Sonat asked Judge Hagan to apply Texas law, and Cudd favored Louisiana law. Hagan applied Texas law.
Jurors enforced the indemnity agreement and found that a reasonable settlement would have been $20,719,166.74.
Hagan entered judgment in that amount.
Cudd sent a notice of appeal to the Sixth District in Texarkana, and Lumbermens posted $29 million as security.
Cudd and Sonat then reached an agreement that left Lumbermens on the hook. Cudd waived its argument for Louisiana law, and Sonat dropped its claim against Cudd.
Lumbermens asked the Sixth District to let it intervene and argue for Louisiana law, and the Sixth District turned the insurer down.
Lumbermens sought mandamus relief and the Supreme Court granted it, finding that the agreement might allow Cudd to foist liability for uninsured claims on its insurer.