M.V.B. Collision, Inc. v. Allstate Ins. Co.

• Citation: 728 F.Supp.2d 205
• Decision Date: 27 July 2010
• Docket Number: No. 07-CV-0187 (JFB) (MLO),07-CV-0187 (JFB) (MLO)
• Parties: M.V.B. COLLISION, INC., d/b/a Mid Island Collision, Plaintiff, v. ALLSTATE INSURANCE COMPANY, Defendant.
• Court: U.S. District Court — Eastern District of New York

728 F.Supp.2d 205

M.V.B. COLLISION, INC., d/b/a Mid Island Collision, Plaintiff,

v.ALLSTATE INSURANCE COMPANY, Defendant.

No. 07-CV-0187 (JFB) (MLO).

United States District Court,

E.D. New York.

July 27, 2010.

Steven F. Goldstein, Christopher R. Invidiata, and Donald Pupke, Steven F. Goldstein, LLP, Carle Place, NY, for the plaintiff.

Andrew T. Hahn, Sr., Esq., and James S. Yu, Esq., Seyfarth Shaw LLP, New York, NY, for the defendant.

MEMORANDUM AND ORDER

JOSEPH F. BIANCO, District Judge:

Plaintiff M. V.B. Collision, Inc., which does business as "Mid Island Collision" ("plaintiff" or "Mid Island"), brings this diversity case against Allstate Insurance Company ("defendant" or "Allstate"). Mid Island is an auto-body shop. Mid Island and Allstate have had a long-running dispute over the appropriate rate for auto-body repairs. Mid Island alleges that, as a result of this dispute, Allstate agents engaged in deceptive practices designed to dissuade Allstate customers from having their cars repaired at Mid Island and to prevent Mid Island from repairing Allstate customers' cars.

Five motions are currently before the Court. First, Allstate has moved for summary judgment on the pending claims in this case-a claim for tortious interference with business relations and a claim that Allstate's actions violated§ 349 of the New York General Business Law. Second, Allstate has moved to strike certain materials Mid Island submitted in opposition to summary judgment, including portions of Mid Island's Local Rule 56.1 counterstatement and portions of two affidavits. Third, Mid Island seeks to amend the complaint to add a claim for defamation and a claim for prima facie tort. Fourth, Allstate has moved to strike the report of Mid Island's damages expert. Finally, Mid Island has moved to serve an amended expert report.

As set forth below, construing the evidence most favorably to plaintiff, the Court concludes that summary judgment is unwarranted and denies the motion in its entirety. With respect to Mid Island's tortious interference claim, there are triable issues of fact as to whether Allstate interfered with specific potential business relationships and whether Mid Island used "wrongful means" in doing so. Similarly, with respect to the § 349 claim, plaintiff has pointed to evidence that raises genuine issues of material fact as to whether Allstate engaged in a deceptive, consumer-oriented scheme designed to drive customers away from Mid Island. As such, summary judgment is not appropriate on either the tortious interference claim or the § 349 claim. The Court also denies Allstate's motion to strike portions of Mid Island's Local Rule 56.1 counterstatement of material facts and other documents submitted in opposition to summary judgment. The Court has, however, disregarded those portions of Mid Island's submissions not supported by admissible evidence.

With respect to Mid Island's motion to amend the complaint, the Court denies that motion as it relates to the proposed prima facie tort claim because such amendment would be futile. As to the proposed defamation claims, the Court is unable to determine whether such an amendment would be futile as to all such claims due to a lack of specificity as to the allegations. At oral argument, plaintiff's counsel stated that plaintiff would be able to provide more specificity to address the Court's concerns. Accordingly, the motion to amend to add defamation claims is denied without prejudice, and Mid Island may submit a proposed amended complaint that asserts its defamation claims with greater specificity.

With respect to the remaining motions, which seek to strike the report of Mid Island's damages expert and to amend the expert report, the Court reserves decision pending a pre-trial hearing to address those issues.

I. Motion to Strike

Allstate has moved to strike portions of Mid Island's Local Rule 56.1 counterstatement of material fact because certain counterstatements (1) contain no citation to the record; (2) contain legal argument or are conclusory; and/or (3) are baseless objections.

A party moving for summary judgment must file a "short and concise statement ... of the material facts as to which the moving party contends there is no genuine issue to be tried." Local Rule 56.1(a). A party opposing summary judgment must then submit a counterstatement of material facts responding to each assertion that the moving party made. See Local Rule 56.1(b). The assertions in both the moving party's statement and the opposing party's counterstatement must be supported by admissible evidence. See Local Rule 56.1(d). "The purpose of Local Rule 56.1 is to streamline the consideration of summary judgment motions by freeing district courts from the need to hunt through voluminous records without guidance from the parties." Holtz v. Rockefeller & Co., 258 F.3d 62, 74 (2d Cir.2001).

