                                                        United States Court of Appeals
                                                                 Fifth Circuit
                                                              F I L E D
              IN THE UNITED STATES COURT OF APPEALS
                      FOR THE FIFTH CIRCUIT                   March 30, 2001

                                                          Charles R. Fulbruge III
                                                                  Clerk
                            No. 00-10216



     In the Matter of: KAYLA SEGERSTROM,
                                           Debtor

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

     ROBERT YAQUINTO, JR. As Trustee for the Estate of Kayla
     Segerstrom

                                           Appellant,
                               versus

     KAYLA SEGERSTROM; EMPLOYERS FIRE INSURANCE COMPANY;
     TOUCHSTONE, BERNAYS, JOHNSTON, BEALL & SMITH LIMITED
     LIABILITY PARTNERSHIP,

                                           Appellees.


                      --------------------
          Appeal from the United States District Court
               for the Northern District of Texas
                      --------------------


Before JOLLY, MAGILL* and BENAVIDES, Circuit Judges.

BENAVIDES, Circuit Judge:

     Robert Yaquinto, Jr., as trustee of Kayla Segerstrom’s

Chapter 7 bankruptcy estate, appeals from a summary judgment in

favor of defendants Touchstone, Bernays, Johnston, Beall & Smith

L.L.P. and Employers Fire Insurance Company on the estate’s legal

malpractice, breach of fiduciary duty and breach of contract


     *
       Circuit Judge of the Eighth Circuit, sitting by
designation.
claims.   Yaquinto also appeals the district court’s denial of the

estate’s motion to compel discovery of certain communications

between Kayla Segerstrom and her attorneys.              We AFFIRM.

                      FACTUAL   AND   PROCEDURAL BACKGROUND

     In 1995, Kayla Segerstrom, then 17 years old, drove a van

across the center line and struck head on a 1986 Honda Civic

carrying the Colvin family.1          Just over a year after the

accident, the Colvins sued Segerstrom, her parents, and her

parents’ sole proprietorship D&R Enterprises (D&R) in Texas state

court for negligence, negligent entrustment, and failure to

train/vicarious liability respectively (the Colvin litigation).

     The van Segerstrom drove was covered by a $75,000 motor

vehicle insurance policy issued by Employers Fire Insurance

Company (Employers) to D&R.           D&R also had a $1 million

comprehensive general liability policy issued by Commercial Union

Insurance, Employers’ parent company.             Employers hired

Touchstone, Bernays, Johnston, Beall & Smith, L.L.P. (Touchstone)

to defend Segerstrom, her parents, and D&R.

     Segerstrom has acknowledged responsibility for the accident,

which occurred after she turned her attention from the road to a

ringing cell phone.     At trial, she testified that at the time of


     1
       The collision had tragic consequences. Three-year              old
Cole Colvin died instantly. James Bradley Colvin, Cole’s              father,
suffered severe and permanent brain damage. Two-year old              Breana
Colvin suffered a broken neck. Her mother, Terri Colvin,              endured
serious facial and body lacerations.

                                         2
the accident she was driving the van without her parents’

permission, and that she was not using the van in connection with

any D&R business.2   The Colvins argued that D&R shared liability

for the accident because the company failed to train Segerstrom

not to answer a ringing cell phone while driving the company van.

The jury returned a verdict in excess of $6.5 million in favor of

the Colvins, but found only Kayla Segerstrom liable.   The state

court eventually entered judgment against Segerstrom in excess of

$8.5 million.   Employers immediately tendered its $75,000 policy

limits.

     On February 6, 1998, the Colvins filed an involuntary

bankruptcy petition against Segerstrom.    See 11 U.S.C.A. § 303

(West 1993).    Segerstrom consented to the entry of an order for

relief.3   The bankruptcy court granted a motion by Robert

Yaquinto to hire Bellinger & DeWolf (Bellinger), the firm that

had represented the Colvins, as special counsel to pursue claims

against Touchstone and Employers on a contingency basis.

     With Bellinger’s assistance, the estate filed a complaint

     2
       Segerstrom’s parents were out of town at the time of the
accident; they had left her under the care of her grandmother.
Segerstrom testified that both of her parents independently told
her not to drive the van. At the time of the accident,
Segerstrom said that she was driving to a friend’s house.
     3
       The only creditors that filed claims against Segerstrom’s
estate were the Colvins, an attorney and law firm that had
represented the Colvins in the Colvin litigation, and a car
leasing company. The stay was lifted to allow the leasing
company to recover its car, leaving only the Colvins and their
lawyers as claimants.

