Endurance Am. Ins. Co v. Cheyenne Partners LLC
| Decision Date | 29 July 2022 |
| Docket Number | Civil Action 6:20-cv-00571 |
| Parties | ENDURANCE AMERICAN INSURANCE COMPANY v. CHEYENNE PARTNERS, LLC, ET AL. |
| Court | U.S. District Court — Western District of Louisiana |
REPORT AND RECOMMENDATION
Pending before the court are cross-motions for partial summary judgment concerning the coverage provided by a commercial general liability insurance policy issued by Travelers Indemnity Company of Connecticut and an excess follow-form insurance policy issued by Travelers Property Casualty Company of America, both of which were issued to Global Data Systems, Inc. The first motion was filed by cross-claimants Steven Ensminger, Jr.; Stephen Wade Berzas, individually and on behalf of his minor children M.B., G.B., C.B., and K.B MacKenzie Berzas; Mignone Denay Crisp, individually and in her capacity as Administratrix for the Estate of Robert Vaughn Crisp, III; and Kristie Danielle Britt (hereinafter collectively referred to in this report and recommendation as “the Claimants”) and seeks a declaration that both insurance policies provide coverage to the Claimants for damages sustained as a result of the airplane crash that led to this litigation. (Rec. Doc. 391). The second motion was filed by Travelers Indemnity Company of Connecticut and Travelers Property Casualty Company of America (hereinafter collectively referred to in this report and recommendation as “the Insurers”) and seeks a declaration that the policies provide no coverage for the Claimants' alleged damages. (Rec. Doc. 414). The Claimants opposed the Insurers' motion, and the Insurers opposed the Claimants' motion. Additionally, Global Data Systems, Inc.; Southern Lifestyle Development Company, LLC SLD Aircraft, LLC; Rodney L. Savoy; RRCO Aircraft, LLC; Parkside Properties, LLC; Cheyenne Partners, LLC; Eagle Air, LLC; and Charles E. Vincent filed a brief in support of the Claimants' motion. (Rec. Doc. 411). Finally, Megan Thomas, individually; Megan Thomas and Allen Richardson on behalf of their minor child, Ilan Richardson; Rayna Ledet, individually and on behalf of her minor child, Devynn Mitchell; Rayna Ledet and Rodney Gardner on behalf of their minor children, Rodney Garner, Jr. and Royden Gardner; Ashley Ballard, individually; Ashley Ballard and Anthony Boudreaux on behalf of their minor children, Anthony Boudreaux, Jr. and Alijah Boudreaux; and Ashley Ballard and Roy Nora, on behalf of their minor child, Aron Ballard, filed a brief in support of the Claimants' motion and in opposition to the Insurers' motion. (Rec. Doc. 430). Both motions were referred to the undersigned magistrate judge for review, report, and recommendation in accordance with the provisions of 28 U.S.C. § 636 and the standing orders of the court. Considering the evidence, the law, and the arguments of the parties, and for the reasons fully explained below, it is recommended that the Claimants' motion should be granted and the Insurers' motion should be denied.
A small airplane, Piper N42CV (hereinafter referred to as “the Piper”), crashed shortly after takeoff in Lafayette, Louisiana, on December 28, 2019, while headed to the Peach Bowl in Atlanta. The airplane was owned by Cheyenne Partners, LLC and piloted by Ian Biggs. Five persons in addition to the pilot were onboard the airplane: Gretchen D. Vincent, Michael Walker Vincent, Robert Vaughn Crisp, II, Stephen Wade Berzas, and Carley McCord Ensminger. Mr. Crisp and Mr. Berzas were employed by Global Data Systems, Inc. Ms. Vincent and Mr. Vincent were the wife and son of Global Data Systems, Inc.'s CEO, Chris Vincent, and the daughter-in-law and grandson of Global Data Systems, Inc.'s founder and chairman of the board, Charles “Chuck” Vincent. Ms. Ensminger was a friend of Ms. Vincent. Everyone in the airplane died except Mr. Berzas, who was seriously injured. Kristie Danielle Britt was seriously injured when the airplane struck her car as it crashed. Several persons claim to have sustained damages because they witnessed the crash.