Although many of Mid Island's responses in its counterstatement fail to comply with Local Rule 56.1, "[a] district court has broad discretion to determine whether to overlook a party's failure to comply with local court rules." Holtz, 258 F.3d at 73; see also Gilani v. GNOC Corp., No. 04 Civ. 2935(ILG), 2006 WL 1120602, at *2 (E.D.N.Y. Apr. 26, 2006) (exercising court's discretion to overlook the parties' failure to submit statements pursuant to Local Civil Rule 56.1). Accordingly, in the exercise of its broad discretion, the Court denies Allstate's motion to strike portions of Mid Island's Local Rule 56.1 statement. However, where Mid Island has denied or objected to an assertion by Allstate, the Court only deems that assertion disputed where Mid Island provides admissible evidence to support its denial or objection.

Allstate has also moved to strike specific portions of affidavits of Robert Jesberger, Mid Island's owner, and Brian McGauvran, Mid Island's General Manager. Rule 56(e) of the Federal Rules of Civil Procedure requires that affidavits filed in connection with a summary judgment motion "be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant is competent to testify to the matters stated." Fed. R. Civ. P. 56(e). "A court may ... strike portions of an affidavit that are not based upon the affiant's personal knowledge, contain inadmissible hearsay or make generalized and conclusory statements." Hollander v. Am. Cyanamid Co., 172 F.3d 192, 198 (2d Cir.1999). However, that is not the only option available to the Court when confronted with such an affidavit. In particular, although a court certainly cannot consider inadmissible evidence contained in an affidavit submitted in opposition to a summary judgment motion, the Court is not obligated to engage in the time-consuming, cumbersome process of formally striking such evidence in a line-by-line fashion. See, e.g., Sauerhaft v. Bd. of Educ. of Hastings-on-Hudson Union Free Sch. Dist., No. 05 Civ. 09087(PGG), 2009 WL 1576467, at *8 (S.D.N.Y. June 2, 2009) (" '[N]othing in the rules or the case law requires a court to strike any portion of ... [a Rule 56(e) ] affidavit that is not properly supported.' " (quoting Miller v. Batesville Casket Co., No. 02-Civ.-5612(DLI)(ARL), 2007 WL 2120371, at *6 (E.D.N.Y. July 23, 2007))). Instead, "a court may decline to conduct a line-by-line analysis and ... simply disregard the allegations that are not properly supported." Id. Accordingly, here, the Court has simply disregarded those portions of the Jesberger and McGauvran affidavits that are not based on personal knowledge or that rely on hearsay or otherwise inadmissible evidence.

The Court also rejects Allstate's argument that the Jesberger and McGauvran declarations should be stricken in their entirety because the declarations were not made "under penalty of perjury." Although neither declaration contains the "under penalty of perjury" language, both declarations are notarized and indicate that the declarants were "duly sworn." Cf. Davenport v. Bd. of Trs. of the State Ctr. Cmty. Coll. Dist., 654 F.Supp.2d 1073, 1084 (E.D.Cal.2009) (declining to consider declaration submitted in connection with summary judgment motion where the "declaration was signed, but was not made under penalty of perjury and [the declarant did] not otherwise attest that the contents are true." (emphasis added)). Finally, Allstate argues that McGauvran's declaration should be stricken because it conflicts with his deposition testimony regarding his experience as an auto mechanic. The Court need not resolve this issue, however, because McGauvran's work history is irrelevant to the pending summary judgmentmotion.¹

II. Motion for Summary Judgment

The following facts are taken from the parties' depositions, declarations, exhibits, and respective Local Rule 56.1 statements of facts. Where one party's Local Rule 56.1 statement is cited, the opposing party either does not deny the assertion or does not support its denial or objection with admissible evidence. Upon consideration of a motion for summary judgment, the Court construes the facts in the light most favorable to the non-moving party. See Capobianco v. City of N.Y., 422 F.3d 47, 50 n. 1 (2d Cir.2005). Accordingly, with regard to Allstate's motion for summary judgment, the Court shall construe the facts in favor of Mid Island.

A. Background

1. Overview

a. The Parties

Allstate sells car insurance. ( See Def.'s 56.1 ¶ 12.) Mid Island performs auto body work on cars that have been in accidents. ( Id. ¶ 1.) Mid Island is one of the few auto-body shops in the country where the employees are trained on and use the same tools that the Mercedes Benz company uses in its factories.

b. The Relevant Regulatory Framework

The New York State Insurance Department's Regulation 64 governs the insurers' actions in the auto collision repair process. (Def.'s 56.1 ¶ 24.) When someone's car is involved in an accident and the person makes an insurance claim, the person's insurer may inspect the car. See N.Y. Comp. Codes R. & Regs....