In re: The Matter of TK Boat Rentals, L.L.C., No. 2:2017cv01545 - Document 191 (E.D. La. 2018)
Court Description: ORDER AND REASONS granting 117 Motion for Partial Summary Judgment. Signed by Judge Sarah S. Vance on 9/6/2018. (Reference: All cases)(cg)
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In re: The Matter of TK Boat Rentals, L.L.C. Doc. 191 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA IN RE: TK BOAT RENTALS, LLC as owner and operator of the M/ V MISS IDA, for exoneration from or lim itation of liability. CIVIL ACTION NO. 17-1545 c/ w 17-2446 and 17-3657 SECTION “R” (4) ORD ER AN D REASON S Before the Court is defendant Andre Boudreau’s m otion for partial sum m ary judgm ent against defendant Allianz Global Corporate and Specialty Marine Insurance Com pany (AGCS). 1 For the following reasons, the Court grants the m otion. I. BACKGROU N D This consolidated action arises out of a boat collision. 2 Plaintiffs scheduled a chartered fishing trip with defendant Extreme Fishing through Troy Wetzel, Extrem e Fishing’s founder and sole m ember, 3 for February 12, 1 R. Doc. 117. R. Doc. 1. For a m ore detailed account of the facts of this case, see R. Doc. 186. 3 R. Doc. 10 7-6 at 1 ¶¶ 2-3; R. Doc. 112-8 at 1 ¶¶ 2-3; R. Doc. 113-1 at 1 ¶¶ 2-3. 2 Dockets.Justia.com 20 17. 4 Wetzel arranged for Boudreau to captain the trip. 5 On February 11, the M/ V KINGFISH, the vessel that was scheduled to be used for the trip, becam e inoperable. 6 The parties ultim ately arranged to instead use defendant Chase St. Clair’s fishing vessel, the M/ V SUPER STRIKE. 7 Shortly after the trip began, the SUPERSTRIKE collided with the M/ V MISS IDA, a vessel owned by defendant TK Boat Rentals (TKBR). 8 The owners of the MISS IDA and of the SUPERSTRIKE each filed lim itation of liability actions relating to the collision. 9 Plaintiffs filed claim s in these lim itation actions against Extreme Fishing, Wetzel, TKBR, St. Clair and Boudreau. 10 Plaintiffs later am ended their original com plaint to add AGCS as a defendant. 11 AGCS provided m arine liability insurance to Extrem e Fishing and Wetzel (the AGCS policy). 12 4 R. Doc. 1 at 3 ¶ 13 (Case No. 17-2446); see also R. Doc. 10 7-6 at 4 ¶ 15; R. Doc. 112-8 at 2 ¶ 15; R. Doc. 113-1 at 2 ¶ 15. 5 R. Doc. 10 7-6 at 5 ¶ 19; R. Doc. 112-8 at 2 ¶ 19; R. Doc. 113-1 at 2 ¶ 19. 6 R. Doc. 10 7-6 at 4 ¶ 18; R. Doc. 112-8 at 2 ¶ 18; R. Doc. 113-1 at 2 ¶ 18. 7 R. Doc. 10 7-6 at 5 ¶ 20 ; R. Doc. 112-8 at 3 ¶ 20 ; R. Doc. 113-1 at 2 ¶ 20 . 8 R. Doc. 10 7-6 at 7 ¶ 28; R. Doc. 112-8 at 3 ¶ 28; R. Doc. 113-1 at 3 ¶ 28. 9 R. Doc. 1; R. Doc. 1 (Case No. 17-3657). 10 R. Doc. 5; R. Doc. 17. 11 R. Doc. 54. 12 Id. at 2 ¶ 3. 2 St. Clair and Boudreau filed a crossclaim against AGCS asserting that the AGCS policy covers Extrem e Fishing’s use of St. Clair’s vessel. 13 Boudreau now m oves for partial summ ary judgment against AGCS on the lim ited issue of whether AGCS has a duty to defend Boudreau under the term s of the AGCS policy. 14 II. LEGAL STAN D ARD Sum m ary judgment is warranted when “the m ovant shows that there is no genuine dispute as to any m aterial fact and the m ovant is entitled to judgm ent as a m atter of law.” Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 10 69, 10 75 (5th Cir. 1994). When assessing whether a dispute as to any m aterial fact exists, the Court considers “all of the evidence in the record but refrain[s] from m aking credibility determ inations or weighing the evidence.” Delta & Pine Land Co. v. Nationw ide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 20 0 8). All reasonable inferences are drawn in favor of the nonm oving party, but “unsupported allegations or affidavits setting forth ‘ultim ate or conclusory facts and conclusions of law’ are insufficient to either 13 14 R. Doc. 79. R. Doc. 117. 