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Law360 (August 14, 2020, 4:14 PM EDT ) A Texas federal judge has rejected Gartner Inc.'s bid to transfer to New York a suit filed by U.S. Specialty Insurance Co. challenging whether the research firm is entitled to additional coverage over its $150 million limit for coronavirus-related event cancellations.
In a brief order issued Thursday, U.S. District Judge Lynn Hughes also denied another motion Gartner had filed with the court that argued Texas courts didn't have authority to hear the dispute. The judge made his decision to keep the case in Texas three days after USSIC urged Judge Hughes to do so in a response where it characterized Gartner's request to move the suit as "procedural gamesmanship."
USSIC filed its lawsuit seeking a declaration about whether Gartner was entitled to the additional coverage on May 27, it told the court, which is nearly a full month before Gartner filed a nearly identical lawsuit in New York federal court on June 25.
Gartner had argued it didn't have sufficient contacts with Texas for it to be fair or reasonable for it to face suit there. The policy at issue, Gartner alleged, was obtained by its New York broker from HCC Specialty Underwriters Inc. in Massachusetts and its premiums were paid to HCC, not USSIC in Texas.
But there was no legitimate reason for Gartner to oppose the Texas litigation, USSIC told the court, and argued that the request was rooted in Gartner's desire to litigate closer to its Stamford, Connecticut, headquarters.
USSIC sued Gartner seeking a declaration that it is not obligated to pay beyond Gartner's $150 million yearly coverage limit. Gartner, which organizes more than 300 conferences annually, had to cancel or postpone its events because of COVID-19.
Gartner subsequently sued USSIC and HCC in New York federal court, arguing the insurer had agreed that Gartner can increase its policies' coverage limit by $170 million for a potential of $340 million, including $20 million for a subsidiary's policy, in 2020.
The parties did not immediately return messages seeking comment Friday.
USSIC is represented by Gerard G. Pecht, Sumera Khan, Todd D. Batson and Daniel McNeel Lane Jr. of Norton Rose Fulbright.
Gartner is represented by Julie A. Hardin of Reed Smith LLP and Steven L. Schreckinger, Scott P. Lewis and Tamara S. Wolfson of Anderson & Kreiger LLP and Nichole S. Soussan.
The case is U.S. Specialty Insurance Co. v. Gartner Group Inc., case number 4:20-cv-01850, in the U.S. District Court for the Southern District of Texas.
--Additional reporting by Daphne Zhang. Editing by Abbie Sarfo.
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