                                  3
against Touchstone and Employers on behalf of Segerstrom’s estate

alleging negligence, gross negligence and breach of fiduciary

duty in connection with the Colvin litigation (the malpractice

suit).   The complaint alleged that Touchstone had an inherent

conflict of interest in representing Segerstrom, her parents, and

D&R as defendants in the same litigation.    According to the

estate, this conflict caused Segerstrom to absorb 100% of the

liability for the accident when that liability should have been

shared with D&R.   As to Employers, the estate alleged that the

insurer violated the general duty of reasonableness Texas imposes

on insurers by hiring only Touchstone to represent Segerstrom,

her parents, and D&R.    This breach rendered Employers directly

liable for Touchstone’s conflict of interest and the harm it

caused Segerstrom.   The complaint sought to recover for

Segerstrom’s estate $8.5 million - the value of the judgment

assessed against Segerstrom in the Colvin litigation.

     After the initiation of the malpractice suit, Segerstrom

signed an affidavit stating that Touchstone “did an excellent

job” during the state court litigation and that she had no basis

for dissatisfaction with the firm’s work.    She also reported that

Touchstone advised her of all litigation risks associated with

the state court trial.    As to the alleged conflict between

Segerstrom and her parents, Segerstrom testified “[t]here was no

conflict between my position and interest and those of my

parents.   My parents and I knew that they were not at fault and I

                                  4
was not willing to lie or instruct my attorney to mislead others

or try to shift blame to my parents.”

      In October 1998, Segerstrom’s personal liability to the

Colvins was discharged.

      In the winter of 1999, Yaquinto filed motions to compel

discovery of communications between Segerstrom and Touchstone

that had been claimed by both parties as protected by attorney-

client privilege.   Yaquinto argued that he, as trustee,

controlled Segerstrom’s attorney-client privilege to the extent

that it could be waived by filing a legal malpractice action.

The district court referred the motions to compel to the

bankruptcy court, which recommended they be granted.   The

district court rejected the bankruptcy court’s recommendation,

however, concluding that allowing the attorney-client privilege

to transfer would inhibit its primary purpose: the facilitation

of full and honest communications between attorneys and their

clients.   Yaquinto v. Touchstone, Bernays, Johnston, Beall &

Smith, L.L.P., 1999 WL 354228, *2 (N.D.Tex. 1999).

      Following denial of the trustee’s motions to compel,

Touchstone and the estate filed cross motions for summary

judgment on the pending legal malpractice claims, and Employers

filed a motion for summary judgment on all claims pending against

it.   Adopting the Report and Recommendation of a magistrate

judge, the district court granted summary judgment against the


                                 5
estate on all claims.    Yaquinto now appeals those judgments, as

well as the district court’s denial of the motions to compel.



                               DISCUSSION

     This case presents claims raised in an adversary proceeding

over which the district court exercised jurisdiction pursuant to

28 U.S.C. § 1334.     Yaquinto timely provided notice of appeal, and

this Court exercises jurisdiction pursuant to 28 U.S.C. § 1291.



I.   The Summary Judgment Rulings

     We review grants of summary judgment de novo, guided by the

same standard as the district court: Federal Rule of Civil

Procedure 56.   Stults v. Conoco, Inc., 76 F.3d 651, 654 (5th Cir.

1996).   Pursuant to Rule 56, a party may obtain summary judgment

when "the pleadings, depositions, answers to interrogatories, and

admissions on file, together with the affidavits, if any, show

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."

