Court Opinion

ID: 854262
Source: CourtListenerOpinion
Date Created: 2013-03-05 01:00:25.395189+00
Date Added: 2024-06-11T12:02:34.000597
License: Public Domain

Case: 12-30230          Document: 00512161598         Page: 1   Date Filed: 03/01/2013

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                    Fifth Circuit

                                                                             FILED
                                                                            March 1, 2013

                                             No. 12-30230                   Lyle W. Cayce
                                                                                 Clerk

IN RE: DEEPWATER HORIZON

--------------------------------------------------

RANGER INSURANCE, LIMITED,

                                                     Plaintiff - Appellee
v.

TRANSOCEAN OFFSHORE DEEPWATER DRILLING, INCORPORATED;
TRANSOCEAN HOLDINGS, L.L.C.; TRANSOCEAN DEEPWATER,
INCORPORATED; TRITON ASSET LEASING GMBH,

                                                     Intervenor Plaintiffs - Appellees
v.

BP P.L.C.; BP EXPLORATION & PRODUCTION, INCORPORATED; BP
AMERICAN PRODUCTION COMPANY; BP CORPORATION NORTH
AMERICA, INCORPORATED; BP COMPANY NORTH AMERICA,
INCORPORATED; BP PRODUCTS NORTH AMERICA, INCORPORATED;
BP AMERICA, INCORPORATED; BP HOLDINGS NORTH AMERICA,
LIMITED,

                                 Defendants - Intervenor Defendants - Appellants

--------------------------------------------------

CERTAIN UNDERWRITERS AT LLOYD’S LONDON,

                                                     Plaintiff - Appellee
     Case: 12-30230    Document: 00512161598      Page: 2   Date Filed: 03/01/2013

                                  No. 12-30230

TRANSOCEAN OFFSHORE DEEPWATER DRILLING, INCORPORATED;
TRANSOCEAN HOLDINGS, L.L.C.; TRANSOCEAN DEEPWATER,
INCORPORATED; TRITON ASSET LEASING GMBH,

                                            Intervenor Plaintiffs - Appellees
v.

BP P.L.C.; BP EXPLORATION & PRODUCTION, INCORPORATED; BP
AMERICAN PRODUCTION COMPANY; BP CORPORATION NORTH
AMERICA, INCORPORATED; BP COMPANY NORTH AMERICA,
INCORPORATED; BP PRODUCTS NORTH AMERICA, INCORPORATED;
BP AMERICA, INCORPORATED; BP HOLDINGS NORTH AMERICA,
LIMITED,

                         Defendants - Intervenor Defendants - Appellants

                 Appeal from the United States District Court
                    for the Eastern District of Louisiana

Before JOLLY, BENAVIDES, and HIGGINSON, Circuit Judges.
E. GRADY JOLLY, Circuit Judge:
      This appeal presents only one of the many disputes that have arisen and
will arise from the explosion and sinking of Transocean’s Deepwater Horizon in
April 2010. Today we address the obligations of Transocean’s primary and
excess-liability insurers to cover BP’s pollution-related liabilities deriving from
the ensuing oil spill in the Gulf of Mexico. Applying Texas law, especially as
clarified since the district court’s decision, we find that the umbrella insurance
policy—not the indemnity provisions of Transocean’s and BP’s contract—controls
the extent to which BP is covered for its operations under the Drilling Contract.
Because we find this policy imposes no relevant limitations upon the extent to
which BP is covered, we REVERSE the judgment of the district court and

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                                       No. 12-30230

