Maxus Metropolitan, LLC v. Travelers Property Casualty Company of America

United States Court of Appeals
For the Eighth Circuit
___________________________
No. 24-1176
___________________________
Maxus Metropolitan, LLC
Plaintiff - Appellee
v.
Travelers Property Casualty Company of America
Defendant - Appellant
____________
Appeal from United States District Court
for the Western District of Missouri - Kansas City
____________
Submitted: November 12, 2025
Filed: November 17, 2025
____________
Before COLLOTON, Chief Judge, ARNOLD and GRUENDER, Circuit Judges.
____________
GRUENDER, Circuit Judge.
On September 27, 2018, a catastrophic fire struck the Metropolitan, a multi-
building apartment complex located in Birmingham, Alabama. It destroyed one of
the Metropolitan’s buildings entirely and caused varying degrees of damage to the
others. The insurance carrier at the time of the fire, Travelers Property Casualty
Company of America (“Travelers”), denied payment to the Metropolitan’s owner,
Maxus Metropolitan, LLC (“Maxus”), for certain related remediation costs. Maxus

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sued Travelers for breach of contract and vexatious refusal to pay. At trial, the jury
sided with Maxus and awarded it damages of $27,330,263.13. It also found
Travelers liable for vexatious refusal to pay and accordingly awarded Maxus
additional damages of $546,905, plus attorneys’ fees as allowed under Missouri law.
Travelers appeals the district court’s denial of its motions for judgment as a matter
of law and for a new trial as well its grant of prejudgment interest and attorneys’
fees. We affirm on all issues except regarding the grant of prejudgment interest,
which we vacate and remand for recalculation.
I. Background
On September 27, 2018, a fire destroyed “Phase 6,” a standalone building that
was part of the Metropolitan. The Metropolitan consisted of several buildings and
was divided into six distinct “phases.” At the time of the fire, all six phases of the
Metropolitan were at various stages of completion, including some which were
occupied by tenants. Phase 6 was still under construction. Phase 6 was connected
to Phase 5 via an open-air walkway. No other direct connection existed between
Phase 6 and the other phases. The fire caused severe and obvious damage to Phase
5, including broken windows, melted window frames, damaged siding, and
extensive soot1 throughout. Embers burned holes in the roofs of Phases 1-5. The
interiors of Phases 1-4, however, appeared to have been unaffected by the fire.
At the time of the fire, the Metropolitan’s policy with Travelers covered up to
$35 million in “direct physical loss . . . or damage.”2 The policy also provided
1 The parties refer to different types of combustion byproducts, e.g., soot, ash,
char. The technical distinctions between these byproducts do not affect our analysis.
For simplicity, we use the term “soot” to refer to all combustion byproducts.
2 Maxus owned the Metropolitan at the time of the fire, having recently
purchased it from Bomasada Birmingham, LLC, which continued to serve as the
general contractor on the project and maintained its preexisting insurance policy
with Travelers. Due to the change in ownership, Maxus qualified as an additional
named insured on the policy. Bomasada is not a party here.

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coverage for up to $5 million in lost business income. The policy expired just three
days after the fire on September 30, 2018 and was not renewed.
Almost from the start, Maxus and Travelers experienced difficulties in their
dealings with each other. Maxus notified Travelers of the fire the very day it
occurred, but Travelers did not reach a coverage determination until almost two
months later. When a month and a half had passed with no decision, Maxus filed a
consumer complaint with the Alabama Department of Insurance. Nine days later—
and sixty-three days after the fire—Travelers notified Maxus that it would provide
coverage. (Travelers asserts this delay was caused by confusion as to whether a
centralized intruder alarm system—which the Metropolitan lacked—was actually
required, given that the policy and renewal letter had different terms in that regard.)
Four days later, on December 3, representatives from Travelers and Maxus met in
person. Travelers agreed to advance $1,000,000 for initial cleanup and emergency
repair costs. It also reiterated its previous request for documentation regarding the
level of completion of Phase 6 at the time of the fire. The parties also agreed that an
environmental testing company would test Phases 5 and 6 for contaminants. Testing
was carried out in mid-December. On March 13, 2019—after receiving the
inspection report from January 15 and after several additional months of back-and-
forth regarding required documentation—Travelers made an additional payment,
bringing its total payout to $3,519,607.19.
Up to this point, neither party was concerned about possible fire damage in
Phases 1-4. Then, in April 2019, Maxus’s vice president of construction visited the
site and discovered evidence of soot and water damage throughout Phases 1-5.
Accordingly, Maxus hired Forensic Building Science (“FBS”) to inspect Phases 1-5
for fire damage. Upon inspection, FBS identified visible soot stains throughout
Phases 1-5 that seemed to indicate smoke had entered the Metropolitan’s HVAC
system during the fire. FBS gathered and sent seventy-two samples to the lab, which
confirmed that all but one or two contained soot to varying degrees—from “trace”
to “significant.” FBS recommended pausing construction to allow it to return to the
exact same locations in two weeks for further testing. FBS also found a large amount

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of water damage, some of which it believed to have been caused by preexisting
construction defects and some of which it believed to have resulted from leaks from
the holes in the roof created by burning embers. Maxus informed Travelers of FBS’s
initial findings.
FBS issued its official report on June 5, 2019, finding that carcinogenic soot
was present throughout Phases 1-5 and that extensive remediation was required,
which would necessitate the evacuation of all residents and employees. Maxus
immediately forwarded the report to Travelers, requesting its input as to the planned
remediation. Travelers did not respond. On June 11, Maxus reached out again,
requesting a response before Maxus evacuated tenants. Travelers responded the next
day, explaining that it had arranged for an industrial hygienist to investigate the
property and that until Travelers received that report, it could not say whether the
evacuation of residents was covered under the policy. Further, Travelers noted that
the hygienist’s report would only provide information as to whether the evacuation
costs were covered under the policy. Travelers refused to take a position on whether
an evacuation was needed and explained that it “has not undertaken and will not
undertake any technical, feasibility, safety, or other review of the report or opinions
of” FBS.
The hygienist visually inspected the Metropolitan on June 13, 2019. He
detected no odor or stains that indicated smoke infiltration. On August 2, he sent his
report to Travelers and advised them against performing any additional testing.
Travelers did not discuss this report with Maxus but requested that the hygienist
return to perform additional testing, which he did on September 30 and October 1.
Meanwhile, concerned by the FBS report, the Metropolitan had already evacuated
its tenants, notifying them on June 14 that they were required to vacate by June 24.
In mid-September, before the hygienist returned, Maxus informed Travelers
that it intended to begin remediation of Phases 1-4 on October 7 and asked whether
Travelers objected to this remediation. Travelers responded that it could not take a
position until after the hygienist had completed his testing. On October 9—after the

