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Northwinds Abatement, Inc. v. Employers Insurance of Wausau

A servicing company is not an agent of the Texas Workers' Compensation Insurance facility, and is not protected by Texas Insurance Code Article 5.76-2 '2.12

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As amended July 27, 2001

Appeal from the United States District Court for the Southern District of Texas

In the second appearance of this case before us on appeal, Employers Insurance of Wausau (“Wausau”) appeals a jury verdict in favor of Northwinds Abatement, Inc. (“Northwinds”) and the resulting judgment of nearly $1.1 million, including actual and treble damages, attorney’s fees, interest and costs. Wausau asserts that, as a servicing company, it was an agent of the Texas Workers’ Compensation Insurance Facility (the “Facility”) and therefore exempt from liability claims pursuant to now-superseded Article 5.76-2, § 2.12 of the Texas Insurance Code. We disagree, and affirm the district court’s holding that Wausau is not an agent of the Facility. Wausau also argues that the claims underlying the jury verdict are all invalid as a matter of law. Wausau is in part correct, but under Texas law both the Texas Deceptive Trade Practices Act (“DTPA”) and Insurance Code claims are viable, and we must affirm the judgment on these extra-contractual claims. Finally, although the award of statutory attorneys’ fees to Northwinds is high, it is not reversible. The judgment is AFFIRMED.

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