Timber Creek Casualty Insurance, A Risk Retention Group v. Miriam J Castillo Transport, LLC et al

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
CORPUS CHRISTI DIVISION
TIMBER CREEK CASUALTY INSURANCE,
A RISK RETENTION GROUP,
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Plaintiff,
v. Case No. 2:26-CV-00081
MIRIAM J. CASTILLO TRANSPORT, LLC,
et al.,
Defendants.
MEMORANDUM AND RECOMMENDATION OF
UNITED STATES MAGISTRATE JUDGE
A complaint was filed by plaintiff Timber Creek Casualty Insurance, a Risk Retention
Group (“Timber Creek”), seeking a declaration that Timber Creek has no duty to defend or
indemnify defendant Miriam J. Castillo Transport, LLC (“Transport”) in connection with a
pending lawsuit in Texas state court filed by Minnie M. Barrios (“Barrios”), Elda Ramos Garcia
(“Garcia”), and San Juanita Cardenas (“Cardenas”). (Doc. No. 1.)1 The Court granted Timber
Creek’s request to the Clerk for an entry of default pursuant to Federal Rule of Civil Procedure
55(a) because of the defendants’ failure to plead or otherwise defend against Timber Creek’s
complaint. (Doc. No. 18.) Timber Creek now moves for entry of default judgment. (Doc. No.
21.) For the reasons discussed below, the district court should GRANT IN PART Timber
Creek’s motion.
1 Transport, Barrios, Garcia, and Cardenas are the defendants in this declaratory judgment action. Barrios, Garcia,
and Cardenas are named as nominal defendants.
United States District Court
Southern District of Texas
ENTERED
July 28, 2026
Nathan Ochsner, Clerk
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A. Jurisdiction.
Timber Creek, seeking a declaratory judgment, asserts that the Court has diversity
jurisdiction pursuant to 28 U.S.C. § 1332. Timber Creek further contends that an actual
controversy exists as contemplated by 28 U.S.C. § 2201(a). This case has been referred to the
undersigned magistrate judge for case management and recommendations on dispositive matters
pursuant to 28 U.S.C. § 636.
B. Background.
According to Timber Creek’s complaint, a lawsuit is pending in the 343rd Judicial
District Court of San Patricio County, Texas, in which Barrios, Garcia, and Cardenas sued
Transport, David Gonzalez, Anyer Gamez Guedes, and L&L Ag Works, LLC. (Doc. No. 1, pp.
1-2 ¶ 1.) This lawsuit bears case number S-25-5774CV-C and is referred to in this memorandum
as the “Underlying Suit.” Timber Creek has not supplied a copy of the plaintiffs’ petition in the
Underlying Suit, but claims that the Underlying Suit alleges that Barrios, Garcia, and Cardenas
suffered injuries when a tractor-trailer driven by Gonzalez collided with their vehicle. Id. at 3-4
¶¶ 13-17. The incident in question occurred on October 11, 2025. Id. at 3 ¶ 14. Guedes was
allegedly the owner of the tractor, while L&L Ag Works owned the trailer. Id. at 4 ¶ 19.
Although it is not entirely clear from Timber Creek’s complaint, it appears that Transport is
alleged to have been Gonzalez’s employer. See id. ¶ 20. The Underlying Suit, Timber Creek
says, alleges negligence on the part of all of the defendants, including negligent entrustment,
negligent hiring and retention, negligent training, negligent supervision, negligent maintenance
of the vehicle, and violations of the Federal Motor Carrier Safety Regulations. Id. ¶ 21.
Timber Creek alleges that it had issued a business auto insurance policy to Transport,
numbered TCC-TX00098157, which was set to go into effect on July 29, 2025. (Doc. No. 1, p. 5
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¶ 25.) This document is referred to in this memorandum as the “Policy.” The Policy would have
provided coverage for a Freightliner tractor (presumably the vehicle involved in the collision).
