(TAN) WORLD TRADE CENTER PROPERTIES, L.L.C., SILVERSTEIN PROPERTIES, INC., SILVERSTEIN WTC MANAGEMENT CO., L.L.C., 1 WORLD TRADE CENTER, L.L.C., 2 WORLD TRADE CENTER, L.L.C., 4 WORLD TRADE CENTER, L.L.C., 5 WORLD TRADE CENTER, L.L.C., WESTFIELD WTC, L.L.C., WESTFIELD CORPORATION, INC., WESTFIELD AMERICA, INC., AND THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY, DEFENDANTS-COUNTER-CLAIMANTS-COUNTER-DEFENDANTS-APPELLANTS-CROSS-APPELLEES, UBS WARBURG REAL ESTATE INVESTMENTS INC., WELLS FARGO BANK MINNESOTA, N.A., AS TRUSTEE FOR THE REGISTERED HOLDERS OF GMAC COMMERCIAL MORTGAGE SECURITIES, INC. MORTGAGE-BACKED PASS-THROUGH CERTIFICATES, SERIES 2001-WTC, AND GMAC COMMERCIAL MORTGAGE CORPORATION, DEFENDANTS-COUNTER-CLAIMANTS-COUNTER-DEFENDANTS-CROSS-APPELLEES v. HARTFORD FIRE INSURANCE COMPANY AND ROYAL INDEMNITY COMPANY, COUNTER-DEFENDANTS-APPELLEES, ST. PAUL FIRE & MARINE INSURANCE CO., COUNTER-DEFENDANT-APPELLEE-CROSS-APPELLANT, SR INTERNATIONAL BUSINESS INSURANCE CO., LTD., PLAINTIFF-COUNTER-DEFENDANT-INTERVENOR, ALLIANZ INSURANCE COMPANY, COPENHAGEN REINSURANCE CO., EMPLOYERS INSURANCE OF WAUSAU, FEDERAL INSURANCE COMPANY, GREAT LAKES REINSURANCE (UK) PLC., GULF INSURANCE COMPANY, HOUSTON CASUALTY CO., INDUSTRIAL RISK INSURERS, LEXINGTON INSURANCE CO., CERTAIN UNDERWRITERS AT LLOYD'S OF LONDON, QBE INTERNATIONAL INSURANCE LIMITED, SWISS REINSURANCE CO. UK LTD., TIG INSURANCE CO., TOKIO MARINE AND FIRE INSURANCE CO., TRAVELERS INDEMNITY COMPANY, TWIN CITY FIRE INSURANCE CO., WÜRTTEMBERGISCHE VERSICHERUNG AG AND ZURICH AMERICAN INSURANCE CO., COUNTER-DEFENDANTS. SR INTERNATIONAL BUSINESS INSURANCE CO., LTD., PLAINTIFF-COUNTER-DEFENDANT, WORLD TRADE CENTER PROPERTIES, L.L.C., SILVERSTEIN PROPERTIES, INC., SILVERSTEIN WTC MANAGEMENT CO. L.L.C., 1 WORLD TRADE CENTER, L.L.C., 2 WORLD TRADE CENTER, L.L.C., 4 WORLD TRADE CENTER, L.L.C., 5 WORLD TRADE CENTER, L.L.C., WESTFIELD WTC, L.L.C., WESTFIELD CORPORATION, INC., WESTFIELD AMERICA, INC., AND THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY, DEFENDANTS-COUNTER-CLAIMANTS-APPELLANTS, UBS WARBURG REAL ESTATE INVESTMENTS INC., WELLS FARGO BANK MINNESOTA, N.A., AS TRUSTEE FOR THE REGISTERED HOLDERS OF GMAC COMMERCIAL MORTGAGE SECURITIES, INC. MORTGAGE-BACKED PASS-THROUGH CERTIFICATES, SERIES 2001-WTC, AND GMAC COMMERCIAL MORTGAGE CORPORATION, DEFENDANTS-COUNTER-CLAIMANTS v. THE TRAVELERS INDEMNITY COMPANY, COUNTER-DEFENDANT-APPELLEE, ALLIANZ INSURANCE COMPANY, COPENHAGEN REINSURANCE CO., EMPLOYERS INSURANCE OF WAUSAU, FEDERAL INSURANCE COMPANY, GREAT LAKES REINSURANCE (UK) PLC, GULF INSURANCE COMPANY, HARTFORD FIRE INSURANCE COMPANY, HOUSTON CASUALTY CO., INDUSTRIAL RISK INSURERS, LEXINGTON INSURANCE CO., CERTAIN UNDERWRITERS AT LLOYD'S OF LONDON, QBE INTERNATIONAL INSURANCE LIMITED, ROYAL INDEMNITY COMPANY, ST. PAUL FIRE & MARINE INSURANCE COMPANY, SWISS REINSURANCE CO. UK LTD., TIG INSURANCE CO., TOKIO MARINE AND FIRE INSURANCE CO., TWIN CITY FIRE INSURANCE CO., WÜRTTEMBERGISCHE VERSICHERUNG AG, AND ZURICH AMERICAN INSURANCE CO., COUNTER-DEFENDANTS

