Court Opinion

ID: 42979
Source: CourtListenerOpinion
Date Created: 2010-04-25 21:43:23+00
Date Added: 2024-06-11T17:16:57.913019
License: Public Domain

United States Court of Appeals
                                                                Fifth Circuit
                                                             F I L E D
              IN THE UNITED STATES COURT OF APPEALS
                                                               May 23, 2006
                      FOR THE FIFTH CIRCUIT
                                                         Charles R. Fulbruge III
                                                                 Clerk

                          No. 04-30469

     HENRY’S MARINE SERVICE, INC.,

                                         Plaintiff - Appellee,

          versus

     FIREMAN’S FUND INSURANCE COMPANY; ET AL,

                                                         Defendants,

     FIREMAN’S FUND INSURANCE COMPANY,

                                         Defendant - Appellant.
-------------------------------

     FIREMAN’S FUND MCGEE MARINE UNDERWRITERS,

                                                Plaintiff-Appellant,

          versus

     HENRY’S MARINE SERVICE, INC.,

                                                 Defendant-Appellee.
             Appeals from the United States District Court
                 for the Eastern District of Louisiana

Before GARWOOD, SMITH and DeMOSS, Circuit Judges.

GARWOOD, Circuit Judge:*

      Fireman’s Fund Insurance Company (Fireman’s Fund) appeals the

district court’s judgment for Henry’s Marine Service, Inc. (Henry’s

Marine) complaining of the court’s summary judgment on policy

coverage,     its   refusal    to   allow     Fireman’s   Fund   to   amend   its

pleadings, and its refusal to exclude evidence of damages presented

by Henry’s Marine.         We affirm.

                      I.    Facts and Proceedings Below

      Henry’s Marine is a boat brokering/chartering business located

in Morgan City, Louisiana.          From February 12, 2000 to February 12,

2003,     Fireman’s   Fund    insured    Henry’s     Marine   under   a   Hull   &

Machinery policy and a Boat Broker’s policy, both of which were

renewed annually.          During this period, Henry’s Marine was also

insured by New York Marine and General Insurance Company (New York

Marine) under a Marine General Liability policy.1

      The policy’s exclusion            of,    and   extension   for,     assumed
      contractual liability

      *
       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.
      1
       In addition, Henry’s Marine was insured under a Protection and Indemnity
policy and a Pollution Liability policy underwritten by other insurers. Those
policies, however, were not placed at issue in this case.

                                         2
     The principal issue involved in this appeal is the coverage

provided to Henry’s Marine for assumed contractual liability under

Fireman’s Fund’s Boat Broker’s policy.   The “exclusions” clause of

the Boat Broker’s basic policy states that “this insurance does not

apply” to some ten different listed matters, the second of which

(“B”) is “[t]o liability assumed by the Assured [Henry’s Marine]

under any contract or agreement but this exclusion shall not apply

if the Assured would have been liable irrespective of such contract

or agreement.”   On the other hand, the Boat Broker’s policy also

includes as a separate page entitled “contractual liability (hold

harmless/indemnity) extension” the following provision:

     “Underwriters hereon agree to give their permission for
     the Insured [Henry’s Marine] to enter into Time or Voyage
     Charter Agreements whereby the Insured agrees to hold
     harmless and indemnify the Time or Voyage Charterer for
     any and all sums said Time or Voyage Charterer may be
     legally obligated to pay including legal and other
     expenses arising out of the use, management or operation
     of such Time or Voyage chartered vessels by the Insured.
     This insurance is extended to cover the Insured for any
     such sums as the Insured may be legally obligated to pay
     including legal and other expenses as a result of the
     signing of such Time or Voyage Charter Agreements by the
     Insured.

     However, the language of this or any other endorsement to
     this policy shall not be construed to extend the
     Underwriters’ agreement to indemnify the Insured for any
     type of claim not otherwise covered by the Boat Broker’s
     Policy.”

     Tetra Applied Technologies, L.P. (Tetra) is Henry’s Marine’s

largest customer.   Until March 1, 2000, Tetra chartered vessels

from Henry’s Marine under an oral charter agreement.   On March 1,

                                3
2000,     Henry’s    Marine   and   Tetra     formalized    the   oral   charter

agreement by entering into a written Master Time Charter Agreement

(MTCA).     Thereafter, Tetra chartered vessels from Henry’s Marine

under the MTCA.        Under both the oral charter agreement and the

MTCA, Henry’s Marine agreed to defend, indemnify, and hold Tetra

harmless for, among other things, injuries to third parties in

connection with a chartered vessel.

