In the Court of Appeals Second Appellate District of Texas at Fort Worth ___________________________ No. 02-24-00024-CV ___________________________
ROBERT LANE, Appellant
V.
ODLE, INC., Appellee
On Appeal from the 442nd District Court Denton County, Texas Trial Court No. 22-8611-442
Before Birdwell, Bassel, and Womack, JJ. Memorandum Opinion by Justice Womack MEMORANDUM OPINION
I. INTRODUCTION
Appellant Robert Lane was injured at work and sued his employer, Appellee
Odle, Inc., alleging that Odle had been negligent and was a workers’ compensation
nonsubscriber under the Texas Workers’ Compensation Act (TWCA). See Tex. Lab.
Code Ann. § 406.033 (explaining that without workers’ compensation insurance, an
employer may not raise certain defenses to an employee’s negligence claim).
In its answer, Odle asserted that Lane had been receiving workers’
compensation benefits and raised as affirmative defenses Lane’s election of remedies
and his exclusive remedy under Labor Code Section 408.001. See id. § 408.001(a)
(“Recovery of workers’ compensation benefits is the exclusive remedy of an employee
covered by workers’ compensation insurance coverage . . . for . . . a work-related
injury sustained by the employee.”). Odle moved for a traditional summary judgment
under Section 408.001(a), and Lane filed a combined response and cross-motion for a
traditional and no-evidence summary judgment in which he insisted that Odle was a
TWCA nonsubscriber and that Odle had no evidence that its workers’ compensation
policy had been approved by the Texas Department of Insurance (TDI).1
1 Odle amended its summary judgment motion to include its election-of- remedies defense, but Lane did not amend his response. Because we resolve this appeal on Odle’s exclusive-remedy affirmative defense, we need not consider Lane’s argument that the trial court could have impermissibly granted Odle’s amended motion by default based on his failure to file an amended response. Cf. Mailloux v. KJ Env’t Mgmt., Inc., No. 02-20-00059-CV, 2020 WL 6334176, at *2 (Tex. App.—Fort
2 The trial court granted summary judgment for Odle and denied Lane’s cross-
motion, and in his two issues on appeal, Lane complains that this was error. Because
the record reflects that the trial court did not so err, we overrule both of Lane’s issues
and affirm the trial court’s judgment.
II. BACKGROUND
A. Odle’s summary judgment arguments and evidence
Odle argued that the TWCA barred Lane’s negligence claim because Odle’s
uncontroverted summary judgment evidence established that Lane was its employee
and that he was covered by workers’ compensation insurance when he was injured.
To support its argument, Odle attached Lane’s amended original petition in which
Lane alleged—among other things—that on March 15, 2021, when he was injured, he
had been “working in the course and scope of his employment” for Odle at a jobsite
in Texas. Odle also attached the affidavit of Joseph Greiner, an Odle Service Center
Manager, who averred that at the time of Lane’s injuries, Lane had worked for Odle
and had been covered by workers’ compensation insurance under a policy issued to
Odle’s parent company, SUEZ North America Inc., by Everest Premier Insurance
Company (the SUEZ Policy).
Worth Oct. 29, 2020, no pet.) (mem. op.) (explaining that a summary judgment motion cannot be granted by default but rather “must stand or fall on [its] own merits” (quoting McConnell v. Southside ISD, 858 S.W.2d 337, 342 (Tex. 1993)).
3 In his affidavit, Greiner stated that Odle “is an additional named insured under
the SUEZ Policy,” and he sponsored page 114 of the Suez Policy as Exhibit 1. He
also listed Odle’s federal employment ID number (FEIN) and its current and
previous business addresses in Muncie, Indiana. Exhibit 1 shows that, effective
January 1, 2021, SUEZ North America Inc. was the SUEZ Policy’s named insured,
with Odle Inc. (identified by its address and FEIN) as a covered location.
Greiner further averred,
The SUEZ Policy provides workers’ compensation benefits to Odle’s employees in forty (40) states, including Texas, and applies to the workers’ compensation laws of those states. A true and correct copy of the Policy’s declaration page is attached to this Affidavit as Exhibit 2. The Policy contains numerous Texas amendatory endorsements required by [TDI] and the Texas Labor Code. True and correct copies of these amendatory endorsements are attached to this Affidavit as Exhibit 3.
Finally, the SUEZ Policy contains a Texas classification of operations page establishing that SUEZ/Odle paid workers’ compensation insurance premiums for work-related accidents occurring in Texas, including accidents arising from water storage tank operations, the same activity Lane was performing at the time of his work-related injury. A true and correct copy of the Texas classification of operations/premium page of the SUEZ Policy is attached hereto as Exhibit 4.
Greiner’s Exhibit 2, the SUEZ Policy’s “information page,” lists forty states
and recites in Section 3.A., “Part One of the policy applies to the Workers
Compensation Law of the states listed here: . . . TX . . . .”
