The Fifth Court held in Rudnicki v. Thompson Petroleum Corp. that a former oil-company executive was not entitled to indemnity for certain litigation expenses, agreeing with the company’s position that: ““[Partnership’s] Agreement could have provided for indemnification of expenses incurred ‘based on,’ ‘arisin(g from,’ or similarly ‘related to’ a covered person’s performance of the obligations of the GP with respect to [the Partnership]. But that simply is not what it says.” The company was authorized to indemnify the executive, but was not required to do so. No. 05-23-00125-CV (March 20, 2024) (mem. op.).

In this products liability case, a distributor of latex gloves sought statutory indemnity from the manufacturer of those gloves.  The Court of Appeals found that the manufacturer was liable under Section 82.002 of the Texas Civil Practice and Remedies Code to the distributor for litigation costs expended in defending two products liability lawsuits related to the gloves brought by healthcare workers because those expenses were “related to” the manufacturer’s gloves, even though other manufacturer’s gloves were at issue in the lawsuit.

United Med. Supply Co. v. Ansell Healthcare Prods., Inc.

The court today issued an opinion in a products liability indemnification case arising out of a helicopter crash in North Carolina.  The company that operated the helicopter sued the manufacturer of a defective gearbox after the operator settled with the estate of the deceased pilot for $2.5 million.  The gearbox maker had agreed to indemnify the operator for all losses, claims, and expenses arising out of any defective work.  The jury found that the negligence of both parties had been a proximate cause of the accident, but the trial court set aside that finding with respect to the gearbox manufacturer and rendered a take-nothing judgment on the operator’s indemnification claim.  The court of appeals affirmed, holding that there was sufficient evidence that the operator’s negligence caused the helicopter  to crash.  The court then accepted the manufacturer’s argument that the express negligence doctrine barred the operator’s indemnity claim because the indemnity agreement failed to state that it would require the manufacturer to indemnify against the operator’s own negligence.  Even though the manufacturer’s own negligence had been found to be a proximate cause of the crash, the operator could not recover against the manufacturer because the parties did not contract for proportionate indemnity.

American Eurocopter Corp. v. CJ Systems Aviation Group, No. 05-10-00342-CV