* 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.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 08-30026

JOHN RUIZ

Plaintiff-Appellant

v.

ALLSTATE INSURANCE COMPANY; PAUL SCAFFIDI INSURANCE

AGENCY, LLC

Defendants-Appellees

Appeal from the United States District Court 

for the Eastern District of Louisiana

USDC No. 2:07-CV-101

Before JOLLY, BARKSDALE, and HAYNES, Circuit Judges.

PER CURIAM:*

John Ruiz appeals the district court’s denial of his motion to remand after

Defendant Allstate removed this case from the Civil District Courtfor theParish

of Orleans based on improper joinder. He also appeals the district court’s

subsequent order summarily enforcing the parties’ purported settlement

agreement. Finding no error, we affirm.

United States Court of Appeals

Fifth Circuit

F I L E D

October 8, 2008

Charles R. Fulbruge III

Clerk
No. 08-30026

2

I. FACTS

Ruiz owns a residence and four rental properties located in New Orleans,

Louisiana. After Hurricane Katrina destroyed the properties, Ruiz, an attorney

licensed to practice in Louisiana, filed a pro se suit against his insurer, Allstate

Insurance Company (Allstate), and his insurance agency, Paul Scaffidi

Insurance Agency, LLC (Scaffidi Agency). Ruiz alleged that Allstate failed to

fully compensate him under his homeowner’s and landlord insurance policies,

and thatthe Scaffidi Agency breached its fiduciary duty by failing to advise Ruiz

of his potential need for flood insurance.

Allstate removed the case to the United States District Court for the

Eastern District of Louisiana, invoking the court’s original diversity jurisdiction.

Ruiz filed a motion to remand, which Allstate opposed on the grounds that Ruiz

improperly joined the non-diverse defendant, the Scaffidi Agency. Allstate

asserted two bases for its improper joinder argument: (1) that Louisiana law

perempted Ruiz’s purported claims against the Scaffidi Agency and,

alternatively, (2) that Ruiz failed to state any cognizable claims against the

Scaffidi Agency.

Ruiz also submitted an affidavit alleging additional facts in support of his

claims. He stated that in the summer of 2004, he became concerned about the

sufficiency of coverage on his residence and rental properties. To allay these

concerns, he contacted his insurance agent, Paul Scaffidi of the Paul Scaffidi

Insurance Agency, and expressed his desire for “full and adequate coverage” on

his properties. The two discussed various coverage options, and Scaffidi

ultimately suggested that Ruiz purchase a new homeowner’s policy with

increased coverage limits. Ruiz did so. Still, Ruiz remained concerned about the

sufficiency of his coverage and attempted to contact Scaffidi several times prior

to Hurricane Katrina, to no avail. Although Ruiz also alleges that Scaffidi did

not inform him that he lacked flood coverage, the only policy in the record
No. 08-30026

1

Indeed, these letters form the basis for Ruiz’s claim that the Scaffidi Agency agreed

to an “undertaking” to procure insurance on which Ruiz relied. This claim would be

nonsensical if Ruiz never got the letters.

3

expressly excludes floods from the definition of covered losses. Additionally, the

record contains five letters from the Scaffidi Agency, corresponding with Ruiz’s

five properties, dated August 26, 2004. Each of these letters informed Ruiz that

his current policies lacked flood coverage and that the Scaffidi Agency could

assist in securing this coverage. Although Ruiz suggested to the district court

that he did not remember receiving these letters, he relies on them extensively

in his appellate brief.1 Finally, while Ruiz’s affidavit only mentions that he

purchased new homeowner’s insurance after speaking with Scaffidi, Ruiz’s

appellate brief and Scaffidi’s affidavit indicate that Ruiz also purchased new

landlord policies.

The district court denied Ruiz’s motion to remand, finding that Ruiz

improperly joined the Scaffidi Agency in an effort to defeat diversity among the

parties. The court concluded that Louisiana law imposes no duty on insurance

agents to identify spontaneously a client’s needs and advise him as to whether

he is underinsured or carries the right type of coverage. The court did not reach

Allstate’s alternative argument that Louisiana law perempted any claims

against the Scaffidi Agency.