Greiner’s Exhibit 3, which was the insurance company’s notice to “Texas
Workers Compensation and Employers Liability Policyholders,” states, “Pursuant to
4 Texas Labor Code § 411.066,[2] Everest Premier Insurance Company is required to
notify its policyholders that accident prevention services are available from Everest
Premier Insurance Company at no additional charge” and that the insurance company
is also “required to provide return-to-work coordination services as required by Texas
Labor Code § 413.021 and to notify you of the availability of the return-to-work
reimbursement program for employers under Texas Labor Code § 413.022.”3 It also
listed the contact information for TDI’s Division of Workers’ Compensation (DWC)
and stated,
If Everest Premier Insurance Company fails to respond to your request for accident prevention services or return-to-work coordination services, you may file a complaint with the TDI–DWC in writing at http://www.tdi.texas.gov or mail to:
Texas Department of Insurance Division of Workers’ Compensation, MS-8, 7551 Metro Center Drive Austin, Texas 78744-1645.
Exhibit 3 also contained the SUEZ Policy’s “TEXAS IMPORTANT
NOTICE,” which stated that if the insured believed there had been a legal violation
related to the workers’ compensation policy, it should “file a complaint with [TDI]”
2 Labor Code Section 411.066 states, “Notice that accident prevention services are available to the policyholder from the insurance company must appear in at least 10-point bold type on the front of each workers’ compensation insurance policy delivered or issued for delivery in this state.” Tex. Lab. Code Ann. § 411.066. 3 Labor Code Section 413.021 addresses return-to-work coordination services. Tex. Lab. Code Ann. § 413.021. Labor Code Section 413.022 addresses a return-to- work reimbursement program for employers. Id. § 413.022.
5 and then listed TDI’s 1-800 phone number, its website, an email address
(ConsumerProtection@tdi.texas.gov), and a specific mailing address (MC111-1A,
P.O. Box 149091, Austin, Texas 78714-9091). The notice page also stated that as to
employees with claim issues, “If one of your employees has a problem with a claim,
contact [TDI, DWC], Compliance and Investigations,” and it listed a different mailing
address (MS-8, 7551 Metro Center Drive, Suite 100, Austin, TX 78744), a fax number
(512-490-1030), an email address (DWC-ComplianceReview@tdi.texas.gov), and
another 1-800 number. Exhibit 3 also contained the “Texas Waiver of Our Right to
Recover From Others Endorsement,” which stated, “This endorsement applies only
to the insurance provided by the policy because Texas is shown in Item 3.A. of the
Information Page,” and it set a two-percent premium charge for the endorsement.
[CR85] Exhibit 3 also included the “Texas Sole Proprietors, Partners, Officers and
Others Coverage Endorsement” under Labor Code Section 406.097. See id. § 406.097
(addressing coverage of a company’s proprietors, partners, or corporate executives).
Greiner’s Exhibit 4 contained premium information for the policy’s Texas coverage,
effective January 1, 2021.
Odle also attached an affidavit from Tandy Lyon, a claims examiner for
Sedgwick Claims Management Services, Inc., which Lyon stated was “the third-party
claims administrator for Everest Premier Insurance Company.” Lyon averred that in
January 2021, Everest issued the SUEZ Policy with Odle as an additional insured and
a policy term of January 1, 2021–January 1, 2022.
6 Lyon further averred that on July 19, 2022, Lane, as one of Odle’s employees,
“made a claim for workers’ compensation benefits under the [SUEZ] Policy arising
from work-related injuries he sustained on or about March 15, 2021”; that she was his
case’s assigned claims examiner; that she had been “adjusting the claim on behalf of
Everest pursuant to the terms and conditions of the [SUEZ] Policy”; and that Everest
had paid to Lane $92,209.56 in indemnity benefits and $3,330.30 in medical benefits
on the claim and would continue to pay him $705 per week until November 8, 2023.
Odle also attached the July 19, 2022 notice of representation Lane’s attorney
had filed with TDI–DWC, listing Lane’s injury date (March 15, 2021) and his DWC
claim number. The notice listed Odle as Lane’s employer and gave Odle’s Muncie,
Indiana address.
B. Lane’s response, cross-motion, and summary judgment evidence
In his summary judgment response and cross-motion, Lane asserted that even
though he was receiving out-of-state insurance policy benefits, Odle could not use the
exclusive-remedy affirmative defense because neither Odle nor SUEZ was a registered
subscriber to the Texas Workers’ Compensation Insurance program and because Odle
could produce no evidence that TDI had approved the SUEZ Policy. Lane relied in
part on Labor Code definitions and on a Texas Administrative Code section that
became effective December 21, 1987. See 28 Tex. Admin. Code § 43.5 (1987) (Tex.
Dep’t of Ins., Notice That Employer Has Become Subscriber).
7 To his response and cross-motion, Lane attached his W-2 showing Odle’s
FEIN; Odle’s franchise tax account status, which states “right to transact business in
Texas: NOT ESTABLISHED” and that Odle had no effective secretary-of-state
registration date; and the same document attached by Greiner as Exhibit 1, showing
SUEZ North America, Inc. as the named insured, with Odle as a location and on
which he highlighted Odle’s Muncie, Indiana address. Lane also attached various
documents from TDI:
• A print-out from the TDI–DWC website showing “no results found” when a
search was run for Odle’s coverage as of March 15, 2021;
• An August 29, 2022 letter from TDI to Lane’s attorney that stated, “Insurance
Coverage Information request for SUEZ WTS USA, INC. 03/15/2021,”4 and that
“No insurance coverage information concerning the above-referenced subject was
found,” and an August 29, 2022 TDI Certification of No Records Found, as to
SUEZ WTS USA, INC.; and
• An August 25, 2022 letter from TDI to Lane’s attorney that stated, “Insurance
Coverage Information request for Odle, Inc., date range of: 03/15/2021,” and that
“No insurance coverage information concerning the above-referenced subject was
4 Like Odle, SUEZ WTS USA INC. is listed on the SUEZ Policy as an additional named insured.
8 found,” and an August 25, 2022 TDI Certification of No Records Found as to
Odle, Inc.
