Kelley et al v. State Farm Fire and Casualty Company
Filing
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ORDER granting 36 Motion for Summary Judgment; Plaintiffs will be given 30 days from entry of this Order and Reasons to move for reconsideration by making the detailed and proper showing required by Louisiana law, if they can. The Court will withhold entry of a final judgment during this 30 day period. Signed by Judge Jay C. Zainey. (jrc)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
DAVID & JO ANN KELLEY
CIVIL ACTION
VERSUS
NO: 11-2230
STATE FARM FIRE AND CASUALTY
INSURANCE CO.
SECTION: "A" (4)
ORDER AND REASONS
Before the Court is a Motion for Summary Judgment (Rec. Doc. 36) filed by
defendant State Farm Fire and Casualty Co. Plaintiffs David and Jo Ann Kelley oppose the
motion. The motion, noticed for submission on February 12, 2014, is before the Court on the
briefs without oral argument.1 For the reasons that follow the motion is GRANTED.
I.
BACKGROUND
On August 9, 2011, Plaintiffs filed this action in state court to recover for damages
sustained during Hurricane Katrina. Prior to filing suit Plaintiffs estimated the damage to
their Metairie rental property to be $188,267.50. (Rec. Doc. 1-2, Exhibit B). They also sought
$63,089.16 in attorney's fees. (Id.). Plaintiffs alleged in their petition that they had received
no good faith tenders from State Farm notwithstanding their demand. (Rec. Doc. 1-1,
Petition ¶ VI). They demanded their policy limits and included a claim for statutory
penalties. (Id. ¶ VII). State Farm removed the action to this Court based on diversity
jurisdiction.
Shortly thereafter State Farm moved for judgment on the pleadings contending that
Plaintiffs' claims were prescribed. (Rec. Doc. 7). On October 14, 2011, the Court denied State
State Farm has requested oral argument but the Court is not persuaded that oral
argument would be helpful in light of the issues presented.
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Farm's motion, (Rec. Doc. 14), and the case was set for trial, (Rec. Doc. 16). The Court then
granted Plaintiffs' motion to stay the matter pending the resolution of several Louisiana
cases pertinent to the prescription issue in this case. (Rec. Docs. 21 & 31).
On November 13, 2013 State Farm moved to lift the stay because the Louisiana
Supreme Court had issued its decisions in the pending cases that Plaintiffs had cited in their
motion to stay. (Rec. Doc. 32). The Court granted the motion and the case was once again set
for trial. (Rec. Docs. 33 & 35). The case is scheduled to be tried to a jury on August 18, 2014.
State Farm now moves for summary judgment arguing that under Louisiana law
Plaintiffs’ claims are prescribed. According to State Farm Plaintiffs' petition is prescribed on
its face and so the burden of proof is on them to establish that their claims are timely. State
Farm contends that Plaintiffs cannot identify any putative class action that would have
interrupted prescription with respect to their claims notwithstanding that they have now
been given the opportunity to conduct discovery on the issue.
II.
DISCUSSION
Summary judgment is appropriate only if "the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any," when viewed in
the light most favorable to the non-movant, "show that there is no genuine issue as to any
material fact." TIG Ins. Co. v. Sedgwick James, 276 F.3d 754, 759 (5th Cir. 2002) (citing
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50 (1986)). A dispute about a material
fact is "genuine" if the evidence is such that a reasonable jury could return a verdict for the
non-moving party. Id. (citing Anderson, 477 U.S. at 248). The court must draw all justifiable
inferences in favor of the non-moving party. Id. (citing Anderson, 477 U.S. at 255). Once the
moving party has initially shown "that there is an absence of evidence to support the nonmoving party's cause," Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986), the non-movant
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must come forward with "specific facts" showing a genuine factual issue for trial. Id. (citing
Fed. R. Civ. P. 56(e); Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986)).
Conclusional allegations and denials, speculation, improbable inferences, unsubstantiated
assertions, and legalistic argumentation do not adequately substitute for specific facts
showing a genuine issue for trial. Id. (citing SEC v. Recile, 10 F.3d 1093, 1097 (5th Cir. 1993)).