      The Underlying Lawsuits – Francis, Moutinho, and Sellers

      In 1999, Henry’s Marine chartered the M/V Tampa Bay to Tetra

under the oral charter agreement.           Daniel J. Francis, Jr., a seaman

who worked aboard the M/V Tampa Bay, sued Tetra on June 7, 2001,

alleging that he suffered serious physical injuries attempting to

retrieve a tow line in September 1999. Tetra subsequently demanded

that Henry’s Marine defend and indemnify Tetra in this action.2

Henry’s Marine, in turn, notified Fireman’s Fund and requested that

Fireman’s Fund provide coverage under the Contractual Liability

Extension of the Boat Broker’s policy.                Fireman’s Fund denied

coverage for Henry’s Marine in the Francis action against Tetra.

      On January 3, 2001, Henry’s Marine chartered the M/V Diana

McCall to Tetra under the MTCA.         In April 2001, Troy Moutinho, the

captain of     the    M/V   Diana   McCall,    sued   his   employer,    Cameron

      2
       We note that the date of Francis’s alleged injury is prior to February 12,
2000, the beginning date for coverage of Henry’s Marine under the policies issued
by Fireman’s Fund.    On the other hand, Francis’s lawsuit against Tetra and
Tetra’s demand on Henry’s Marine occurred during the coverage period. Fireman’s
Fund’s amended complaint for declaratory judgment states that its Boat Broker’s
policy applies to the Francis action. As the parties have not made an issue of
the date of Francis’s injury, nor shall we.

                                       4
Offshore Boats, Inc. (Cameron), alleging that he suffered serious

physical injuries as he loaded scaffolding boards onto the tug in

January 2001.       In May 2001, Cameron filed a third-party petition

against Tetra, which demanded that Henry’s Marine defend and

indemnify    Tetra    in    accordance   with     the    MTCA.   Henry’s   Marine

notified Fireman’s Fund of Tetra’s demand and requested coverage.

In December 2001, Moutinho amended his petition to join Tetra as a

primary defendant.         On February 27, 2002, Fireman’s Fund, relying

on   the   base    policy’s   contractual    liability      exclusion,     denied

coverage for Henry’s Marine in the Moutinho action against Tetra.

      On July 6, 2001, Wayne Sellers, a seaman who worked aboard the

M/V Diana McCall, sued his employer Cameron alleging that he was

injured in February 2001 during docking operations.                  In December

2001, Cameron filed a third-party petition against Tetra, which

demanded    that    Henry’s    Marine    defend    and    indemnify    Tetra   in

accordance with the MTCA.         In February 2002, Sellers amended his

petition to join Tetra as a primary defendant.                   On February 27,

2002, Fireman’s Fund, relying again on the policy’s exclusion for

contractually assumed liability, denied coverage for Henry’s Marine

in the Sellers action against Tetra.

      The Two Declaratory Judgment Suits

      On September 20, 2002, Fireman’s Fund filed an action in the

United States District Court for the Southern District of Texas

seeking a declaration that no coverage existed under the Boat

                                         5
Broker’s policy for Henry’s Marine’s claims related to the Sellers

action.   On December 13, 2002, Henry’s Marine filed suit against

both Fireman’s Fund and New York Marine in the United States

District Court for the Eastern District of Louisiana seeking a

declaration that coverage existed under both insurers’ policies for

Henry’s Marine’s obligations to defend and indemnify Tetra in all

three of the underlying actions against Tetra. Henry’s Marine also

brought bad faith claims against both insurers under Louisiana law.

Meanwhile, in the Southern District of Texas, Fireman’s Fund was

ordered to amend its complaint to include the Francis and Moutinho

actions in addition to the originally pled Sellers action.3                 On

      3
        In its amended complaint with regard to all three of the underlying
actions, Fireman’s Fund sought a declaration that:

     “a. No coverage exists for Henry’s Marine’s claims for defense and
     indemnity pursuant to the Boat Brokers’ Liability Insurance, because
     the Policy does not provide coverage to defend and indemnify Henry’s
     Marine for any type of claim not otherwise covered by the Boat
     Brokers’ Policy;
     b. No coverage exists for Henry’s Marine’s claim for defense of
     Tetra, in the Seller’s [sic] action, the Francis action or the
     Moutinho action, because the Policy does not provide coverage for
     defense of Tetra. The Policy provides coverage for defense of suits
     against Henry’s Marine . . . ;
     c. No coverage exists for Henry’s Marine’s claim for defense and
     indemnification of Tetra, resulting from an alleged contract or
     agreement between Henry’s Marine and Tetra, because the Policy
     excludes liability assumed by Henry’s Marine under any contract or
     agreement, except if Henry’s Marine would have been liable
     irrespective of such contract or agreement, and there would be no
     liability on behalf of Henry’s Marine, irrespective of the Master
     Time Charter Agreement, for the negligence alleged against Cameron
     and Tetra.
     d. The policy does not provide hull insurance and/or P&I insurance
     on vessels not owned by Henry’s Marine, and specifically scheduled
     in the Policy, as Henry’s Marine has contracted to do. The M/V
     DIANA MCCALL is not owned by Henry’s Marine, or scheduled in the
     Policy. To the extent the vessels at issue in the Francis action
     and the Moutinho action are not owned by Henry’s Marine, those
     vessels are not covered vessels as scheduled in the Policy.”

