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`1.
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`Plaintiffs bring this action against Insurers, who issued to Plaintiffs and their co-
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`insureds all risks property insurance policies covering certain categories of items for the policy
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`period May 1, 2018 to May 1, 2019 (each a “Policy” and together, the “Policies”). Insurers have
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`FILED: NEW YORK COUNTY CLERK 09/25/2020 05:26 PM
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`INDEX NO. 654742/2020
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`RECEIVED NYSCEF: 09/25/2020
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`failed to honor Plaintiffs’ claim for coverage for loss or damage to certain of the items insured
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`under the Policies. By this action, Plaintiffs seek to enforce the terms of the Policies.
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`2.
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`Prior to the events giving rise to this Complaint, some of the items insured under
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`the Policies (the “Items”) were maintained at a private residence in New York State (“the
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`Residence”). In the fall of 2018, a fire broke out at the Residence (the “Fire”), resulting in
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`substantial damage to the structure of the Residence where certain of the Items were housed.
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`The Fire, including the efforts to contain and extinguish the Fire and the removal of Items from
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`the Residence, caused loss or damage to certain Items that were housed there.
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`3.
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`The Items are valuable articles insured under the Policies. The Policies either
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`include or incorporate by reference a detailed schedule of specific items covered under the
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`Policies (the “Schedule”), which includes an insured value for each of the items insured. After
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`the Fire, Plaintiffs and their co-insureds provided notice and tendered a claim for coverage under
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`the Policies for the loss or damage to various Items insured under the Policies.
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`4.
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`Although certain Insurers have made payment to Plaintiffs and their co-insureds
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`under their Policy for losses associated with certain Items, all Insurers have failed to pay
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`Plaintiffs the full amounts owed under their respective Policies for all Items as to which there
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`was loss or damage. In particular, Insurers have failed to acknowledge that certain of the Items
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`at the Residence during the Fire have suffered physical loss or damage from the Fire and its
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`aftermath.
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`5.
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`Insurers should be required to fulfill their obligations under the Policies to provide
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`coverage for all of the loss or damage to Items resulting from the Fire and its aftermath.
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`Plaintiffs seek compensatory damages, declaratory relief, prejudgment interest, and such further
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`and additional relief that may be available.
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`FILED: NEW YORK COUNTY CLERK 09/25/2020 05:26 PM
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`INDEX NO. 654742/2020
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`PARTIES
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`6.
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`Plaintiff AGP Holdings Two LLC is a Delaware limited liability company with its
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`principal office location in New York, New York.
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`7.
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`Plaintiff AGP Holdings Three LLC is a Delaware limited liability company with
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`its principal office location in New York, New York.
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`8.
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`Plaintiff AGP Holdings One LLC is a Delaware limited liability company with its
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`principal office location in New York, New York.
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`9.
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`Defendants Certain Underwriters at Lloyd’s of London including Syndicate Nos.
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`4000, 5000, 2121, 2987, 4020, 1861, 1221, 1183, 4711, 5151, 1686, and 4472 at Lloyd’s,
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`London and their underwriting members (collectively “Lloyd’s Underwriters”) are underwriting
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`syndicates and their underwriting members at Lloyd’s, London. Upon information and belief,
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`the syndicates comprising the Lloyd’s Underwriters are unincorporated associations that sell
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`insurance through the Lloyd’s of London insurance market located in the United Kingdom. In
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`the Policy that the Lloyd’s Underwriters subscribed to and issued to Plaintiffs, the Lloyd’s
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`Underwriters agreed to submit to the jurisdiction of this Court and appointed and authorized the
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`law firm of Mendes & Mount, located at 750 Seventh Avenue, New York, New York 10019, to
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`accept service on their behalf in connection with any suit arising under their Policy. At all times
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`relevant to this Complaint, Lloyd’s Underwriters were engaged in the business of selling
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`contracts of insurance and doing business in New York. For the avoidance of doubt, Lloyd’s
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`Underwriters sued herein encompass any and all underwriters operating in and through the
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`Lloyd’s of London marketplace who subscribed to the Policy issued to Plaintiffs and their co-
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`insureds bearing policy number B1161K18E4341.
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`10.
