Salcetti v. AIG Property Casualty Co.

          MEMORANDUM AND ORDER

          NANCY F. ATLAS, SENIOR UNITED STATES DISTRICT JUDGE.

         This case is before the Court on the Motion for Summary Judgment (“AIG's Motion”) [Doc. # 11] filed by Defendant AIG Property Casualty Company (“AIG”), to which Plaintiff Robert Salcetti filed a Response and Cross-Motion for Summary Judgment (“Salcetti's Motion”) [Doc. # 14]. AIG filed a Reply in support of its own Motion and a Response to Salcetti's Motion [Doc. # 17], and Salcetti filed a Reply [Doc. # 18]. For the reasons explained below, the Court denies both motions as premature.

         I. BACKGROUND

         Salcetti owns a home in Houston, Texas, that is insured by an AIG homeowner's policy (the “Policy”). In late August 2017, Hurricane Harvey stalled over Houston, causing significant rainfall throughout the area. Salcetti alleges that the U.S. Army Corps of Engineers decided to release water from the Addicks and Barker Reservoirs, and that this water entered his home causing significant damage. See Original Petition [Doc. # 1-4], ¶ 10.

         Salcetti filed a claim with AIG for the damage to his home. He alleges that the cost to repair items in his home that were damaged was $2, 524, 250.00, and that he has received $1, 000, 000.00 from other insurance. See id., ¶ 14. After AIG denied the claim, Salcetti filed this lawsuit seeking to recover the remainder from AIG. Salcetti also seeks extra-contractual damages.

         At the initial conference before this Court on July 29, 2019, the parties advised that they would like to file pre-discovery motions for summary judgment and represented that the motions would be based on an agreed Stipulation of Facts. On that basis, the Court allowed the early motions and imposed a briefing schedule. See Hearing Minutes and Order [Doc. # 8]. Although the parties were not able to reach agreement on a Stipulation of Facts, they each filed a motion for summary judgment. The pending motions have been fully briefed and are now ripe for decision.

         II. APPLICABLE LEGAL STANDARDS

         A. Summary Judgment Standard

         Summary judgment is proper only if the pleadings, depositions, answers to interrogatories, and admissions in the record, together with any affidavits filed in support of the motion, demonstrate that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(a); Bacharach v. Suntrust Mortg., Inc., 827 F.3d 432, 434 (5th Cir. 2016). The Court construes all facts and considers all evidence in the light most favorable to the nonmoving party. See Guar. Bank & Trust Co. v. Agrex, Inc., 820 F.3d 790, 794 (5th Cir. 2016) (emphasis added).

         B. Standard for Insurance Policies

         Under Texas law, the meaning of an insurance contract is to be determined under the standards applicable to contracts generally. See One Beacon Ins. Co. v. Crowley Marine Servs., 648 F.3d 258, 271 (5th Cir. 2011); Mid-Continent Cas. Co. v. Swift Energy Co., 206 F.3d 487, 491 (5th Cir. 2000); Barnett v. Aetna Life Ins. Co., 723 S.W.2d 663, 665 (Tex. 1987). A court's primary concern is to give effect to the intention of the parties as expressed by the policy language. Am. Nat. Gen. Ins. Co. v. Ryan, 274 F.3d 319, 323 (5th Cir. 2001) (citing Ideal Lease Serv., Inc. v. Amoco Prod. Co., 662 S.W.2d 951, 953 (Tex. 1983)).

         III. ANALYSIS

         AIG argues that two exclusions in the Policy apply to Salcetti's claim. Specifically, AIG argues that the “Confiscation” exclusion and the “Surface and Ground Water Damage” exclusion apply. Because they are exclusions to Policy coverage, AIG has the burden to prove that they govern in the dispute. John M. O'Quinn, P.C. v. Lexington Ins. Co., 906 F.3d 363, 367 (5th Cir. 2018) (“The insured bears the initial burden of showing that there is coverage, while the insurer bears the burden of proving the applicability of any exclusions in the policy.”).

         A. “Confiscation ...