Lane did not attempt to controvert the facts set out in Greiner’s and Lyon’s
affidavits or in Greiner’s exhibits.
C. Odle’s response to Lane’s cross-motion
In response to Lane’s cross-motion, Odle complained that Lane’s arguments
were based on his erroneous open-records request to TDI–DWC for coverage
information on SUEZ WTS USA, Inc. instead of SUEZ North America, the named
insured of the SUEZ Policy, under which Lane had been receiving workers’
compensation benefits. To its response, Odle attached Lane’s exhibit pertaining to
the TDI–DWC searches for insurance coverage for SUEZ WTS USA, INC.
(highlighting the name) and the affidavits and exhibits it had previously filed.
III. DISCUSSION
In his two issues, Lane argues that the trial court erred by granting summary
judgment for Odle and by denying his cross-motion, contending that although Odle
offered some evidence of workers’ compensation coverage, it failed to discharge its
traditional summary judgment burden because it had failed to offer any evidence that
its policy had been “approved” by TDI and because it had failed to offer evidence
that the insurance carrier was authorized to write workers’ compensation insurance in
Texas. He also relies on these arguments and Odle’s failure to show that it had
9 registered as a subscriber with TDI in support of his no-evidence complaints.5 Lane
contends that Odle should have submitted an affidavit from the insurance company’s
managing director or a TDI certification of the insurance company’s authority to
provide workers’ compensation insurance in Texas, that Odle should have shown that
it had met Administrative Code Section 43.5’s insurance coverage notice rule, and that
Odle’s failure to do either deprived it of the exclusive-remedy affirmative defense.
Odle responds that Lane’s arguments fail to raise an inference of no coverage
or a fact issue on the exclusive-remedy defense’s essential elements and that Lane
failed to meet his summary judgment burden by failing to object to or controvert
Odle’s affidavit evidence.
A. Standard of review
We review a summary judgment de novo. Travelers Ins. Co. v. Joachim,
315 S.W.3d 860, 862 (Tex. 2010). We consider the evidence presented in the light
most favorable to the nonmovant, crediting evidence favorable to the nonmovant if
reasonable jurors could, and disregarding evidence contrary to the nonmovant unless
reasonable jurors could not. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289
S.W.3d 844, 848 (Tex. 2009). We indulge every reasonable inference and resolve any
doubts in the nonmovant’s favor. 20801, Inc. v. Parker, 249 S.W.3d 392, 399 (Tex.
5 Lane also argues that he made no election of remedies by merely accepting the out-of-state workers’ compensation benefits. Based on our disposition of Odle’s exclusive-remedy summary judgment ground, we do not reach these arguments. See Tex. R. App. P. 47.1.
10 2008). A defendant is entitled to summary judgment on an affirmative defense if the
defendant conclusively proves all elements of that defense. Frost Nat’l Bank v.
Fernandez, 315 S.W.3d 494, 508–09 (Tex. 2010); see Tex. R. Civ. P. 166a(b), (c). And
“[w]hen both sides move for summary judgment and the trial court grants one motion
and denies the other, we review the summary judgment evidence presented by both
sides and determine all questions presented.” Mann Frankfort, 289 S.W.3d at 848. We
should then render the judgment that the trial court should have rendered. See id.
B. The TWCA’s framework
“The Texas Legislature enacted the original Workers’ Compensation Act
in 1913 in response to the needs of workers who, despite a growing incidence of
industrial accidents, were increasingly being denied recovery.” In re Poly-Am., L.P.,
262 S.W.3d 337, 350 (Tex. 2008) (orig. proceeding). The TWCA “ultimately struck a
bargain that allows employees to receive []a lower, but more certain, recovery than
would have been possible under the common law[].” SeaBright Ins. Co. v. Lopez,
465 S.W.3d 637, 642 (Tex. 2015); see Berkel & Co. Contractors, Inc. v. Lee, 612 S.W.3d
280, 284 (Tex. 2020) (explaining that a central purpose of workers’ compensation is to
promote certainty and speed in resolving work-related injury claims and to provide
medical and disability benefits without regard to fault of either the injured worker or
the employer); see also Tex. Mut. Ins. Co. v. Ruttiger, 381 S.W.3d 430, 439 (Tex. 2012)
(recounting the TWCA’s history and noting that the amendments from 1989 onward
“provide[d for] significantly more meaningful proceedings at the administrative
11 agency level so as to reduce the number and cost of judicial trials, speed up the time
for the entire dispute resolution process, and facilitate interlocutory payment of
benefits pending final resolution of disputes” through “detailed procedures and
penalties for failures of the various interested parties to comply with statutory and
regulatory requirements”).
