Court Opinion

ID: 4014797
Source: CourtListenerOpinion
Date Created: 2016-07-12 00:00:55.136137+00
Date Added: 2024-06-11T07:44:53.413498
License: Public Domain

Case: 13-20433      Document: 00513586145         Page: 1    Date Filed: 07/11/2016

            IN THE UNITED STATES COURT OF APPEALS
                     FOR THE FIFTH CIRCUIT
                                                                           United States Court of Appeals
                                                                                    Fifth Circuit
                                      No. 13-20433                                FILED
                                                                              July 11, 2016
                                                                             Lyle W. Cayce
U.S. METALS, INCORPORATED,                                                        Clerk

              Plaintiff - Appellant

v.

LIBERTY MUTUAL GROUP, INCORPORATED, doing business as Liberty
Insurance Corporation,

              Defendant - Appellee

                   Appeal from the United States District Court
                        for the Southern District of Texas
                              USDC No. 4:12-CV-379

Before STEWART, Chief Judge, OWEN, Circuit Judge, and MORGAN∗,
District Judge.
PER CURIAM:**
       This appeal arises from a dispute between U.S. Metals, Inc., (“U.S.
Metals”) and Liberty Mutual Group, Inc., (“Liberty”) regarding coverage of
certain damages pursuant to two exclusions in a commercial general liability
insurance policy (the “CGL Policy” or “Policy”). The district court granted

       ∗
         District Judge of the Eastern District of Louisiana, sitting by designation.
       **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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH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.
    Case: 13-20433     Document: 00513586145     Page: 2   Date Filed: 07/11/2016

                                  No. 13-20433
summary judgment for Liberty on U.S. Metals’s indemnity claim, in part, on
the ground that Exclusion M in the Policy precludes coverage for “damage that
occur[ed] during the replacement process to property other than [the flanges]—
in this case, the temperature coating, the gaskets, the piping, and the
insulation.” In a prior opinion, we certified four questions to the Supreme
Court of Texas regarding the proper interpretation of the Policy. See U.S.
Metals, Inc. v. Liberty Mut. Grp., Inc., 589 F. App’x 659, 663–64 (5th Cir. 2014).
In answering our certified questions, the Supreme Court of Texas stated:
      [t]he diesel units were restored to use by replacing the flanges and
      were therefore impaired property to which Exclusion M applies.
      Thus, their loss of use is not covered by the policy. But the
      insulation and gaskets destroyed in the process were not restored
      to use; they were replaced. They were therefore not impaired
      property to which Exclusion M applied, and the cost of replacing
      them was therefore covered by the policy.
U.S. Metals, Inc. v. Liberty Mut. Grp., Inc., No. 14-0753, 2015 WL 7792557, at
*7 (Tex. Dec. 4, 2015), reh’g denied (June 17, 2016). The district court therefore
erred in its holding regarding its interpretation of Exclusion M in the CGL
Policy. Because the district court’s holdings regarding all of U.S. Metals’s
claims relate to the interpretation of the Policy’s coverage and exclusions, we
REVERSE and REMAND for further proceedings consistent with the Supreme
Court of Texas’s opinion.

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