## IN THE SUPREME COURT O F TEX AS

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. 11-0425

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### P E T R O L E U M 

### S O L U T IO N S 

### , I N C


### . , P E T IT IO N E R 

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v . 

### B IL L 

### H E A D D 

### / B 

### / A 

### B IL L 

### H E A D 

### E N T E R P R IS E S A N D 

### T IT E F L E X 

### C O R P O R A T IO N 

### , R E S P O N D E N T S

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O N P E T I T I O N F O R R E V I E W F R O M T H E C O U R T O F A P P E A L S F O R T H E T H I R T E E N T H D I S T R I C T O F T E X A S

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Argued Dec em ber 4, 2012
J U S T I C E B O Y D , dissenting in par t. The Court holds in this case that the trial court abused its discretion by char g ing the jury with

a spoliation instruct i o n and striking Petroleum Soluti ons’s statute-of- limit ations defe nse beca use those sanctions do not comport with the standards set forth in our rec ent decision in Brookshire
Bro s
. , In c. v. Aldridge , ___ S.W .3d ___ (Tex. 2014). I ag ree , and I join that part of the Court’s opinion. But t h e C o u rt also holds that section 82.002 of the Texas Civil Practice s and Remedies Code require s Petroleum Soluti ons to indemnif y T i t ef lex for the attorney ’s fee s and expenses Titeflex incurre d in defen ding ag ainst alleg ations that Titeflex manufa cture d and sold a defe ctive flex co nnector

. Until now, we have consistently held that, in a products liability action involving alleg ations that more than one product is defe ctive, section 82.002 requ i re s a manufa cture r to indemnify another manufa ctur er o n l y ag ainst losses arising from alleg ations that the firstmanufa cture r’s p ro d u ct was defe ctive. And, conver sely , we have held that the statute does not

require the first manufa ctu re r to indemnify the second manufa cture r ag ainst losses arising from alleg ations that the second manufa cture r’s own product was defe ctive. Be cause Titeflex incurre d all of the losses for which it seeks indemnity in this case defe nding ag ainst claims that Titeflex’s own flex connec tor was defe ctive, and beca use Petroleum Soluti ons is not the manufa cture r of Titeflex’s alleg edly defe ctive fle x connec tor, I respe ctfully

dissent from that par

t of the Court’s judg ment.
I. The Duty, the Scope, and the Exception Section 82.00 2 (a ) o f the Texas Civil Practice s and Remedies Code provides that “[a] manufa cture r shall indemnify an d h o l d harmless a seller ag ainst loss arising out of a products liability action, except for any loss cause d by the seller’ s . . . act or omission

. . . for which the seller is independently

liable.” T E X
. C I V
. P R A C
. & R E M
. C O D E § 82.002(a) . A “pr oducts liability action” is “any action ag ainst a manufa cture r or seller for re cover y of damag es . . . alleg edly cause d by a defe ctive product whether the action i s b as ed in strict tort liability , strict products liability ,

n eglig ence , misrepre sentation, brea ch of express or implied war ranty , or any other theory o r combination of theor i es . ” Id

. § 82.001(2). Reading this lang uag e within the context of the rest of chapte r 82, we have construed t h e statute to addre ss three main issues: (1) who has the duty to indemnify a seller in a products liability action, (2) what is the scope of that duty , and (3) when does the exception to the duty

apply ?
As t o t h e issue of who has the duty , we have explained that “[t] he duty to indemnify i s trig g ere d by the injured claimant’s pleading s,” and “is imposed only on ‘the manufa cturer of a

2product claimed in a petition or complaint to be defe ctive.’” Gen. Motors Corp. v. Hudiburg

