The plaintiffs in Turner v. Cincinnati Ins. Co. obtained a “non-adversarial” default judgment against a defunct vocational school. The Fifth Circuit found that Texas’s “no-direct action” rule did not bar their claim against the school’s insurer: “[T]he Plaintiffs’ default judgment against ATI is an adjudication that satisfies the no-action clause. Accordingly, although the non-adversarial default judgment does not bind Cincinnati to its terms,  the no-direct-action rule is not a bar to this coverage suit.” (citation omitted). (Unfortunately for the plaintiffs, the Court then affirmed the dismissal of their claim on timeliness grounds.) No. 20-50548 (Aug. 13, 2021).

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