Id. Timber Creek alleges, however, that Transport failed to pay the Policy premium, and that
Timber Creek therefore cancelled the Policy effective September 19, 2025, nearly a month
before the collision. Id. at 6 ¶ 27. Timber Creek alleges that when presented with a claim for
coverage stemming from the collision, it issued a denial letter stating that no policy had been in
effect. Id. ¶ 28.
Timber Creek’s complaint seeks a declaration that it has no duty to defend or indemnify
the defendants in the Underlying Suit because no policy was in effect at the time of the October
11, 2025 collision. (Doc. No. 1, p. 6 ¶¶ 29-31.) Timber Creek also seeks a declaration that the
Policy’s so-called “MCS-90” endorsement did not operate to mandate coverage because
Gonzalez “was using the vehicle exclusively in intrastate commerce.” Id. at 6-7 ¶¶ 33-35. Other
than this lone sentence, Timber Creek does not specify where Gonzalez was going with the
vehicle, where he was coming from, or what (if anything) he was hauling.
C. Timber Creek’s motion for default judgment.
Timber Creek has submitted a motion for default judgment and a supporting
memorandum. (Doc. Nos. 21, 21-1.) As well, Timber Creek has supplied several supporting
exhibits: the Policy it issued to Transport (Doc. No. 22); the notice of cancellation of the Policy
for nonpayment of premium (Doc. No. 22-1); and an October 31, 2025 letter to Barrios’ counsel
stating that no policy was in effect at the time of the collision (Doc. No. 22-2).
In its motion for default judgment, Timber Creek states that it served the defendants, but
that they failed to respond within the allotted time. (Doc. No. 21-1, p. 3.) Timber Creek asserts
that it sought and obtained an entry of default against the defendants. Id. And Timber Creek
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contends that a default judgment is procedurally proper and that the evidence supports a default
judgment. Id. at 5-8.
D. Legal standard.
Where a defendant has been properly served, courts considering whether to enter a
default judgment analyze first whether a default judgment is appropriate under the
circumstances. If so, then the court assesses the merits of the plaintiff’s claims and whether there
is a sufficient basis for default judgment. See Cellular South, Inc. v. C-Spire Consulting Servs.
Priv. Ltd., No. 3:25-CV-01756, 2026 WL 453189, at *1 & nn. 3, 5 (N.D. Tex. Feb. 18, 2026)
(citing Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th Cir. 1998) and Nishimatsu Constr. Co.,
Ltd. v. Houston Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975)). Regarding the
appropriateness question, Lindsey prescribes consideration of factors including (1) whether
disputes of material fact exist, (2) whether there has been substantial prejudice, (3) whether
grounds for default are clearly established, (4) whether the default was caused by a good faith
mistake or excusable neglect, (5) the harshness of a default judgment, and (6) whether the court
would be obliged to grant a motion from the defendant to set the default judgment aside. See id.
at *2 & n.4 (citing Lindsey, 161 F.3d at 893).
If default judgment is procedurally proper and there is a sufficient basis in the pleadings,
the court must finally determine “what relief, if any, the plaintiff should receive.” Hernandez v.
Roche, No. EP-20-CV-00263, 2022 WL 4072963, at *2 (W.D. Tex. Sept. 2, 2022), aff’d, No. 22-
50927, 2023 WL 2645548 (5th Cir. Mar. 27, 2023) (summary calendar) (quoting Wieck v. Synrg.
