Kim v Radiology Assoc. of Main St., P.C.

Supreme Court, Queens County

Decided on July 10, 2026

Index No. 715347/2025

Marguerite A. Grays, J.

The following papers numbered EF 3-14 read on this motion by defendant RADIOLOGY ASSOCIATES OF MAIN STREET, P.C. for an Order pursuant to CPLR Rule 3211(a)(1), (5) and (7) seeking dismissal of the Complaint of plaintiff ALICE M. KIM, M.D.

Papers Numbered

Notice of Motion - Affirmation and Exhibit EF 3, 5-6

Memorandum of Law EF 4

Stipulation Adjourning Motion EF 9

Affirmation in Opposition, Exhibits EF 10-12

Memorandum of Law in Opposition EF 13

Memorandum of Law in Reply EF 14

Upon the foregoing papers it is ordered that this motion by plaintiff is determined as [*2]follows:

Plaintiff Alice M. Kim, M.D. commenced the above-entitled action against defendant Radiology Associates of Main Street, P.C. (RAMS), her former employer, and John Doe 1 through 3 to recover a cash distribution made to defendant as policy administrator of a medical malpractice insurance policy obtained from Medical Liability Mutual Insurance Co. (MLMIC) on behalf of plaintiff. MLMIC, at one time the largest medical malpractice insurer in New York State, converted from a mutual insurance company to a stock insurance company in furtherance of its acquisition by National Indemnity Co. (NICO), a subsidiary of Berkshire Hathaway. Plaintiff, as an "eligible policyholder," was entitled under the terms of MLMIC's Conversion Plan to a cash consideration equal to her membership interests pursuant to New York Insurance Law § 7307. Said amount was calculated as $335,319.62.

Plaintiff alleges that the defendant has failed and refused to forward the proceeds which it received as policy administrator to plaintiff as it claims entitlement to said proceeds based upon plaintiff's execution of the consent form forwarded by MLMIC as required for its demutualization. Defendant argues that plaintiff assigned her ownership interests in said proceeds to defendant via said consent form. Plaintiff, however, contends that the sole purpose of the consent was to appoint defendant as her agent for purposes of receiving the proceeds as defendant did not have authority to do so without this designation. Plaintiff by her action denies that any interest was assigned, transferred or conveyed to defendant and seeks return of the funds. Her Complaint alleges causes of action sounding in conversion, unjust enrichment, and money had and received as well as two separate claims of breach of fiduciary duty, one seeking damages and the other, rescission.

There is no dispute that plaintiff was an "eligible policyholder" for purposes of the demutualization. Moreover, as the policy administrator prior to the demutualization, defendant received both the Consent form and the Notice of Important Information for Policyholders on behalf of plaintiff prior to disbursement. Plaintiff alleges that defendant failed to forward the Notice to her and claims that she was directed by defendant to execute the consent. Defendant has moved pre-Answer to dismiss the Complaint in its entirety on grounds that the consent executed by plaintiff assigned her ownership interest in the funds to defendant and, therefore, constitutes documentary evidence which utterly refutes plaintiff's action. Additionally, defendant contends that none of the claims asserted by plaintiff state a cause of action for which relief can be granted and, even if they did, all are barred by the statute of limitations.

DISCUSSION

Plaintiff is a medical doctor who was employed by RAMS, a radiology group based in Flushing, Queens, from July 2010 through July 2018. During that time, and as part of her employment with defendant, RAMS obtained and paid premiums relating to her medical malpractice insurance. As such, there is no dispute that plaintiff was an "eligible policyholder" insured by MLMIC during the time Berkshire Hathaway was considering the acquisition of [*3]MLMIC by NICO. To this end, a Plan of Conversion and an Acquisition Agreement were prepared for approval and, pursuant to Insurance Law § 7307, MLMIC was required by the New York State Superintendent of Financial Services to forward Notice and Consent forms regarding demutualization and acquisition to all eligible policyholders, including plaintiff.

The Notice sent to defendant as plaintiff's policy administrator explained that the policy administrator designations on file with MLMIC did not extend to the distribution of cash amounts allocated to eligible policyholders pursuant to MLMIC's demutualization. Thus, "[i]n order for cash amounts to be distributed to policy administrators, eligible policyholders must appoint their policy administrators to receive such distributions" (defendant's exhibit A). The Notice, which was never forwarded by defendant to plaintiff, clearly states that "[this] policyholder information statement . . . sets forth a process for policy administrators to file an objection with MLMIC to distributions being made directly to eligible policyholders if a policy administrator believes that it has a legal right to receive the cash amount allocated to the eligible policyholders. In the event of a dispute, the cash amounts in dispute will be held in escrow until the dispute is resolved " (id.) (emphasis added).

