Opinion ID: 4149915
Heading Depth: 1
Heading Rank: 1

Heading: Origins of the insurance coverage dispute

Text: This appeal is rooted in Raylin Richard’s personal injury lawsuit against Anadarko, Dolphin Drilling Ltd. (“Dolphin Drilling”), and Smith International We follow the parties and district court in referring to this as a “knock for knock” 1 indemnity arrangement. 2 Case: 16-30216 Document: 00513895499 Page: 3 Date Filed: 03/02/2017 No. 16-30216 Inc. (“Smith International”). Richard worked as a casing supervisor for OES. Anadarko and OES had a longstanding master services contract (the “MSC”), under which OES provided casing and other services on Anadarko projects. One such project brought Richard onto a drill ship called the Belford Dolphin, where, in June 2009, he suffered an injury. Richard filed tort claims against Anadarko and other companies working on Anadarko’s project, including Dolphin Drilling and Smith International. OES, as Richard’s employer, ultimately shouldered the financial burden of defending against Richard’s claims and secured a full release by paying a $2.5 million settlement. OES assumed this burden pursuant to a two-part chain of contractual indemnifications. First, Anadarko’s contractors, Dolphin Drilling and Smith International, turned to Anadarko for indemnification. Second, Anadarko, in turn, sought indemnity from OES for its own exposure, as well as Dolphin Drilling and Smith International’s. The MSC, which established the general terms under which OES and Anadarko would conduct business within a number of different projects, contains provisions imposing reciprocal indemnity obligations for claims relating to employees’ work-related accidents. The parties vigorously dispute the scope of these indemnity obligations. The dispute concerns paragraphs 14(a)–(b), which obligate OES and Anadarko to indemnify each other’s “indemnitees,” and paragraphs 2(c)–(d), which define the relevant “indemnitees” as “[Anadarko or OES, respectively,] its Affiliates, its joint owners and venturers, if any, and its and their directors, agents, representatives, employees and insurers and its subcontractors and their employees.” Liberty Mutual, OES’s insurer, denied coverage for OES’s expenditures related to Dolphin Drilling and Smith International. 3 Case: 16-30216 Document: 00513895499 Page: 4 Date Filed: 03/02/2017 No. 16-30216