This case arises out of the devastating tragedy that occurred at the World Trade Center ("WTC") in lower Manhattan, New York, on the morning of September 11, 2001. At issue in this case is the amount of insurance that is recoverable for the total destruction of the WTC that occurred after the buildings were struck by two fuel-laden aircraft that had been hijacked by terrorists. The appellants are numerous entities that have varying property interests in the WTC, including the Port Authority of New York and New Jersey (the "Port Authority"), which owns the property in fee simple, and Silverstein Properties, Inc. and several related entities ("Silverstein Properties"). In the spring of 2001, Silverstein Properties was the successful bidder on a 99-year lease for the property from the Port Authority. In July 2001, Silverstein Properties obtained primary and excess insurance coverage for the WTC complex from about two dozen insurers (most of which constitute the appellees and other counter-defendants in this case) in the total amount of approximately $3.5 billion "per occurrence." Because Silverstein Properties is the party that actually obtained the insurance coverage at issue in this case and was the primary insured, for ease of reference all appellants will hereafter be referred to collectively as the "Silverstein Parties."

The parties do not dispute that the destruction of the WTC resulted in a loss that greatly exceeded $3.5 billion. The broad question presented in this case is whether the events of September 11, 2001 constituted one or two "occurrences." The answer will determine whether the Silverstein Parties can recover once, up to $3.5 billion, or twice, up to $7 billion, under the insurance coverage. Complicating the resolution of this question is the fact that as of September 11, 2001, only one of the many insurers that bound coverage on the WTC had issued a final policy, necessitating an individualized inquiry to determine the terms of the insurance binders issued by each insurer.

This litigation began on October 22, 2001 when one of the WTC insurers, plaintiff-counter-defendant-intervenor SR International Business Insurance ("SR International"), filed suit against the Silverstein Parties "seek[ing] a judicial declaration of its rights and obligations to all of the insureds under the policy" and a "declaration that the damage to the World Trade Center is one insurance loss." The Silverstein Parties subsequently filed counterclaims against the other WTC insurers, seeking a declaration "that the events of September 11th constituted more than one occurrence under the coverage that the counterclaim-defendant[s] agreed to provide to the Silverstein Parties."1 After an initial assignment to another judge, the action was assigned to District Judge John S. Martin Jr. of the United States District Court for the Southern District of New York for all purposes.

