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In re TK Boat Rentals, LLC

United States District Court, E.D. Louisiana

August 7, 2019

IN RE TK BOAT RENTALS, LLC, as owner and operator of the M/V Miss Ida, for exoneration from or limitation of liability

         SECTION M (4)

          ORDER & REASONS

          BARRY W. ASHE UNITED STATES DISTRICT JUDGE.

         Before the Court are the following motions:

(1) the motion of defendants Andre Boudreau and GEICO Marine Insurance Company (“GEICO”) for summary judgment on their crossclaim against defendant Allianz Global Corporate and Specialty Marine Insurance Company (“AGCS”) for insurance coverage.[1]AGCS opposes the motion, [2] Boudreau and GEICO file a reply in support of the motion, [3]and AGCS files a surreply;[4]
(2) AGCS's motion for summary judgment on its crossclaim against GEICO for insurance coverage.[5] GEICO opposes the motion, [6] and AGCS files a reply in support of the motion;[7]
(3) GEICO's motion to strike certain of AGCS's summary judgment exhibits.[8] AGCS opposes the motion, [9] GEICO files a reply in support of the motion, [10] and AGCS files a surreply;[11] and
(4) a motion of Extreme Fishing, LLC (“Extreme Fishing”) for summary judgment on its right to limitation of liability, [12] to which claimants respond in opposition, [13] and in further support of which Extreme Fishing replies.[14]

         Having considered the parties' memoranda and the applicable law, the Court issues this Order & Reasons.

         I. BACKGROUND

         This case arises out of a boating accident. Patrick Beck booked a fishing trip out of Venice, Louisiana, with Extreme Fishing through Troy Wetzel, Extreme Fishing's founder and sole member, [15] for February 12, 2017.[16] Wetzel generally books fishing trips by phone and hires a captain to operate one of the boats that he owns and leases to Extreme Fishing.[17] For Beck's trip, Wetzel hired Boudreau, a licensed captain[18] whom he had observed at work on scores of occasions over the course of three or four years, to captain Wetzel's M/V Kingfish.[19] However, on February II, 2017, the M/V Kingfish became inoperable when its port propeller inexplicably spun off into the marsh on another fishing trip.[20] As a consequence, instead of using the M/V Kingfish for Beck's trip, Wetzel asked whether Boudreau could secure another vessel. Knowing that Chase St. Clair owned a fishing vessel, Boudreau received permission to use the M/V Super Strike for the trip.[21]

         On the morning of February 12, 2017, Boudreau captained the M/V Super Strike for passengers Beck, his minor son, C.D.B., Justin McCarthy, Michael Harrell (collectively, “Plaintiffs”), Tracy Edwards, and Charles “Nick” Siria.[22] Upon leaving the Venice Marina, fog limited visibility to approximately 50 to 75 yards.[23] Boudreau operated boats in similar conditions approximately 15 to 20 times per year.[24] His hired deckhand, Mitchell Rogers, acted as lookout for the trip while Boudreau navigated using radar.[25] Boudreau testified in his deposition that he had expected the fog but that he was not concerned about visibility conditions.[26] The M/V Super Strike's lights were operational and illuminated for the trip.[27]

         To access the Gulf of Mexico, Boudreau planned to leave the Venice Marina, enter the Mississippi River from an area known as “The Jump, ” proceed downriver off the right descending bank (the West Bank), and then cross the river to the East Bank just south of Andres Pond so as to avoid an area of known dredging activity and to exit the river and enter the Gulf through Pass a Loutre.[28] Before crossing the river, the M/V Super Strike's port engine had stalled between four and six times.[29] Boudreau testified that, after the third time, he called St. Clair to inquire about the condition of the engine, but could not reach him.[30] Boudreau further testified that he was able to restart the engine each time after it stalled, [31] and that both engines were operational as he crossed the river.[32] The passengers testified that only the starboard engine was fully operational as they crossed the river.[33]

         As the M/V Super Strike entered the Mississippi River, Boudreau testified that visibility was approximately 20 yards due to fog, and that visibility ranged between 10 and 20 yards throughout the remainder of the voyage.[34] About three-quarters of the way across the river, Boudreau observed an unidentified object appear and then disappear on his radar, which prompted him to reduce his speed.[35] Boudreau then observed another radar contact, what he later learned to be the M/V Miss Ida, proceeding in a westerly direction. Based on the radar signals, Boudreaux believed that the M/V Miss Ida was then crossing the river heading to the West Bank.[36] Boudreaux testified that, by then, he had reduced the speed of the M/V Super Strike to about 20 miles per hour and that visibility was about 15 yards.[37] As Boudreau continued to monitor the radar, he noticed that the M/V Miss Ida was then moving in a northerly, not westerly, direction. Boudreaux testified that he then put the M/V Super Strike in neutral, assuming that the vessels would pass each other starboard-to-starboard (with the M/V Super Strike nearer the East Bank).[38] About 30 seconds later according to Boudreaux's estimate and before he could take evasive action, the M/V Miss Ida collided with the M/V Super Strike, which had drifted with the current about 75 feet.[39] Deckhand Rogers testified, on the other hand, that the M/V Super Strike was in reverse when the M/V Miss Ida broke through the fog within 300 yards of the M/V Super Strike.[40] Boudreau testified that if he would have attempted a port-to-port passing, he believed he would have created a head-on collision.[41] Shane Leblanc, captain of the M/V Miss Ida, testified that he never reduced his speed of 15 to 20 miles per hour from the time he observed the M/V Super Strike on his radar up until the moment of impact, because he assumed each vessel would turn to starboard to effect a port-to-port passing.[42] Toward this end, Leblanc veered his vessel to starboard, but the M/V Miss Ida struck and mounted the starboard bow of the M/V Super Strike at a perpendicular angle.[43] Plaintiffs allege they sustained serious injuries as a result of the accident.[44]