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hygienist had performed additional tests but before the parties had received the
results—Maxus signed a contract with a construction company to begin remediation.
Remediation on each floor required installing a temporary plastic containment to
eliminate cross-contamination between floors; removing and disposing of sheetrock,
carpets, and other items that could not be cleaned; temporarily removing and
cleaning cabinets, countertops, appliances, trim, doors, and windows; cleaning
interior wall cavities using HEPA filtration; spraying structural components with
multiple coats of sealant; conducting clearance testing to confirm the absence of
soot; and rebuilding.
On December 16, Travelers sent Maxus the hygienist’s reports—both the
report based on his June 13 visual observations and the report regarding his
September 30 and October 1 tests. These reports made clear that the hygienist
disputed FBS’s findings and that he deemed the currently ongoing remediation to be
unnecessary. Three days later, on December 19, 2019, Maxus sued Travelers in
Missouri state court for breach of contract and vexatious refusal to pay. Travelers
removed the case to the Western District of Missouri pursuant to federal diversity
jurisdiction.
A jury trial was held. At trial, Travelers argued that that soot from the Phase
6 fire did not reach the other buildings. Rather, it claimed, any soot present in Phases
1-4 was the normal result of background contamination from the neighborhood and
not from the fire.3 It also argued that—even if present and resulting from the Phase
6 fire—microscopic soot cannot constitute “physical loss or damage” as required
under the policy. As to the water damage, Travelers argued that any water damage
was neither caused by the fire nor occurred during the policy period. For its part,
Maxus asserted that both the soot remediation and the water damage resulting from
3 Travelers restricted its arguments to the microscopic soot present in Phases
1-4, as well as any additional microscopic soot present in Phase 5 beyond that for
which Maxus had already been compensated. It did not contest at trial, nor does it
contest on appeal, that the policy covered remediation expenses for the heavy, visible
soot in Phase 5.

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the leaks created by the burning embers were covered under the policy. It also
argued Travelers was liable under Missouri law for vexatious refusal to pay and
therefore subject to additional damages as well as an attorneys’ fees award. See Mo.
Rev. Stat. § 375.420 (2024) (providing that an insurance company that “has refused
to pay . . . without reasonable cause or excuse” may be subject to pay additional
damages as well as “a reasonable attorney’s fee”). Maxus presented the FBS
consultant—a currently-licensed building code official—who had produced the
relied-upon report. The FBS consultant critiqued the testing methodology of
Travelers’ industrial hygienist, suggesting that he purposely chose to sample in
locations where soot was unlikely to be discovered and had even cleaned each
location before gathering a sample. For its part, Travelers critiqued the background
of the FBS consultant, suggesting that he lacked the professional credentials and
educational background to serve as an expert witness.
The jury sided with Maxus and awarded all it had requested: $27,330,263.13
in damages, $546,905 for vexatious refusal to pay, and “reasonable attorneys’ fees.”
After trial, Maxus moved for calculation and award of attorneys’ fees and for
alteration of the judgment to include pre- and post-judgment interest. The district
court granted both motions. When calculating the attorneys’ fees award, it included
fees accrued before the complaint was filed as well as fees accrued by paralegal
professionals and other litigation support staff. Travelers moved for judgment as a
matter of law and for a new trial, which the district court denied. On appeal
Travelers raises six issues: (1) whether the presence of microscopic soot may
constitute “direct physical loss or damage,” (2) whether Maxus was required to
prove the water damage occurred during the policy period, (3) whether Maxus
presented sufficient evidence that Travelers vexatiously refused to pay Maxus’s
claims, (4) whether Travelers is entitled to a new trial due to erroneous jury
instructions, (5) whether the district court abused its discretion when calculating the
attorneys’ fees award, and (6) whether the district court properly calculated and
awarded prejudgment interest.

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II. Discussion
A. Microscopic Soot
We first address Travelers’ contention that it was entitled to judgment as a
matter of law because Maxus failed to prove that the presence of microscopic soot
in Phases 1-4 constituted a “direct physical loss of or damage to” property as
required under the policy. We review the denial of a motion for judgment as a matter
of law de novo, reviewing the sufficiency of the evidence to support the jury’s verdict
in the light most favorable to the prevailing party, and affirming unless no reasonable
juror could have reached the same conclusion. Joseph J. Henderson & Sons, Inc. v.
Travelers Prop. Cas. Ins. Co. of Am., 956 F.3d 992, 996 (8th Cir. 2020). “Judgment
as a matter of law is appropriate only when the record contains no proof beyond
speculation to support the verdict.” Wilson v. Brinker Int’l, Inc., 382 F.3d 765, 770
(8th Cir. 2004) (citation modified). Therefore, we “will not set aside a jury verdict
unless there is a complete absence of probative facts to support the verdict.” Id. at
769-70 (citation modified).
Sitting in diversity, we apply state substantive law. Sanborn Savings Bank v.
Freed, 38 F.4th 672, 677 (8th Cir. 2022). The parties here agree that Missouri law
governs. While Missouri courts have yet to address whether or when the presence
of microscopic soot might constitute physical damage, they have provided some
guidance. The Missouri Court of Appeals recently held that a policy’s requirement
of “‘direct physical loss of or damage to’ property,” meant the loss or damage must
be “directly material, perceptible, or tangible.” BBX Cap. Corp. v. Scottsdale Ins.
Co., 713 S.W.3d 590, 595, 603 (Mo. Ct. App. 2025). Thus, the BBX court reasoned,
COVID-19 contamination was not covered damage because it did not cause a
“physical alteration or tangible impact to” the insured property. Id. at 605. The BBX
court took care to distinguish the COVID-19 virus from asbestos—which would be
covered under the policy—because “released asbestos fibers are a form of
contamination that is permanent absent some intervention.” Id. at 606. This is in
accord with several of our recent decisions where we interpreted “physical loss or