FED.R.CIV.P. 56(c).    In determining whether a genuine issue of

material fact exists, we view the evidence and inferences in the

light most favorable to the nonmoving party.     Taylor v. Gregg, 36

F.3d 453, 455 (5th Cir. 1994).     Dispute about a material fact is

"genuine" if the evidence could lead a reasonable jury to find

for the nonmoving party.     Anderson v. Liberty Lobby, Inc., 477


                                   6
U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986).

     A.   The Estate’s Legal Malpractice Claim Against Touchstone

     Touchstone urged the district court to grant summary

judgment on the following grounds: (1) Segerstrom’s bankruptcy

estate did not include a legal malpractice claim against

Touchstone because any such claim had been denied by Segerstrom,

(2) any negligence by Touchstone did not cause Segerstrom injury

because her personal liability on the state court judgment had

been discharged, and (3) the estate could not prove that any

negligence by Touchstone caused harm to Segerstrom in the Colvin

litigation by demonstrating an alternative meritorious defense

that would have led to a more favorable result for her.    The

magistrate and district courts addressed only the first two

grounds, finding in favor of Touchstone on both.    The estate’s

briefing and oral argument in this appeal focus on reversing the

district court on these two issues.    Although the estate’s

arguments raise significant questions as to the propriety of the

district court’s analysis, it is well-settled that we may affirm

a district court’s grant of summary judgment on any ground

articulated before that court.     See Chriceol v. Phillips, 169

F.3d 313, 315 (5th Cir. 1999).     Because we conclude that the

estate has not offered sufficient proof that Segerstrom suffered

injury as consequence of Touchstone’s representation during the

Colvin litigation, we affirm the district court’s summary

judgment in favor of Touchstone.

                                   7
     At the outset, we briefly review the district court’s

holding with respect to whether Segerstrom’s estate includes a

legal malpractice claim against Touchstone.    Relying on Texas

law, the district court determined that Segerstrom, and hence her

estate, had no interest in an “unasserted, denied” legal

malpractice claim against Touchstone.     See Dauter-Clouse v.

Robinson, 936 S.W.2d 329, 332 (Tex. App. 1996, no writ)(holding

that Texas law does not grant debtors a property interest in “an

unasserted, denied legal malpractice claim.”).    As a consequence,

the court concluded that no cause of action became part of the

bankruptcy estate.

     It has long been established that federal bankruptcy law

determines the scope of a debtor’s bankruptcy estate.     See United

States v. Whiting Pools, Inc., 462 U.S. 198, 204-5 (1983).

Pursuant to section 541(a) of the Bankruptcy Act of 1986 (the

Code), a debtor’s bankruptcy estate consists of all “legal or

equitable interests . . . in property as of the commencement of

the case.”   11 U.S.C. § 541(a) (1993).   The reference to all

“legal or equitable interests” includes any “causes of action

belonging to the debtor at the time the case is commenced.”

Louisiana World Exposition v. Federal Ins. Co., 858 F.2d 233, 245

(5th Cir. 1988) (citations omitted).    A debtor’s pre-petition

rights in property, such as a cause of action, are determined

according to state law.   Butner v. United States, 440 U.S. 48,


                                 8
55, 99 S.Ct. 914, 918 (1979) (explaining that “[p]roperty

interests are created and defined by state law” and, “[u]nless

some federal interest requires a different result,” should not be

analyzed differently “simply because an interested party is

involved in a bankruptcy proceeding.”); Louisiana World, 858 F.2d

at 252.   This Circuit has relied on state law to determine (1)

whether the debtor, as opposed to someone else, had a property

interest in a right of action as of the commencement date, and

(2) whether a right of action accrued pre-petition, and hence

belonged to the estate, or post-petition.    See, e.g., Matter of

Wheeler, 137 F.3d 299, 300-01 (5th Cir. 1998); Matter of

Educators Group Health Trust, 25 F.3d 1281, 1283 (5th Cir. 1994).

     The district court’s reliance on state law to define a

debtor’s rights in property based on the debtor’s post-petition

conduct is inconsistent with these organizing principles of

bankruptcy estate law.    Butner does not empower states to alter

their property rights holdings in the bankruptcy context.    To the

contrary, Butner espouses the principle that property rights

within a state should remain the same within and outside of

bankruptcy.     See Louisiana World, 858 F.2d at 252 (“Butner . . .

