Cupps et al v. Torus Specialty Insurance Company et al

Filing 47

ORDER AND REASONS granting 45 MOTION for Summary Judgment filed by Torus Specialty Insurance Company. Plaintiffs' claims against Defendant Torus Specialty Insurance Company are DISMISSED WITH PREJUDICE. Signed by Judge Jane Triche Milazzo on June 15, 2015.(ecm) Modified document type on 6/16/2015 (ecm).

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
DELLA CUPPS, ET AL.

CIVIL ACTION

VERSUS

NO. 14-615

TORUS SPECIALTY INSURANCE CO., ET AL.

SECTION "H"

ORDER AND REASONS
Before the Court is Defendant Torus Specialty Insurance Company’s
(“Torus”) unopposed Motion for Summary Judgment (R. Doc. 45). For the
following reasons, Defendant’s Motion is GRANTED, and Plaintiffs’ claims
against Torus are DISMISSED WITH PREJUDICE.
BACKGROUND
This is an action for legal malpractice. Plaintiffs, the relatives of David
Cupps, claim that Defendants were negligent in their representation of Plaintiffs
in the wrongful death action of Mr. Cupps. The deceased, an Ohio resident, was
allegedly kidnapped and murdered by two men who had escaped from the
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custody of the Louisiana Department of Corrections. After Mr. Cupps's murder,
Plaintiffs retained a Missouri law firm to represent them in a wrongful death
claim. The Missouri law firm in turn retained Defendants The Cochran Firm,
attorney Darryl Phillips, and Darryl Phillips Attorney at Law, LLC (collectively
"The Phillips Defendants") to serve as local counsel.
The Phillips Defendants filed two lawsuits on behalf of Plaintiffs. The
first, filed in the Middle District of Louisiana, was dismissed for lack of subject
matter jurisdiction on May 24, 2013. Proper service was not made on the
defendants in the Middle District Litigation, so prescription was never
interrupted by the filing of that suit. On August 20, 2012, more than one year
after the anniversary of Mr. Cupp’s death, the Phillips Defendants filed a
lawsuit in the Nineteenth Judicial District Court for the Parish of East Baton
Rouge on behalf of Plaintiffs. On November 5, 2013, this lawsuit was dismissed
on res judicata and lis pendens grounds. The next day, a representative of
Plaintiffs notified the Phillips Defendants that the dismissal may have resulted
from their professional negligence in filing the petition untimely.
Defendant Torus issued a Lawyer’s Professional Responsibility Policy (the
“Policy”) with a policy period of January 26, 2012 to January 26, 2013 to
Defendant The Cochran Firm (“TCF”) as the named insured. The Policy was the
last of any kind issued by Torus to TCF or any of the Phillips Defendants. TCF
did not renew the Policy after it expired, and no additional Torus policy was
issued. Furthermore, no extended reporting period was purchased under the
Policy on behalf of TCF or any of the Phillips Defendants.
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On February 3, 2014, Plaintiffs brought suit against the Phillips
Defendants and Torus for their negligence in handling the wrongful death claim
arising out of Mr. Cupps's death. Torus now moves this Court for summary
judgment on all of Plaintiffs’ claims against it. Although Plaintiffs have not filed
an opposition to this Motion, the Court may not simply grant the instant Motion
as unopposed. The Fifth Circuit approaches the automatic grant of dispositive
motions with considerable aversion.1

Indeed, on a motion for summary

judgment, the moving party still “has the burden of establishing that there is no
genuine dispute of material fact; and, unless that party does so, a court may not
grant the motion, regardless [of] whether any response is filed.”2 In this District,
the failure to file an opposition requires the Court to deem the moving party's
statements of uncontested material facts admitted.3 Nonetheless, the moving
party must still make a prima facie showing of its entitlement to judgment.4
LEGAL STANDARD
Summary judgment is appropriate "if the pleadings, depositions, answers
to interrogatories, and admissions on file, together with affidavits, if any, show
that there is no genuine issue as to any material fact and that the moving party
1

See, e.g., Servicios Azucareros de Venezuela, C.A. v. John Deere Thibodeaux, Inc., 702
F.3d 794, 806 (5th Cir. 2012); Johnson v. Pettiford, 442 F.3d 917, 918 (5th Cir. 2006) (per
curiam); John v. State of Louisiana (Bd. of Trs. for State Colls. and Univs.), 757 F.2d 698, 709
(5th Cir. 1985).
2

Davis–Lynch, Inc. v. Moreno, 667 F.3d 539, 550 (5th Cir. 2012) (citing Hibernia Nat'l
Bank v. Admin. Cent. Sociedad Anonima, 776 F.2d 1277, 1279 (5th Cir. 1985)).
3

See L.R. 56.2.

4

See Eversley v. Mbank Dallas, 843 F.2d 172, 174 (5th Cir. 1999).