Today, the TWCA is “a comprehensive legislative framework that creates a
statewide no-fault insurance system for workers injured or killed in the course and
scope of their employment.” Tex. Pol. Subdivisions Joint Self-Ins. Fund v. Tex. Dep’t of
Ins.–Div. of Workers’ Comp., 681 S.W.3d 491, 493 (Tex. App.—Austin 2023, pet.
denied); see Tex. Mut. Ins. Co. v. PHI Air Med., LLC, 610 S.W.3d 839, 858 (Tex. 2020)
(Bland, J., concurring) (“The [TWCA] is a comprehensive regulatory structure for
insurance carriers, employers, employees, health care providers, and others who claim
benefits under a workers’ compensation policy.”).
The TWCA’s purpose is to provide employees with certainty that their medical
bills and lost wages will be covered if they are injured, HCBeck, Ltd. v. Rice,
284 S.W.3d 349, 350 (Tex. 2009), but the coverage “is a two-way street,” benefitting
both employees and employers. Waste Mgmt. of Tex., Inc. v. Stevenson, 622 S.W.3d 273,
285 (Tex. 2021). That is, employers who cover their employees benefit from the
exclusive-remedy protection under Labor Code Section 408.001(a), and workers who
qualify as employees receive compensation for injuries without regard to fault or
negligence and without spending the time and litigation expenses inherent in proving
12 fault in a common-law tort claim. Id. The supreme court has historically construed
the TWCA liberally in favor of coverage based on these reciprocal benefits. Id.; see
TIC Energy & Chem., Inc. v. Martin, 498 S.W.3d 68, 72, 74, 77–78 (Tex. 2016) (noting
“decided bias” for coverage in statutory scheme).
“Unlike workers’ compensation laws in every other state, the TWCA allows
private Texas employers to choose whether to subscribe to workers’ compensation
insurance.” Port Elevator-Brownsville v. Casados, 358 S.W.3d 238, 241 (Tex. 2012). That
is, there is no guarantee that an employer will provide workers’ compensation for its
employees despite public policy’s strongly encouraging it. HCBeck, Ltd., 284 S.W.3d
at 354. But without such coverage, the employer loses the exclusive-remedy defense.
Id.
1. Section 408.001(a)’s exclusive remedy
Section 408.001(a) provides that recovery of workers’ compensation benefits
“is the exclusive remedy” against an employer for a work-related injury by “an
employee covered by workers’ compensation insurance coverage.” Tex. Lab. Code
Ann. § 408.001(a). The TWCA defines “employer” as “unless otherwise specified, a
person who makes a contract of hire, employs one or more employees, and has workers’
compensation insurance coverage.” Id. § 401.011(18) (emphasis added). Under the TWCA,
“workers’ compensation insurance coverage” means “an approved insurance policy to
secure the payment of compensation.” Id. § 401.011(44)(A).
13 As pointed out by Lane, Section 401.011 does not define “approved.” See id.
However, the supreme court has stated that “[a]mong the[ TWCA’s] requirements is
the legislative directive that only workers’ compensation policies approved by [TDI] are
available in Texas.” Fairfield Ins. Co. v. Stephens Martin Paving, LP, 246 S.W.3d 653, 658
(Tex. 2008) (emphasis added). “These state-approved policies are contracts between
private insurance companies and employers; the employees of subscribing employers
are the beneficiaries, and health care providers claim direct benefits under the policy.”
Tex. Mut. Ins. Co., 610 S.W.3d at 859 n.26 (Bland, J., concurring) (citing Tex. Lab.
Code Ann. §§ 406.003, .051, 408.001); see Beldon Roofing & Remodeling Co. v. San Antonio
Water Sys., 898 S.W.2d 351, 354 (Tex. App.—San Antonio 1995, writ denied) (stating
that the “workers’ compensation insurance coverage” definition under Section
401.011(44) restricts the methods by which an employer may obtain such coverage).
Labor Code Section 401.011 defines “insurance carrier” as, among other things,
an insurance company, and it defines “insurance company” as “a person authorized
and admitted by [TDI] to do insurance business in this state under a certificate of
authority that includes authorization to write workers’ compensation insurance.” Tex.
Lab. Code Ann. § 401.011(27)–(28); see id. § 406.003 (“An employer may obtain
workers’ compensation insurance coverage through a licensed insurance company or
through self-insurance as provided by this subtitle.”); see also Tex. Ins. Code Ann.
§ 2052.001 (defining “insurance company,” in relation to workers’ compensation, as
an entity “authorized to engage in the business of workers’ compensation insurance in
14 this state”). Labor Code Section 406.051(b) requires an insurance company
contracting to provide workers’ compensation insurance under the TWCA to write
the coverage contract “on a policy and endorsements approved by [TDI].” Tex. Lab.
Code Ann. § 406.051(a)–(b); see Tex. Ins. Code Ann. § 2052.002(a)–(b) (requiring
standard policy forms and a uniform policy for workers’ compensation insurance and
stating that “an insurance company may not use a form other than one prescribed
under this section unless the form is an endorsement: (1) appropriate to the
company’s plan of operation; and (2) submitted to and approved by [TDI]”). TDI is
supposed to coordinate with the appropriate agencies of other states to share
information regarding an employer who obtains all-states coverage and to ensure that
TDI knows about an employer who obtains all-states coverage in another state but
who fails to file notice with TDI.6 Tex. Lab. Code Ann. § 406.053.