                                      6
June 27, 2003, Fireman’s Fund’s action was transferred from the

Southern District of Texas to the Eastern District of Louisiana,

where, on July 14, 2003, it was consolidated with the action

brought by Henry’s Marine.          Jurisdiction in these actions was

properly based on diversity of citizenship.            28 U.S.C. § 1332.

     Fireman’s      Fund’s    answer   to    Henry’s   Marine’s    complaint

consisted of a denial of all allegations, plus some inapplicable

boilerplate invoking negligence by Henry’s Marine or third parties,

unavoidable accident, act of God, weather conditions, inscrutable

fault, and/or intervening or superseding events.              In its answer,

Fireman’s Fund also pleaded that it owed no duty and breached no

duty to Henry’s Marine that proximately caused the alleged damages.

Fireman’s Fund’s answer did not plead that Henry’s Marine had

breached any of its warranties under the Boat Broker’s policy.             The

court’s scheduling order required that all amendments to pleadings

be filed by July 21, 2003.       No amended answer was filed.

     Summary Judgment for Henry’s Marine

     Henry’s Marine and Fireman’s Fund both moved for summary

judgment on the question of coverage for the defense and indemnity

claims made by Tetra.        Henry’s Marine’s summary judgment argument

relied upon the “Contractual Liability (hold harmless/indemnity)

Extension” to the Boat Broker’s policy, while Fireman’s Fund’s

argument   relied    primarily     upon     that   policy’s   exclusion    for

contractually assumed liability.            In addition to the exclusion,

                                       7
Fireman’s Fund also argued the policy did not cover these claims

because the vessels in question were not scheduled under the base

policy’s Loss Payable Clause and also because the base policy’s

Privilege to Charter Clause prevented any party from being “deemed

an Additional Assured . . . unless that party is actually engaged

or involved in the operations at the time of the loss, if any.”

The district court rejected Fireman’s Fund’s arguments related to

the Loss Payable Clause and the Privilege to Charter Clause and

found that the Boat Broker’s policy’s exclusion for contractually

assumed    liability   was    in   direct    conflict    with     the       policy’s

“contractual liability (hold harmless/indemnity) extension.”                      In

addition, the district court found that the language of the second

paragraph of the policy’s said extension was ambiguous and subject

to more than one reasonable interpretation, and therefore must be

construed against Fireman’s Fund and in favor of coverage.                       The

court   noted   that   Fireman’s     Fund     had   offered      no     reasonable

explanation of what the extension covers and that Fireman’s Fund’s

interpretation would lead to the absurd result of rendering the

extension redundant and meaningless.            On October 22, 2003, the

district    court   granted    Henry’s      Marine’s    motion        for    summary

judgment, declaring that coverage existed for the defense and

indemnity claims made by Tetra against Henry’s Marine under the

Boat Broker’s policy issued by Fireman’s Fund.

                                      8
     Fireman’s Fund’s Rule            59       motion    and    other       post-summary
     judgment proceedings

     On October 27, 2003, Fireman’s Fund filed a Rule 59 motion for

a new trial or, in the alternative, reconsideration.                               In this

motion, Fireman’s Fund not only repeated its argument that the

Exclusion   precludes       coverage       for     any    contractually            assumed

liability, but also argued that, assuming the policy language was

ambiguous, the district court should have applied the reasonable

expectations doctrine, under which “[t]he court should construe the

policy ‘to fulfill the reasonable expectations of the parties in

the light of the customs and usages of the industry.’”                         Louisiana

Ins. Guar. Ass'n v. Interstate Fire & Cas. Co., 630 So.2d 759, 764

(La. 1994) (quoting Trinity Industries, Inc. v. Ins. Co. of North

America, 916 F.2d 267, 269 (5th Cir. 1990)).                   In its motion for a

new trial, Fireman’s Fund argued that the policy interpretation

adopted by the district court could not have been the intent of the

parties because it results in Fireman’s Fund, for a premium of only

$3,500, becoming the primary liability insurer for any company that

charters a vessel from Henry’s Marine — an “unreasonable position”

considering that Fireman’s Fund charged a premium of $82,069 to

Henry’s Marine      for    Hull   &   Machinery         coverage      for    only    three

scheduled vessels.        In the motion for a new trial, Fireman’s Fund

also offered   an    explanation       and       examples      of    what    the    policy

