                 UNITED STATES COURT OF APPEALS
                      For the Fifth Circuit



                           No. 99-31150



                 CYNTHIA ROBERTS, Etc., ET AL.,

                                                       Plaintiffs,

                              VERSUS

                 ENERGY DEVELOPMENT CORPORATION;
               GRASSO PRODUCTION MANAGEMENT, INC.,

                 Defendants - Third Party Plaintiffs - Appellees,


                              VERSUS


                   THE GRAY INSURANCE COMPANY,

                                Third-Party Defendant - Appellant.




          Appeal from the United States District Court
              For the Eastern District of Louisiana
                         December 13, 2000
Before DUHÉ, EMILIO M. GARZA, and DeMOSS, Circuit Judges.

DeMOSS, Circuit Judge:

     In this appeal, Third-Party Defendant-Appellant Gray Insurance

Company (“Gray”) appeals from an adverse summary judgment entered

against it in an insurance indemnification dispute among various

insurance defendants.    The underlying claim giving rise to an

insurance payment obligation was the death of Kerry Roberts, who
died when he fell through the top of an oil storage tank which he

was repairing.       Surviving family members sued both the owner and

the production operator of the storage tank, Energy Development

Corporation    (“EDC”),     and    Grasso   Production   Management,   Inc.

(“Grasso”), respectively.         These defendants then filed third-party

complaints    against     Roberts’s    employer,   Production   Management

Control Systems (“PMCS”) and its insurance company, The Gray

Insurance Company (“Gray”), seeking indemnity pursuant to the

master service agreement between PMCS and EDC.            For the reasons

discussed below, we reverse the district court’s order granting

summary judgment in favor of EDC and Grasso.



                I.    FACTUAL AND PROCEDURAL BACKGROUND

     Kerry Roberts, an employee of PMCS, was killed installing a

fire protection device on the top of an oil storage tank owned by

EDC when the top of the storage tank collapsed and he fell through

and ultimately drowned in the oil stored therein. Roberts was sent

to the storage tank by EDC and Grasso, both of which had prior

knowledge that the top of the storage tank might be defective since

only months prior, a Grasso employee’s knee had gone through the

top of a companion storage tank.            The storage tank at issue was

located on EDC’s E-5 platform facility in a canal in West Delta

Block 83, which is located in Plaquemines Parish, Louisiana.           EDC




                                       2
classifies its E-5 platform as an offshore facility but the West

Delta Block 83 facility is located in waters within the State of

Louisiana.

     PMCS limits its services to performing work such as the

installation, repair, and testing of safety systems on oil and gas

production platforms.     The work done on April 29, 1994, the day of

the accident, was performed pursuant to a verbal work order issued

four days earlier for the installation of a fire safety device on

the E-5 tank and platform.     The work order was issued from the EDC

facility in Plaquemines, Louisiana.

     EDC and PMCS had previously entered into a form master service

agreement (“MSA”) on May 7, 1993, which agreement was prepared by

EDC and was quite similar to the MSA entered into by EDC and

Grasso.    The MSA did not bind EDC to perform any work at all for

PMCS and did not identify specific dates, time, or places for

performance.     The MSA did, though, contain an indemnity provision

which required PMCS to carry $1 million in general liability

coverage   and    to   designate   EDC   and   EDC’s   subcontractors   as

additional insureds.     The form MSA also contained a choice of law

provision, which provided as follows:

           This Contract shall be governed by General Maritime
           Law of the United States, wherever permissible.
           Otherwise, the laws of the State of Texas shall
           apply, excluding, however, any such law which would
           direct the application of the law of a different
           jurisdiction.

     PMCS is a Louisiana corporation domiciled in Louisiana and EDC


                                     3
is a New Jersey corporation with corporate offices in Ardmore,

Oklahoma.    The record reveals that most of the work performed by

PMCS was done in Louisiana or in her waters, and a very small

portion was performed at a facility in the Outer Continental Shelf

in the non-territorial waters offshore of Texas, but none was

performed in either Texas or her territorial waters.