Royce LLC, No. A-17-CV-599, 2019 WL 697291, at *2 (W.D. Tex. Feb. 20, 2019)). A default
judgment “must not differ in kind from, or exceed in amount, what is demanded in the
pleadings.” Fed. R. Civ. P. 54(c). “‘When a plaintiff seeks a default judgment on a claim for
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declaratory relief, after determining whether the procedural requirements have been satisfied and
whether default judgment is warranted, the court is required to evaluate a plaintiff’s complaint to
determine whether “declaratory relief is appropriate in this case.”’” Deutsche Bank Nat’l Trust
Co. v. Kachlamat, No. 1:24-CV-495, 2025 WL 2267982, at *7 (E.D. Tex. July 15, 2025),
adopted, 2025 WL 2267665 (E.D. Tex. Aug. 6, 2025) (quoting Accredited Sur. & Cas. Co., Inc.
v. Landlord’s Daiquiri Den, LLC, No. 1:22-CV-591, 2023 WL 11761514, at *7 (E.D. Tex. July
26, 2023), in turn quoting RSDC Holdings, LLC v. Steinberg, Civ. No. 16-9381, 2017 WL
117314, at *2 (E.D. La. Jan. 12, 2017)).
A court may hold a hearing to (among other things) determine the truth of any allegation,
but a hearing is unnecessary if the court finds that it can rely on the pleadings and evidence to
determine whether to grant a default judgment. See Fed. R. Civ. P. 55(b)(2); James v. Frame, 6
F.3d 307, 310 (5th Cir. 1993).
E. Analysis.
Timber Creek has submitted sufficient allegations in its pleadings, along with sufficient
evidence, to allow the Court to determine whether to grant a default judgment. A hearing is
unnecessary. As discussed below, the district court should grant default judgment against the
defendants.
1. Service was properly effected, and the defendants failed to answer.
The record indicates that Timber Creek properly served the defendants, and that the
defendants failed to answer. Timber Creek served Cardenas and Garcia on April 2, 2026,
Barrios on April 10, and Transport on April 16. (Doc. Nos. 6, 6-1, 7, 8.) Service appears to have
been executed in accordance with the applicable rules. See id. The completed service
established the Court’s jurisdiction over the defendants. See Nat’l Liability & Fire Ins. Co. v.
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Mercado, No. 5:19-cv-131, 2021 WL 2322939, at *2 (S.D. Tex. Feb. 1, 2021) (Saldaña, J.). The
defendants’ answers were therefore due on April 23, May 1, and May 7, respectively. The
deadlines have passed, and none of the defendants have filed an answer or other responsive
pleading. The Clerk’s entry of default was therefore appropriate under Federal Rule of Civil
Procedure 55(a). See Doc. Nos. 18, 19.
2. Default judgment is procedurally appropriate.
The six Lindsey factors all favor granting default judgment. First, there are no material
facts in dispute, because Timber Creek’s well-pleaded factual allegations are assumed to be true
and because the defendants have failed to answer or file any other responsive pleading. See
United States v. Shipco Gen., Inc., 814 F.2d 1011, 1014 (5th Cir. 1987). Timber Creek would
suffer substantial prejudice from a failure to grant default judgment because the defendants’
failure to respond could bring adversarial proceedings to a halt – the defendants would suffer no
such prejudice. See J&J Sports Productions, Inc. v. Morelia Mexican Rest., Inc., 126 F. Supp.
3d 809, 814 (N.D. Tex. 2015) (defendant’s failure to file a response or otherwise appear in this
case “threatens to bring the adversary process to a halt, effectively prejudicing [plaintiff’s]
interests.”). The defendants’ persistent failure to respond or participate in this litigation clearly
establishes grounds for default. See Ruiz v. Bank of N.Y. Mellon, No. 1:22-CV-00483, 2024 WL
1049472, at *3 (W.D. Tex. Mar. 11, 2024) (grounds for default were “clearly established”
because defendants “failed to appear and participate at all, much less timely file a responsive
pleading”). There is no reason to believe that the defendants’ nonresponsiveness is caused by
any good-faith mistake or excusable neglect. Moreover, a default judgment would not be unduly
harsh in this case because the defendants were properly served, failed to appear, and are in
default, warranting a judgment under Rule 55(b)(2). And regarding the sixth Lindsey factor, it
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would not be clearly appropriate to set aside the default judgment upon a motion by the
defendants: the pleadings, the defendants’ lack of response, and the defendants’ consequent
failure to plead a meritorious defense suggest a lack of good cause for the setting aside of a
default judgment. Cf. Insurance Co. of the West v. H&G Contractors, Inc., No. C-10-390, 2011
WL 4738197, at *3 (S.D. Tex. Oct. 5, 2011) (Jack, J.) (concluding on the facts “known to the
Court at this time” that no “good cause” exists for which to set aside the default if challenged by
the defendant).
