      Case: 13-41179          Document: 00512948695              Page: 1      Date Filed: 02/25/2015




           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT


                                            No. 13-41179                              United States Court of Appeals
                                                                                               Fifth Circuit

                                                                                             FILED
TREMAGO, L.P.                                                                         February 25, 2015
                                                                                           Lyle W. Cayce
                 Plaintiff,                                                                     Clerk

v.

EULER-HERMES AMERICAN CREDIT INDEMNITY COMPANY,

                 Defendant - Appellee

v.

CONTINENTAL BUSINESS CREDIT, INCORPORATED,

                  Defendant - Appellant

----------------------------------------------------------------------------------------

CONTINENTAL BUSINESS CREDIT, INCORPORATED, a California
Corporation,

                 Plaintiff - Appellant

v.

EULER-HERMES AMERICAN CREDIT INDEMNITY COMPANY, a
Maryland Corporation,

                 Defendant - Appellee

----------------------------------------------------------------------------------------
CONTINENTAL BUSINESS CREDIT, INCORPORATED,

                 Plaintiff
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                                            No. 13-41179
v.

JULIE SCHATZ, et al,

                  Defendants
-----------------------------------------------------------------------------------------

JENROB INVESTMENTS, L.P. et al

                 Plaintiffs
v.

CONTINENTAL BUSINESS CREDIT, INCORPORATED,

                 Defendant - Third Party Plaintiff - Appellant

v.

EULER-HERMES AMERICAN CREDIT INDEMNITY COMPANY,

                  Defendant - Third Party Defendant - Appellee




                      Appeal from the United States District Court
                           for the Southern District of Texas
                                  USDC No. 7:10-CV-3


Before KING, DAVIS and OWEN, Circuit Judges.
PER CURIAM:*
        Appellant Continental Business Credit, Inc. (“Continental”), appeals the
district court’s entry of summary judgment in favor of Appellee Euler-Hermes



        *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. 13-41179
American Credit Indemnity Co. (“Euler-Hermes”). For the reasons described
below, we AFFIRM the district court’s judgment.
      “We review a grant of summary judgment de novo, applying the same
standard as the district court and viewing the evidence in the light most
favorable to the non-moving party.”        Am. Family Life Assurance Co. of
Columbus v. Biles, 714 F.3d 887, 895 (5th Cir. 2013). A district court may
grant summary judgment for the movant if “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 as to a material fact exists ‘if the
evidence is such that a reasonable jury could return a verdict for the
nonmoving party.’” Rogers v. Bromac Title Servs., L.L.C., 755 F.3d 347, 350
(5th Cir. 2014) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986)). Summary judgment may not be defeated “with conclusory allegations,
unsubstantiated assertions, or only a scintilla of evidence.”     Hathaway v.
Bazany, 507 F.3d 312, 319 (5th Cir. 2007) (internal quotation marks omitted).
      First, as to Continental’s Prompt Payment Act claim, we hold that the
district court did not err when it ordered summary judgment for Euler-
Hermes. In order to prevail on a Prompt Payment Act claim, the insured must
show “(1) a claim under an insurance policy (2) for which the insurer is liable
and (3) that the insurer has not followed one or more sections” of the Act.
Wellisch v. United Servs. Auto. Ass’n, 75 S.W.3d 53, 57 n.2 (Tex. App.––San
Antonio 2002, pet. denied) (citing Allstate Ins. Co. v. Bonner, 51 S.W.3d 289,
91 (Tex. 2001)). “[I]nsurance agencies are required to pay . . . [Prompt Payment
Act] damages only after having first been found liable for the claim.” Amine v.
Liberty Lloyds of Tex. Ins. Co., No. 01-06-00396-CV, 2007 WL 2264477, at *5
(Tex. App.––Houston [1st Dist.] 2007, no pet.) (citing Cater v. United Servs.
Auto. Ass’n, 27 S.W.3d 81, 84 (Tex. App.––San Antonio 2000, pet. denied), and


