     Case: 15-10137      Document: 00513304342         Page: 1    Date Filed: 12/11/2015




           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT


                                    No. 15-10137                         United States Court of Appeals
                                  Summary Calendar                                Fifth Circuit

                                                                                FILED
                                                                        December 11, 2015
VINCENT STAGLIANO; PEGGY STAGLIANO,                                        Lyle W. Cayce
                                                                                Clerk
              Plaintiffs - Appellants

v.

THE CINCINNATI INSURANCE COMPANY; THE CINCINNATI
CASUALTY COMPANY,

              Defendants - Appellees




                   Appeal from the United States District Court
                        for the Northern District of Texas
                             USDC No. 3:13-CV-2474


Before SMITH, BENAVIDES, and HAYNES, Circuit Judges.
PER CURIAM:*
       This is a first-party insurance dispute over coverage for damage to
commercial property allegedly caused by a hail storm. Plaintiffs-Appellants
Vincent and Peggy Stagliano (“Plaintiffs”) appeal from the district court’s
grant of summary judgment in favor of Defendants-Appellees The Cincinnati




       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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                                  No. 15-10137
Insurance Company and The Cincinnati Casualty Company (collectively,
“Cincinnati”). We AFFIRM.
                             I. BACKGROUND
      The facts of this case are straightforward. Plaintiffs own a number of
commercial properties in and around Dallas, and they obtained an insurance
policy from Cincinnati protecting forty-eight of the properties from accidental
loss or damage commencing during the policy period. The policy period ran
from August 14, 2010, to August 14, 2011. On June 21, 2011, Plaintiffs
submitted a claim to Cincinnati for damage to one of the properties that
occurred as a result of a May 24, 2011 hail storm. Cincinnati paid the claim.
Approximately one year and eight months later, Plaintiffs submitted claims
for several other properties that they alleged were damaged in the same storm.
Cincinnati denied these claims.
      Plaintiffs then filed suit in Texas state court for breach of contract and
on various other common-law and statutory grounds. Cincinnati removed the
case to federal court, and the parties ultimately winnowed the properties to
three and the claims to five: breach of contract, breach of the common-law duty
of good faith, and violations of the Texas Deceptive Trade Practices Act
(“DTPA”) and Sections 541 and 542 of the Texas Insurance Code. Cincinnati
moved for summary judgment on all claims, relying on the affidavit of Michael
J. Sullivan, a Cincinnati property claims manager. Sullivan’s affidavit stated
that he inspected the roofs of the properties at issue and determined that they
had taken hail damage from “multiple storms,” some of which may have
occurred after the expiration of Plaintiffs’ insurance policy. Cincinnati thus
argued that Plaintiffs could not establish that the damage to their properties
was caused by a hail storm that took place within the policy period, and they




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                                       No. 15-10137
had no evidence to support their remaining claims. 1 In opposition to the motion
for summary judgment, Plaintiffs submitted the expert affidavit of Thomas M.
Shingler, a structural engineer who stated that he inspected one property at
2270 Valley View Lane (“The Valley View Property”) and noted various
indications of hail damage. Shingler concluded that “based on my background,
experience and evaluation of the meteorological events relating to this matter,
hail did in fact occur on May 24, 2011,” and “such hail was consistent with such
damages I personally observed.”
       The district court granted Cincinnati’s motion for summary judgment,
ruling that Shingler’s expert affidavit was conclusory and unreliable and thus
failed to create a genuine issue of material fact as to whether damage to any of
the properties occurred during the policy period. The district court also noted
that Plaintiffs had failed to produce any evidence, even in the form of
conclusory affidavits, on their DTPA and Insurance Code claims. Plaintiffs now
appeal, arguing that their proffered evidence created genuine issues of
material fact on all claims with respect to the Valley View Property.
                                   II. DISCUSSION
       “We review a grant of summary judgment de novo, applying the same
standard as the district court” and “view[ing] the evidence ‘in the light most
favorable to the nonmoving party.’” Fennell v. Marion Indep. Sch. Dist., 804
F.3d 398, 407 (5th Cir. 2015) (citations omitted). Summary judgment is proper
“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 genuine dispute of material fact exists when the ‘evidence is such that



