Reulet v. Lamorak Ins. Co. (M.D. La., Oct. 21, 2022, as to American Insurance)

Our plain-English summary of Reulet v. Lamorak Ins. Co. (U.S. District Court, Middle District of Louisiana, October 21, 2022).

Joanne Reulet and other plaintiffs brought a wrongful death and survival action over the January 2019 death of Kirk Reulet from mesothelioma. They allege he was exposed to asbestos during a 45-year career as a welder in marine-economy jobs. They also allege he was exposed through his father's workplace contact with asbestos products made by Eagle Asbestos. They sued many defendants, including insurers. One was American Insurance Company, alleged to have insured Eagle Asbestos from July 1965 to July 1966. American moved for summary judgment, arguing there was no evidence it ever issued Eagle a policy. The court denied the motion. It pointed to a certificate of insurance, a 2012 affidavit from Eagle's president, and Eagle's discovery responses and admissions in earlier asbestos cases, which said American insured it under a numbered policy. The court held that such prior discovery answers count as competent evidence. It also ordered American's lawyers to show cause why they should not be sanctioned for not disclosing those earlier responses.

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, Middle District of Louisiana
• Decided: October 21, 2022
• Docket: Civil Action No. 20-00404-BAJ-EWD
• Stage: Summary judgment
• State: Louisiana

Outcome. The court denied American Insurance Company's motion for summary judgment on coverage, so the plaintiffs prevailed, and ordered American's counsel to show cause why sanctions should not be imposed.

What the court held. A party's answers to interrogatories and requests for admission, even from earlier lawsuits, are competent summary judgment evidence. Evidence of that kind can create a genuine dispute over whether an insurance policy existed, a point on which the party claiming coverage bears the burden.

Issues decided: Insurance Coverage, Trial Procedure and Discovery.

The people and their exposure

• Kirk Reulet: mesothelioma; died

The defendants

• American Insurance Company (insurer)
• Eagle, Inc., f/k/a Eagle Asbestos & Packing Company, Inc. (manufacturer)

Other decisions in this case

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

• Reulet v. Lamorak Ins. Co. (October 19, 2022). The court granted in part the motion by insurers Wausau and Liberty and stayed the plaintiffs' direct action claims against them pending the Reilly-Benton bankruptcy; the claims were not dismissed.
• Reulet v. Lamorak Ins. Co. (October 21, 2022). The court granted the plaintiffs' motion for partial summary judgment, finding no genuine dispute that Kirk Reulet had mesothelioma and that it resulted in his death, over the opposition of Bayer CropScience, Hopeman Brothers and Liberty Mutual.
• Reulet v. Lamorak Ins. Co. (October 24, 2022). The district court denied Aerojet Rocketdyne's motion for summary judgment, finding fact disputes on whether the decedent was exposed to asbestos at Barnard and Burk and whether Aerojet inherited its liabilities, so plaintiffs and Avondale prevailed on the motion.
• Reulet v. Lamorak Ins. Co. (October 31, 2022). The court denied the summary judgment motions of General Electric and ViacomCBS/Westinghouse, so the plaintiffs' claims against the two turbine manufacturers go forward.
• Reulet v. Lamorak Ins. Co. (October 31, 2022). The court granted in part and denied in part Berkshire's summary judgment motion: claims tied to the second policy period and to the father's second-hand exposure were dismissed with prejudice, while the claim of direct exposure during the first policy period survived for Plaintiffs and Avondale.

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.

JOANNE REULET, ET AL.,

v.

LAMORAK INS. CO., ET AL.

Civil Action No. 20-00404-BAJ-EWD.

October 21, 2022.

United States District Court, M.D. Louisiana.

RULING AND ORDER

BRIAN A. JACKSON, District Judge.

This wrongful death and survival action seeks damages related to the death of Decedent Kirk Reulet in January 2019. Plaintiffs allege that during the course of his 45-year career, Decedent—a welder—worked various marine-economy jobs where he was exposed to asbestos, ultimately causing him to develop terminal mesothelioma. Plaintiffs seek damages from dozens of Defendants—including Decedent's employers, owners of premises where Decedent worked, asbestos manufacturers and distributors, and multiple insurers. (See Doc 95 at ¶¶ 94-95).

Among the insurer Defendants is American Insurance Company ("American"), who is alleged to have insured co-Defendant Eagle, Inc., f/k/a Eagle Asbestos & Packing Company, Inc. ("Eagle Asbestos") during the period July 1, 1965 to July 1, 1966 (the "Policy Period"). Plaintiffs contend that during the Policy Period, Eagle Asbestos manufactured and distributed asbestos-containing products; that, as a consequence of his (Decedent's) father's workplace exposure to these products, Decedent himself was exposed to asbestos fibers; and that, as a result, Decedent ultimately developed mesothelioma. (Doc. 95 at ¶¶ 6,15, 52-54, 73, 88). Plaintiffs seek damages from Eagle Asbestos as an asbestos manufacturer, and, in turn, seek damages from American as Eagle Asbestos's alleged insurer, pursuant to Louisiana's Direct Action Statute, La. R.S. § 22:1269. See Marriner v. Talos Petroleum, LLC, 576 F. Supp. 3d 412, 415 (E.D. La. 2021) (Fallon, J.) ("[T]he Direct Action Statute authorizes a suit directly against the insurer when the insurance contract at issue was written or delivered. . . in the State of Louisiana or if the injury occurred within the state." (quotation marks omitted)).

