United States District Court, S.D. Texas, Corpus Christi Division
ORDER DISMISSING CLAIMS
GONZALES RAMOS UNITED STATES DISTRICT JUDGE
have had five opportunities to comply with the substantive
requirements for notice letters, as set out in Texas
Insurance Code §§ 542A.003 and 541.154. First, they
could have complied when they gave pre-suit notice on August
21, 2018. Instead, they sent a non-compliant letter,
expressly protesting the legislative requirements.
See D.E. 5-1.
they could have complied after Defendant filed its verified
plea in abatement (D.E. 5), as required by section
542A.005(c). Instead, they did nothing. And their failure to
file an affidavit in response made abatement pending the
service of a new notice letter automatic under Texas law-even
without Court intervention. Tex. Ins. Code §
542A.005(c). Because, under that law, the period of abatement
continues for a 60-day period after a compliant letter is
served, failure to serve a new letter guaranteed that this
action would not move forward. Tex. Ins. Code §
they could have complied after this Court found the pre-suit
letter (D.E. 5-1) insufficient. On February 8, 2019, the
Court granted Defendant's motion to abate with an Order
(D.E. 7) that required a new notice letter and
Plaintiffs' filing of a statement of compliance within
five days of serving the new notice letter. Neither was done
with due diligence. The required statement of compliance was
not filed at all. And a new notice letter (D.E. 9-1) was
dated June 19, 2019-more than four months after the order
requiring it and only after Defendant filed its motion to
they could have complied after the Court found the second
letter (D.E. 9-1) insufficient and granted Defendant's
motion to dismiss, which Defendant had modified to request
only another abatement (D.E. 11). In that Order, the Court
set an August 8, 2019 deadline for serving a revised notice
letter in compliance with the statute. Plaintiffs were
further ordered to file a statement of compliance with the
Court by August 9, 2019. Instead, Plaintiffs served Defendant
with a non-compliant letter and filed their statement of
compliance (D.E. 13), twenty-one (21) days after the deadline
set by the Court-and, again, only after Defendant filed its
second motion to dismiss.
statement of compliance misrepresents Plaintiffs' effort
to conform to the statutory requirements and to abide by the
orders of this Court. In their response, Plaintiffs assert
that, while they failed to timely file the statement of
compliance, Defendant was not prejudiced by that failure.
D.E. 15, p. 2. However, the statement of compliance
requirement was for the Court's use in managing its
docket, as explained in the Court's first order imposing
the requirement. See, D.E. 7, p. 2.
they could have complied after Defendant filed its second
motion to dismiss (D.E. 12), which is now pending before the
Court. That motion gave Plaintiffs notice of deficiencies
remaining in the current notice letter (D.E. 12-1), even
after Plaintiffs had an opportunity to consider the
Court's detailed listing of the noncompliant elements of
the prior notice letter (D.E. 9-1). See D.E. 11.
clear that Plaintiffs still have not complied as they have
represented. They cured only the representation of the
attorney's fees. And they dropped two of their issues
regarding Defendant's communication with Plaintiffs
regarding their claim. However, the other claims remain, each
with a single additional sentence purporting to provide the
specific information required by § 542A.003.
sentences are conclusory reiterations of the formulaic claim.
For instance, failing to adopt reasonable standards for
prompt investigation is represented to,
"specifically," mean that Defendant failed to
perform a reasonable investigation and include unspecified
damages in its analysis. D.E. 12-1, p. 3. Not attempting in
good faith to effectuate a prompt, fair, and equitable
settlement is, "specifically," stated to be a
refusal to pay the amount Plaintiffs claim as evidenced by
"the attached estimate of hurricane damages,"
without there being an attached estimate with the letter,
much less an estimate that discloses what particular items
are in dispute. Id.
sentence that begins with the term "specifically"
merely restates the general, conclusory claim.
Plaintiffs' letter is not formulated to give Defendant
notice of the wrongful conduct of which it stands accused.
And Plaintiffs continue to expressly protest the statutory
requirements they fail to meet.
the amount demanded has gone from $283, 942.53 (D.E. 5-1),
down to $175, 000 (D.E. 9-1), and back up to $194, 972.97
(D.E. 12-1), the fact remains that these numbers involve
unclear variables. For instance, the value of a mural is
sometimes referenced and currently is not, making it unclear
whether the entire claim has been included. Plaintiffs'
response to the motion to dismiss indicates that it is not
including any claim for the mural at this time, but reserves
the right to claim it later. D.E. 15, pp. 5-6. The reason
given for wanting to hold it aside is that, in the two years
since the storm damaged the mural, they have been unable to
find a qualified appraiser to quantify its loss. The parties
dispute whether a known element of a claim may be held back
for a later claim while the remainder is subject to
the "Plaintiff's estimate" is not accompanied
by an itemized estimate of damages for Defendant to use in
comparing investigations. It is not clear whether this is a
reference to a value at which Plaintiffs, themselves, have
arrived or whether they are referring to the professional
estimate previously submitted to Defendant. To follow
Plaintiffs calculation, one would also need to know how much
of the claim is assigned to the policy's deductible. This
number is not quantified and cannot be derived by this Court
from the record, as neither the policy nor the declarations
page is attached.
the liquidation of the claim continues to defy analysis. And
Plaintiffs continue to defy the statutory requirements under
which they must prosecute their claims. This action has been
pending since December 19, 2018. D.E. 1. Eight months have
been wasted, waiting on Plaintiffs to comply with statutory
requirements-requirements that are not particularly rigorous.
And even if Plaintiffs were to comply at this time, the
statutory 60-day abatement period would delay the case an
additional two months.
Court previously warned that it would not look favorably on
additional delay in the prosecution of the case, which can
only begin after a proper notice letter is provided to
Defendant. Plaintiffs' failure to comply with this
Court's orders to both supply the statutory notice letter
and to do so in a timely manner is contumacious, at best.
This is apparent in Plaintiffs' resistance to satisfying
its statutory requirements with facts to support their legal
theories and, instead, using the notice letter to ...