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. . . damage” as not including COVID-19-related business interruption expenses due
to a lack of “physical” damage. See K.C. Hopps, Ltd. v. Cincinnati Ins. Co., 78 F.4th
1002, 1004-05 (8th Cir. 2023) (collecting cases). BBX is also in line with Instruction
No. 18, which informed the jury that “direct physical loss of or damage to” should
be understood to mean that “the property has suffered some physicality to the loss
or damage to the property—e.g., a physical alteration, physical contamination, or
physical destruction.”
Here, a reasonable jury could find that soot contaminated Phases 1-4.
“Contaminate” may be defined as “to soil, stain, corrupt, or infect by contact or
association.” Webster’s Third New International Dictionary 491 (1981). Maxus
presented ample evidence regarding the presence of soot throughout Phases 1-4, as
well as regarding the extensive remediation procedures that were required to remove
the soot. Cf. Olmsted Med. Ctr. v. Cont’l Cas. Co., 65 F.4th 1005, 1010-11 (8th Cir.
2023) (pointing out that COVID-19 contamination could be removed by “routine
cleaning procedures” or would “dissipate on its own in a matter of days, if not
sooner”).
Travelers does not dispute that soot was present in Phases 1-4 but instead
argues that the presence of microscopic soot is not “physical” damage unless the
soot is visible or affects the object’s structural integrity. This goes beyond Missouri
law. Soot damage—like asbestos damage and unlike a virus—is both “directly
material, perceptible, or tangible” and “permanent absent some intervention.” See
BBX, 713 S.W.3d at 603, 606; see also Creative Consolidation, LLC v. Erie Ins.
Exch., 311 A.3d 902, 908 (D.C. 2024) (contrasting COVID-19 virus with smoke that
leaves “tangible parts of ash and soot on surfaces or in HVAC systems”).
The dissent—while conceding that the soot caused some physical damage—
would nonetheless vacate most of the damages award because the physical damage
was not extensive enough to justify Travelers’ reimbursement of Maxus’s
remediation of Phases 1-4. It would require Maxus to present evidence that the soot
made remediation necessary by creating a risk of future physical deterioration or by

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posing a health hazard. However, Travelers has not raised the issue of damages
related to Maxus’s remediation; it has simply challenged whether sufficient evidence
existed to support the jury’s finding that soot was a “direct physical loss . . . or
damage” under the policy. The dissent’s concerns over the remediation’s
justification are not relevant to that issue. The instructions did not require the jury
to find that the full extent of remediation was “justified,” nor did they mention a risk
of deterioration or a health hazard. They simply required Maxus to demonstrate that
the presence of soot was “direct physical loss or damage to the property” and that
soot “was present at the Metropolitan.” Travelers not only declined to object to the
jury instructions on this basis, but it requested an instruction that did not mention a
risk of deterioration either. Rather, its proposed instruction stated that contamination
that has “a physical effect on the property” can constitute physical damage and that
“[a] substance that can be eliminated by routine cleaning procedures does not have
a physical effect on property.” Moreover, prior to trial, Travelers successfully
moved to preclude the admission of any “evidence regarding the health effects of
combustion byproducts.” Therefore, even to the extent Missouri law might require
such evidence, Travelers has waived its claim to a jury finding on whether the soot
remediation was justified. See Fed. R. Civ. P. 51; Riley v. Bondi, 606 U.S. 259, 273
(2025) (“If a party neglects to raise, concedes, or waives an issue, a court generally
has no obligation to consider it.”). Sufficient evidence existed to support the jury’s
verdict.
B. Water Damage
We next address Travelers’ contention that it was entitled to judgment as a
matter of law because Maxus failed to present evidence that the water damage—
which was caused by the ember hole leaks—occurred before the policy expired.
Travelers argues that we should invalidate this award under the “manifestation rule”
that has been adopted in some jurisdictions. See Prudential-LMI Com. Ins. v.
Superior Ct., 798 P.2d 1230, 1243-47 (Cal. 1990) (finding an insurer was only
responsible for damage that “manifested” before the policy expired).

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Even if Missouri was to adopt the manifestation rule—which, as Travelers
admits, it has not yet done—Travelers’ argument fails. If a jurisdiction has adopted
the manifestation rule, then “the carrier insuring the risk when the damage first
becomes apparent remains responsible for indemnifying the loss until the damage is
complete.” Id. at 1245. This remains true even if the insurance policy “purports to
limit coverage to losses” which occurred during the policy term. Id. The term
“manifestation” refers to “that point in time when appreciable damage occurs and is
or should be known to the insured.” Id. at 1247. Thus, if damage has manifested
within the policy period but worsens after the policy expires, the initial insurer is
responsible for the entirety of the damage. See id. On the other hand, if the cause
of damage exists but lies dormant and “no damage or injury of any kind” occurs
before manifestation, then liability is placed on the party carrying the risk when the
damage finally manifests. Id. at 1246 (emphasis added).
Here, Travelers argues that the damage “manifested”—was known or should
have been known by a reasonable insured, id. at 1247—when the water damage was
discovered over six months after the fire. But that is a distortion of the manifestation
rule, which holds insurers responsible for indemnifying a loss caused by damage that
first occurs during the policy period but that worsens after the policy’s expiration.
See id. at 1245-47. Here, damage first occurred on the date of the fire, September
27, 2018, when embers burned holes in the roof. As the insurance provider on that
date, Travelers is liable for any continuing damage caused by the ember-hole leaks.
See id. at 1246. At trial, the FBS consultant testified in detail about how the ember
leaks caused the water damage, distinguishing between the water damage caused by
the ember-hole leaks and the water damage caused by preexisting construction
defects. Even assuming Missouri would adopt the manifestation rule, Travelers was
not entitled to judgment as a matter of law because sufficient evidence existed to
support the jury’s finding that the water damage was covered under the policy
because the fire caused the water damage and the damage had manifested before the
policy expired. See Wilson, 382 F.3d at 769 (holding that we will not set aside the
jury’s verdict on appeal “unless there is a complete absence of probative facts to
support the verdict”).

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C. Vexatious Refusal to Pay
We next address Travelers’ contention that it was entitled to judgment as a
matter of law because Maxus failed to present sufficient evidence that Travelers
acted vexatiously. To prove a claim of vexatious refusal under Missouri law, “the
insured must show the insurer’s refusal to pay the claim was willful and without
reasonable cause, as the facts would appear to a reasonable and prudent person.”
Morris v. J.C. Penney Life Ins. Co., 895 S.W.2d 73, 76 (Mo. Ct. App. 1995) (per
curiam); see also Mo. Rev. Stat. § 375.420 (2024). Missouri usually protects
insurers from vexatious refusal claims when the case “involves a reasonably litigable
issue.” Morris, 865 S.W.2d at 76. Here, Travelers argues that it was entitled to
judgment as a matter of law on the vexatious refusal claim because its refusal to pay
was—at a minimum—based on the existence of reasonably litigable issues. We
agree that reasonably litigable issues existed. The microscopic soot claim presented
a novel issue and the other coverage issues were also subject to reasonable dispute,
especially given the presence of preexisting construction defects.
However, the presence of a reasonably litigable issue does not necessarily bar
a vexatious refusal claim under Missouri law if “there is evidence that the insurer’s
attitude was vexatious and recalcitrant in refusing the claim.” Id. A jury may find
vexatiousness if the insurer refused to pay based on an inadequate investigation or
if it denied liability without explanation. Tauvar v. Am. Fam. Mut. Ins. Co., 269
S.W.3d 436, 439 (Mo. Ct. App. 2008). Here, Maxus presented sufficient evidence
to support a finding of vexatiousness on either basis. The jury heard evidence that
Travelers’ inspector collected samples in locations where soot was unlikely to be
discovered and employed a sampling methodology that seemed purposefully
designed to minimize the likelihood of discovering soot. Further, Travelers refused
to indicate whether it would cover the soot remediation until after it had received its
hygienist’s final report but then declined to communicate the hygienist’s initial
findings until December—after Maxus had begun remediation—despite receiving
his report in August. It never even issued a denial letter or provided a justification
as to why it had effectively denied coverage. Rather, in response to Maxus’s