The Consent, which was forwarded to plaintiff by defendant, states that "the undersigned hereby irrevocably supplements the policy administrator appointment previously executed by the undersigned to provide that, in addition to the previously designated responsibilities of the policy administrator, the undersigned hereby designates the undersigned's policy administrator as agent to receive any distribution that may be allocated to the undersigned" arising from MLMIC's demutualization (defendant's exhibit A). It is plaintiff's contention that, based upon the Consent and Notice, she did not transfer or waive any of her rights to the cash distribution but merely permitted defendant to receive said distribution as her agent as a matter of convenience. Moreover, as no evidence has been offered by defendant that it filed any objection based upon its belief that it had a legal right to receive the cash distribution as opposed to plaintiff, defendant cannot now argue that plaintiff assigned or waived her share of the demutualization proceeds merely by executing the consent form.

As the largest medical malpractice insurer in New York State, MLMIC's demutualization spawned numerous law suits presenting the same issue to the courts, namely, who was entitled to the cash consideration arising from the demutualization, the health care providers themselves or their employers who had paid the medical malpractice insurance premiums. On a consolidated appeal of eight cases, the Court of Appeals held that, "when an employer pays premiums to a mutual insurance company to obtain a policy of which its employee is the policyholder, and the insurance company demutualizes, absent contrary terms in the contract of employment, insurance policy, or separate agreement, the policyholder is entitled to the proceeds from the demutualization" (Columbia Memorial Hospital v. Hinds, 38 NY3d 253, 276-277 [2022]).

Defendant misapplies the Court of Appeals holding in Columbia Memorial Hospital and, ignoring the Court's recognition of plaintiff as the rightful receiver of the demutualization proceeds, argues that the Consent executed by plaintiff constitutes a "separate contract" which [*4]acts to assign plaintiff's ownership interest in the demutualization proceeds to defendant. This argument fails, however, as the Consent form is not a separate agreement as between plaintiff and defendant as contemplated by the Court of Appeals but is, rather, a document forwarded by MLMIC to plaintiff to effectuate the demutualization pursuant to Insurance Law §7307.

Defendant moves pre-Answer pursuant to CPLR §3211(a) to dismiss the five causes of action asserted by plaintiff as against defendant. Defendant claims that the consent, in addition to constituting a contrary agreement within the meaning of the Court of Appeals ruling in Columbia Memorial Hospital, utterly refutes plaintiff's position that she is entitled to the demutualization proceeds, thus warranting dismissal pursuant to CPLR §3211(a)(1). Defendant argues that all of plaintiff's causes of actions are barred by the statute of limitations pursuant to CPLR §3211(a)(5). Finally, defendant claims dismissal of plaintiff's action is warranted as she fails to state any cognizable cause of action. See CPLR §3211(a)(7).

Dismissal Pursuant to CPLR Rule 3211(a)(1)

A motion pursuant to CPLR §3211(a)(1) may only be granted where the documentary evidence utterly refutes plaintiff's factual allegations so as to conclusively establish a defense as a matter of law. (Goshen v. Mutual Life Insurance Co. of New York, 98 NY2d 314, 326 [2002]). Defendant argues that the Consent form is dispositive documentary evidence that conclusively establishes defendant's right to retain the disputed proceeds. However, "[i]n order for evidence submitted under a CPLR §3211(a)(1) motion to qualify as 'documentary evidence,' it must be 'unambiguous, authentic, and undeniable' " (Cives Corp. v. George A. Fuller Co., Inc. 97 AD3d 713, 714 [2012] quoting Granada Condominium III Assn. v. Palomino, 78 AD3d 996, 996-997 [2010]). Contrary to defendant's assertion, the terms of the Consent form do not evidence an unambiguous and complete relinquishment by plaintiff of all possessory rights and interest in the disbursement amount.

The terms of the Consent clearly establish that its purpose is to grant authority to the previously appointed policy administrator so that the policy administrator may "receive any distribution that may be allocated to the undersigned upon the consummation of the announced proposed conversion" (defendant's exhibit A). Furthermore, the Consent also states that by signing same, the policyholder "supplements the policy administrator appointment previously executed by the undersigned" (id.). This evidences that the nature of the appointment is the same in that the policy administrator is further acting as agent on behalf of the policyholder. Thus, plaintiff's claim that she is entitled to the cash distribution over and above defendant is not refuted by the Consent.