Extension does cover under its interpretation.                      The final argument

offered by Fireman’s Fund in its motion for a new trial was that

                                           9
Henry’s   Marine    did   not   show   that    it   had   complied    with   its

obligations under paragraph 13 of the Boat Broker’s policy to

obtain $1,000,000 in Protection & Indemnity coverage naming Henry’s

Marine as an additional assured.4

      On December 15, 2003, the district court denied Fireman’s

Fund’s motion for new trial or reconsideration.               With respect to

Fireman’s Fund’s argument that Henry’s Marine had not shown its

compliance with certain terms in the policy, the court noted that

Fireman’s Fund had “ample opportunity to assert these provisions”

in earlier filings.          The district court also noted that, in

Louisiana, an insurer-defendant relying on the breach of a material

warranty must plead specially this defense and then carry the

burden to prove it by a preponderance of the evidence.5              The court

found that Fireman’s Fund had not met its burden.

      4
       Paragraph 13 of the Boat Broker’s policy provides:

      “IT IS A WARRANTY OF THIS POLICY THAT:
      All vessels chartered must have Hull Insurance to value and a
      minimum of US $1,000,000.00 or Hull Value whichever is the greater,
      Protection and Indemnity including Collision and Towers Liability of
      US $1,000,000.00 or to Hull Value whichever the greater.        This
      insurance to be carried at Owners [sic] expense. Said policy must
      name INSURED as an Additional Assured and waive rights of
      subrogation against INSURED[.] Certificate of Insurance to be
      obtained/on file with Gulf Coast Marine, Inc.”
      5
       In this the district court relied on Rodriguez v. Northwestern Nat. Ins.
Co., 358 So.2d 1237, 1241 (La. 1978) (“Breach of warranty is a special defense
which the insurer has the burden of proving by at least a preponderance of
evidence.”); Lee v. Travelers Fire Ins. Co., 53 So.2d 692, 695 (La. 1951) (“‘The
Supreme Court has stated . . . that, where an insurance company seeks to avoid
liability because of the breach of a material warranty contained in the policy,
the defense must be pleaded specially and that the insurer has the burden of
proving by a preponderance of evidence that the breach did increase the moral
hazard of the risk.’” (quoting Rickerfor v. Westchester Fire Ins. Co. of New
York, 186 So. 109, 112 (La.App. 1939)); and Benjamin v. Connecticut Indem. Ass'n,
11 So. 628, 629 (La. 1892).

                                       10
     Fireman’s Fund thereafter moved for leave to file a second

amended complaint and first amended answer to assert the “warranty”

provision of the Boat Broker’s policy.        After these motions were

denied by the magistrate judge on January 8, 2004, Fireman’s Fund

moved for a review of the magistrate judge’s ruling.          On February

5, 2004, the district court affirmed the magistrate judge’s denial

of leave to amend, finding that Fireman’s Fund had not shown “good

cause” as required by Rule 16(b), which “governs amendment of

pleadings after a scheduling order deadline has expired.” S&W

Enterprises, L.L.C. v. SouthTrust Bank of Alabama, 315 F.3d 533,

536 (5th Cir. 2003).

     On January 30, 2004, Fireman’s Fund moved to exclude Henry’s

Marine’s evidence of damages pursuant to Federal Rules of Civil

Procedure 26 and 37.     On February 10, 2004, the district court

denied this motion, finding no abuse of the discovery process by

Henry’s Marine.      On February 9 – 10, 2004, the district court

conducted a bench trial on the amount of damages and on the

question of bad faith denial of claims.         On April 8, 2004, the

court ruled   that   Henry’s   Marine   was   entitled   to   defense   and

indemnity costs from Fireman’s Fund of $425,972.00 plus additional

attorneys’ fees through trial. The court also ruled that Fireman’s

Fund and New York Marine had not denied Henry’s Marine’s claims in

bad faith in violation of La. Rev. Stat. § 22:1220(B)(1).          On May

17, 2004, the district court vacated its award to Henry’s Marine

                                  11
for the attorneys’ fees incurred in litigating this matter, and, on

June 2, 2004, the district court entered judgment in favor of

Henry’s Marine for $378,371.92 plus interest from that date as well

as for costs in the additional amount of $4,883.53.            Fireman’s Fund

appeals.

