Jan Rogers Freeman, Individually and as Representative of the Estate of Michael Neal Freeman Jennifer Paige Scoggins Laurie Lynn Caves And Ashley Michelle Kirkland v. JI Specialty Services, Inc., York Risk Services Group, Inc., and Diana Maldonado, 505 S.W.3d 14

Background

Michael Neal Freeman, a Harrison County deputy, suffered severe neck injuries in 2007 and later became ventilator-dependent; clinicians requested a specialized bed in 2012.
Harrison County belonged to a Risk Management Pool; JI Specialty Services (third-party administrator) and York Risk Services adjusted Freeman’s workers’ compensation claims.
Appellants (Freeman’s widow and family) sued JI Specialty Services, York Risk Services, and an adjuster for wrongful death, survival, and gross-negligence-based exemplary damages, alleging denial/refusal to authorize the specialized bed and other benefits.
Defendants moved to dismiss for lack of subject-matter jurisdiction, arguing the Texas Workers’ Compensation Act (the Act) gives the Division exclusive jurisdiction and plaintiffs failed to exhaust administrative remedies.
Trial court granted dismissal; appellants appealed. The court below affirmed, holding plaintiffs’ claims arise from the handling of workers’ compensation benefits and plaintiffs did not allege exhaustion of administrative remedies.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Act’s exclusive-remedy bars claims against insurers/TPAs	Appellants: §408.001(b) provides an exception for recovery of exemplary damages for grossly negligent/intentional acts causing death, so court suit is permitted	Appellees: §408.001(b) applies only to employers; claims against adjusters/TPAs arise from claim handling and fall under the Act’s exclusive remedy	Held: §408.001(b) does not apply to insurers/TPAs here; claims fall within §408.001(a) exclusive remedy
Whether plaintiffs sufficiently alleged exhaustion of administrative remedies	Appellants: they attempted repeatedly and received no response; defendants’ payment of death benefits exhausted remedies	Appellees: plaintiffs never alleged pursuing Division procedures or filing appeals; tendering death benefits does not substitute for administrative exhaustion	Held: Plaintiffs did not plead administrative exhaustion; failure to exhaust deprives trial court of jurisdiction
Whether any common-law or statutory tort claims survive outside the Act’s process (post-Crawford)	Appellants: Crawford allows some court actions for independent injuries and exemplary damages; plaintiffs contend their claims qualify	Appellees: Crawford and Ruttiger limit exceptions; most claims arising from claim handling are for the Division	Held: Crawford and Ruttiger confine exceptions narrowly; these claims arise from claim handling and must proceed administratively
Res judicata argument	Appellants: N/A (they appealed dismissal)	Appellees: earlier dismissal in prior suit bars relitigation	Held: Court declined to address res judicata because dismissal for lack of jurisdiction was dispositive

Key Cases Cited

In re Crawford & Co., 458 S.W.3d 920 (Tex. 2015) (holds Division has exclusive jurisdiction over claims arising from carrier’s handling of workers’ compensation claims and limits judicial causes of action)
Tex. Mut. Ins. Co. v. Ruttiger, 381 S.W.3d 430 (Tex. 2012) (explains Act’s comprehensive administrative scheme removes many statutory and common-law claims arising from claim handling)
Rodriguez v. Naylor Indus., Inc., 763 S.W.2d 411 (Tex. 1989) (recognizes a spouse’s loss-of-consortium claim may survive where employer’s intentional tort caused the injury)
American Motorists Ins. Co. v. Fodge, 63 S.W.3d 801 (Tex. 2001) (articulates that the Act vests compensation award power exclusively in the Commission)
Macias v. Schwedler, 135 S.W.3d 826 (Tex. App.—Houston [1st Dist.] 2004) (affirms dismissal where plaintiff’s tort/statutory claims were grounded in alleged wrongful denial of workers’ compensation benefits and administrative remedies were not exhausted)