         On February 23, 2017, TK Boat Rentals, owner and operator of the M/V Miss Ida, filed a limitation-of-liability action related to the accident.[45] On March 24, 2017, Plaintiffs instituted an action for damages against several defendants, including Extreme Fishing, TK Boat Rentals, Wetzel, Boudreau, St. Clair, and GEICO (which Plaintiffs allege was St. Clair's insurer on the date of the collision).[46] On April 19, 2017, St. Clair and Boudreau, owner and operator of the M/V Super Strike, jointly filed a limitation-of-liability action.[47] The two limitation actions and Plaintiffs' suit for damages were consolidated into this action.[48] Plaintiffs eventually added a claim against AGCS, the alleged insurer of Wetzel[49] and Extreme Fishing.[50]

         On February 15, 2018, Boudreau and GEICO filed a crossclaim against AGCS, alleging that AGCS's policy provided coverage to Boudreau for Extreme Fishing's use of St. Clair's vessel.[51] On September 5, 2018, AGCS filed a crossclaim against GEICO, asserting that Extreme Fishing is entitled to coverage under GEICO's policy as the bareboat charterer of the M/V Super Strike, and that AGCS is the excess insurer and entitled to reimbursement from GEICO for all defense costs incurred to date related to the defense of Extreme Fishing.[52] In granting AGCS leave to file its crossclaim against GEICO, the Court noted that it was not then deciding whether AGCS had standing to assert the claim.[53]

         A. The AGCS Policy

         It is undisputed that Wetzel carried an insurance policy issued by AGCS for the M/V Kingfish that was in effect on the date of the collision.[54] The policy defines the term “insured” to include “persons or organizations using the Watercraft with [Wetzel's] prior permission.”[55] The AGCS policy provides additional coverage for a “temporary substitute watercraft” as follows:

2. Temporary Substitute Watercraft - If your Watercraft is out of normal use because of a covered loss, we will cover damages you are legally obligated to pay for bodily injury or property damage arising from the maintenance, use, or control of a temporary substitute Watercraft. The temporary substitute Watercraft must be of a similar type, value, and length as the Watercraft that is out of normal use. But we do not cover temporary substitute Watercraft being used for any purpose other than replacing your Watercraft while it is out of normal use due to a covered loss.[56]

         Based upon the foregoing provisions and the allegations of Plaintiffs' complaint against Boudreau, the Court previously determined that AGCS has a duty to defend Boudreau.[57]

         In the section entitled “General Rules and Conditions, ” the AGCS policy lists several duties of the insured purporting to be preconditions to coverage, [58] including the insured's obligations to report to the insurer any loss or damage within 48 hours after arrival in port, provide notice in writing of the claim within 60 days of the occurrence, and make the watercraft and other damaged property available for AGCS's inspection when reasonably required by AGCS.[59] The AGCS policy also contains an “other insurance” clause that states: “If, at the time of a covered loss or damage, there is any other insurance that would apply to the property in the absence of this policy, the insurance under this policy will only apply as excess insurance over the other insurance.”[60]

         B. The GEICO Policy

         It is also undisputed that St. Clair carried an insurance policy issued by GEICO for the M/V Super Strike that was in effect on the date of the collision.[61] The GEICO policy provides coverage for a bareboat charterer as follows:

While the Insured Boat is under Charter Use, then “you”, “your”, “insured”, and “insured person” are defined as the Named Insured(s) on the Declarations Page and any operator that you designate that holds all required Federal, State, and local licenses and permits. While the insured boat is in service as a Bareboat Charter …, then “you”, “your”, “insured”, and “insured person” also include a charterer operating the insured boat, a licensed captain, a certified instructor, and the Management Company named on this endorsement.
* The definition of Charter Use is deleted in its entirety and replaced with the following:
* is defined as the use of the boat for:
- Bareboat Charters,
- crewed charters carrying six (6) or less passengers for the purpose of charter fishing, sightseeing, or dinner cruises only.
All other Commercial use is excluded.[62]

         Under the policy, the term “bareboat charter” means “a legal bareboat charter as defined by the United States Coast Guard in the Code of Federal Regulations and any applicable endorsement to these regulations.”[63] The Court has previously ruled as a matter of law that Extreme Fishing was the bareboat charterer of the M/V Super Strike at the time of the collision.[64]

         The GEICO policy also contains an “other insurance” clause that states:

If there is any other available insurance that would apply in the absence of this policy, this insurance shall apply as excess over the other insurance. However, with respect to Coverage A and Coverage E, the combined amount of available insurance shall not exceed the applicable limits of this policy for any loss. When this policy and any other policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our policy bears to the total of the limits of all the policies covering on the same basis.
When this insurance is excess, we will have no duty to defend an insured against a claim or suit if any other insurer has a duty to defend an insured against that claim or suit.[65]