REMAND the case for entry of an appropriate judgment in accordance with this
opinion.
                                               I.
       Transocean Holdings, Inc. (“Transocean”) owned the Deepwater Horizon,
a semi-submersible, mobile offshore drilling unit. In April 2010, the Deepwater
Horizon sank into the Gulf of Mexico after burning for two days following an
onboard explosion (“Incident” or “Deepwater Horizon Incident”). At the time of
the Incident, the Deepwater Horizon was engaged in exploratory drilling
activities at the Macondo Well under a Drilling Contract between the Appellant
BP America Production Company’s (together with its affiliates, “BP”)
predecessor and Transocean’s predecessor. This Contract required Transocean
to maintain certain minimum insurance coverages for the benefit of BP. The
extent to which these policies covered BP’s pollution-related liabilities arising
from the Deepwater Horizon Incident is the subject of this appeal.
The Insurance Policies
       Transocean held insurance policies with a primary liability insurer,
Ranger Insurance Ltd. (“Ranger”), as well as several excess liability insurers led
by London market syndicates (“Excess Insurers;” together with Ranger,
“Insurers”). Transocean’s insurance policy with Ranger provided at least $50
million of general liability coverage, and its policies with the Excess Insurers
formed four layers of excess coverage directly above the Ranger Policy that
provided at least $700 million of additional general liability coverage. The
Ranger and Excess Policies contain materially identical provisions.1 The Policy
terms that are important to this case are “Insured” and “Insured Contract.” The
Policies define “Insured” as including the Named Insured, other parties, and

       1
        As the district court noted (and the Insurers have not disputed), this similarity allows
the court to treat all of the Insurers as one for purposes of analysis in this case.

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                                    No. 12-30230

             (c) any person or entity to whom the “Insured” is obliged by
             any oral or written “Insured Contract” (including contracts
             which are in agreement but have not been formally concluded
             in writing) entered into before any relevant “Occurrence”, to
             provide insurance such as is afforded by this Policy . . . .
The Policies define “Insured Contract” as follows:
             The words “Insured Contract”, whenever used in this Policy,
             shall mean any written or oral contract or agreement entered
             into by the “Insured” (including contracts which are in
             agreement but have not been formally concluded in writing)
             and pertaining to business under which the “Insured”
             assumes the tort liability of another party to pay for “Bodily
             Injury”, “Property Damage”, “Personal Injury” or “Advertising
             Injury” to a “Third Party” or organization. Tort Liability
             means a liability that would be imposed by law in the absence
             of any contract or agreement.2
The Drilling Contract
      The Drilling Contract defines BP’s and Transocean’s obligations to one
another, separately identifying the liabilities each party assumes. Article 20 of
the Contract is a singular provision that imposes upon Transocean an insurance
requirement:
             20.1 INSURANCE
             Without limiting the indemnity obligations or liabilities of
             CONTRACTOR [Transocean] or its insurer, at all times
             during the term of this CONTRACT, CONTRACTOR shall
             maintain insurance covering the operations to be
             performed under this CONTRACT as set forth in
             Exhibit C.
(Emphasis added.) Exhibit C to the Drilling Contract is titled “Insurance
Requirements” and establishes the types and minimum level of coverage that

      2
        The Policies contain further provisions addressing other insureds. Endorsement 1
provides a general condition that additional insureds are automatically included where
required by written contract. Condition D.1 to Section I coverage limits the coverage of
additional insureds: Transocean has the privilege to name additional insureds only to the
extent as is required under contract or agreement.

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Transocean is obligated to maintain. This Exhibit provides that Transocean
shall carry all insurance at its own expense and that the policies “shall be
endorsed to provide that there will be no recourse against [BP] for payment of
premium.” Further, Exhibit C states:
              [BP], its subsidiaries and affiliated companies, co-
              owners, and joint venturers, if any, and their
              employees, officers and agents shall be named as
              additional insureds in each of [Transocean’s]
              policies, except Workers’ Compensation for
              liabilities assumed by [Transocean] under the
              terms of this Contract.
(Emphasis added.)
The Procedural History
       Following the Incident, BP notified the Insurers of its Deepwater Horizon-
related losses.      The Excess Insurers and Ranger each filed a one-count
declaratory judgment action against BP.3                 The Insurers’ complaints are
substantively identical—both request a declaration that the Insurers have “no
additional-insured obligation to BP with respect to pollution claims against BP
for oil emanating from BP’s well” as a result of the Deepwater Horizon Incident.
The Insurers acknowledge that “the [D]rilling [C]ontract requires additional
insured protection in favor of certain BP entities.” Thus, all parties concede that
the Drilling Contract is an “insured contract” under the policies and that the
policies provide some insurance coverage to BP as an additional insured. The
issue in contention is the scope of BP’s insurance coverage.
       In July 2011, BP moved for judgment on the pleadings, under Rule 12(c)
of the Federal Rules of Civil Procedure, against the Insurers. Relying upon

       3
         In February 2011, the Judicial Panel on Multidistrict Litigation transferred both cases
to the United States District Court for the Eastern District of Louisiana for coordinated
pretrial proceedings with the other Deepwater Horizon-related litigation pending in that court.
In March 2011, Transocean moved for leave to intervene in the consolidated actions, which
motion the court granted.

