Key Takeaway
New York court imposes $1,000 sanctions on law firms for failing to timely withdraw settled no-fault insurance appeal, highlighting procedural requirements.
This article is part of our ongoing bad faith coverage, with 16 published articles analyzing bad faith issues across New York State. Attorney Jason Tenenbaum brings 24+ years of hands-on experience to this analysis, drawing from his work on more than 1,000 appeals, over 100,000 no-fault cases, and recovery of over $100 million for clients throughout Nassau County, Suffolk County, Queens, Brooklyn, Manhattan, and the Bronx. For personalized legal advice about how these principles apply to your specific situation, contact our Long Island office at (516) 750-0595 for a free consultation.
When Attorneys Fail to Withdraw a Settled Appeal
In no-fault insurance defense litigation, the obligation to notify the court of a settled case extends beyond the trial level. The Appellate Term, Second Department imposed sanctions on both sides’ attorneys for failing to timely withdraw an appeal after the underlying action had been settled — more than six months before the appeal was even scheduled for submission.
Key Takeaway
Both plaintiff's and defendant's counsel have an independent obligation to notify the court when an appeal has been settled. Relying on opposing counsel to file the withdrawal stipulation does not excuse noncompliance, and repeat offenders face higher sanctions.
Case Background: Longevity Med. Supply v American Transit
Longevity Med. Supply, Inc. As Assignee of Osmanli Tamezan v American Tr. Ins. Co., 2015 NY Slip Op 76854(U)(App. Term 2d Dept. 2015)
The Timeline
The procedural history reveals a prolonged failure to notify the court:
- August 15, 2012: Civil Court order entered in Queens County
- October 25, 2012: Both parties attended a CAMP conference
- March 7, 2013: Appellant perfected the appeal
- March 22, 2013: Respondent filed its brief
- On or before July 2, 2014: Underlying action was settled
- January 7, 2015: Appeal was noticed for submission calendar — more than 6 months after settlement
- January 26, 2015: Stipulation Withdrawing Appeal was finally filed
The court discovered that the underlying action had been settled more than six months before the appeal was scheduled for submission, and issued an order to show cause asking why sanctions should not be imposed.
The Court’s Sanctions Order
The Appellate Term imposed sanctions on both sides:
- The Rybak Firm, PLLC (appellant’s counsel): $1,000 to the Lawyers’ Fund for Client Protection
- Netanel Benchaim, Esq. (respondent’s counsel): $250 to the Lawyers’ Fund for Client Protection
Why the Sanctions Differed
The court assessed a higher sanction against appellant’s counsel because:
- The Rybak Firm had repeatedly violated the same rule in prior cases
- The firm submitted no response to the court’s order to show cause
Respondent’s counsel received a lower sanction, but was not absolved. The court held that counsel’s “belief” that appellant’s counsel would file the stipulation of settlement was “inadequate to deflect counsel’s duty under Rule 730.3.”
The Applicable Rule: Appellate Term Rule 730.3(f)
The court cited the governing rule:
“If an appeal or the underlying action or proceeding is wholly or partially settled … the parties or their counsel shall immediately notify the court. Any attorney or party who, without good cause shown, fails to comply with the requirements of this subdivision shall be subject to the imposition of costs and/or sanctions as the court may direct.”
Both sides bear this obligation independently. One attorney cannot simply assume the other will handle it.
Jason’s Analysis
I think everyone should have had to pay $1,000. I just hope counsel for defendant submits an invoice to defendant for the $250 he has to pay and follows up for payment.
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Legal Context
Why This Matters for Your Case
New York law is among the most complex and nuanced in the country, with distinct procedural rules, substantive doctrines, and court systems that differ significantly from other jurisdictions. The Civil Practice Law and Rules (CPLR) governs every stage of civil litigation, from service of process through trial and appeal. The Appellate Division, Appellate Term, and Court of Appeals create a rich and ever-evolving body of case law that practitioners must follow.
Attorney Jason Tenenbaum has practiced across these areas for over 24 years, writing more than 1,000 appellate briefs and publishing over 2,353 legal articles that attorneys and clients rely on for guidance. The analysis in this article reflects real courtroom experience — from motion practice in Civil Court and Supreme Court to oral arguments before the Appellate Division — and a deep understanding of how New York courts actually apply the law in practice.
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Jan 15, 2010Common Questions
Frequently Asked Questions
What constitutes insurance bad faith in New York?
Bad faith occurs when an insurer unreasonably delays, denies, or underpays a valid claim without a legitimate basis. In New York, bad faith in the no-fault context can include failing to timely pay or deny claims, conducting sham IMEs, or using delay tactics to avoid payment. While New York does not have a standalone bad faith statute for first-party claims, remedies include consequential damages and interest.
What remedies are available for insurer bad faith?
In no-fault cases, remedies include 2% per month statutory interest on overdue claims under 11 NYCRR §65-3.9, attorney fees, and potentially consequential damages. In liability insurance contexts, insurers acting in bad faith may be liable for the full judgment against the insured, even exceeding policy limits.
How do I prove bad faith by my insurance company?
You must show the insurer had no reasonable basis for denying or delaying your claim. Evidence includes the insurer's claims file, the timing and adequacy of their investigation, whether they followed their own procedures, and whether the denial was supported by the medical evidence. A pattern of similar conduct toward other claimants can also be relevant.
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About the Author
Jason Tenenbaum, Esq.
Jason Tenenbaum is the founding attorney of the Law Office of Jason Tenenbaum, P.C., headquartered at 326 Walt Whitman Road, Suite C, Huntington Station, New York 11746. With over 24 years of experience since founding the firm in 2002, Jason has written more than 1,000 appeals, handled over 100,000 no-fault insurance cases, and recovered over $100 million for clients across Long Island, Nassau County, Suffolk County, Queens, Brooklyn, Manhattan, the Bronx, and Staten Island. He is one of the few attorneys in the state who both writes his own appellate briefs and tries his own cases.
Jason is admitted to practice in New York, New Jersey, Florida, Texas, Georgia, and Michigan state courts, as well as multiple federal courts. His 2,353+ published legal articles analyzing New York case law, procedural developments, and litigation strategy make him one of the most prolific legal commentators in the state. He earned his Juris Doctor from Syracuse University College of Law.
Disclaimer: This article is published by the Law Office of Jason Tenenbaum, P.C. for informational and educational purposes only. It does not constitute legal advice, and no attorney-client relationship is formed by reading this content. The legal principles discussed may not apply to your specific situation, and the law may have changed since this article was last updated.
New York law varies by jurisdiction — court decisions in one Appellate Division department may not be followed in another, and local court rules in Nassau County Supreme Court differ from those in Suffolk County Supreme Court, Kings County Civil Court, or Queens County Supreme Court. The Appellate Division, Second Department (which covers Long Island, Brooklyn, Queens, and Staten Island) and the Appellate Term (which hears appeals from lower courts) each have distinct procedural requirements and precedents that affect litigation strategy.
If you need legal help with a bad faith matter, contact our office at (516) 750-0595 for a free consultation. We serve clients throughout Long Island (Huntington, Babylon, Islip, Brookhaven, Smithtown, Riverhead, Southampton, East Hampton), Nassau County (Hempstead, Garden City, Mineola, Great Neck, Manhasset, Freeport, Long Beach, Rockville Centre, Valley Stream, Westbury, Hicksville, Massapequa), Suffolk County (Hauppauge, Deer Park, Bay Shore, Central Islip, Patchogue, Brentwood), Queens, Brooklyn, Manhattan, the Bronx, Staten Island, and Westchester County. Prior results do not guarantee a similar outcome.