The Texas Supreme Court recently issued its landmark opinion in the rehearing of Texas Mutual Insurance Co. v. Ruttiger, No. 08-0751 (Tex. June 22, 2012).  The opinion was originally issued on August 26, 2011, but was withdrawn after the Court granted the parties’ motion for a rehearing on February 17, 2012.  The full text of the final (June 22, 2012) opinion can be found here.

Five justices, with a sixth concurring, determined that injured employees “may not assert a common-law claim for breach of the duty of good faith and fair dealing against a workers’ compensation carrier.”  The justices further reiterated the conclusions from their original Ruttiger opinion that (i) the Texas Insurance Code does not permit claims for unfair settlement practices to be made against workers’ compensation insurers, but (ii) claims against insurers for allegedly misrepresenting the terms of their insurance policies may still be brought under the Code.  The justices further recognized that causes of action for unconscionable conduct under the Texas Deceptive Trade Practices Act remain viable.  For a detailed recitation of the facts underlying these holdings, please see our earlier article here.

The Ruttiger opinion is a big victory for workers’ compensation carriers in Texas.  These carriers no longer face the prospect of common law bad faith claims and now enjoy greater certainty under the Texas Insurance Code in adjusting and settling workers’ compensation claims.