R.M. Pers., Inc. v. Liberty Mut. Fire Ins. Co.
| Decision Date | 16 February 2018 |
| Docket Number | CAUSE NO.: A-16-CA-01030-SS |
| Parties | R.M. PERSONNEL, INC., Plaintiff, v. LIBERTY MUTUAL FIRE INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — Western District of Texas |
BE IT REMEMBERED on this day the Court reviewed the file in the above-styled cause, and specifically Plaintiff R.M. Personnel, Inc. (RMP)'s Motion for Partial Summary Judgment [#11] and Defendant Liberty Mutual Fire Insurance Company (Liberty)'s Response [#20] in opposition as well as Liberty's Unopposed Motion for Leave to File Cross Motion for Summary [#21].1 Having considered the case file and the applicable law, the Court enters the following opinion and orders.
This case concerns a dispute over insurance coverage in the aftermath of an accident at a commercial construction site in El Paso, Texas. On September 17, 2007, Luis Alberto Rodriguez fell fifty feet down an elevator shaft resulting in severe personal injuries. Mr. Rodriguez filed suit against RMP and others in County Court at Law Number Three in El Paso, Texas (the Rodriguez Lawsuit). RMP Mot. [#11-1] Ex. 1 (Third Am. Pet.). On May 19, 2015, Mr. Rodriguez obtained a judgment against RMP in the amount of $3,485,000 plus pre-judgment andpost-judgment interest and costs. An appeal of the judgment in the Rodriguez Lawsuit is still pending.2
The lawsuit before this Court concerns whether Liberty had a duty to defend RMP in the Rodriguez Lawsuit and whether Liberty has a duty to indemnify RMP in the event of a final adverse judgment. See Compl. [#1].
At the time of Mr. Rodriguez's accident, RMP was insured under a workers' compensation and employer's liability policy issued by Liberty and effective January 1, 2007 to January 1, 2008. RMP Mot. Ex. 3 [#16] (the Policy). Under the Policy, Liberty is required to provide defense and indemnity coverage for "bodily injury by accident" if "[t]he bodily injury . . . arise[s] out of and in the course of the injured employee's employment by [RMP]." Id. at LM 2796.
After being served in the Rodriguez Lawsuit, RMP sought coverage from Liberty, requesting Liberty provide RMP's defense. Compl. [#1] ¶ 6; Answer [#2] ¶ 6. Liberty denied coverage, claiming Mr. Rodriguez's petition alleged no employment relationship between RMP and Mr. Rodriguez as required by the Policy. See Compl. [#1] ¶ 11; Answer [#2] ¶ 11.
On diversity jurisdiction grounds, RMP filed this lawsuit seeking a declaratory judgment regarding Liberty's duty to defend and indemnify RMP in the Rodriguez Lawsuit. See Compl. [#1] ¶¶ 14-16. RMP also claims Liberty breached the Policy and is liable under the Prompt Payment Act, Tex. Ins. Code § 542.051 et seq., because it refused to defend RMP in the Rodriguez Lawsuit. Id. ¶¶ 17-20.
RMP filed a timely motion for partial summary judgment, is ripe for review.
Summary judgment shall be rendered when the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986); Washburn v. Harvey, 504 F.3d 505, 508 (5th Cir. 2007). A dispute regarding a material fact is "genuine" if the evidence is such that a reasonable jury could return a verdict in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). When ruling on a motion for summary judgment, the court is required to view all inferences drawn from the factual record in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986); Washburn, 504 F.3d at 508. Further, a court "may not make credibility determinations or weigh the evidence" in ruling on a motion for summary judgment. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000); Anderson, 477 U.S. at 254-55.
Once the moving party has made an initial showing that there is no evidence to support the nonmoving party's case, the party opposing the motion must come forward with competent summary judgment evidence of the existence of a genuine fact issue. Matsushita, 475 U.S. at 586. Mere conclusory allegations are not competent summary judgment evidence, and thus are insufficient to defeat a motion for summary judgment. Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007). Unsubstantiated assertions, improbable inferences, and unsupported speculation are not competent summary judgment evidence. Id. The party opposing summary judgment is required to identify specific evidence in the record and to articulate the precise manner in which that evidence supports his claim. Adams v. TravelersIndem. Co. of Conn., 465 F.3d 156, 164 (5th Cir. 2006). Rule 56 does not impose a duty on the court to "sift through the record in search of evidence" to support the nonmovant's opposition to the motion for summary judgment. Id.
