# United States Court **of Appeals**  **f or the Fifth Circuit** 

No. 21

- 30543

**John Thibodeaux; Amy Thibodeaux; Gabrielle Thibodeaux; Emily Thibodeaux,** 

Plaintiffs

— Appellees **,**

versus

**J M Drilling, L.L.C.; Insight Risk Management, L.L.C.; C**  **R C Insurance Services, Incorporated,**  incorrectly named as **Insurisk Excess & Supply Lines**  **,** Defendants

— Appellees **,**

versus

**Rockhill Insurance Company,**

Defendant

— Appellant **,**

**______________________________ Rockhill Insurance Company,** 

Plaintiff

— Appellant **,**

versus

**J M Drilling, L.L.C.,**

Defendant

— Appellee **,** United States Court of Appeals Fifth Circuit 

### FILED August 8, 2022
Lyle W. Cayce Clerk Case: 21-30543 Document: 00516423296 Page: 1 Date Filed: 08/08/2022No. 21

- 30543

2 **Insight Risk Manage ment, L.L.C.; C R C Insurance**  **Services, Incorporated,**

Third Party Defendants

— Appellees

**.**

Appeal from the United States District Court for the Western District of Louisiana USDC 6:18

- CV

- 501

Before **Jolly, Elrod,** and **Haynes,** Circuit Judges

**. Per Curiam**  **:** *
While installing fiber optic cables in Louisiana, JM Drilling hit an underground sewer line. It did not notify anyone of this fact or seek any repairs. Thereafter, a three

- foot sink hol e was formed. Without having received any warning, John Thibodeaux fell into it and suffered a severe injury as to which he recovered a jury verdict against JM Drilling in state

court. This case concerns certain insurance coverage for JM Drilling. The district court found coverage; we **AFFIRM**

. 1

* Pursuant to **5th Cir cuit**  **R ule**  47.5, the court has determined t hat this opinion should not be published and is not precedent except under the limited circumstances set forth in **5th Cir cuit**  **R ule**  47.5.4.

1 The parties were asked on appeal to brief the question of federal court jurisdiction because the complaint failed to address the members of JM Drilling , which is a limited liability company

. See Harvey v. Grey Wolf Drilling Co. , 542 F.3d 1077, 10 80 (5th Cir. 2008). The record confirms that the amount in controversy exceeds $75,000 and t hat complete diversity exist s, given the citizenship of the owner of JM Drilling. Accordingly, we conclude that the district court had jurisdiction, and we proceed to the merits. See 28 U.S.C. § 1653. Case: 21-30543 Document: 00516423296 Page: 2 Date Filed: 08/08/2022No. 21

- 30543

3 Relevant to this case, JM Drilling had two insurance policies, a primary policy by Admiral Insurance Company , which is not at issue here, and an excess liability policy from Rockhill Insurance Company that is the center of this dispute. Rockhill’s insurance incorporated the limits and
exclusions of the Admiral Insurance Company policy but also added its own
excl usions, the key one of which was the “Subsidence Exclusion , ” which provides:
This policy will NOT apply :

. . . . to any liability, whether direct or indirect, arising out of, caused by, resulting from, contributed to, or aggravated by the subsidence, settl ing, expansion, sinking, slipping, falling away, tilting, caving in, shifting, eroding, mud flow, rising, or any other movement of land or earth if any of the foregoing emanate from the operations of the insured or any other person for whose acts the insur ed is legally liable.
It is further agreed that this insurance shall not become excess of any reduced or exhausted underlying aggregate limit to the extent that such reduction or exhaustion is the result of claims, damage, loss or expense arising out of or in any way related to the above.

Rockhill contends that this exclusion covers the sinkhole , which, in its view, was a subsidence. The parties agree that Tennessee law applies here. Tennessee has a somewhat different version of concurrent cause analysis
than some other states

. Compare Allstate Ins

. Co. v. Watts , 811 S.W.2d 883 , 887

– 88 (Tenn. 1991) , with Seahawk Liquidating Tr. v. Certain Underwriters , 810 F.3d 986, 994

– 95 (5th Cir. 2016) (applying Texas law) . To sum up, “where a nonexcluded cause is a substantial factor in p roducing the damage or injury, even though an excluded cause may have contributed in some form to the ultimate result and, standing alone, would have properly invoked the exclusion contained in the policy.” Watts , 811 S.W.2d at 887 ; see Clark v. Case: 21-30543 Document: 00516423296 Page: 3 Date Filed: 08/08/2022No. 21

- 30543

4 Sputniks, LLC , 368 S.W.3d 431 , 441 (Tenn. 2012) ; Capitol Indem. Corp. v.
Braxton , 24 F. App’x 434 , 440 (6th Cir. 2001). 2
It is undisputed that subsidence would be an excluded cause under the Rockhill Policy. But whether JM Drilling’s negligence is a nonexcluded cause is disputed. A nonexcluded cause is a cause that is otherwise covered by the policy and is not specifically listed in the exclusion. Here, the Rockhill Policy covers “the ultimate net loss in excess of the amount payable under
the terms of any Underlying Insurance

. . . that the insured becomes legally obligated to pay as damages.” There is no dispute that th e general policy coverage applies here, but Rockhill contends the only cause of injury to Thibodeaux was subsidence such that the exclusion applies.
We agree that Rockhill makes a good argument that negligence that causes the sinkhole is part of the exclu sion, but we disagree that the case ends there. Instead, we note that the parties also assert that the failure to report the damage was part of the negligence but did not cause the sinkhole. Rather , it contributed to the injury because if it had been rep orted, maybe it would have been fixed or, at least, there would have been some warning that would have avoided Thibodeaux working there. Per Watts , the mere relationship to the excluded conduct is not enough to cause everything to be excluded. 811
S.W. 2d at 884

– 8 8 . Thus, given that there is a mix of excluded and nonexcluded causation, we conclude that the district court did not err in finding coverage under the Rockhill policy.

**AFFIRMED.**

2 Under Tennessee law, an insurer can avoid the effec t of the “concurrent cause” doctrine by expressly including an anti

- concurrent clause ( “ ACC ” ) in the policy. See Hardy & Kelly LLC v. QBE Ins. Corp. , No. 3

- 11

- 0155, 2012 WL 1744670, at *3 (M.D. Tenn. May 16, 2012). While Rockhill did that on other exclus ions, it did not on this one, so we agree with the district court that the ACC is not in play here. Case: 21-30543 Document: 00516423296 Page: 4 Date Filed: 08/08/2022