     Case: 10-30950     Document: 00511642943         Page: 1     Date Filed: 10/24/2011




            IN THE UNITED STATES COURT OF APPEALS
                     FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                     Fifth Circuit

                                                                            FILED
                                                                         October 24, 2011

                                       No. 10-30950                        Lyle W. Cayce
                                                                                Clerk

C.R. PITTMAN CONSTRUCTION COMPANY, INCORPORATED; C.R.
PITTMAN,

                                                  Plaintiffs-Appellants,
v.

NATIONAL FIRE INSURANCE COMPANY OF HARTFORD, as Successor
by Merger to Transcontinental Insurance Company,

                                                  Defendant-Appellee



                   Appeal from the United States District Court
                      for the Eastern District of Louisiana
                                No. 2:07-CV-4534


                      ON PETITION FOR PANEL REHEARING

Before SMITH, BENAVIDES, and HAYNES, Circuit Judges.
PER CURIAM:*
        We GRANT Appellee’s petition for panel rehearing and issue the following
opinion in place of our September 30, 2011 opinion.
        Pittman Construction Company (“Pittman Construction”) appeals the
district court’s grant of summary judgment to National Fire Insurance Company


        *
         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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.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. 10-30950

of Hartford (“National”) on Pittman Construction’s claim that National breached
an insurance contract by failing to reimburse Pittman Construction for damages
to equipment caused by Hurricane Katrina. For the following reasons, we
AFFIRM in part, REVERSE in part, and REMAND for further proceedings
consistent with this opinion.
     I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY
      Pittman Construction had two contracts, the Dwyer Contract and the
Cousins Contract, with the U.S. Army Corps of Engineers (the “Corps”) to
complete two projects. Pittman Construction stored certain equipment to be
installed as part of the pumping units for the projects both inside and outside of
its warehouse in New Orleans, Louisiana. Pittman Construction acquired an
“all risks” insurance policy from National covering at least some of that
equipment. The policy was in effect at the time Hurricane Katrina hit New
Orleans in 2005. Pittman Construction’s equipment was damaged, and Pittman
Construction filed suit against National under the policy. The parties dispute
whether the damage was caused by Katrina-related rain and wind or flooding,
the latter being excluded from coverage under the insurance policy.1
      Both parties moved for summary judgment. In support of its motion and
in opposition to National’s motion, Pittman Construction submitted two
affidavits from the company’s owner, Jay Pittman, Jr. (“Pittman”). In the second


      1
          The policy states the following:

      B. EXCLUSIONS

               1. We will not pay for “loss” caused directly or indirectly by any of the following.
               Such “loss” is excluded regardless of any other cause or event that contributes
               concurrently or in any sequence to the “loss.”

                       b. Water
                             (1) Flood, surface water, waves, tides, tidal waves, overflow of
                             any body of water, or their spray, all whether driven by wind or
                             not[.]

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                                       No. 10-30950

affidavit, Pittman stated that he was actually present at the Pittman
Construction facility when Hurricane Katrina hit, and that wind tore off parts
of the side and roof of the company’s warehouse such that rain destroyed the
insured property before any flooding occurred. Pittman Construction also
provided an affidavit from Donald Ellis, Jr. (“Ellis”), an electrical contractor, who
averred that, after wind blew away the tarp covering the generators in Pittman
Construction’s yard, the rain destroyed them. Ellis’s affidavit was not based
upon contemporaneous observation.2 National moved to strike Ellis’s affidavit
because Pittman Construction had failed to provide an expert report by Ellis by
the deadline set in the district court’s scheduling order and because the affidavit
failed to comply with the reliability standards for expert testimony established
in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993).
       National moved for summary judgment on the flood exclusion. In a suit
it filed against the Corps, Pittman Construction had alleged that defects in the
levee system caused flooding that destroyed Pittman Construction’s equipment.
Thus, National contended that Pittman Construction was judicially estopped
from denying that the damages were caused by flooding.
       Additionally, in opposition to Pittman Construction’s motion for summary
judgment and in further support of its own motion, National provided a two-page
affidavit from William Blackwell, an employee of Jefferson Parish and a
mechanical specialist.         Blackwell conducted an investigation in October
2006—over a year after Hurricane Katrina—of equipment to be installed at one
of the sites pursuant to the Cousins Contract. Blackwell opined that “rain would
not have caused the type of damages sustained by the equipment. The water
damage to the equipment would only have occurred as a result of the equipment


       2
         The affidavit also said that the destruction of the generators “took place long before
the flood waters of Hurricane Katrina occurred as a result of breaches in the New Orleans
levee system.”

