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Cohen v. Allstate Insuance Company

United States District Court, S.D. Texas, Houston Division

March 2, 2018

AL COHEN, Plaintiff,


          Lee H. Rosenthal Chief United States District Judge.

         This is a flood insurance case involving an Allstate Insurance Company “Write Your Own” Standard Flood Insurance Policy issued to Al Cohen. After Cohen's home was damaged by a flood in April 2016, he sued Allstate and Rachael Ray, the Allstate insurance agent who sold him the Policy. Cohen alleges that Allstate underpaid and wrongfully denied his claim for damages to his personal property. He also alleges that he purchased the Policy based on Ray's assurances that the Policy covered his detached garage apartment. It did not. Cohen asserts causes of action for: (1) breach of contract; (2) misrepresenting an insurance policy by making an untrue statement of material fact under § 541.061of the Texas Insurance Code; (3) fraud, fraudulent misrepresentation, and negligent misrepresentation; and (4) violations of the Texas Deceptive Trade Practices Act, Tex. Bus. & Comm. Code § 17.41.

         Allstate and Ray moved for summary judgment, Cohen responded, Allstate replied, and Cohen surreplied. (Docket Entries No. 17, 18, 20, 21, 22). The court held a hearing at which counsel for the parties presented oral argument on the motions.

         Based on the filings, arguments, and the applicable law, Allstate's and Ray's motions for summary judgment, (Docket Entries No. 17, 18), are granted. Cohen's breach-of-contract claim is barred by the Policy's one-year statute of limitations. Although Cohen's state-law claims are not preempted by federal law because they are policy-procurement claims, they nonetheless fail as a matter of law. Spong v. Fidelity Nat'l Prop. & Cas. Ins. Co., 787 F.3d 296, 306 (5th Cir. 2015). Cohen's claims are dismissed, with prejudice, and final judgment is separately entered. The reasons for these rulings are explained below.

         I. Background

         The summary judgment record consists of the exhibits attached to Allstate's summary judgment motion, Cohen's response, and Allstate's reply:

• Affidavits of Jason Raske, Allstate's corporate representative, (Docket Entry No. 17, Ex. A), John Kubala, Cohen's public insurance adjuster, (Docket Entry No. 20, Ex. 3), and Cohen, (Id. Ex. 4);
• The Policy declaration setting out the coverage limits, (Docket Entry No. 17, Ex. B);
• FEMA's Standard Flood Insurance Policy, and the Arrangement between FEMA and the Write Your Own carriers, (Id. Exs. C-D);
• A screenshot of Cohen's first notice of loss, a letter confirming that the claim was assigned to an adjuster, a signed public-insurance-adjuster contract between Cohen and Kubala, and a letter from Allstate confirming receipt of the contract, (Id. Exs. E-H);
• A letter dated June 2, 2016 from Allstate to Cohen and Kubala stating that Allstate had sent proof-of-loss documents, (Id. Ex. I);
• A copy of Cohen's own, different, proof-of-loss form, dated June 3, 2016, (Id. Ex. J);
• A letter from Allstate to Cohen, dated June 9, 2016, denying Cohen's proof of loss, (Id. Ex. K; Docket Entry No. 20, Ex. 1);
• A letter from Allstate to Cohen, dated July 19, 2016, closing parts of Cohen's claim, (Id. Ex. L; Docket Entry No. 20, Ex. 2);
• Cohen's signed and executed proof-of-loss form, dated July 19, 2016 and a confirmation of payment dated July 21, 2016, (Id. Exs. M-O);
• A letter from Allstate to Cohen, dated August 29, 2016, denying Cohen's personal-property claim, (Id. Ex. P);
• A signed nonwaiver agreement between Cohen and Allstate dated October 17, 2016, (Id. Ex. Q);
• A partial proof-of-loss form, (Id. Ex. R);
• A letter from Allstate to Kubala, dated November 22, 2016, placing Cohen's claim on inactive status because Allstate had not received the executed partial proof-of-loss form, (Id. Ex. S);
• The signed partial proof of loss, dated November 22, 2016, (Id. Ex. T);
• A confirmation of payment to Cohen, dated December 2, 2016, (Id. Ex. U);
• A letter from Allstate to Cohen, dated December 3, 2016, confirming payment of Cohen's building-damage and personal-property claims, (Id. Ex. V);
• A screenshot of a summary of Cohen's claim history, (Docket Entry No. 21, Ex. X);
• FEMA Bulletin W-16039, (Docket Entry No. 20, Ex. 5); and • FEMA Bulletin W-17013a, (Id. Ex. 7).

         The summary judgment record discloses the following facts, most undisputed. In 2015, Cohen spoke with Ray several times about obtaining flood insurance for his home. Cohen explained that he had a detached garage apartment that he wanted to cover along with the house. Cohen alleges and states in his affidavit that on at least two occasions, Ray assured Cohen that he did not need separate flood insurance policies for his home and for his garage apartment. Cohen relied on Ray's assurances and purchased a single policy for his home and for his garage apartment. The coverage limits were $150, 000 for building damage and $60, 000 for damage to contents.

         On April 18, 2016, a flood damaged Cohen's home and garage apartment and the contents of each. After the flood, Cohen learned that the Policy did not cover the damage to the garage apartment or its contents. Cohen timely notified Allstate of the loss and filed an insurance claim.

         Cohen has two claims, one for building damage and the other for personal-property damage. After reviewing an independent adjuster's report, Allstate concluded that the building damage policy amount was $55, 506.28. On May 27, 2016, Allstate sent Cohen and Kubala a proof-of-loss form for that amount, instructing Cohen to return the form so Allstate could process the flood-loss payment.

         On June 3, 2016, Cohen submitted his own, different, proof of loss, claiming $93, 871.67 in damages, but without documents supporting the amount. On June 9, Allstate sent Cohen and Kubala a letter denying Cohen's unsupported proof of loss ...

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