stresses that federal bankruptcy law should not be used to work a

substantive change in the ordering of property interests under

state law.”).    For that reason, state law determines only whether

a cause of action accrued to the debtor as of the commencement of


                                   9
the bankruptcy case.   Once that determination has been made,

federal law controls whether a trustee can maintain the cause of

action on behalf of the bankruptcy estate.   Federal law provides

that when a legal malpractice cause of action has accrued to a

debtor as of the commencement of the bankruptcy case, it becomes

part of the debtor’s bankruptcy estate.    Educators’ Group Health,

25 F.3d at 1284.

     As of the commencement of Segerstrom’s bankruptcy case, a

legal malpractice claim against Touchstone had accrued to

Segerstrom according to Texas law.   See In re Swift, 129 F.3d

792, 795-96 (5th Cir. 1997) (collecting Texas law on accrual of

legal malpractice actions).   Segerstrom never denied or waived

that malpractice action prior to the commencement of her

bankruptcy.   Since Touchstone has provided no tenable basis in

federal law for withholding Segerstrom’s legal malpractice claim

from her bankruptcy estate, we conclude that the estate can

pursue that claim.

     We now proceed to analyze whether the estate has presented

sufficient evidence to survive Touchstone’s motion for summary

judgment on the legal malpractice claim.   When a trustee

prosecutes a right of action derived from the debtor, the trustee

stands in the shoes of the debtor.   See 5 Lawrence P. King,

Collier on Bankruptcy ¶ 541.08 (15th ed. 1996). The trustee is

subject to all defenses available against the debtor, and must


                                10
prove all elements that the debtor herself would be required to

prove.   Stumph v. Albracht, 982 F.2d 275, 277 (8th Cir. 1992); In

re Giorgio, 862 F.2d 933, 936 (1st Cir. 1988).     See also Wiley v.

Public Investors Life Ins. Co., 498 F.2d 101, 104 (5th Cir.

1974).   To successfully prosecute Segerstrom’s legal malpractice

claim against Touchstone, Texas law requires that Yaquinto prove

four elements: (1) Touchstone owed Segerstrom a duty; (2)

Touchstone breached that duty; (3) the breach proximately caused

injury to Segerstrom; and (4) damages resulted.4    See Streber v.


     4
       In an alternative holding, the district court determined
that Yaquinto would be unable to prove any damages because
Segerstrom’s personal liability to the Colvins had been
discharged. See McClarty v. Gudenau,176 B.R. 788, 790 (E.D. Mich.
1995) (holding that a chapter 7 trustee could not recover an
excess judgment against the debtor’s former attorney through a
legal malpractice action because the debtor’s personal liability
had been discharged). We do not adopt the district court’s
holding. In In re Edgeworth, this Court held that a discharged
debt “continues to exist” and judgment creditors “may collect
from any other source that may be liable.” In re Edgeworth, 993
F.2d 51, 53 (5th Cir. 1993); 11 U.S.C. § 524(e) (2000)
(“[D]ischarge of a debt of the debtor does not affect the
liability of any other entity on, or the property of any other
entity for, such debt.”). We noted in Edgeworth that the
bankruptcy code’s fresh start policy was not intended to allow
insurers to escape obligations simply based on the “financial
misfortunes of the insured.” Id. Though Edgeworth does not
control the present case because it involved a nominal suit
against the debtor for the debtor’s negligence and an insurance
company’s liability for that negligence, its rationale could be
extended to include cases like this one. As we explained in
Edgeworth, it makes little sense to allow those who have
committed torts to escape liability because of the financial
misfortunes of their victims. Moreover, allowing a cause of
action to go forward on the facts of this case would not threaten
financial harm to the debtor, thus the primary purpose behind the
discharge would be protected. Because we are able to affirm the
district court’s judgment based on the issues of injury and

                                11
Hunter, 221 F.3d 701, 722 (5th Cir. 2000)(citations omitted);

Federal Deposit Insurance Corp. v. Shrader & York, 991 F.2d 216,

221 (5th Cir. 1993)(citing Lucas v. Texas Industries, Inc., 696

S.W.2d 372, 376 (Tex. 1984)).

     The duty element is not at issue in this case.   See Zidell

v. Bird, 692 S.W.2d 550, 553 (Tex. App. 1985, no writ)

(recognizing that attorneys owe their clients a duty to perform

in accordance with the standards of the profession); Longaker v.

Evans, 32 S.W.3d 725, 733 (Tex. App. 2000, n.w.h.) (recognizing

that attorneys owe their clients a fiduciary’s duty of loyalty).