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`Defendant Great Lakes Insurance SE (“Great Lakes”) is an insurance company
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`that is, on information and belief, organized under the laws of Germany with its principal place
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`of business in Germany. In the Policy that Great Lakes subscribed to and issued to Plaintiffs and
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`their co-insureds, Great Lakes agreed to submit to the jurisdiction of this Court and appointed
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`and authorized the law firm of Mendes & Mount, located at 750 Seventh Avenue, New York,
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`New York 10019, to accept service on its behalf in connection with any suit arising under the
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`Policy. At all times relevant to this Complaint, Great Lakes was engaged in the business of
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`selling contracts of insurance and doing business in New York.
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`11.
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`Defendant Swiss Re International SE (“Swiss Re”) is an insurance company that
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`is, on information and belief, organized under the laws of Luxembourg with its principal place of
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`business in Luxembourg. In the Policy that Swiss Re subscribed to and issued to Plaintiffs and
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`their co-insureds, Swiss Re agreed to submit to the jurisdiction of this Court and appointed and
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`authorized the law firm of Mendes & Mount, located at 750 Seventh Avenue, New York, New
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`York 10019, to accept service on its behalf in connection with any suit arising under the Policy.
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`At all times relevant to this Complaint, Swiss Re was engaged in the business of selling contracts
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`of insurance and doing business in New York.
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`12.
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`Defendant AIG Property Casualty Company (“AIG”) is an insurance company
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`organized under the laws of Illinois with its principal place of business in New York, New York.
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`AIG is licensed to do business in New York and, at all times relevant to this Complaint, was
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`engaged in the business of selling contracts of insurance and doing business in New York.
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`13.
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`Defendant Federal Insurance Company (“Federal”) is an insurance company
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`organized under the laws of Indiana with its principal place of business in New Jersey. Federal
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`FILED: NEW YORK COUNTY CLERK 09/25/2020 05:26 PM
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`is licensed to do business in New York and, at all times relevant to this Complaint, was engaged
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`in the business of selling contracts of insurance and doing business in New York.
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`JURISDICTION AND VENUE
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`14.
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`This Court has jurisdiction pursuant to CPLR 301, CPLR 302, CPLR 3001, and
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`BCL 1314. Without limiting the foregoing, all Insurers have in their Policies agreed to submit to
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`the jurisdiction of this Court.
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`15.
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`Venue is proper in this Court pursuant to CPLR 503.
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`16.
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`The Policies are governed by New York law because the Policies specifically so
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`provide.
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`FACTUAL BACKGROUND
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`The 2018 Fire and Damage to Items
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`17.
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`In the fall of 2018, the Residence experienced the Fire.
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`18.
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`Certain of the Items in the Residence, including those at issue in this Complaint,
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`were damaged as a result of the Fire, in particular from exposure to extreme heat, smoke, soot,
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`moisture, water (including falling water and water under pressure), chemical and water vapors,
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`elevated relative humidity, rough handling (including from moving the Items away from the Fire
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`to prevent further damage), and rapid environmental fluctuations and temperature changes
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`(including from moving the Items outside of the Residence).
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`19.
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`The Items owned by Plaintiffs suffering physical loss or damage as a result of the
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`Fire and that are insured by the Policies and for which recovery is sought in this Complaint
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`include the four Items specifically identified to the Insurers in Partial Proofs of Loss Nos. 8, 9,
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`10, and 11 and related written communications dated on or about August 17, August 24,
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`September 17, September 23, and September 24, 2020, which confirm and particularize the loss
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`or damage sustained by these Items as a result of the Fire.
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`20.
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`There is one Item in addition to those described in paragraph 19, above, that was
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`in the Residence at the time of the Fire, that is insured under the Policies, and that was among the
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`Items addressed in correspondence to Insurers or their adjuster dated March 10 and March 15,
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`2020, and as to which Plaintiffs fully reserve rights to seek recovery from Insurers. By
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`correspondence to the Insurers, Plaintiffs identified that Item to Insurers and indicated that
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`evaluation and consideration of that Item are ongoing.
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`The Insurance Policies
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`21.
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`Plaintiffs and their co-insureds purchased and maintained multiple layers of all
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`risk property insurance for Items housed at the Residence at the time of the Fire.
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`22.
