Stanley Bernstein, left, and Sandy Liebhard, right, of Bernstein Liebhard. 

Plaintiffs firm Bernstein Liebhard's bid to collect $13 million from its insurance company after a fire swept through its offices was rejected by a New York state judge earlier this month, a new transcript shows.

The law firm has argued for years that Sentinel Insurance Co. Ltd was obliged to compensate it for the money it would have made by bringing suits on behalf of victims of defective drugs and medical devices if the fire hadn't interrupted its business. But Sentinel contended that a ruling last year by the Appellate Division, First Department, put the kibosh on Bernstein Liebhard's claim.

In a transcript made public Tuesday, Manhattan Supreme Court Justice Andrea Masley said she felt her initial decision to allow the lawsuit to proceed to trial had been correct. In light of the First Department's ruling, though, she said she had no choice but to reject the firm's motion to amend its suit.

“It seems clear to me that [the appellate judges] were saying 'the end,'” Masley said, according to the transcript. “Maybe I'm wrong. I don't know if you're going to appeal that, but maybe it will be different, but I don't think I can. And I really feel that you're asking me to reverse them, and I don't feel comfortable doing that.”

“Maybe sleep on it over the weekend, your honor,” suggested Johnathan Lerner, one of the founders of Lerner, Arnold & Winston, who argued for Bernstein Liebhard.

“That's actually the court's decision,” the judge said.

The decision, which is dated June 6, is another setback for Bernstein Liebhard, which claimed losses of $21 million and dialed back its demand to $13 million after the First Department ruling. The firm had argued that New York law on what it could recover was unclear up until last year's appellate ruling and said it had reserved the right to change its claim, but Masley, in ruling against the firm this month, didn't accept that argument.

The firm said the fire that swept through its offices on 40th Street in Manhattan in August 2013 destroyed its computer system, phone system and main file room, derailing cases and stopping it from advertising to find new clients. The firm said it had trouble with backups and its mass torts practice was simply “overloaded” in the period that followed.

In claim paperwork from 2017 that was filed in court records, the firm said it lost $18.7 million in fees from vaginal mesh cases and $7 million on cases related to the drug Risperdal, each of which was estimated to net $60,000. It chalked up another $1.9 million in losses for cases labeled “metal-on-metal hip revision surgery,” each of which was good for $75,000 in fees.

It wasn't immediately clear whether Bernstein Liebhard would challenge Masley's ruling. Its lawyers, Lerner and Frank Winston of Lerner Arnold, didn't respond to a comment request. Gerald “Kip” Dwyer Jr., a lawyer at Robinson & Cole who represents Sentinel, declined to comment.