STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v. LIFELINE MEDICAL IMAGING (2025)

Order, Supreme Court, Bronx County (Wilma Guzman, J.), entered July 24, 2023, which granted the motion of plaintiffs State Farm Mutual Automobile Insurance Company, State Farm Indemnity Company, State Farm Guaranty Insurance Company, and State Farm Fire and Casualty Company (collectively State Farm) for summary judgment declaring that State Farm had no obligation to pay bills submitted by defendant Lifeline Medical Imaging, P.C., unanimously reversed, on the law, without costs, the motion denied, and the declaration vacated.

In this action, State Farm sought a declaration that it was not obligated to provide no-fault coverage for various claims submitted by Lifeline, a medical provider.  According to State Farm, Lifeline failed to meet a condition precedent to coverage by failing to appear for duly scheduled examinations under oath (EUOs) and by refusing to produce an individual who could provide the information needed to verify Lifeline's claims.  As a result, State Farm maintains, Lifeline's claim to no-fault benefits is foreclosed.

Supreme Court should have denied the motion as premature, as State Farm failed to offer Lifeline an objective justification for requesting the EUOs, as required by the governing no-fault regulations (see Country–Wide Ins. Co. v. Alicea, 214 A.D.3d 530, 531, 183 N.Y.S.3d 848 [1st Dept. 2023];  Country–Wide Ins. Co. v. Delacruz, 205 A.D.3d 473, 473, 168 N.Y.S.3d 63 [1st Dept. 2022]).  The criteria by which State Farm decided that an EUO was required is essential for Lifeline to oppose State Farm's summary judgment motion, and those criteria are exclusively within the State Farm's knowledge and control (see Delacruz, 205 A.D.3d at 473, 168 N.Y.S.3d 63, citing 11 NYCRR 65–3.5[e]).  In addition, despite State Farm's assertion otherwise, it did not fully respond to Lifeline's discovery request for a copy of the objective standards relied upon when the EUO was scheduled (see Kemper Independence Ins. Co. v. AB Med. Supply, Inc., 187 A.D.3d 671, 671, 131 N.Y.S.3d 556 [1st Dept. 2020];  American Tr. Ins. Co. v. Jaga Med. Servs., P.C., 128 A.D.3d 441, 441, 6 N.Y.S.3d 480 [1st Dept. 2015];  see also Ops Gen Counsel N.Y. Ins Dept No. 02–10–14 [October 2002];  Ops Gen Counsel N.Y. Ins Dept No. 06–12–16 [December 2006]).

Because State Farm's rationale for requesting the EUOs has yet to be determined, the issue of whether State Farm's no-coverage defense is subject to preclusion cannot yet be determined.