This lawsuit began as an interpleader action brought by Endurance Insurance Company under Fed.R.Civ.P. 22. According to Endurance's complaint, Endurance issued Aircraft Insurance Policy No. NAI6025731 to Cheyenne Partners, LLC, covering the period from July 1, 2019, to July 1, 2020, with a combined single limit for bodily injury and property damage liability of $5 million each person/each occurrence, including crew and passengers. Endurance alleged that the additional insureds named in the policy are Eagle Air, LLC; Global Data Systems, Inc.; SLD Aircraft, LLC; Ian Biggs; Southern Lifestyle Development Company, LLC; and Rodney Savoy. Although many parties claiming an interest in the proceeds of Endurance's insurance policy engaged in pre-suit mediation and filed suits in Louisiana state court, the prosecution of claims arising out of the plane crash - other than in this proceeding - was enjoined.[1] Accordingly, the claims of all persons allegedly damaged as a result of the crash will be adjudicated in this forum and within the parameters of this lawsuit.
Travelers Indemnity Company of Connecticut issued a commercial general liability insurance policy, Policy No. 630-1D760921, to Global Data Systems, Inc. (“the Primary Policy.”)[2] The CGL part of the policy provides a $2 million general aggregate limit.[3] Travelers Property Casualty Company of America issued an excess follow-form insurance policy, Policy No. CUP-1J918743, to Global Data Systems, Inc. (“the Excess Policy.”)[4] It has an excess follow-form and umbrella liability coverage limit of $10 million.[5] Both policies have a policy period from May 8, 2019 to May 8, 2020. The Claimants seek coverage under these policies, while the Insurers contend that the policies do not provide coverage for damages sustained as a result of the airplane crash.
Under Rule 56(a) of the Federal Rules of Civil Procedure, summary judgment is appropriate when there is no genuine dispute as to any material fact, and the moving party is entitled to judgment as a matter of law. Material facts are those that might affect the outcome of the lawsuit under the governing law.[6] A genuine issue of material fact exists if a reasonable jury could render a verdict for the nonmoving party.[7] The party seeking summary judgment has the initial responsibility of informing the court of the basis for its motion and identifying those parts of the record that demonstrate the absence of genuine issues of material fact.[8] If the moving party carries its initial burden, the burden shifts to the nonmoving party to demonstrate the existence of a genuine issue of material fact.[9] If the dispositive issue is one on which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by pointing out that there is insufficient proof concerning an essential element of the nonmoving party's claim.[10] All facts and inferences must be construed in the light most favorable to the nonmoving party, and the court should neither weigh the evidence nor make credibility findings.[11]
In diversity cases, federal courts apply federal procedural rules and the substantive law of the forum state.[12] Here, Louisiana is the forum state, and subject-matter jurisdiction is based on diversity of citizenship.[13] Additionally, under Louisiana's choice of law rules, “the law of the state where the insurance contract was issued and executed generally governs the interpretation of that contract.”[14] The insurance policies at issue in this lawsuit were issued to Global at its address in Lafayette, Louisiana.[15] Therefore, Louisiana substantive law regarding the interpretation of insurance contracts must be applied. .The parties are in agreement that Louisiana substantive law is applicable.
Under Louisiana law, the interpretation of an insurance policy usually involves a legal question,[16] and whether an insurance policy provides or precludes coverage is a dispute that can be resolved on a motion for summary judgment.[17]However, “[s]ummary judgment declaring a lack of coverage under an insurance policy may not be rendered unless there is no reasonable interpretation of the policy, when applied to the undisputed material facts shown by the evidence supporting the motion, under which coverage could be afforded.”[18]
Under Louisiana law, insurance policies are contracts between the insured and the insurer and are construed using the general rules of interpretation of contracts set forth in the Louisiana Civil Code.[19] Therefore, the interpretation of a contract requires the determination of the parties' common intent.[20] In other words, the “parties' intent as reflected by the words in the policy determine the extent of coverage.”[21] If the policy wording at issue is clear and unambiguously expresses the parties' intent, the insurance contract must be enforced as written.”[22] Consistently, when the terms used in a contract are clear and explicit and do not lead to absurd consequences, no further interpretation may be made in search of the parties' intent.[23] If the policy contains ambiguous provisions, however, the ambiguous provisions “are generally construed against the insurer and in favor of coverage.”[24]A policy provision is ambiguous if it is susceptible to two or more reasonable interpretations.[25] The determination of whether a contract is clear or ambiguous is a question of law.[26]
The words used in a contract must be given their plain, ordinary and generally prevailing meaning.[27] If the contract involves a technical matter,...
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