2. Notifications and administrative violations
Under Labor Code Section 406.004(a), an employer who does not obtain
workers’ compensation insurance coverage “shall notify the division in writing, in the
time and as prescribed by commissioner rule, that the employer elects not to obtain
coverage.” Id. § 406.004(a). Under Section 406.006(a), an insurance company from
6 Odle correctly points out that Lane’s reference in his appellate brief to his TDI–DWC website searches for SUEZ North America and SUEZ NA cannot be considered in this appeal. Lane acknowledges that these searches were conducted “too late to make it into the record.” We must determine a case based on the record as filed. See Murphy v. Leveille, No. 2-08-130-CV, 2009 WL 2619857, at *2 n.3 (Tex. App.—Fort Worth Aug. 26, 2009, no pet.) (mem. op.).
15 which an employer has obtained workers’ compensation insurance coverage “shall file
notice of the coverage and claim administration contact information with the division
not later than the 10th day after the date on which the coverage or claim
administration agreement takes effect, unless the commissioner adopts a rule
establishing a later date for filing.” Id. § 406.006(a). The required notice “shall be
filed with [DWC] in accordance with Section 406.009,” which requires DWC to
collect and maintain this information and to monitor compliance. Id. §§ 406.006(b),
.009(a), (d).
As last updated December 21, 1987, notice that an employer has become a
subscriber “shall be filed with the board’s Austin office by certified mail or in person
within 30 days of the effective date of the policy and the notice must be completed in
detail,” with—among other things—the employer’s FEIN, the insurance policy
number, the policy’s effective date, and the insurance company’s complete name.
28 Tex. Admin. Code § 43.5. Likewise, insurance carriers are also required to notify
DWC of workers’ compensation insurance coverage. Id. § 110.1(d)–(e) (2013) (Tex.
Dep’t of Ins., Insurance Carrier Requirements for Notifying the Division of Insurance
Coverage).7
Neither party has addressed the fact that, under various Administrative Code 7
provisions, Everest Premier Insurance Company, which issued the SUEZ Policy, could have notified TDI about the companies—SUEZ North America Inc. and Odle among them—for which it provided workers’ compensation insurance coverage.
16 Chapter 415 of the Labor Code governs administrative violations by employers,
insurance carriers, and employees, among others. See Tex. Lab. Code Ann.
§§ 415.001–.008. “A reference in [the Labor Code] or other law . . . to a particular
class of violation, administrative violation, or penalty shall be construed as a reference
to an administrative penalty,” which may not exceed $25,000 per day per occurrence;
each day of noncompliance constitutes a separate violation. Id. § 415.025.
The administrative-violation scheme is part of the legislature’s overarching
framework to implement the workers’ compensation system’s goals. See id.
§ 402.021(a)(1)–(4). In implementing these goals, the legislature has expressed its
intent that the state workers’ compensation system “promptly detect and
appropriately address acts or practices of noncompliance with [the TWCA] and rules
adopted” thereunder. Id. § 402.021(b)(7); see Ruttiger, 381 S.W.3d at 442 (“A carrier’s
failure to comply with the Act’s requirements, deadlines, and procedures is not
without consequences . . . . provid[ing, among other things] that a carrier or its
representative commits an administrative violation for any of twenty-two specified
actions . . . .”).
“The original creation of, continued existence of, and amendments to update
and improve the workers’ compensation system are within the [l]egislative function of
establishing public policy.” Ruttiger, 381 S.W.3d at 450. A “key” part of the system
includes “the penalties imposed for failing to comply with legislatively mandated rules,
and the procedures for imposing such penalties.” Id.; see In re Accident Fund Gen. Ins.
17 Co., 543 S.W.3d 750, 754 (Tex. 2017) (orig. proceeding) (“[DWC] is charged with
ensuring all system participants, including carriers, comply with the rules, and when
participants abuse the process, administrative penalties are available.”).8
An employer commits an administrative violation if, among other things, it
does not notify DWC in writing on the agency-prescribed forms that it has elected not
to obtain coverage, Tex. Lab. Code Ann. § 406.004(a)–(b), (e), or if it does not notify
each employee about whether it has workers’ compensation insurance coverage, id.
§ 406.005(a)–(e). See also id. § 408.063(a)–(c) (failing to timely file wage statement after
notice of injury), § 409.006(a)–(c), (e) (failing to comply with injury record-keeping
requirements), § 411.032 (failing to meet certain reporting requirements).
Likewise, a workers’ compensation insurer may commit a variety of
administrative violations, including failure to timely file notice of coverage and claim
administration contact information with DWC, see id. § 406.006(a)–(c), failure to
provide claims service as required by the TWCA or to designate a representative to act
as its agent before DWC, see id. §§ 406.010(a)–(b), (d), .011(a)–(b), or failure to
maintain or provide TWCA’s required accident prevention services or to use those
services in a reasonable manner to prevent injury to its policyholders’ employees, see
In addition to insurers and employers, administrative violations apply to 8
general contractors, see Tex. Lab. Code Ann. § 406.123(g), self-insurers, see id. §§ 407.067, .082, .104, and health care providers, see id. § 413.042. And any party may commit an administrative violation during the adjudication of disputes between the employee, employer, or insurer. See id. §§ 410.028(c), .112–.113, .156, .208(e).