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`The Lloyd’s Underwriters, Great Lakes, and Swiss Re issued and subscribed to
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`the Policy bearing policy number B1161K18E4341 (“the London Policy”), which is a primary-
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`layer policy and is subject to policy limits, as applicable. The London-based broker involved in
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`the placement of the London Policy was RK Harrison trading as Howden UK Group Limited.
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`23.
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`AIG issued to Plaintiffs and their co-insureds a first-layer excess policy bearing
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`policy number PCG 0004437044 (the “AIG Policy”), which is subject to policy limits, as
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`applicable, and sits excess of the London Policy.
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`24.
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`Federal issued to Plaintiffs and their co-insureds a second-layer excess policy
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`bearing policy number (19) 5538-36-35 (the “Federal Policy”), which is subject to policy limits,
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`as applicable, and sits excess of the London Policy and the AIG Policy.
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`25.
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`The AIG Policy and the Federal Policy are known as following-form policies and
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`provide all risks property insurance coverage for fire and other risks consistent with the coverage
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`provided by the London Policy.
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`26.
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`The policy period for all three Policies is May 1, 2018 to May 1, 2019. The Fire
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`occurred during the policy period of the Policies.
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`27.
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`Plaintiffs and their co-insureds paid all premiums due for the Policies.
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`28.
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`The London Policy “insures against all risks of physical loss or physical damage
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`for losses occurring during the period . . .” and includes further particulars. The AIG and Federal
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`Policies provide the same measure of coverage.
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`29.
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`The Policies incorporate a schedule of items insured under the Policies (referred
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`to above and hereafter as the “Schedule”). The Schedule includes an inventory number and lists
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`a “scheduled value” or “insured value” for each item listed. The Schedule, including the
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`scheduled or insured values of the Items discussed in paragraphs 19 and 20, above, was agreed to
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`by Insurers and incorporated into the Policies.
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`30.
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`The “Basis of Valuation” section of the London Policy provides that if a
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`scheduled “item is partly damaged, the Insured may decide whether Insurers repair, replace or
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`pay” the scheduled value of the item. That provision is incorporated into the AIG and Federal
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`Policies.
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`The Insurers’ Wrongful Refusal to Acknowledge Coverage or Pay the Amounts Owed
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`31.
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`Plaintiffs and their co-insureds provided notice to the Insurers of the Fire
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`immediately after it occurred. Plaintiffs and their co-insureds further provided notice to the
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`Insurers of damage to Items involved in the Fire shortly after the Fire. The mutually agreed
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`adjuster pursuant to and designated under the Policies, employed by the firm G.J. Smith and
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`Associates, has been engaged since shortly after the Fire. Plaintiffs and their co-insureds have
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`periodically updated the adjuster and the Insurers and submitted eleven (11) proofs of loss
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`detailing damage to the Items and seeking payment under the Policies for the damaged items.
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`32.
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`All premiums due under the Policies and all other pertinent terms and conditions
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`under the Policies have been satisfied by those insured under the Policies or compliance has been
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`excused, waived, discharged, or otherwise does not bar coverage for Plaintiffs’ claim for loss
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`resulting from the Fire. The Policies have been in full force and effect at all pertinent times.
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`33.
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`To date, Lloyd’s Underwriters, Great Lakes, and Swiss Re have partially paid
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`Plaintiffs or their co-insureds under the London Policy for items not identified in paragraphs 19
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`and 20, above. Insurers have failed to pay Plaintiffs under their Policies for, or to acknowledge
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`their coverage responsibilities with respect to, any of the Items that have suffered physical loss or
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`damage that are the subject of paragraph 19, above. The amounts owed by Insurers under the
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`Policies with respect to these Items is sufficient to exhaust the remaining limits of the London
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`Policy and the limits of the AIG Policy and to impair substantially the limits of the Federal
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`Policy.
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`34.
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`Insurers’ refusal to acknowledge their obligations or to pay Plaintiffs under their
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`Policies for the value of all of the Items as to which there has been loss or damage is a breach of
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`their obligations under the Policies.
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`FIRST CLAIM FOR RELIEF
`(Breach of Contract Against All Defendants)
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`Plaintiffs repeat and reallege the allegations of paragraphs 1 through 34 of the
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`35.
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`Complaint as if fully set forth herein.
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`36.