In the first of these related appeals, the Silverstein Parties appeal from three judgments, made final and appealable pursuant to Fed.R.Civ.P. 54(b), granting summary judgment in favor of appellees Hartford Fire Insurance Company ("Hartford"), Royal Indemnity Company ("Royal"),2 and St. Paul Fire & Marine Insurance Company ("St.Paul"), respectively, in which the district court held that (a) the binders they issued were governed by the insurance policy form circulated by Silverstein Properties' insurance broker, and (b) under the definition of "occurrence" in that form, the destruction of the WTC was one occurrence as a matter of law. In the second appeal, the Silverstein Parties appeal an interlocutory order of the district court, certified to this court pursuant to 28 U.S.C. § 1292(b), denying the Silverstein Parties' motion seeking summary judgment against appellee Travelers Indemnity Company ("Travelers") based on the argument that the events of September 11, 2001, constituted two occurrences as a matter of law under the undefined term "occurrence" contained in Travelers' insurance policy. This court issued orders granting the Silverstein Parties' petition for leave to appeal under 28 U.S.C. § 1292(b) and their motion to have the § 1292(b) and Rule 54(b) appeals heard in tandem.

For the following reasons, the judgments of the district court are affirmed.

As a condition of its 99-year lease of the WTC, Silverstein Properties was required to obtain first-party property insurance on the property. Silverstein Properties engaged Willis of New York ("Willis"), an insurance broker, to set up a multi-layered insurance program, which consisted of a primary insurance layer and 11 excess insurance layers providing a total of approximately $3.5 billion insurance on a "per occurrence" basis. In soliciting insurers for the program, Willis circulated a Property Underwriting Submission (the "Underwriting Submission") containing information regarding the proposed placement, including descriptions of the property and the insureds, desired coverage terms and conditions, estimated property values, engineering information, and a property loss history. With respect to at least the four insurers involved in these appeals, the Underwriting Submission also included a specimen copy of Willis's own "broker" form (the "WilProp form").3 Section VIII of the Underwriting Submission states: Policy Form and Contract between Silverstein and the [Port Authority] are attached. DRAFT WilProp for Real Estate Risks is attached. We anticipate that this form will ultimately require amendment to comply with the Contract between Silverstein Properties, Inc. and the [Port Authority]. In the meantime, we provide this document as a starting point.

Of the four insurers in these appeals, Travelers was the only insurer to submit its own specimen policy form (the "Travelers form") during the course of negotiating the terms of coverage.4 Whereas the Travelers form did not define the term "occurrence," the WilProp form defined occurrence as follows:

"Occurrence" shall mean all losses or damages that are attributable directly or indirectly to one cause or to one series of similar causes. All such losses will be added together and the total amount of such losses will be treated as one occurrence irrespective of the period of time or area over which such losses occur.

SR Int'l Bus. Ins. Co. v. World Trade Ctr. Props. LLC, 222 F.Supp.2d 385, 398 (S.D.N.Y.2002).

As we will explain in greater detail, each of the appellees negotiated separately with Willis concerning its participation in the insurance program and all had bound coverage on various layers as of July 20, 2001. During the course of the next several weeks, Willis negotiated with Travelers over the terms of its final policy, but the Silverstein Parties have presented no evidence to indicate that any of the other appellees participated in or were aware of the details of those negotiations. As of September 11, 2001, none of the appellee-insurers had issued a final policy form, nor had Willis issued the WilProp form as a final policy form, although at least one other participating insurer, Allianz Insurance Company ("Allianz"), had issued a final policy. SR Int'l Bus. Ins. Co. v. World Trade Ctr. Props. LLC, No. 01 Civ. 9291(JSM), 2002 WL 1163577, at *2 & n. 3 (S.D.N.Y. June 3, 2002); see also SR Int'l Bus. Ins. Co. v. World Trade Ctr. Props. LLC, No. 01 Civ. 9291(JSM), 2003 WL 192487, at *4 (S.D.N.Y. Jan.29, 2003). On September 14, 2001, three days after the WTC was destroyed, following discussions between Willis and Travelers, Travelers issued its final policy form.

As a threshold matter, we address the basis for federal subject matter jurisdiction over these exclusively state law claims involving insurance coverage and contract interpretation. "An inquiry respecting [jurisdiction] is one we always have the power to undertake, and where jurisdiction is questionable we are obliged to examine it sua sponte." Petereit v. SB Thomas, Inc., 63 F.3d 1169, 1175 (2d Cir.1995). Although we are satisfied that jurisdiction exists here, we discuss the issue because of some unusual circumstances presented in this case.