3 support or defeat a m otion for sum m ary judgment.” Galindo v. Precision Am . Corp., 754 F.2d 1212, 1216 (5th Cir. 1985); see also Little, 37 F.3d at 10 75. “No genuine dispute of fact exists if the record taken as a whole could not lead a rational trier of fact to find for the nonm oving party.” EEOC v. Sim baki, Ltd., 767 F.3d 475, 481 (5th Cir. 20 14). If the dispositive issue is one on which the m oving party will bear the burden of proof at trial, the m oving party “m ust come forward with evidence which would entitle it to a directed verdict if the evidence went uncontroverted at trial.” Int’l Shortstop, Inc. v. Rally ’s, Inc., 939 F.2d 1257, 1264-65 (5th Cir. 1991) (internal citation om itted). The nonm oving party can then defeat the motion by either countering with evidence sufficient to dem onstrate the existence of a genuine dispute of m aterial fact, or by “showing that the m oving party’s evidence is so sheer that it m ay not persuade the reasonable fact-finder to return a verdict in favor of the m oving party.” Id. at 1265. If the dispositive issue is one on which the nonm oving party will bear the burden of proof at trial, the m oving party m ay satisfy its burden by pointing out that the evidence in the record is insufficient with respect to an essential element of the nonm oving party’s claim . See Celotex, 477 U.S. at 325. The burden then shifts to the nonm oving party, who m ust, by 4 subm itting or referring to evidence, set out specific facts showing that a genuine issue exists. See id. at 324. The nonm ovant m ay not rest upon the pleadings, but m ust identify specific facts that establish a genuine issue for trial. See, e.g., id.; Little, 37 F.3d at 10 75 (“Rule 56 m andates the entry of sum m ary judgment, after adequate tim e for discovery and upon m otion, against a party who fails to m ake a showing sufficient to establish the existence of an elem ent essential to that party’s case, and on which that party will bear the burden of proof at trial.” (quoting Celotex, 477 U.S. at 322)). III. D ISCU SSION The scope of a duty to defend contained in a liability insurance policy is generally “broader than the scope of the duty to provide coverage.” Colem an v. Sch. Bd. of Richland Parish, 418 F.3d 511, 523 (quoting Suire v. Lafay ette City -Parish Consol. Gov’t, 90 7 So.2d 37, 51-52 (La. 20 0 5)); accord Lam ar Advertising Co. v. Cont’l Cas. Co., 396 F.3d 654, 660 (5th Cir. 20 0 5). Courts apply the so-called “eight corners rule” when determining an insurer’s duty to defend under Louisiana law. Under this rule, a court com pares the allegations of the petition against the insured with the language of the insurance policy. Martco Ltd. P’ship v. W ellons, Inc., 588 F.3d 864, 872 (5th Cir. 20 0 9); see also Lodw ick, LLC v. Chevron USA, Inc., 126 So.3d 544, 550 5 (La. App. 2 Cir. 20 13) (“[Under] the ‘eight corners rule’ . . . an insurer m ust look to the ‘four corners’ of the plaintiff’s petition and the ‘four corners’ of its policy to determ ine whether it has a duty to defend.”). The insurer has a duty to defend its insured if the underlying petition “disclose[s] even a possibility of liability under the policy.” Vaughn v. Franklin, 785 So. 2d 79, 84 (La. App. 1 Cir. 20 0 1) (citing Steptore v. Masco Constr. Co., 643 So. 2d 1213, 1218 (La. 1994)); accord Martco Ltd., 588 F.3d at 872-73. “In other words, the test is not whether the allegations unambiguously assert coverage, but whether they do not unambiguously exclude coverage.” Johnson v. Misirci, 955 So. 2d 715, 718 (La. App. 4 Cir. 20 0 7). Indeed, the duty to defend “exist[s] if there is at least a single allegation in the petition under which coverage is not unam biguously excluded.” Yarborough v. Fed. Land Bank of Jackson, 731 So.2d 482, 487-88 (La. App. 2 Cir. 1999) (collecting cases). The court m aking this determ ination m ust liberally interpret the underlying petition and assum e all allegations to be true. Martco Ltd., 588 F.3d at 873; Vaughn, 785 So. 2d at 83-84 (quoting Am . Hom e Assur. Co. v. Czarniecki, 230 So. 2d 253, 259 (La. 1969)). If the insured bears its burden of dem onstrating that any allegations possibly fall within coverage, the burden shifts to the insurer to prove that the underlying petition states only facts that fall within an exclusion from coverage. Id. at 872. 6 In determ ining whether AGCS has a duty to defend Boudreau in the underlying suit, the Court thus looks only to plaintiffs’ com plaint against Boudreau and the AGCS policy. Despite its apparent awareness of Louisiana’s “eight corners rule,” AGCS asks the Court to consider a num ber of extraneous docum ents, including correspondence notifying AGCS of the collision, St. Clair’s m arine insurance policy for the SUPERSTRIKE through the GEICO, and various court filings in this case. 15 None of these docum ents is cognizable in determ ining AGCS’s duty to defend because they are not incorporated in the underlying petition against Boudreau. See generally Lam ar Advert. Co., 396 F.3d at 660 (“Whether an insurer has a duty to defend is determ ined solely by com par[ing] the allegations in the com plaint against the insured with the term s of the policy at issue. . . .”). AGCS issued a Charter Value Vessel Policy to Wetzel that provides liability coverage for the KINGFISH. 