Whether Touchstone breached either its duty of care or fiduciary

duty has been contested; based solely on conflicting affidavit

testimony, we assume that the estate has raised a material fact

question as to whether Touchstone breached its duty of care by

jointly representing all defendants in the Colvin litigation

and/or failing to deflect responsibility for the accident from

Kayla Segerstrom onto D&R.   To avoid summary judgment, the estate

must still provide evidence that Segerstrom suffered injury as a

consequence of these alleged breaches.5   In this regard, the


causation under Texas law, however, we need not resolve this
issue.
     5
       The estate’s complaint alleged breach of fiduciary duty in
addition to negligence and gross negligence. The estate
maintains that it need not show injury or causation with respect
to its breach of fiduciary duty claims. While the Texas Supreme
Court has dispensed with the need to prove an actual injury and
causation when a plaintiff seeks to forfeit some portion of an

                                12
estate must prove “a suit within a suit” - it must demonstrate

that but for the manner in which Touchstone conducted her

defense, Segerstrom would have obtained a better result in the

Colvin litigation.   See Mackie v. McKenzie, 900 S.W.2d 445, 449

(Tex. App. 1995, writ denied); Heath v. Herron, 732 S.W.2d 748,

753 (Tex. App. 1987, writ denied).   While Segerstrom’s post-

petition affidavit testimony denying the existence of a legal

malpractice claim is irrelevant to whether the claim becomes part

of her bankruptcy estate in accordance with federal law, her

testimony carries considerable weight in determining whether the

estate has met its burden of establishing injury and causation in

accordance with Texas law.

     Initially, we examine whether the estate has offered

sufficient evidence that Segerstrom, as opposed to her creditors,

suffered injury in the Colvin litigation.   According to the

estate, Segerstrom suffered an injury because the jury awarded a

large verdict against her when that verdict could have been




attorney’s fees in connection with a breach of fiduciary duty,
see Burrow v. Arce, 997 S.W.2d 229, 240 (Tex. 1999), injury and
causation are still required when a plaintiff seeks to recover
damages for a breach of fiduciary duty. See Longaker, 32 S.W.3d
at 733 n. 2 (“The holding [of Burrow] has no application . . .
where the client/estate does not seek fee forfeiture, but rather
seeks actual damages caused by the fiduciary's misconduct.”).
The estate’s complaint does not seek a forfeiture of the fees
Touchstone received for representing Segerstrom, rather the
complaint alleges that “[a]s a direct and proximate result of
Touchstone breaching its fiduciary duties, [Segerstrom] and her
estate have suffered damages in excess of $8.5 million.”

                                13
reduced if different litigation tactics had been employed.

Segerstrom’s affidavit testimony rejects the notion that she has

suffered any injury.   Segerstrom’s independent appellate attorney

points out that the strategic decision to accept responsibility

for the accident during the Colvin litigation protected

Segerstrom’s own financial interests.     At the time of the trial,

Segerstrom lived with her parents and was dependent on them for

financial (as well as moral) support.     Any liability allocated to

D&R would have damaged Segerstrom as well as her parents.

Indeed, liability placed on D&R would have damaged Segerstrom far

more than liability allocated to her, since she had no

unencumbered personal assets.

     The estate presumes that a conflict between Segerstrom’s

subjective views of her representation and the estate’s

conclusory analysis of that representation is sufficient to

create an issue of fact as to injury.     We disagree.   Texas courts

have recognized that legal malpractice actions are “intrinsically

personal,” and that the satisfaction of the client in a legal

malpractice case is “paramount.”      Charles v. Tamez, 878 S.W.2d

201, 207 (Tex. App. 1994, writ denied); see also Zuniga v. Gross,

Locke & Hebdon, 878 S.W.2d 313, 318 (Tex. App. 1994, writ

ref’d.).   “Unless [the client] is proved incompetent, he alone

can determine if he believes that his counsel misrepresented

him.”   Charles, 878 S.W.2d at 207.    The estate has produced no



                                14
evidence suggesting either that Segerstrom did not receive the

precise goal she sought in the Colvin litigation, or that she was

not competent to protect her interests during the Colvin

litigation.    As a consequence, we conclude that the estate has

failed to prove that Segerstrom suffered “injury,” in the legal

malpractice sense, in the Colvin litigation.