The district court did not specifically address jurisdiction in its opinion denying summary judgment. It apparently was of the view, however, that the action against Travelers was separate from the SR International litigation and related counterclaims, and noted that Travelers is a Connecticut company with its principal place of business in Connecticut, while the entities comprising Silverstein Properties are all either Delaware or New York companies and have their principal places of business in New York. We need not decide if there was jurisdiction over the separate action initially filed by Silverstein Properties against Travelers, however, because in March 2002, prior to the district court's decision denying summary judgment, that action was withdrawn without prejudice by stipulation of the parties and Travelers was added as a counterclaim defendant to the action brought against the Silverstein Parties by SR International. See supra n. 1. Accordingly, we address only whether there exists federal jurisdiction over the latter action.

According to the Silverstein Parties, federal jurisdiction exists in this case because there is complete diversity between all of the defendants and plaintiff SR International and supplemental jurisdiction applies to defendants' counterclaims against Travelers and the other insurers. A review of the parties' citizenship5 appears to support this assertion. Plaintiff SR International is a foreign corporation (a citizen of the United Kingdom), but this does not preclude diversity because 28 U.S.C. § 1332(a)(2) provides federal jurisdiction over actions between "citizens of a State and citizens or subjects of a foreign state."

Defendant Wells Fargo is a national bank (i.e., not incorporated in any one state) and by statute is deemed to be a citizen of every state in which it has offices. 28 U.S.C. § 1348 ("All national banking associations shall, for the purposes of all [ ] actions by or against them [other than a few enumerated in the statute], be deemed citizens of the States in which they are respectively located."); see United Republic Ins. Co., in Receivership v. Chase Manhattan Bank, 315 F.3d 168, 169 (2d Cir.2003) (per curiam) (recalling mandate, vacating prior summary order, and remanding to district court to determine whether diversity jurisdiction existed under 28 U.S.C. §§ 1332 & 1348 in light of fact that defendant banks had branch offices in plaintiff's home state); but see Lerner v. Fleet Bank, N.A., 318 F.3d 113, 124-25 (2d Cir.2003) (implicitly assuming that national bank was a citizen of New York, presumably its principal place of business, for purposes of diversity). The fact that Wells Fargo may be a citizen of several unidentified states does not affect diversity here, however, because SR International is a foreign citizen.

Defendant Port Authority presents a closer question on jurisdiction because it is a state-created body, thereby raising the possibility that it is a not a "citizen" of any state, the effect of which would be to destroy diversity. The Port Authority is a body "corporate and politic" established in 1921 pursuant to a bi-state compact between New York and New Jersey, see N.Y. Unconsol. Law § 6407 (McKinney 2000), and assented to by Congress, see 42 U.S. Stat. 174 (1921). The Port Authority's mission was, and remains, the development of public transportation, terminal, and other facilities of commerce within the statutorily defined Port Authority district, which includes the area in and around New York City harbor. See N.Y. Unconsol. Law § 6403. The Port Authority is governed by a board of commissioners, see id. §§ 6405-06, whose resolutions are essentially legislative acts of the bi-state entity that must be approved by the governors of both states. See id. §§ 7151-52.

Baron v. Port Auth., 271 F.3d 81, 83 (2d Cir.2001). We have found no case addressing the question of whether the Port Authority can be considered a "citizen" for purposes of diversity jurisdiction, and courts that have addressed this question with respect to other port authorities and similar agencies in other states have reached different conclusions based largely on the level of autonomy enjoyed by the agency. Compare Indiana Port Comm'n v. Bethlehem Steel Corp., 702 F.2d 107, 110 (7th Cir.1983) (holding that "[Indiana Port Commission] is not the `alter ego' of the state of Indiana, and is, in fact, an independent corporate entity seeking to assert its own rights in this action," and, therefore, there was diversity jurisdiction), and C.H. Leavell & Co. v. Bd. of Comm'rs of Port of New Orleans, 424 F.2d 764, 767 (5th Cir.1970) (holding that "[Louisiana] Dock Board is a sufficiently separate entity from the State of Louisiana to sustain diversity jurisdiction") with Tradigrain, Inc. v. Mississippi State Port Auth., 701 F.2d 1131, 1134 (5th Cir.1983) (finding, based on statutes and other factors, that "Mississippi State Port Authority is merely the alter ego of the State of Mississippi, and as such is not a `citizen' for purposes of diversity jurisdiction").