Subsequent to the district court’s denial of Ruiz’s motion to remand, the

parties negotiated a settlement of Ruiz’s claims against Allstate. Allstate’s

counsel memorialized the terms of the parties’ settlement agreement in a letter

sent to Ruiz. According to the letter, Allstate agreed to settle Ruiz’s claims for

$202,700 and to pay Ruiz his reasonable court costs. The letter informed Ruiz

that Allstate planned to send him a second letter indicating how Allstate would

allocate the settlement funds amongst Ruiz’s properties “per our discussion.”
No. 08-30026

2 As part of the settlement agreement, the parties agreed that Allstate would pay no

funds for the damage to Ruiz’s residence.

4

The letter concluded by informing Ruiz that he would need to fax a two-line

letter to the court confirming the parties’ settlement. Ruiz did so the same day.

Although Allstate never sent Ruiz the promised letter indicating the

allocation of funds amongst his properties, it delivered to Ruiz five release forms,

one for each ofthe five insured properties, and four corresponding checks, which

Ruiz cashed.2 Despite having cashed these checks, Ruiz refused to execute the

releases because he disagreed with their terms. Specifically, Ruiz alleged that

Allstate had orally agreed to grant Ruiz discretion to allocate the settlement

payment amongst his properties in a manner of his choosing, provided that the

total payment did not exceed $202,700. Ruiz also alleged that he lacked the

capacity to settle his claims because of injuries he suffered in a recent car

accident. However, he provided no support for any implication that his capacity

to consent was impaired. Because Ruiz refused to execute the releases, Allstate

filed a motion to enforce the settlement agreement. The motion to enforce was

originally set for a hearing, but, in its second continuance order following Ruiz’s

request for a continuance, the district court set the matter for consideration “on

the papers.” Ruiz did not object to the resetting “on the papers,” nor did he

request a hearing in his response to Allstate’s motion to enforce. 

The district court summarily enforced the parties’ settlement agreement,

finding that Ruiz’s actions demonstrated that he assented to Allstate’s method

of allocating the settlementfunds. Ruiz filed a motion for reconsideration or new

trial in which he requested, for the first time, an evidentiary hearing to resolve

his challenges to the validity of the settlement agreement. He suggested that

the evidentiary hearing was necessary to consider “how badly Allstate is

shortchanging plaintiff.” The district court denied Ruiz’s motion, noting that it
No. 08-30026

5

had fully considered his arguments and found them to lack merit. This appeal

followed.

II. DISCUSSION

Ruiz challenges both the district court’s order denying his motion to

remand and its order summarily enforcing the parties’ settlement agreement.

Regarding the failure to remand, Ruiz contends that the district court erred in

finding that he improperly joined the non-diverse defendant, the Scaffidi Agency.

Ruiz argues that his petition and subsequent affidavit state viable claims

against the Scaffidi Agency under Louisiana law, namely that the Scaffidi

Agency failed to procure flood insurance for Ruiz after agreeing to do so, or that

the Scaffidi Agency failed to advise Ruiz that he needed flood insurance.

Although Allstate disagrees that Ruiz can state viable claims against the Scaffidi

Agency, it argues that this Court can affirm the district court’s improper joinder

ruling on the alternative grounds that Louisiana law perempted Ruiz’s claims.

Finally, Ruiz argues thatthe district court erred in denying his challenges to the

validity of the parties’ purported settlement agreement without holding an

evidentiary hearing. We address Ruiz’s arguments in turn.

A. Improper Joinder

This Court reviews de novo the denial of a motion to remand to state court.