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                                          No. 12-30230

Texas and Fifth Circuit precedent as developed in Evanston Ins. Co. v.
ATOFINA Petrochems., Inc., 256 S.W.3d 660 (Tex. 2008), and in Aubris
Resources LP v. St. Paul Fire & Marine Ins. Co., 566 F.3d 483 (5th Cir. 2009), BP
argued (1) it was an “additional insured” under the insurance policies at issue
and (2) the insurance policies alone—and not the indemnities detailed in the
Drilling Contract—govern the scope of BP’s coverage rights as an “additional
insured.”4
       The district court found ATOFINA and Aubris are distinguishable from
the case at hand and denied BP’s Rule 12(c) motion in November 2011. In
particular, the court read Transocean’s insurance obligation in Exhibit C to be
to name BP as an “additional insured[] in each of [Transocean’s] policies . . . for
liabilities assumed by [Transocean] under the terms of the contract.” That is,
the district court found BP’s proffered reading of this clause unreasonable, and
read the clause as if there were a comma following the phrase “except Workers’
Compensation;” this reading rendered those three words their own discrete carve
out from liability.          Reasoning further that this interpretation required
Transocean to name BP as an insured only for liabilities Transocean explicitly
assumed under the contract, the court then looked to Article 24 of the Drilling
Contract to conclude that BP was not covered under Transocean’s policy for the
pollution-related liabilities deriving from the Deepwater Horizon Incident (as the
spill originated below the surface of the water).5

       4
        BP argues this motion did not require a determination of any rights or obligations of
BP or Transocean to one another under any provisions of the Drilling Contract. We agree.
       5
           With respect to pollution-related liabilities, Article 24.1 of the Contract provides:
                CONTRACTOR [Transocean] shall assume full responsibility for and
                shall protect, release, defend, indemnify, and hold COMPANY [BP] and
                its joint owners harmless from and against any loss, damage, expense,
                claim, fine, penalty, demand, or liability for pollution or
                contamination, including control and removal thereof, originating on
                or above the surface of the land or water, from spills, leaks, or

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                                       No. 12-30230

       Following further submissions of the parties, the district court then
entered a partial final judgment on the Insurers’ complaints under Rule 54(b).
Effective March 1, 2012, the court held “by its terms, the Court’s Order and
Reasons [on BP’s motion for judgment on the pleadings] not only denied BP’s
motion but also granted judgment on the pleadings against [BP] and in favor of
the Plaintiff Insurers on the Plaintiff Insurers’ complaints.”6                    BP timely
appealed.
                                              II.
       We review de novo a district court’s grant of judgment on the pleadings
under Rule 12(c). United States v. Renda Marine, Inc., 667 F.3d 651, 654 (5th
Cir. 2012). The standard for dismissal under Rule 12(c) is the same as that for
dismissal under Rule 12(b)(6). Johnson v. Johnson, 385 F.3d 503, 529 (5th Cir.
2004). To survive a Rule 12(b)(6) motion, the plaintiff must plead facts sufficient
“to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)).

              discharges of fuels, lubricants, motor oils, pipe dope, paints, solvents,
              ballast, air emissions, bilge sludge, garbage, or any other liquid or solid
              whatsoever in possession and control of CONTRACTOR . . . .

(Emphasis added.) Article 24.2 then provides:
            COMPANY [BP] shall assume full responsibility for and shall protect,
            release, defend, indemnify, and hold CONTRACTOR [Transocean]
            harmless from and against any loss, damage, expense, claim, fine,
            penalty, demand, or liability for pollution or contamination,
            including control and removal thereof, arising out of or connected
            with operations under this CONTRACT hereunder and not
            assumed by CONTRACTOR in Article 24.1 above . . . .
(Emphasis added.)
       6
        In its brief, BP notes that this partial final judgment was entered in favor of the
Insurers “and Transocean” and argues that Transocean is not a proper party to this order.
BP’s Rule 12(c) motion was directed only to the Insurer’s complaints and claims—not against
Transocean.

