Fraud/Special Investigation

By way of background, on November 22, 2021, David Goyco was operating a Segway low-speed electric scooter (LSES), which has a maximum speed of 15.5 miles per hour, when he was struck by an automobile. As a result of the collision, Goyco sustained bodily injuries and incurred expenses associated with his medical treatment.

At the time of the accident, Goyco was insured under a policy of automobile insurance issued by Progressive Insurance Company. Goyco filed a claim for PIP benefits with Progressive Insurance Company. Progressive denied the claim stating that the LSES that Goyco was operating at the time of the accident did not meet the definition of a qualifying automobile pursuant to N.J.A.C. 39:6A-2(a) of the New Jersey Auto Insurance Law.

Progressive further denied Goyco’s claim for PIP benefits arguing that the LSES that was being operated at the time of the accident does not qualify him for meeting the definition of a pedestrian. Pedestrian is defined as “[a]ny person who is not occupying, entering into, or alighting from a vehicle propelled by other that muscular power and designed primarily for use on highways, rails and tracks.” N.J.A.C. 39:6A-2(h). 

In New Jersey, motorized scooters are generally categories as the same as motorcycles. As such, they are not subject to the statutory PIP benefits. See, Gerber v. Allstate Ins. Co., 161 N.J.Super. 543, 391 A.2d 1285 (Law Div.), holding that a motor scooter is a motorcycle. See also, Muto v. Kemper Reinsurance Co., 189 N.J.Super. 417 (App. Div. 1983), holding that motorcycle does not fall within the definition of an automobile.

However, a person not using a motorized or self propelled bicycle fits the definition of a “pedestrian” for the purposes of pedestrian PIP. See, Harbold v. Olin, 287 N.J.Super, 35 (App. Div. 1996), where it was found that, “[a] person riding a bicycle is considered a pedestrian for purposes of [New Jersey] automobile insurance laws. See also, Nuang by Nuang v. Pennsylvania Nat. Mut. Cas. Ins. Co., 224 N.J.Super. 753, 758, 541 A.2d 306, 308 (App. Div. 1988), holding that mopeds are always to be considered vehicles propelled by other than muscular power. 

On May 13, 2019, Governor Murphy issued a press release explaining that Bill S731 (N.J.S.A. 39:4-14.16(g) was passed so that “motorized scooters and e-bikes capable of traveling 20 miles per hour or slower [could] be regulated much the same as ordinary bicycles, allowing their operation on streets, highways, and bicycle paths in this State.” It was further explained that such bicycles and scooters will not require registration, insurance, or a driver’s license. Moreover, it was explained that “[t]he bill further provides that all statutes, rules and regulations that apply to ordinary bicycles will apply to low-speed electric bicycles and motorized scooters.”

Goyco filed a lawsuit in Superior Court challenging Progressive’s denial of his claim. He argued that New Jersey law does recognize bicyclists as pedestrians for purpose of PIP coverage, and by extension, a LSES should be considered the equivalent of a bicycle pursuant to N.J.S.A. 39:4-14.16(g).

The trial court dismissed Goyco’s complaint saying that the plaintiff was operating a scooter powered by motor at the time of the incident. As the scooter is clearly not considered a motor vehicle, neither in statute nor in the insurance policy, it must be determined if plaintiff would be considered a pedestrian. The trial court further found the plaintiff’s reliance on N.J.S.A. 39:4-14.16(g) is misplaced as the Statute is not a part of the No-Fault statute and is not controlling over the New Jersey Auto Insurance Law.

Moreover, the trial court found that the definition of pedestrian in N.J.S.A 39:6A-4 “clearly has no application to an LSES either...[t]he LSES was not muscular powered thus does not meet the requirements of the statute.” 

Thereafter, Goyco filed an Appeal to the Appellate Division. 

On Appeal, the panel noted that N.J.S.A. 39:1-1 expressly defines a LSES as having “an electric motor that is capable of propelling the device with or without propulsion.” As Judge Hudak found, the definition of pedestrian under N.J.S.A. 30A:6-4 is incompatible with the definition of a LSES and, therefore, N.J.S.A. 39:4-14.16(g), by its terms, has no application here.

The panel was also not persuaded that an LSES operator can be equated to a bicyclist, noting that the statute’s exception defeats this argument. They found that “[a]ll statutes . . . rules and regulations applicable to bicycles. . . shall apply to a LSES except those provisions which by their very nature may have no application to . . . a LSES.”

As such, the Appellate panel affirmed the lower courts dismissal of the complaint.

On October 6, 2023, The New Jersey Supreme Court granted Goyco’s petition for certification and has agreed to review this ruling and establish whether or not the operator of a low-speed electric scooter is a ‘pedestrian’ under N.J.S.A. 39:6A-2(h), and therefore entitled to PIP benefits.

On May 14, 2024, the Supreme Court of New Jersey affirmed the Appellate Division decision. 

The Supreme Court unanimously rejected Mr. Goyco’s reliance on N.J.S.A. 39:4-14.16(g).  The Court held that by its very definition the electronic scooter is a vehicle propelled by other than muscular power (battery-power) and designed primarily for use on highway.  The Court affirmed that, “by their very nature,” a low-speed electronic scooter does not qualify for PIP benefits. 

Therefore, Mr. Goyco was not a “pedestrian” for PIP benefits afforded to bicyclists as per the definition in N.J.S.A. 39:6A-2(h).  

The Supreme Court declined to expand the definition of pedestrian without more explicit language in the statute. Additionally, the Supreme Court also found that the scooter was “designed primarily for use on highways, rails and tracks,” even though the device used by Mr. Goyco on November 22, 2021, could not go faster than 15.5 miles per hour. The Court noted that “highway” is defined broadly as any main route, free to the public, such as a public road.  

Following the Supreme Court’s ruling, if a motor vehicle accident involves a motorized scooter being operated in New Jersey, the occupant of that scooter is not a pedestrian and will not be entitled to PIP medical expense benefits.  

Gary has extensive experience in disputes involving Personal Injury Protection claims and bodily injury claims. He also handles matters as a member of the Fraud/Special Investigation Practice Group. Gary primarily deals with evaluating both medical provider fraud and intentional/staged losses. In this arena, Gary has significant experience conducting Examinations Under Oath as it relates to both specific claims and broader SIU investigations. 

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