Understanding Severance in New York No-Fault Insurance Litigation

Understanding Severance in New York No-Fault Insurance Litigation

Severance in no-fault insurance litigation has become increasingly important. Courts are tightening procedural requirements and demanding greater efficiency in case management.

Recent decisions from the Appellate Term, Second Department, show a clear trend toward granting severance motions. This is especially true when cases involve multiple accidents, different assignors, or distinct legal issues.

This analysis of four recent cases reveals how insurance companies use severance motions to break apart complex multi-claim lawsuits. It also explains what medical providers can expect when facing these procedural challenges.

The Practical Reality: Losing Severance Motions

As noted in the original analysis, “I lost five of these recently I think. I stopped keeping track.” This frank admission highlights the challenging landscape medical providers and their attorneys face when defending against severance motions in the Second Department.

The persistence didn’t go unnoticed. After seeking leave to appeal to the Second Department on the last three cases (which was denied), there may have been behind-the-scenes communication that influenced later decisions. However, the legal precedent from these cases remains firm.

Case-by-Case Analysis of Severance Decisions

Case #1: Westchester Radiology & Imaging, P.C. v GEICO Cas. Co.

In Westchester Radiology & Imaging, P.C. v GEICO Cas. Co., 2019 NY Slip Op 51703(U)(App. Term 2d Dept. 2019), the court granted severance based on the fundamental principle that different denial grounds create distinct legal issues:

“The complaint alleges that the claims arose out of six separate accidents which occurred on six different dates and the denial of claim forms indicate that the claims at issue were denied on the ground of lack of medical necessity, an issue which is inherently distinct to each assignor.”

Key Takeaway: Even when multiple claims arise from the same accident type, if they involve different assignors and the denials are based on medical necessity grounds, severance is appropriate because medical necessity determinations are inherently individualized.

Case #2: Premier Surgical Servs., P.C. v GEICO Gen. Ins. Co.

The case Premier Surgical Servs., P.C. v GEICO Gen. Ins. Co., 2019 NY Slip Op 51704(U)(App. Term 2d Dept. 2019), applied the traditional multi-accident analysis:

“The complaint alleges that the claims arose out of four separate accidents which occurred on four different dates. The facts relating to each claim are therefore likely to raise few, if any, common issues of fact.”

Key Takeaway: This represents the most straightforward severance scenario – multiple accidents on different dates create inherently different factual scenarios with minimal overlap.

Case #3: Arcadia Acupuncture, P.C. v Global Liberty Ins. Co. of N.Y.

In Arcadia Acupuncture, P.C. v Global Liberty Ins. Co. of N.Y., 2019 NY Slip Op 51707(U)(App. Term 2d Dept. 2019), the court examined the specific details of the claims:

“A review of the answer, denial of claim forms, and explanations of review pertaining to the claims at issue, reflects that facts relating to each claim are likely to raise few, if any, common issues of fact.”

Key Takeaway: Courts will examine the actual denial letters and EOBs to determine whether claims truly share common factual issues. The specifics of each denial matter significantly.

Case #4: Clarke v Global Liberty Ins. Co. of N.Y.

The case Clarke v Global Liberty Ins. Co. of N.Y., 2019 NY Slip Op 51708(U)(App. Term 2d Dept. 2019), involved two accidents and two assignors:

“The complaint alleges that the claims arose out of two separate accidents which occurred on two different dates… the facts relating to each claim are likely to raise few, if any, common issues of fact.”

Key Takeaway: Even with just two accidents involving two different assignors, severance is appropriate when the claims will require separate proof.

Legal Standards for Severance in No-Fault Cases

New York courts apply several key factors when determining whether to grant severance motions in no-fault insurance litigation:

The “Common Issues of Fact” Test

The central question is whether the claims share sufficient common issues of fact to warrant joint trial. Courts consistently cite Radiology Resource Network, P.C. v Fireman’s Fund Ins. Co., 12 AD3d 185 (2004), for the principle that claims with “few, if any, common issues of fact” should be severed.

Individual vs. Collective Analysis

Courts distinguish between types of claims that benefit from joint proceedings and those that require individual analysis:

Individual Analysis Required:

• Medical necessity determinations
• Different assignors with unique medical histories
• Claims arising from different accidents
• Different treatment providers and protocols

Collective Analysis May Be Appropriate:

• Systematic billing practice challenges
• Uniform policy interpretation issues
• Single accident with multiple providers treating the same patient

Procedural Efficiency Considerations

While courts consider judicial economy, they prioritize fairness and the ability to present focused evidence. Severance often enhances rather than hinders efficiency by:

• Reducing complex multi-party discovery
• Eliminating irrelevant evidence from individual trials
• Allowing more targeted settlement discussions
• Preventing jury confusion from multiple unrelated claims

Strategic Implications for Medical Providers

Understanding when severance motions are likely to be granted allows medical providers and their attorneys to make strategic decisions about case management:

When to Expect Severance Motions

High Probability Scenarios:

• Multiple accidents on different dates
• Different assignors with unrelated medical treatments
• Medical necessity denials for different patients
• Mix of different denial grounds (medical necessity, IME no-shows, EUO no-shows)

Lower Probability Scenarios:

• Single accident with multiple providers treating one patient
• Systematic policy interpretation challenges
• Claims involving identical billing practices or procedures

Case Management Strategies

Voluntary Severance: Consider voluntarily severing claims when severance appears inevitable. This allows you to control the scheduling and prioritize stronger claims.