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`Physical loss or damage to the insured Items as a result of the Fire, including its
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`aftermath, constitutes covered loss under the Policies, including to those Items identified in
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`paragraph 19, above, as to which Plaintiffs have received no claim payments from the Insurers
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`under any of the Policies.
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`37.
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`Subject only to the applicable upper and underlying policy limits of the London
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`Policy, the AIG Policy, and the Federal Policy, respectively, Plaintiffs are entitled to recover in
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`full from the Insurers up to the amount of the scheduled values of each Item described in
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`paragraph 19, above. Plaintiffs are further entitled to recover all of their claim preparation fees,
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`costs, and expenses incurred in establishing the existence or amount of the losses covered by the
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`Policies, as well as certain mitigation-related and other expenses as and to the full extent set forth
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`in the Policies.
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`38.
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`Each Insurer has failed to, and continues to fail to, provide coverage in full for
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`Items damaged in the Fire under its respective Policy. Such refusals and failures constitute
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`material breaches of such contracts of insurance.
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`39.
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`Those material breaches by Insurers have proximately caused Plaintiffs harm, for
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`which Plaintiffs are entitled to damages in an amount to be determined in this action, plus
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`prejudgment interest and other amounts to be awarded by the Court.
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`SECOND CLAIM FOR RELIEF
`(Declaratory Judgment Against All Defendants)
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`40.
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`Plaintiffs repeat and reallege the allegations of paragraphs 1 through 39 of the
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`Complaint as if fully set forth herein.
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`41.
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`Each of the Insurers has failed to acknowledge and perform, and will continue to
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`fail to acknowledge and perform, its obligations to provide coverage and to pay up to its
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`applicable policy limits for the losses associated with various Items that suffered loss or damage
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`or may have suffered loss or damage as a result of the Fire, including with respect to all Items
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`identified in paragraphs 19 and 20, above, and any additional Items as to which loss or damage
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`resulting from the Fire is confirmed.
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`42.
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`An actual and justiciable controversy exists between Plaintiffs and Insurers
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`concerning Insurers’ contractual obligations to provide coverage to Plaintiffs for and to pay up to
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`their applicable policy limits for all of the losses and expenses associated with all Items that
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`suffered loss or damage or may have suffered loss or damage as a result of the Fire.
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`43.
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`Pursuant to CPLR 3001, Plaintiffs request that the Court issue a judicial
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`determination and declaration as to Insurers’ respective rights and obligations under the Policies
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`with respect to all losses and expenses Plaintiffs have suffered or incurred to date, and any losses
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`or expenses they will suffer or incur in the future, as a result of loss or damage to Items as a
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`result of the Fire and its aftermath.
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`WHEREFORE, Plaintiffs seek judgment as follows:
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`A.
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`awarding Plaintiffs damages in an amount to be determined in this action;
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`B.
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`awarding Plaintiffs prejudgment interest at the maximum legal rate, in
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`accordance with CPLR 5001;
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`C.
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`declaring that Insurers are liable for Plaintiffs’ losses and expenses arising from
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`the Fire;
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`D.
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`awarding Plaintiffs attorneys’ fees, costs, and disbursements incurred in
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`obtaining the benefits due under the Policies;
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`E.
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`granting Plaintiffs such other and further relief as the Court may deem just
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`and proper.
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`FILED: NEW YORK COUNTY CLERK 09/25/2020 05:26 PM
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`INDEX NO. 654742/2020
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`Dated: New York, New York
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`September 25, 2020
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`COVINGTON & BURLING LLP
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`/s/ C. William Phillips .
`By
`C. William Phillips
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` Russell M. Squire
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`The New York Times Building
`620 Eighth Avenue
`New York, NY 10018
`(212) 841-1000
`rsquire@cov.com
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`Counsel for Plaintiffs AGP Holdings Two LLC,
`AGP Holdings Three LLC, and AGP Holdings One
`LLC
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`OF COUNSEL:
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`Mitchell F. Dolin (not admitted in New York)
`COVINGTON & BURLING LLP
`One CityCenter
`850 Tenth Street, NW
`Washington, DC 20001
`(202) 662-6000
`mdolin@cov.com
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`Christine Haskett (not admitted in New York)
`COVINGTON & BURLING LLP
`Salesforce Tower
`415 Mission Street, Suite 5400
`San Francisco, CA 94105
`(415) 591-6000
`chaskett@cov.com
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