     Beyond its failure to establish an injury to Segerstrom, the

estate has failed to provide sufficient evidence that any

malpractice by Touchstone caused Segerstrom to suffer an adverse

judgment.    The estate must prove not only that an alternative

trial strategy was available to Segerstrom, but that Segerstrom

would have pursued that strategy with independent representation.

See Trinity Universal Ins. Co. v. Bleeker, 966 S.W.2d 489, 491

(Tex. 1998) (requiring that plaintiff produce evidence that had

he been informed of settlement offer, he would have accepted it,

to satisfy causation element of a Texas deceptive trade practices

claim).     Segerstrom’s affidavit testimony states clearly that

she did not wish to cast blame for the accident on her parents or

their business.    The estate has produced no evidence to rebut

this testimony or otherwise suggest that Segerstrom would have

pursued the estate’s proposed trial strategy under any

circumstances.    This deficiency alone causes the estate’s claim

to fail on causation grounds.

     Additionally, the estate has produced insufficient evidence

that its proposed strategy would have been meritorious.    At

                                 15
trial, Segerstrom testified that (1) she was driving the van in

contravention of her parents’ express orders, (2) independently

of any D&R business, and that (3) she alone was responsible for

the accident.    In its “suit within a suit,” the estate must

demonstrate either that its alternative trial strategy would have

overcome this testimony, or that Segerstrom perjured herself in

the Colvin litigation.   The estate has offered no evidence

suggesting perjury.   As to the possibility that Touchstone could

have somehow overcome Segerstrom’s trial testimony by actively

attempting to cast blame onto D&R, the jury’s verdict from the

Colvin litigation indicates how meritorious that strategy would

have been.   The only evidence that Touchstone’s alleged breaches

caused Segerstrom to suffer an adverse judgment are conclusory

statements in the affidavits of the estate’s expert witnesses.6

These conclusory statements are wholly unsupported by evidence in

the record and therefore fail to create a genuine issue of

material fact.   See Orthopedic & Sports Injury Clinic v. Wang

Lab., Inc., 922 F.2d 220, 225 (5th Cir. 1991) (noting that

"affidavits setting forth 'ultimate or conclusory facts . . .'

are insufficient to either support or defeat a motion for summary

judgment[,]" and that "[w]ithout more than credentials and a


     6
       Both experts state: “It is . . . my opinion that the
failure to provide a defense and simultaneous representation of
all defendants proximately caused Kayla Segerstrom to have
entered against her a judgment in the amount of $6,895,000 in the
Colvin litigation.”.

                                16
subjective opinion, an expert's testimony that 'it is so' is not

admissible.") (citations omitted).

     In sum, we are persuaded that the estate has not satisfied

its burden of proving that negligence by Touchstone caused injury

to Segerstrom.   The estate has failed to present sufficient

evidence that (1) Segerstrom suffered injury, in the legal

malpractice sense, (2) Segerstrom would have ever elected to

pursue the estate’s alternative trial strategy, or (3) the

alternative trial strategy could have prevented Segerstrom from

suffering an adverse judgment in the Colvin litigation.

Consequently, the district court properly granted summary

judgment for Touchstone.

     B.   The Estate’s Claims Against Employers

     Yaquinto’s action against Employers is also predicated on

Touchstone’s alleged conflict of interest in representing all

three defendants.   The district court granted summary judgment in

favor of Employers because Employers had no independent duty to

look into a conflict of interest and no reason to know of a

conflict on the facts of this case.   On appeal, the estate argues

that it has offered sufficient evidence that Employers acted

unreasonably in failing to hire an independent attorney for

Segerstrom to survive a motion for summary judgment.   This

argument is based on Yaquinto’s belief that “for Employers to

fulfill its duty of reasonable care to [Segerstrom], it was

obligated to hire a separate attorney to represent and advise the

                                17
debtor of her rights, options and exposure.”   We find no basis to

disturb the district court’s judgment.7

     Texas requires that insurance companies act with reasonable

care in fulfilling their duty to defend under insurance

contracts.   See Meridian Oil Production, Inc. v. Hartford

Accident & Indemn. Co., 27 F.3d 150, 153 (5th Cir. 1994); Ranger

County Mut. Ins. Co. v. Guin, 723 S.W.2d 656, 659 (Tex. 1987).

Generally, tort claims alleging breach of this duty have focused

on an insurance company’s failure to settle claims or

interference with possibilities for settlement.   See, e.g., G.A.