         II. PENDING MOTIONS

         A. Insurance Coverage Claims

         Boudreau and GEICO now move for summary judgment against AGCS for insurance coverage under the AGCS policy issued to Wetzel.[66] Boudreau and GEICO contend that the undisputed facts establish that Boudreau and the M/V Super Strike fall within the express terms of the “temporary substitute watercraft” clause.[67] Further, Boudreau and GEICO contend that any coverage GEICO owes to Boudreau is excess to AGCS's coverage under GEICO's “other insurance” clause.[68] In response, AGCS argues that several disputed facts exist to preclude coverage for Boudreau under the “temporary substitute watercraft” clause. AGCS first suggests that GEICO judicially admitted being a co-primary insurer with AGCS in its crossclaim and discovery answers, and, in any event, AGCS's policy excludes primary coverage where other primary insurance exists.[69]

         In AGCS's motion, AGCS seeks summary judgment on its crossclaim that GEICO provides the primary layer of insurance for Extreme Fishing and that AGCS is the excess insurer.[70] GEICO responds that AGCS lacks standing to pursue a coverage claim on behalf of Extreme Fishing because AGCS is not an insured, additional insured, or third-party beneficiary.[71] In reply, AGCS attaches a declaration of Extreme Fishing's attorney that purports to evidence Extreme Fishing's assignment to AGCS of the insured's rights against GEICO for payments made or to be made by AGCS under its policy.[72]

         GEICO moves to strike AGCS's reply as impermissibly asserting a new argument and to strike the exhibits submitted with the reply as incompetent summary judgment evidence.[73] AGCS responds that it had already addressed the assignment-of-rights argument in its original memorandum in support of its motion for summary judgment, but AGCS does not directly address GEICO's contention that the exhibits are inadmissible.[74]

         B. Limitation of Liability

         Extreme Fishing moves for summary judgment on its right to limit its liability. As the bareboat charterer of the M/V Super Strike at the time of the collision, [75] Extreme Fishing contends it has a right to limit its liability under 46 U.S.C. § 30505 because no evidence exists to show that it had privity or knowledge of any of Boudreau's negligent acts in navigation that caused or contributed to the collision.[76] Extreme Fishing summarizes Boudreau's credentials, clean record, and experience in navigating offshore fishing vessels to emphasize that Wetzel, who had observed Boudreau working for several years, chose a competent captain.[77] Furthermore, Extreme Fishing argues that Boudreau was particularly qualified for this trip because he had operated the M/V Super Strike itself on nine other chartered fishing trips with another company.[78] Extreme Fishing invokes prior orders of the Court it claims to have “substantially narrowed” the scope of its potential liability to navigational error.[79] Thus, because the Court dismissed Plaintiffs' claims of unseaworthiness[80] and TK Boat Rentals' claim for Extreme Fishing's negligent entrustment of the vessel to Boudreau, [81] and because no evidence can prove Extreme Fishing's knowledge of Boudreau's negligent navigation, Extreme Fishing contends it is entitled to limit its liability to the post-casualty value of the M/V Super Strike.[82]

         In opposition, Plaintiffs contend that Boudreau's negligence in failing to check for and identify unseaworthy conditions of the M/V Super Strike caused or contributed to the collision. Specifically, Plaintiffs argue that Boudreau's failure to inspect the vessel's engines and Extreme Fishing's failure to enforce a policy of regularly inspecting vessels for such defects contributed to the collision, but never explain how.[83] Plaintiffs also argue that Boudreau's failure to sound his horn in violation of Inland Navigation Rule 34, [84] which addresses maneuvering and warning signals, also contributed to the collision. Plaintiffs point to Boudreau's testimony that he admitted to violating this rule on this occasion and that he had never before removed the horn from the center console to be within his reach in the wheelhouse when operating a vessel.[85] Plaintiffs contend that Wetzel's experience with Boudreau should have given him knowledge of this practice.[86] Nonetheless, Plaintiffs do not contend that the Pennsylvania Rule applies or explain how failure to sound the horn would have prevented the accident in these circumstances.

         Also in opposition to Extreme Fishing's motion to limit its liability, GEICO, Boudreau, and St. Clair briefly argue that “[t]here are issues of fact concerning whether any alleged problems with the port engine were a cause of this collision, ” as would point to Extreme Fishing's knowledge of Boudreau's negligent operation of or failure to inspect the vessel, or Extreme Fishing's own failure to implement inspection policies.[87] In support of this argument, GEICO, Boudreau, and St. Clair cite the deposition testimony of several Plaintiffs who, in contrast to Boudreau and Rogers, contend that only the port engine was operating when the M/V Super Strike crossed the river.[88]

         TK Boat Rentals also opposes Extreme Fishing's motion, re-urging an argument the Court previously rejected in dismissing TK Boat Rentals' negligent entrustment claim. TK Boat Rentals contends that it now presents summary judgment evidence that Extreme Fishing violated 46 U.S.C. § 8104(a) in having Boudreau captain the M/V Super Strike, but points to the same deposition testimony that he slept only about five and a half hours the night before the accident. TK Boat Rentals makes no new argument to support applying the statute to “a small fishing vessel”[89] or to explain how Boudreau's sleeplessness influenced his decisions on the day of the accident.[90]

