Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca5-15-20213/USCOURTS-ca5-15-20213-0/pdf.json

Parties Involved:
Evanston Insurance Company
Appellee
Lapolla Industries, Incorporated
Appellant

Document Text:

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 15-20213

EVANSTON INSURANCE COMPANY, 

 Plaintiff - Appellee

v.

LAPOLLA INDUSTRIES, INCORPORATED, 

 Defendant - Appellant

Appeal from the United States District Court

for the Southern District of Texas

USDC No. 4:13-CV-3157

Before DAVIS, BARKSDALE, and DENNIS, Circuit Judges.

PER CURIAM:*

Defendant-Appellant Lapolla Industries, Incorporated (“Lapolla”) 

appeals from the district court’s grant of summary judgment in favor of 

Plaintiff-Appellee Evanston Insurance Company (“Evanston”), declaring that 

Evanston owes no duty to defend Lapolla in a lawsuit brought against Lapolla 

 

* 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.

United States Court of Appeals

Fifth Circuit

FILED

December 23, 2015

Lyle W. Cayce

Clerk

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and other defendants in Connecticut. On de novo review, applying the same 

Rule 56 standards as the district court,1 we affirm for the reasons set out below.

In its memorandum opinion and order entered on February 23, 2015, the 

district court summarized the background, which is not in dispute, as follows:

Lapolla Industries, a citizen of Texas and Delaware, 

manufactures spray polyurethane foam (“SPF”) 

insulation. Evanston Insurance Company, a citizen of 

Illinois, issued Lapolla three insurance policies, two 

commercial general liability (“CGL”) policies and one 

excess liability policy. The policies required Evanston 

to defend Lapolla against underlying suits seeking 

damages for bodily injury or property damage caused 

by Lapolla’s products. The policies also obligated 

Evanston to indemnify Lapolla for these damages. The 

policies excluded coverage for damages for bodily 

injury or property damage that “would not have 

occurred in whole or in part but for the actual, alleged 

or threatened discharge, dispersal, seepage, 

migration, release or escape of pollutants at any time.”

The policies defined “pollutants” as “any solid, liquid, 

gaseous or thermal irritant or contaminant, including 

smoke, vapor, soot, fumes, acids, alkalis, chemicals, 

electromagnetic fields and waste.”

This lawsuit stems from underlying litigation arising 

from Lapolla insulation installed during a home 

renovation. In April 2010, during a covered period, the 

plaintiffs’ renovation contractors installed Lapollamanufactured SPF insulation in the part of a home 

owned by Michael and Kimberly Commaroto that was 

being renovated. The Commarotos and their house 

guest, Gretchen Schlegel, were not living in the part of 

the home undergoing renovations. They complained 

that shortly after the insulation was installed in a 

renovated room, they smelled odors and suffered 

respiratory distress, causing them to leave the home. 

Attempts to return triggered the same respiratory 

 

1 Berquist v. Washington Mut. Bank, 500 F.3d 344, 348 (5th Cir. 2007).

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distress symptoms. The plaintiffs moved out 

permanently, leaving their personal property.

In April 2012, the plaintiffs sued the general 

contractor and various subcontractors for negligence 

and breach of contract. Michael A. Commaroto, 

Kimberly S. Commaroto and Gretchen Schlegel v. 

Pasquale Guzzo, AKA Pasqualino Guzzo d/b/a PDB 

Home Improvement, Perfect Wall, LLC and Jozsef 

Finta, No. FST–CV12–6013645S, Judicial Dist.

Stamford, Ct. In July 2012, the contractors filed an 

apportionment complaint and a third-party complaint 

against Lapolla. In the plaintiffs’ second amended 

complaint, filed in April 2013, they also asserted a 

products-liability claim against Lapolla, alleging that 

it manufactured, sold, and marketed its SPF 

insulation in a defective and unreasonably dangerous 

manner.

