United States District Court, W.D. Texas, Austin Division
SPARKS UNITED STATES DISTRICT JUDGE.
REMEMBERED on this day the Court reviewed the file in the
above-styled cause, and specifically Defendant Federal
Insurance Company (FIC)'s Motion for Summary Judgment
Against Defendant Axis Surplus Insurance Company (Axis)
[#81], Axis's Response [#90] in opposition, and FIC's
Reply [#96] in support; Intervenor Plaintiff First Mercury
Insurance Company (First Mercury)'s Motion for Summary
Judgment Against Axis [#85], Axis's Response [#91] in
opposition, and First Mercury's Reply [#101] in support;
Plaintiff Liberty Mutual Fire Insurance Company
(Liberty)'s Motion for Summary Judgment Against Axis
[#86], Axis's Response [#95] in opposition, and
Liberty's Reply [#97] in support; Defendant Axis's
Motion for Summary Judgment Against FIC and First Mercury
[#88], FIC's Response [#92] in opposition, First
Mercury's Response [#94] in opposition, and Axis's
Replies [#98] and [#99] in support; as well as Defendant
Axis's Motion for Summary Judgment Against Plaintiff
Liberty [#89], Liberty's Response [#93] in opposition,
and Axis's Reply [#100] in support. Having considered
the case file and the applicable law, the Court enters the
following opinion and order.
an insurance-coverage-dispute case related to an oilfield
explosion at a wellsite located on Peeler Ranch in McMullen
County, Texas. Glenn Weigang was killed and Abel Pena was
seriously injured in the explosion. Jt. App. [#82] at 5.
Weigang's children filed a lawsuit against numerous
entities involved with the wellsite in the 79th District
Court of Jim Wells County, Texas. See Weigang v. South
Texas Oil Field Solutions, et al, Case No. 14-12-54-002
(Weigang Lawsuit). Pena intervened in the Weigang Lawsuit,
and the parties eventually reached an agreement to settle the
case. Liberty Mot. Summ. J [#81] at 3, 6. This lawsuit
relates to the rights and obligations of the different
insurance companies stemming from this incident.
Eagle Ford, LLC (SEA) and its parent company Sundance Energy,
Inc. (Sundance) hired various contractors to perform work at
the Peeler Ranch wellsite. SEA entered into a Master Services
Agreement with contractor Mesa Southern Well Servicing, LP
(Mesa) for Mesa to provide equipment and personnel at the
wellsite. See Jt. App. [#84] at 373-77 (Mesa MSA).
At the time of accident, Weigang and Pena were employed by
and working for Mesa. Jt. App. [#82] at 5. Sundance
separately contracted with contractor FESCO, Ltd. (FESCO) to
provide equipment and personnel at the wellsite. See
Jt. App. [#84] at 379-84 (FESCO MSA).
First Mercury both insured SEA and its parent company
Sundance. See Jt. App. [#82] at 103 (First
Mercury's Commercial Excess Liability Policy No.
TX-EX-0000030898-01); id. at 8, 55 (FIC's
General Liability Policy No. 3584-24-66 and FIC's
Commercial Excess and Umbrella Policy No. 7987-01-90). SEA
and Sundance were defendants in the Weigang Lawsuit. Jt. App.
[#82] at 5.
Sundance's contractors were also insured at the time of
the accident. Mesa was insured by Zurich American Insurance
Company (Zurich) and Axis. See Jt. App. [#83] at 226
(Zurich's Policy No. GLO 9296632-00); Jt. App. [#84] at
320 (Axis's Excess Liability Policy No. EAU718216/01/2013
to Finley Resources, Inc., Mesa's parent corporation).
Liberty insured contractor FESCO. See Jt. App. [#82]
at 126 (Commercial General Liability Policy No.