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                                  No. 10-30950

being submerged in water.” Pittman Construction did not object to this affidavit
until its motion to alter or amend the judgment.
      The district court granted National’s motion for summary judgment and
dismissed Pittman Construction’s suit. The district court found the Pittman
affidavits insufficient to create a fact issue because “mere allegations in the form
of patently self-serving affidavits do not create an issue of fact precluding
summary judgment.”       The district court also struck the Ellis affidavit on
timeliness grounds alone. Furthermore, the court found that the Blackwell
affidavit demonstrated that flooding caused or contributed to the damage to the
equipment, and therefore, triggered the policy’s anti-concurrent causation
clause. Pittman Construction filed a Rule 59(e) motion to alter or amend the
judgment, which the district court denied. Pittman Construction appealed.
                         II. STANDARD OF REVIEW
      This court reviews a grant of summary judgment de novo, applying the
same standard as the district court. Gelin v. Hous. Auth. of New Orleans, 456
F.3d 525, 527 (5th Cir. 2006). Summary judgment is appropriate if the moving
party can show 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
factual dispute is ‘genuine’ where a reasonable party would return a verdict for
the non-moving party.” Chiu v. Plano Indep. Sch. Dist., 339 F.3d 273, 282 (5th
Cir. 2003) (citation omitted). “An issue is material if its resolution could affect
the outcome of the action.” Weeks Marine, Inc. v. Fireman’s Fund Ins. Co., 340
F.3d 233, 235 (5th Cir. 2003) (citing Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 248 (1986)). In considering a summary judgment motion, this court views
the evidence in the light most favorable to the non-moving party. United Fire
& Cas. Co. v. Hixson Bros. Inc., 453 F.3d 283, 285 (5th Cir. 2006). However,
“[u]nsubstantiated assertions, improbable inferences, and unsupported



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                                   No. 10-30950

speculation are not sufficient to defeat a motion for summary judgment.” Brown
v. City of Houston, 337 F.3d 539, 541 (5th Cir. 2003).


                               III. DISCUSSION
      “‘Under Louisiana law, ‘[a]n insurance policy is a contract between the
parties and should be construed by using the general rules of interpretation of
contracts set forth in the Louisiana Civil Code.’” Bilbe v. Belsom, 530 F.3d 314,
315 (5th Cir. 2008) (quoting In re Katrina Canal Breaches Litig., 495 F.3d 191,
206 (5th Cir. 2007) (citation omitted)). “‘If the policy wording at issue is clear
and unambiguously expresses the parties’ intent, the insurance contract must
be enforced as written.’” Id. (quoting In re Katrina Canal Breaches Litig., 495
F.3d at 207 (citation omitted)).
      In addition, “‘Louisiana law . . . places the burden on the plaintiff [insured]
to establish every fact essential to recovery and to establish that the claim falls
within the policy coverage.’” Williams v. Allstate Indem. Co., 359 F. App’x 471,
473 (5th Cir. 2009) (per curiam) (unpublished) (quoting Ho v. State Farm Mut.
Auto Ins. Co., 862 So. 2d 1278, 1281 (La. Ct. App. 2003)). “Once he has done
this, the insurer has the burden of demonstrating that the damage at issue is
excluded from coverage.” Dickerson v. Lexington Ins. Co., 556 F.3d 290, 295 (5th
Cir. 2009); Doerr v. Mobil Oil Corp., 774 So. 2d 119, 124 (La. 2000) (stating that
once the insured meets its burden to show that the loss is covered by the policy,
“the insurer bears the burden of proving the applicability of an exclusionary
clause within a policy”), modified on other grounds on reh’g, 782 So. 2d 573 (La.
2001). Because this policy was an “all risks” policy, Pittman Construction was
required only to show damage during the policy period. See In re Katrina Canal
Breaches Litig., 495 F.3d at 208 (citation omitted) (stating that an “all-risks”
policy provides “a special type of coverage that extends to risks not usually
covered under other insurance; recovery under an all-risk policy will be allowed

