Broussard v. State Farm Fire & Casualty Co.

523 F.3d 618, 2008 U.S. App. LEXIS 7419, 2008 WL 921699
CourtCourt of Appeals for the Fifth Circuit
DecidedApril 7, 2008
Docket07-60443
StatusPublished
Cited by92 cases

This text of 523 F.3d 618 (Broussard v. State Farm Fire & Casualty Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Broussard v. State Farm Fire & Casualty Co., 523 F.3d 618, 2008 U.S. App. LEXIS 7419, 2008 WL 921699 (5th Cir. 2008).

Opinion

EDITH BROWN CLEMENT, Circuit Judge:

Norman and Genevieve Broussard (“the Broussards”) lost their home during Hurricane Katrina. State Farm Fire and Casualty Co. (“State Farm”) rejected their homeowner’s insurance claim, and the Broussards sued to collect benefits under their policy. The case went to trial and, at the close of all the evidence, the district court granted Judgment as a Matter of Law (“JMOL”) in favor of the Broussards. The jury awarded the Broussards $2.5 million in punitive damages, which the district court remitted to $1 million. State Farm appeals. We reverse the grant of JMOL, vacate the award of punitive damages, and remand for a new trial.

I. FACTS AND PROCEEDINGS

The Broussards’ Biloxi home was completely destroyed during Hurricane Katrina, leaving only the foundation slab. The Broussards, who did not have flood insurance, brought a claim under their State Farm homeowners policy. The State Farm claims adjuster who inspected the site concluded that the “[ejvidence suggests [the] home was more damaged by *623 flood than wind,” and State Farm denied the Broussards’ claim in its entirety.

The Broussards’ homeowners policy contained two types of coverage. They had $90,524 in “named peril” coverage for their personal property, which covered losses caused by a list of perils, including windstorms. They had $120,698 in “open peril” coverage for their dwelling, which covered any “accidental direct loss” to their home. Both the personal property and the dwelling coverage excluded losses caused by water damage. Both coverages were also subject to an “Anti-Concurrent Cause” (“ACC”) clause, which stated:

We do not insure under any coverage for any loss which would not have occurred in the absence of one or more of the following excluded events. We do not insure for such loss regardless of: (a) the cause of the excluded event; or (b) other causes of the loss; or (c) whether other causes acted concurrently or in any sequence with the excluded event to produce the loss ....

It is undisputed that the Broussards’ personal property and dwelling were a total loss and that the value of their personal property and dwelling met or exceeded the policy limits.

After State Farm denied their claim, the Broussards filed suit against State Farm in Mississippi state court. The Broussards claimed breach of contract and bad faith on the part of State Farm and sought the policy limits of their coverage, extra-contractual damages, and punitive damages. State Farm removed the case to the Southern District of Mississippi. The case was tried before a jury in two phases, causation and damage. Following the close of the evidence in the causation phase of the trial, both sides made oral motions for JMOL. The district court granted JMOL in favor of the Broussards on both the personal property and dwelling claims. With regard to the personal property claim, the district court found that the parties had stipulated that the Broussards’ property was destroyed during Hurricane Katrina, that Hurricane Katrina was a “windstorm,” and that State Farm was liable under the “named peril” personal property coverage because “windstorm” was a named peril. With regard to the dwelling claim, the district court held that State Farm bore the burden of proving that the Broussards’ loss was caused by the excluded peril of flooding. The district court noted that State Farm’s expert admitted that he could not distinguish between the wind and water damage to the Broussards’ home with any reasonable degree of probability. In light of this admission, the district court found that “there was no sound evidence upon which the finder of fact could rationally determine that [State Farm] had met its burden of proof’ and entered JMOL for the Brous-sards.

During the damage phase of the trial, the district court gave the jury a punitive damage instruction. The jury awarded the Broussards $2.5 million in punitive damages, which the district court remitted to $1 million.

State Farm appeals the entry of JMOL on both the personal property and dwelling claims and seeks reversal or remittitur of the jury’s punitive damages award. State Farm also appeals the district court’s denial of its motion to strike the testimony of the Broussards’ expert, James Slider, a structural engineer who testified that “wind or a tornado” destroyed the Broussards’ home before the Katrina storm surge arrived. Finally, State Farm appeals the district court’s denial of its motion for change of venue.

II. DISCUSSION

The Broussards argue that their home was destroyed by “tornadie” winds before *624 the Katrina storm surge arrived, and that they are entitled to recover under their homeowners policy for any losses which State Farm cannot show were caused by water, which is an excluded peril under both the personal property and dwelling coverages. This Court has issued several Katrina-related insurance decisions since this case was tried in early 2007, including Tuepker v. State Farm Fire & Casualty Co., a Mississippi slab case interpreting a State Farm homeowners insurance policy whose provisions were identical to the Broussards’ policy in all significant respects. 1 507 F.3d 346, 350-53 (5th Cir.2007); see also Leonard v. Nationwide Mwt. Ins. Co., 499 F.3d 419, 423 (5th Cir.2007) (holding that Nationwide Mutual homeowners insurance policy, which included an ACC clause, was valid and enforceable under Mississippi law). These and other recent Katrina-related cases inform this decision. Because we hold that the district court erred as a matter of law in entering JMOL for the Broussards, we reverse the district court, vacate the award of punitive damages, and remand for a new trial.

A. Judgment as a Matter of Law

The standard of review for rulings on motions for JMOL is de novo. Evans v. Ford Motor Co., 484 F.3d 329, 334 (5th Cir.2007). This Court has held that motions for JMOL should be granted

only if “the facts and inferences point so strongly and overwhelmingly in favor of one party that the Court believes that reasonable men could not arrive at a contrary verdict .... On the other hand, if there is substantial evidence opposed to the motions, that is, evidence of such quality and weight that reasonable and fair-minded men in the exercise of impartial judgment might reach different conclusions, the motions should be denied .... ”

Brown v. Bryan County, 219 F.3d 450, 456 (5th Cir.2000) (internal quotations omitted). When evaluating the district court’s grant of JMOL, we “consider all of the evidence, drawing all reasonable inferences and resolving all credibility determinations in the light most favorable to the non-moving party,” State Farm. Id.

(1) Personal Property “Named Peril” Coverage

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523 F.3d 618, 2008 U.S. App. LEXIS 7419, 2008 WL 921699, Counsel Stack Legal Research, https://law.counselstack.com/opinion/broussard-v-state-farm-fire-casualty-co-ca5-2008.