Discovery Coordination: When severance is granted, coordinate discovery across the severed cases to avoid duplication and reduce costs.

Settlement Strategy: Use severance to your advantage by resolving stronger claims first, which may create pressure for favorable settlements on weaker claims.

Defending Against Severance Motions

While the success rate for opposing severance motions appears low based on recent precedent, there are still viable defenses:

Demonstrating Common Issues

Policy Interpretation: When insurance companies apply the same policy provisions incorrectly across multiple claims, argue that common legal issues predominate over individual factual differences.

Systematic Practices: If the case involves challenges to the insurer’s systematic practices (billing requirements, documentation standards, etc.), argue that joint trial promotes judicial efficiency.

Related Treatments: When multiple providers treated the same patient for related injuries from a single accident, emphasize the interconnected nature of the treatment.

Burden of Proof Arguments

Insurance companies must establish that severance will promote judicial economy without prejudicing any party. Challenge motions by showing:

• Significant overlap in witness testimony
• Common documentary evidence
• Related medical issues or treatments
• Economies of scale in joint discovery

The Economics of Severance

Severance motions create practical economic considerations for medical providers:

Increased Litigation Costs

Multiple Filing Fees: Each severed claim may require separate filing fees and court costs.

Duplicated Discovery: Similar discovery may need to be conducted in each severed case.

Extended Timeline: Multiple cases may extend the overall resolution timeline.

Strategic Advantages

Focused Preparation: Attorneys can focus on the specific issues in each case without distraction from unrelated claims.

Targeted Settlement: Individual cases may settle more readily without the complexity of multiple unrelated claims.

Precedential Value: Success in early severed cases may influence settlement discussions in later cases.

Related No-Fault Litigation Issues

Severance is part of a broader landscape of procedural challenges in no-fault litigation:

• Other procedural challenges in no-fault cases
• IME-related procedural requirements
• EUO compliance and consequences

Frequently Asked Questions About Severance

Can I appeal a severance decision?

Severance orders are generally considered non-final orders that cannot be immediately appealed. However, as noted in the analysis, leave to appeal was sought (and denied) in several cases. The right to appeal typically arises only after final judgment in each severed case.

How does severance affect settlement negotiations?

Severance can both help and hinder settlement discussions. Individual cases may be easier to evaluate and settle, but insurance companies may also use severance to pressure providers into accepting lower settlements on weaker claims while defending stronger ones.

What happens to discovery already conducted when a case is severed?

Discovery conducted before severance typically remains available for use in all severed cases, provided it’s relevant to the specific claims in each case. However, additional case-specific discovery may be necessary.

Can I voluntarily request severance as a plaintiff?

Yes, plaintiffs can request severance when it serves their strategic interests. This might be appropriate when you have some very strong claims mixed with weaker ones, and you want to pursue the strong claims without the distraction of complex multi-claim litigation.

How does severance affect attorney fees and costs?

Attorney fee arrangements should address how fees and costs will be allocated among severed cases. Some agreements may require modification to account for the additional complexity and potential for different outcomes in individual cases.

Looking Forward: Trends in Severance Practice

The trend toward granting severance motions reflects broader themes in New York civil litigation:

Case Management Efficiency

Courts increasingly favor case management approaches that promote focused, efficient resolution of disputes rather than complex multi-party litigation.

Individual vs. Systemic Challenges

The distinction between individual claim challenges and systematic practice challenges has become more pronounced, with courts preferring to address individual issues separately.

Settlement Promotion

Severance may actually promote settlement by making individual cases easier to evaluate and resolve without the complexity of unrelated claims.

The Importance of Experienced No-Fault Litigation Counsel

Navigating severance issues requires a solid understanding of both procedural rules and strategy. The cases analyzed here show that even experienced practitioners can face unexpected procedural challenges. These challenges can significantly impact case management and outcomes.

At the Law Office of Jason Tenenbaum, we understand the complex procedural landscape of New York no-fault insurance litigation. Our experience with severance motions, case management strategies, and the broader context of no-fault law allows us to provide effective representation whether you’re facing severance motions or considering requesting them strategically.

The candid assessment that “Amica is a good insurance company; they deserve better” reflects our commitment to honest analysis and effective advocacy. We understand that no-fault litigation involves complex interactions between good-faith parties, and our goal is always to achieve fair resolutions efficiently.

Whether you’re a medical provider facing severance motions or need strategic advice about case management in no-fault litigation, our experienced team can help you navigate these challenges effectively. Call 516-750-0595 for a free consultation. We’re ready to provide the sophisticated legal analysis and strategic thinking necessary to protect your interests in New York’s complex no-fault insurance system.