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                                      No. 10-30950

for all fortuitous losses not resulting from misconduct or fraud, unless the policy
contains a specific provision expressly excluding the loss from coverage”). The
burden then shifted to National to prove that the damages were caused by an
excluded peril. Dickerson, 556 F.3d at 295; Doerr, 774 So. 2d at 124; Dawson
Farms, L.L.C. v. Millers Mut. Fire. Ins. Co., 794 So. 2d 949, 951 (La. Ct. App.
2001).
       On appeal, Pittman Construction argues that the district court erred in
failing to consider the Pittman affidavits as competent summary judgment
evidence raising at least a fact issue as to whether wind and rain, rather than
flooding, caused the damage to the equipment.3 The district court found that the
affidavits provided no foundation for the assertion that the hurricane destroyed
the equipment before the flood. The court also rejected the affidavits as patently
self-serving. Because the district court also struck the Ellis affidavit that
Pittman Construction submitted, the district court found no competent summary
judgment evidence creating a fact issue as to the cause of the damage to the
equipment.
       To the extent that the district court chose not to consider the Pittman
affidavits because they were “self-serving,” this ruling was in error. A party’s
own testimony is often “self-serving,” but we do not exclude it as incompetent for
that reason alone. See Rushing v. Kan. City S. Ry., 185 F.3d 496, 513 (5th Cir.
1999), superseded by FED. R. EVID. 103(a) on other grounds as recognized in
Mathis v. Exxon Corp., 302 F.3d 448, 459 n.16 (5th Cir. 2002) (“[M]erely claiming
that the evidence is self-serving does not mean we cannot consider it or that it
is insufficient. Much evidence is self-serving and, to an extent, conclusional.”)
Instead, an affidavit based on personal knowledge and containing factual


       3
        Pittman Construction provided Pittman’s first affidavit in support of its motion for
summary judgment. Pittman’s second affidavit, which contained additional facts, was filed
by Pittman Construction in opposition to National’s motion for summary judgment.

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assertions suffices to create a fact issue, even if the affidavit is arguably self-
serving. See, e.g., Payne v. Pauley, 337 F.3d 767, 773 (7th Cir. 2003) (“Provided
that the evidence meets the usual requirements for evidence presented on
summary judgment—including the requirements that it be based on personal
knowledge and that it set forth specific facts showing that there is a genuine
issue for trial—a self-serving affidavit is an acceptable method for a non-moving
party to present evidence of disputed material facts.”); Santiago-Ramos v.
Centennial P.R. Wireless Corp., 217 F.3d 46, 53 (1st Cir. 2000) (“[A] ‘party’s own
affidavit, containing relevant information of which he has first-hand knowledge,
may be self-serving, but it is nonetheless competent to support or defeat
summary judgment.’” (quoting Cadle Co. v. Hayes, 116 F.3d 957, 961 n.5 (1st Cir.
1997))); Harris v. J.B. Robinson Jewelers, 627 F.3d 235, 239 (6th Cir. 2010) (“A
court may not disregard evidence merely because it serves the interests of the
party introducing it.”); Williams v. Shields, 77 F. App’x 501, 503 (10th Cir. 2003)
(unpublished) (“As long as an affidavit is ‘based upon personal knowledge and
sets forth facts that would be admissible in evidence,’ . . . such averment of a
party is legally competent to oppose summary judgment, notwithstanding its
inherently self-serving nature.” (internal citation omitted)). If all “self-serving”
testimony were excluded from trials, they would be short indeed.
       Pittman’s affidavits assert that he was present at the warehouse and saw
the wind tear off parts of the roof and siding of the building, thereby allowing
rain to enter. The affidavits also asserted that it was well-known in the industry
that the generators were sensitive to water and would be destroyed if certain
parts became wet.4 Although arguably “self-serving,” the affidavits are not


       4
         National did not argue that Pittman’s affidavits contained improper expert testimony.
“Under [Federal Rule of Evidence] 701, ‘[a] lay opinion must be based on personal perception,
must be one that a normal person would form from those perceptions, and must be helpful to
the [fact finder].’” Nat’l Hispanic Circus, Inc. v. Rex Trucking, Inc., 414 F.3d 546, 551 (5th Cir.
2005). Notably, “Rule 701 does not exclude testimony by corporate officers or business owners