Sundance, Mesa, and FESCO were all defendants in the Weigang
Lawsuit. Liberty tendered FESCO's defense to Sundance,
who in turn tendered its own defense and FESCO's defense
to SEA's contractor Mesa. Compl. [#1] at 4. The insurers
paid to settle the Weigang Lawsuit. As Mesa's insurers,
Zurich paid its policy limit of $1 million and Axis paid $10
million of its $25 million policy limit. Jt. App. [#82] at
5-6. Mutual, FIC, First Mercury, and Liberty each paid their
respective policy limits. Id.
filed this lawsuit seeking a declaratory judgment regarding
its duty to defend and indemnify in the Weigang Lawsuit.
See Compl. [#1]. After this case commenced,
FESCO's other insurer, Commerce and Industry Insurance
Company (CIIC), intervened seeking a declaratory judgment
regarding the scope and obligations of the various insurers.
See CIIC Intervention Compl. [#2]. SEA and
Sundance's insurer, First Mercury, also intervened
claiming breach of contract against its fellow insurers.
See First Mercury Intervention Compl. [#54].
parties have filed numerous claims and counterclaims against
each other regarding the rights and obligations arising from
the explosion at the Peeler Ranch wellsite. By agreement of
the parties, the Court issued a bifurcated scheduling order
in this case. See Order of April 27, 2017 [#68]. The
first phase relates to claims against Axis, and second phase
relates to claims against CIIC and FESCO. Id. at 2.
The parties have filed summary judgment motions related to
claims against Axis pursuant to the Court's order. These
motions are fully briefed and ripe for consideration.
Legal Standard-Summary Judgment
judgment shall be rendered when the pleadings, the discovery
and disclosure materials on file, and any affidavits show
that there is no genuine dispute as to any material fact and
that the moving party is entitled to judgment as a matter of
law. Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett,
477 U.S. 317, 323-25 (1986); Washburn v. Harvey, 504
F.3d 505, 508 (5th Cir. 2007). A dispute regarding a material
fact is "genuine" if the evidence is such that a
reasonable jury could return a verdict in favor of the
nonmoving party. Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 248 (1986). When ruling on a motion for summary
judgment, the court is required to view all inferences drawn
from the factual record in the light most favorable to the
nonmoving party. Matsushita Elec. Indus. Co. v. Zenith
Radio, 475 U.S. 574, 587 (1986); Washburn, 504
F.3d at 508. Further, a court "may not make credibility
determinations or weigh the evidence" in ruling on a
motion for summary judgment. Reeves v. Sanderson Plumbing
Prods., Inc., 530 U.S. 133, 150 (2000);
Anderson, 477 U.S. at 254-55.
the moving party has made an initial showing that there is no
evidence to support the nonmoving party's case, the party
opposing the motion must come forward with competent summary
judgment evidence of the existence of a genuine fact issue.
Matsushita, 475 U.S. at 586. Mere conclusory
allegations are not competent summary judgment evidence, and
thus are insufficient to defeat a motion for summary
judgment. Turner v. Baylor Richardson Med. Ctr., 476
F.3d 337, 343 (5th Cir. 2007). Unsubstantiated assertions,
improbable inferences, and unsupported speculation are not
competent summary judgment evidence. Id. The party
opposing summary judgment is required to identify specific
evidence in the record and to articulate the precise manner
in which that evidence supports his claim. Adams v.
Travelers Indent. Co. of Conn., 465 F.3d 156, 164 (5 th
Cir. 2006). Rule 56 does not impose a duty on the court to
"sift through the record in search of evidence" to
support the nonmovant's opposition to the motion for
summary judgment. Id.
disputes over facts that might affect the outcome of the suit
under the governing laws will properly preclude the entry of
summary judgment." Anderson, 477 U.S. at 248.
Disputed fact issues that are "irrelevant and
unnecessary" will not be considered by a court in ruling
on a summary judgment motion. Id. If the nonmoving
party fails to make a showing sufficient to establish the
existence of an element essential to its case and on which ...