The underlying dispute stems from the death of Thaes Webb Jr. According to allegations in AIX's Second Amended Complaint, Webb was fatally injured when his wheelchair tipped over in the back of a vehicle operated by Twin Oaks Senior Living, a Utah facility that provides nursing and residential care to senior citizens. The Webb family sued Twin Oaks and related defendants in Utah state court, alleging general failures to provide adequate care as well as the failure to secure the wheelchair. AIX Specialty Insurance Company, which had issued both a primary and an excess liability policy to the insured defendants, denied coverage for claims arising from the vehicle incident while agreeing that coverage might be available for other professional-negligence claims. AIX provided a defense under a reservation of rights.

In August 2025, without AIX's participation or consent, the insured defendants and the Webb family entered a settlement under which the Utah court entered a $4,000,000 consent judgment against Twin Oaks. Of that amount, $1,026,500 has already been satisfied, primarily by other insurers, leaving $2,973,500 outstanding. The settlement assigned all of the insured defendants' rights against AIX arising under the insurance policies to the Webb family, who agreed not to collect from the insured defendants themselves. AIX then filed a federal declaratory judgment action seeking a ruling that it owes no duty to defend or indemnify for the auto-related claims and that the consent judgment creates no payment obligations for it.

Defendants moved to dismiss under Rule 12(b)(1), arguing that AIX's suit was a de facto appeal of the state-court judgment barred by Rooker-Feldman and, alternatively, that the court should decline jurisdiction under the Declaratory Judgment Act. District Judge David Barlow denied both motions.

On Rooker-Feldman, the court held that AIX was not a party to the underlying state-court action, was not named in the consent judgment, and did not sign the settlement agreement. The court rejected defendants' argument that AIX was a state-court loser by privity, noting that the Tenth Circuit precedent on which defendants relied — Kenmen Engineering v. City of Union — was overruled in part by the Supreme Court in Lance v. Dennis, which held that the Rooker-Feldman doctrine does not bar actions by nonparties to the earlier state-court judgment simply because, for purposes of preclusion law, they could be considered in privity with a party to the judgment. The court also held that even if AIX were a party, the fourth Rooker-Feldman factor was not satisfied because a ruling on AIX's contractual indemnity obligations would not reverse or undo the consent judgment, which resolved only the insured defendants' tort liability and damages owed to the Webb family.

On the Declaratory Judgment Act, the court walked through the five Mhoon factors used in the Tenth Circuit to assess whether to hear a declaratory action. It held that none of the five factors weighed in favor of abstention or dismissal: the federal action would settle a controversy entirely separate from the state-court tort case; it would clarify the parties' contractual relationship; there was no evidence of procedural fencing because no parallel state proceeding on the coverage question was pending or imminent; a coverage ruling would not declare any part of the consent judgment unenforceable or create friction with the state court; and defendants identified no pending or imminent alternative state-court proceeding that would resolve the coverage dispute.

The case is AIX Specialty Insurance Company v. Kim's New Star LLC dba Twin Oaks Senior Living, No. 2:25-cv-00672-DBB-JCB (D. Utah Apr. 16, 2026).