       1 Cincinnati also argued that Plaintiffs’ delay in filing their insurance claims caused
it prejudice and relieved it of any duty to perform under the policy. The district court did not
address this argument in its order, however, and because we affirm on the grounds relied on
by the district court, we likewise need not address the issues of delay and prejudice.
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a reasonable jury could return a verdict for the nonmoving party.’” Martin Res.
Mgmt. Corp. v. AXIS Ins. Co., 803 F.3d 766, 768 (5th Cir. 2015) (citation
omitted).
      “[A] party seeking summary judgment always bears the initial
responsibility of informing the district court of the basis for its motion, and
identifying those portions of [the record] which it believes demonstrate the
absence of a genuine issue of material fact.” Davis v. Fort Bend Cty., 765 F.3d
480, 484 (5th Cir. 2014) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986)), cert. denied, 135 S.Ct. 2804 (2015). When the nonmoving party will
bear the burden of proof at trial, the moving party may satisfy this
responsibility by “point[ing] out the absence of evidence supporting the
nonmoving party’s case.” Latimer v. Smithkline & French Lab., 919 F.2d 301,
303 (5th Cir. 1990). “The burden then shifts to the nonmoving party to go
beyond the pleadings and by her own affidavits, or by the depositions, answers
to interrogatories, and admissions on file, designate specific facts showing that
there is a genuine issue for trial.” Davis, 765 F.3d at 484 (quoting Celotex, 477
U.S. at 323). Put another way, summary judgment is appropriate “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 that party will bear the
burden of proof at trial.” Celotex, 477 U.S. at 323. And in this regard, “a party
cannot      defeat   summary     judgment     with    conclusory    allegations,
unsubstantiated assertions, or ‘only a scintilla of evidence.’” Turner v. Baylor
Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007) (quoting Little v.
Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc) (per curiam)).
      In the present case, Plaintiffs allege that Cincinnati breached their
insurance contract by failing to pay for damage to the Valley View Property
that occurred as a result of a hail storm within the policy period. And Texas
law is clear that “[p]roof that the claimed losses occurred during the policy
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period is an essential element of [an insured’s] coverage claim on which it bears
the burden of proof.” New Hampshire Ins. Co. v. Martech USA, Inc., 993 F.2d
1195, 1200 (5th Cir. 1993). Thus, Plaintiffs had to come forward with some
evidence or indication that the damage to the Valley View Property was caused
by the May 21, 2011 hail storm, and not another storm occurring outside the
policy period, in order to defeat Cincinnati’s motion for summary judgment.
Plaintiffs attempted to meet this burden by offering the expert affidavit of
Shingler; however, we agree with the district court that this affidavit was not
sufficient to preclude summary judgment.
      We have previously held that “[u]nconfirmed rumors of loss are
insufficient” to create a fact issue as to whether the losses occurred during an
insurance policy coverage period. Martech, 993 F.2d at 1200. In the same way,
we think that a single conclusory expert affidavit, devoid of any factual support
or explanation of the expert’s basis for concluding that observed damage
occurred as a result of a particular hail storm within the policy period, was
insufficient to meet Plaintiffs’ burden of “designat[ing] specific facts showing
that there is a genuine issue for trial” on this essential element of their
insurance contract claim. “[T]here is a level of conclusoriness below which an
affidavit must not sink if it is to provide the basis for a genuine issue of
material fact,” Orthopedic & Sports Injury Clinic v. Wang Lab., Inc., 922 F.2d
220, 224 (5th Cir. 1991), and “unsupported [expert] affidavits setting forth
ultimate or conclusory facts and conclusions of law are insufficient to either
support or defeat a motion for summary judgment.” Id. at 225 (quoting Galindo
v. Precision Am. Corp., 754 F.2d 1212, 1216 (5th Cir. 1985)). In other words,
“[w]ithout more than credentials and a subjective opinion, an expert’s
testimony that ‘it is so’” will not suffice. Id. (quoting Viterbo v. Dow Chem. Co.,
826 F.2d 420, 424 (5th Cir. 1987)). We think that Shingler’s affidavit in this
case was little more than an allusion to his credentials, a recitation of the hail
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                                        No. 15-10137
damage observed, and a conclusory, “subjective opinion” that the damage
resulted from a hail storm within the policy period. Accordingly, Shingler’s
affidavit was insufficient to create a genuine dispute of material fact on an
essential element of Plaintiffs’ claim, and because the only other evidence
presented by Plaintiffs (damage estimates and a short email exchange between
claims adjustors) shed no light on the inception of the damage, the district
court properly granted summary judgment on Plaintiffs’ breach of contract
claim. 2
       Nevertheless, Plaintiffs argue that the amended affidavit they submitted
with their motion to alter or amend the district court’s judgment, which
ostensibly “amplif[ied]” Shingler’s conclusions about the date of damage,