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                                      No. 13-41179
Oram v. State Farm Lloyds, 977 S.W.2d 163, 167 (Tex. App.––Austin 1998, no
pet.)).
          The settlement between Euler-Hermes and Continental did not contain
an admission of liability under the Policy and both parties dispute whether the
Policy covered the four claims at issue. Despite Continental’s argument that
Euler has “indicated that Continental’s claim was owed,” Euler has never
conceded that the disputed claims were covered under the Policy. Continental
cites Cater, 27 S.W.3d 81 (Tex. App.––San Antonio 2000), and argues that
“Texas courts have specifically recognized a policyholder’s right to seek
statutory remedies . . . under the Prompt Payment Act, even after entering a
partial settlement releasing its ‘contract’ claims.”              However, in Cater the
parties entered into a settlement agreement that required the insurer to pay
$40,000 in contract damages. Id. at 82. Here, there has been no such liability
determination. Similarly, this court made clear that an insurer was liable
under the Prompt Payment Act “when it was found liable for breach of
contract.” Higginbotham v. State Farm Mutual Automobile Ins. Co., 103 F.3d
456, 461 (5th Cir. 1997). Since Euler has never been found liable for breach of
contract, nor will it ever face such a liability determination because the breach
of contract claim was settled, these cases are inapposite. 1 Summary judgment
on Continental’s Prompt Payment Act claim was appropriate.
          Second, we hold that Euler-Hermes’s motion for summary judgment and
its accompanying memorandum put Continental on sufficient notice of the




          Although it is true that Euler-Hermes could have exposed itself to Prompt Payment
          1

