Cortez v. Lamorak Insurance Company (E.D. La., May 11, 2022, summary judgment)

Our plain-English summary of Cortez v. Lamorak Insurance Company (U.S. District Court, Eastern District of Louisiana, May 11, 2022).

Callen Cortez sued about thirty-five defendants, including former employers, manufacturers and insurers, in Louisiana state court. He alleged he contracted mesothelioma from asbestos exposure over his career and from take-home exposure through his father's and brothers' work. The case was removed to federal court. United States Fidelity & Guaranty Company (USF&G) was sued as an alleged insurer of Eagle, Inc. Cortez sought punitive damages under former Louisiana Civil Code article 2315.3, which covered reckless handling of hazardous substances and was in effect from September 1984 to April 1996. USF&G moved for partial summary judgment, and Cortez did not oppose. The court noted that the provision does not apply to conduct before its effective date, and that an insurer is liable only for exposures during its policy period. USF&G's evidence showed its policies with Eagle ran from November 1977 to November 1981, before the provision took effect. The court granted the motion and dismissed the punitive-damages claims against USF&G.

We wrote this summary from the court's opinion with the help of AI. It is not the court's wording, and it is not legal advice. The full opinion is below.

The decision

• Court: U.S. District Court, Eastern District of Louisiana
• Decided: May 11, 2022
• Docket: Civil Action No. 20-2389
• Stage: Summary judgment
• State: Louisiana

Outcome. The court granted insurer USF&G's unopposed motion for partial summary judgment and dismissed plaintiff Callen Cortez's punitive-damages claims against it.

What the court held. Punitive damages under former Louisiana Civil Code article 2315.3 were available only for conduct from September 1984 to April 1996, and an insurer is liable only for exposures during its policy period, so an insurer whose coverage ended before September 1984 cannot be liable for them.

Issues decided: Insurance Coverage, Punitive Damages.

The people and their exposure

• Callen Cortez: mesothelioma

Who	Work	Where	When	Products
Callen Cortez			1984-1996
Callen Cortez	family member of workers; dust brought home

The defendants

• United States Fidelity & Guaranty Company (insurer)
• Eagle, Inc.

Other decisions in this case

Other rulings from the same court in the same case, in our library:

• Cortez v. Lamorak Insurance Co. (November 23, 2020). The court denied Callen Cortez's motion to remand, holding that Avondale (Huntington Ingalls, Lamorak Insurance and Albert Bossier) timely and properly removed the case under the Federal Officer Removal Statute.
• Cortez v. Lamorak Insurance Co. (May 20, 2021). The court granted Lamorak's motion and stayed and administratively closed the whole case until September 12, 2021, over plaintiff Cortez's objection that he needed an expedited trial.
• Cortez v. Lamorak Insurance Company (February 7, 2022). The court denied the Louisiana Insurance Guaranty Association's motion for summary judgment, so plaintiff Callen Cortez's claims arising from the Gabler Insulations insurance coverage go forward.
• Cortez v. Lamorak Insurance Company (April 4, 2022). The court granted Avondale's summary judgment motion in part, dismissing Cortez's tort claims against Avondale as his employer and his intentional-tort claim, but denied it as to his take-home exposure claims against Avondale as his brother's employer.
• Cortez v. Lamorak Insurance Company (April 18, 2022). The court granted plaintiff Callen Cortez's motion for summary judgment that he has mesothelioma and that asbestos caused it, over the defendants' oppositions, while leaving specific causation issues for the jury.
• Cortez v. Lamorak Insurance Company (May 3, 2022). The court granted summary judgment to Entergy, First State, USF&G, Berkshire and Insulations, LLC, granted GE's motion in part (insulation claims) and denied it in part (asbestos gasket claims), and denied Foster Wheeler's motion; it also granted LIGA's motion in limine excluding hearsay.
• Cortez v. Lamorak Insurance Company (May 11, 2022). The district court denied as moot plaintiff Cortez's motion for review of the Magistrate Judge's order allowing Eagle, Inc. to file a supplemental answer, because Eagle's later answer to the third amended complaint made the earlier order irrelevant.
• Cortez v. Lamorak Ins. Co. (May 19, 2022). The court granted Continental Insurance Company's summary judgment motion, holding the LHWCA preempted Cortez's state-law tort claims against it as Halter Marine's insurer and that his intentional-tort claims failed for lack of evidence, and dismissed Continental's two other summary-judgment motions as moot.
• Cortez v. Lamorak Insurance Company (May 19, 2022). The court granted Trinity's summary judgment motion and the motions to dismiss by Continental, Liberty Mutual and Travelers, dismissing with prejudice Albert Bossier's third-party claims because no substitution was made within 90 days after notice of his death.
• Cortez v. Lamorak Ins. Co. (July 8, 2022). The court granted Westinghouse (ViacomCBS) partial summary judgment on claims about asbestos insulation used on its turbines and denied it on claims about asbestos gaskets it supplied or specified for those turbines.
• Cortez v. Lamorak Ins. Co. (July 13, 2022). The court granted Westinghouse (ViacomCBS) partial summary judgment dismissing the failure-to-warn claims, but denied it on the Halter Marine exposure and on whether its FRDM was a substantial factor in causing Cortez's mesothelioma.
• Cortez v. Lamorak Insurance Company (July 18, 2022). The court granted plaintiffs' motion to exclude Danny Joyce's hearsay testimony about Walsh-Healey inspectors, but denied it as to Avondale's expert relying on that testimony, so long as Avondale does not disclose the hearsay to the jury.
• Cortez v. Lamorak Insurance Company (July 20, 2022). The court denied as premature the motion in limine by Foster Wheeler, GE and Westinghouse to exclude plaintiffs' two medical causation experts as cumulative, leaving defendants free to object at trial.
• Cortez v. Lamorak Insurance Company (July 20, 2022). The court granted in part the motion by Eagle and LIGA to limit plaintiffs' industrial hygienist Gerard Baril, barring him from testifying that a supplier who puts its name on an insulation box should legally be considered its manufacturer, and denied the motion otherwise.
• Cortez v. Lamorak Insurance Company (July 25, 2022). The court granted partial summary judgment for Westinghouse (ViacomCBS), General Electric and Foster Wheeler, dismissing the plaintiffs' intentional-tort and fraud claims, and dismissed the punitive-damages part of the motion as moot.
• Cortez v. Lamorak Insurance Company (July 27, 2022). The court denied Goodrich's motion for summary judgment (joined by several co-defendants) on Callen Cortez's claim for loss of personal household services, so plaintiffs kept that claim.
• Cortez v. Lamorak Insurance Company (July 28, 2022). The court granted Travelers' summary judgment motion only on whether B&B was a professional vendor of asbestos (and so on strict products liability) and denied it on negligence duty and breach and on Article 2317 liability, so plaintiffs' other claims continued.
• Cortez v. Lamorak Insurance Company (August 10, 2022). The court granted Hopeman Brothers' motion for partial summary judgment, dismissing the plaintiffs' intentional-tort claims and their claims that Wayne Manufacturing was Hopeman's alter ego or part of a single business enterprise.
• Cortez v. Lamorak Insurance Company (August 16, 2022). The court granted third-party defendant Liberty Mutual's unopposed motion for partial summary judgment, ruling that Wayne Manufacturing was not a professional vendor of asbestos-containing wallboards, against third-party plaintiff Avondale; plaintiffs were found to lack standing to oppose.
• Cortez v. Lamorak Insurance Company (August 23, 2022). The court denied Hopeman Brothers and Liberty Mutual's motion to exclude or limit the testimony of plaintiffs' industrial hygienist Gerald Baril, so the plaintiffs' expert may testify.
• Cortez v. Lamorak Insurance Company (August 29, 2022). The court granted Hopeman Brothers partial summary judgment that it was not a manufacturer of the asbestos wallboards, but denied summary judgment on whether it was a professional vendor, so that question goes to trial against the Cortez plaintiffs and Avondale's opposition.
• Cortez v. Lamorak Insurance Company (September 9, 2022). The court denied Riley Power, Inc.'s motion for summary judgment on the statute of repose and exposure-sufficiency grounds, and denied its motion to strike as moot, so plaintiffs (the Cortez family) prevailed over Riley at this stage.
• Cortez v. Lamorak Insurance Company (September 29, 2022). The court granted in part and denied in part plaintiffs' motion in limine, excluding most of Westinghouse's expert Dr. Forman's testimony on insulation and general Navy requirements but allowing his testimony on shipyard asbestos-safety requirements relevant to the sophisticated-purchaser defense.
• Cortez v. Lamorak Insurance Company (October 4, 2022). The court denied Certain London Market Insurers' motion for partial summary judgment on the plaintiffs' claims arising from Avondale exposures after January 21, 1970, so the plaintiffs prevailed on the motion.
• Cortez v. Lamorak Insurance Company (October 7, 2022). The court granted defendants' motion for partial summary judgment, ruling that plaintiffs could not recover pre-death lost income or pre-death expenses as wrongful death damages.
• Cortez v. Lamorak Insurance Company (October 12, 2022). The court denied plaintiffs' Daubert motion in limine to limit the testimony of Hopeman Brothers' toxicologist, Dr. Brent Finley, so Hopeman prevailed on the motion.
• Cortez v. Lamorak Ins. Co. (October 14, 2022). The court granted plaintiffs' motion to strike eleven defense expert witnesses, including Hopeman Brothers' witness Max Richard, because no expert reports were produced.
• Cortez v. Lamorak Insurance Company (October 24, 2022). The court granted in part and denied in part defendants' omnibus motion in limine, barring terms like "asbestos industry" and the Bair memorandum, while allowing the "asbestos victim" label and lay testimony about dust.
• Cortez v. Lamorak Insurance Company (October 24, 2022). The court granted Travelers Indemnity Company's unopposed motion to quash the plaintiffs' trial subpoena, ruling against the plaintiffs.