Stowers Furniture Co. v. American Indemn. Co., 15 S.W.2d 544, 547

(Tex. Comm’n App. 1929, holding approved).   Even assuming that

Touchstone’s representation of all three defendants in the Colvin

litigation created a conflict of interests, Yaquinto points to no

authority in Texas law suggesting that an insurer’s duty of

reasonable care requires the insurer to independently identify

conflicts and take steps to address them prior to or at the same


     7
       Yaquinto does not address the district court’s holdings
with respect to the breach of fiduciary duty and breach of
contract claims in either its initial or reply brief. On this
basis, we conclude that these claims have been waived. See DSC
Communications Corp. v. Next Level Communications, 107 F.3d 322,
326 n. 2 (5th Cir. 1997). At any rate, the district court
properly resolved the fiduciary duty claim because Texas does not
recognize a fiduciary duty between insurers and their insureds,
only a duty of reasonable care. See Caserotti v. State Farm Ins.
Co., 791 S.W.2d 561, 565 (Tex. App. 1990, writ denied).
Moreover, Yaquinto provided no evidence that Employers’ insurance
contract required independent counsel for Segerstrom, or that
Employers otherwise failed fulfill its contractual obligations.

                                18
time as appointing legal counsel.8   Therefore, unless Employers

disregarded notice from Touchstone of a conflict, a fact that

Yaquinto has no evidence of,9 any liability imposed on Employers

would be vicarious and hence not recognized by Texas law.     See

State Farm Mut. Ins. Co. v. Traver, 980 S.W.2d 625, 628-29 (Tex.

1998).   Moreover, even assuming that Employers had a duty to

prevent the conflict and breached that duty, the estate has

provided insufficient evidence linking the judgment against

Segerstrom to that breach.   Absent such evidence, the estate has

no basis on which to claim damages from Employers.




     8
       While the Texas Supreme Court’s decision in Ranger
contains language suggesting that insurers have a broad
independent duty to investigate, litigate and settle cases on
behalf of insureds, Ranger, 723 S.W.2d at 659 (affirming jury
finding that insurer’s failure to notify insured of settlement
offers constituted direct negligence), the Texas Supreme Court
has consistently limited Ranger, reinforcing that the Stowers
doctrine provides the primary measure of insurer reasonableness
under its duty to defend. See, e.g., American Physicians Ins.
Exchange v. Garcia,, 876 S.W.2d 842, 849 (Tex. 1994) (“[E]vidence
concerning claims investigation, trial defense, and conduct of
settlement negotiations is necessarily subsidiary to the [Stowers
doctrine].”). We will not extend a doctrine that Texas law has
consistently retracted.
     9
       Yaquinto argues that the district court improperly denied
his motion for a Rule 56(f) extension, since the existence of
such a communication is a fact question. However, Yaquinto
points to no additional discovery that might provide evidence of
such a communication. From the record, it is clear that Yaquinto
has already deposed the Employers representative that handled
this case. Moreover, district courts have considerable
discretion in ruling on motions to suspend summary judgment
pending discovery. See Stearns Airport Equipment Co., Inc. v.
FMC Corp., 170 F.3d 518, 534-35 (5th Cir. 1999).

                                19
II.   Denial of the Estate’s Motions to Compel Discovery

      Yaquinto also appeals the district court’s denial of the

estate’s motion to compel discovery of communications between

Segerstrom and Touchstone.   Having concluded that Yaquinto cannot

successfully maintain a legal malpractice claim against

Touchstone for the reasons stated previously, we need not reach

this issue.   Even assuming we were to rule in Yaquinto’s favor,

remand would not be necessary because Yaquinto could not discover

evidence that would support a finding of harm or causation on the

facts of this case.

                               CONCLUSION

      Yaquinto, on behalf of Segerstrom’s bankruptcy estate, has

failed to offer sufficient evidence that Segerstrom (1) suffered

injury in the Colvin litigation, (2) as a consequence of

Touchstone’s representation.    The estate’s claims against

Employers fail because the insurer had no duty to investigate

potential conflicts when fulfilling its obligation to defend

Segerstrom and had no independent knowledge of a conflict that

could support a finding of direct negligence.    Consequently, we

AFFIRM the district court’s grant of summary judgment.




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