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                                    No. 12-30230

      We similarly review issues of contract interpretation de novo. One Beacon
Ins. Co. v. Crowley Marine Servs. Inc., 648 F.3d 258, 262 (5th Cir. 2011). The
parties agree that Texas law governs interpretation of the Policies, under the
Policies’ choice-of-law provisions. “Under Texas law, the same general rules
apply to the interpretation of contracts and insurance policies.” Aubris, 566 F.3d
at 486 (citing Am. Mfrs. Mut. Ins. Co. v. Schaefer, 124 S.W.3d 154, 157 (Tex.
2003)). Courts should consider contracts “as a whole,” affording “each part of the
contract . . . effect.” Forbau v. Aetna Life Ins. Co., 876 S.W.2d 132, 133 (Tex.
1994). Discerning the parties’ true intent, as expressed in the language of the
policy, is the court’s primary concern. Kelley-Coppedge, Inc. v. Highlands Ins.
Co., 980 S.W.2d 462, 464 (Tex. 1998).           And the court may not adopt a
construction that renders any portion of a policy meaningless, useless, or
inexplicable. ATOFINA Petrochemicals, Inc. v. Cont’l Cas. Co., 185 S.W.3d 440,
444 (Tex. 2005).
      If an insurance coverage provision is susceptible to more than one
reasonable interpretation, the court must interpret that provision in favor of the
insured, so long as that interpretation is reasonable. Nat’l Union Fire Ins. Co.
of Pittsburgh, Pa. v. Hudson Energy Co., 811 S.W.2d 552, 555 (Tex. 1991). The
court must do so even if the insurer’s interpretation is more reasonable than the
insured’s—“[i]n particular, exceptions or limitations on liability are strictly
construed against the insurer and in favor of the insured,” id., and “[a]n intent
to exclude coverage must be expressed in clear and unambiguous language.”
ATOFINA, 256 S.W.3d at 668, 668 n.27 (citing Hudson Energy Co., 811 S.W.2d
at 555); see also Certain Underwriters at Lloyds, London v. Law, 570 F.3d 574,
577 (5th Cir. 2009) (“If . . . ambiguity is found, the contractual language will be
‘liberally’ construed in favor of the insured.” (citing Barnett v. Aetna Life Ins. Co.,
723 S.W.2d 663, 666 (Tex. 1987))).

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                                            III.
       Under Texas law, to discern “whether a commercial umbrella insurance
policy that was purchased to secure the insured’s indemnity obligation in a
service contract with a third party also provides direct liability coverage for the
third party,” we look to the “terms of the umbrella insurance policy itself,”
instead of looking to the indemnity agreement in the underlying service contract.
ATOFINA, 256 S.W.3d at 662, 664; see also Aubris, 566 F.3d at 488-89. We
apply this analysis so long as the indemnity agreement and the insurance
coverage provision are separate and independent. ATOFINA, 256 S.W.3d at 664
n.5 (citing Getty Oil Co. v. Ins. of N. Am., 845 S.W.2d 794, 804 (Tex. 1992);
Aubris, 566 F.3d at 489. We examine each step of the analysis in turn.
                                             A.
       First, we ask whether the umbrella policy between the Insurers and
Transocean itself limits coverage for any additional insureds, including BP.
ATOFINA is instructive, as its facts significantly parallel the facts of the case
now before us. 256 S.W.3d 660. ATOFINA owned an oil refinery at which it
hired Triple S to perform maintenance functions. Id. at 662. ATOFINA and
Triple S entered a services contract which stipulated that ATOFINA was to be
named an additional insured in each of Triple S’s policies.                    Id. at 663.
Specifically, this provision stated:
              [ATOFINA], its parents, subsidiaries and affiliated
              companies, and their respective employees, officers and
              agents shall be named as additional insured in each of
              [Triple S’s] policies, except Workers’ Compensation;
              however, such extension of coverage shall not apply
              with respect to any obligations for which [ATOFINA]
              has specifically agreed to indemnify [Triple S].7

       7
       Petitioner’s Br. on the Merits, Evanston Ins. Co. v. ATOFINA Petrochemicals, Inc., 256
S.W.3d 660 (Tex. 2008) (No. 03-0647), 2004 WL 1047377, at *4.