Decisions this opinion cites

Earlier decisions in our library that the court cited:

• Cole v. Celotex Corp. (Louisiana Supreme Court, 1992). The Louisiana Supreme Court affirmed the court of appeal: pre-comparative-fault (virile share) law governed, the nine executive officers counted as nine separate shares, and the insurer INA's annual policies could be stacked, so INA owed each of the three plaintiff workers $135,000 plus interest.

The court's opinion

The text below is Google Scholar's copy of the court's opinion, a public record. Numbers in brackets, such as [*921], mark where each page of the printed reporter begins.

CALLEN J. CORTEZ,

v.

LAMORAK INSURANCE COMPANY, ET AL, SECTION "R" (1).

Civil Action No. 20-2389.

May 11, 2022.

United States District Court, E.D. Louisiana.

ORDER AND REASONS

SARAH S. VANCE, District Judge.

On February 24, 2022, defendant United States Fidelity & Guaranty Company ("USF&G") filed a motion for partial summary judgment, seeking dismissal of plaintiff Callen Cortez's punitive-damages claims against it.[1] The motion is unopposed. For the following reasons, the Court grants the motion.

I. BACKGROUND

This is an asbestos exposure case. Plaintiff Callen Cortez alleges that he contracted mesothelioma as a result of exposure to asbestos over the course of his career,[2] as well as take-home exposure resulting from his father's[3] and brothers' work when the family shared a home.[4] On July 1, 2020, plaintiff filed suit in the Civil District Court for the Parish of Orleans against USF&G and approximately thirty-four other defendants, including former employers, manufacturers, and insurance companies.[5] Plaintiff's petition asserts that "[a]ll defendants who are at fault for Mr. Cortez's exposure to asbestos during the years of 1984 through 1996 are liable to petitioner for punitive damages pursuant to Article 2315.3 of the Louisiana Civil Code."[6] On August 31, 2020, the case was removed to federal court.[7]

Defendant USF&G is sued in its capacity as an alleged insurer of Eagle, Inc.[8] USF&G now moves for summary judgment, contending that plaintiff's punitive-damages claims under former article 2315.3 of the Civil Code must be dismissed. Defendant states that this provision, which provided awards for punitive damages for the reckless handling and transportation of hazardous materials, was in effect from September 1984 until April 16, 1996.[9] USF&G asserts that it did not hold a policy of liability insurance with Eagle during this period, and therefore plaintiff cannot recover punitive damages by direct action against USF&G.[10] It therefore seeks dismissal of those claims. The Court considers USF&G's arguments below.