In 2013, Evanston filed this diversity-jurisdiction suit 

in Texas federal court. Evanston sought a declaratory 

judgment that it has no duty to defend or indemnify 

Lapolla because of the policies’ pollution exclusions. 

After Evanston amended its complaint, Lapolla 

answered and counterclaimed for a declaratory 

judgment that Evanston was obligated to defend and 

indemnify. In April and May 2014, Evanston and 

Lapolla cross-moved for summary judgment.2

Both parties agree that this dispute falls under Texas law, under which 

a court must interpret the insurance contract using the ordinary rules for 

contract interpretation.3 The insured has the initial burden of proving 

coverage.4 If so, the insurer then bears the burden of proving that a policy 

 

2 Evanston Ins. Co. v. Lapolla Indus., Inc., 93 F. Supp. 3d 606, 609-10 (S.D. Tex. 2015)

(footnote and record citations omitted).

3 Id. at 611-12 (citing, among other cases, Sharp v. State Farm Fire & Cas. Ins. Co., 

115 F.3d 1258, 1260 (5th Cir. 1997); Fiess v. State Farm Lloyds, 202 S.W.3d 744, 748 (Tex.

2006); and Lamar Homes, Inc. v. Mid–Continent Cas. Co., 242 S.W.3d 1, 8 (Tex. 2007)).

4 Id. at 612 (citing Nat’l Union Fire Ins. Co. of Pittsburgh, Penn. v. Puget Plastics 

Corp., 532 F.3d 398, 401 (5th Cir. 2008)).

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exclusion bars coverage.5 If the insurer is successful, then the burden shifts 

back to the insured to prove that the claim at issue falls under an exception to 

the exclusion.6 Central to this dispute is the eight-corners rule, which “provides 

that when an insured is sued by a third party, the liability insurer is to 

determine its duty to defend solely from [the] terms of the policy and the 

pleadings of the third-party claimant.”7 In this case, therefore, we look to the 

four corners of the applicable policies and the four corners of the Commaroto 

complaint. Lapolla is entitled to coverage if it can demonstrate any covered, 

non-excluded claim asserted in the Commaroto complaint. It cannot.

As noted above, the policies at issue include total pollution exclusion that 

excludes coverage for:

f. Pollution

(1) “Bodily Injury” or “property damage” which would 

not have occurred in whole or part but for the actual, 

alleged or threatened discharge, dispersal, seepage, 

migration, release or escape of pollutants at any time.

....

Pollutants mean any solid, liquid, gaseous or thermal 

irritant or contaminant, including smoke, vapor, soot, 

fumes, acids, alkalis, chemicals, electromagnetic fields 

and waste. Waste includes materials to be recycled, 

reconditioned or reclaimed.8

As the district court explained, Texas courts have held that such exclusions are 

not ambiguous.9 “The key is whether the plaintiffs’ operative pleading 

 

5 Id. (citing Puget Plastics Corp., 532 F.3d at 404).

6 Id. (citing Century Sur. Co. v. Hardscape Constr. Specialties, Inc., 578 F.3d 262, 265 

(5th Cir. 2009)).

7 Id. (quoting GuideOne Elite Ins. Co. v. Fielder Rd. Baptist Church, 197 S.W.3d 305, 

307 (Tex. 2006)). 8 Evanston, 93 F. Supp.3d at 614 (quoting policies).

9 Id. (citing Noble Energy, Inc. v. Bituminous Cas. Co., 529 F.3d 642, 646 (5th Cir. 

2008); Nat’l Union Fire Ins. Co. of Pittsburgh, PA v. CBI Indus., 907 S.W.2d 517, 521 (Tex. 