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      After a Triple S employee drowned while servicing the ATOFINA refinery,
his estate sued ATOFINA and Triple S for wrongful death. Id. at 663. Triple S’s
insurer, Evanston, and ATOFINA disagreed over who was required to pay for
the litigation; ATOFINA contended it was an additional insured and thus
covered, while Evanston argued ATOFINA’s agreement to indemnify Triple S for
ATOFINA’s sole negligence precluded coverage. Id.
      The Texas Supreme Court began by noting that ATOFINA sought
coverage from Evanston on the basis that it was Triple S’s additional
insured—and had not sought indemnity directly from Triple S. Id. at 663-64.
The court next looked to Section III.B.6 of the policy, which defined who is an
insured as
             A person or organization for whom you have agreed to
             provide insurance as is afforded by this policy; but that
             person or organization is an insured only with respect
             to operations performed by you or on your behalf, or
             facilities owned or used by you.
Id. at 664. Because, by its own terms, this Section covered ATOFINA “with
respect to operations performed by” Triple S, the court found this Section
provided ATOFINA direct coverage even for its sole negligence. Id. at 667.
Moreover, the court stated that “had the parties intended to insure ATOFINA
for vicarious liability only, ‘language clearly embodying that intention was
available.’” Id. at 666 (citing McIntosh v. Scottsdale Ins. Co., 992 F.2d 251, 255
(10th Cir. 1993)).
      This Court subsequently applied ATOFINA’s teachings in Aubris. 566
F.3d 483. Again, this case involved a particularly analogous set of facts: United
hired J&R Valley to service its oilfields pursuant to a services contract that
required J&R Valley to name United as an additional insured in its commercial
general liability policy. Id. at 485. The agreement further contained a general
indemnity provision requiring United to indemnify J&R Valley for causes of

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action deriving from United’s own negligence. Id. at 485-86. The court noted
that “[o]ur starting point is the insurance policy itself.” Id. at 487. This policy
defined an additional insured as
            Any person or organization that you agree in a written
            contract for insurance to add as an additional protected
            person under this agreement is also a protected person
            for the following if that written contract for
            insurance specifically requires such coverages for
            that person or organization[.]
Id. (emphasis in original).    Because this definition referred to a “written
contract for insurance,” the court then looked to the additional insured provision
in the services agreement to determine whether coverage was required. Id.
That provision stated, in relevant part:
            UNITED . . . shall be named as additional insureds in
            each of [J&R Valley’s] policies, except Workers’
            Compensation; however, such extension of
            coverage shall not apply with respect to
            obligations for which UNITED has specifically
            agreed to indemnify [J&R Valley].
Id. (emphasis in original). On the basis of this term, J&R Valley’s insurer
argued the general indemnity provision of the services agreement prevented
United from being covered. Id.
      The court disagreed, stating, “[w]e take from [ATOFINA] that in
determining whether there is coverage, a court looks only to the additional
insured provision itself; that indemnity is a separate, and later arising, question
from coverage.” Id. at 488. Again, the court noted that United sought coverage
from J&R Valley’s insurer and not indemnity from J&R Valley itself—just as
ATOFINA sought coverage from Evanston and not indemnity from Triple S. Id.
at 489.
      The court held:

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               [I]t is not material to the [ATOFINA] rule whether the
               additional insured provision is finally determined in the
               policy or with the aid of the parties’ service contract.
               The separate indemnity provision is not applied to limit
               the scope of coverage. Indeed, on this point the Texas
               Supreme Court could not have been clearer:

               We have noted that where an additional insured
               provision is separate from and additional to an
               indemnity provision, the scope of the insurance
               requirement is not limited by the indemnity clause.
Id. at 489 (quoting ATOFINA, 256 S.W.3d at 664 (citing Getty Oil Co. v. Ins. Co.
of N. Am., 845 S.W.2d 794, 804 (Tex. 1992))).
      Most recently, and subsequent to the district court’s ruling, the Texas
Court of Appeals addressed this same question of coverage in Pasadena Refining
System, Inc. v. McCraven, Nos. 14-10-00837-CV, 14-10-00860-CV, 2012 WL
1693697 (Tex. App. May 15, 2012). The umbrella policy there provided a broad
definition of “additional insured,”8 and the services agreement required the

