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Click here for the full text of this decision FACTS:Sonat Exploration Co., the owner of several gas wells in Louisiana, entered into a master service agreement (MSA) with Cudd Pressure Control Inc. The agreement provided that Cudd would conduct snubbing operations, which involved forcing pipe into Sonat’s high-pressure wells during well-servicing procedures. The MSA provided that Cudd and Sonat would defend and indemnify each other for any claims brought by their respective employees. It also contained language that Sonat contends, in a separate suit, required Cudd to provide insurance coverage to Sonat. Lumbermens Mutual Casualty Co. was Cudd’s excess-liability insurer at the time the parties entered into the MSA. In 1998, an explosion occurred during snubbing operations at the Otto Cummings No. 2-Alt. well in Louisiana. The explosion killed seven people, including four Cudd employees, and severely injured three others. When Cudd’s employees and their families brought wrongful-death and personal-injury suits in Texas against Cudd and Sonat, Cudd refused to indemnify Sonat and Lumbermens did not provide coverage to Sonat. As a result, Sonat filed a cross-claim against Cudd for indemnity, which was severed from the personal-injury suit and constitutes the underlying proceeding here. Sonat also filed a separate breach-of-contract action against Lumbermens and Cudd, claiming that it was an additional insured under Cudd’s policy and, alternatively, that Cudd had breached a contractual obligation to procure insurance covering Sonat. Sonat eventually settled the personal-injury suits, and the underlying indemnity action proceeded. One of the issues presented was whether Texas or Louisiana law applied to the indemnity claim. The parties contended the issue was potentially dispositive because under Louisiana statutory law the MSA’s indemnity provision was void, while under Texas law it was valid. The trial court granted partial summary judgment in Sonat’s favor, holding that Texas law applied and Sonat was entitled to indemnity for the damages it had paid to settle the Cudd employees’ suits. The case went to trial on damages only, and the jury returned a $20.7 million verdict in Sonat’s favor upon which the trial court rendered judgment. Cudd filed a notice of appeal from the trial court’s judgment and from “all other ruling[s], orders and judgments rendered against Cudd in this matter.” Lumbermens posted the $29 million appellate security, and Sonat has not offered to release Lumbermens from that obligation. After Cudd perfected its appeal in the indemnity case underlying this mandamus proceeding, Cudd and Sonat entered into a Rule 11 Agreement in the breach-of-contract suit pursuant to which Cudd agreed to forgo any further challenge to the trial court’s choice-of-law ruling, and Sonat agreed to nonsuit its pending breach-of-contract claim against Cudd. Two days later, Cudd filed its appellate brief in the indemnity appeal, which did not raise the choice-of-law issue. Sonat then filed a motion to dismiss with prejudice its breach-of-contract claim pursuant to the Rule 11 Agreement, which the trial court granted. Ten weeks after Cudd filed its appellate brief, Lumbermens sought leave to intervene in the court of appeals in order to preserve the choice-of-law issue. The court of appeals denied Lumbermens’ motion, and the appeal remains pending in that court. HOLDING:Conditionally granted. That Lumbermens’ interest in pursuing the choice-of-law issue had diverged from Cudd’s by the time Lumbermens filed its intervention motion does not defeat Lumbermens’ ability to participate in the appeal pursuant to the virtual-representation doctrine. Irrespective of any potential coverage dispute between Lumbermens and Cudd, Lumbermens has pledged $29 million to secure the judgment in Sonat’s favor. Even if Lumbermens could eventually recoup the amount it has pledged through a potential coverage suit against Cudd, its obligation to pay the underlying judgment to Sonat is immediate and binding in the event Cudd’s appeal is unsuccessful. In this case, neither the fact that Cudd’s and Lumbermens’ interests in pursuing appeal of the choice-of-law issue have diverged, nor the possibility that Lumbermens could later assert a noncooperation defense against Cudd, prevent Lumbermens from invoking the virtual-representation doctrine. Because virtual representation is an equitable doctrine, other factors may weigh against allowing intervention after final judgment has been rendered. While other equitable factors may weigh against allowing a virtually-represented party to invoke appellate rights, the mere fact that the party does not attempt to invoke those rights until after judgment, when the need to invoke them arose, is not dispositive. In light of the novel posture of this case, the extent of likely prejudice to Lumbermens if it is not allowed to raise the choice-of-law issue its insured abandoned, and the unlikelihood of prejudice to Sonat resulting from the timing of Lumbermens’ effort to invoke appellate rights, the court concludes that the timing of Lumbermens’ motion does not prevent its intervention. The court reiterates that whether a would-be intervenor is entitled to appeal under the virtual-representation doctrine is an equitable determination that must be decided on a case-by-case basis. OPINION:O’Neill, J., delivered the court’s opinion.

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