Although whether the Port Authority is a "citizen" of New York for diversity purposes is apparently an issue of first impression in our circuit, case law has established that it is a political subdivision of the state and, therefore, is not entitled to sovereign immunity. See Feeney v. Port Auth. Trans-Hudson Corp., 873 F.2d 628, 631 (2d Cir.1989) (holding that Eleventh Amendment immunity was inapplicable to "PATH [in part because of] the fact that the compact between New York and New Jersey describes the Port Authority as a `municipal corporate instrumentality,' N.Y. Unconsol. Laws § 6459 (McKinney 1979) and N.J. Stat. Ann. § 32:1-33 (West 1963), language consistent with its being a political subdivision"); see also Japan Airlines Co. v. Port Auth., 178 F.3d 103, 110-12 (2d Cir.1999) (holding, after extensive analysis, "that the Port Authority was not entitled to [either sovereign or] governmental immunity [for case arising out of proprietary conduct], and the district court properly instructed the jury to treat the Port Authority as it would any private corporation"). In light of these rulings, we hold that, as is the case with political subdivisions in general, the Port Authority is not so closely aligned with the two state governments that created it to foreclose its being treated as a citizen of both New York and New Jersey for diversity purposes. See Illinois v. City of Milwaukee, 406 U.S. 91, 97, 92 S.Ct. 1385, 31 L.Ed.2d 712 (1972) ("It is well settled that for the purposes of diversity of citizenship, political subdivisions are citizens of their respective States."). Accordingly, we agree with the Silverstein Parties that complete diversity exists between plaintiff SR International and all of the defendants in this action.

We also agree with the Silverstein Parties that supplemental jurisdiction provides jurisdiction over the Silverstein Parties' counterclaims against the other insurers even though some of these insurers may be non-diverse. See 28 U.S.C. § 1367 (setting forth requirements for supplemental jurisdiction); Viacom Int'l, Inc. v. Kearney, 212 F.3d 721, 726-27 (2d Cir. 2000) (observing that § 1367 permits defendants to assert claims against non-diverse third parties in diversity cases); David Siegel, Practice Commentary, "The 1990 Adoption of § 1367, Codifying `Supplemental' Jurisdiction," printed in 28 U.S.C.A. § 1367 at 832-33 (West 1993) (same); see also Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365, 374-77 & n. 18, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978) (holding that whereas plaintiff's claims against non-diverse parties destroyed diversity jurisdiction, ancillary (now supplemental) jurisdiction supported defendant's counterclaims and third-party claims against non-diverse parties); Herrick Co. v. SCS Communications, Inc., 251 F.3d 315, 325 n. 8 (2d Cir.2001) ("The effect of Kroger was therefore `to limit ancillary jurisdiction primarily to claims asserted by parties in a defensive posture, or who did not choose the federal forum. Therefore, at least in diversity cases, ancillary jurisdiction usually is not available for claims asserted by the plaintiff.'") (quoting 13 Charles Alan Wright, Arthur R. Miller and Edward H. Cooper, Federal Practice and Procedure: Jurisdiction § 3523) (emphasis added).