Chevrolet, Inc ., 199 S.W .3d 249, 256 (Tex. 2006) (quoting Fitzgerald v

. Advanc ed Spine Fixation Sys., Inc ., 996 S.W .2d 864, 866 (Tex. 1999) (quoting T E X
. C I V
. P R A C
. & R E M
. C O D E § 82.002(f) ). The pleading s need not “ actua lly name” the manufa cture r to tr igg er the manufa cture r’s duty , id. at 257, but they must at least alleg e that the manufa cture r’s product was defe ctive. Id. ; see also Fitzgerald , 996 S.W .2d at 867 (“[O]nly manufa cture rs of a product alleg ed by a plaintif f t o have been de fec tive are subject to a c laim of indemnity .”).
As to the scope of the manufa cture r’s duty , we held in Fitzgerald that the manufa cture r must indemnify “[a]ny one who qualifies as a ‘seller ,’” even if the seller is not “prove n to have been in the chain of distribution.” 996 S.W .2d at 867 (citing T E X
. C I V
. P R A C
. & R E M
. C O D E § 82.001(3))

. We later held that the statute require s the manufa cture r of the alleg edly defe ctive product to indemnify the seller ag ainst “all direc t alleg ations ag ainst the seller that relate to [t he] plaintiff’s injury .” Meritor Auto., Inc. v . Ruan Leasing Co ., 44 S.W .3d 86, 90 (Tex. 2001)

. We clarifie d that the duty includes an obliga tion to pay the attorney ’s fee s and cost s t h at a s ell er incurs defe nding ag ainst claims that the seller neg lige ntly maintained the product and was there fore independe ntly liable for the plaintiff’s injuries. Id . at 87. Finally , addre ssing the statutory exception to the duty , we have explained that, althoug h the duty is trig g ere d by the pleading s, the exception applies only upon an actua l finding , and not mere ly

an alleg ation, “that the seller’ s independe nt conduct was a cause of the plaintiff’s injury .” Id

. at 91; see also id . at 90 (holding that the statute excepts from the duty “only those losses ‘ca used by ’ the seller” ) (quoting T E X
. C I V
. P R A C
. & R E M
. C O D E § 82.002(a) ). Thus, “[t] o esca pe this duty to
3indemnify , the [m anufa cture r] must prove the [seller’s] independe nt culpability .” Hudiburg , 199

S.W .3d at 255.
II. Multiple-P roduct Cases Whil e our holdings on these three issues are rela tively straig htforwa rd, construing the statute become s signific antly more complicated when a single products liability action includes alleg ations that two or more differ ent products, eac h produce d by a differ ent manufa cture r, are defe ctive. Such

an action may involve alleg ations that multipl e differ ent products produce d by sepa rate manufa cture rs are defe ctive, e.g. , Owens & Minor, Inc. v Ansell Healthcare Prods., Inc ., 251 S.W .3d
481 (Tex. 2008), or alleg ations that a finished product and one or more of its component parts (which themselves are also products) are defe ctive, e.g. , Hudiburg , 199 S.W .3d at 253. Under the statute’s definitions, “all manufa cture rs are also sellers.” Id

. at 256. Thus, in actions involving alleg ations that

more than one manufa cture r’s product was defe ctive, eac h manufa cture r owes a duty to indemnify , but eac h is also a “se ller” a nd thus entitled to be indemnified. Multiple-product c ases thus pre sent issues of which manufa cture rs owe a d u t y t o indemnify whom, and what happens if the differ ent manufa cture rs all owe a

duty to eac h other a

nd to other seller s. Unfortuna tely , the statute does not expli citly addre ss product l i ab i l ity actions involving multipl e alleg edly defe ctive products. We have construed and applied the statute, howeve r, to case s involving alleg ations that multipl e differ ent products are defe ctive and case s involving alleg ations that a finished product and one or more of its component parts are defe ctive. I n both ty pes of case s,

we have consistently held that eac h manufa cture r of an alleg edly defe ctive product must indemnify

4ag ainst los s es re l at ed to alleg ations of a defe ct i n its own product but need not indemnify another

manufa cture r ag ainst losses rela ted to the other manufa cture r’s alleg edly defe ctive product. Today , the Court modifies—or, perha ps, abandons—this rule, holding that the manufa cture r of a finished product must indemnify

the manufa cture r/seller of a compone nt part of the f inished product, eve n
ag ainst losses rela ted to alleg ations that the seller’ s own component part was itself defe ctive, unless the component- part manuf actur er is ac tually

found liable.
W e first addre ssed these issues in the context of a finished-produc t/component-produc t

