Rosenthal v. Allstate Property & Casualty Insurance Co.
712 F. App'x 401
5th Cir.2017Background
- Rosenthal purchased a 1991 RV in 2013, stored it mostly idle at his Louisiana home for ~2 years, and insured it with Allstate.
- He claims a severe rainstorm on or about May 27, 2015 caused water to enter the RV’s vertical exhaust and damage the engine; he filed a claim on June 8, 2015.
- Allstate sent an adjuster, requested a mechanic inspection; Rosenthal submitted an estimate by email but refused additional inspection involving partial disassembly.
- Allstate engaged an SIU mechanical engineer (Jeffrey Stark) who concluded improper storage/maintenance was the most likely cause and that further disassembly inspection was needed to determine the exact cause; Allstate denied the claim for lack of cooperation and insufficient proof of loss.
- Rosenthal sued in Louisiana state court alleging breach of contract, negligent claims handling, negligent misrepresentation, statutory bad-faith under La. Stat. §§ 22:1892/22:1973, and related tort claims; Allstate removed based on diversity and the district court granted summary judgment for Allstate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the policy covers loss from the alleged heavy rain (water) | Rosenthal: engine damage from a severe rainstorm is a covered "water" loss under the policy | Allstate: (implicitly) coverage depends on proof the loss was caused by the covered peril; no sufficient proof here | Covered: the policy language includes "water," and rain can be a covered direct and accidental loss |
| Whether Rosenthal proved the covered peril (rain) actually caused the engine damage | Rosenthal: heavy short-duration rainfall and wind could have funneled water into vertical exhaust causing damage | Allstate: weather records, Rosenthal’s lack of direct observation, Stark’s roof test, and expert opinion show no evidence water entered the exhaust; storage/neglect is more likely | Not proven: Rosenthal failed to produce more than a scintilla of evidence linking the claimed storm/water to the engine damage |
| Whether Rosenthal showed Allstate acted in bad faith under Louisiana law | Rosenthal: Allstate’s denial and handling constituted bad faith and statutory penalties | Allstate: denial was based on insufficiency of proof and refusal to permit necessary inspection; not arbitrary or without probable cause | Not proven: Rosenthal did not provide satisfactory proof of loss and refused further inspection, so no statutory bad-faith claim survives summary judgment |
Key Cases Cited
- Anderson v. Liberty Lobby, 477 U.S. 242 (summary judgment standard; scintilla rule)
- Celotex Corp. v. Catrett, 477 U.S. 317 (party with burden must show essential elements to avoid summary judgment)
- Doerr v. Mobil Oil Corp., 774 So. 2d 119 (La. 2000) (insurance-policy interpretation; ambiguities construed for insured)
- Bayle v. Allstate Ins. Co., 615 F.3d 350 (insured must establish uncompensated damage was caused by a covered peril)
- Versai Mgmt. Corp. v. Clarendon Am. Ins. Co., 597 F.3d 729 (elements for statutory bad-faith claim under Louisiana law)