DECISION & ORDER Before the Court is Plaintiff Argonaut Insurance Company’s motion to dismiss Defendant City of Troy, New York’s counterclaims. See dkt. # 12. The parties have briefed the issues and the Court has determined to decide the matter without oral argument. I. BACKGROUND This case concerns insurance coverage that Plaintiff Argonaut Insurance Company (“Argonaut”) provided Defendant City of Troy, New York (“Troy” or “the City”). The coverage dispute arose out of an action against the City filed by Victoria Leigh Brothers in the Supreme Court of Rensselaer County, New York in 2017. Complaint (“Complt.”), dkt. # 1, at 7. Brothers sued the City after she fell and injured herself at a vacant property the City owned and maintained. Id. Argonaut provided Troy with insurance coverage at the relevant time. Id. at 8. The policy Argonaut provided was a “Retained Limit Policy.” Id. Under that policy, the City agreed to a $500,000 Retained Limit of “self-insured retention.” Id. at 9. Included in that Retained Lim it was “‘any loss adjustment expenses [including defense costs] incurred by the insured.” Id. (internal quotation omitted). Acting within its policy rights, the City hired the law firm of Pattison, Sampson, Ginsberg, & Griffin (the “Ginsberg firm”) to defend against Brothers’ claim. Id. at 10. Argonaut took control of the defense in November 2018, retaining the law firm of Bailey, Johnson & Peck, P.C. (the “Bailey firm”). Id. at 11. At that time, Plaintiff and Defendant agreed that all invoices from the Bailey firm would be paid by Argonaut. Id. Argonaut does not seek to recover any fees and costs paid to that law firm in this action. Id. The case Brothers brought resolved after appeals and mediation. Id. at
12-14. The parties in that matter agreed to settle the case for an amount in excess of the Retained Limit of $500,000 contained in the policy. Id. That settlement therefore required that Argonaut contribute to the settlement. Id. A dispute had arisen, however, between Argonaut and the City about how much of that $500,000 Retained Limit the City had expended on defense costs. Id. at 15. Defendant alleges that the City had incurred around $100,000 in defense costs paid to the Bailey firm, the firm that the Plaintiff hired. Id. at 16. Plaintiff alleges that Defendant had not incurred any such costs. Id. The parties then began another dispute about $83,000 that Defendant had paid the Ginsberg firm, the law firm that the City hired. Id. at 17. That firm did not provide any invoices or billing entries to explain this bill. Id. Instead, the firm submitted a “Billing Journal” that indicated the firm had worked 543 hours on the matter. Id. at 18. The records, Plaintiff alleges, did not include any actual billing entries or descriptions of tasks. Id. The undeveloped nature of the records, Plaintiff claims, “is problematic because” Plaintiff cannot “determine,” among other problems, “(1) how much of the billed time was expended on coverage/insurance issues; and (2) how that many hours were spent defending the City — given the relatively limited amount of work product that was completed.” Id. at 19. The parties settled the dispute on an interim basis by agreeing that the settlement for Brothers’ lawsuit would be paid by a $317,000 contribution from the Defendant and $983,000 from the Plaintiff. Id. at 20. Plaintiff filed the instant action on October 9, 2019 to address this dispute about Defendant’s alleged obligation to fund defense costs. The Complaint contains two counts. Count One alleges breach of contract due to Defendant’s failure to pay the $100,000 paid to the Bailey firm as part of the $500,000 Retainer Limit. Plaintiff seeks recovery of that amount. Count Two also alleges breach of contract, in this case because Plaintiff alleges that Defendant has not properly accounted for the fees Defendant was obligated to pay the Ginsberg firm as part of the Retainer Limit. Plaintiff alleges that failing to file itemized billing records constitutes a breach of contract and demands that Defendant pay some portion of the $83,000 the Ginsberg firm charged. Defendant’s answer to the Complaint contains six counterclaims. See dkt. # 8. The first counterclaim alleges that Defendant is entitled to recover attorneys fees and expenses incurred in defending the instant action if Defendant prevails on Plaintiff’s claims. As to the second counterclaim, Defendant alleges that when Argonaut took over the defense of Brothers’ lawsuit, “Defendant was led to believe that” Plaintiff “would deny coverage unless the City agreed to” representation from the Bailey firm. Id. at 51. Defendant alleges, however, that the Bailey firm had a conflict in representing the City. Id. at 52. That conflict, Defendant alleges, grew out of the Bailey firm’s representation of Rensselaer County and Michael Sikirica in an action commenced in this court, Thomas v. Mason, Fountain, Colaneri, and Sikirica, No. 17cv626. In that case, Defendant claims, the City — through its police officers Mason, Fountain, and Colaneri — had a competing interest with Rensselaer County. Id. at 53. Another conflict arose, Defendant claims, when the Bailey firm represented Rensselaer County and Sikiricka in another lawsuit that involved City Police Officers as co-defendants. Id. at