Campbell v. Stone Ins. Inc., 509 F.3d 665, 669 (5th Cir. 2007). Where the district

court bases its denial of a motion to remand on the plaintiff’s improper joinder

of a non-diverse defendant, we must analyze whether (1) actual fraud exists in

the pleading of jurisdictional facts or (2) the plaintiff is unable to state a viable

claim against the non-diverse defendant. Smallwood v. Ill. Cent. R.R. Co., 385

F.3d 568, 573 (5th Cir. 2004) (en banc). Under the second prong – the only prong

relevant here – this Court must determine “whether the defendant has

demonstrated that there is no reasonable basis for the district court to predict

that the plaintiff might be able to recover against an in-state defendant.” Id. In
No. 08-30026

6

conducting this inquiry, we must resolve all contested facts and ambiguities in

controlling state law in the plaintiff’s favor. Guillory v. PPG Indus., Inc., 434

F.3d 303, 308 (5th Cir. 2005). 

Allstate argues in this appeal, as it did below, that LA. REV. STAT. ANN. §

9:5606(A) (1999) perempts any viable claims that Ruiz might have brought

againstthe Scaffidi Agency. Although the district court did not reach this issue,

we can affirm the district court’s improper joinder ruling on any grounds

supported by the record. See, e.g., Sojourner T v. Edwards, 974 F.2d 27, 30 (5th

Cir. 1992).

In relevant part, § 9:5606(A) states:

No action for damages against any insurance agent, broker,

solicitor, or other similar licensee under this state, whether based

upon tort, or breach of contract, or otherwise, arising out of an

engagement to provide insurance services shall be brought unless

filed in a court of competent jurisdiction and proper venue within

one year from the date of the alleged act, omission, or neglect, or

within one year from the date that the alleged act, omission, or

neglect is discovered or should have been discovered.

Ruiz filed his petition in Louisiana state court on August 29, 2006. Thus, §

9:5606(A) perempts any claims against the Scaffidi Agency that Ruiz discovered

or should have discovered before August 29, 2005, the day Hurricane Katrina

hit.

The peremptive period of § 9:5606(A) began to run on Ruiz’s purported

claim for failure to procure flood insurance when Ruiz discovered or should have

discovered that any new policy procured by the Scaffidi Agency lacked flood

coverage. The Scaffidi Agency procured a new homeowner’s policy for Ruiz with

coverage commencing on September 19, 2004. The exclusions section of the

policy unambiguously states, “[w]e do not cover loss to property . . . consisting

of or caused by . . . [f]lood, including, but not limited to surface water, waves,

tidal water or overflow of any body of water, or spray from any of these, whether
No. 08-30026

7

or not driven by wind.” The policy also contains an advertisement for flood

insurance, which informed Ruiz about the advantages of flood insurance and

explained how he could purchase this additional coverage.

Although Ruiz contends that he assumed that this new policy covered flood

damage, Louisiana law required Ruiz to read the clear provisions of his policy

to the contrary. Motors Ins. Co. v. Bud’s Boat Rental, Inc., 917 F.2d 199, 205

(5th Cir. 1990); Matthews v. Bus. Men’s Assurance Co. of Am., 478 So. 2d 634,

637 (La. Ct. App. 1985). The copy of the homeowner’s policy in the record is

addressed to Ruiz at his residence in New Orleans. While the record does not

contain a mailing receipt, Ruiz admits in his appellate brief that he received a

copy ofthe policy sometime before Hurricane Katrina struck. This Court has the

discretion to treat such statements made in appellate briefs as binding judicial

admissions of fact. City Nat’l Bank & Tex. Bank v. United States, 907 F.2d 536,

544 (5th Cir. 1990). Accordingly, the record conclusively establishes that Ruiz

either knew or should have known that the Scaffidi Agency had failed to procure

flood insurance on his residence when Ruiz received a copy of his new

homeowner’s policy sometime before Hurricane Katrina. Thus, § 9:5606(A)

perempts any claim thatthe Scaffidi Agency failed to procure flood insurance for

Ruiz’s residence.