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requests for advice as to what would be covered, necessary, and considered
reasonable, Travelers continued to reiterate that it could not “take a position.”
Sufficient evidence supports the jury’s vexatious refusal award.
D. Jury Instructions
We next address Travelers’ contention that the jury instructions were
erroneous and that it is therefore entitled to a new trial. “In diversity cases the
substance of jury instructions is a matter governed by the applicable state law.
Accordingly, the jury instructions, when read as a whole, must fairly and adequately
present the relevant state law.” Acad. Bank, N.A. v. AmGuard Ins. Co., 116 F.4th
768, 787 (8th Cir. 2024). We review the district court’s choice of jury instructions
for abuse of discretion. Id. at 786.
Travelers argues the jury instructions were erroneous because: (1) they
permitted a jury to conclude that the mere presence of microscopic soot could satisfy
the policy’s “direct physical loss of or damage to property” requirement; (2) the
district court did not instruct the jury that Maxus bore the burden of proof; and (3)
the district court did not instruct the jury that damage from faulty workmanship was
not recoverable. All three arguments fail.
First, regarding whether microscopic soot may constitute a physical loss, the
challenged jury instructions state:
Jury Instruction No. 18: Wherever in these instructions the phrase
“direct physical loss of or damage to” is used, that means the property
has suffered some physicality to the loss or damage to the property—
e.g., a physical alteration, physical contamination, or physical
destruction.
Jury Instruction No. 24: Your verdict must be for Plaintiff Maxus
Metropolitan, LLC on the Soot Claim if you believe: First, that the
presence of soot, ash, smoke, or char is direct physical loss or damage

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to property; and Second, that soot, smoke, or char was present at the
Metropolitan . . . .
These instructions fairly and adequately present the relevant law. Instruction No. 18
explains that covered damage must have a physical component. See K.C. Hopps, 78
F.4th at 1004. And Instruction No. 24 requires the jury to determine whether the
presence of soot constituted a “direct physical loss or damage.” The instructions
read as a whole fairly and adequately present Missouri law on the issue of whether
microscopic soot may constitute a physical loss, and we detect no abuse of
discretion.
Second, we need not decide whether the district court erred by neglecting to
clarify that Maxus bore the burden of proof, because Travelers failed to properly
object. A party may not claim that the district court erred by omitting a jury
instruction unless that “party properly requested [the omitted instruction] and . . .
also properly objected.” Fed. R. Civ. P. 51(d)(1)(B). “A party who objects to . . .
the failure to give an instruction must do so on the record, stating distinctly the matter
objected to and the grounds for the objection.” Id. 51(c)(1). At the instructions
conference, Travelers stated that it had no objection to Instruction No. 14.4 It later
objected “to the court’s failure to give any instruction on the burdens of proof under
[the] insurance policy” and referenced its own proposed jury instruction, but did not
explain why it believed its preferred burden of proof instruction was required. This
does not constitute a proper objection. Further, Travelers’ purported objection made
little sense at the time, given that the district court did instruct on the burden of
proof—in the previously-undisputed, now-contested-on-appeal Instruction No. 14.
Travelers’ challenge fails.
4 Instruction No. 14 read, in relevant part: “You must decide whether certain
facts have been proved by the greater weight of the evidence. A fact has been proved
by the greater weight of the evidence, if you find that it is more likely true than not
true.”

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Third, the district court did not err by omitting a faulty workmanship
instruction. Courts are “required to instruct the jury on a defense only when
substantial evidence to support the defense has been presented.” State v. Hudson,
643 S.W.3d 679, 686 (Mo. Ct. App. 2022). Here, Travelers argues the district court
should have instructed the jury that any damages resulting from faulty workmanship,
rather than the fire, were not recoverable. But Travelers failed to present any
evidence that the claimed damages were caused by faulty workmanship. Indeed, to
the contrary, Travelers’ only support for a faulty workmanship instruction came
from the testimony of a single witness who, as the district court pointed out, “opined
that certain damages at The Metropolitan were caused by faulty workmanship but
could not testify that Maxus was claiming any of those damages in the lawsuit.”
Maxus Metropolitan, LLC v. Travelers Prop. Cas. Co. of Am., No. 20-CV-0095-
FJG, 2024 WL 358232, at *11 (W.D. Mo. Jan. 3, 2024). Indeed, on appeal Travelers
points to no supporting evidence but instead argues that a faulty workmanship
instruction was warranted because Maxus’s evidence called for that inference on its
own. This is not what Missouri law requires, see Hudson, 643 S.W.3d at 686;
therefore, the district court did not abuse its discretion.
E. Attorneys’ Fees
We next address Travelers’ contention that the district court abused its
discretion in calculating the attorneys’ fees award. Travelers argues that it should
be recalculated to (1) remove any fees related to pre-suit legal advice and (2) exclude
litigation expenses provided by paralegals and other litigation support team
members. In Missouri, “attorneys’ fees may be awarded when they are provided for
in a contract or when they are authorized statutorily.” Berry v. Volkswagen Grp. of
Am., Inc., 397 S.W.3d 425, 431 (Mo. 2013). Here, attorneys’ fees are authorized by
Missouri’s vexatious refusal to pay statute. Mo. Rev. Stat. § 375.420 (2024) (“In
any action against any insurance company to recover the amount of any loss under
a policy,” the court or jury may allow “a reasonable attorney’s fee.”). We review
the grant of attorneys’ fees for abuse of discretion. Jet Midwest Int’l Co. v. Jet
Midwest Grp., LLC, 93 F.4th 408, 416 (8th Cir. 2024).