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                                       No. 10-30950

wholly conclusory, are based on personal knowledge, and create a fact issue as
to the cause of the damage to the equipment. See Sauquoit Fibers Co. v. Leesona
Corp. (In re Yarn Processing Patent Validity Litig.), 498 F.2d 271, 287 (5th Cir.
1974) (finding that the district court erred in disregarding “self-serving
comments” that created a fact issue; noting that “[q]uestions of credibility should
not normally be decided by means of summary judgment but should be left for
the trier of fact”). Accordingly, the district court erred in disregarding the
Pittman affidavits. Because the Pittman affidavits created a fact issue as to the
sole cause of damage to some of the equipment, summary judgment for National
was improper.
       We recognize that National also argues judicial estoppel as a basis for
affirming the summary judgment. However, at the time summary judgment was
granted, the proceedings before the Corps were ongoing, making the record
insufficiently developed for us to consider judicial estoppel at this point. Thus,
we leave this matter for the district court to address upon a complete record on
remand.
       In light of the unobjected-to affidavit of Blackwell, however, we cannot
conclude that the district court erred in denying summary judgment to Pittman.
With respect to the striking of the Ellis affidavit, because that ruling was based
upon a timetable since changed by the fact of the summary judgment and this
appeal, we leave consideration or reconsideration of that ruling to the district
court on remand in the first instance.
       Finally, we affirm the district court’s granting of summary judgment in
favor of National as to the small tools and equipment coverage and debris



on matters that relate to their business affairs, such as industry practices and pricing.” Id.
at 551-52; see also Tex. A&M Research Found. v. Magna Transp., Inc., 338 F.3d 394, 403 (5th
Cir. 2003) (“Indeed, an officer or employee of a corporation may testify to industry practices
and pricing without qualifying as an expert.”).

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                                        No. 10-30950

removal coverage. Pittman Construction had the burden of proof to establish
coverage for the small tools and equipment, as the policy does not include those
items unless certain conditions are met.5 See Doerr, 774 So. 2d at 124 (“When
determining whether or not a policy affords coverage for an incident, it is the
burden of the insured to prove the incident falls within the policy’s terms.”).
There is no indication that the small tools and equipment listed in the schedule
were submitted to National for calculation of a premium. Nor did Pittman
Construction provide evidence corroborating the statement in one of Pittman’s
affidavits that the tools and equipment were part of the contract price. Compare
United States v. Lawrence, 276 F.3d 193, 197 (5th Cir. 2001) (finding that an
affidavit testifying that a third party paid the defendant’s debt for him was not
sufficient to create a genuine issue of material fact as to whether loans had been
paid in full, as the defendant produced no evidence of the payment), and State
Farm Fire & Cas. Co. v. Delta Beverage Grp. Inc., 401 F. App’x 955, 959 (5th Cir.
2010) (per curiam) (unpublished) (finding that an affidavit, without
corroborating evidence, stating that neither the affiant nor his employees
plugged a cooler into an extension cord was insufficient to defeat summary
judgment because, among other reasons, the affiant could not have personal
knowledge of all the actions of his employees over a two-year period), with
Ellipse Commc’ns., Inc. v. Caven, No. 3-07-CV-1922-0, 2009 U.S. Dist. LEXIS
96582, at *4 (N.D. Tex. Oct. 16, 2009) (distinguishing the “legless alibi”
submitted in Lawrence from the affidavit submitted by a party that described
detailed, recent transactions among institutions whose representatives would
be readily available, together with records, for further discovery to prove or
disprove assertions made).


       5
         The policy specifically does not provide coverage for “[p]roperty which will not become
part of the installation, except tools and equipment for which the costs: (1) [i]s included in the
contract price; and (2) [h]as been reported to us for premium purposes[.]

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                                 No. 10-30950

      Although the Pittman affidavits raised a fact issue as to whether rain
alone destroyed the generators, they did not indicate that the small tools and
equipment were destroyed by a covered peril. Thus, the summary judgment for
National regarding coverage for the small tools and equipment was proper.
Similarly, Pittman did not raise a fact issue with respect to compliance with the
conditions precedent as to debris removal coverage.
                             IV. CONCLUSION
      Based on the foregoing, we AFFIRM the summary judgment as to the
small tools and equipment coverage and debris removal coverage, and REVERSE
the summary judgment as to the remaining issues. We REMAND for further
proceedings consistent with this opinion.




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