KAAPA Ethanol, LLC v. Affiliated FM Insurance

LOKEN, Circuit Judge.

KAAPA Ethanol (“KAAPA”) manages a facility in Kearney County, Nebraska that distills corn into ethanol, a biofuel additive for gasoline. The plant was insured against property damage by an “all-risk” insurance policy issued by Affiliated FM Insurance Company (“Affiliated”). Soon after KAAPA began production, the plant’s ethanol production and storage tanks began to lean, their foundations began showing visible signs of distress, and their supporting concrete walls sunk into the ground. KAAPA commenced this diversity action after Affiliated denied KAA-PA’s claim to recover…