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Plaintiffs-appellants Parks Real Estate Purchasing Group, Parks Associates Real Estate, Inc., Parks & Associates Real Estate Ltd., Parks Associates Real Estate, Mazal Group, LLC, Newmark & Company Real Estate (collectively, "Parks") appeal from a summary judgment entered in the United States District Court for the Southern District of New York (Preska, J.). The action was brought to recover under a first-party property insurance contract (the "Policy") between Parks and defendant-appellee St. Paul Fire and Marine Insurance Company ("St.Paul"). Among the properties insured by the Policy was a building at 90-100 John Street in New York City (the "Building" or "Property"). On September 11, 2001, as a result of the World Trade Center collapse, a cloud of noxious particulate matter spread throughout the downtown New York City area where the insured Building is located. The particulate matter apparently penetrated the Building and settled in its mechanical and electrical systems. In this action, Parks also sought to recover on claims against defendants National Union Fire Insurance Company of Pittsburgh, Pennsylvania, and Great Northern Insurance Company under policies of insurance issued by those companies, but those claims were dismissed. Following discovery, St. Paul submitted a motion for summary judgment, arguing that Parks' claims for damage to the insured Building were foreclosed by the contamination exclusion in the Policy. Parks argued that the damage to the insured Building was not caused by contamination within the meaning of the contamination exclusion provision.

In granting summary judgment in favor of St. Paul, the District Court determined that the particulate matter from the World Trade Center collapse created a condition of impurity that rendered the building unfit for use by the introduction of unwholesome elements. The court determined this damage was properly considered contamination for purposes of the contamination exclusion clause in the Policy, and St. Paul was entitled to deny coverage for the loss claimed by Parks. The District Court also found that the dominant efficient cause of the loss was not the collapse of the World Trade Center but the infiltration of the building by the particulate matter created by the collapse. For the reasons that follow, we vacate the judgment of the District Court and remand for further proceedings consistent with this opinion.


472 F.3d 33 (2006)

PARKS REAL ESTATE PURCHASING GROUP, Parks Associates Real Estate, Inc., Parks & Associates Real Estate Ltd., Mazal Group, L.L.C., Parks Associates Real Estate, and Newmark & Company Real Estate, Plaintiffs-Appellants, v. ST. PAUL FIRE AND MARINE INSURANCE COMPANY, Defendant-Appellee, and National Union Fire Insurance Company of Pittsburgh and Great Northern Insurance Company, Defendant.

Docket No. 05-5890-CV.

United States Court of Appeals, Second Circuit.

Argued: June 22, 2006.

Decided: December 21, 2006.

New York Law School Location: File #3493, Box #151