18 id. § 411.068. See also id. §§ 409.021(a), (e), .022(c), .023(a), (c), .024(a)–(b) (addressing
administrative violations relating to benefits payments). The TWCA also “provides
the exclusive procedures and remedies for claims alleging that a workers’
compensation carrier has improperly investigated, handled, or settled a worker[’s]
claim for benefits.” Accident Fund Gen. Ins. Co., 543 S.W.3d at 752.
Both employers and insurers commit an administrative violation if they fail to
identify or confirm coverage status and claim administration contact information.
Tex. Lab. Code Ann. § 406.009(d)–(e). All the administrative violations pertaining to
coverage elections are subject to Labor Code Chapter 415’s administrative penalties.
Id. § 406.012. The Labor Code also sets out some criminal penalties, including a Class
A misdemeanor or state jail felony for fraudulently obtaining workers’ compensation
insurance coverage. Id. § 418.002 (stating offense is a misdemeanor if the premium
avoided is less than $2,500 and a state jail felony if the premium avoided is $2,500 or
more); see id. §§ 411.034(a)–(d), .105, 413.043(a)–(b) (other misdemeanor offenses),
§ 414.006(a) (providing that DWC may refer cases to other agencies for further
investigation or institution of appropriate proceedings).
Unless otherwise stated, no Labor Code administrative violations and penalties
provide a private cause of action, and allowing parties to pursue remedies that
circumvent DWC’s exclusive procedures and remedies in the first instance “would
undermine the workers’ compensation system’s careful benefits-determination and
claims-resolution processes.” Mouton v. Houston ISD, No. 01-22-00205-CV, 2023 WL
19 4065602, at *6 (Tex. App.—Houston [1st Dist.] June 20, 2023, pet. denied) (mem.
op.) (citing Accident Fund Gen. Ins. Co., 543 S.W.3d at 753).
DWC may seek sanctions when an insurer fails to accurately pay benefits and
fails to timely or accurately report claim data. Tex. Pol. Subdivisions Joint Self-Ins. Fund,
681 S.W.3d at 493–94; see also In re Old Republic Risk Mgmt., No. 12-19-00144-CV, 2019
WL 2462486, at *3 (Tex. App.—Tyler June 12, 2019, orig. proceeding) (mem. op.)
(“For claims arising out of the claims-settlement process, [the TWCA,] with its
definitions, detailed procedures, and dispute resolution process, demonstrates
legislative intent for there to be no alternative remedies.”). That is, the workers’
compensation system “creates a level of certainty for employees by ensuring that an
employer’s violation of the State’s various administrative rules and regulations will not
deprive workers of the benefits under the system,” and the administrative and civil
penalties will not cause a company to forfeit its “subscriber” status. Exxonmobil Corp.
v. Kirkendall, 151 S.W.3d 594, 601 (Tex. App.—San Antonio 2004, pet. denied) (op. on
reh’g).
As potentially applicable here, “[a] person commits an administrative violation
if the person . . . intentionally and knowingly obtains or maintains: . . . workers’
compensation insurance from an insurer that is not authorized to engage in business
in this state.” Tex. Ins. Code Ann. § 2051.152(a)(2)(A). The penalty attached to this
administrative violation is “not to exceed $5,000,” and each day such an
administrative violation occurs or continues is a separate violation. Id. § 2051.152(b)–
20 (c). Nothing in the record shows that Lane has requested the initiation of
administrative-violation proceedings as to Odle or its insurer. Cf. Tex. Lab. Code
Ann. § 415.031 (“Any person may request the initiation of administrative violation
proceedings by filing a written allegation with [DWC].”).
Some of our sister courts have addressed the interplay between administrative
violations and the TWCA’s employer protections. See Becon Constr. Co. v. Alonso,
444 S.W.3d 824, 833 (Tex. App.—Beaumont 2014, pet. denied); Hand & Wrist Ctr. of
Hous., P.A. v. SGS Control Servs., Inc., 409 S.W.3d 743, 751 (Tex. App.—Houston [1st
Dist.] 2013, no pet.). Specifically, committing an administrative violation does not
affect an employer’s ability to satisfy the employer element of the exclusive-remedy
defense. See Berry Contracting, L.P. v. Mann, 549 S.W.3d 314, 324 (Tex. App.—Corpus
Christi–Edinburg 2018, pet. denied) (holding that Section 406.123(f)’s requirement
that a general contractor file a coverage agreement with a workers’ compensation
insurance carrier—the failure of which constituted an administrative violation—did
not affect its ability to satisfy the exclusive-remedy’s employer element).
In Becon, the employees argued that because the general workplace plan had not
complied with certain TDI administrative rules, their employers could not rely on
TWCA’s exclusive-remedy defense. 444 S.W.3d at 833. The employers replied that
TDI’s administrative rules were directory, not mandatory, and that TDI had not
created an administrative penalty stripping entities of the exclusive-remedy defense
provided by the legislature in the TWCA for violation of the regulations. Id. The
21 court observed that because neither the TWCA nor the administrative rules described
a penalty for violating those rules, the employees’ interpretation would discourage
employer participation in the workers’ compensation scheme and “might prevent
some employees who would otherwise be covered by insurance from being covered
under these types of policies due to the violation of regulations.” Id. The court
concluded that the proper penalty for those administrative violations should be left to
TDI when it did not appear “that the [l]egislature intended for these types of
violations to strip employers of defenses or to cause employees to lose the benefits of
their coverage.” Id.; see ExxonMobil Corp. v. Alvarez, No. 14-22-00863-CV, 2024 WL
847701, at *8 (Tex. App.—Houston [14th Dist.] Feb. 29, 2024, no pet.) (mem. op.)