                            II.     Discussion

     On appeal, Fireman’s Fund raises five points of error. First,

Fireman’s Fund asserts that Henry’s Marine failed to satisfy all

conditions precedent, including policy warranties, to prove that it

is entitled to coverage under the policy.            Second, Fireman’s Fund

argues that   the    district    court    abused    its   discretion    by   not

allowing Fireman’s Fund to amend its pleadings.             Third, Fireman’s

Fund claims error by the district court in finding coverage under

the Boat Broker’s policy.        Fourth, Fireman’s Fund claims error by

the district court in failing to exclude Henry’s Marine’s evidence

of damages under Federal Rule of Civil Procedure 37(c)(1).               Fifth,

Fireman’s Fund argues that Henry’s Marine failed to prove that its

alleged loss was covered by the Boat Broker’s policy.

A.   Whether Henry’s Marine satisfied all conditions precedent to
     prove that it is entitled to coverage under the Boat
     Broker’s policy

     Fireman’s Fund argues that the district court erred as a

matter of law in finding coverage for Henry’s Marine’s claims in

spite of the fact that Henry’s Marine did not prove that it had

satisfied   all     conditions    precedent,       including   the     explicit

                                     12
warranties, under the Boat Broker’s policy.              The district court

found that the substantive law of Louisiana governs this dispute.6

As the district court noted, the Supreme Court of Louisiana has

said that an insurer has the burden to prove, by at least a

preponderance of the evidence, that the insured breached a warranty

in the insurance policy.       Rodriguez v. Northwestern Nat. Ins. Co.,

358 So.2d 1237, 1241 (La. 1978).                The policy provision that

Fireman’s Fund now relies upon is an explicit warranty.                In fact,

it begins with the words, “It is a warranty of this policy that .

. . .”    Supra note 4.      Therefore, Rodriguez places the burden on

Fireman’s    Fund    to   prove   that      Henry’s   Marine   breached     this

warranty.7    Because Fireman’s Fund presented no evidence to show a

      6
        Both Fireman’s Fund and Henry’s Marine cite to Louisiana cases in support
of the arguments in their appellate briefs. At oral argument, however, Fireman’s
Fund appeared to contest the application of Louisiana law, pointing instead to
maritime law.    In its brief, on the other hand, Fireman’s Fund argued that
“Louisiana law does not conflict with maritime law” on this issue. Because
neither party appealed the district court’s decision that Louisiana law governs
this dispute, we will rely on Louisiana law.
      7
       In its brief and at oral argument, Fireman’s Fund relied on the Second
Circuit’s opinion in Commercial Union Ins. Co. v. Flagship Marine Services, Inc.,
190 F.3d 26 (2d Cir. 1999). In Commercial Union, the Second Circuit noted,
“Under the federal rule and the law of most states, warranties in maritime
insurance contracts must be strictly complied with, even if they are collateral
to the primary risk that is the subject of the contract, if the insured is to
recover.” Id. at 31. Fireman’s Fund makes much of the Second Circuit’s strict-
compliance language. Although we do not disagree with the Second Circuit’s
statement of the general rule requiring strict compliance, the Commercial Union
opinion does not discuss the appropriate burden of proof and, therefore, it does
not help Fireman’s Fund on this issue.       Moreover, the insurer-defendant in
Commercial Union raised the warranty defense when it initially denied coverage
and again in the litigation at the trial court. For this reason, Commercial
Union stands in stark contrast to this case, where Fireman’s Fund did not deny
coverage based on a warranty defense and did not raise the warranty defense until
after losing the coverage issue on summary judgment.

                                       13
breach, we agree with the district court that Fireman’s Fund did

not meet its burden.

     Presumably to avoid Rodriguez, Fireman’s Fund nonetheless

argues that “[t]he jurisprudential treatment of insurance law

provides that the terms ‘warranty’ and ‘condition precedent’ are

often used interchangeably,” and that “[i]t has been widely held in

American jurisprudence that the burden to prove compliance with a

condition precedent of an insurance policy is on the insured.”

Fireman’s Fund supports this statement by citing to state cases

from Iowa, Connecticut, Virginia, and Nebraska and to federal

district court cases from New York, Vermont, Delaware and Illinois.

Fireman’s Fund also points to a 1937 Louisiana intermediate court

opinion that quoted a treatise the stated, “‘A warranty is in the

nature of a condition precedent . . . .’”       City Bank & Trust Co. v.