       2  We note that it is unclear whether the district court’s decision to grant summary
judgment in this case was based on inadmissibility of the expert’s opinion under the Federal
Rules of Evidence or simply the failure of the affidavit to set forth “specific facts” necessary
to create a fact issue under Federal Rule of Civil Procedure 56 and related precedent. The
district court held that the affidavit was not “sufficient evidence to establish a genuine issue
of material fact” because it lacked “the necessary factual support linking the hail damage . .
. to the storm occurring in May 2011,” but the court also “sustain[ed] Defendants’ objection”
that the affidavit was “neither reliable nor helpful to the jury.” Stagliano v. Cincinnati
Insurance Co., No. 3:13-CV-2474 (N.D. Tex. Dec. 9, 2014). A judge on this court has previously
perceived a tension between the admissibility requirements for expert testimony and the
burdens at summary judgment when expert affidavits are utilized. See First United Fin.
Corp. v. U.S. Fid. & Guar. Co., 96 F.3d 135, 138–40 (5th Cir. 1996) (Garza, J., concurring)
(noting that “the sufficiency of an expert’s opinion under Rule 56 is an issue distinct from the
admissibility of an expert’s opinion under” the Federal Rules of Evidence). We are unaware
of any subsequent Fifth Circuit case to have addressed this tension, but in any event, both
parties treat the question as one of Plaintiffs’ Rule 56 burden, and as the D.C. Circuit has
recognized, “[t]o hold that [the admissibility requirements for expert testimony] prevent[] a
court from granting summary judgment against a party who relies solely on an expert’s . . .
theoretical speculations would seriously undermine the policies of Rule 56.” Merit Motors,
Inc. v. Chrysler Corp., 569 F.2d 666, 673 (D.C. Cir. 1977). Thus, we conclude that Shingler’s
affidavit in this case was insufficient to meet Plaintiffs’ Rule 56 burden. See First United, 96
F.3d at 141 (Garza, J., concurring) (concluding that “the better interpretation” of Rule 56
“requires expert affidavits to include some indication of the reasoning process underlying the
expert’s opinion”); see also Crayton v. Amadeo Rossi, S.A., 384 F. App’x 330, 332–33 (5th Cir.
2010) (holding that an expert affidavit was insufficient “to create [an] issue[] of material fact
at the summary judgment stage” because it “merely set[] out a variety of conclusory
allegations that [were] actually opinions devoid of an underlying factual basis and
explanation”).
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                                       No. 15-10137
created a genuine dispute of material fact and should have prompted the
district court to allow Plaintiffs’ claims regarding the Valley View Property to
proceed. We cannot agree. Even assuming the affidavit could have been
considered on a Rule 59(e) motion, 3 it contained the same deficiencies that
rendered the initial affidavit insufficient to meet Plaintiffs’ summary judgment
burden. The new affidavit did state that Shingler relied in part on the
observations of a construction expert and building occupants, and Plaintiffs
are correct to point out that such observations, even if inadmissible, may
properly be relied upon under Federal Rule of Evidence 703. See FED. R. EVID.
703. However, Shingler’s statement that he relied on the unspecified
observations of others to reach his conclusion did nothing to address the
affidavit’s dearth of specific factual details connecting the damage to the May
11th hail storm, nor did it make up for the affidavit’s utter failure to delineate
any principles or methodology through which Shingler was able to conclude
that the damage came from that particular storm. As such, the district court
properly denied Plaintiffs’ motion to alter or amend its grant of summary
judgment in favor of Cincinnati.
       With respect to Plaintiffs’ remaining claims, we note that an action for
breach of the Texas common-law duty of good faith requires a showing that the
insurer’s liability is “reasonably clear.” State Farm Fire & Cas. Co. v. Simmons,
963 S.W.2d 42, 44 (Tex. 1998). Thus, summary judgment was proper on this
claim for the same reason it was proper on the breach of contract claim. As to
the statutory claims for unfair or deceptive insurance practices, Plaintiffs
produced no evidence that we can identify to raise a genuine dispute of



       3 See Rosenzweig v. Azurix Corp., 332 F.3d 854, 863–64 (5th Cir. 2003) (noting that
“[a] Rule 59(e) [motion] ‘must clearly establish either a manifest error of law or fact or must
present newly discovered evidence’ and ‘cannot be used to raise arguments which could, and
should, have been made before the judgment issued’”).
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material fact. Rather, on appeal Plaintiffs simply repeat their argument from
the district court that they “have made a colorable claim for extra-contractual
damages . . . couched in long-standing case law” and based on “proper
evidence.” We think this represents the epitome of an “unsubstantiated
assertion[].” Turner, 476 F.3d at 343. Accordingly, we hold that summary
judgment was proper on all of Plaintiffs’ claims.
      AFFIRMED.




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