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First, Travelers contends that the authorizing statute’s reference to “[i]n any
action” limits attorneys’ fees to those accrued during litigation—and thereby
excludes any accrued before the suit was filed. In support, Travelers points out that,
as a penal statute, § 375.420 should be strictly construed. It also points to the
Missouri Supreme Court’s direction to trial judges to consider—among six other
factors—“the number of hours reasonably expended on the litigation.” Berry, 397
S.W.3d at 431. These arguments fail. Even strictly construed, § 375.420 places no
parameters for when attorneys’ fees may begin to accrue. Further, Missouri courts
are highly deferential to a trial court’s determination regarding attorneys’ fees: “The
trial court is deemed an expert at fashioning an award of attorneys’ fees and may do
so at its discretion.” Id. at 430. To prevail, Travelers “must show the trial court’s
decision was against the logic of the circumstances and so arbitrary and unreasonable
as to shock one’s sense of justice.” See id. at 431. Awarding attorneys’ fees that
accrued before a suit was filed does not shock one’s sense of justice—especially
considering the jury found Travelers liable for vexatious refusal to pay because of
its actions during that period. See Ray Haluch Gravel Co. v. Cent. Pension Fund of
Int’l Union of Operating Eng’rs & Participating Emps., 571 U.S. 177, 189 (2014)
(“The fact that some of the claimed fees accrued before the complaint was filed is
inconsequential.”).
Second, Travelers contends that the award should be reduced because
§ 375.420’s “reasonable attorney’s fee” does not include paralegal and other non-
lawyer fees. However, the Missouri Supreme Court has held that “reasonable
attorney fees” include “reasonably incurred, out-of-pocket litigation expenses that
would normally be charged to a fee-paying client.” Wilson v. City of Kansas City,
598 S.W.3d 888, 897 (Mo. 2020). Paralegal fees and litigation support personnel
fees usually fall into this category. See Missouri v. Jenkins, 491 U.S. 274, 285 (1989)
(finding “self-evident” that the work of paralegals and other litigation support staff
should be considered part of a “reasonable attorney’s fee”). The trial court did not
abuse its discretion when calculating the attorneys’ fees.

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F. Prejudgment Interest
We finally address Travelers’ contention that the district court erred when it
awarded prejudgment interest to Maxus. Missouri law provides that a party with an
outstanding account is entitled to prejudgment interest so long as it has made a
definite demand for payment and “the amount owed is liquidated or readily
ascertainable.” Child. Int’l v. Ammon Painting Co., 215 S.W.3d 194, 203 (Mo. Ct.
App. 2006); see also Mo. Rev. Stat. § 408.020 (2024). “Awards of prejudgment
interest are not discretionary; if the statute applies, the court must award
prejudgment interest.” Child. Int’l, 215 S.W.3d at 203. Travelers asserts the
prejudgment interest award should be reversed because: (1) Maxus failed to prove it
made definite demands supporting its calculation, (2) the amount owed was not
readily ascertainable before trial, and (3) a good faith dispute existed as to whether
Travelers was liable. We reverse in part, finding that the district court properly
awarded prejudgment interest but that it erred when it calculated the amount of
interest based on the dates Maxus paid the invoices without considering the dates
Maxus demanded payment from Travelers.
First, Travelers argues that the district court erred when it calculated the
prejudgment interest beginning thirty days after Maxus paid its contractors’
invoices, rather than when Maxus “demanded” payment from Travelers. Missouri
law provides that prejudgment interest accrues on unpaid accounts “after they
become due and demand of payment is made.” Mo. Rev. Stat. § 408.020 (2024).
The demand must be “definite as to both time and amount.” Child. Int’l, 215 S.W.3d
at 203. Here, therefore, the prejudgment interest calculation depends on the date
Maxus “demanded” payment from Travelers. Maxus asserts that it demanded
payment the very day of the fire. But it would have been impossible to reasonably
ascertain the amount of damage at that time. And, indeed, the district court did not
calculate prejudgment interest based on when the damage occurred but rather based
on when Maxus paid each invoice—in other words, after the amount due had become
“readily ascertainable.” See Columbia Mut. Ins. Co. v. Long, 258 S.W.3d 469, 480
(Mo. Ct. App. 2008). The record is unclear as to when Maxus forwarded the invoices

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to Travelers. Missouri law does not allow interest to be charged on an account until
payment for it has been demanded. Mo. Rev. Stat. § 408.020 (2024). If Maxus
delayed in forwarding invoices to Travelers, then the prejudgment interest
calculation must be based on the date each invoice was forwarded, and thus
demanded, not based on the date each invoice was paid by Maxus. Therefore, further
fact finding is necessary to determine when Maxus forwarded the invoices to
Travelers. Then, if the facts require, the amount of prejudgment interest must be
recalculated based on the dates Maxus demanded payment from Travelers rather
than the dates Maxus paid the invoices.
Second, Travelers argues that prejudgment interest was improperly awarded
because the damages were not “liquidated” before trial, but rather required judgment
calls to determine which invoices were related to fire damage and which were caused
by construction defects. This argument fails. Damages are considered “liquidated”
once they have become due and are either fixed and determined or are “readily
ascertainable by computation or a recognized standard.” Long, 258 S.W.3d at 480.
“An exact calculation of damages need not be presented in order for the claim to be
considered liquidated.” Comens v. SSM St. Charles Clinic Med. Grp., Inc., 335
S.W.3d 76, 82 (Mo. Ct. App. 2011). Even when the parties dispute the value or
proper computation of damages, damages may still be ascertainable. Id. Here,
damages were readily ascertainable at the time each invoice was issued. Like in
Long, “[f]rom the date that [Maxus] reported [its] loss, [Travelers] was in a position
to conduct a full investigation into that loss. Indeed, [Maxus] repeatedly asked that
[Travelers] do so.” Long, 258 S.W.3d at 480. This holds true for the lost business
income as well as the remediation damages, because it was readily computable under
the policy. While Missouri generally does not allow prejudgment interest on lost
profits, an exception exists when those lost profits are based on a predetermined
contractual amount. See Invs. Title Co. v. Chicago Title Ins. Co., 983 S.W.2d 533,
538-39 (Mo. Ct. App. 1998). The lost business income award here is one such
predetermined contractual amount, as the policy lays out precisely how the “business
interruption” expenses should be calculated. Indeed, Travelers does not dispute the
formulas and methods used to determine the business interruption expense. And

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contrary to the dissent’s assertion, Travelers was fully aware of what it owed. Maxus
provided proof of loss for its business income claim in August 2019, and Travelers
knew the total amount requested since at least October 2020. Damages were
liquidated.
Third, Travelers argues that the district court erred in awarding prejudgment
interest because a good faith dispute existed as to whether it was liable for the
remediation damages. This argument fails outright under Missouri law: “The mere
fact that a party denies liability or defends a claim against him or her, or even the
existence of a bona fide dispute as to the amount of the indebtedness, does not
preclude recovery of interest . . . .” Comens, 335 S.W.3d at 82 (citation modified).
Altogether, the district court did not err in awarding prejudgment interest but
erred by calculating the interest based on the invoice payment dates rather than based
on the dates payments were demanded. Accordingly, we vacate the prejudgment
interest award and remand for recalculation.
III. Conclusion
For the foregoing reasons, we affirm the district court’s denial of Travelers’
motions for judgment as a matter of law and for a new trial as well as its grant of
attorneys’ fees. We vacate its grant of prejudgment interest and remand for
recalculation based on further fact finding.
ARNOLD, Circuit Judge, concurring in part and dissenting in part.
I concur in the court’s explanation for affirming the judgment on Maxus’s
water damage claim and in the court’s decision to vacate the prejudgment interest
award that Maxus received, but I otherwise dissent. Maxus may well have spent over
fifteen million dollars cleaning the combustion byproducts that the parties
generically call soot out of the first four buildings, or “phases,” of the Metropolitan
apartment complex. But the record does not support the jury’s finding that this soot

