Completed-Operations Coverage Requires a Pleaded Connection to the Insured’s Work, Not Merely the Accident Site

1. Introduction

This insurance-coverage dispute arose from the February 11, 2021, 130-vehicle pileup on Interstate 35W in Fort Worth, Texas. The resulting lawsuits named numerous defendants, including North Tarrant Infrastructure, L.L.C., Ferrovial Construction US Corporation, and Webber, L.L.C. These companies had performed construction work between 2013 and 2018 on a portion of the highway known as Segment 3A.

Liberty Mutual Fire Insurance Company initially defended the companies under a full reservation of rights. It later sought a declaratory judgment that it owed no duty to defend because the underlying lawsuits did not allege injuries arising from the companies’ covered construction work. Instead, the allegations concerned failures to maintain and operate the highway during winter weather.

The central question was whether allegations that an accident occurred on a roadway built by the insureds potentially implicated completed-operations coverage, even without allegations connecting the injuries to their construction activities. The Fifth Circuit answered no. Importantly, it reached that conclusion while assuming the insureds’ interpretation of the disputed policy language was correct.

2. Summary of the Opinion

The district court granted summary judgment to Liberty Mutual. It interpreted the insurance agreement as covering injuries arising from rebuilding, constructing, and expanding the relevant highway segment, and found no allegations that construction-related acts or omissions caused the underlying injuries.

The Fifth Circuit affirmed on a narrower ground. It declined to resolve the parties’ competing interpretations of the policy’s exclusions and amendments because the insureds could not establish a duty to defend even under their preferred reading.

Applying Texas’s eight-corners rule, the court examined the insurance agreement and the underlying petitions. Although the petitions included the insureds among collectively defined “Roadway Defendants,” their substantive allegations addressed failures to prepare for winter weather, deploy resources, monitor the roadway, and perform ongoing maintenance and operations. They did not allege injuries arising from the insureds’ completed construction work.

The court rejected two alternative theories of coverage:

• Location alone: Allegations that the insureds built Segment 3A and that injuries occurred there did not establish the necessary connection between the injuries and their work.
• Timing alone: An asserted ten-year coverage period did not independently trigger coverage. The injuries still had to fall within the “products-completed operations hazard,” including its requirement that they arise out of the insureds’ work.

The decision therefore sustained Liberty Mutual’s position on the duty to defend without adopting the district court’s precise interpretation of the exclusionary language.

3. Precedents and Authorities Cited

Ford Motor Co. v. Tex. Dep't of Transp.

Ford Motor Co. v. Tex. Dep't of Transp., 264 F.3d 493, 498 (5th Cir. 2001), supplied the standard of appellate review: summary judgment is reviewed de novo, using the same Rule 56 standard as the district court. Under Federal Rule of Civil Procedure 56(a), judgment is appropriate when no genuine dispute of material fact exists and the moving party is entitled to judgment as a matter of law.

This standard allowed the Fifth Circuit to evaluate the coverage question independently. Its agreement with the ultimate judgment did not require agreement with every aspect of the district court’s reasoning.

Edwards Co. v. Monogram Indus., Inc.

Edwards Co. v. Monogram Indus., Inc., 730 F.2d 977, 979 n.5 (5th Cir. 1984), supported applying Texas law where the parties had briefed and argued the dispute on that basis. The citation established the governing legal framework without requiring an extended choice-of-law discussion.

Gore Design Completions, Ltd. v. Hartford Fire Ins. Co.

Gore Design Completions, Ltd. v. Hartford Fire Ins. Co., 538 F.3d 365, 368 (5th Cir. 2008), supplied the court’s statement of Texas’s eight-corners rule. Under that rule, the duty to defend is determined from the policy’s terms and the third-party claimant’s pleadings.

This authority directed the court toward the allegations actually made against the insureds, rather than hypothetical construction defects that might have explained the accident but were not pleaded.

GuideOne Elite Ins. Co. v. Fielder Rd. Baptist Church

GuideOne Elite Ins. Co. v. Fielder Rd. Baptist Church, 197 S.W.3d 305, 307 (Tex. 2006), was the Texas Supreme Court authority quoted through Gore Design Completions, Ltd. v. Hartford Fire Ins. Co. for the eight-corners rule. Its significance was foundational: the Fifth Circuit’s analysis rested on the state supreme court’s description of the insurer’s defense obligation.