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is entitled to a judgment as a matter of law."5 A genuine issue of fact exists only
"if the evidence is such that a reasonable jury could return a verdict for the
nonmoving party."6
In determining whether the movant is entitled to summary judgment, the
Court views facts in the light most favorable to the non-movant and draws all
reasonable inferences in his favor.7 "If the moving party meets the initial burden
of showing that there is no genuine issue of material fact, the burden shifts to
the non-moving party to produce evidence or designate specific facts showing the
existence of a genuine issue for trial."8 Summary judgment is appropriate if the
non-movant "fails to make a showing sufficient to establish the existence of an
element essential to that party’s case."9 "In response to a properly supported
motion for summary judgment, the non-movant must identify specific evidence
in the record and articulate the manner in which that evidence supports that
party’s claim, and such evidence must be sufficient to sustain a finding in favor
of the non-movant on all issues as to which the non-movant would bear the
burden of proof at trial."10 "We do not . . . in the absence of any proof, assume
that the nonmoving party could or would prove the necessary facts."11
5

Fed. R. Civ. P. 56(c) (2012).

6

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

7

Coleman v. Houston Indep. Sch. Dist., 113 F.3d 528 (5th Cir. 1997).

8

Engstrom v. First Nat’l Bank of Eagle Lake, 47 F.3d 1459, 1462 (5th Cir. 1995).

9

Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986).

10

John v. Deep E. Tex. Reg. Narcotics Trafficking Task Force, 379 F.3d 293, 301 (5th Cir.
2004) (internal citations omitted).
11

Badon v. R J R Nabisco, Inc., 224 F.3d 382, 394 (5th Cir. 2000) (quoting Little v.
Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994)).

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Additionally, "[t]he mere argued existence of a factual dispute will not defeat an
otherwise properly supported motion."12
LAW AND ANALYSIS
Although insurance policies "are executed for the benefit of all injured
persons," such protection is limited "by the terms and limits of the policy."13 The
statute governing limitations on an insurer's ability to contract does not
mandate coverage where none exists.14 The Policy issued by Torus to TCF
includes a Lawyers Professional Liability Insurance coverage section and is a
"claims-made-and-reported" policy. It contains the following language:
The Company shall pay on behalf of any INSURED all DAMAGES
in excess of the deductible which any INSURED becomes legally
obligated to pay as a result of CLAIMS first made against any
INSURED during the POLICY PERIOD [January 26, 2012 to
January 26, 2013] and reported to the Company in writing during
the POLICY PERIOD or within sixty (60) days thereafter, by reason
of any WRONGFUL ACT occurring on or after the RETROACTIVE
DATE, if any.
Accordingly, three prerequisites are required to be met under the Policy in order
for Torus to provide coverage: (1) the demand must be made upon the insured
during the policy period, (2) the claim must be reported to Torus in writing
within sixty days of the expiration of the policy period, and (3) the wrongful act
must have occurred on or after the retroactive date, if any.
12

Boudreaux v. Banctec, Inc., 366 F. Supp. 2d 425, 430 (E.D. La. 2005).

13

Gorman v. City of Opelousas, 148 So. 3d 888, 897 (citing
22:1269(B)(1) & (D)).
14

Id. at 897.

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La. Rev. Stat. §

On January 13, 2014, Torus received its first notice of Plaintiffs' potential
legal malpractice claim. On that date, Plaintiffs notified Torus in writing of
their potential legal malpractice claim against TCF and/or the Phillips
Defendants and against Torus as their professional liability carrier. Plaintiffs
filed the instant lawsuit on February 3, 2014.15

Because the policy period

expired on January 26, 2013, Torus did not receive notice of Plaintiffs' claim
until well after the sixty-day notice period required under the Policy had passed.
Under Louisiana law, the rights of injured parties under claims-made
insurance policies do not vest at the time of injury but at the time the claim is
made.16 Likewise, the purpose of the reporting requirement in a claims-made
policy is to define the scope of coverage purchased by the insured by providing
a certain date after which an insurer knows it is no longer liable under the
policy.17 Failure to make a claim and report it during the policy period in effect
at the time of injury precludes coverage for the third party’s injury.18
Under the Policy at issue, coverage extended only to claims reported in
writing to Torus within sixty days of the January 26, 2013 policy expiration date.
However, it is undisputed that Plaintiffs did not notify the Phillips Defendants
of their potential claim until November 6, 2013, and Torus was not notified until
15

This suit was originally filed in the Civil District Court for the Parish of Orleans.
Torus removed this matter to federal court on diversity grounds after the Phillips Defendants
were dismissed on account of their bankruptcy filings.
16

Resolution Trust Corp. v. Ayo, 31 F.3d 285, 293 (5th Cir. 1994).

17

Id. at 289. Insurance companies may limit their liability through clear and
unambiguous notice provisions. Id.
18

Gorman, 148 So. 3d at 898.

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January 13, 2014—long after the Policy had expired and the applicable reporting
period had closed. Thus, Plaintiffs’ legal malpractice claim was neither made
nor reported to Torus in writing within the applicable period required by the
Policy.

Accordingly, Plaintiffs' claim does not meet the prerequisites for

coverage required by Torus's Policy with TCF, and their claims against Torus
are therefore dismissed with prejudice.
CONCLUSION
For the foregoing reasons, Defendant’s Motion is GRANTED. Plaintiffs'
claims against Defendant Torus Specialty Insurance Company are DISMISSED
WITH PREJUDICE.

New Orleans, Louisiana, this 15th day of June, 2015.

___________________________________
JANE TRICHE MILAZZO
UNITED STATES DISTRICT JUDGE

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