     The    insurance   provisions   of   both   the   EDC/PMCS   and    the

EDC/Grasso MSAs required the contractee’s general comprehensive

liability policy to provide that EDC be covered as an additional

insured under the policy.        Each of these entities had general

liability policies as follows: PMCS had a $1 million primary policy

and a $5 million excess policy, both issued by Gray; EDC’s primary

policy was issued by Lloyd’s for $250,000; and Grasso’s primary

policy was issued by Lloyd’s for $250,000 and it carried an excess

policy in the amount of $750,000, also issued by Lloyd’s.               Both

PMCS’s and Grasso’s excess policies provide that any entity insured

under the primary policy is also covered under the excess policy.

Undisputedly, each      primary policy also contains a provision that

a party becomes an additional insured when that status is required

by any contract with the named insured.          An “endorsement” on the

Gray primary policy also contains a schedule of companies to whom

primary coverage is to apply.     Neither EDC nor Grasso is listed as

one of the 27 in the schedule to whom the endorsement explicitly

refers.



                                     4
     When the Roberts family sued EDC and Grasso for the death of

Kerry Roberts, EDC and Grasso filed third-party complaints against

PMCS and its insurer, Gray, for MSA contractual indemnification.

PMCS denied the third-party claims and asserted in the alternative

that if indemnity was owed EDC, it was to be shared with Grasso,

and that if additional insured status was declared, it would be

shared with EDC’s and Grasso’s insurers.

     The federal district court originally granted summary judgment

to PMCS and Gray based on the Louisiana Oilfield Indemnity Act

(“LOIA”), La. Rev. Stat. 9:2780, and dismissed EDC’s and Grasso’s

third-party complaints. EDC and Grasso then settled the underlying

claims of the Roberts family against them, with EDC paying the

family $544,300 and Grasso paying $816,833.75. EDC and Grasso then

appealed the district court’s dismissal of their third-party claims

against PMCS and Gray.

     In Roberts v. Energy Development Corp., 104 F.3d 782 (5th Cir.

1997), a prior panel of our Court affirmed the district court’s

finding that the contract at issue “pertained to a well” and that

the LOIA would bar EDC’s and Grasso’s claims, but it remanded to

the district court for reconsideration of the district court’s

determination regarding the choice of law provision in the MSA.

Specifically, the prior panel remanded for a consideration of

whether the LOIA rendered unenforceable the agreement’s choice of

law provision. The prior panel observed that, in a diversity case,



                                5
the   forum    state’s    conflict    laws     govern    resolution       of   the

enforceability of a choice of law provision, and thus, it remanded

for consideration of the viability of the agreement’s choice of law

provisions in light of Louisiana’s conflict articles, La. Civ. Code

arts. 3540, 3537, and 3515.         See Roberts, 104 F.3d at 786-87.

      On remand, the district court concluded that the choice of law

provision in the MSA, selecting Texas law, was enforceable and that

as a result, the LOIA did not apply.              The district court also

concluded that while a contractual indemnity clause is otherwise

barred by the Texas Oilfield Anti-Indemnity Act (“TOAIA”), Tex.

Civ. Prac. & Rem. Code §§ 127.001-127.007 (Vernon Supp. 1996), an

“additional insured requirement,” like that found in the MSA at

issue in this case, does not violate the TOAIA and is valid and

enforceable.     The court went on to conclude that Grasso’s policy

would not     provide    coverage    because   Roberts    was   not   a    Grasso

employee.     Additionally, the district court ruled that EDC and

Grasso would share equally the reimbursement from the $1 million

Gray primary policy, that EDC’s primary policy would absorb the

shortfall after receiving the $500,000 from Gray, and that since

Grasso’s primary policy had been exhausted by prior claims, Gray’s

excess policy was to cover the additional liability amount of

$316,833.75, which was beyond the $500,000 Grasso would receive

from Gray’s primary policy.         All told, Gray was ordered to pay EDC

$500,000 and to pay Grasso $816,833.75.