      8
          2012 WL 1693697, at *14-15:
               Any person or organization . . . for whom the named insured . . . has
               specifically agreed by written contract to procure bodily injury . . .
               insurance, provided that:
                  a. This insurance applies only to the type of coverage which is
                  otherwise provided by this policy and which the named insured
                  has agreed to provide by contract, but in no event shall the
                  coverage exceed, in type or amount, the coverage otherwise
                  provided by this policy;
                  b. The amount of insurance is limited to the minimum amount
                  required by such written contract, or to the limits of liability
                  provided by this policy, whichever is lower;
                  c. The insurance applies only with respect to liability arising out
                  of the work done by or on behalf of the named insured under such
                  written contract; and
                  d. This insurance shall apply as primary insurance with regard
                  to the additional insured for whom the named insured has agreed
                  by written contract to provide insurance on a primary basis, and
                  in such cases, any other insurance or self insurance available to
                  the additional insured shall be excess to, and not contributory
                  with, the insurance afforded by this policy to that additional
                  insured. However, if the contract does not specifically require

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                                   No. 12-30230
            COMPANY be named as an additional insured in all
            such certificates, except insurance providing protection
            against worker’s or workmen’s compensation claims, to
            the extent of the coverage required and only in the
            minimum amount required by contract, and only with
            respect to liability arising out of work done by or on
            behalf of the named insured, and only to the extent
            COMPANY is indemnified by CONTRACTOR under
            the terms of the contract.
Id. at *14. The insurer argued that this clause in the services agreement
expressed the parties’ clear intent to limit additional insured coverage to the
indemnities listed in that agreement. Id. at *16. The court, however, applied
ATOFINA and Shell Chemical L.P. v. Discover Property & Casualty Insurance
Co., CIV. A. No. H-09-2583, 2010 WL 1338068 (S.D. Tex. Mar. 29, 2010), and
concluded that only the policy could limit the scope of additional insured status.
2012 WL 1693697, at *15-16. Looking to the “unambiguous [umbrella] policy,
which neither contains a limitation on additional insured coverage concerning
indemnity under the [services] agreement nor incorporates any such limitation,”
the court held the company was an additional insured entitled to coverage as a
matter of law. 2012 WL 1693697, at *14, *16-17.
      This case law makes clear to us that only the umbrella policy itself may
establish limits upon the extent to which an additional insured is covered in
situations such as the one now before us. As an initial matter we note that here,
as in ATOFINA and Aubris, BP is not seeking indemnity from Transocean, but
is seeking coverage from the Insurers. The umbrella policy in this case defines
an additional insured as “any person or entity to whom the ‘Insured is obliged

               that this insurance be primary, this insurance shall be excess
               over and not contributory with any other valid and collectible
               insurance or self insurance available to the additional insured
               whether such other insurance or self insurance is primary,
               excess, or contingent, or on any other basis.

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                                        No. 12-30230
by any oral or written ‘Insurance Contract’ . . . to provide insurance such as is
afforded by this policy.” And it defines “Insurance Contract” as “any written or
oral contract or agreement entered into by the ‘Insured’ . . . and pertaining to
business under which the ‘Insured’ assumes the tort liability of another party to
pay for ‘Bodily Injury’, ‘Property Damage’, ‘Personal Injury’ or ‘Advertising
Injury’ to a ‘Third Party’ or organization.” This language is very similar to the
language in the umbrella policies in ATOFINA, Aubris, and Pasadena
Refining—indeed, we can find no principled distinction between the policy
language in these three cases and in the case now at hand.9 Just as the policies
in these three earlier cases did not limit coverage, so here the policy itself does
not contain any limitation on additional insured coverage nor incorporate any
limits from the underlying Drilling Contract.
       The Insurers, however, argue that the additional insured provision in the
Drilling Contract specifically limits BP’s status as an additional insured to
circumstances involving those liabilities Transocean specifically assumes under
the Contract. This argument is simply not persuasive given how Texas law has
developed. The language to which the Insurers cite for support is virtually
identical to the additional insured provision contained in the services agreement
in ATOFINA; additionally, it is very similar to the language in both Aubris and
Pasadena Refining.         To make the parallels clear, we note again that the
agreement in ATOFINA provided that
               [ATOFINA], its parents, subsidiaries and affiliated
               companies, and their respective employees, officers and