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allegations fall within the pollution exclusion’s plain terms—that is, whether 

the allegations about what ‘caused the [plaintiffs’] injuries arose out of [the 

actual, alleged, or threatened] discharge, dispersal, release or escape of 

pollutants.’”10

Turning to the Commaroto complaint, the district court quoted 

extensively from what it determined to be the relevant facts: those set out in 

the general “Summary of Facts” section and those in the single products 

liability count against Lapolla. Although Lapolla argued below and on appeal 

that the district court should have restricted its inquiry to only the count 

against Lapolla and the five paragraphs from the “Summary of Facts”

specifically incorporated by reference into that count, our de novo review 

convinces us that there is no material difference between the sets of facts.11

Because there is no material difference between the two sets of facts, this 

argument is irrelevant.

The district court summarized the operative facts as follows:

The plaintiffs’ operative pleading alleges that vapors 

from the SPF insulation caused their bodily injuries 

and property damage. According to the second 

amended complaint, the defendants “failed to seal off 

completely areas in which vapors could be transported

from the areas under renovation and construction to 

the existing area[] of the house[,] in which the 

Commarotos, their three minor children, and their 

houseguest, Schlegel, were living and sleeping during 

the construction process.” (Docket Entry No. 24, ¶ 30). 

As a result, the plaintiffs allegedly suffered adverse 

health effects, incurred costs in investigating and 

 

1995); and Zaiontz v. Trinity Universal Ins. Co., 87 S.W.3d 565, 571 (Tex.App.-San Antonio 

2002, pet. denied)).

10 Id. (quoting Noble, 529 F.3d at 646; some internal quotation marks omitted).

11 It is curious that Lapolla seeks to ignore most of the “Summary of Facts” section, 

which unquestionably provides context for the entire Commaroto lawsuit, while 

simultaneously arguing that it should be allowed to introduce extrinsic evidence.

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remediating the situation, and suffered property 

losses in the form of personal belongings affected by 

the vapor and their inability to use their newly 

renovated home. (See id., ¶¶ 31 (describing the failure 

to contain “vapors” from the SPF insulation), 38 

(alleging a “strong odor” and “symptoms of respiratory 

distress”), 41 (“respiratory distress”), 45 (“upper 

respiratory injury”), 46 (“exposure to” the residence 

and property within it “at the time” of the SPF 

installation), 48 (loss of possessions “that were present 

in the home at the time of the installation of the SPF 

insulation”), 49 (costs incurred for “alternative living, 

food, property, clothes, [and] medical expenses” and 

“to investigate and remediate the damage causes”), 

158 (“upper respiratory injury”), 159 (“exposure to 

their residence itself and from exposure to the 

personal property that was present ... at the time the 

product was installed”), 162 (“costs to investigate and 

remediate the damages caused by the use of the 

product in the home”).12

Thus, in the district court’s reading, all of the allegations in the Commaroto 

complaint fell under the pollution exclusion, and Evanston is therefore entitled 

to entry of a final judgment declaring that it has no duty to defend Lapolla in 

the Commaroto suit. We agree. A plain reading of the complaint shows that all 

of the plaintiffs’ injuries, both personal injury and property damage, were 

alleged to have been caused by “pollution” as defined by the policies.

We also agree with the district court’s assessment of Lapolla’s 

arguments, which Lapolla continues to assert on appeal:

Lapolla points to the plaintiffs’ allegations about the 

“presence of the product in their home” and argues 

that these allegations do not trigger the pollution 

exclusion. Lapolla contends that the second amended 

complaint “makes a clear distinction between alleged

injuries and damages resulting from SPF installed in 

 

12 Evanston, 93 F. Supp.3d at 618.

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their home versus those allegedly caused by ‘vapors’

allegedly released from the SPF after it was installed.”

The distinction is between the harm caused by the 

mere presence of the SPF in the part of the home 

undergoing renovations, as opposed to the harm 

caused by the release of vapors to the parts of the home 

where the plaintiffs were living, including the guest 

room adjacent to the room in the renovation area 

where the insulation was sprayed.