                                       6
     Gray has now timely appealed all adverse rulings made against

it by the district court.



                                 II.   DISCUSSION

A.   Standard of Review

     We review the grant of summary judgment de novo, applying all

of the same standards applicable in the district court.                         See

Sherrod v. American Airlines, Inc., 132 F.3d 1112, 1119 (5th Cir.

1998).   Summary judgment under Rule 56 of the Federal Rules of

Civil Procedure is appropriate only if

             . . . the pleadings, depositions, answers to
             interrogatories, and admissions on file, together
             with the affidavits, if any, show that there is no
             genuine issue as to any material fact and that the
             moving party is entitled to judgment as a matter of
             law.

Fed.R.Civ.P. 56(c).

     Here,      the   material     facts       are   not   in   dispute   and   our

disposition hinges on the application of the undisputed facts to

the law determined applicable.                 It is not disputed that should

Louisiana law be determined applicable pursuant to the Louisiana

conflicts articles, the LOIA would bar any claims against Gray by

EDC and Grasso for contribution or indemnity.

B.   Analysis

     Pursuant to our prior panel’s remand, the district court first

set about to reconsider whether the choice of law provision in the

MSA between PMCS and EDC, which provision selected Texas law as

                                           7
applying except         for   those    such     laws   “which   would   direct   the

application        of   the   law     of    a   different   jurisdiction,”       was

enforceable in light of the LOIA.                Pursuant to the remand order,

the district court analyzed the enforceability of the choice of law

provision under Louisiana’s conflicts articles. The district court

noted that the decision upon which it had previously relied in

determining that Louisiana law governed the dispute, that is Matte

v.       Zapata   Offshore    Co.,    784   F.2d   628   (5th   Cir.    1986),   was

inapplicable, as noted in the prior panel’s remand order, because

the holding in Matte resulted from the fact that the application of

Louisiana law in that case was mandated by the applicability of the

Outer Continental Shelf Lands Act (“OCSLA”), which Act the district

court concluded is inapplicable to this case because the accident

at issue occurred in Louisiana state waters and not on the Outer

Continental Shelf.1

          The district court, therefore, turned to an application of

Louisiana’s conflicts articles to determine whether the parties’

choice of law provision was enforceable. The provisions applicable

to the choice of law provision in this case are Articles 3540,

3537, and 3515 of the Louisiana Civil Code.                     We explained the


     1
      However, the district court failed to recognize that in
addition to concluding that the OCSLA required application of
Louisiana law, the Matte panel stated that the choice of law
provision in that case was also invalidated by the fact that it
would have violated the public policy of Louisiana, which state’s
law would presumably have been otherwise applicable. See Matte,
784 F.2d at 631.

                                            8
relevant inquiry under Louisiana law in Roberts as follows:

          Under the Louisiana conflicts articles, we look
          first to Article 3540 which states:

               All   other   issues    of   conventional
               obligations are governed by the law
               expressly chosen or clearly relied upon
               by the parties, except to the extent that
               law contravenes the public policy of the
               state whose law would otherwise be
               applicable under Article 3537.

          La. Civ. Code art. 3540.

          Thus, we next turn to Article 3537 to determine
          which state law would otherwise be applicable to
          the Agreement. Article 3537 states:

               Except as otherwise provided in this
               Title,   an   issue    of   conventional
               obligation is governed by the law of the
               state whose policies would be most
               seriously impaired if its law were not
               applied to that issue.