Now, American moves for summary judgment, asserting that "there is no evidence of American ever issuing a policy to Eagle." (Doc. 307 at p. 1, the "Motion"). Remarkably, American makes this argument while acknowledging: (1) Plaintiffs have produced two copies of a purported Certificate Of Insurance (the "COI") showing that Eagle Asbestos was insured by American during the Policy Period under a Comprehensive General Liability Policy (GL) numbered K-230-9953, (Doc. 307-3); and (2) Eagle Asbestos's President, Fred Schuber, III, submitted a sworn affidavit in 2012 attesting that, as part of its regular business practice, Eagle Asbestos maintained a copy of the COI in its files (Doc. 388-11). American sidesteps this evidence, asserting that the COI is "inherently suspicious," and that Mr. Schuber's affidavit cannot be trusted because it contradicts an earlier (2004) affidavit in which Mr. Schuber stated that Eagle Asbestos was insured by a different insurance provider, American Employers Insurance Company, "from 1959 to 1968." (Doc. 307-1 at pp. 1-2, 21; see 307-6). More remarkable is what American omits from its Motion: specifically, that in June 1998 and again in August 2002, during the course of prior asbestos litigation, Eagle Asbestos responded to interrogatories and specifically stated that it was insured by American during the Policy Period, under GL Policy No. K-230-9953. (See Doc. 388-5 at pp. 3, 43 (Eagle Asbestos's response to Interrogatory No. 4, and "attached Schedule of Insurance"); Doc. 388-6 at pp. 1, 3 (Eagle Asbestos's response to Interrogatory Nos. 1-3, and "attached insurance schedule"). Moreover, in May 2006, in yet another prior asbestos case, Eagle Asbestos responded to requests for admission and specifically admitted the authenticity of the COI. (See Doc. 388-7 at pp. 1, 3 (Eagle Asbestos's response to Request for Admission Nos. 2-3, and attached "Exhibit 1"). And that's not all: Eagle Asbestos's position that it was insured by American during the Policy Period has been consistent since at least August 1986, when Eagle Asbestos's attorney sent a letter to American demanding "indemnification and defense" in yet another asbestos case, attaching the COI as proof of American's coverage. (Doc. 388-8). It is incomprehensible that American was unaware of this evidence at the time it filed its Motion, particularly because the attorney that represented

Eagle Asbestos for purposes of its 1998, 2002, and 2006 discovery responses (Lawrence G. Pugh, III) is the first named partner at the firm representing Defendant BayerCropScience, Inc. in this case (Pugh Accardo, L.L.C.).[1] To withstand summary judgment on the issue of whether American insured Eagle Asbestos during the Policy Period, Plaintiffs must produce evidence establishing a material dispute as to the existence of the underlying American insurance policy. Fed. R. Civ. P. 56(a); see Tunstall v. Stierwald, 2001-1765 (La. 2/26/02), 809 So. 2d 916, 921 ("In an action under an insurance contract, the insured bears the burden of proving the existence of the policy and coverage."). Competent summary judgment evidence obviously includes sworn statements of a party to the case. Competent summary judgment evidence also includes a party's answers to interrogatories and requests for admission, Bradley v. Allstate Ins. Co., 620 F.3d 509, 527 (5th Cir. 2010), even when those answers were offered in a prior proceedings. Marchand v. Asbestos Defendants, 2010-0476 (La. App. 4 Cir. 11/10/10), 52 So. 3d 196, 201 ("Allegations, admissions or confessions in pleadings in another suit are extrajudicial admissions and are admissible as evidence, but are not conclusive presumptions and do not operate as estoppel unless the party invoking them has been prejudiced by relying upon them."), writ denied 2010-2732 (La. 2/11/11), 56 So. 3d 1002; accord Hebert v. Richard, 2015-8 (La. App. 3 Cir. 6/17/15), 166 So. 3d 1265, 1275, writ denied, 2015-1390 (La. 10/2/15), 178 So. 3d 991; Bennett v. Porter, 2010-1088 (La. App. 3 Cir. 3/9/11), 58 So. 3d 663, 669. Here, Plaintiffs have plainly carried their burden to produce competent evidence establishing a genuine contest as to the existence of an underlying insurance policy, particularly in light of Eagle Asbestos's repeated statements in prior litigation that it was insured by American during the Policy Period under GL Policy K-230-9953, and Eagle Asbestos's prior authentication of the COI. Accordingly, Eagle Asbestos's Motion will be denied.

Additionally, based on their apparent lack of candor, and failure to disclose Eagle Asbestos's prior discovery responses in their initial summary judgment papers, counsel for American will be required to show cause why sanctions should not be imposed against them pursuant to Federal Rule of Civil Procedure 11(b), Local Civil Rule 83(b)(6), and Louisiana Professional Conduct Rules 1.1, 1.3, 3.3, 3.4, and 8.4(c).

Accordingly,

IT IS ORDERED that American Insurance Company's Motion For Summary Judgment On Insurance Coverage (Doc. 307) be and is hereby DENIED.

IT IS FURTHER ORDERED that within 7 days of the date of this Order Counsel for American Insurance Company shall SHOW CAUSE why sanctions should not be imposed against them pursuant to Federal Rule of Civil Procedure 11(b), Local Civil Rule 83(b)(6), and/or Louisiana Professional Conduct Rules 1.1, 1.3, 3.3, 3.4, and 8.4(c), based on their apparent lack of candor and failure to disclose Eagle Asbestos's prior discovery responses in their initial summary judgment papers. Counsels' show cause briefing shall be limited to 10 pages.

Upon review of Counsels' show cause briefing, the Court will determine whether to open a separate disciplinary proceeding consistent with the procedural requirements set forth at Local Civil Rule 83(b)(12).

[1] Not surprisingly, neither Eagle Asbestos nor BayerCropScience have offered a position as to American's Motion.

Sources

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