         In reply, Extreme Fishing argues that, as previously held by the Court, it owes no duty to provide a seaworthy vessel to passengers like Plaintiffs.[91] With regard to its alleged duty to discover purported defects in the M/V Super Strike's engines prior to sailing, Extreme Fishing argues that no respondent to the motion to limit liability has met its burden to show that the condition of the engines caused or contributed to the collision. “Whether or not the port engine on the [M/V Super Strike] was operating properly … is ultimately a red herring because there has been no evidence produced by the opposing parties that the condition of the [M/V Super Strike's] port engine had anything to do with the collision. It is only those acts of negligence or defective conditions aboard the vessel that contribute to the collision that ‘are relevant to determining whether the shipowner is entitled to limitation.'”[92] Extreme Fishing further contends that St. Clair testified the vessel had been recently serviced and in good operating condition, and that TK Boat Rentals' argument regarding Boudreau's sleeplessness should be rejected absent any evidence to demonstrate causation or to rebut Boudreau's specific testimony “that he did not feel tired or fatigued on the morning of the collision.”[93]

         III. LAW & ANALYSIS

         A. Summary Judgment Standard

         Summary judgment is proper “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) (citing Fed.R.Civ.P. 56(c)). “Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which the party will bear the burden of proof at trial.” Id. A party moving for summary judgment bears the initial burden of demonstrating the basis for summary judgment and identifying those portions of the record, discovery, and any affidavits supporting the conclusion that there is no genuine issue of material fact. Id. at 323. If the moving party meets that burden, then the nonmoving party must use evidence cognizable under Rule 56 to demonstrate the existence of a genuine issue of material fact. Id. at 324.

         A genuine issue of material fact exists if a reasonable jury could return a verdict for the nonmoving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1996). The substantive law identifies which facts are material. Id. Material facts are not genuinely disputed when a rational trier of fact could not find for the nonmoving party upon a review of the record taken as a whole. See Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Equal Emp't Opportunity Comm'n v. Simbaki, Ltd., 767 F.3d 475, 481 (5th Cir. 2014). “[U]nsubstantiated assertions, ” “conclusory allegations, ” and merely colorable factual bases are insufficient to defeat a motion for summary judgment. See Anderson, 477 U.S. at 249-50; Hopper v. Frank, 16 F.3d 92, 97 (5th Cir. 1994). In ruling on a summary judgment motion, a court may not resolve credibility issues or weigh evidence. See Delta & Pine Land Co. v. Nationwide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 2008). Furthermore, a court must assess the evidence, review the facts, and draw any appropriate inferences based on the evidence in the light most favorable to the party opposing summary judgment. See Tolan v. Cotton, 572 U.S. 650, 656 (2014); Daniels v. City of Arlington, 246 F.3d 500, 502 (5th Cir. 2001). Yet, a court only draws reasonable inferences in favor of the nonmovant “when there is an actual controversy, that is, when both parties have submitted evidence of contradictory facts.” Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (citing Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 888 (1990)).

         After the movant demonstrates the absence of a genuine dispute, the nonmovant must articulate specific facts and point to supporting, competent evidence that may be presented in a form admissible at trial. See Lynch Props., Inc. v. Potomac Ins. Co. of Ill., 140 F.3d 622, 625 (5th Cir. 1998); Fed.R.Civ.P. 56(c)(1)(A) & (c)(2). Such facts must create more than “some metaphysical doubt as to the material facts.” Matsushita, 475 U.S. at 586. When the movant will bear the burden of proof at trial on the dispositive issue, the movant “must come forward with evidence which would entitle it to a directed verdict if the evidence went uncontroverted at trial.” Int'l Shortstop, Inc. v. Rally's, Inc., 939 F.2d 1257, 1264-65 (5th Cir. 1991) (quotation omitted). Then, the nonmovant may defeat the motion by showing a genuine dispute of material fact or by “showing that the moving party's evidence is so sheer that it may not persuade the reasonable fact-finder to return a verdict in favor of the moving party.” Id. at 1265. When the nonmovant will bear the burden of proof at trial on the dispositive issue, the moving party may simply point to insufficient admissible evidence to establish an essential element of the nonmovant's claim in order to satisfy its summary judgment burden. See Celotex, 477 U.S. at 322-25; Fed.R.Civ.P. 56(c)(B). Unless there is a genuine issue for trial that could support a judgment in favor of the nonmovant, summary judgment must be granted. See Little, 37 F.3d at 1075-76.