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caused over fifteen million dollars in costs covered by Maxus’s insurance policy
with Travelers. What it reveals, instead, is less than three thousand dollars of covered
soot damage to a single access control system in those phases. I would therefore
reverse the district court’s judgment on the Phase-One-through-Four soot damage
claim except the part of it attributable to the access control system damage. I would
vacate the district court’s judgment on Maxus’s claim that Travelers vexatiously
refused to pay under the policy, which depends on the soot damage claim. And in
vacating the prejudgment interest award, I would instruct the district court that
prejudgment interest could not accrue on Maxus’s business interruption damages
because they are either speculative or entirely unproven.
Start with soot damages. I would substantially reverse the judgment in favor
of Maxus on its claim that Travelers failed to cover combustion byproducts
remediation in Phases One through Four because, with one exception, combustion
byproducts caused no direct physical loss of or damage to those buildings and thus
there was no covered injury under Maxus’s insurance policy. Maxus proved only
that combustion byproducts destroyed wiring in a single access control system, and
I would reduce the damages award for the claim accordingly.
Maxus’s policy was an all-risks policy. Travelers had to pay for any loss to
covered property, including Phases One through Six. But, as both parties recognize,
a loss had to be “direct physical loss of or damage to Covered Property.” Under
Missouri law, on which the parties rely, that means that there must have been “some
physicality to the loss or damage of property—e.g., a physical alteration, physical
contamination, or physical destruction.” See K.C. Hopps, Ltd. v. Cincinnati Ins. Co.,
Inc., 78 F.4th 1002, 1004 (8th Cir. 2023); Planet Sub Holdings, Inc. v. State Auto
Prop. & Cas. Ins. Co., Inc., 36 F.4th 772, 775 (8th Cir. 2022); Monday Rests. v.
Intrepid Ins. Co., 32 F.4th 656, 658 (8th Cir. 2022); BBX Cap. Corp. v. Scottsdale
Ins. Co., 713 S.W.3d 590, 606 (Mo. Ct. App. 2025).
The Court is right, as a threshold matter, that combustion byproducts can
sometimes cause physical loss of or damage to property under this standard as a sort
of contamination. The justification for contamination claims that seems to underlie

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the few relevant Missouri contamination cases is that the union between a
contaminant and the property it contaminates is a physical phenomenon so long as
the union is “permanent absent some intervention.” See BBX Cap., 713 S.W.3d at
606; Planet Sub Holdings, 36 F.4th at 776. As this case illustrates, combustion
byproducts can be hard to remove from property they infiltrate. And they can also
adversely affect that property. The property may emit toxic particles when disturbed
or through a passive process called “off gassing.” Its components, if made of
vulnerable materials, may also degrade with exposure to the byproducts. In
important respects, combustion byproducts contamination causes harm that is no less
physical than one harm Missouri courts already treat as physical: asbestos
contamination. See Cincinnati Ins. Co. v. German St. Vincent Orphan Ass’n, Inc., 54
S.W.3d 661, 667 (Mo. Ct. App. 2001).
But Maxus’s combustion byproducts contamination claim is fatally flawed
because the company presented no evidence that the physical harm such byproducts
can cause actually occurred here to an extent justifying the millions of dollars in
damages it received. Maxus’s only evidence of physical harm was testimony that a
single access control system suffered wiring damage “consistent with exposure to
fire particulate.” The jury could award Maxus the $2,454.90 cost to fix this wiring,
but Maxus cites nothing suggesting that combustion byproducts caused any other
property to deteriorate or even that they accumulated on vulnerable materials in
concentrations that created a risk of foreseeable deterioration. Maxus hardly
addresses deterioration at all in its brief, in fact, relegating the topic to a single
sentence in a footnote referencing the access control system.
Maxus instead emphasizes the health hazards combustion byproducts can
pose, but the evidence failed to demonstrate that there was a health hazard here.
Travelers’s health expert offered the only relevant analysis, and he emphatically
testified that there was “no evidence indicating a risk from fire-related residue” in
Phases One through Four. For the “worst chemical” found in combustion byproducts
to pose such a risk, he explained, there would need to be “ounces to pounds of soot
deposited in the space” where a resident was living “24/7, 365 for ten years”—a

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level one might achieve by “painting walls with soot and char.” Unsurprisingly, there
was no evidence of combustion byproducts deposition on that scale.
Maxus’s counterargument is that there was a health risk because carbon
byproducts can be hazardous and there were some carbon byproducts in Phases One
through Four. That carbon byproducts can be hazardous does not mean that they are
hazardous in all circumstances and all concentrations. That is precisely why
Travelers’s health expert agreed with Maxus that combustion byproducts “can cause
severe health effects” while still maintaining that there was no health risk in Phases
One through Four. There were, he testified, not enough concentrated combustion
byproducts in the buildings to create the risk. And Maxus cites nothing calling that
conclusion into doubt. While its witnesses purported to identify “significant” levels
of combustion byproducts in some—though hardly all—particulate samples taken
from Phases One through Four, the classification was not medical; it was just an
assessment of how much the concentration of byproducts in the sample deviated
from background concentrations.
Maxus’s suggestion that the carbon byproducts were hazardous because “there
are no health-based standards or exposure limits for soot on surfaces” misses the
mark. There are no health-based standards for or limits on the number of bananas a
person should eat either, but as one commentator remarks of that radioactive fruit,
“for death to ensue, a million times a thousand, or a billion, bananas would have to
be consumed. And that would have to be at one sitting. Quite a challenge.” Joe
Schwarcz, Is It True that Bananas Are Radioactive?, Off. for Sci. & Soc’y, McGill
Univ. (Mar. 15, 2018), https://www.mcgill.ca/oss/article/you-asked/it-true-banana-
radioactive. The impropriety of inferring that things, carbon byproducts included,
are hazardous in any concentration because of the lack of medical guidance
concerning them should be plain. Maxus’s subjective fear, however sincere, of an
injury resulting from microscopic soot contamination and its desire to avoid any risk
of it is insufficient to support a claim against Travelers. The risk that Travelers
assumed was a real, detectable risk, and Maxus failed to produce evidence that there
was one. The general difficulty, if there is one, of proving that such a risk existed
cannot relieve Maxus of its duty to do so.