The district court should conclude under the Lindsey factors that a default judgment is
appropriate under these circumstances. Cf. Cellular South, 2026 WL 453189, at *2 (analyzing
Lindsey factors).
3. Default judgment is substantively appropriate with regard to the policy
period, but not with regard to the MCS-90 endorsement.
The next step is to assess the merits of Timber Creek’s claim for declaratory judgment.
Here, the well-pleaded allegations indicate that only one of its claims is meritorious.
a. Default judgment is appropriate with regard to the policy period claim.
Under Texas law, an insurer’s duty to defend and duty to indemnify are governed by the
so-called “eight corners rule.” See Nat’l Liability, 2021 WL 2322939, at *4 (citing GuideOne
Specialty Mut. Ins. Co. v. Missionary Church of Disciples of Jesus Christ, 687 F.3d 676, 682-83
(5th Cir. 2012)). Under that rule, the “scope of an insurer’s duty to defend is determined
exclusively by the allegations in the pleadings and the language of the insurance policy.” Id.
The two duties are distinct, and normally a duty to indemnify cannot be adjudicated until there
has been a judgment in the underlying suit. But an exception exists in circumstances where “‘the
same reasons that negate the duty to defend likewise negate any possibility the insurer will ever
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have a duty to indemnify.’” Id. (quoting Hartford Cas. Ins. Co. v. DP Eng’g, L.L.C., 827 F.3d
423, 430 (5th Cir. 2016) (internal quotation omitted)). In that situation, an insurer can obtain a
declaratory judgment on its duty to indemnify. Id.
Timber Creek’s submitted documentation indicates that it issued the Policy to Transport,
which took effect on July 29, 2025. (Doc. No. 22, p. 5.) The Policy states that it provides
coverage “[i]n return for the payment of the premium,” and that Timber Creek “will have the
right and duty to defend any ‘insured’ against a ‘suit’ asking for [damages caused by an
accident],” but that Timber Creek had no duty to defend against a suit seeking damages for
injury or damage to which the Policy did not apply. Id. at 10, 20-21. The Policy also provides
that coverage exists during the policy period, and that the Policy could be cancelled for
nonpayment of the premium. Id. at 30, 33.
The Policy provided that Timber Creek could cancel the Policy with ten days’ notice for
nonpayment of the premium. (Doc. No. 22, p. 33 ¶ A.2.a.) Timber Creek’s documentation
indicates that it cancelled the Policy effective September 19, 2025 for nonpayment of the
premium. (Doc. No. 22-1.) It is not clear from the face of the cancellation notice that Timber
Creek issued it at least ten days prior to September 19. But that question is immaterial, because
the collision giving rise to the Underlying Suit occurred on October 11, 2025, nearly a month
after the September 19 cancellation notice. See Doc. No. 22-2. Under the language of the
pleadings and the Policy, Timber Creek appears to have a meritorious claim that it is not required
to defend or indemnify Transport because there was no Timber Creek policy in effect at the time
of the October 11 collision.
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b. Default judgment is inappropriate with regard to the MCS-90
endorsement claim.
The same cannot be said, however, regarding Timber Creek’s second asserted ground for
declaratory relief. Timber Creek alleges that coverage is excluded under the so-called MCS-90
endorsement. The Policy contains the following endorsement:
MCS-90 NON-COMPLIANCE ENDORSEMENT
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT
CAREFULLY.
