United States District Court, N.D. Texas, Dallas Division
MEMORANDUM OPINION ORDER
J. BOYLE JUDGE
the Court is Plaintiff's Motion for Summary Judgment.
Doc. 49. For the reasons that follow, the Court
GRANTS the motion.
a breach-of-contract case. In December 2006, Defendant DNIC
Insurance Holdings Inc (DNIH) issued nearly fifteen and a
half million dollars worth of debt securities to U.S. Bank
National Association (Trustee) as trustee of DNIH's
capital trust (Trust). Doc. 56, Def.'s Resp., 2. The
Trust simultaneously issued to its investors fifteen million
dollars of preferred securities. Id. Plaintiff
Alesco Preferred Funding XIV LTD (Alesco) purchased those
preferred securities from the Trust for fifteen million
dollars. Id. In exchange, DNIH promised to return to
Alesco the fifteen-million-dollar principal (the Principal)
plus interest. Id. This transaction occurred
pursuant to a Junior Subordinated Indenture (Indenture).
Id. At issue in this case is the Indenture's
“Significant Subsidiaries” provision. It prevents
DNIH from selling its significant subsidiaries unless the
buyer expressly assumes DNIH's obligation to pay Alesco
in a supplemental indenture, which must be executed at the
sale's closing. Id. at 2-3; see also
Doc. 1-1, Indenture, § 8.1(a).
March 2013, DNIH sold Dallas National Insurance Company
(DNIC), one of DNIH's significant subsidiaries, to
Lonestar Holdco, LLC (Lonestar). Id. at 5. Yet DNIH
and Lonestar did not execute a supplemental indenture
requiring Lonestar to assume DNIH's repayment obligations
before closing. Doc. 50, Pl.'s Br. in Supp., 5; see
also Doc. 1-6, Certificate to Trustee, 2. Instead, DNIH
and Lonestar agreed to execute a supplemental indenture
sometime after the sale. Doc. 56, Def.'s Resp., 5-6. But
they never did. Id.
failure to timely execute a supplemental indenture
constituted a default under the Indenture. Doc. 1-1,
Indenture, § 5.1(c). So on October 5, 2015, Alesco
accelerated DNIH's repayment obligation, making the
Principal and any accrued interest due to Alesco immediately.
Doc. 50, Pl.'s Br. in Supp., 7. DNIH did not pay Alesco,
so in March 2016, Alesco filed this breach-of-contract
lawsuit to recover from DNIH the Principal and more than two
million dollars of interest accrued since May 1, 2017.
Id. at 8-9.
filed a motion for summary judgment, Doc. 49, arguing DNIH
breached the Indenture by failing to execute a
supplemental-indenture before selling DNIC to Lonestar, Doc.
50, Pl.'s Br. in Supp., 11. According to Alesco, DNIH
must now return the Principal to Alesco, plus interest.
Id. DNIH counters that its default should be
excused, and, in the alternative, argues Alesco is not
entitled to the interest yet. Doc. 56, Def.'s Resp.,
12-15. Alesco's motion for summary judgment is now ripe
before the Court.
judgment is appropriate “if the movant shows that there
is no genuine dispute as to any material fact and the movant
is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). A dispute “is ‘genuine'
if the evidence is sufficient for a reasonable jury to return
a verdict for the non-moving party.” Burrell v. Dr.
Pepper/Seven Up Bottling Grp., 482 F.3d 408, 411 (5th
Cir. 2007). And a fact “is ‘material' if its
resolution could affect the outcome of the action.”
summary judgment movant bears the burden of proving that no
genuine issue of material fact exists. Latimer v.
Smithkline & French Labs., 919 F.2d 301, 303 (5th
Cir. 1990). Usually this requires the movant to identify
“those portions of the pleadings, depositions, answers
to interrogatories, and admissions on file, together with
affidavits, if any, which it believes demonstrate the absence
of a genuine issue of material fact.” Celotex Corp.
v. Catrett, 477 U.S. 317, 323 (1986) (internal quotation
marks omitted). But if the non-movant ultimately bears the
burden of proof at trial, the movant may satisfy its burden
just by pointing to the absence of evidence supporting the
non-movant's case. Id. at 322-23.
movant meets that burden, then the non-movant must
“show with significant probative evidence that there
exists a genuine issue of material fact.” Hamilton
v. Segue Software Inc., 232 F.3d 473, 477 (5th Cir.
2000) (internal quotation marks omitted). And significant
probative evidence is just that: significant. See Little
v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994)
(per curiam). “[M]etaphysical doubt as to material
facts, ” “conclusory allegations, ”
“unsubstantiated assertions, ” or a mere
“scintilla of evidence” will not do.
Id.(internal citations and internal quotation marks
omitted). Rather, “the non-movant must go beyond the
pleadings and present specific facts indicating a genuine
issue for trial.” Bluebonnet Hotel Ventures, L.L.C.
v. Wells Fargo Bank, N.A., 754 F.3d 272, 276 (5th Cir.
sure, the court views evidence in the light most favorable to
the non-movant when determining whether a genuine issue
exists. Munoz v. Orr, 200 F.3d 291, 302 (5th Cir.
2000). But it need not “sift through the record in
search of evidence to support a party's opposition to
summary judgment.” Ragas v. Tenn. Gas Pipeline
Co., 136 F.3d 455, 458 (5th Cir. 1998) (quoting
Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 915-16
& n.7 (5th Cir. 1992)). Simply put, the non-movant must
“identify specific evidence in the record” and
“articulate the ...