By way of contrast, plaintiff submits in opposition an Assignment Agreement executed by John Riggs, M.D., a physician employed by Brooklyn Hospital Center and another eligible policyholder for purposes of MLMIC's demutualization (plaintiff's exhibit 1). The Assignment Agreement is illustrative of what constitutes a "separate agreement" pursuant to the holding in Columbia Memorial Hospital as, in the Brooklyn Hospital Center agreement, policyholder Dr. [*5]Riggs acknowledges that his employer was entitled to receive the proceeds from the demutualization and actively assigns those cash consideration payments made by MLMIC to Brooklyn Hospital Center. (Riggs v. Brooklyn Hospital Center, 207 AD3d 405, 406 [1st Dept 2022])^FN1. In the case at bar, plaintiff executed no such agreement, and her execution of the Consent is insufficient to transfer, waive or assign her rights in the cash distribution to defendant.

Dismissal Pursuant to CPLR Rule 3211(a)(5)

On a motion to dismiss pursuant to CPLR §3211(a)(5), the burden is on the movant to establish, prima facie, that the time in which to commence the action has expired. (Romanelli v. DiSilvio, 76 AD3d 553, 554 [2010]). It is only then that the burden shifts to the plaintiff to aver evidentiary facts which establish that the cause of action falls within an exception to the statute of limitations or raises an issue of fact as to whether an exception applies (Texeria v. BAB Nuclear Radiology, P.C., 43 AD3d 403, 405 [2007]). Where a defendant fails to establish that claims are time-barred as of the date that the Complaint was interposed, a motion seeking dismissal pursuant to CPLR §3211(a)(5) is properly dismissed (see East Hampton Union Free School District v. Sandpebble Builders, Inc., 90 AD3d 821, 823 [2011]).

Here, defendant argues that all of plaintiff's causes of action are untimely based on the facts asserted in the Complaint, specifically that "NICO's acquisition of MLMIC closed on or about October 1, 2018, as of October 30, 2018, and, upon information and belief, more than $2.3 billion was paid out to the eligible policyholders pursuant to the plan" (Kim complaint, ¶ 19). However, plaintiff's Complaint actually asserts that "NICO agreed to pay Eligible Policyholders a total of approximately $2.5 billion in exchange for acquiring MLMIC" (id., ¶ 14). Thus, the remaining $200 million in cash consideration not distributed by October 30, 2018 may have included the $335,319.62 released to defendant on behalf of plaintiff.

Clearly, as the policy administrator specifically authorized to receive the cash consideration arising from MLMIC's demutualization on behalf of plaintiff, defendant should be aware of the date it received said funds. As defendant itself argues that receipt of the funds by defendant constitutes the accrual date of the action, presenting this date would constitute prima facie evidence as to the commencement of the action. Without prima facie evidence of this date, expiration of the time to bring an action cannot be proven. The defendant has, therefore, failed to meet its burden and that portion of defendant's motion seeking dismissal of all causes of action asserted by plaintiff based on statute of limitations grounds must be denied.

Dismissal Pursuant to CPLR §3211(a)(7)

"On a motion to dismiss a complaint pursuant to CPLR §3211(a)(7), the court must [*6]'accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible inference, and determine only whether the facts as alleged fit within any cognizable legal theory' " (Weill v. East Sunset Park Realty, LLC, 101 AD3d 859, 859 [2023] quoting Leon v. Martinez, 84 NY2d 83, 87-88 [1994]). The burden never shifts to the nonmoving party to rebut a defense asserted by the movant (Sokol v. Leader, 74 AD3d 1180, 1181 [2010]). Here, plaintiff's allegations support the causes of action she asserts against defendant, namely conversion, unjust enrichment, money had and received, breach of fiduciary duty and breach of fiduciary duty seeking rescission.

A conversion occurs "when someone intentionally and without authority, assumes or exercises control over personal property belonging to someone else, interfering with that person's right of possession (see Colavito v. New York Organ Donor Network, Inc., 8 NY3d 43, 49-50 [2006]). Two key elements of conversion are the plaintiff's possessory right or interest in the property and the defendant's dominion over the property or interference with it, in derogation of the plaintiff's rights (see id. at 50)" (Siegler v. Lippe, 189 AD3d 903, 904 [2020]). Plaintiff here has stated a prima facie claim for conversion as, contrary to Defendant's argument, she did not act to cede plaintiff's cash consideration to defendant. Defendant received the demutualization proceeds on plaintiff's behalf but interfered with her right of possession as defendant failed to forward said proceeds to her despite defendant's appointment as her agent^FN2.