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To the extent that Maxus relies on lay opinions that carbon byproducts
remediation was reasonable or necessary, it fails to rebut the evidence that carbon
byproducts posed no health risks in Phases One through Four. For one thing, many
of the opinions concern only the efficiency of the remediation procedures rather than
the need for remediation in the first place.
More importantly, though, lay witnesses were not qualified to estimate the
concentration of carbon byproducts that was hazardous. As Travelers notes, “expert
testimony is necessary and, therefore, required” when “a fact at issue is so technical
or complex that no fact finder could resolve the issue without” it. Stone v. Mo. Dep’t
of Health & Senior Servs., 350 S.W.3d 14, 21 (Mo. banc 2011). That well describes
the problem of determining carbon byproducts toxicity at different concentrations.
Like evaluating whether smoke is unreasonably dangerous, see Reed v. Bob Barker
Co., Inc., 2014 WL 12575814, at *8 (W.D. Mo. Apr. 7, 2014), whether radiation at
certain levels creates a risk of cancer, see Butler v. Mallinckrodt LLC, 2022 WL
4598531, at *8 (E.D. Mo. Sept. 30, 2022), whether workplace conditions create a
risk that probably manifested in a disease, see Townser v. First Data Corp., 215
S.W.3d 237, 242 (Mo. Ct. App. 2007), or whether mold causes respiratory problems,
see Brown for Est. of Kruse v. Seven Trails Invs., LLC, 456 S.W.3d 864, 869 (Mo.
Ct. App. 2014)—all determinations requiring expert testimony—evaluating whether
a carbon byproducts concentration created a health risk requires medical knowledge
that an expert may have but a jury does not. Any lay opinion on that point was
insufficient to prove that a risk existed here.
Maxus hardly makes up for missing evidence of concrete physical harm to
Phases One through Four with its argument that Travelers admitted that physical
harm occurred anyway. There was no such admission: Travelers simply paid for
combustion byproducts remediation in Phase Five. That building was closer to the
fire in Phase Six than the other buildings and, in Travelers’s view, suffered damage
in addition to suffering from combustion byproducts deposition. Since coverage
depended on the occurrence of direct physical loss of or damage to property,
objecting to payment for combustion byproducts remediation in the buildings that
were less exposed to the fire and suffered no apparent damage is perfectly consistent

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with paying for such remediation in a building that was more exposed to the fire and
suffered some damage.
I would therefore hold that the evidence that combustion byproducts caused
physical loss of or damage to Phases One through Four was insufficient, with the
exception of evidence that combustion byproducts damaged an access control
system. And I would reduce the damages awarded to Maxus accordingly.
Reversing almost all of the judgment on the Phase-One-through-Four soot
damage claim requires vacating the judgment on Maxus’s vexatious refusal claim.
The latter judgment included both a penalty fixed by the jury and an award of
attorneys’ fees fixed by the district court, and both were contingent on the judgment
on the soot damage claim. So both need a fresh look to determine whether they are
appropriate despite the infirmities in the soot damage judgment.
The need for another look at the penalty is apparent from the face of the jury’s
verdict. The jury set the penalty as a percentage of Maxus’s recovery on its claims
under the insurance policy, including the Phase-One-through-Four soot damage
claim. See Mo. Rev. Stat. ' 375.420. This equaled twenty percent of the first fifteen
hundred dollars of the recovery, plus two percent of the rest of the recovery. But if
the jury had known that Travelers was not obliged to cover most of the Phase-One-
through-Four soot damage, it likely would have adjusted the percentage. It may, in
fact, have found that Travelers did not act vexatiously at all and declined to impose
any penalty. The evidence the court identifies that Travelers vexatiously refused to
pay a claim pertains only to Travelers’s handling of the Phase-One-through-Four
soot damage claim, and the same is true of nearly all the additional evidence that
Maxus identifies. So the prudent course would be to vacate the current penalty and
let a jury consider a new one with the understanding that Travelers was entitled to
deny almost all of that claim. Cf. Robertson Oil Co. v. Phillips Petroleum Co., 871
F.2d 1368, 1376 (8th Cir. 1989).
The attorneys’ fees award likewise merits reconsideration. If a new jury finds
that Travelers did not act vexatiously, then the award cannot stand because there is

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no basis for it. The authorization for the award came from the statute permitting an
insured to recover attorneys’ fees if its insurer vexatiously refuses to pay a claim.
See Mo. Rev. Stat. ' 375.420; see also Dean v. Olibas, 129 F.3d 1001, 1006 & n.5
(8th Cir. 1997). But even if it were certain that a new jury would find that Travelers
behaved vexatiously, it would still be wise to remand to the district court to
reevaluate the magnitude of the fees that Maxus should recover. The district court
expressly relied on “the 100% successful result achieved by” Maxus at trial as
support for its award. Since the evidence did not support that result, the district court
might well reduce the fees it allowed if the issue came before it again. See Chavez-
Lavagnino v. Motivation Educ. Training, Inc., 767 F.3d 744, 753 (8th Cir. 2014).
Travelers would have us apply similar reasoning to the business interruption
damages that the jury awarded to Maxus, but that would be a mistake. Though it is
true that the jury’s misunderstanding about coverage of Phase-One-through-Four
soot damage might have affected the award, it might not have, and Travelers is
responsible for the uncertainty.
The verdict form that the jury used had a single blank for the jury to fill with
the total business interruption damages that Maxus would recover. Among other
things, that total was supposed to include covered business interruption damages
from soot accumulation in Phases One through Four, which led Maxus to evacuate
tenants, and from fire damage to Phases Five and Six, which led to repairs and
reconstruction before tenants were admitted. And coverage, again, extended only to
the consequences of “direct physical loss of or damage to” the Metropolitan. Maxus,
recall, almost entirely failed to prove that soot caused any such loss of or damage to
Phases One through Four, and it certainly proved less than what was necessary to
warrant the evacuation. But recall also that the jury wrongly held Maxus liable for
extensive non-business-interruption damage purportedly caused by soot in Phases
One through Four. So how can we tell whether it topped up the total business
interruption award with unsupported damages it attributed to the soot in those
phases? There was, after all, evidence that business interruption damages attributable
to the other phases could support the whole award. In a typical case, the only option