       9
         The district court distinguished the current case from ATOFINA by noting that the
policy in that case, in defining “additional insured,” did not specifically refer to an underlying
services contract. This is a true, but ultimately an unpersuasive distinction. First, that policy
did include in its additional insured definition language referencing entities “for whom you
have agreed to provide insurance as is afforded by this policy.” Second, the policies in both
Aubris and Pasadena Refining specifically reference an underlying contract requiring
insurance coverage in their definitions of additional insureds, yet in each of these cases the
respective courts found this reference insufficient to constitute a limit on coverage.

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                                  No. 12-30230
            agents shall be named as additional insured in each of
            [Triple S’s] policies, except Workers’ Compensation;
            however, such extension of coverage shall not apply
            with respect to any obligations for which [ATOFINA]
            has specifically agreed to indemnify [Triple S].
And the Drilling Contract here requires:
            [BP], its subsidiaries and affiliated companies, co-
            owners, and joint venturers, if any, and their
            employees, officers and agents shall be named as
            additional insureds in each of [Transocean’s] policies,
            except Workers’ Compensation for liabilities assumed
            by [Transocean] under the terms of this Contract.
      While the parties ardently disagree as to how this clause in the Drilling
Contract should be interpreted, we find, in the light of ATOFINA, that we need
not now decide this contentious issue. Even if the clause is construed as the
Insurers desire, that is, even if it is understood to mean that BP is an additional
insured under Transocean’s policies only for liabilities Transocean specifically
assumed in the Drilling Contract, the outcome is a clause materially identical
to the additional insured provision in ATOFINA—and the Texas Supreme Court
found that this clause was insufficient to limit coverage. Despite the services
contract’s language, the ATOFINA court found the umbrella policy controlled
coverage. Accordingly, we find we are bound to look only to the policy itself to
determine whether BP is covered in the current case. Because the umbrella
policy’s provision describing an additional insured is substantially similar to the
pertinent policy provisions in ATOFINA, Aubris, and Pasadena Refining, we
hold that there is no relevant limitation to BP’s coverage under the policy as an
additional insured, that is, so long as the insurance provision and the
indemnities clauses in the Drilling Contract are separate and independent. See
ATOFINA, 256 S.W.3d at 664 n.5, 670; Getty Oil, 845 S.W.2d at 804.

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                                 No. 12-30230
                                       B.
      And now that is the question we must next resolve: Whether the Drilling
Contract’s additional insured provision is separate from and additional to the
indemnity provisions. Getty Oil, 845 S.W.2d at 804. Notably, in ATOFINA,
Aubris, and Pasadena Refining, the respective courts found the additional
insured provisions were independent of the indemnity provisions. ATOFINA
considered two cases in reaching this conclusion. First, it examined Fireman’s
Fund v. Commercial Standard Ins. Co., 490 S.W.2d 818 (Tex. 1972), in which the
Texas Supreme Court held GM was not entitled to indemnity because the
contract did not extend indemnity to GM’s negligence. In that case, GM had
contracted with Sam P. Wallace Co., Inc. (“Wallace”) to perform work on GM’s
Arlington assembly plant, and, in the contract, Wallace agreed to indemnify GM
for any losses arising from Wallace’s own negligence and to obtain liability
insurance to satisfy that obligation.       Id. at 820.    The ATOFINA court
distinguished that case by noting that in Fireman’s Fund, GM was not an
additional insured under Wallace’s liability policy—while Wallace was required
to obtain insurance to cover its liabilities, it was not further required to name
GM as an additional insured in those policies. 256 S.W.3d at 669-70. As
described below, this same distinction applies to the case now before us.
      Second, the ATOFINA court looked to Getty Oil, 845 S.W.2d 794. Getty
contracted with NL Industries to purchase chemicals, and the services contract
included an indemnity provision as well as a broad insurance requirement
providing, in paragraph 1, that “[a]ll insurance coverages carried by [NL],
whether or not required hereby, shall extend to and protect [Getty.]” Id. at 797.
The Getty Oil court found this contract was “significantly different from that in
Fireman’s Fund.” Id. at 804. It reasoned that, while the indemnity provision in
paragraphs 3-4 of the relevant contract was supported by an insurance

