Westville requested that all other boats navigate at low speeds, the lawsuit alleges. The Philadelphia boat was traveling at "excessive speed" when it turned around, leaving a significant wake, the suit says.
The wake pushed Westville's boat against industrial equipment at the dock, the suit says, "causing severe damage."
An insurance adjuster decided that hull damage was so extensive that the boat was a "total loss."
Since then, the claim has bounced around among the departments, insurance officials, and state and federal courts.
Westville's attorney, M. James Maley Jr., said Monday the municipality and the Municipal Joint Insurance Fund were working together to recover losses of $140,600.
The suit alleges Philadelphia responders were negligent and failed to consider the damage their boat would cause by creating a wake, and that the city failed to properly train its emergency workers.
An attorney for the Philadelphia Fire Department, refusing to accept responsibility for the claim, filed a claim against Westville saying Philadelphia, as a public entity, could not be sued. A Philadelphia Common Pleas Court judge agreed, but was overturned on appeal. Westville then filed suit this month against Philadelphia in New Jersey Superior Court.
On Friday, the city moved to have the case heard in federal court.
Steve Calder, the lawyer representing the Philadelphia Fire Department, said he could not comment on the case because it is pending litigation, except to say the city intended to defend against the allegations.