This endorsement modifies insurance provided under the following:
Commercial Auto Liability Coverage General
Liability Coverage Uninsured/Underinsured Motorist
Coverage
In consideration of the premium charged, it is agreed that as respects any Claim
under this Policy for which coverage is also provided by one (1) or more other
policies issued by the Insurer, an affiliate thereof, or by any other member of what
is commonly referred to as “Timber Creek Insurance Company Inc., A Risk
Retention Group (TCCI)” under the MCS-90 which states that it “covers all
vehicles owned, operated, or maintained by the insured regardless of whether or
not each motor vehicle is specifically described in the policy.” However, if a
claim is paid by TCCI under the MCS-90 provision of this policy then, TCCI may
recoup its losses by subrogating the claims paid against the motor carrier and/or a
premium penalty of up to 200% of the original premium cost per auto not listed at
the time of inception of the TCCI policy. It is so vitally important to have all
equipment listed on the schedule of the TCCI policy.
Notwithstanding the above, in the event such other TCCI Insurance Policy has a
provision like this one, then the above paragraph will not apply but instead:
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Nothing contained in this endorsement shall be construed to prevent compliance
with the filing of the MCS-90 of this Policy.
All other terms remained [sic] unchanged.
(Doc. No. 22, p. 65.)2 The Policy contains a list of endorsements, and the “MCS-90 Non-
Compliance Endorsement” is on that list. Id. at 6. Also on the list is an endorsement called
“Endorsement for Motor Carrier Policies of Insurance for Public Liability under Sections 29 and
30 of the Motor Carrier Act of 1980.” Id. The Policy itself, however, does not contain any such
endorsement.
According to Timber Creek, MCS-90 endorsements are “designed to apply in the context
of interstate motor carrier operations. At the time of the accident, [Gonzalez] was using the
vehicle exclusively in intrastate commerce.” (Doc. No. 1, p. 7 ¶ 34.) Timber Creek does not
elaborate on this position in the motion for default judgment or supporting memorandum except
to state, conclusorily, that “there exists no provision or endorsement in the Policy, or in any
applicable state or federal law, that would force application of the Policy outside of its own terms
in this case.” (Doc. No. 21-1, p. 7.)
The MCS-90 endorsement is “federally mandated.” Canal Ins. Co. v. Coleman, 625 F.3d
244, 246 (5th Cir. 2010); see also 49 C.F.R. § 387.7(a). The endorsement “creates a suretyship,
which obligates an insurer to pay certain judgments against the insured arising from interstate
commerce activities, even though the insurance contract would have otherwise excluded
coverage.” Canal Ins. Co., 625 F.3d at 247 (citing Minter, 423 F.3d at 470). An MCS-90
endorsement is not insurance, and it does not expand coverage under a policy. Rather, it is
“triggered when the policy to which it is attached does not provide coverage to the insured.”
2 Timber Creek offers no explanation of what the term “non-compliance” means in the endorsement’s title.
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Minter v. Great Am. Ins. Co. of N.Y., 423 F.3d 460, 470-71 (5th Cir. 2005) (citing T.H.E. Ins. Co.
v. Larsen Intermodal Servs., 242 F.3d 667, 670 (5th Cir. 2001)); see also Lancer Ins. Co. v. L&Y
Trucking LLC, No. 1:23-CV-113, 2024 WL 2786049, at *6 (N.D. Tex. May 7, 2024) (“The
MCS-90 endorsement might create liability, but it cannot create coverage out of nothing.”).
In this case, default judgment for Timber Creek on this claim is inappropriate for two
reasons. First, the Policy does not contain the MCS-90 endorsement that Timber Creek claims
does not apply. The endorsement may be federally mandated, but it is not part of the Policy that
Timber Creek has supplied for review. Timber Creek offers no explanation for the
endorsement’s absence, nor does it advance any argument or authority that courts are to “read in”
an MCS-90 endorsement where one is absent from the Policy or what specific terms such an
endorsement would necessarily contain. Indeed, some case law suggests the contrary – that
courts should not imply an MCS-90 endorsement, see Illinois Central R. Co. v. Dupont, 326 F.3d
665, 669 (5th Cir. 2003) and General Star Nat’l Ins. Co. v. Ginnetti Trucking LLC, No. 08 Cv.