               That state is determined by evaluating
               the strength and pertinence of the
               relevant polices of the involved state in
               light of: (1) the pertinent contacts of
               each state to the parties and the
               transaction, including the place of
               negotiation, formation and performance of
               the contract, the location of the object
               of the contract, and the place of
               domicile, habitual residence, or business
               of the parties;    (2) the nature, type,
               and purpose of the contract; and (3) the
               polices referred to in Article 3515, as
               well as the policies of facilitating the
               orderly planning of transactions, of
               promoting     multistate      commercial
               intercourse, and of protecting one party
               from undue imposition by the other.

          La. Civ. Code art. 3537.

          Article 3515 guides us in balancing the policies of

                                9
          the states:

               Except as otherwise provided in this
               Book, an issue in a case having contacts
               with other states is governed by the law
               of the state whose policies would be most
               seriously impaired if its law were not
               applied to that issue.

               That state is determined by evaluating
               the strength and pertinence of the
               relevant policies of all involved states
               in the light of: (1) the relationship of
               each state to the parties and the
               dispute; and (2) the policies and needs
               of the interstate and international
               system,   including  the   policies   of
               upholding the justified expectations of
               parties and of minimizing the adverse
               consequences that might follow from
               subjecting a party to the law of more
               than one state.

          La. Civ. Code art. 3515.

          The Revision Comments to Articles 3515 and 3537
          provide helpful instructions to courts using these
          articles.    The Comments      emphasize that the
          objective of the choice of law analysis is to
          "identify 'the state whose policies would be most
          seriously impaired if its law is not applied to
          that issue.'" La.C.C. art. 3515 (1991 revision
          comments (a)).   The Comments to Article 3537 list
          two steps to follow in making this determination.
          The first is to identify "'the relevant policies of
          the involved states.'"      The next step is to
          evaluate "'the strength and pertinence of [these]
          policies' in light of" the three factors listed in
          the second paragraph of Article 3537. La.C.C. art.
          3537 (revision comments 1991 (d)).

Roberts, 104 F.3d at 786-87.

     In simplest terms, we must first determine which state’s law

would be otherwise applicable in the absence of the choice of law

provision. We then determine whether application of the chosen law

                               10
would contravene the otherwise applicable state’s public policy.

Our overall objective is to determine the state whose policies

would be more seriously impaired if its law was not applied, and

this is done by comparing the strength and pertinence of the

competing states’ policies in light of the various factors set

forth in Article 3537.

     In its assessment of the conflicts articles, the district

court concluded that Louisiana’s explicit “public policy” against

indemnity agreements stated in the LOIA, though strong, was but one

of many other factors which guided its decision, and the other

factors weighed more heavily in favor of selecting Texas as the

appropriate law to govern. The district court concluded that Texas

law would otherwise be applicable under Article 3537, and as a

consequence, the application of Texas law would not offend any

Texas public policy.     In making its determination that Texas law

would be otherwise applicable under Article 3537, the district

court relied on the following factors: (1) both EDC and PMCS had

significant contacts with Texas; (2) EDC has its principal place of

business in Houston and PMCS maintains a Houston operations office

to which all correspondence regarding the MSA was to be sent;

(3) the parties contemplated that work orders would be performed in

both Louisiana and Texas; (4) the choice of law provision was

bargained for by the parties; (5) additional policies of Louisiana

encourage the facilitating of multi-state ventures; and (6) the

location of the accident was not dispositive.    The district court

                                 11
also relied on what it perceived as our implicit recognition of the

propriety of selecting Texas law over that of Louisiana based on

application of the Louisiana conflicts provisions and in spite of

the LOIA in Americas Ins. v. Apache Corp., No.95-31296 (5th Cir.

August 12, 1996) (per curiam) (unpublished).2             Citing to our

unpublished decision in Americas, the district court thus concluded

that “there is no doubt that Texas law should apply to the

underlying agreement between PMCS and EDC.”