The same basic analysis applies to Ruiz’s claim that the Scaffidi Agency

failed to procure flood insurance for Ruiz’s rental properties. According to

Scaffidi’s affidavit, he procured new insurance policies for Ruiz’s four rental

properties in June or July of 2004. Scaffidi states that he mailed copies of those

policies to Ruiz, and Ruiz admits in his appellate brief that he received those

copies. Although the landlord policies are not contained in the record, both

parties agree that the policies did not cover flood damage. As mentioned,

Louisiana law charges Ruiz with knowledge of his insurance policies. Matthews,

478 So. 2d at 637. In addition, the Scaffidi Agency sent Ruiz correspondence
No. 08-30026

8

dated August 26, 2004 that informed Ruiz that none of his insurance policies

covered flood damage. In his appellate brief, Ruiz relies upon these letters to

support his claim; he should not, then, be permitted to deny their existence. It

is clear that Ruiz knew or should have known some time prior to Hurricane

Katrina that his new landlord policies did not cover flood damage. Accordingly,

§ 9:5606(A) perempts this claim as well.

Alternatively, Ruiz argues that the Scaffidi Agency’s August 2004 letters

somehow constituted a separate undertaking to procure flood insurance. The

face of the letters belies this argument. The letters simply informed Ruiz that

each of his properties lacked flood coverage and that the Scaffidi Agency could

assist in securing this coverage. No reasonable jury could conclude that these

letters are anything other than advertisements for flood insurance. But even if

these letters constituted an August 2004 undertaking to procure flood insurance

for Ruiz’s rental properties, § 9:5606(A) would perempt any claim based on the

letters. Ruiz alleges that, prior to Hurricane Katrina (i.e., more than one year

before he filed suit), he attempted, on multiple occasions, to call the Scaffidi

Agency about his coverage, to no avail. He does not contend that he received a

policy purporting to cover flood loss or any other indication that the Scaffidi

Agency complied with his purported “undertaking.” While the exact date on

which Ruiz knew or should have known that the Scaffidi Agency had failed to

procure post-August 2004 flood insurance for Ruiz’s rental properties is unclear,

it is certainly within one year of the letters and certainly before he made the

many phone calls he alleges, all of which occurred more than one year before

suit. For these same reasons, § 9:5606(A) also perempts any claim based on the

Scaffidi Agency’s alleged failure to inform Ruiz of the need for flood coverage.

In sum, § 9:5606(A) perempts any claim that Ruiz could bring based on the

Scaffidi Agency’s purported failure to procure or advise of the need for flood

insurance prior to August 29, 2005, the last relevant date for our purposes.
No. 08-30026

3 Ruiz also challenges the district court’s jurisdiction to enforce the settlement

agreement. Having found jurisdiction, this challenge is unavailing.

4 Ruiz also contends, for the first time in his reply brief, that there is insufficient

evidence of a settlement agreement under Louisiana law. Ruiz waived this argument by

failing to raise it in his original brief. United States v. Jackson, 426 F.3d 301, 304 n.2 (5th Cir.

2005) (“Arguments raised for the first time in a reply brief . . . are waived.”). Regardless, the

argument is devoid of merit.

9

B. Enforcement of Settlement Agreement

Ruiz also contends that the district court abused its discretion by failing

to afford an evidentiary hearing on his challenges to the validity of the parties’

purported settlement agreement.3 Despite notice that the court would not hold

a hearing, Ruiz did not object to the district court’s setting of Allstate’s motion

to enforce “on the papers,” nor did he request an evidentiary hearing in his

response to that motion. Rather, Ruiz raised the issue of an evidentiary hearing

for the first time in his motion for reconsideration of the district court’s

enforcement order. Because Ruiz filed that motion within ten days of the order,

the district court properly treated it as a motion to amend or alter its judgment

under FED. R. CIV. P. 59(e). See United States v. One 1988 Dodge Pickup, 959

F.2d 37, 40 (5th Cir. 1992) (motion that calls into question the correctness of the

court’s ruling is treated as a motion under Rule 59(e)). We have held that Rule

59 motions “cannot be used to raise arguments which could, and should, have

been made before the judgment issued.” Simon v. United States, 891 F.2d 1154,

1159 (5th Cir. 1990) (citation omitted). Accordingly, Ruiz waived any right to an

evidentiary hearing, and the district court did not err in denying his postjudgment request.4

Id. In any event, the evidence supports the district court’s

enforcement of the settlement.

AFFIRMED.