II. DISCUSSION

Summary judgment is warranted when "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc) (per curiam). 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 the evidence in the record is insufficient with respect to an essential element of the nonmoving party's claim. See Celotex, 477 U.S. at 325. The burden then shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. See id. at 324.

The prior version of article 2315.3 of the Civil Code provided that: "In addition to general and special damages, exemplary damages may be awarded, if it is proved that plaintiff's injuries were caused by the defendant's wanton or reckless disregard for public safety in the storage, handling, or transportation of hazardous or toxic substances." Anderson v. Avondale Indus., Inc., 798 So. 2d 93, 96 (La. 2001) (quoting La. Civ. Code art. 2315.3 (repealed by Acts 1996)). This provision was effective from September 3, 1984 until it was repealed on April 16, 1996. Williams v. Asbestos Defendants, 95 So. 3d 497, 503 (La.

App. 4 Cir. 2012), writ denied, 104 So. 3d 430, 430-34 (La. 2012). The Louisiana Supreme Court has held that the provision does not apply retroactively, and that, therefore, punitive damages under this provision are not available for injuries caused by conduct that occurred before September 3, 1984. Anderson, 798 So. 2d at 100-01; see also Arledge v. Holnam, Inc., 957 F. Supp. 822, 827 (M.D. La. 1996) ("Article 2315.3 evaluates the conditions of the legality of conduct. If it were applied to evaluate conduct that occurred before its effective date, it would be retroactive.").

Furthermore, the insurer of an alleged tortfeasor is liable only for harmful exposures that occurred during the insurer's policy period with the tortfeasor. Cole v. Celotex Corp., 599 So. 2d 1058, 1076 (La. 1992). Here, USF&G has submitted evidence indicating that it did not have any liability policies with Eagle during the effective period of former article 2315.3. Specifically, the evidence indicates that USF&G held policies with Eagle from November 1, 1977 until November 1, 1981.[11] Its liability coverage of Eagle thus fully predates the effective date of the punitive-damages provision found in former article 2315.3 of the Louisiana Civil Code. Accordingly, the Court finds that plaintiff may not recover punitive damages from USF&G under this provision.

Plaintiff has not opposed USF&G's motion, and therefore has not pointed to evidence creating an issue of material fact regarding USF&G's liability for punitive damages. Because USF&G has shown that there is no issue of material fact and that it is entitled to judgment as a matter of law, the Court grants its motion for partial summary judgment, and dismisses plaintiff's claims for punitive damages against it. See Fed. R. Civ. P. 56(a); see also Celotex, 477 U.S. at 322-23; Little, 37 F.3d at 1075.

III. CONCLUSION

For the foregoing reasons, USF&G's motion for partial summary[12] judgment is GRANTED. Plaintiff's claims for punitive damages against USF&G are hereby DISMISSED.

[1] R. Doc. 414.

[2] R. Doc. 1-1 at 3-6 (Complaint ¶¶ 3, 8).

[3] Id. at 7-9 (Complaint ¶¶ 11-16).

[4] R. Doc. 149 at 1-2 (Second Amended Complaint ¶¶ 94-95).

[5] R. Doc. 1-1 at 1-3 (Complaint ¶¶ 1-2); id. at 45-48.

[6] Id. at 43 (Complaint ¶ 90).

[7] R. Doc. 1 (Notice of Removal).

[8] R. Doc. 1-1 at 4 (Complaint ¶ 4).

[9] R. Doc. 414-1 at 1.

[10] Id. at 3.

[11] R. Doc. 414-4 at 2 ¶ 5.

[12] R. Doc. 414.

Sources

• The opinion on Google Scholar
• Louisiana asbestos laws
• Louisiana asbestos exposure sites