      Gray argues on appeal that the primary inquiry required by

Article 3540 is whether application of the chosen state’s law would

“contravene[] the public policy of the state whose law would

otherwise   be   applicable   under    Article   3537.”    Arguing   that

Louisiana law would be “otherwise applicable” under Article 3537,

Gray asserts that permitting the indemnity arrangement in this case

would directly contravene the proviso in the LOIA that “it is the

intent of the legislature by this section to declare null and void

and   against    public   policy      of   the   state    of   Louisiana”

indemnification agreements requiring defense and/or indemnification

of at-fault principals with respect to oilfield accidents.            La.

Rev. Stat. 9:2780(A).     In that section, the legislature declared


  2
     We pause here to note that the application of the Louisiana
conflicts articles in Americas involved the consideration of the
fact that both parties to the agreement in question were Texas
entities. The Americas district court noted in its opinion, which
was approved by a panel of our Court, that “Louisiana certainly
does not have an interest in protecting Texas contractors from
entering into agreements with other Texas entities.”

                                   12
that “an inequity is foisted on certain contractors and their

employees by the defense or indemnity provisions, either or both,

contained in some agreements pertaining to wells for oil, gas, or

water . . . .”     Id.

     Gray argues that the public policy of Louisiana is clearly and

unambiguously stated in the LOIA and there is no explicit statement

of the public policy of Texas on any pertinent issue cited by

either the district court or the Appellees. Gray cites to Cherokee

Pump & Equip., Inc. v. Aurora Pump, 38 F.3d 246 (5th Cir. 1994), in

which a panel of our Court noted that unlike the LOIA, the

Louisiana Repurchase Statute at issue in that case did not contain

an explicit embodiment of state public policy.        Gray notes that in

Matte, we stated:

           [t]he public policy of Louisiana is clear, certain,
           and unambiguous. Any provision which purports to
           provide a defense or indemnity to an indemnitee for
           claims of injury or death alleged to have been
           caused by the indemnitee’s negligence . . . is
           ‘void and unenforceable.’

Matte, 784 F.2d at 631.

     It is Gray’s position that considering the factors set forth

in Article 3537, and the relative strengths of the policies of both

Texas and Louisiana, Louisiana has a stronger interest in, and

policy   for,    protecting   its   sub-contractors   like   PMCS,   from

indemnity provisions like the one found in the PMCS/EDC MSA.         Gray

also argues that considering the verbal work order and not the MSA

as the operative agreement even more strongly favors selection of

                                    13
Louisiana, and it points to our prior panel’s statement that “[t]he

oral work order is the relevant agreement for determining this

issue [of whether the agreement pertained to a well].”          Roberts,

104 F.3d at 784.    The oral work order, which originated in and was

conveyed to PMCS in Louisiana, called for work to be performed

solely on well platforms in Plaquemines Parish, Louisiana. We read

Davis & Sons, Inc. v. Gulf Oil Corp., 919 F.2d 313, 315 (5th Cir.

1990) (“if . . . the contract consists of two parts, a blanket

contract followed by later work orders, the two must be interpreted

together     in   evaluating   whether   maritime   or   land   law   is

applicable.”), and Domingue v. Ocean Drilling and Exploration Co.,

923 F.2d 393, 396 (5th Cir. 1991) (“[w]e must read the . . .

blanket agreement modified by the later work order together as the

actual contract.”), to require that we look both to the MSA and the

work order in conducting our conflict analysis.           Article 3537

provides that the governing law is the law of the state whose

“policies would be most seriously impaired if its law were not

applied to that issue,” and that state is determined by weighing

the relative strength and pertinence of the competing states'

policies.3    As Comment (c) to Article 3537 explains, the state


  3
     It is important to note that in Article 3515, the legislature
used a broader reference to the term policies of the states, which
should not be restricted to consideration of stated “public”
policies only. And while we agree with Gray that the Louisiana
legislature has no doubt explicitly stated a public policy against
indemnity agreements in the LOIA, under Article 3515, we cannot
constrain our analysis to consideration of this policy alone.