16 The policy defines “insured” individuals to include “persons . . . using the Watercraft with [Wetzel’s] prior perm ission.”17 Indem nity, 15 16 17 Under a section titled “Coverage for Protection and Medical Paym ents, and R. Doc. 142. R. Doc. 117-2. Id. at 5. 7 Uninsured and Underinsured Watercraft,” the policy contains a provision for “Temporary Substitute Watercraft,” which provides that [i]f your Watercraft is out of norm al use because of a covered loss, we will cover dam ages you are legally obligated to pay for bodily injury or property dam age arising from the m aintenance, use, or control of a tem porary substitute Watercraft. The Tem porary substitute Watercraft m ust be of a sim ilar type, value and length as the Watercraft that is out of norm al use. But we do not cover tem porary substitute Watercraft being used for any purpose other than replacing your Watercraft while it is out of norm al use due to a covered loss. 18 AGCS has a duty to defend Boudreau in this action under the term s of the AGCS Policy. First, plaintiffs’ com plaint against Boudreau asserts the following key facts: (1) plaintiffs booked a charter fishing trip with Extreme Fishing through Wetzel; (2) Wetzel’s boat became inoperable shortly before the day of the trip; (3) the parties instead arranged to use St. Clair’s vessel; (4) Boudreau captained the vessel on the day of the collision under the course of his em ploym ent with Extrem e Fishing; and (5) plaintiffs suffered bodily injuries as a result of the collision. 19 Second, the AGCS policy m ay cover any liability Boudreau m ay incur as a result of plaintiffs’ allegations. The parties’ use of the SUPERSTRIKE appears to fall under the policy’s “Tem porary Substitute Watercraft” 18 19 Id. at 13. R. Doc. 1 at 3-5 ¶¶ 13-18 (Case No. 17-2446). 8 provision. 20 There is insufficient inform ation in plaintiffs’ complaint to determ ine whether the SUPERSTRIKE was of a “sim ilar type, value, and length” as the KINGFISH—or whether the KINGFISH becam e inoperable as a result of a “covered loss”—but this lack of inform ation does not relieve the insurer from its duty to defend. 21 N at’l Cas. Co. v. W . W orld Ins. Co., 669 F.3d 60 8, 612-13 (5th Cir. 20 12) (“Where the com plaint does not state facts sufficient to clearly bring the case within or without the coverage, the general rule is that the insurer is obligated to defend if there is, potentially, a case under the com plaint within the coverage of the policy.”). The complaint also sufficiently asserts that Boudreau was functioning as an “insured” under the term s of the policy, because it states that Boudreau was captaining the SUPERSTRIKE in the course of his em ployment for Wetzel and Extrem e Fishing. 22 AGCS bears the burden to prove that the com plaint states only facts that fall within an exclusion from coverage, see Martco Ltd., 588 F.3d at 872, but it has failed to m eet this burden. AGCS instead argues that Boudreau is not covered by the policy because AGCS was not provided tim ely notice of loss, and that even if it were obligated to defend Boudreau, that defense 20 21 22 R. Doc. 117-2 at 13. Id. See id. at 5; R. Doc. 1 at 4 ¶ 15 (Case No. 17-2446). 9 would be triggered only when Boudreau exhausts his alleged prim ary insurance under St. Clair’s GEICO policy. 23 But the Court cannot determ ine from just the com plaint and the AGCS policy whether Boudreau will be unam biguously excluded from coverage because AGCS did not receive timely notice. Nor can the Court possibly determ ine from the eight corners of the docum ents whether the terms of GEICO’s policy will preclude coverage under the AGCS policy. AGCS’s arguments are therefore unavailing. Because there is no genuine dispute that plaintiffs’ complaint asserts facts that m ay allow Boudreau to receive coverage under the term s of the AGCS policy, AGCS has a duty to defend Boudreau. IV. CON CLU SION For the foregoing reasons, Boudreau’s m otion for partial sum m ary judgm ent is granted. New Orleans, Louisiana, this _ _6th _ _ _ day of Septem ber, 20 18. _____________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE 23 R. Doc. 142 at 7. 10
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