With regard to plaintiff's unjust enrichment claim, "[t]he essential inquiry. . . is whether it is against equity and good conscience to permit the defendant to retain what is sought to be recovered" (Paramount Film Distrib. Corp. v. State of New York, 30 NY2d 415, 421 [1972]). Here, based upon the ruling in Columbia Memorial Hospital, 38 NY3d 253, defendant's retention of the demutualization funds constitutes unjust enrichment (see Wyckoff Imaging Services, P.C. v. Blutreich, 228 AD3d 990, 991 [2025]).

Similarly, plaintiff's claims stating a cause of action for money had and received were sufficient for purposes of CPLR §3211(a)(7) as plaintiff has sufficiently pled that defendant received money belonging to plaintiff, defendant has benefitted from the receipt of that money, and defendant's retention of that money is unconscionable (see Goel v. Ramachandran, 111 AD3d 783, 790 [2013]). Although defendant argues that plaintiff cannot assert causes of action for money had and received because the consent acted as a contract by and between plaintiff and defendant, this is not true. The consent was offered by MLMIC and relates only to the extension of defendant's authority from policy administrator to policy administrator with the additional specific authority to receive demutualization distributions on behalf of the policyholder.

Furthermore, defendant's arguments that plaintiff's claims for money had and received [*7]and unjust enrichment do not lie because they are quasi-contract in nature, and, therefore, are duplicative, must fail as plaintiff has not pled any cause of action sounding in breach of contract. "The existence of a valid and enforceable written contract governing a particular subject matter ordinarily precludes recovery in quasi-contract for events arising out of the same subject matter" (Clark-Fitzpatrick, Inc. v. Long Island Railroad Co., 70 NY2d 382, 388 [1987]). In the case at hand, plaintiff has not pled breach of contract. Therefore, her quasi-contract claims are proper at this juncture and plaintiff is entitled to plead alternative theories of recovery (see Goldman v. Simon Property Group, Inc., 58 AD3d 208, 220 [2008]).

Plaintiff asserts two causes of action sounding in breach of fiduciary duty, one which supports a claim for damages and a second which seeks rescission of the Consent form. The elements of a cause of action for breach of fiduciary duty include the existence of a fiduciary relationship, misconduct by the defendant, and damages to plaintiff which are a direct result of defendant's misconduct (Rut v. Young Adult Institute, Inc., 74 AD3d 776, 777 [2010]). Both of these claims are sufficiently pled here as a fiduciary duty on the part of defendant arises from plaintiff's execution of the Consent form which designated defendant, a policy administrator for purposes of receiving demutualization funds, agent for plaintiff, the policyholder.

Moreover, "[a] fiduciary relationship 'exists between two persons when one of them is under a duty to act for or to give advice for the benefit of another upon matters within the scope of the relation' (Restatement [Second] of Torts § 874, Comment a)" (EBC I, Inc. v. Goldman, Sachs & Co., 5 NY3d 11 [2005]). Defendant's breach of its fiduciary duty to plaintiff was evidenced by its instruction to plaintiff to execute the Consent without revealing its intention to retain the proceeds as well as its refusal to forward the demutualization proceeds to plaintiff even after she demanded same. The Consent established the fiduciary relationship by appointing defendant, the policy administrator, plaintiff's agent specifically for the purpose of receiving the demutualization cash distribution.

As this breach was the sole reason plaintiff did not receive the $335,319.62 to which she was entitled as a policyholder, plaintiff clearly states two claims arising from defendant's breach of its fiduciary duty to plaintiff for which relief may be granted by this Court, specifically money damages equaling $335,319.62 or rescission of the Consent which would itself require the return of the cash consideration received by defendant to plaintiff. As defendant has failed to meet its burden pursuant to CPLR §3211(a)(7), plaintiff's causes of action as pled in her Complaint remain.

Accordingly, defendant's motion seeking dismissal of plaintiff's Complaint pursuant to CPLR §§§ 3211(a)(1), (5), and (7), is denied.

Any issues not specifically addressed, herein have been considered by the Court and are also denied.

Dated: July 10, 2026

MARGUERITE A. GRAYS, J.S.C.