Justia U.S. 5th Circuit Court of Appeals Opinion Summaries

Appellant filed suit in the 9th District Court for Montgomery County, Texas, against defendants, alleging claims of negligence resulting in personal injury in the course of her treatment while pregnant. Plaintiff appealed from the decision of the district court dismissing the case after (1) refusing to remand her state court medical negligence claim against two purportedly federally-affiliated doctors, (2) vacating her state court default judgment, and (3) substituting the United States as a defendant. The court agreed with appellant that the finality of the state court judgment at the time of removal made removal improper on these facts. Therefore, the court vacated the September 29, 2010 judgment and rendered a judgment of dismissal for want of jurisdiction in the federal district court.

In this design defect case, Hyundai appealed a jury verdict in favor of plaintiffs after their daughter sustained fatal injuries in an automobile accident. At issue was whether there was sufficient evidence for a reasonable jury to have found that a design defect in the front passenger seat and the restraint system was the producing cause of the daughter's injuries. The court held that the facts and inferences in this case did not point so overwhelmingly in favor of Hyundai such that any reasonable jury would have been obligated to reach a verdict in it's favor. Accordingly, the court applied the deferential standard of review required when examining jury verdicts and affirmed the judgment.

Plaintiffs filed suit in district court against the United States, alleging negligence in record-keeping and the administration of a certain life insurance policy. Plaintiffs subsequently appealed from the district court's order granting the United States' motion to dismiss for lack of subject matter jurisdiction. The court held that plaintiffs did exhaust its administrative remedies, but its claim arose out of a misrepresentation and was barred by the Federal Tort Claims Act (FTCA), 28 U.S.C. 2671.

This case arose when an ocean-going tanker collided with a barge that was being towed on the Mississippi River, which resulted in the barge splitting in half and spilling its cargo of oil into the river. Following the filing of numerous lawsuits, including personal injury claims by the crew members and class actions by fishermen, the primary insurer filed an interpleader action, depositing its policy limits with the court. At issue was the allocations of the interpleader funds as well as the district court's finding that the maritime insurance policy's liability limit included defense costs. The court affirmed the district court's decision that defense costs eroded policy limits but was persuaded that its orders allocating court-held funds among claimants were tentative and produced no appealable order.

This case arose from an oil spill in the Mississippi River when an ocean-going tanker struck a barge that was being towed. Appellants (Excess Insurers) appealed the district court's decision requiring them to pay prejudgment interest on the funds deposited into the court's registry in an interpleader action. The Excess Insurers argued that the district court erred by: (1) finding that coverage under the excess policy was triggered by the primary insurer's filing of an interpleader complaint; (2) holding that a marine insurer that filed an interpleader action and deposited the policy limits with the court was obligated to pay legal interest in excess of the policy limits; and (3) applying the incorrect interest rate and awarding interest from the incorrect date. The court held that because the Excess Insurers' liability had not been triggered at the time the Excess Insurers filed their interpleader complaint, the district court erred in finding that they unreasonably delayed in depositing the policy limit into the court's registry and holding them liable for prejudgment interest. Therefore, the court reversed the judgment and did not reach the remaining issues.

This suit arose out of a dispute between a ship repair contractor, barge owner, and insurance company over the terms of a ship repair service contract and a maritime insurance policy. The contractor appealed from the district court's ruling that that the contractor breached its contractual obligation to procure insurance coverage for the barge owner and that it was contractually obligated to defend and indemnify the barge owner against damages ensuing from a workplace injury that occurred while the barge was being repaired. The barge owner cross-appealed from the district court's ruling that it was not entitled to additional insured coverage under the contractor's insurance policy. The court affirmed the district court's holding that there was a written agreement between the contractor and the barge owner which obligated the contractor to defend, indemnify, and procure insurance for the barge owner. The court also affirmed the district court's holding that the barge owner, which was not named in the policy, was not an additional insured under the policy. The court held, however, that the district court made no ruling regarding attorney's fees and therefore, the court remanded to the district court for a determination of the barge owner's entitlement, if any, to attorney's fees.

Appellants, Peachtree Construction, Ltd. (Peachtree) and Great American Insurance Company (Great American), which was Peachtree's excess liability insurer, appealed the district court's grant of summary judgment in favor of Appellee, Colony Insurance Company (Colony), which was the primary liability insurer to Peachtree and Peachtree's subcontractor (CrossRoads). Great American also appealed the lower court's Fed. R. Civ. P. 12(b)(6) dismissal of its complaint in intervention. At issue was whether, under Texas law, an insurer's duty to indemnify an insured was subordinate to the insurer's duty to defend that insured and whether an excess liability insurer could maintain a subrogation claim against a primary liability insurer after the insured had been fully indemnified. The court held that, in light of D.R. Horton-Texas, Ltd. v. Market Int'l Ins. Co., the district court's summary judgment for Colony was both premature and incorrect where the proffered evidence was more that sufficient to raise a question of fact concerning the existence of a "causal connection relation" between CrossRoads' subcontracted work and the accident in the underlying suit. The court also held that Mid-Continent Ins. Co. v. Liberty Mut. Ins. Co. did not control Great American's contractual subrogation claim against Colony and therefore, the court vacated the district court's Rule 12(b)(6) order that dismissed Great American's complaint in intervention.

The Estate of Mable Dean Bradley (Estate) filed suit against defendants, excess insurers, in federal district court seeking recovery for defendants' alleged bad faith failure to indemnify the Mariner defendants in an underlying state lawsuit and settlement. At issue was whether the district court properly denied the Estate's motion for summary judgment against both insurers, finding as a matter of law that defendants' respective policies did not require them to defend or indemnify Mariner in the lawsuit. The court held that because the actual facts giving rise to liability in the underlying suit occurred outside of defendants' policies, neither excess insurer had a duty to indemnify Mariner for the judgment or settlement in the underlying state suit. Therefore, there could be no breach of denying coverage. The Estate's bad faith action failed as a matter of law. Accordingly, summary judgment was affirmed.

Appellant appealed the district court's summary judgment on her ERISA, 29 U.S.C. 1132(a)(1)(B), claim to recover denied health care benefits and the magistrate judge's decision to limit discovery. At issue was the scope of admissible evidence and permissible discovery in an ERISA action to recover benefits under section 1132(a)(1)(B). The court held that the district court too narrowly defined the scope of discovery where appellant sought to discover evidence that would indicate whether the administrative record was complete, whether Blue Cross complied with ERISA's procedural requirements, and whether Blue Cross previously afforded coverage claims related to the jaw, teeth, or mouth. The court concluded that appellant's discovery request was at least reasonably calculated to lead to the discovery of some admissible evidence and that the district court's abuse of discretion prejudiced appellant's ability to demonstrate that Blue Cross failed to comply with ERISA's procedural requirements. Accordingly, the court vacated and remanded for further proceedings.

Defendant appealed from the district court's award of attorney's fees to plaintiff in a breach of contract and negligence suit where plaintiff hired defendant to investigate land and provide a design that would allow for construction of plaintiff's stores on the site. The parties entered into a geotechnical services contract, which provided that "[e]ach party shall bear its own expenses of litigation," and a testing and inspection contract which included an indemnification clause. At issue was whether, under Mississippi law, the contractual agreement between the parties permitted for an award of attorney's fees, and if so, whether the district court's fee award was an abuse of discretion. Having found that the testing and inspection contract was the only basis for an award of attorney's fees, the court held that the district court's fee award was an abuse of discretion. Accordingly, the court vacated the award of attorney's fees and remanded for further proceedings.