Commercial Casualty Co., 176 So. 27, 30 (La. App. 2d Cir. 1937)

(quoting 14 Ruling Case Law, p. 1026, § 206).               Even assuming

arguendo that we were willing to treat the warranty at issue in

this case as a condition precedent and place the ultimate burden of

proof of compliance on Henry’s Marine, Fireman’s Fund’s argument

still   fails   because   it   did   not   timely   make   the   “condition

precedent” an issue in the coverage dispute.         In every case cited

by Fireman’s Fund to support its argument that the burden to prove

compliance with a condition precedent is on the insured, the

insurer had timely raised the insured’s lack of compliance as a

                                     14
defense to coverage in the trial court.    In this case, however,

Fireman’s Fund raised the alleged lack of compliance by Henry’s

Marine only after it lost the coverage issue on cross-motions for

summary judgment.

B.   Whether the district court erred by not allowing Fireman’s
     Fund to amend its pleadings

     After the district court granted summary judgment for Henry’s

Marine on the issue of coverage and denied Fireman’s Fund’s motion

for new trial/reconsideration, Fireman’s Fund moved for leave to

amend its pleadings to assert the warranty as a defense.      The

motion for leave to amend was denied by the district court.     A

district court’s denial of leave to amend is reviewed for an abuse

of discretion.   Martin's Herend Imports v. Diamond & Gem Trading,

195 F.3d 765, 770 (5th Cir. 1999).

     Fireman’s Fund argues that the district court abused its

discretion because Federal Rule of Civil Procedure 15(a) requires

the trial court to freely grant leave to amend.       Rule 15(a),

however, is not the correct rule to apply in this situation.

Instead, because Fireman’s Fund’s motion for leave to amend was

filed almost five months after the deadline for amendments set by

the scheduling order, Rule 16(b) applied, requiring Fireman’s Fund

to show “good cause.”   See S&W Enterprises, L.L.C. v. SouthTrust

Bank of Alabama, 315 F.3d 533, 536 (5th Cir. 2003).   The district

court noted Fireman’s Fund admission that the reason it did not

plead the warranty defense earlier was that it thought it would

                                15
prevail on its other argument.       We agree with the district court’s

observation that “[t]his is not good cause for not having timely

asserted all of its possible defenses in its declaratory complaint

or in its answer to plaintiff’s declaratory complaint.”

      Moreover, even under the more lenient standard of Rule 15(a),

the   district   court   did   not   abuse   its   discretion   by   denying

Fireman’s Fund leave to amend.         “A busy district court need not

allow itself to be imposed upon by the presentation of theories

seriatim.”    Freeman v. Continental Gin Co., 381 F.2d 459, 469 (5th

Cir. 1967). “Further, after summary judgment has been granted, the

court has ‘even more reason for refusing to allow amendment.’”

Union Planters Nat. Leasing v. Woods, 687 F.2d 117, 121 (5th Cir.

1982) (quoting Freeman, 381 F.2d at 469).          In Freeman, we held that

“a district court does not abuse its discretion in refusing to

allow amendment of pleadings to change the theory of a case if the

amendment is offered after summary judgment . . . and no valid

reason is shown for failure to present the new theory at an earlier

time.”      Id. at 470. “We have consistently followed Freeman.”

Briddle v. Scott, 63 F.3d 364, 380 (5th Cir. 1995); see also

Wentwood Woodside I, LP v. GMAC Commercial Mortg., 419 F.3d 310,

318 (5th Cir. 2005).     The district court noted that Fireman’s Fund

had agreed that the issue of coverage was ready for summary

judgment.    In addition, the district court noted that Fireman’s

Fund had failed to raise the warranty defense at least four times

                                     16
prior to summary judgment.8         We hold that the district court did

not abuse its discretion in denying Fireman’s Fund’s motion for

leave to amend its pleadings.

C.    Whether the district court erred by granting summary judgment
      to Henry’s Marine on the issue of coverage

      Fireman’s Fund also claims error by the district court in

granting summary judgment for Henry’s Marine on the issue of

coverage in spite of the policy’s exclusion for contractually

assumed liability. We review the district court’s grant of summary

judgment and its interpretation of the insurance policy de novo,

applying the same standards as the district court.            American Guar.

and Liability Ins. Co. v. 1906 Co., 129 F.3d 802, 805 (5th Cir.

1997).

      Fireman’s Fund based its motion for summary judgment on three

legal arguments.       First, Fireman’s Fund argued to the district

court that coverage was precluded because the vessels involved in

the underlying lawsuits, although they had been chartered from

Henry’s Marine by Tetra, were not listed in Henry’s Marine’s policy

and, therefore, coverage did not extend to these vessels.                   The

district court determined that the policy’s Schedule of Vessels and

Loss Payable Clause was applicable only to the Hull & Machinery,

      8
        The four opportunities noted by the district court: (1) Fireman’s Fund’s
complaint for declaratory relief (which was also amended once); (2) Fireman’s
Fund’s answer to Henry’s complaint for declaratory relief; (3) Fireman’s Fund’s
motion for summary judgment in the consolidated cases; and (4) Fireman’s Fund’s
response to Henry’s Marine’s motion for summary judgment.

