United States Court of Appeals

for the Fifth Circuit

No. 22-50432

Summary Calendar

Finger Oil & Gas, Incorporated, 

Plaintiff—Appellant, 

versus

Mid-Continent Casualty Company,

Defendant—Appellee. 

Appeal from the United States District Court 

for the Western District of Texas

USDC No. 5:20-CV-712

Before Stewart, Duncan, and Wilson, Circuit Judges.

Per Curiam:*

This appeal arises out of an insurance coverage dispute between 

Finger Oil & Gas, Inc. (“Finger Oil”), the insured, and Mid-Continent 

Casualty Company (“Mid-Continent”), the insurance provider. The 

magistrate judge granted Mid-Continent’s motion for summary judgment, 

and Finger Oil appeals the magistrate judge’s dismissal of its 

* This opinion is not designated for publication. See 5th Cir. R. 47.5. 

United States Court of Appeals

Fifth Circuit

FILED

January 27, 2023

Lyle W. Cayce

Clerk

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misrepresentation and breach of contract claims. For the following reasons,

we AFFIRM. 

I. Facts & Procedural History

Finger Oil is an insured under a policy issued by Mid-Continent, 

which provides general liability insurance. On July 19, 2019, Finger Oil was 

drilling at its own natural gas well, named Drushel #1, located in Jackson 

County, Texas when a valve failed and the well blew out. In response, Finger 

Oil contacted Desiree Scrimger, the commercial-lines account manager at 

Marsh USA, Inc. (“Marsh”), Finger Oil’s insurance agent, to inquire 

whether it was covered for the blow out. Because Scrimger was unfamiliar 

with the policy, she reached out to an underwriter at Mid-Continent 

requesting that it “confirm that this insured has Blow Out and Cratering 

coverage and advise the limit.” Mid-Continent’s underwriter replied in an 

email stating:

The policy ML1419 Oil & Gas Endorsement IV Blow-Out and 

Cratering has a box to X if the coverage is excluded. The 

ML1419 for this policy is not X’d. The limit for Blow Out and 

Cratering is included within the CG0001 Commercial General 

Liability Form, Section III Limits of Insurance. 

Based on this response, Scrimger emailed Finger Oil as follows:

Per the underwriter regarding coverage, the Blowout and 

Cratering are included within the limit of insurance. Limits are 

$1M occurrence/$2M aggregate. Please note that each claim is 

based on its own merit and this is just verifying the coverage in 

place. 

Thereafter, a claims specialist at Mid-Continent informed Finger Oil that it

would be reviewing the policy regarding coverage for the incident. 

Nevertheless, before the claim was approved, Finger Oil, relying on

Scrimger’s email as confirmation that it was covered for the incident, hired 

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several contractors to work on the well and incurred bills for these services in 

the amount of $641,590.90. 

Mid-Continent subsequently denied Finger Oil’s insurance claim, 

which was for expenses incurred while repairing property from the well blow 

out and the costs to bring the well under control. Mid-Continent determined 

that there was no coverage under the policy for these damages based on two 

exclusions. First, Mid-Continent stated that the policy included an exclusion 

entitled “Damage to Property” in Section 1.2.j(1) (“Ownership Exclusion”) 

which excluded from coverage “property damage” to:

Property you own, rent, or occupy, including any costs or 

expenses by you, or any other person, organization or entity, 

for repair, replacement, enhancement, restoration or 

maintenance of such property for any reason, including 

prevention of injury to a person or damage to another’s 

property. 

According to Mid-Continent, this exclusion “preclude[d] coverage of costs 

and expenses associated with the repair or replacement of a well structure 

that Finger Oil owns.” Second, it stated that the policy included

endorsement ML1419 (“Oil & Gas Endorsement”) which excluded from 

coverage:

Any loss, cost or expense incurred by you or at your request or 

by or at the request of any “Co-owner of the Working Interest” 

in connection with controlling or bringing under control any 

oil, gas, or water well. 

According to Mid-Continent, this endorsement “preclude[d] coverage for 

the costs and expenses submitted for controlling and bringing the well under 

control.” 

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Finger Oil filed suit against Mid-Continent in state court asserting 

several causes of action.

1 These claims included: (1) misrepresentation claims 

for violations of § 541.051 of the Texas Insurance Code and the Texas 

Deceptive Trade Practices Act (“DTPA”);2 (2) breach of contract claims; 

and (3) a claim that Mid-Continent failed to timely investigate the claim in 

violation of § 542.055 and § 542.056 of the Texas Insurance Code. The suit 

was removed to federal court and thereafter the parties consented to proceed 

before a magistrate judge who subsequently held a pretrial conference. After 

the conference, the magistrate judge directed Finger Oil to amend its state 

court petition to “clarify its factual allegations and conform with federal 

pleading requirements.” Finger Oil did not file an amended complaint as 

directed. 

