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LI federal judge sues Allstate over fire that destroyed his Setauket home

Fire rages through the Setauket home of U.S.

Fire rages through the Setauket home of U.S. District Judge Gary Brown in April 2019. Credit: Kim Buncke

A Long Island federal judge named to the bench after exposing the denial of payouts to homeowners from insurance companies following superstorm Sandy, has sued Allstate for stalling on his claim about an electrical fire that destroyed his home.

U.S. District Judge Gary Brown, who sits in Central Islip federal court, filed suit against the insurance company and its home rental contractor to stop their eviction efforts against him and his wife from a temporary home and the removal of rented furniture.

Allstate, whose policy covers a client’s interim rental accommodations, is acting despite a government policy barring evictions during the coronavirus crisis, Brown said in the lawsuit filed Tuesday in Central Islip federal court.

Because of a conflict of interest, the chief judge of the Eastern District asked the Second Circuit to appoint a judge from outside the district to hear the case, according to court papers.

In his suit, which also seeks several hundred thousand dollars in damages, Brown alleges the issue began when his Setauket home burned down in April of 2019. 

Brown alleges that the insurance company continually stalled his attempts to get the claim resolved. After his paperwork had been destroyed in the fire, Allstate took several months to send Brown a copy of his policy so he could determine his entitled reimbursements, the suit alleges.

Further, the lawsuit says, stalling included Allstate initially maintaining his house could be rebuilt, despite the Town of Brookhaven condemning the property, and an engineer Brown hired finding damage so severe the building could not be saved.

In addition, Brown alleges, because of the delays, an Allstate representative told him the business would cover his rental costs beyond the standard one-year required by the policy. Now, Brown says, the company is denying that would be the case.

Jaclyn Pogoloff, a spokesman for Allstate, declined to comment on the case citing pending litigation but released a statement Friday.

"Allstate handled the claim appropriately and in accordance with the customer's insurance policy.  Allstate has never taken steps to evict the customer or force him from the temporary housing, nor does it have intentions to do so in the future.  We covered the customer's temporary housing and living expenses for 12 months, which is the maximum payout for this policy."

In nominating Brown for his judgeship, Sen. Chuck Schumer (D-N.Y.) wrote that when he was a federal magistrate, Brown found in a ruling that “it appears that engineers falsified reports to avoid paying homeowners."

Schumer also quoted Brown's order where the then-magistrate wrote: "…evidence suggests that these unprincipled practices may be widespread."

There were more than 1,000 lawsuits filed by homeowners affected by Sandy.

In the lawsuit, Brown also said he filed a complaint about Allstate’s conduct with the New York State Department of Financial Services, which regulates the insurance industry.

According to Brown’s lawsuit, on April 1, the insurance company replied to the financial services department and “in an effort to deflect blame for [its] failings, falsely asserted that ‘[p]rior to the recent health emergency, [the Browns] made little progress toward rebuilding the insured premises.”

When asked if he thought Allstate was retaliating against Judge Brown because of his ruling on the Sandy case, Brown’s attorney, John McEntee, declined to comment.

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