                                      17
Protection & Indemnity, and the Pollution Liability sections of the

policy, not to the Boat Broker’s section of the policy.   Fireman’s

Fund does not appeal the district court’s determination on this

issue.   Second, Fireman’s Fund argued to the district court that

Henry’s Marine’s claims for coverage failed because the policy’s

Privilege to Charter Clause states that “no party shall be deemed

an Additional Assured or favored with a waiver of subrogation of

any vessel(s) insured hereunder, unless that party is actually

engaged or involved in the operations at the time of the loss, if

any.”    The district court determined that this clause was not

applicable because Henry’s Marine was not asserting that Tetra was

an additional assured.   Fireman’s Fund also does not appeal this

determination.

     Fireman’s Fund’s final argument to the district court in its

motion for summary judgment was that the Boat Broker’s policy

explicitly excluded coverage for “liability assumed by Henry’s

Marine under any contract or agreement unless Henry’s Marine would

be liable irrespective of the agreement.”     Therefore, Fireman’s

Fund urged the district court to find coverage precluded as a

matter of law because Henry’s Marine was neither the owner nor the

operator of the vessels in question and so “Henry’s Marine could

not be found liable irrespective of any agreement.”   The district

court determined that the language of the exclusion was in direct

conflict with the first paragraph of the contractual liability

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(hold harmless/indemnity) extension, which granted permission for

Henry’s Marine to enter into charter agreements under which Henry’s

Marine would agree to hold harmless and indemnify a charterer “for

any and all sums said . . . Charterer may be legally obligated to

pay including legal and other expenses arising out of the use,

management or operation of such . . . chartered vessels by the

Insured.”     Fireman’s Fund argued to the district court that,

pursuant to the Extension’s second paragraph, it does not extend

coverage to types of claims not otherwise covered by the Boat

Broker’s policy.       The district court noted that Fireman’s Fund’s

“interpretation would lead to absurd results” because it “would

render the Extension redundant and meaningless.”                    After observing

that Fireman’s Fund had offered no reasonable explanation of what

the Extension covers, the district court noted that “a reasonable

interpretation of the second paragraph of the Extension is that

coverage is provided for contractual liability, unless it runs

afoul of some bar other than the contractual liability exclusion in

the body of the policy.”

     After    summary       judgment    was     granted   to       Henry’s    Marine,

Fireman’s Fund offered a different interpretation of the policy.

In   Fireman’s      Fund’s    Rule     59     motion   for     a    new    trial   or

reconsideration, it argued for the first time that the policy does

provide     coverage    for     Henry’s       Marine’s    assumed         contractual

liability,    but    only    for   liability     based    on   Henry’s       Marine’s

                                        19
agreement   to   indemnify   the   charterer    for   Henry’s   Marine’s

negligence or fault as a boat broker.       Fireman’s Fund repeats this

new argument on appeal, but we do not consider it because it was

not raised below.   “These [Rule 59] motions cannot be used to raise

arguments which could, and should, have been made before the

judgment issued.    Moreover, they cannot be used to argue a case

under a new legal theory.”   Simon v. U.S., 891 F.2d 1154, 1159 (5th

Cir. 1990) (quotations omitted).        Considering the construction of

the policy urged in support of the summary judgment, we hold that

the district court did not err in determining that the “contractual

liability (hold harmless/indemnity) extension” would be rendered

meaningless by Fireman’s Fund’s pre-summary judgment interpretation

of it and the base policy exclusion.           In any event, Fireman’s

Fund’s new argument is unpersuasive as it does not provide any

example of coverage which would have been excluded by the base

policy exclusion for contractually assumed liability but was added

by “contractual liability (hold harmless/indemnity) extension.”

The examples suggested by Fireman’s Fund are all ones that it

characterizes as being instances in which “Henry’s Marine could

have independent liability” – i.e., liability irrespective of the

contractual assumption of liability – “to any beneficiary of the

chartered party.”   But such examples would be ones not within the

base policy exclusion (which excepts instances where the insured

“would have been liable irrespective” of the contractual assumption

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of liability) and hence do not suffice to give independent meaning

to the “contractual liability (hold harmless/indemnity) extension.”

The district court did not err in granting summary judgment on the

issue of coverage to Henry’s Marine.