The opinion did not address an exception permitting consideration of outside evidence. Its reasoning remained focused on comparing the petitions with the policy.

Liberty Mut. Ins. Co. v. Graham

Liberty Mut. Ins. Co. v. Graham, 473 F.3d 596, 600 (5th Cir. 2006), established that a duty to defend arises when the petition alleges facts stating a claim that potentially falls within the policy’s coverage.

This potential-coverage standard is important because an insured need not prove the underlying plaintiff’s allegations to obtain a defense. Nevertheless, the allegations must describe a potentially covered injury. The Fifth Circuit found that threshold unmet: the petitions described operational failures, not injuries connected to completed construction.

Buchholz v. Crestbrook Ins. Co.

Buchholz v. Crestbrook Ins. Co., 65 F.4th 766, 769–71 (5th Cir. 2023), performed two roles in the opinion.

First, it addressed the sequence of coverage analysis. The insured must initially establish that the claimed loss falls within the policy’s coverage; exclusions are considered afterward. The defendants invoked this framework to criticize the district court’s approach. The Fifth Circuit concluded that the framework instead defeated their position at the initial step: no allegations fell within the relevant coverage grant, even as the defendants interpreted it.

Second, Buchholz v. Crestbrook Ins. Co. supported affirmance on any ground supported by the appellate record. This permitted the court to uphold the judgment without deciding whether the district court correctly construed the disputed exclusions.

Lancer Ins. Co. v. Garcia Holiday Tours

Lancer Ins. Co. v. Garcia Holiday Tours, 345 S.W.3d 50, 57–58 (Tex. 2011), supplied the central causation analogy. In the automobile-insurance context, that decision rejected coverage where an injury-producing event occurred only incidentally within the location of a motor vehicle.

The Fifth Circuit applied the same distinction between a causal connection and a mere location. Segment 3A was the place where the accident happened, but the petitions did not connect the injuries to the insureds’ construction work. The connection was therefore too remote to invoke coverage. The court did not require proof of causation at the defense stage; it found no pleaded connection sufficient to create potential coverage.

The Underlying Petitions: Not Precedential Decisions

The opinion also identified Vardy v. New Prime, Inc., Case No. DC-21-09849, and Gerred v. Fed Ex Ground Package Sys. Inc., Case No. 352-327055-21. These were examples of the underlying lawsuits, not precedents establishing legal rules.

Their significance lay in their allegations. Read in context, they attributed the accident to failures in roadway operation, maintenance, weather preparation, resource deployment, and monitoring—not to the insureds’ earlier construction activities.

4. Legal Reasoning

A. The Court Assumed the Insureds’ Policy Interpretation

The parties disputed how the policy’s exclusions and amendments interacted. The defendants maintained that the agreement covered injuries arising from their completed work on Segment 3A and excluded completed work only when associated with other projects.

Rather than resolve that contractual dispute, the court assumed the defendants were correct and asked whether the petitions implicated coverage on that understanding. Because they did not, interpreting the disputed exclusions would not change the result.

This approach limits the holding. The opinion does not authoritatively resolve the contested policy wording or endorse every aspect of the district court’s interpretation.

B. Collective Labels Did Not Supply Missing Construction Allegations

The petitions grouped the defendants with other entities under the label “Roadway Defendants.” But the court examined what those defendants allegedly did wrong. The pleaded failures involved operating and maintaining the road during winter conditions.

Inclusion in a broadly defined defendant group did not itself transform those operational allegations into construction-related claims. The insureds also conceded that ongoing maintenance-and-operations allegations were outside the completed-operations hazard covered by the policy language.

The court emphasized that the insureds had completed their work years earlier and had no role in the day-to-day maintenance at issue. The essential coverage deficiency, however, was the absence of allegations connecting the injuries to their completed work—not simply the passage of time.

C. “Arising Out Of” Requires More Than Geographic Coincidence

The defendants argued that two allegations together were sufficient: they built Segment 3A, and bodily injuries occurred on Segment 3A. The court rejected that reasoning.

