United States District Court, E.D. Louisiana
ORDER AND REASONS
L. C. FELDMAN UNITED STATES DISTRICT JUDGE.
the Court is the defendant's motion for partial summary
judgment that California law governs the plaintiff's
uninsured motorist claim, and, therefore, the plaintiff's
claims for statutory penalties and attorney's fees under
La. R.S. §§ 22:1892 and/or 22:1973 must be
dismissed with prejudice. For the reasons that follow, the
motion is DENIED.
lawsuit arises from a hit-and-run motor vehicle accident and
the victim's efforts to recover from her insurance
Metriz Lewis is a retired nurse who spends part of the year
at her residence in Louisiana and the other part at her home
in California where her daughter continues to reside. On
November 9, 2017, Lewis was driving her 2015 Jeep Wrangler in
New Orleans when a sedan violently struck her vehicle,
causing it to flip onto the driver's side. Upon impact,
the driver of the sedan fled the scene. Immediately
thereafter, Lewis was transported to the emergency room by
ambulance where she was treated for head, neck, and back pain
and admitted for overnight observation. She also was required
to wear a cervical collar for several months and remains
under the care of two treating physicians in New Orleans.
the accident, Lewis submitted a claim to
21stCentury Insurance Company for uninsured
motorist (“UM”) benefits under her personal
automobile policy. In hopes of resolving the matter, Lewis
presented 21st Century with an Offer of Settlement
and Satisfactory Proof of Loss, but the offer was rejected.
Believing the hit-and-run driver to be at fault, and
believing that 21st Century had acted in bad faith
in handling her claim, Lewis filed suit in Louisiana state
court on April 3, 2018 to recover damages resulting from the
accident, as well as statutory penalties and attorney's
fees. 21st Century timely removed the action to
this Court, invoking the Court's diversity jurisdiction.
months later, Lewis presented 21st Century with a
second Offer of Settlement and Satisfactory Proof of Loss, in
which she alleged that the value of her damages exceeds the
policy limits of $100, 000. 21st Century, through
counsel, rejected that offer, stating:
[G]iven that this is a California policy, California law will
apply. And under these circumstances, a tender is not
required and further investigation is necessary. Once
additional discovery is completed, 21stCentury
Insurance Company will reevaluate their position regarding
your client's claims.
21st Century now moves for partial summary
judgment that California law governs the plaintiff's UM
claim, such that her claims for statutory penalties and
attorney's fees under La. R.S. §§ 22:1892
and/or 22:1973 must be dismissed with prejudice.
Rule of Civil Procedure 56 instructs that summary judgment is
proper if the record discloses no genuine dispute as to any
material fact such that the moving party is entitled to
judgment as a matter of law. No. genuine dispute of fact
exists if the record taken as a whole could not lead a
rational trier of fact to find for the non-moving party.
See Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 587 (1986). A genuine dispute of
fact exists only “if the evidence is such that a
reasonable jury could return a verdict for the non-moving
party.” Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248 (1986).
mere argued existence of a factual dispute does not defeat an
otherwise properly supported motion. See id. In this
regard, the non-moving party must do more than simply deny
the allegations raised by the moving party. See Donaghey
v. Ocean Drilling & Exploration Co., 974 F.2d 646,
649 (5th Cir. 1992). Rather, he must come forward with
competent evidence, such as affidavits or depositions, to
buttress his claims. Id. Hearsay evidence and
unsworn documents that cannot be presented in a form that
would be admissible in evidence at trial do not qualify as
competent opposing evidence. Martin v. John W. Stone Oil
Distrib., Inc., 819 F.2d 547, 549 (5th Cir. 1987);
Fed.R.Civ.P. 56(c)(2). “[T]he nonmoving party cannot
defeat summary judgment with conclusory allegations,
unsubstantiated assertions, or only a scintilla of
evidence.” Hathaway v. Bazany, 507 F.3d 312,
319 (5th Cir. 2007) (internal quotation marks and citation
omitted). Ultimately, “[i]f the evidence is merely
colorable . . . or is not significantly probative, ”
summary judgment is appropriate. Anderson, 477 U.S.
at 249 (citations omitted); King v. Dogan, 31 F.3d
344, 346 (5th Cir. 1994) (“Unauthenticated documents
are improper as summary judgment evidence.”).
judgment is also proper if the party opposing the motion
fails to establish an essential element of his case. See
Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).
In deciding whether a fact issue exists, courts must view the
facts and draw reasonable inferences in the light most
favorable to the non-moving party. Scott v. Harris,
550 U.S. 372, 378 (2007). Although the Court must
“resolve factual controversies in favor of the
nonmoving party, ” it must do so “only where
there is an actual controversy, that is, when both parties
have submitted evidence of contradictory facts.”