Mid-Continent then filed a motion for summary judgment, which the 

magistrate judge granted in part. It dismissed all of Finger Oil’s claims, 

except the breach of contract claim to the extent it involved Mid-Continent’s 

failure to pay costs and expenses for repair of the well. Both Mid-Continent 

and Finger Oil filed motions for reconsideration. After conducting a hearing 

and allowing the parties to file supplemental briefing, the magistrate judge

granted Mid-Continent’s motion for reconsideration and denied Finger Oil’s 

motion for reconsideration. In doing so, it reversed its decision to deny 

summary judgment on the remaining breach of contract claim for repairing 

the well. It held that after further review of the policy and hearing the parties’

arguments, it was clear that Finger Oil was not entitled to recover costs and 

1 Finger Oil also brought suit against Marsh and the underwriter at Marsh for 

misrepresentation. The underwriter at Marsh was dismissed as improperly joined and 

Marsh is not a party to this appeal. 

2 The DTPA claim for “false, misleading, or deceptive acts” arises 

under § 17.46(b) of the Texas Business and Commerce Code. Tex. Bus. & Com. Code

§ 17.46(b).

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expenses for repairing the well because it owned the well in question, and the 

policy only provided third-party liability coverage, not first-party liability 

coverage. Finger Oil then appealed the magistrate judge’s dismissal of its 

misrepresentation and breach of contract claims. 

II. Standard of Review

“In this diversity case, we review the district court’s grant of 

summary judgment de novo, applying Texas law.” Certain Underwriters at 

Lloyd’s of London v. Lowen Valley View, L.L.C., 892 F.3d 167, 170 (5th Cir. 

2018). “The court shall grant summary judgment if the movant shows that 

there is no genuine dispute as to any material fact and the movant is entitled 

to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “All reasonable 

inferences must be viewed in the light most favorable to the party opposing 

summary judgment, and any doubt must be resolved in favor of the nonmoving party.” In re La.Crawfish Producers, 852 F.3d 456, 462 (5th Cir. 2017)

(citations omitted).

III. Discussion

We turn first to the magistrate judge’s dismissal of Finger Oil’s 

misrepresentation claims, which arise under the DTPA and the Insurance 

Code. Finger Oil argues that Mid-Continent negligently misrepresented that 

its policy provided coverage for blowout and cratering when it knew, but did 

not disclose, that there were exclusions that applied to the coverage. “The 

general rule is that in the absence of an affirmative misrepresentation, a 

mistaken belief about the scope of coverage is not actionable under the DTPA 

or the Insurance Code.” Manion v. Sec. Nat. Ins. Co., 2002 WL 34230861, at 

*2 (Tex. App. Aug 15, 2002, no pet.) (citing Sledge v. Mullin, 927 S.W.2d 89, 

94 (Tex. App.—Fort Worth 1996, no writ)). However, when “an insurer or 

agent does more than represent that a policy provides full coverage—such as 

representing that coverage exists in a specific situation—the insurer or agent 

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may be liable for a misrepresentation under the DTPA.” Wyly v. Integrity Ins. 

Sols., 502 S.W.3d 901, 908 (Tex. App. 2016, no pet.) (upholding

misrepresentation claim where insurer told insured that policy provided 

coverage from “loading to unloading” and that the insured would be covered 

under several scenarios posed by the insured).

We agree with the magistrate judge’s conclusion that MidContinent’s statement does not amount to an actionable misrepresentation 

under the circumstances presented here.3 Finger Oil’s agent asked MidContinent whether it had blow out and cratering coverage, to which MidContinent correctly replied that it did. Mid-Continent’s statement was more 

akin to a general statement that the policy included such coverage, rather 

than it was to a misrepresentation of specific policy terms. Indeed, Finger Oil 

was warned in the same email to “[p]lease note that each claim is based on 

its own merit and” that the statement was “just verifying the coverage in 

place.” Hence, Finger Oil was not “led wrongly to believe that [its] policy 

provided protection against a particular risk that was in fact excluded from 

the policy’s coverage.” May v. United Servs. Ass’n of Am., 844 S.W.3d 666, 

669-70 (Tex. 1992). The summary judgment evidence therefore does not 

support Finger Oil’s misrepresentation claims.

Finger Oil also challenges the dismissal of its breach of contract 

claims, arguing that the policy covered costs and expenses incurred for (1) 

repairing property from the well blow out and (2) the costs to bring the well 

under control. We disagree. 