(relying on Becon for same proposition).
In Hand & Wrist Center, a medical-provider case, the court noted that Labor
Code Section 409.005, which required an employer to notify its insurance carrier of
employee injuries requiring absence from work for more than one day, did “not
provide that if the employer fails to comply it has forfeited its protections under the
[TWCA].” 409 S.W.3d at 750. Instead, such a failure is an administrative violation
that allows DWC to assess administrative penalties. Id. at 751 (citing Tex. Lab. Code
Ann. § 409.005(f)). In reaching this conclusion, the court relied on Regalado v. H.E.
Butt Grocery Co., 863 S.W.2d 107, 110 (Tex. App.—San Antonio 1993, no writ), and
Wesby v. Act Pipe & Supply, Inc., 199 S.W.3d 614, 618 (Tex. App.—Dallas 2006, no
pet.), both of which construed an earlier version of the TWCA to conclude that the
22 statutory scheme is not one of waiver when it explicitly provides for noncompliance
penalties. Hand & Wrist Center, 409 S.W.3d at 750–51; see Regalado, 863 S.W.2d at 110
(“We believe the legislature intended to assure compliance with the notice
requirements through the assessment of a fine, not through the harsher penalty of
waiver.”).
C. Application
To prevail on the affirmative defense of Section 408.001(a)’s exclusive remedy,
Odle had to establish that Lane (1) was its employee at the time of the work-related
injury and (2) was covered by its workers’ compensation insurance policy. See Waste
Mgmt. of Tex., Inc., 622 S.W.3d at 277; see also Grant v. Wind Turbine & Energy Cables
Corp., No. 02-21-00036-CV, 2022 WL 2840142, at *9 (Tex. App.—Fort Worth
July 21, 2022, no pet.) (mem. op.) (holding that when the evidence conclusively
established that the plaintiff was an “employee” under the TWCA and that the
company had workers’ compensation coverage, the trial court properly granted
summary judgment for the company).
To support its summary judgment motion on the exclusive-remedy affirmative
defense, Odle attached Lane’s amended original petition in which Lane alleged that he
was Odle’s employee at the time of the work-related injury and attached the affidavit
of Greiner, who averred that Lane had been injured while working for Odle and that
Lane was covered by the SUEZ Policy.
23 In addition to Greiner’s exhibits showing workers’ compensation insurance
coverage that directly referenced Texas and some of Texas’s Labor Code provisions,
as well as providing the contact information for TDI and DWC, Odle attached Lyon’s
affidavit attesting to the benefits Lane had received under the policy. See Tex. R. Civ.
P. 166a(c), (f); Guevara v. WCA Waste Corp., No. 01-15-01075-CV, 2017 WL 1483320,
at *5 (Tex. App.—Houston [1st Dist.] Apr. 25, 2017, pet. dism’d) (mem. op.) (“Waste
Corp. and Gonzales were not required to produce the actual [workers’ compensation]
policy to prove Waste Corp. had coverage; they were permitted to prove Waste
Corp.’s subscriber status with other evidence, such as affidavits.”); Baker v. Cook
Children’s Physician Network, No. 2-07-174-CV, 2008 WL 553712, at *3 (Tex. App.—
Fort Worth Feb. 28, 2008, pet. denied) (mem. op.) (holding affidavit of employer’s
risk-management director, which stated that the company was covered by a workers’
compensation policy when the employee worked for the company, was sufficient to
carry the employer’s burden to establish that it was a workers’ compensation
subscriber); see also Cox v. Waste Mgmt. of Tex., Inc., 300 S.W.3d 424, 428, 440 (Tex.
App.—Fort Worth 2009, pet. denied) (“[T]he evidence submitted by [the employer]
(through an affidavit signed by [its human-resources manager]) establishes that [the
company] carried workers’ compensation insurance during [the plaintiff’s]
employment and that [the plaintiff] was covered under the insurance.”).
This evidence established Odle’s affirmative defense and defeated Lane’s no-
evidence grounds because, to meet the affirmative defense’s elements, Odle did not
24 have to show that the SUEZ Policy had been approved by TDI or that Odle or its
parent company were registered with DWC. See Baker, 2008 WL 553712, at *3; see also
Martinez v. H.B. Zachry Co., 976 S.W.2d 746, 748 (Tex. App.—Houston [1st Dist.]
1998, pet. denied) (holding evidence sufficient to support summary judgment when
company’s claims manager swore in his affidavit that the document attached thereto
was a true and correct copy of the workers’ compensation policy’s information page
and that the policy covered the plaintiff at the time of his accident); see also Webester v.
GSE Lining Tech. LLC, No. 14-16-00841-CV, 2017 WL 6543441, at *7 (Tex. App.—
Houston [14th Dist.] Dec. 21, 2017, pet. denied) (mem. op.) (holding that company’s
affidavit and information page of its workers’ compensation insurance policy for the
relevant time frame were sufficient to establish that the company was a workers’
compensation insurance subscriber).