2957, 2010 WL 11505094, at *3 (S.D.N.Y. Feb. 16, 2010), and the Court will not endeavor to
read in such an endorsement sua sponte in this case. Because the Policy contains no MCS-90
endorsement, Timber Creek fails to show that it is substantively entitled to relief.
Additionally, Timber Creek alleges in its complaint that the MCS-90 endorsement does
not apply because Gonzalez was using the vehicle only in intrastate commerce. (Doc. No. 1, p. 7
¶ 34.) Timber Creek reasons that it therefore has no obligation to defend or indemnify Transport
in the Underlying Suit. See id. ¶ 35. While courts do seem to agree that intrastate trips do not
trigger MCS-90 endorsements,3 Timber Creek has not pleaded any nonconclusory facts (or any
3 See Canal Ins. Co., 625 F.3d at 249 (“we conclude that the endorsement covers vehicles only when they are
presently engaged in the transportation of property in interstate commerce”); see also Progressive Gulf Ins. Co. v.
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facts at all, really) indicating the vehicle’s origin or destination points or what the vehicle was
transporting. Timber Creek has therefore failed to demonstrate that it is entitled to judgment on
the merits of this claim.
4. Partial declaratory relief is appropriate.
The Declaratory Judgment Act provides: “In a case of actual controversy within its
jurisdiction . . . any court of the United States . . . may declare the rights and other legal relations
of any interested party seeking such declaration, whether or not further relief is or could be
sought.” 28 U.S.C. § 2201(a); Fed. R. Civ. P. 57 (“The existence of another adequate remedy
does not preclude a declaratory judgment that is otherwise appropriate.”). But a declaratory
judgment is ripe for adjudication only where an “actual controversy” exists and where the court
has authority to grant declaratory relief. See Frye v. Anadarko Petrol. Corp., 953 F.3d 285, 294
(5th Cir. 2019).
Timber Creek, as the plaintiff in this federal declaratory judgment action, bears the
burden of proving, by a preponderance of the evidence, that an actual controversy exists. See
Cardinal Chem. Co. v. Morton Int’l, Inc., 508 U.S. 83, 95 (1993). An actual controversy exists
where a “substantial controversy of sufficient immediacy and reality exists between parties
having adverse legal interests.” Venator Gp. Specialty, Inc. v. Matthew/Muniot Family, L.L.C.,
322 F.3d 835, 838 (5th Cir. 2003). In Maryland Casualty Company v. Pacific Coal & Oil
Company, the Supreme Court held that an “actual controversy” exists where an insurer brings a
declaratory judgment action against its insured and an injured party seeking liability
determination against the insured in a state court action. 312 U.S. 270, 273 (1941).
Estate of Jones, 958 F. Supp. 2d 706, 714 (S.D. Miss. 2013) (applying trip-specific analysis to determine whether
transport was interstate or intrastate).
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Here, in seeking a declaration of non-coverage based on the prior cancellation of the
policy for nonpayment of the premium, Timber Creek has adequately alleged an actual
controversy. Timber Creek has sued both its insured and the injured parties from the Underlying
Suit. Cf. Maryland Casualty Co., 312 U.S. at 273.
Timber Creek fails, however, to allege the existence of an actual controversy with regard
to the MCS-90 endorsement. As discussed above, Timber Creek failed to plead or show that the
policy contained an MCS-90 endorsement. A grant of declaratory relief that such an
endorsement would not require Timber Creek to defend or indemnify Transport would therefore
amount to an advisory opinion. The district court should therefore dismiss Timber Creek’s
motion for default judgment on the MCS-90 claim, without prejudice, for lack of jurisdiction.