Act liability without actually breaching its contract with Continental, see Primo v. Great
American Ins. Co., No. 14–13–00492–CV, 2014 WL 7237330, at *14, (Tex. App.––Houston
[14th Dist.] Dec. 18, 2014, no pet. h.), it remains that “[a]n essential element” of a Prompt
Payment Act claim “is that coverage existed for [Continental]’s claim[s]” under the Policy,
id. at *4. Since the settlement between Euler-Hermes and Continental did not include a
liability determination, Continental cannot maintain a Prompt Payment Act claim.
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                                  No. 13-41179
need to provide evidence establishing each of the elements of its extra-
contractual claims. Our review of the record indicates that Euler-Hermes’s
moving papers complied with its “initial responsibility [to] inform[] the district
court of the basis for its motion.” Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986). This court has reversed summary judgment where a moving party’s
memorandum failed to raise a point “in a manner that would be sufficient to
put the [the non-moving party] on notice that failure to present evidence of [the
elements of each of its claims] could be grounds for summary judgment.” John
Deere Co. v. American Nat’l Bank, Stafford, 809 F.2d 1190, 1191 (5th Cir.
1987). However, that is not the case here. Euler-Hermes argued from the
onset that “Continental does not have any sustainable ‘extra-contractual’
claims.” Furthermore, in its memorandum of law supporting its motion for
summary judgment, Euler-Hermes argued, in the section discussing
Continental’s claim for breach of the duty of good faith, that “Continental has
not alleged, let alone proffered any evidence of any act on Euler’s part that
fairly can be characterized as ‘so extreme’ that it would cause ‘injury
independent of the policy claim.’” Under the same heading, it argued that “[i]n
short, no sustainable ‘extra-contractual’ claim is either stated, nor is there
evidence that would support any such claim.” Accordingly, we hold that Euler-
Hermes’s motion and memorandum put Continental on notice of its need to
argue that it had evidence establishing each of the elements of its extra-
contractual claims. Consequently, assuming that the district court considered
Euler-Hermes’s “no evidence” arguments, such consideration was not
improper.
      Third, we hold that the district court did not abuse its discretion when it
denied Continental’s motion for reconsideration. A motion to reconsider “is not
the proper vehicle for rehashing evidence, legal theories, or arguments that
could have been offered or raised before the entry of judgment.” Templet v.
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                                 No. 13-41179
HydroChem Inc., 367 F.3d 473, 479 (5th Cir. 2004). “[A]n unexcused failure to
present evidence available at the time of summary judgment provides a valid
basis for denying a subsequent motion for reconsideration.” Id. As explained
above, Euler-Hermes put Continental on sufficient notice of its “no evidence”
arguments in its initial briefing. Continental was therefore “on notice that
failure to present evidence of [the elements of each of its claims] could be
grounds for summary judgment.”         John Deere Co., 809 F.2d at 1191.
Accordingly, the district court did not abuse its discretion when it denied
Continental’s motion to reconsider.
      We also hold that summary judgment was appropriate on Continental’s
remaining extra-contractual claims. We first address Continental’s bad faith
claim. “Under Texas law, there is a duty on the part of the insurer to deal
fairly and in good faith with an insured in the processing of claims.”
Higginbotham, 103 F.3d at 459 (citing Arnold v. Nat’l Cnty. Mut. Fire Ins. Co.,
725 S.W.2d 165, 167 (Tex. 1987)). “As long as the insurer has a reasonable
basis to deny or delay payment of a claim, even if that basis is eventually
determined by the fact finder to be erroneous, the insurer is not liable for the
tort of bad faith.” Id. (citing Lyons v. Millers Cas. Ins. Co., 866 S.W.2d 597,
600 (Tex. 1993)). Continental has not cited evidence in the record “to permit
the logical inference that the insurer had no reasonable basis to . . . deny
payment of the claim.” Lyons, 866 S.W.2d at 600. Accordingly, the district
court’s order granting summary judgment for Euler-Hermes on Continental’s
bad faith claim was proper.
      We also hold that the district court properly entered summary judgment
for Euler-Hermes on Continental’s negligence claim. There does not appear to
be any authority––nor has Continental pointed to any––for the proposition
that insurance companies have a duty to draft an insurance policy that
contemplates all of the risks that the insured or a third-party beneficiary
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                                 No. 13-41179
believes the policy should cover. Cf. Westchester Fire Ins. Co. v. English, 543
S.W.2d 407, 414 (Tex. Civ. App.––Waco 1976, no writ) (finding duty breached
where insurer failed to include provision in policy specifically requested by
insured).
      Next, we hold that Continental has failed to establish that a genuine
issue of material fact exists as to its reformation claim. “[U]nder Texas law,
reformation requires an original agreement followed by a mutual mistake
made in reducing the original agreement to writing.” Harbor Ins. Co. v. Urban
Const. Co., 990 F.2d 195, 199 (5th Cir. 1993) (citing Cherokee Water Co. v.
Forderhause, 741 S.W.2d 377, 379 (Tex. 1987)). Continental offers no evidence
to show that the parties agreed for the Policy to cover claims stemming from
the shipment of goods by third parties, and subsequently made a mistake when
reducing that agreement to the written Policy.            Accordingly, summary
judgment on Continental’s reformation claim was appropriate.
      Finally, we hold that Continental has waived its Texas Deceptive Trade
Practices Act (the “DTPA”) claim for failing to address whether it is a consumer
under the DTPA. See United States v. Scroggins, 599 F.3d 433, 446 (5th Cir.
2010) (“A party that asserts an argument on appeal, but fails to adequately
brief it, is deemed to have waived it.” (internal quotation marks omitted)).
Similarly, we hold that Continental has waived its Texas common law fraud
claim by failing to address the elements of such a claim. See id. (“[A]mong
other requirements to properly raise an argument, a party must ordinarily
identify the relevant legal standards and any relevant Fifth Circuit cases.”
(internal quotation marks omitted)).
      Accordingly, for the foregoing reasons, we AFFIRM the district court’s
judgment.




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