         B. Boudreau and GEICO's Motion for Summary Judgment

         1. Boudreau's Coverage Under the AGCS Policy

         Boudreau and GEICO seek primary insurance coverage for Boudreau under the AGCS policy issued to Wetzel for the M/V Kingfish under the “temporary substitute watercraft” clause, which states in pertinent part: “If your Watercraft is out of normal use because of a covered loss, we will cover damages you are legally obligated to pay for bodily injury or property damage arising from the maintenance, use, or control of a temporary substitute Watercraft. The temporary substitute Watercraft must be of a similar type, value, and length as the Watercraft that is out of normal use.”[94] Boudreau and GEICO assert that both conditions for coverage under the temporary substitute watercraft clause in the AGCS policy are satisfied: first, the M/V Kingfish was out of normal service on the date of the collision due to a covered loss; and, second, the M/V Super Strike is of a similar type, value, and length as the M/V Kingfish.[95]

         The qualities of the substitute vessel are genuinely disputed. The AGCS policy requires that a temporary substitute watercraft be of “similar type, value, and length as the Watercraft that is out of normal use.”[96] In support of its argument that the M/V Super Strike was of similar value to the M/V Kingfish, Boudreau and GEICO merely contend that Extreme Fishing charged the Plaintiffs the same amount for the charter of the substitute M/V Super Strike as for the original M/V Kingfish.[97] But, as AGCS points out, the value of the vessels may not be measured by the value of a chartered trip.[98] Extreme Fishing may not have charged Plaintiffs a different rate for a different vessel substituted at the last minute in order to preserve its good business reputation, for example. In addition, AGCS disputes whether Boudreau and GEICO have provided sufficient evidence to demonstrate that the M/V Super Strike was of similar type and length to the M/V Kingfish. Accordingly, summary judgment for Boudreau and GEICO is not warranted at this time on the question of Boudreau's coverage under the “temporary substitute watercraft” clause of the AGCS policy.[99]

         2. GEICO's Primary or Excess Coverage

         Boudreau and GEICO assert that the GEICO policy's “other insurance” clause renders AGCS the primary insurer for Boudreau and GEICO the excess. However, Boudreau and GEICO acknowledge AGCS's competing “other insurance” provision and allege in their crossclaim against AGCS that “[b]oth the [GEICO] and AGCS Policies provide primary coverage to Andre D. Boudreau for the February 12, 2017 incident involving the M/V SUPER STRIKE”[100] AGCS argues that Boudreau and GEICO's unamended pleading and corresponding interrogatory answer, which state that “[GEICO] and AGCS policies provide co-primary coverage for Andre Boudreau operating M/V SUPER STRIKE on February 12th on a 50-50 basis, ”[101] constitute judicial admissions that GEICO is the primary insurer.[102] AGCS also submits that GEICO has waived its coverage defense by assuming continued defense of Boudreau without having reserved its rights against Boudreau.[103] Alternatively, AGCS says that AGCS's “other insurance” clause at least renders GEICO the excess insurer and AGCS's and GEICO's clauses irreconcilable and mutually repugnant, resulting in prorated liability under Louisiana law.[104]

         a. Judicial Admission

          “A judicial admission is a formal concession in the pleadings or stipulations by a party or counsel that is binding on the party making them.” Martinez v. Bally's La., Inc., 244 F.3d 474, 476 (5th Cir. 2001). “A judicial admission ‘has the effect of withdrawing a fact from contention.'” Blankenship v. Buenger, 653 Fed.Appx. 330, 335 (5th Cir. 2016) (quoting Martinez, 244 F.3d at 476) (emphasis in original). Accordingly, judicial admissions generally concern issues of fact and are inapplicable to questions of law. See Blankenship, 653 Fed.Appx. at 335 & n.15. “To qualify as a judicial admission, the statement must be (1) made in a judicial proceeding; (2) contrary to a fact essential to the theory of recovery; (3) deliberate, clear, and unequivocal; (4) such that giving it conclusive effect meets with public policy; and (5) about a fact on which a judgment for the opposing party can be based.” Jonibach Mgmt. Tr. v. Wartburg Enters., Inc., 750 F.3d 486, 491 n.2 (5th Cir. 2014) (quoting Heritage Bank v. Redcom Labs., Inc., 250 F.3d 319, 329 (5th Cir. 2001)). Courts retain discretion to treat statements in briefs as judicial admissions, City Nat'l Bank v. United States, 907 F.2d 536, 544 (5th Cir. 1990), as well as to relieve a party of the binding consequences of its judicial admission where justice requires. See, e.g., Kiln Underwriting, Ltd. v. Jesuit High Sch. of New Orleans, 2008 WL 4724390, at *12 (E.D. La. Oct. 24, 2008) (even if statements were construed as judicial admissions, binding effect waived for counsel's “honest mistake” and lack of prejudice to opposing party).

         AGCS maintains that GEICO has judicially admitted that GEICO is Boudreau's primary insurer through GEICO's unamended crossclaim and interrogatory answer. This is only true if the Court were to accept a crimped reading of GEICO's pleading, which, fairly read, alleges that both GEICO and AGCS are Boudreau's primary insurers. The Court fails to see how such an allegation differs from AGCS's own alternative argument that the irreconcilable and mutually repugnant nature of GEICO's and AGCS's “other insurance” clauses, where each is said to be excess of the other, requires prorated liability under Louisiana law. If true, as a matter of law, both insurers would provide primary coverage to Boudreau, which is precisely what GEICO has alleged. Accordingly, the doctrine of judicial admission is not applicable. See Buenger, 653 Fed.Appx. at 335 n.15 (“The scope of judicial admissions is restricted to matters of fact which otherwise would require evidentiary proof, and does not include counsel's statement of his conception of the legal theory of a case.”) (quoting Glick v. White Motor Co., 458 F.2d 1287, 1291 (3d Cir. 1972)).