"Only disputes over facts that might affect the outcome of the suit under the governing laws will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248. Disputed fact issues that are "irrelevant and unnecessary" will not be considered by a court in ruling on a summary judgment motion. Id. If the nonmoving party fails to make a showing sufficient to establish the existence of an element essential to its case and on which it will bear the burden of proof at trial, summary judgment must be granted. Celotex, 477 U.S. at 322-23.
As an initial matter, Liberty filed a motion for leave to file a cross-motion motion for summary judgment on February 12, 2018. See Mot. Leave [#21]. The Court previously extended the scheduling order deadlines, setting the deadline for dispositive motions as January 29, 2018. See Order of Oct. 12, 2017 [#10]. Thus, Liberty's request to file a cross-motion for summary judgment arrived over two weeks after Liberty's motion should have been filed. Rather than proactively filing a motion for extension, Liberty waited until the deadline was past. In lieu of an apology, Liberty listed a series of "scheduling conflicts that have delayed submission of [Liberty]'s cross-motion for summary judgment" as explanation for its lateness. Mot. Leave [#21] at 2. But Liberty provided no reason why any of these scheduling conflicts—which feature hearings, oral arguments, and a mediation—were unanticipated and prevented Liberty from filing a motion for an extension. See id. Instead, after benefiting from a full analysis of RMP'smotion for summary judgment, Liberty simultaneously filed both a response and a full summary judgment motion.
Moreover, Liberty's cross-motion for summary judgment violated this Court's rules in two ways. First, when filing a motion for leave in this Court, parties are directed to attach the document requiring leave of the Court to the motion requesting leave. See Administrative Policies and Procedures for Electronic Filing in Civil and Criminal Cases, Western District of Texas, § 4(c) (revised Dec. 1, 2016).3 While Liberty did so here, Liberty also directly filed its summary judgment motion, perhaps presuming the Court would grant its request for leave. See Liberty's Mot. Summ. J. [#19].4 Second, Liberty's electronically filed cross-motion for summary judgment, as well as its response to RMP's motion for summary judgment, included exhibits exceeding 400 pages. Under this Court's rules, filings exceeding 200 pages shall be filed traditionally with the Court. See Administrative Policies and Procedures for Electronic Filing in Civil and Criminal Cases, Western District of Texas, § 13(a) (revised Dec. 1, 2016).
Liberty's tardy cross-motion for summary judgment and disregard for the rules of this Court merit denial of Liberty's motion for leave and dismissal of its inappropriately filed pleading.
The Court now turns to the merits of RMP's motion for partial summary judgment. At this juncture, RMP only asks the Court to determine whether Liberty owed a duty to defend RMP in the Rodriguez Lawsuit.
Whether an insurer has a duty to defend its insured in an underlying lawsuit is a question of law. Liberty Mut. Ins. Co. v. Graham, 473 F.3d 596, 599 (5th Cir. 2006). And the parties agree Texas law governs this suit. See RMP Mot. [#11] at 10 (); Liberty Resp. [#20] at 3 (also applying Texas law).
Under Texas law, the "eight-corners rule" mandates "an insurer's duty to defend is determined by the underlying plaintiff's pleadings, considered in light of the policy provisions, without regard to the falsity of those allegations." Liberty Mut. Ins. Co., 473 F.3d at 599 (citing GuideOne Ins. Co. v. Fielder Rd. Baptist Church, 197 S.W.3d 305, 308 (Tex. 2006)). As a result, "only two documents are ordinarily relevant to the determination of the duty to defend: the policy and the pleadings of the underlying claimant." Id. at 590-600. If the four corners of a petition allege facts stating a cause of action which potentially falls within the four corners of the policy's scope of coverage, the insurer has a duty to defend. Id. at 600. If all the facts alleged in the underlying petition fall outside of the scope of coverage, then there is no duty to defend. Id.
An insured bears the burden of showing a claim against it potentially falls within the scope of a policy's coverage. Trinity Universal Ins. Co. v. Emp'rs Mut. Cas. Co., 592 F.3d 687, 691-92 (5th Cir. 2010). But courts "resolve all doubts regarding the duty to defend in favor of the duty." Id. (citing Northfield Ins. Co. v. Loving Home Care, Inc., 363 F.3d 523, 528 (5th Cir.2004)). Furthermore, courts construe the pleadings from the underlying lawsuit liberally. Trinity Universal Ins. Co., 592 F.3d at 691. "Where the complaint does not state facts sufficientto clearly bring the case within or without the coverage, the...
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