The Silverstein Parties also assert that there is federal jurisdiction under the Air Transportation Safety and System Stabilization Act of 2001, Pub.L. No. 107-42, § 408(b)(3), 115 Stat. 230, 241 (Sept. 22, 2001), as amended by the Aviation and Transportation Security Act of 2001, Pub.L. No. 107-71, § 201, 115 Stat. 597, 645 (Nov. 19, 2001).6 That Act, originally passed by Congress to limit the liability of air carriers for any claims arising from the September 11th attacks, was later amended to extend its protection to, inter alia, any "person with a property interest in the World Trade Center." Id. at § 408(a)(1). The purpose of the Act is to cap the liability of various entities for damages and contribution claims to the limits of their liability insurance coverage. The Act also creates a federal cause of action for any damages claims arising out of the September 11th attacks. Id. at § 408(b)(1). In addition, the Act grants to the District Court for the Southern District of New York "original and exclusive jurisdiction over all actions brought for any claim (including any claim for loss of property, personal injury, or death) resulting from or relating to the terrorist-related aircraft crashes of September 11, 2001." Id. at § 408(b)(3).

While the other parts of § 408 apply only to liability claims brought against air carriers, World Trade Center property interest holders, and similar entities, the jurisdictional grant of § 408(b)(3) is considerably broader, and its plain language would appear to encompass the instant claims filed by the World Trade Center property interest holders against their insurers — claims that are clearly "related to" the September 11th attacks. The very breadth of this jurisdictional grant, however, raises the question of whether it exceeds the constitutional limitations on Congress's authority to grant jurisdiction to federal courts. See Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S. 480, 491, 103 S.Ct. 1962, 76 L.Ed.2d 81 (1983) (noting that "Congress may not expand the jurisdiction of the federal courts beyond the bounds established by the Constitution," such as to purely state-law claims). In fact, in the only opinion in this litigation to discuss jurisdiction, the district court, while addressing a different issue, noted that there is "a serious question whether the grant of jurisdiction in the Act applies to this case," and that to avoid the constitutional question presented, it "would be inclined to construe the Act's grant of jurisdiction as not extending to these claims between the insurers and their insureds." SR Int'l Bus. Ins. Co. v. World Trade Ctr. Props. LLC, 2002 WL 1905968, at *2 (S.D.N.Y. Aug.19, 2002) (holding, after analyzing the statute, that the parties' contractual appraisal procedure for determining the amount of loss was not preempted by the Act). The district court ultimately concluded, "[h]owever, [that it] need not decide whether Congress either intended to or could vest this Court with exclusive jurisdiction over an action between the Silverstein Parties and their insurers." Id. at *3.

We recently acknowledged these same constitutional concerns in a case between foreign reinsurers involving a breach of contract claim arising out of the September 11th terrorist attack, in which we observed that to construe the statute "to encompass all claims for economic loss" relating to the September 11th attacks would raise "serious doubts as to its constitutionality." Canada Life Assurance Co. v. Converium Rückversicherung (Deutschland) AG, 335 F.3d 52, 59 (2d Cir.2003). We declined to "delineate the precise contours of Section 408(b)(3)'s jurisdictional grant," finding it clear that the case then before us, as to which there was no claim or defense that would "require adjudication of any issue of law or fact that concern[ed] the events of September 11," fell outside the statute. Id. at 57.

Because, as discussed above, this federal action is supported by diversity and supplemental jurisdiction, we need not and do not decide whether there would also be jurisdiction under the Act and thereby avoid unnecessarily addressing these constitutional concerns. Cf. Edward J. DeBartolo Corp. v. Fla. Gulf Coast Bldg. & Constr. Trades Council, 485 U.S. 568, 575, 108 S.Ct. 1392, 99 L.Ed.2d 645 (1988) ("[W]here an otherwise acceptable construction of a statute would raise serious constitutional problems, the Court will construe the statute to avoid such problems unless such construction is plainly contrary to the intent of Congress."); United States v. Arrous, 320 F.3d 355, 360 (2d Cir.2003) ("[W]e avoid interpreting statutes in a way that may create constitutional problems. . . .").

This court has jurisdiction to hear the Silverstein Parties' appeal from the grant of summary judgment in favor of Hartford, Royal, and St. Paul, notwithstanding the lack of a final judgment disposing of all claims against all parties, because the district court entered judgment pursuant to Fed.R.Civ.P. 54(b).7 We also have jurisdiction over the Silverstein Parties' interlocutory appeal from the denial of their motion for summary judgment against Travelers because the district court certified its decision for interlocutory appeal under 28 U.S.C. § 1292(b).8 We granted the Silverstein Parties' petition for leave to appeal the denial of summary judgment against Travelers pursuant to 28 U.S.C. § 1292(b) and their motion to expedite and consolidate the appeal with the Silverstein Parties' Rule 54(b) appeal.