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would be to remand for a new trial to supply the answer. See Friedman & Friedman,
Ltd. v. Tim McCandless, Inc., 606 F.3d 494, 502 (8th Cir. 2010).
But in this case, there is no need to ask the question in the first place because
there is a catch: Travelers proposed the single-blank verdict form. A party cannot be
heard to complain when a district court gives it the verdict form it requested.
Travelers created a risk of confusion when it invited the jury to aggregate different
business interruption damages, and it must live with the results. See Hoechst
Celanese Corp. v. BP Chems. Ltd., 78 F.3d 1575, 1581 (Fed. Cir. 1996).
That brings me to the last part of the district court’s judgment that is
intertwined with the award of unproven Phase-One-through-Four soot damages. The
district court’s prejudgment interest award includes some interest accruing on those
damages, which is reason enough to vacate it in part. But the court is right to vacate
the award in full because it has another, broader flaw. As the court explains, the
district court generally allowed interest to accrue on claimed damages before Maxus
demanded that Travelers pay the damages, and Missouri law prohibits that. Under
the governing Missouri statute, interest accrues “for all moneys after they become
due and payable, on written contracts, and on accounts after they become due and
demand of payment is made.” See Mo. Rev. Stat. ' 408.020. It is not self-evident
that sums owed under an insurance policy are “accounts” whose payment an insured
must demand rather than moneys due and payable under a written contract. See
Hocker Oil Co. v. Barker-Phillips-Jackson, Inc., 997 S.W.2d 510, 521 n.8 (Mo. Ct.
App. 1999). But our precedent teaches that “interest upon a claim against an insurer’s
contractual obligation runs from the date of the demand made by the insured, unless
otherwise specified.” U.S. Fid. & Guar. Co. v. Empire State Bank, 448 F.2d 360,
369 (8th Cir. 1971). Since no such specification appears in the parties’ dealings here,
the district court violated that principle by allowing pre-demand interest to accrue.
I part ways with the court’s approach to prejudgment interest, however, to the
extent that the court blesses a new prejudgment interest award calculated by merely
changing the initial interest accrual date or dates. It is not just that some of the Phase-
One-through-Four soot damages on which such interest would accrue lack support

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in the record. The court also approves an award of interest on Maxus’s business
interruption damages, and that award would be unduly speculative even if the
damages were unrelated to the soot in the first four phases.
Under the statute that controls here, interest generally accrues on a claim only
if it is liquidated, meaning that it is “fixed and determined or readily determinable.”
See Macheca Transp. Co. v. Phila. Indem. Ins. Co., 737 F.3d 1188, 1196 (8th Cir.
2013). This protects parties who are unaware of the amount they owe. See id. And
we have observed, in dictum, that an insurance “claim for lost business income is
very similar to a claim for lost profits,” see id. at 1197, which is unliquidated
“because lost profits are inherently counterfactual, seeking damages for what might
have hypothetically occurred.” See Penzel Constr. Co. v. Jackson R-2 Sch. Dist., 635
S.W.3d 109, 137 (Mo. Ct. App. 2021).
Whatever the limits of this analogy, it is persuasive when it comes to Maxus’s
business interruption claim. If the business interruption damages Maxus recovered
did not reflect the lost income from evacuating Phases One through Four to clean
out soot, which Travelers had no obligation to cover, then they reflected lost income
from the other phases, which Maxus had not even finished building. Projecting
income from hypothetical tenants at properties still under construction is precisely
the sort of assumption-heavy, counterfactual exercise that a typical lost profits claim
requires and that a defendant is not expected to treat as a good estimate of what it
owes. See Bailey v. Hawthorn Bank, 382 S.W.3d 84, 91, 107 (Mo. Ct. App. 2012).
The case the court cites as authority for allowing prejudgment interest on such
projected income held, in fact, that prejudgment interest could not accrue on the
profits that the plaintiff anticipated but “failed to realize.” See Invs. Title Co. v. Chi.
Title Ins. Co., 983 S.W.2d 533, 538 (Mo. Ct. App. 1998). So too here.
The rule that a plaintiff may recover prejudgment interest on contractually
predetermined lost profits, if such a rule exists, does not extend to the circumstances
before us. The opinion in the cited case, from which the court derives the rule,
discussed predetermination only in mentioning an agreement to split a
“predetermined share” of profits as a fact distinguishing Schmidt v. Morival Farms,

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a case in which the Missouri Supreme Court permitted prejudgment interest on lost
profits. See id. at 538–39. The Missouri Supreme Court’s own opinion reveals that
its decision turned on the fact that the parties before it, who had agreed to share the
profits of a farm in fixed percentages, had access to the income and expense figures
used to calculate the profits, discussed them before interest accrued, and largely
agreed on them. See Schmidt v. Morival Farms, 240 S.W.2d 952, 961 (Mo. 1951).
Together, these precedents suggest at most that a defendant may be liable for
prejudgment interest on lost profits under a contract if the contract tells the parties
how to calculate the profits and the components of that calculation are facts the
defendant could readily ascertain. But they do not suggest that Travelers was liable
for prejudgment interest on Maxus’s hypothetical estimate of its lost income.
Travelers agreed to cover Maxus’s business interruption losses; it did not agree to
the counterfactual assumptions underlying that estimate. It had no more notice of its
total liability than a buyer who repudiates a minimum purchase agreement and thus
knows that it must compensate its seller for lost profits on unpurchased items but
does not know the extent of the profits. And such a buyer has no obligation to pay
prejudgment interest on lost profits. See Scullin Steel Co. v. PACCAR, Inc., 708
S.W.2d 756, 760, 766 (Mo. Ct. App. 1986).
That leaves one loose end: Travelers’s argument that improper jury
instructions tainted Maxus’s recovery of non-business-interruption soot damages to
Phases One through Four. After reducing those damages to the amount that Maxus
sufficiently proved, that argument loses any heft it might have. The reduced damages
covered the cost of repairing or replacing the soot-damaged access control system,
and the challenged instructions were not responsible for Maxus’s recovery of that
cost. That recovery occurred because Maxus offered testimony that soot caused a
quantified amount of physical damage to the access control system and Travelers
did not offer contrary evidence. Even on appeal, Travelers does not seriously dispute
that Maxus’s policy required it to cover the quantified damage. Were the jury
instructed, as Travelers insists that it should have been, that Maxus had the burden
of proof, that the mere presence of soot in Phases One through Four was not covered
damage, and that certain damage caused by faulty workmanship was not covered

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either, the jury almost certainly would have still awarded Maxus the same amount
for the quantified damage to the access control system. There is no sense vacating
the current award just to reach an identical outcome. Cf. K.C. Hopps, 78 F.4th at
1005; Beshears v. Asbill, 930 F.2d 1348, 1352 (8th Cir. 1991).
I would therefore affirm the award of damages for repair or replacement of
the access control system, as well as the judgment on Maxus’s Phase-One-through-
Four water damage claim. But I would reverse the rest of the judgment on Maxus’s
Phase-One-through-Four soot damage claim, vacate the intertwined judgment on
Maxus’s vexatious refusal claim, and vacate Maxus’s prejudgment interest award
with instructions not to allow interest on business interruption damages.
______________________________

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