                                   14
whose   law   should    apply    is   the   state    that    “in    light   of    its

connection to the parties and the transaction and its interests

implicated in the conflict, would bear the most serious legal,

social, economic, and other consequences 'if its law were not

applied' to the issue at hand.”

      The policies which we must balance are Louisiana's anti-

indemnification policy and any countervailing state policies, such

as the policy of upholding contracts freely and voluntarily entered

into by the parties.4           We must evaluate the strength of these

policies in light of (1) the pertinent contacts regarding the

development and formation of the agreement, the location of the

parties, and the location of the performance of the agreement; (2)

the nature and purpose of the agreement; and (3) (a) the policies

and needs of the interstate system, including the policies of

upholding     the    justified   expectations       of     the   parties    and    of

minimizing     the    adverse    consequences       that    might    follow      from

subjecting a party to the law of more than one state                (see La. Civ.

Code art. 3515)5 and (b) the policies of facilitating the orderly

  4
   Comment (d) to Article 3537 states that the “relevant [state]
policies” which must be weighed “are identified through the
resources of the interpretive process by focusing on the specific
rules of substantive contract law whose applicability is being
urged in the particular case.”
  5
   Comment (f) to Article 3537 makes clear that:

  [t]hrough its cross-reference to Article 3515, clause (3) of
  the second paragraph of this Article incorporates by reference
  the list of policies contained therein as well as the analysis
  prescribed by that Article. . . . [The] relative importance

                                       15
planning of   transactions,   of   promoting   multi-state   commercial

intercourse, and of protecting one party from undue imposition by

the other (see La. Civ. Code art. 3537).

     The district court based its conclusion that Texas law “wins

the analysis” primarily on the extent of the parties' contacts with

Texas, the fact that the parties contemplated the possibility that

work orders would be performed in Louisiana and Texas, and the fact

that the choice of law provision was “selected and bargained for”

by the parties. The court briefly mentioned the policies stated in

the conflicts articles regarding the fostering and planning of

transactions and of facilitating multi-state ventures.        However,

the court did little to compare the relative strengths of each

state's respective policies in these regards.

     We note the following specific factors which, pursuant to

Article 3537, guide our comparison of the states' policies.       With

respect to contacts of the parties, the district court noted that

PMCS had “significant” contacts with Texas, but while PMCS does

maintain an office in Houston, Texas, it is in fact incorporated

and performs most of its operations in Louisiana.            Under the

Louisiana conflicts rules, a juridical person may be treated as a

domiciliary of either the state of its formation or the state of

its principal place of business, whichever is more pertinent to the


  [of these polices] will depend on the particular contacts of
  the enacting jurisdiction, the nature, type, and purpose of
  the contract, and the particular issue with regard to which
  there exists an actual conflict.

                                   16
particular issue.   See La. Civ. Code art. 3518.   Under this rule,

PMCS is clearly a domiciliary of Louisiana. EDC is incorporated in

New Jersey, but claims Houston, Texas as its principal place of

business, and it has corporate offices in Oklahoma.     Because we

feel EDC's Texas office is more closely connected to this dispute,

we conclude that it is domiciled in Texas under the Louisiana

conflicts rules.

     The MSA was signed in Texas and PMCS designated one of its

operations offices in Texas for all mailings regarding the MSA in

this case, but the great majority of the work contemplated by the

MSA was to take place in or offshore of Louisiana.      Though the

parties contemplated that work might be performed in waters near

both Louisiana and Texas, in fact, virtually all work performed

under the MSA was performed exclusively in the waters of or

offshore of Louisiana.     And the specific work order at issue in

this case was issued from, to, and in regards to work to be

performed in, Louisiana.   In addition, the accident giving rise to

the insurance obligation occurred in Louisiana, and while this

factor is not dispositive, as the district court acknowledged, it

is most certainly an important factor, especially where, as here,

the sub-contractor whose employee was injured is a Louisiana

domiciliary.




