StarPak Corp v. Commerce & Industry Insurance Company, 4:11-cv-03572

StarPak is a non-subscriber to the Texas Workers’ Compensation Act and carries CIIC employer’s liability insurance.
Endorsement No. 22 excludes coverage for any loss that would be payable under the Texas WCA but for StarPak’s opt-out.
Mendoza and Workman, StarPak employees, were injured in 2010 and have arbitration claims against StarPak seeking damages.
StarPak sought coverage for these claims under the Policy; CIIC denied coverage relying on Endorsement No. 22.
This declaratory-judgment action addressed whether underlying arbitration pleadings are covered by the Policy.
The court granted in part and denied in part the Restated Motion for Summary Judgment on the coverage issue.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Is Endorsement No. 22 unambiguous?	StarPak argues ambiguity exists between loss types and WCA coverage.	CIIC contends Endorsement No. 22 clearly excludes losses payable under WCA for opt-out.	Endorsement No. 22 is unambiguous.
Does Endorsement No. 22 exclude losses payable under the WCA, such as lost wages?	Losses would be payable under WCA and thus excluded.	Exclusion applies to any loss payable under WCA, regardless of action pleadings.	Yes; losses like lost wages would be payable under WCA and are excluded.
Are losses not payable under the WCA, such as pain and mental anguish, covered?	Those losses may be recoverable under non-WCA theories and could be covered.	Endorsement No. 22 excludes only WCA-payable losses; non-WCA losses may be covered.	Yes; pain, disfigurement, and mental anguish are covered.
What is the overall effect of Endorsement No. 22 on the underlying arbitrations?	Portions of the underlying claims fall outside the exclusion and are covered.	A substantial portion falls within the exclusion and is not covered.	Coverage denied for WCA-payable losses; coverage granted for non-WCA losses; motion granted in part and denied in part.

OneBeacon Ins. Co. v. Crowley Marine Servs., 648 F.3d 258 (5th Cir. 2011) (contract interpretation to ascertain parties' intention)
Mid-Continent Cas. Co. v. Swift Energy Co., 206 F.3d 487 (5th Cir. 2000) (contract interpretation framework)
Barnett v. Aetna Life Ins. Co., 723 S.W.2d 663 (Tex. 1987) (undetermined ambiguity standard)
Am. Nat’l Gen. Ins. Co. v. Ryan, 274 F.3d 319 (5th Cir. 2001) (interpretation to give effect to policy language)
Int’l Ins. Co. v. RSR Corp., 426 F.3d 281 (5th Cir. 2005) (ambiguity determination as a question of law)
Kern v. Sitel Corp., 517 F.3d 306 (5th Cir. 2008) (ambiguity requires more than one reasonable interpretation)
Saldana v. Houston Gen. Ins. Co., 610 S.W.2d 807 (Tex. App. – Houston [1st Dist.] 1980) (pain is not a compensable injury under WCA)