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                                      No. 12-30230
provision, this provision was “separate from and additional to the additional
insured provision in paragraphs 1-2.” Id.
      The ATOFINA court applied the reasoning in these cases to find that,
“[a]lthough the service contract in this case does not include an insurance
requirement quite as clear as the one in Getty, it is clear enough—it requires
that ATOFINA ‘shall be named as additional insured in each of [Triple S’s]
policies.’” 256 S.W.3d at 670 (alteration in original). The court then concluded
it was
               unmistakable that the agreement in this case to extend
               direct insured status to ATOFINA as an additional
               insured is separate and independent from ATOFINA’s
               agreement to forego contractual indemnity for its own
               negligence. We disapprove the view that this kind of
               additional insured requirement fails to establish a
               separate and independent obligation for insuring
               liability.
Id. (emphasis in original).
      Accordingly, to render an additional insured provision separate from and
additional to an indemnity provision, Texas law only requires the additional
insured provision be a discrete requirement. As evidenced in Getty Oil and
ATOFINA, it need not be an entirely separate provision of the contract, and its
independent status is not altered merely by the fact that the contract also
includes a provision requiring the relevant party to obtain insurance to cover its
liabilities under the contract.
      Here, as the Insurers note, one clause of Exhibit C (describing
Transocean’s insurance obligations) requires Transocean to obtain coverage for
its contractual liabilities,10 while another provision simply requires Transocean

      10
           See Exhibit C, ¶ 1.c:
                1. The insurance required to be carried by [Transocean] under this
                Contract is as follows:
                ...

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                                      No. 12-30230
to name BP as an additional insured.11 This setup is similar to the contract in
Getty Oil, which imposed a requirement that NL obtain insurance for its
contractual liabilities in paragraphs 3-4, while requiring Getty be named an
additional insured in paragraphs 1-2.              Moreover, the additional insured
provision here is nearly identical to the additional insured provision in
ATOFINA. Accordingly, we hold, under Texas case law, it is “unmistakable”
that the provision in the Drilling Contract extending direct insured status to BP
is separate and independent from BP’s agreement to forego contractual
indemnity in various other circumstances. See ATOFINA, 256 S.W.3d at 670.
                                            IV.
       Texas law compels us to interpret insurance coverage provisions in favor
of the insured, so long as that interpretation is reasonable—and even if the
insurer’s proffered interpretation denying coverage is more reasonable. Id. at
668, 668 n.27; Hudson Energy Co., 811 S.W.2d at 555. Texas law further
establishes that “‘where an additional insured provision is separate from and
additional to an indemnity provision, the scope of the insurance requirement is
not limited by the indemnity claims.’” Pasadena Refining, 2012 WL 1693697, at
*17 (quoting ATOFINA, 256 S.W.3d at 664 n.5); see also Aubris, 566 F.3d at 488-
89. Accordingly, we conclude: Because we find the umbrella policies between
the Insurers and Transocean do not impose any relevant limitation upon the
extent to which BP is an additional insured, and because the additional insured

                c. Comprehensive General Liability Insurance, including
                contractual liability insuring the indemnity agreement as
                set forth in the Contract and products-completed operations
                coverage with a combined single limit of not less than
                $10,000,000 covering bodily injury, sickness, death and property
                damage.
(Emphasis added.)
       11
         Exhibit C, ¶ 3: “[BP] . . . shall be named as additional insureds in each of
[Transocean’s] policies, except Workers’ Compensation for liabilities assumed by [Transocean]
under the terms of this Contract.”

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                                 No. 12-30230
provision in the Drilling Contract is separate from and additional to the
indemnity provisions therein, we find BP is entitled to coverage under each of
Transocean’s policies as an additional insured as a matter of law. We reverse
the judgment of the district court and remand the case with instructions to enter
the appropriate judgment consistent with this opinion.
                         REVERSED and REMANDED for entry of judgment.

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