Newark, NJ — A federal judge has ruled in favor of State Farm, ending a years-long dispute over insurance payouts tied to repeated water damage and mold issues at a Parsippany home. The decision grants summary judgment to the insurer, concluding the case without a trial and rejecting the homeowner’s claims for additional compensation.
U.S. District Judge Esther Salas Semper issued the ruling on April 23, 2026, finding that the plaintiffs failed to show sufficient evidence that State Farm underpaid or mishandled claims tied to two separate incidents in 2014 and 2019.
The lawsuit was brought on behalf of homeowner Loreta Codella, through a power of attorney, and centered on disagreements over how much the insurer owed for repairs, including mold remediation.
Two water incidents triggered long-running dispute
The case stems from damage at a home on Cory Court in Parsippany, where two separate water-related incidents occurred years apart.
The first incident, in December 2014, involved a broken water supply line under a kitchen sink, which caused water to spill onto hardwood flooring. The second, in March 2019, involved a leak from an upstairs bathroom that damaged multiple levels of the home, including the living room and basement.
State Farm had active insurance policies covering both events, each including up to $50,000 in coverage for mold-related damage.
Disagreements focused on scope of damage
After the 2014 incident, State Farm paid more than $9,000 for flooring repairs based on an inspection and contractor invoice, then closed the claim later that year.
In 2019, the insurer paid nearly $18,000 in actual cash value for the second loss, after applying a $1,000 deductible under the policy.
The dispute escalated when a contractor later discovered extensive mold in the home, which the plaintiffs argued stemmed from the earlier 2014 incident and should have been more fully addressed at that time.
State Farm ultimately reviewed additional estimates and approved more than $58,000 in coverage for remediation work, including over $31,000 specifically for mold damage.
Key Points
• Federal judge granted summary judgment to State Farm in insurance dispute
• Case involved two water damage incidents in 2014 and 2019 at Parsippany home
• Court found insufficient evidence that insurer underpaid or mishandled claims
Court finds insurer met obligations under policy
Judge Semper determined that the plaintiffs did not provide enough evidence to show State Farm violated the terms of its insurance policies or acted improperly in handling the claims.
The ruling came at the summary judgment stage, meaning the court found no genuine dispute of material fact requiring a trial.
The opinion relied on documented inspections, contractor estimates, and payments made by State Farm over several years, concluding that the insurer responded within the scope of its contractual obligations.
Timeline and delays factored into case
The case also highlighted delays between damage, repairs, and follow-up discoveries. For example, flooring repairs from the 2014 incident were not completed until October 2015, months after the initial inspection and claim approval.
Later, mold discovered during 2019 repairs became a central point of contention, with plaintiffs arguing it should have been identified earlier.
However, the court found those arguments insufficient to establish liability against the insurer based on the evidence presented.
What happens next
With summary judgment granted, the case is effectively closed at the district court level unless the plaintiffs choose to appeal.
The ruling confirms that State Farm is not required to make additional payments beyond what has already been issued under the policies.
As it stands, no further proceedings are scheduled in the case.
