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Pan Am Equities, Inc. v. Lexington Insurance Company No. 19-20363

http://www.ca5.uscourts.gov/opinions/pub/19/19-20363-CV0.pdf

Before WIENER, STEWART, and WILLETT, Circuit Judges.

AFFIRMED. (May 26, 2020).

Hurricane Harvey was the second-costliest natural disaster in U.S. history, ranking just behind Hurricane Katrina. This insurance-coverage case—a debate over deductibles—concerns Harvey-induced flood damage to two office buildings owned by Pan Am Equities and insured by Lexington Insurance. The Policy contained two competing deductibles: (1) the generic “Flood” deductible (favored by Pan Am), which covered “any . . . loss due to Flood”; and (2) the pricier “Windstorm” deductible (favored by Lexington), which covered “Flood” damage “arising out of a Named Storm.” Important here, the Policy also has an Anti-Stacking clause that said if multiple deductibles were to apply, then the largest one trumps. The District Court sided with Lexington that the unequivocal language of the “Windstorm” deductible controlled, meaning zero recovery for Pan Am. The Fifth Circuit agrees. The Court reasons that the Policy yields one unambiguous interpretation, and the applicable deductible is not debatable. The Court therefore affirms the District Court’s grant of summary judgment to Lexington.

On Appeal from the United States District Court for the Southern District of Texas (Nancy F. Atlas).
Attorney for Appellant – Stephen Adam Weisbrod, Washington, DC
Attorney for Appellee – James Michael Dennis, New York, NY

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