Lapolla distinguishes between damage from exposure 

to vapors resulting from the installation process used 

by the defendants,[] and one plaintiff’s “expos[ure] for 

hours to the newly—applied SPF insulation.” The 

second allegation, Lapolla contends, suggests harm 

from physical contact or the mere presence of the SPF 

in the part of the home undergoing renovation, rather 

than harm from the release of vapors from that part of 

the home to the rest of the residence where the 

plaintiffs were living and their personal possessions 

were located. The allegations undermine this 

distinction. The allegations include that “[b]efore 

beginning the application of the SPF insulation, the 

defendants failed to seal off completely areas in which 

vapors could be transported from the areas under 

renovation and construction to the existing areas of 

the house in which the Commarotos, their three minor 

children, and their houseguest, Schlegel, were living 

and sleeping during the construction process.” The 

factual allegations about the Lapolla SPF insulation 

make clear that it was present only in the part of the 

house undergoing renovation, and that the bodily 

harm to the Commarotos and their guest, and the 

damage to their personal property, occurred when 

vapors migrated to the rooms where the Commarotos 

lived and their guest was staying.13

As the district court properly explained, not only is Lapolla’s reading factually 

unsupported by the complaint, but case law supports the conclusion that the 

 

13 Id. at 618-19 (citations to record omitted).

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alleged damages arose from “the release and migration of [the insulation’s] 

vapors” rather than from “the presence of the insulation itself.”14 Based on a

plain reading of the Commaroto complaint, we must conclude that all of the 

alleged injuries arose from “pollution,” as defined by the policies, and are thus 

excluded.

On appeal, Lapolla has attempted to refine its position, arguing: “To be 

sure, the Commarotos could still argue that although the ‘unsafe and 

dangerous’ SPF may not pose a health risk, like asbestos, left undisturbed, it 

may still negatively affect the value of their home.” But that argument misses 

the point of the eight-corners rule: we must examine the complaint as it exists 

now, not as it might exist under different circumstances. As currently pleaded, 

every claim in the Commaroto complaint falls under the pollution exclusion, 

and none falls under an exception to that exclusion.

Finally, Lapolla argues that we should apply an exception to the eightcorners rule that would allow us to look beyond the factual allegations in the 

complaint to extrinsic evidence—specifically, deposition testimony by two of 

the plaintiffs stating that they physically touched and examined the spray 

foam insulation. Lapolla concedes that the district court applied the correct 

standard for this exception under Star-Tex Resources, L.L.C. v. Granite State 

Insurance Co., 553 F. App’x 366 (5th Cir. 2014), i.e., that the court may only 

look beyond the eight corners of the complaint and policy to extrinsic evidence 

“when it is initially impossible to discern whether coverage is potentially 

implicated and when the extrinsic evidence goes solely to a fundamental issue 

of coverage which does not overlap with the merits of or engage the truth or 

falsity of any facts alleged in the underlying case.”15 Lapolla argues that 

 

14 Id. at 619-20 (discussing Hamm v. Allstate Ins., Co., 286 F. Supp. 2d 790 (N.D. Tex.

2003); and Nautilus Ins. Co. v. Country Oaks Apts. Ltd., 566 F.3d 452, 457 (5th Cir. 2009)).

15 553 F. App’x at 371.

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extrinsic evidence is allowed because, in its view, it is impossible to tell from 

the Commaroto complaint whether the plaintiffs’ personal injuries were caused 

by physical contact with the insulation or vapors. As set out above, we conclude 

otherwise. The Commaroto complaint entirely concerns damages from vapors

and says nothing to suggest damages from physical contact with the spray 

foam insulation. Because it is not “impossible to discern whether coverage is 

potentially implicated,” Lapolla cannot satisfy the first part of the test.

Accordingly, the district court properly excluded the extrinsic evidence.

Following de novo review of the summary judgment record, we reach the 

same conclusion reached by the district court in its excellent and thorough 

opinion. We conclude, essentially for the reasons set out in that opinion as 

supplemented above, that Evanston is entitled to a judgment declaring that 

Evanston owes no duty to defend Lapolla in the Commaroto suit.

AFFIRMED.

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