                                 17
       We now turn to the policy stated in Article 3515 of upholding

the justified expectations of the parties, and the policies stated

in     Article    3537     of    facilitating       the    orderly    planning      of

transactions and minimizing the adverse consequences that might

result from subjecting a party to the law of more than one state.

Viewed in light of these policies, the policy stated in the LOIA,

which would invalidate the parties' choice of law provision, loses

some     force    against       the    countervailing      policy     of    upholding

contractual       obligations         freely    entered   into   by   the    parties.

However, with respect to the policy of protecting one party from

undue imposition by the other, Louisiana's commitment to protecting

its sub-contractors from the “inequity” foisted on such entities by

indemnity provisions in work agreements pertaining to wells for oil

and gas, is more emphatic than that of any respective policies of

Texas.      The    force    of    Louisiana's       public   policy        disfavoring

indemnity agreements, as stated in the LOIA, is unquestionably very

strong.      See Matte, 784 F.2d at 631 (“The public policy of

Louisiana is clear, certain, and unambiguous.                Any provision which

attempts to provide a defense of indemnity . . . is void and

unenforceable.”).        The language of the LOIA makes it clear that

Louisiana has a very strong policy against allowing its oil and gas

well sub-contractors to be manipulated by well owners and operators

who would foist the burden of indemnification on them through work

agreements, and subjecting these subcontractors to contrary laws



                                           18
permitting indemnification provisions in other jurisdictions.

     Given that one of the contracting parties in this case, PMCS,

is a Louisiana domiciliary, that PMCS is the type of oil and gas

well sub-contractor for whom the Louisiana legislature specifically

contemplated providing protection with the anti-indemnification

policy announced in the LOIA, that the nature and purpose of the

agreement therefore directly implicate the LOIA policy, that the

work order at issue was generated from and pertained to work to be

performed exclusively in Louisiana, that the parties' history

reveals    that   virtually    all    work      arranged   under   the   MSA   was

performed in or offshore of Louisiana, that no work would have been

performed under the MSA in the territorial waters of Texas, that

the injury giving rise to the underlying insurance obligation

occurred in Louisiana, and considering the policy of protecting one

party from undue imposition by the other, we conclude that the

strength    of    Louisiana's      policy       of   preventing    the   adverse

consequences      which    would     fall     upon   its   sub-contractors     by

application of the laws of Texas tips the scales which might

otherwise be balanced with respect to each state's policies noted

above.     We disagree with the district court’s holding, that our

unpublished,      and     consequently        non-precedential,    decision     in

Americas dictates a contrary result under the Louisiana conflicts

articles.    The Americas decision is easily distinguished by the

fact that it involved two contracting parties, both of which were


                                         19
Texas    entities.    As    the   district      court     noted   in    that    case,

“Louisiana certainly does not have an interest in protecting Texas

contractors    from   entering        into    agreements     with      other    Texas

entities.”    Thus to sum up, our analysis of the relative strengths

of the relevant policies of Texas and Louisiana convinces us that

in the absence of the choice of law provision in the PMCS/EDC MSA,

Louisiana law would be applicable since its policies for protecting

its sub-contractors outweighs any relevant competing policies in

Texas.

      Having determined that Louisiana is the state whose law would

otherwise be applicable under Article 3540, we must now determine

whether application of the law selected in the choice of law

provision, in this case, Texas law, would “contravene the public

policy of” Louisiana.       Our analysis here is brief.                Both parties

have agreed that under Louisiana law, the LOIA would void the

indemnity    provision     in   the    MSA,   and   the    parties      agree   that

application of Texas law permitting indemnification through an

additional insured provision like that found in the MSA at issue in

this case would contravene Louisiana’s explicit and unambiguous

public policy against indemnification agreements in any form.6

  6
     We note here that while, even under Texas law, an indemnity
agreement is unenforceable as violative of the TOAIA, the Texas
Supreme Court has held that additional insured requirements, like
that contained in the PMCS/EDC master service agreement, remain
viable. See Getty Oil Co. v. Insurance Co. of North America, 845
S.W.2d 794, 802-05 (Tex. 1987). On the other hand, the Louisiana
legislature specifically addressed and closed this type of
additional   insured   loophole   to  the   prohibition   against