After Odle established its affirmative defense, the summary judgment burden
shifted to Lane to raise a genuine issue of material fact as to workers’ compensation
coverage. See Grant, 2022 WL 2840142, at *8. Instead of responding to Odle’s
summary judgment motion by attaching evidence to raise a genuine issue of material
fact as to coverage, Lane acknowledged having received the policy’s benefits but—as
noted above—complained that there was no evidence that the policy had been
approved by TDI or that Odle or its parent company had registered with DWC as
workers’ compensation subscribers—neither of which, again—was an element of
Odle’s affirmative defense, and both of which presented only potential administrative
25 violations under the TWCA. See Baker, 2008 WL 553712, at *3 (“Cook’s summary
judgment evidence—Testa’s affidavit—absent controverting summary judgment
evidence, conclusively established Cook’s subscriber status at the time of the incident
at issue.”); see also Warnke v. Nabors Drilling USA, L.P., 358 S.W.3d 338, 343–44 & n.5
(Tex. App.—Houston [1st Dist.] 2011, no pet.) (op. on reh’g) (stating, in a different
statutory-based summary judgment challenge, that “[c]ourts in this state, including this
court, have held that the [Section 408.001(a)] exclusivity bar does not hinge on
whether notice has been provided to the employee” and noting that failure to give
such notice constituted an administrative violation punishable by a fine); Kirkendall,
151 S.W.3d at 600 (“[W]hile Mobil’s plan most likely violates an administrative rule,
nothing in Texas law provides that this violation causes an employer to forfeit its
subscriber status.”).9
9 On appeal, Lane lists several cases to “illustrate the evidence necessary to establish [TDI] approval,” citing Warnke, Kirkendall, and McClelland v. Gronwaldt, No. 09-06-566-CV, 2007 WL 4681509, at *2 (Tex. App.—Beaumont Jan. 10, 2008, pet. denied) (mem. op.). But Lane ignores that under Rule of Civil Procedure 166a(c)¸summary judgment evidence may consist of, among other things, supporting affidavits, and that “[a] summary judgment may be based on uncontroverted testimonial evidence of an interested witness . . . if the evidence is clear, positive and direct, otherwise credible and free from contradictions and inconsistencies, and could have been readily controverted.” Tex. R. Civ. P. 166a(c). Notwithstanding Lane’s evidentiary preferences, Odle’s uncontroverted summary judgment evidence showed a workers’ compensation policy referencing Texas coverage and showing payment of the policy’s benefits to Lane, and Lane brought forth no evidence to raise a genuine fact issue about the policy’s existence, coverage, or validity under Texas law. See McClelland, 2007 WL 4681509, at *3 (pointing out that even if a company’s plan “most likely violates an administrative rule, nothing in Texas law provides that this violation causes an employer to forfeit its subscriber status”).
26 Lane did not challenge Odle’s summary judgment evidence showing that Odle
had provided workers’ compensation insurance to him at the time of the accident or
that he had received benefits from that insurance coverage. See Warnke, 358 S.W.3d at
344;10 see also Martinez, 976 S.W.2d at 748 (“Martinez put on no summary judgment
evidence to show that Zachry was not a subscriber at the time of the accident.”).
Further, Lane searched for the wrong company name on TDI–DWC’s website,
and the evidence that he attached to support the traditional portion of his cross-
motion showed that there was no coverage as to SUEZ WTS USA, INC., not SUEZ
North America Inc., Odle’s parent company, and thereby failed to raise a fact issue as
to Odle’s coverage under the SUEZ Policy.
Because Odle’s uncontroverted summary judgment evidence conclusively
established that Lane was Odle’s employee and that he was covered by Odle’s
workers’ compensation insurance policy at the time of his work-related injuries, the
10 Lane did not challenge Greiner’s affidavit testimony about the SUEZ Policy’s Texas coverage, and such affidavit testimony has been held sufficient to support summary judgment on the TWCA’s exclusive-remedy provision. See Guevara, 2017 WL 1483320, at *5–6 (holding employer satisfied its burden when it presented an affidavit averring to coverage and plaintiff failed to present rebutting evidence); see also Trevino v. Jalapeno Tree Operating, LLC, No. 05-23-00086-CV, 2024 WL 702290, at *2 (Tex. App.—Dallas Feb. 21, 2024, no pet.) (mem. op.) (“The policy listing Jalapeno Tree as an additional insured is sufficient summary judgment proof of workers’ compensation coverage.”); AmeriGas Propane, L.P. v. Aboytes-Muniz, No. 09-18-00122- CV, 2019 WL 2127750, at *8–9 (Tex. App.—Beaumont May 16, 2019, pet. denied) (mem. op.) (holding undisputed evidence of payments to injured worker made under workers’ compensation policy shifted burden to worker to disprove or raise a fact issue on the company’s exclusive-remedy defense).
27 trial court did not err by granting summary judgment for Odle or by denying Lane’s
cross-motion. We overrule both of Lane’s issues without reaching his arguments on
Odle’s election-of-remedies summary judgment ground. See Tex. R. App. P. 47.1.
IV. CONCLUSION
Having overruled both of Lane’s issues, we affirm the trial court’s judgment.
/s/ Dana Womack
Dana Womack Justice
Delivered: August 22, 2024