Kiolbassa Provision Co., Inc. v. Travelers Property Casualty Company of America

CourtDistrict Court, W.D. Texas
DecidedAugust 24, 2021
Docket5:20-cv-00507
StatusUnknown

This text of Kiolbassa Provision Co., Inc. v. Travelers Property Casualty Company of America (Kiolbassa Provision Co., Inc. v. Travelers Property Casualty Company of America) is published on Counsel Stack Legal Research, covering District Court, W.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kiolbassa Provision Co., Inc. v. Travelers Property Casualty Company of America, (W.D. Tex. 2021).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION

KIOLBASSA PROVISION CO., INC., § § Plaintiff, § SA-20-CV-00507-FB § vs. § § TRAVELERS PROPERTY CASUALTY § COMPANY OF AMERICA, § § Defendant. §

REPORT AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE To the Honorable United States District Judge Fred Biery: This Report and Recommendation concerns Defendant Travelers Property Casualty Company of America’s Motion for Summary Judgment [#17]. All pretrial matters in this case have been referred to the undersigned for disposition pursuant to Western District of Texas Local Rule CV-72 and Appendix C [#21], and the undersigned has authority to enter a recommendation as to Defendant’s Motion for Summary Judgment pursuant to 28 U.S.C. § 636(b)(1)(B). In reviewing Defendant’s motion, the undersigned has considered Plaintiff’s Response [#18], and Defendant’s Reply [#20], as well as Defendant’s Objections to Plaintiff’s summary judgment evidence [#19], and the reply [#22] and response [#23] thereto. Having considered these written filings, the record in this case, and the governing law, the undersigned recommends that Defendant’s Motion for Summary Judgment [#17] be granted. I. Background The instant case involves an insurance contract dispute between the insured Plaintiff Kiolbassa Provision Company and the insurer Defendant Travelers Property Casualty Company of America. This case was removed from state court on April 24, 2020. (Notice of Removal [#1].) Plaintiff owns and operates a smoked meat business. (Compl. [#1-6] ¶ 8.) Plaintiff alleges that on August 7, 2019, Plaintiff placed 49,016 pounds of beef (“Product”) in a refrigerated trailer, which the parties call a “reefer trailer,” located at Plaintiff’s business to be stored for later processing. (Compl. [#1-6] ¶ 11; MSJ Resp. [#18], at 3.) On or about August 10,

2019, Plaintiff removed the Product from the reefer trailer to discover that all of the Product had spoiled due to lack of refrigeration. (Compl. [#1-6] ¶ 11.) Plaintiff submitted a claim to Defendant under its policy for “Equipment Breakdown Protection” (“the Policy”) for the full value of the spoiled Product, $167,135.52. (Id. at ¶ 9, 12.) Defendant denied coverage, claiming that the reefer trailer is a “vehicle,” and the breakdown of a vehicle is not covered under the Policy. (Id. ¶ 14.) Plaintiff is suing Defendant for a variety of claims including breach of contract, violations of Chapters 541 and 542 of the Texas Insurance Code, violations of the Texas Deceptive Trade Practices Act, and breach of the common law duty of good faith and fair

dealing. (Compl. [#1-6] ¶¶ 27–38.) Defendant now moves for summary judgment in its favor on all of Plaintiff’s claims. II. Summary Judgment Standard Summary judgment is appropriate under Rule 56 of the Federal Rules of Civil Procedure only “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); see also Fed. R. Civ. P. 56(c). A dispute is genuine only if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The party moving for summary judgment bears the initial burden of “informing the district court of the basis for its motion, and identifying those portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp., 477 U.S. at

323. Once the movant carries its burden, the burden shifts to the nonmoving party to establish the existence of a genuine issue for trial. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Wise v. E.I. Dupont de Nemours & Co., 58 F.3d 193, 195 (5th Cir. 1995). The non-movant must respond to the motion by setting forth particular facts indicating that there is a genuine issue for trial. Miss. River Basin Alliance v. Westphal, 230 F.3d 170, 174 (5th Cir. 2000). The parties may satisfy their respective burdens by tendering depositions, affidavits, and other competent evidence. Topalian v. Ehrman, 954 F.2d 1125, 1131 (5th Cir. 1992). The Court will view the summary judgment evidence in the light most favorable to the non-movant. Rosado v. Deters, 5 F.3d 119, 123 (5th Cir. 1993). “After the non-movant

has been given the opportunity to raise a genuine factual issue, if no reasonable juror could find for the non-movant, summary judgment will be granted.” Westphal, 230 F.3d at 174. III. Summary Judgment Record Construing the evidence most favorably to the non-movant Plaintiff, the summary judgment record establishes the following: It is undisputed that Defendant issued a policy of insurance to Plaintiff which contained “EnergyMax 21 Equipment Breakdown Protection” form EBT1000808, effective September 9, 2018 to September 9, 2019. (Policy [#17-1], at 4.) The Policy provided coverage for direct damage caused by a “Covered Cause of Loss” to “Covered Property” located at the Covered Premises. (Id. at 20.) A “Covered Cause of Loss” is a “Breakdown” to “Covered Equipment.” (Id.) A “Breakdown” is defined as the following direct physical loss that causes physical damage to “Covered Equipment” and necessitates its repair or replacement: (1) electrical failure including arcing; (2) failure of pressure or vacuum equipment; or (3) mechanical failure including rupture or bursting caused by centrifugal force. (Id. at 39.) “Covered Equipment”

means any electrical or mechanical equipment that is used in the generation, transmission, or utilization of energy. (Id.) And the provision critical to resolving the summary-judgment motion states that “Covered Equipment” does not mean any vehicle, aircraft, self-propelled equipment or floating vessel, including any “Covered Equipment” mounted on or used solely with any vehicle, aircraft, self-propelled equipment, or floating vessel. (Id. at 40.) The Policy includes a Spoilage Damage Coverage Extension (SD) of up to $1,000,000. (Id. at 13.) Joshua Wenger, a risk consultant for Defendant, conducted the investigation into Plaintiff’s insurance claim on August 27, 2019. (Claim Investigation [#17-1], at 136.) Wenger

concluded that “the starter for the diesel generator that powers the refrigeration unit suffered a mechanical failure,” and the “failure of the starter caused the refrigeration unit to stop cooling the trailer which caused the spoilage” of the Product. (Id. at 139.) On November 26, 2019, Defendant’s claim professional Ron E. Gest sent a letter to Plaintiff’s Vice President of Organizational Development and Finance Michael Johnson denying coverage under the Policy.

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Bluebook (online)
Kiolbassa Provision Co., Inc. v. Travelers Property Casualty Company of America, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kiolbassa-provision-co-inc-v-travelers-property-casualty-company-of-txwd-2021.