         b. Waiver

         AGCS cites Steptore v. Masco Construction Co., 643 So.2d 1213 (La. 1994), for the proposition that GEICO has waived its coverage defense that it is excess because GEICO assumed the defense of Boudreau without obtaining a reservation of rights.[105] AGCS contends that, with GEICO's claim to excess status, GEICO's interests are no longer completely aligned with Boudreau's, so counsel for GEICO and Boudreau has a conflict in the dual representation that is prohibited by Steptore[106] In response, GEICO argues that seeking primary insurance coverage for Boudreau under the AGCS policy is not a “coverage defense” barred by Steptore because GEICO seeks to obtain rather than deny insurance coverage for Boudreau.[107] GEICO cites no law in support of this position but instead claims that more is needed to meet the “high standard of proof to deprive Boudreau of his chosen counsel and show a conflict of interest as defined by Rule 1.7 of the Louisiana Rules of Professional Conduct.[108]

         In Steptore, the Louisiana supreme court precluded an insurer from asserting a coverage defense when the insurer had already assumed defense of the insured without obtaining a reservation of rights or separate counsel. 643 So.2d at 1215, 1217. Six months after the same counsel began representing the insured and the insurer, the insurer denied coverage for the insured due to the insured's breach of a warranty in the policy, and counsel withdrew representation from the insured. Id. The question before the court was whether the insurer had waived its coverage defense. Id. at 1214. The court noted that, under Louisiana law, an insurer is charged with knowledge of the terms of its own policy. Id. at 1216. An insurer also has a duty to investigate facts of which it has notice and which would cause a reasonable person to inquire further, and the insurer's failure to investigate “constitutes a waiver of all powers or privileges which a reasonable search would have uncovered.” Id. Reasoning that these waiver principles must be “applied stringently” to protect against potential conflicts of interests between insurer and insured (and citing Rule 1.7 of the Louisiana Rules of Professional Conduct), the court found the insurer's knowledge of facts that prompted its duty to investigate constituted a waiver of any coverage defenses when the insurer did not obtain a reservation of rights or separate counsel. Id. at 1217. The court reasoned that, from the beginning of litigation, the insurer, attorneys representing the insurer, and the insured had knowledge of the location of the insured's vessel, a fact that would breach the warranty. Id. The insurer's retention of the same counsel to defend it and the insured, without reserving its rights, constituted a waiver of this coverage defense. Id.

         Unlike the warranty in Steptore, the “other insurance” clauses at issue here do not aim to deprive the insured of coverage. Rather, the “other insurance” clauses in the AGCS and GEICO policies merely govern the relationship between the two insurance providers in determining which will cover the insured in what capacity and percentage. See N. Am. Capacity Ins. Co. v. Brister's Thunder Karts, Inc., 2001 WL 766970, at *2-3 (E.D. La. July 9, 2001) (applying Steptore to waive insurer's denial of coverage based upon untimely submission of claim but not to analysis of competing “other insurance” clauses); see also Citgo Petroleum Corp. v. Yeargin, Inc., 690 So.2d 154, 167 (La.App. 1997) (quoting 15 William Shelby McKenzie & Alston Johnson, III, Louisiana Civil Law Treatise, Insurance Law and Practice § 288, at 499 (2d ed. 1996)) (the effect of an excess clause is that “the insurer will have no obligation to pay until the coverage of the other policy or policies has been exhausted”). GEICO's invocation of its “other insurance” clause against AGCS is a “dispute between two insurers” that does not implicate the potential conflicts addressed in Steptore. See Am. Int'l Specialty Lines Ins. Co. v. Canal Indem. Co., 352 F.3d 254, 269-70 (5th Cir. 2010).

         c. GEICO's and AGCS's Competing “Other Insurance” Clauses

         GEICO contends that its “other insurance” clause makes it Boudreau's excess insurer. While GEICO acknowledges that AGCS's “other insurance” clause also purports to make AGCS Boudreau's excess insurer, GEICO points to specific language in the AGCS clause to urge that it does not apply, quoting the following: “If, at the time of a covered loss or damage, there is any other insurance that would apply to the property in the absence of this policy, the insurance under this policy will apply only as excess insurance over the other insurance.”[109] GEICO construes the term “property” as used in AGCS's clause to mean only “the insured watercraft” and not the “temporary substitute watercraft, ” because the term “property” is used only in connection with “the insured watercraft.” As a result, GEICO argues that the AGCS clause applies only when other insurance coverage exists for the M/V Kingfish, as opposed to the M/V Super Strike.[110] Because the GEICO policy covers the M/V Super Strike, not the M/V Kingfish, GEICO says that the AGCS “other insurance” clause does not apply, AGCS is Boudreau's primary insurer under the “temporary substitute watercraft” provision, and GEICO's excess clause can be given effect.[111]

         AGCS denies that the term “property” should be so narrowly construed, urging the Court to employ the ordinary definition of property: “something owned or possessed.”[112] AGCS argues that GEICO's interpretation absurdly creates greater coverage for a temporary substitute vessel than for the insured vessel and thereby renders the “other insurance” clause meaningless.[113] Thus, AGCS argues that the ordinary definition of property it champions conforms with the object of the “other insurance” clause in its policy: namely, to avoid primary coverage where other insurance is available.[114]