                                        20
Accordingly, we find that the district court committed reversible



indemnification agreements in subsection G of the LOIA which states
in pertinent part:

       Any provision in any agreement arising out of the
       operations,   services,  or  activities   listed  in
       Subsection C of [the LOIA] . . . which requires
       waivers of subrogation, additional named insured
       endorsements, or any other form of insurance
       protection which would frustrate or circumvent the
       prohibitions of this Section, shall be null and void
       and of no force and effect.

La. Rev. Stat. 9:2780(G)(emphasis supplied).

   Through subsection G, the Louisiana legislature rendered any
attempt to procure otherwise prohibited indemnification, through a
requirement that an oil services contractor name an oilfield owner
or operator as an additional insured under the contractor’s
insurance policies, unenforceable. Indeed, as the Louisiana First
Circuit Court of Appeal recently noted, voiding additional insured
provisions “promote[s] the purpose of the [LOIA] because it will
prevent oil companies from forcing contractors to purchase
contractual indemnity insurance coverage . . . [and insures]
against overreaching by [oilfield service contractors’] customers.”
Amoco Production Co. v. Lexington Ins. Co., 745 So.2d 676, 680 (La.
App. 1st Cir. 1999).

   We note also that our Circuit has recognized an exception to the
LOIA’s prohibition against indemnity agreements and additional
insured provisions where the additional insured principal pays the
portion of the insurance premium incurred by the independent
contractor for adding the additional principal to its policy. See
Marcel v. Placid Oil Co., 11 F.3d 563, 569-70 (5th Cir. 1994).
However, here there is no evidence whatsoever to support
application of the Marcel exception. There is no evidence that EDC
was obligated to pay, or did in fact pay, any portion of PMCS’s
insurance premiums to Gray for the coverage of EDC as an additional
insured. To the contrary, the MSA states in paragraph (4) that
“[PMCS] agrees to procure and maintain, at its sole expense,
policies of insurance in the minimum amount outlined [in] Exhibit
A.”     The referred to Exhibit A sets forth the insurance
requirements which EDC requires of its subcontractors. Paragraph
(7) of that exhibit requires that EDC, its subsidiaries, and its
employees be named as additional insureds.

                                21
error in holding that the choice of law provision in the PMCS/EDC

MSA was enforceable.

     We pause here to briefly address EDC and Grasso’s argument

that a ruling that Louisiana law applies means that this case must

be remanded for trial on the issue of liability.        Although we held

in Tanksley v. Gulf Oil Corp., 848 F.2d 515 (5th Cir. 1988), that

a settlement by indemnitees removes the issue of fault for the

LOIA, EDC and Grasso argue that decision has been rejected by

several Louisiana appellate courts.      Gray responds by noting that

we held in FDIC v. Abraham, 137 F.3d 264 (5th Cir. 1998) that we

should not depart from Fifth Circuit precedent unless the highest

court of the state has ruled on the matter.

     The remaining issues in this appeal regarding the proper

allocation of insurance benefits are moot as a result of our

conclusion   that   the   indemnification   provision   in   the   MSA   is

unenforceable against Gray under Louisiana law.



                            III.   CONCLUSION

     For the reasons set forth above, we find that the district

court erred in finding that the choice of law provision in the

PMCS/EDC MSA was enforceable.        And having determined that the

choice of law provision is unenforceable, and that pursuant to

Louisiana conflicts law, the laws of Louisiana govern this case, we

REVERSE the district court’s order granting EDC and Grasso summary


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judgment, and RENDER judgment in favor of Gray.

          REVERSED and RENDERED.




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