A location-based connection does not necessarily establish that an injury arose out of the work that created the location. Otherwise, completed-operations insurance could become protection against any later accident at a completed project, regardless of the pleaded cause.

The distinction is particularly important here because completed-operations coverage concerns work that has already been finished. The opinion does not hold that injuries occurring years after completion are categorically uncovered. It holds that the petitions must allege a connection to the completed work rather than merely identify the project as the accident site.

D. A Coverage Period Does Not Replace a Coverage Requirement

On reply, the defendants argued that allegations of bodily injury or property damage within ten years of the policy period or completion of their work were sufficient. The court rejected this formulation because it omitted the substantive limitation governing the extended protection.

The ten-year provision applied to injuries within the products-completed operations hazard. Thus, satisfying an asserted time requirement could not dispense with the requirement that the injury arise from the insureds’ work. Temporal eligibility and substantive coverage were separate questions.

E. Initial Coverage Remained the Threshold Issue

The defendants also asserted that Liberty Mutual had never disputed that the allegations fell within the policy’s initial coverage. The court nevertheless applied the threshold inquiry the defendants themselves urged under Buchholz v. Crestbrook Ins. Co..

Because the pleaded allegations did not satisfy that initial inquiry, the court could affirm without deciding the exclusion issue. Its analysis illustrates why a dispute about exclusions cannot substitute for identifying allegations within the coverage grant in the first place.

5. Potential Impact and Limits

Implications for Construction-Coverage Disputes

The opinion provides a useful framework for distinguishing completed-construction claims from later operational claims. Courts confronting accidents at completed infrastructure projects may examine whether the alleged injury is connected to the insured contractor’s work or merely occurred at the project.

It also highlights the significance of factual pleading. General references to a contractor’s involvement in a project, or its inclusion within a collective defendant label, may not establish potential coverage when the alleged misconduct concerns a different activity.

Implications for Policy Analysis

The decision reinforces a disciplined sequence: identify potentially covered allegations before resolving whether exclusions remove coverage. It also illustrates how a court may avoid difficult policy-construction questions when the insured loses even under its own interpretation.

For extended completed-operations provisions, the opinion underscores that the duration of protection does not enlarge the category of covered risks. A longer coverage period is not an independent promise to cover every injury at a completed project.

Limits on the Decision’s Reach

• Unpublished status: The opinion was not designated for publication under Fifth Circuit Rule 47.5. It should not be presented as a new, generally binding published precedent.
• Unresolved policy language: The court did not settle the parties’ competing readings of the exclusions and amendments.
• Pleading-specific result: Different allegations connecting an injury to completed construction could require a different analysis.
• Defense rather than indemnity: The issue decided was Liberty Mutual’s duty to defend, not an independent determination of its ultimate obligation to pay a judgment.
• No tort-liability adjudication: The decision did not determine who caused the pileup or whether any defendant was liable to the underlying plaintiffs.

6. Complex Concepts Simplified

Duty to defend

The insurer’s obligation to provide a legal defense when the lawsuit’s allegations potentially fall within the policy, even if those allegations ultimately prove untrue.

Eight-corners rule

A comparison of two documents—the insurance policy and the claimant’s pleading—to determine whether a defense is owed.

Products-completed operations hazard

A policy-defined category concerning certain injuries connected to products or work after completion. Here, the relevant requirement was that the injury arise from the insureds’ work.

“Arising out of”

Language requiring a connection between the injury and the covered activity. In this case, sharing the same location was insufficient.

Mere situs

The place where an accident happened, without a sufficient connection between the accident and the insured activity.

Reservation of rights

Notice that an insurer is providing a defense while preserving its ability to contest coverage.

De novo review

Independent appellate review of the legal question, without deference to the district court’s legal conclusions.

7. Conclusion

The Fifth Circuit’s central distinction was between an accident occurring at an insured’s completed project and an injury allegedly arising from the insured’s work. Only the former connection appeared in the petitions.

Accordingly, Liberty Mutual owed no duty to defend under even the defendants’ proposed policy interpretation. The opinion’s significance lies in its focused application of existing Texas coverage principles: allegations must potentially satisfy the coverage grant, geographic coincidence is insufficient, and an extended coverage period cannot replace a missing connection to covered work.