Supreme Court Rules for Insurance Companies in Suit Filed by Flood-Ravaged Xavier University

Xavier University, the historically black college in New Orleans, experienced severe flooding in the aftermath of Hurricane Katrina in August 2005. Every building on campus had at least four feet of water. Total damage estimates were as high as $100 million.

Insurance companies were willing to pay for only a small fraction of the damage. The university’s policy covered only damage from wind. The university filed a federal lawsuit claiming that the flooding was caused by a defective man-made levee system and not directly by the storm. Therefore, according to the university, the insurer should pay for more, if not all the damages.

A local federal court ruled for the university in 2006. But that decision was unanimously overturned by the Fifth Circuit Court of Appeals. Late last month the U.S. Supreme Court refused to hear an appeal of the case. Thus, Xavier University will not receive any additional payout from its insurers.