What happened: Phoenix Insurance alleges AmGuard refused to cover the defense of three additional insureds under a snow-removal subcontractor's liability policy after a slip-and-fall at a Brooklyn bank branch.
Who's involved: Phoenix Insurance (plaintiff), AmGuard Insurance (defendant), JPMorgan Chase, Jones Lang LaSalle, SMS Assist, Donovan Property Service.
What's at stake: $53,705.68 in defense costs already spent - and still climbing - plus a potential $1 million coverage obligation.
Why it matters: The case tests whether an insurer can accept a defense in name while imposing conditions that leave the upstream carrier footing the bill.
Where it stands: Complaint filed October 27, 2026, in the Eastern District of New York.
Someone slipped on ice at a JPMorgan Chase bank branch in Brooklyn. Four years later, the injury case is still going - and the two insurers behind the property's coverage are now suing each other over who should be paying the lawyers.
Phoenix Insurance Company filed suit on October 27, 2026, in the US District Court for the Eastern District of New York. The complaint alleges that AmGuard Insurance Company has failed to properly take on the defense of three companies - SMS Assist, JPMorgan Chase, and Jones Lang LaSalle Americas - that qualify as additional insureds under a policy AmGuard issued to a snow-removal subcontractor. Phoenix says it has been covering their defense out of its own pocket: $53,705.68 as of October 20, 2026, with the meter still running.
The property setup is a common one in commercial real estate. JPMorgan Chase owned the bank branch at 2401 Ralph Avenue in Brooklyn. Jones Lang LaSalle managed it. SMS Assist handled property maintenance and subcontracted all snow and ice removal to a company called Donovan Property Service.
Under a master services agreement, Donovan was required to carry liability insurance of at least $1 million per incident and $2 million in total, with SMS Assist, JLL, and JPMorgan Chase all listed as additional insureds - meaning Donovan's policy would cover them too, and would pay first before any of their own insurance kicked in.
AmGuard insured Donovan under exactly that kind of policy, according to the complaint. Phoenix separately insured SMS Assist, but its policy was designed to sit behind any other available coverage - a backup, not the frontline.
On January 10, 2022, a man alleges he slipped and fell on snow or ice at the property, suffering what the complaint describes as "lumbar and cervical nerve damage with radiculopathy." He sued JPMorgan Chase and JLL. The question of who pays for their defense is what landed in federal court.
Phoenix says it formally asked AmGuard to take over the defense on January 30, 2023.
Some 20 months passed. On October 2, 2024, AmGuard finally responded. According to the complaint, AmGuard agreed to defend SMS Assist, JPMorgan Chase, and JLL - but on its own terms. It reserved the right to deny coverage later without explaining why, and it insisted that the same lawyer already representing Donovan also represent the three additional insureds.
That last condition is the crux of the dispute. The complaint alleges it created an impossible conflict: the additional insureds would be sharing a lawyer with the very subcontractor whose snow-removal work may have caused the injury. Their interests were not aligned, and the complaint argues they were entitled to their own, independent counsel at AmGuard's expense.
Phoenix tried again on February 11, 2026, demanding that AmGuard accept the defense cleanly within 30 days and reimburse every dollar Phoenix had already spent. The complaint states AmGuard did not meet the March 13, 2026, deadline.
Phoenix wants three things from the court. First, a ruling that AmGuard's policy covers the additional insureds and pays first - before Phoenix's backup coverage contributes anything. Second, a ruling that the additional insureds are entitled to their own lawyers, funded by AmGuard. Third, a money judgment for the $53,705.68 already spent, plus whatever continues to accrue.
The case puts a practical question in front of claims teams that manage subcontractor insurance programs: what happens when the subcontractor's insurer accepts a tender but attaches conditions that make the acceptance unworkable? For the additional insureds caught in between, the endorsement that was supposed to protect them has so far delivered a three-year billing dispute instead.
The allegations in the complaint have not been tested, and no court has ruled on the merits.