3 The magistrate judge also dismissed the misrepresentation claims based on Finger 

Oil’s failure to amend its complaint to plead the “fraud-type allegations” with sufficient 

particularity to comply with the heightened pleading standard of Federal Rules of Civil 

Procedure 9(b) as directed. See Fed. R. Civ. P. 16(f) and 14(b). 

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“In Texas, insurance policies are contracts subject to the rules of 

contract construction.” Certain Underwriters at Lloyd’s of London, 892 F.3d 

at 170 (citing Mid–Continent Cas. Co. v. Swift Energy Co., 206 F.3d 487, 491 

(5th Cir. 2000)). As with other contracts, courts “interpret and enforce them 

according to settled rules of construction” and “must give the policy’s words 

their plain meaning, without inserting additional provisions into the 

contract.” Nat’l Union Fire Ins. Co. of Pittsburgh v. Crocker, 246 S.W.3d 603, 

606 (Tex. 2008). Accordingly, courts must begin their analysis with the 

terms of the policy because they “presume parties intend what the words of 

their contract say.” Gilbert Tex. Constr., L.P. v. Underwriters at Lloyd’s 

London, 327 S.W.3d 118, 126 (Tex. 2010). The words of the policy “are given 

their ordinary and generally-accepted meaning unless the policy shows the 

words were meant in a technical or different sense.” Id.

The insured has the burden of establishing coverage under the 

policy. Id. at 124. If the insured establishes coverage, the burden shifts to the 

insurer to then prove the loss is within an exclusion. Id. If the insurer 

establishes that an exclusion applies, the burden shifts back to the insured to 

show that an exception to the exclusion brings the claim within coverage. Id. 

Applying this standard, we hold that the magistrate judge did not err in 

dismissing Finger Oil’s breach of contract claims. 

Recovering costs and expenses for the repair of Finger Oil’s well is 

expressly excluded from the policy. As noted, the policy contains an 

Ownership Exclusion preventing coverage of “property damage” 

to “property [Finger Oil] own[s] . . . including any costs or expenses incurred 

by [it] . . . for repair, replacement, enhancement, restoration, or maintenance 

of such property for any reason.” As recognized by the magistrate judge, this 

exclusion underscores that the policy only provides third-party liability 

coverage—i.e., coverage for property not owned or controlled by Finger Oil. 

See Eagle Water, L.L.C. v. Ash, 778 F. App’x 304, 305 n.1 (5th Cir. 2019) (per 

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curiam) (“The purpose of owned property exclusions in general liability 

policies is to effectuate the intent that liability insurance is designed to 

provide compensation for damages to property not owned or controlled by 

the insured. It does not provide first party coverage for losses sustained by 

the insured on its own property.” (quotation omitted)). Finger Oil provides 

no basis for the court to question the clear terms of this exclusion, nor does it 

dispute that it owned the well in question.

Rather, Finger Oil argues that this case is akin to Mid-Continent 

Casualty Company v. Bay Rock Operating Company, 14 F.3d 105 (5th Cir. 

2010), a case in which this court rejected the insurer’s argument that an oil 

and gas endorsement with identical language precluded coverage for repair 

costs. Bay Rock, however, is readily distinguishable. That case, unlike this 

one, involved damages to a well that the insured did not own. Whereas here 

Finger Oil is seeking reimbursement for damages to its own property. 

Accordingly, Bay Rock is not applicable here, and Finger Oil’s repair costs are

not covered by the policy.

Likewise, Finger Oil’s costs for bringing the well under control are not 

covered. Recall that the Oil and Gas Endorsement includes coverage for “the 

Blow Out and Cratering of any well” with the exclusion of “[a]ny loss, costs, 

or expense . . . in connection with controlling or bringing under control any 

oil, gas, or water well.” This provision unambiguously excludes coverage of 

expenses connected to controlling or bringing under control Finger Oil’s 

well. See Tristar Expl., Inc. v. Mid-Continent Cas. Co., 2007 WL 1816894, at 

*2 (Tex. App. June 26, 2007) (holding no breach of contract under similar 

policy language stating that coverage was “limited by the well control 

exclusion clause, meaning those expenses connected to controlling or 

bringing under control any gas, oil, or water well are excluded.”). Finger Oil 

again provides no basis for this court to interpret this exclusion in its favor. 

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The magistrate judge, therefore, did not err in holding that Finger Oil’s 

expenses for bringing the well under control were not covered by the policy. 

IV. Conclusion

For the aforementioned reasons, we AFFIRM.

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