         Under Louisiana law, an insurance policy, like any other contract, is construed according to the general rules of contract interpretation set forth in the Louisiana Civil Code. Cadwallader v. Allstate Ins. Co., 848 So.2d 577, 580 (La. 2003) (citations omitted). Contracts are interpreted “to ascertain the common intent of the parties to the contract.” Id. (citations omitted). “Words and phrases used in an insurance policy are to be construed using their plain, ordinary and generally prevailing meaning, unless the words have acquired a technical meaning.” Id. (citations omitted). An insurance policy “should not be interpreted in an unreasonable or strained manner under the guise of contractual interpretation to enlarge or to restrict its provisions beyond what is reasonably contemplated by unambiguous terms or achieve an absurd conclusion.” Id. (citations omitted). A court cannot exercise “inventive powers to create an ambiguity where none exists or the making of a new contract when the terms express with sufficient clearness the parties' intent.” Id. (citations omitted). Thus, clear and unambiguous policy wording that expresses the parties' intent is enforced as written. Id.

         On the other hand, ambiguous provisions and “equivocal provisions seeking to narrow an insurer's obligation” are strictly construed against the insurer and in favor of coverage. Id. (citations omitted). However, the rule of strict construction applies only if the ambiguous policy provision is susceptible to more than one reasonable interpretation. Id. (citations omitted). “The determination of whether a contract is clear or ambiguous is a question of law.” Id. (citation omitted). While the insured has the burden of proving that the circumstances constitute a covered claim, the insurer has the burden of proving that any exclusions apply. Doerr v. Mobil Oil Corp., 774 So.2d 119, 124 (La. 2000).

         The term “property” is not defined by the AGCS policy. Under the general principles of contract interpretation under Louisiana law, then, the Court will use the “ordinary and generally prevailing meaning.” La. Civ. Code art. 2046; Cadwallader, 848 So.2d at 580. The Court must not “create an ambiguity where none exists” where “the terms express with sufficient clearness the parties' intent.” Cadwallader, 848 So.2d at 580 (citations omitted). The ordinary definition of property in this context is “a (usually material) thing belonging to a person, group of persons, etc.; a possession; (as a mass noun) that which one owns; possessions collectively; a person's goods, wealth, etc.” Oxford English Dictionary, “property, n., ” (3d ed. 2007). Unlike the terms “the insured vessel” and “temporary substitute watercraft, ” which are defined and have specific meanings in the policy, the ordinary meaning of “property” includes both vessels involved in this case. Thus, AGCS's excess clause applies when other insurance exists to cover either vessel. This reading makes sense of the “temporary substitute watercraft” provision, where AGCS extends additional coverage to loss related to a vessel other than the specifically-insured vessel and would understandably expect to avoid primary coverage for the substitute vessel where other coverage was in place for it. To interpret the term “property” in the narrow manner suggested by GEICO would “restrict its provisions beyond what is reasonably contemplated by unambiguous terms” and “achieve an absurd conclusion” of providing less coverage to the insured vessel than to a substitute vessel. Cadwallader, 848 So.2d at 580 (citations omitted). Such an interpretation would also prevent the excess clause's application to a substitute vessel, thus frustrating a major purpose of the excess clause. See La. Civ. Code art. 2049 (“A provision susceptible of different meanings must be interpreted with a meaning that renders it effective and not with one that renders it ineffective.”). Thus, the Court agrees with AGCS that the term “property” should have its ordinary meaning, “a thing belonging to a person” or “a possession.” Therefore, under the AGCS excess clause, assuming that the conditions for coverage under the “temporary substitute watercraft” provision can be shown, the M/V Super Strike qualifies as “property, ” and GEICO's policy for the M/V Super Strike would constitute “other insurance.”

         “‘Other insurance' clauses in one policy may or may not be harmonious with the ‘other insurance' clauses contained in another policy or policies providing coverage for a particular claim.” Theriot v. State Farm Mut. Auto. Ins. Co., 2018 WL 2731396, at *3 (La.App. June 6, 2018). There are three basic kinds of other insurance clauses: pro rata, excess, and escape. Citgo Petroleum Corp., 690 So.2d at 167 (quotation omitted). A pro rata clause requires insurers to apportion liability among themselves, usually in proportion to each policy's limits of liability or by contribution of equal shares up to policy limits. Id. An excess clause requires that, when other valid and collectible insurance exists (the primary layer), coverage may only be provided when the limits of the primary layer are exhausted. Id. An escape clause restricts coverage to instances when no other valid and collectible insurance is available. Id.