II. RULE 54(B) APPEAL — HARTFORD, ROYAL, AND ST. PAUL

"We review the grant or denial of summary judgment de novo." Gibbs-Alfano v. Burton, 281 F.3d 12, 18 (2d Cir.2002) (quoting Republic Nat'l Bank v. Delta Air Lines, 263 F.3d 42, 46 (2d Cir.2001)). Summary judgment is appropriate only where "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). Thus, even where facts are disputed, in order to defeat summary judgment, the non-moving party must offer enough evidence to enable a reasonable jury to return a verdict in that party's favor. See Anderson v. Liberty Lobby, 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). When ruling on a motion for summary judgment, a court is required to construe the evidence in the light most favorable to the non-moving party and to draw all reasonable inferences in its favor. See id. at 255; Maguire v. Citicorp Retail Servs., Inc., 147 F.3d 232, 235 (2d Cir.1998).

The district court granted the motions by Hartford, Royal, and St. Paul seeking partial summary judgment on the grounds that each of the insurers had issued a binder that incorporated the terms of the WilProp form and that under the WilProp form's definition of "occurrence" there was only one occurrence on September 11, 2001. See SR Int'l Bus. Ins. Co. v. World Trade Ctr. Props. LLC, 222 F.Supp.2d 385, 393-95, 398-99 (S.D.N.Y.2002) ("Hartford Dec."). The district court found that the only relevant question was what were the terms to which the parties had agreed to be bound pending issuance of a final policy, and thus deemed irrelevant evidence indicating that the parties might have agreed to ultimately issue policies tracking the Travelers policy. Id. at 389. The district court then reviewed each of the negotiating histories between Willis and Hartford, Royal, and St. Paul and analyzed the language of their binders. In part because the only policy form before the parties during these negotiations was the WilProp form furnished by Willis, the district court concluded that as a matter of law each of the three insurers had bound coverage on the basis of the WilProp form, rather than, as the Silverstein Parties contended, the Travelers form. Id. at 393-95, 398. The district court further held that, as a matter of law, under the WilProp form's definition of "occurrence" the damage caused on September 11th was the result of one occurrence, entitling the Silverstein Parties to no more than a single policy limit on each of the insurers' policies. Id. at 399.

As noted by the district court, "[a]n insurance binder is a unique type of contract." Id. at 388.

It is a common and necessary practice in the world of insurance, where speed often is of the essence, for the agent to use this quick and informal device to record the giving of protection pending the execution and delivery of a more conventionally detailed policy of insurance. Courts, recognizing that the cryptic nature of binders is born of necessity and that many policy clauses are either stereotypes or mandated by public regulation, are not loath to infer that conditions and limitations usual to the contemplated coverage were intended to be part of the parties' contract during the binder period.

Employers Commercial Union Ins. Co. v. Firemen's Fund Ins. Co., 45 N.Y.2d 608, 412 N.Y.S.2d 121, 384 N.E.2d 668, 670 (N.Y.1978) (footnote omitted) (quoted in Hartford Dec., 222 F.Supp.2d at 389). Thus, a binder is "a short method of issuing a temporary policy for the convenience of all parties, to continue until the execution of the formal one." Lipman v. Niagara Fire Ins. Co., 121 N.Y. 454, 24 N.E. 699, 700 (1890) (quoted in Hartford Dec., 222 F.Supp.2d at 388). As the New York Court of Appeals has explained,

[i]t has long been settled in this State that an insurance binder is a temporary or interim policy until a formal policy is issued. A binder provides interim insurance, usually effective as of the date of application, which terminates when a policy is either issued or refused.

Springer v. Allstate Life Ins. Co., 94 N.Y.2d 645,