D.   Whether the district court erred by refusing to exclude
     Henry’s Marine’s evidence of damages pursuant to Rule 37(c)

     Fireman’s Fund contends that the district court erred in

refusing to exclude Henry’s Marine’s evidence of damages pursuant

to Federal Rule of Civil Procedure 37.             We review for an abuse of

discretion the district court’s decision not to exclude evidence

under Rule 37.   Primrose Operating Co. v. National American Ins.,

382 F.3d 546, 563 (5th Cir. 2004); Texas A&M Research Foundation v.

Magna Transp., 338 F.3d 394, 402 (5th Cir. 2003).

     Fireman’s   Fund    claims     that    Henry’s       Marine      violated   the

disclosure requirements of Rule 26(a)(1)(C) by not providing a

computation of damages in its initial disclosure. Rule 26 requires

that a party disclose “information then reasonably available to

it.” FED. R. CIV. P. 26(a)(1). The district court noted that Henry’s

Marine stated    that   its    damages     consisted      of    the    defense   and

indemnity   expenses    owed   to   Tetra    and    the    legal      expenses   for

pursuing coverage from its insurers.                At the time of initial

discovery, the coverage dispute was ongoing as were two of the

three underlying lawsuits against Tetra, and so Henry’s Marine

could not provide an exact amount of damages.                  We agree with the

district court that Henry’s Marine’s “response was not perfect but

                                     21
it was not a failure to disclose.”          Fireman’s Fund also argues that

Henry’s Marine violated Rule 26(a)(1)(C) by             failing to provide it

with any of the documents or evidentiary material to support its

claim for damages until less than three weeks before the trial.

Rule 26(a)(1)(C) requires only that the party make this evidence

available for inspection and copying as under Rule 34.               There is

nothing to indicate that Henry’s Marine did not make this evidence

available to Fireman’s Fund.     On the contrary, the district court

noted that Fireman’s Fund never attempted to inspect or copy

Henry’s Marine’s damages documents. After reviewing the discovery-

related conduct by both parties, the district court determined that

exclusion of Henry’s Marine’s damages evidence under Rule 37 was

not   warranted.     We   find   no        abuse   of   discretion   in   this

determination.

E.    Whether the district court erred in finding that Tetra Applied
      Technologies, L.P. is the successor to Tetra Applied
      Technologies, Inc.

      Fireman’s Fund contends that the district court erred in

finding coverage for Tetra’s claims against Henry’s Marine because

the demands were made by Tetra Applied Technologies, L.P. (Tetra

L.P.) but the Master Time Charter Agreement obligated Henry’s

Marine to defend and indemnify Tetra Applied Technologies, Inc.

(Tetra Inc.).    Fireman’s Fund also argues that Henry’s Marine paid

Tetra L.P.’s claims pursuant to an Asset Purchase Agreement, not

                                      22
the Master Time Charter Agreement contemplated by the Boat Broker’s

policy.       These arguments are without merit.

       As the district court noted, Tetra merely changed its name

from Tetra Inc. to Tetra L.P.                 The district court identified

specific evidence in the record that shows that Tetra Inc. and

Tetra L.P. were the same business enterprise.9                 Moreover, as the

district court also noted, the Master Time Charter Agreement

between Henry’s Marine and Tetra Inc. provided that Henry’s Marine

agreed to indemnify parents, subsidiaries and affiliates of Tetra

Inc.        The district court’s determination that Tetra L.P. is the

successor to Tetra Inc., or at least its affiliate, is not clearly

erroneous, and nothing in the record suggests otherwise.

       The     district   court   also   found    that   the    Asset   Purchase

Agreement between Henry’s Marine and Tetra L.P. merely acknowledged

Henry’s Marine’s existing obligation under the Master Time Charter

Agreement to defend and indemnify Tetra.10               There is no basis to

disturb the district court’s determination that the payments made

by Henry’s Marine to Tetra L.P. were made pursuant to the Master

       9
       One example the district court mentioned is Tetra’s pleading in the
underlying Francis lawsuit. Although Tetra originally answered as Tetra, Inc.,
its first supplemental petition began with the following: “NOW INTO COURT,
through undersigned counsel, comes Tetra Applied Technologies, L.P., formerly
Tetra Applied Technologies, Inc. . . .”
       10
       Supporting this finding is the explicit language of the Asset Purchase
Agreement, which provides, “Pursuant to Article 11 of that certain Master Time
Charter dated March 1, 2000 (the “Time Charter”) by and between the Parties,
Henry’s is required to indemnify TETRA Applied . . . .” (emphasis added).

                                         23
Time Charter Agreement that was contemplated in — and covered by —

Henry’s Marine’s Boat Broker’s policy with Fireman’s Fund.

                           Conclusion

     For the foregoing reasons, the judgment of the district court

is

                           AFFIRMED.

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