         In reconciling competing “other insurance” clauses, Louisiana law teaches that courts should attempt to give both clauses effect and find them mutually repugnant if doing so leaves the insured with no coverage. Graves v. Traders & Gen. Ins. Co., 214 So.2d 116, 117 (La. 1968). To enforce conflicting provisions that deprive the insured of coverage “would render all insurance nugatory and produce an absurdity which neither the insured nor the insurers contemplated.” Id. at 118. When clauses are found to be mutually repugnant, Louisiana courts have held each insurer liable in proportion to the policy limits or treated each insurer as the co-primary insurer. See, e.g., Shelter Mut. Ins. Co. v. State Farm Mut. Auto. Ins. Co., 993 So.2d 236, 239 (La.App. 2008) (excess vs. excess); Penton v. Hotho, 601 So.2d 762, 768 (La.App. 1992) (excess vs. pro rata); Dette v. Covington Motors, Inc., 426 So.2d 718, 720 (La.App. 1983) (escape vs. excess); Lamastus & Assoc. v. Gulf Ins. Co., 260 So.2d 83, 86 (La.App. 1972) (excess vs. pro rata). However, Louisiana courts have not established a blanket equitable remedy that would rewrite potentially conflicting provisions; rather, courts adhere to the terms of the policies as written. See Am. Int'l Specialty Lines Ins. Co., 352 F.3d at 265-68.

         Here, AGCS's policy plainly provides an excess clause, as it states: “If, at the time of a covered loss or damage, there is any other insurance that would apply to the property in the absence of this policy, the insurance under this policy will apply only as excess insurance over the other insurance.”[115] GEICO's policy, on the other hand, includes both an excess clause and a pro rata clause:

If there is any other available insurance that would apply in the absence of this policy, this insurance shall apply as excess over the other insurance. However, with respect to Coverage A and Coverage E, the combined amount of available insurance shall not exceed the applicable limits of this policy for any loss. When this policy and any other policy covers on the same basis, either excess or primary, we will pay only our share. Our policy bears to the total of the limits of all the policies covering on the same basis.[116]

         However, GEICO's pro rata clause applies only when other insurance, either excess or primary, covers a loss on the same basis; it does not provide primary coverage. The pro rata rate is further delineated as the proportion of GEICO's policy limits as compared to all other applicable policy limits. Thus, GEICO's pro rata clause applies when GEICO's policy and AGCS's policy extend coverage “on the same basis, either excess or primary.”

         Reading the two “other insurance” clauses together, application of GEICO's excess clause conflicts with AGCS's excess clause, in that each clause purports to make that insurer excess over the other as primary, and thus leaves Boudreau with no primary coverage. As a result, the excess clauses are mutually repugnant and ineffective, and the Court must treat each insurer as co-primary, determining liability from the remaining provisions of the “other insurance” clauses. 15 William Shelby McKenzie & H. Alston Johnson, III, Louisiana Civil Law Treatise: Insurance Law & Practice § 7:19 (4th ed. 2018); Graves, 214 So.2d at 118; see also Gaskin v. Jowers, 775 F.2d 621, 627 (5th Cir. 1985) (after determining excess clauses were incompatible, analyzed compatibility between apportionment clauses). The only remaining verbiage of the “other insurance” clauses here is GEICO's pro rata clause. Application of GEICO's pro rata clause would require GEICO and AGCS to pay in proportion to their policy limits, which is precisely the result under Louisiana law even in the absence of a pro rata clause. Therefore, assuming each policy provides insurance coverage, the Court holds that the excess clauses are mutually repugnant and cancel each other, making GEICO and AGCS co-primary insurers responsible for their pro rata share of the loss.

         C. AGCS's Motion for Summary Judgment

         AGCS seeks summary judgment on its crossclaim that GEICO owes insurance coverage to Extreme Fishing. GEICO raises both procedural and substantive arguments in opposition to the motion.

         1. GEICO's Motion to Strike

         As a preliminary matter, the Court will address GEICO's motion to strike AGCS's reply and attached exhibits filed in support of its motion for summary judgment. GEICO initially argues that the reply and exhibits should be stricken because AGCS impermissibly raises in its reply the “new” argument that Extreme Fishing assigned its rights to AGCS.[117] GEICO is wrong. AGCS briefed its assignment-of-rights theory in its original memorandum in support of the motion for summary judgment.[118]

         GEICO next argues that the exhibits must be stricken because they are not competent evidence to support AGCS's motion for summary judgment.[119] Attacks on the competency of evidence to support a summary judgment motion should be made in an objection under Rule 56(c)(2) of the Federal Rules of Civil Procedure rather than in a motion to strike. See Cutting Underwater Techs. USA, Inc. v. Eni U.S. Operating Co., 671 F.3d 512, 515 (5th Cir. 2012). Nevertheless, the Court will consider GEICO's motion as an objection. See, e.g., Mays v. Bd. of Comm'rs Port of New Orleans, 2015 WL 13529948, at *1-3 (E.D. La. Oct. 22, 2015) (treating motions to strike summary judgment evidence as objections).

         Rule 56(c)(2) permits a party to object to exhibits submitted with a motion for summary judgment when they “cannot be presented in a form that would be admissible in evidence.” The exhibits at issue are (1) emails between counsel for Extreme Fishing and AGCS that discuss Extreme Fishing's assignment of rights to AGCS, [120] and (2) a declaration by Michael McMahon, counsel for Extreme Fishing, confirming the authenticity and content of the emails.[121] GEICO submits that the exhibits “constitute[] double hearsay” because “these emails represent what Extreme Fishing purportedly told its attorney about its acceptance of an offer which was purportedly made by AGCS through its attorney.”[122] GEICO notes that no contract of assignment has been submitted, even though language in the email indicates that “formal documentation of this assignment” ...


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