Antoine v. First Student, Inc., 713 F.3d 824, 830
(5th Cir. 2013) (internal quotation marks and citation
Court, sitting in diversity, must apply Louisiana's
choice-of-law rules in determining which state's
substantive law governs this dispute. See Abraham v.
State Farm Mutual Auto Ins. Co., 465 F.3d 609, 611 (5th
Cir. 2006). The Louisiana Supreme Court has offered guidance
as to the appropriate choice-of-law analysis for insurance
disputes arising out of automobile accidents and concerning
contacts with more than one state. In Champagne v.
Ward, Louisiana's high court resolved a circuit
split amongst the state's appellate courts, holding that
Louisiana's uninsured/underinsured motorist law does not
automatically apply to accidents occurring in
Louisiana and involving a Louisiana resident. 03-3211 (La.
1/19/05); 893 So.2d 773. Rather, the Champagne court
determined, where the uninsured motorist laws of Louisiana
and the foreign state differ, a choice-of-law analysis as
codified in the Louisiana Civil Code must be performed.
Id. at 786.
case, it is undisputed that the uninsured motorist laws of
Louisiana and California differ in significant respects.
Louisiana law requires an insurer to tender the undisputed
amount of a claim within a fixed period of time and permits
penalties and attorney's fees in the absence of tender,
while California law does not require tender and mandates
binding arbitration of disputes concerning the uninsured
driver's liability and the extent of the resulting
damages. Compare McDill v. Utica Mutual Ins. Co.,
475 So.2d 1085, 1091 (La. 1985) (“If . . . the insured
has made a showing that the insurer will be liable for some
general damages, the insurer must tender the reasonable
amount which is due.”) with Rangel v.
Interinsurance Exch., 842 P.2d 82, 91 (Cal. 1992)
(“[P]ayment may be delayed until the amount of the loss
payable has been determined in arbitration.”).
Louisiana law, La. R.S. § 22:1892(B)(1) and La. R.S.
§ 22:1973(B)(5) and (C) provide for penalties against an
insurer whose failure to pay a claim after receiving
satisfactory proof of loss is “arbitrary, capricious,
or without probable cause.” Although the statutes
differ in the time periods allowed for payment, both are
“penal in nature and must be strictly construed.”
Reed v. State Farm Mut. Auto Ins. Co., 2003-0107
(La. 10/21/03), 857 So.2d 1012, 1020. Upon the insurer's
receipt of satisfactory proof of loss, La. R.S. §
22:1892 requires payment within thirty days, subject to a
mandatory penalty of fifty percent of the amount due, as well
as reasonable attorney's fees and costs, whereas La. R.S.
§ 22:1973(B)(5) and (C) requires payment within sixty
days, subject to a discretionary penalty of no more than two
times the damages sustained. In the context of an uninsured
motorist claim, “satisfactory proof of loss”
constitutes sufficient facts to fully apprise the insurer:
(1) that “the owner or operator of the other vehicle
involved in the accident was uninsured or underinsured; (2)
that he was at fault; (3) that such fault gave rise to
damages; and (4) [of] the extent of those damages.”
McDill, 475 So.2d at 1089. Once these criteria are
met, “the insurer must tender the reasonable amount
which is due, ” even if “the insured in unable to
prove the exact extent of his general
damages.” Id. at 1091.
law, on the other hand, does not require tender when the
insurer and insured cannot agree on the extent of the
damages. See Aronson v. State Farm Ins. Co., No.
99-4074, 2000 U.S. Dist. LEXIS 6976, at *25 (C.D. Cal. May
15, 2000); Bouton (Lloyd) v. USAA Casualty Ins. Co.
(2008) 43 Cal.4th 1190, 1193. Title 10, California Code of
Regulations, Section 2695.7(h) provides, in part, that an
insurer, “[u]pon acceptance of the claim in whole or in
part . . . shall immediately, but in no event more than
thirty (30) calendar days later, tender payment or otherwise
take action to perform its claim obligation.” However,
California Insurance Code § 11580.2(f) clarifies that
“the determination as to whether the insured shall be
legally entitled to recover damages, and if so entitled, the
amount thereof, shall be made by agreement between the
insured and the insurer or, in the event of disagreement, by
arbitration.” (emphasis added).
Section 11580.2(i), in turn, provides:
(1) No cause of action shall accrue to the
insured under any policy or endorsement provision
issued pursuant to this section unless one of the
following actions have been taken within ...