When jurisdiction is based on diversity of citizenship, a federal court applies the
substantive law of the forum state, including its prescriptive period. Holt v. State Farm Fire
& Cas. Co., 627 F.3d 188, 191 (5th Cir. 2010) (citing Erie R. v. Tompkins, 304 U.S. 64 (1938));
Crase v. Astroworld, Inc., 941 F.2d 265, 267 (5th Cir. 1991). A federal court sitting in
Louisiana looks to the final decisions of Louisiana's highest court to determine Louisiana
law. Holt, 627 F.3d at 191 (citing Am. Int'l Spec. Line Ins. Co. v. Canal Indem. Co., 352 F.3d
254, 260 (5th Cir. 2003)).
Under Louisiana law, all claims filed against an insurer for recovery related to losses
from Hurricane Katrina had to be filed by September 1, 2007, unless some type of
suspension or interruption of prescription applies. See McGee v. State Farm Fire & Cas. Co.,
515 Fed. Appx. 291, 293 (5th Cir. 2013) (per curiam) (unpublished) (citing 2006 La. Acts
802). Although the mover typically bears the burden of proof on the issue of prescription,
the burden of proof shifts to the plaintiff to negate the presumption of prescription that
attaches when a petition is prescribed on its face. Taranto v. La. Citizens Prop. Ins. Corp.,
62 So. 3d 721, 726 (La. 2011) (citing Bailey v. Khoury, 891 So. 2d 1268, 1275 (La. 2005)).
In Taranto, supra, the Louisiana Supreme Court held that the filing of a lawsuit
designated as a class action pursuant to Louisiana Code of Civil Procedure article 591
suspends prescription for all members of the putative class until the district court has ruled
on the motion to certify the class. 62 So. 3d at 735. When notice is given pursuant to article
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596, the suspended prescription period resumes running. Id.
Following Taranto, the Louisiana Supreme Court decided Quinn v. Louisiana
Citizens Property Insurance Corp., 118 So. 3d 1011 (La. 2012). Quinn held that the
suspending provisions of Louisiana Code of Civil Procedure article 596 do not apply to
putative class actions filed in a federal court. Id. at 1012. According to the plain terms of
article 596, an individual plaintiff who files an independent suit must establish three
predicate facts: 1) the existence of a timely filed class action proceeding against the
defendant, 2) that he or she is a member of the class described or defined in the identified
class action petition, and 3) that the claims asserted in the independent action arise "out of
the transactions or occurrences described" in that petition. Id. at 1017. But article 596 does
not allow for "cross-jurisdictional tolling" so the timely-filed class action proceeding that the
plaintiff identifies must be one that was filed in a Louisiana state court. Id. at 1019.
In the instant case Plaintiffs filed their petition on August 9, 2011, which was nearly
four years after the final deadline of September 1, 2007, for Katrina claims. Therefore, under
Louisiana law Plaintiffs have the burden of establishing either a suspension or interruption
of the prescriptive period. Absent such a showing, State Farm will be entitled to judgment as
a matter of law.
To the extent that Plaintiffs attempt to satisfy their showing of the three predicate
facts under Quinn, the only class action that they mention by name in their opposition is 07558,2 Louisiana State, et al. v. AAA Insurance, et al. That case has over 600 docket entries
yet Plaintiffs never identify any specific record entry that contains the class definition that
they claim to be a part of. The Court was only able to discern from the parties' briefing that
The Court assumes that Plaintiffs meant to refer to Civil Action 07-5528, which has
been concluded for some time.
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the case had something to do with the Road Home Program. But Plaintiffs' depositions
indicate that they never participated in the Road Home Program and that their property
never qualified for Road Home assistance because it was rental property. (Rec. Doc. 44,
Exhibits A & B to State Farm's Reply). The Court agrees with State Farm's contention that
Plaintiffs cannot meet their burden by summarily alluding to a Katrina class action that
happened to name State Farm as a defendant. Instead they must demonstrate that their
specific claims fall within a specific class definition and Plaintiffs have failed to do that.
Moreover, Plaintiffs completely fail to address the potential problem with the type of crossjurisdictional tolling that they are attempting to employ given that the Road Home litigation
was removed to federal court in September 2007.
Accordingly, and for the foregoing reasons;
IT IS ORDERED that the Motion for Summary Judgment (Rec. Doc. 36)
filed by defendant State Farm Fire and Casualty Co. is GRANTED;
IT IS FURTHER ORDERED that Plaintiffs will be given 30 days from entry of
this Order and Reasons to move for reconsideration by making the detailed and proper
showing required by Louisiana law, if they can. The Court will withhold entry of a final
judgment during this 30 day period.
April 30, 2014
JAY C. ZAINEY
UNITED STATES DISTRICT JUDGE
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