Cf. Allstate Fire & Cas. Ins. Co. v. Vernon, No. SA-24-CV-00460, 2025 WL 1669411, at *5
(W.D. Tex. June 12, 2025) (declining to grant default judgment because declaratory judgment
plaintiff failed to demonstrate existence of actual controversy).
The next step is to determine whether the district court should grant declaratory relief.
The Court does possess the authority to grant declaratory relief in this situation. There is no
indication that any state court action exists with regard to the issues presented by Timber Creek
in this federal declaratory judgment action such that abstention would be required. See Deutsche
Bank, 2025 WL 2267982, at *9.
Federal courts have substantial discretion to entertain, stay, or dismiss declaratory
judgment actions. See Deutsche Bank, 2025 WL 2267982, at *9 (citing Wilton v. Seven Falls
Co., 515 U.S. 277, 282-83 (1995)). Several factors inform the Court’s decisionmaking process:
whether a state action is pending in which all of the matters in controversy may be fully litigated;
whether Timber Creek filed this declaratory judgment suit in anticipation of a suit by any of the
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defendants; whether Timber Creek has engaged in forum shopping in bringing the suit; whether
possible inequities exist by allowing Timber Creek to gain precedents in time or to change fora;
whether this federal court is convenient for the parties and witnesses; whether retaining the case
in federal court will serve judicial economy; and whether this federal court is being called upon
to construe a state judicial decree involving the same parties and entered by the court before
whom the parallel state suit between the same parties is pending. See id. (citing Nat’l Liab. &
Fire Ins. Co., 2021 WL 2322939, at *5).
Here, there is no pending state action or state judicial decree involving the issues
presented in this federal case. There is no reason to believe that Timber Creek filed this action in
anticipation of any suit against it, or that Timber Creek has engaged in forum shopping. The
events giving rise to this case occurred in this district and division, so there do not appear to be
any concerns regarding convenience or inequity in selection of forum. And retaining this suit
rather than dismissing it would serve the interests of judicial economy because Timber Creek has
already expended time and resources in this case. The district court should exercise its discretion
to grant declaratory relief on Timber Creek’s claim that it is not required to defend or indemnify
Transport because there was no policy in effect at the time of the October 11, 2025 collision
forming the basis for the Underlying Suit.
F. Conclusion and recommendation.
The district court should take the following actions:
• GRANT IN PART Timber Creek’s motion for default judgment (Doc. No. 21) to the
extent it seeks default judgment on the failure to answer or otherwise respond by the
defendants in this declaratory judgment action.
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• DISMISS IN PART Timber Creek’s motion for default judgment (Doc. No. 21) to the
extent it seeks default judgment on the MCS-90 endorsement claim. This dismissal
should be without prejudice, for lack of subject matter jurisdiction.
• DECLARE that Timber Creek is not required to defend or indemnify Transport in the
Underlying Suit based on the terms of policy number TCC-TX00098157.
G. Notice.
The Clerk will file this Memorandum and Recommendation and transmit a copy to each
party or counsel. Within 14 days after being served with a copy of this Memorandum and
Recommendation, any party may file with the Clerk and serve on the United States Magistrate
Judge and all parties, written objections, pursuant to Fed. R. Civ. P. 72(b), 28 U.S.C. § 636(b)(1),
and General Order No. 2002-13, United States District Court for the Southern District of Texas.
A failure to file written objections to the proposed findings, conclusions, and
recommendation in a magistrate judge’s report and recommendation within 14 days after being
served with a copy shall bar that party, except upon grounds of plain error, from attacking on
appeal the unobjected-to proposed factual findings and legal conclusions that are accepted by the
district court. See Douglass v. United Servs. Auto Ass’n, 79 F.3d 1415, 1428-29 (5th Cir. 1996)
(en banc).
SIGNED on July 28, 2026.
_____________________________
MITCHEL NEUROCK
United States Magistrate Judge
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