scena rio in Hudiburg , specific ally to decide whether the statute require d compon ent-part manufa cture rs to indemnify a deale r (a “seller ” under the statute) who sold the finished product that contained the component parts. To re s o l v e the duty issue, we returne d to the basic rule discussed above: “t h e duty [t o indemnify ] is imposed only on ‘the manufa cture r of a product claimed in a petition or complaint to be defe ctive.’” Hudiburg , 199 S.W .3d at 256 (quoting Fitzgerald , 996
S.W .2d at 866 (citing T E X
. C I V
. P R A C
. & R E M
. C O D E § 82.002(f) ). App l y i n g t h i s rule in the component-pa

rt context , we conclude d that the statute imposes the duty to indemnify on eac h manufa cturer o f ea ch co mponent part that the claimant alleg es to be defe ctive. We reje cted the
arg ument, howeve r, “that an alleg ation t h at a [finis hed] product is defe ctive nece ssarily includes

asser tions that all of its components are defe ctive.” Hudiburg , 199 S.W .3d at 257. I nstead, we held th at a pleading trig g ers a component-pa rt manufa cture r’s duty to indemnify only if the pleading

5“f

ai rl y alleg e[s] a defe ct in the component itself, not mere ly a defe ct in the [finis hed] produc t o f which the c omponent was pa rt.” Id

. 1
We also addre ssed in Hudiburg the scope of the duty to indemnify in a multipl e-pr oduct case . GM, which had manufa cture d one of the alleg edly d ef ec t i v e component parts (the truck chassis),
arg ued that the statute “does not require a component-pr oduct manufa cture r to indemnify a finishedproduct manufa cture r ag ainst losses arising from defec ts in t h e finished product unrelated to the
compone nt .” Id

. at 261 (empha sis added)

. GM asser ted that since it had s et t l ed all claims that its component part (the chassis) was defe ctive, “the only rema ining claims—and those for which [t he seller] seeks indemnity

—nece ssarily

rela te to [a differe nt component par t] or its attachment to the chassis, cla ims for which GM ha s no duty to indemnify .” Id

. We ag ree d that the s tatute “does not impo s e o n a component-product manufac turer a dut y
to indemnify for losses due to alleged defec ts unrelated to its compone nt .” Id

. at 261–62 (empha sis added)

. We thus held that GM had “no statutory duty to indemnify [t he seller] for losses arising out of the plaintiffs’ action due to alleg ations that the truck, as distinct from one of its components, the chassis, was defe ctive.” Id

. at 262. Even though GM was the manufa cture r of an alleg edly defe ctive product in this products liability action and thus had the statutory duty to indemnify sellers for their losses in the acti on, we held that the s cope of that duty only cover ed “losses rela ted t o alleg ations that the chassis was defe ctive.” Id

. We ultimately conclude d, howeve r, that the court of appea ls had

I n H u d i b u r

g , w e d i s c u s s e d t h e s i m i l a r d e c i s i o n w e i s s u e d t h e p r e v i o u s y e a r i n B o s t r o m S e a t i n g , I n c
. v
. T r a n e 1 C a r r i e r C o . , 1 4 0 S

. W

. 3 d 6 8 1 ( T e x . 2 0 0 4 ) , i n w h i c h t h e m a n u f a c t u r e r o f a g a r b a g e t r u c k s o u g h t i n d e m n i t y f r o m t h e m a n u f a c t u r e r o f t h e d r i v e r ’ s s e a t t h a t w a s i n c o r p o r a t e d i n t o t h e t r u c k

. T h e c l a i m a n t i n t h a t c a s e a l l e g e d t h a t t h e g a r b a g e t r u c k w a s d e f

e c t i v e b u t “ n e v e r a l l e g e d t h a t t h e s e a t w a s d e f e c t i v e , a n d f

o r t h a t r e a s o n a l o n e , ” w e h e l d , t h e s e a t ’ s m a n u f a c t u r e r h a d n o s t a t u t o r y d u t y t o i n d e m n i f y t h e m a n u f

a c t u r e r / s e l l e r o f t h e t r u c k

. H u d i b u r g , 1 9 9 S

. W

. 3 d a t 2 6 1

. 6corr ectly reve rsed a summary judgme nt in GM’s favor beca use the rec ord did “not establish that the indemnity

claimed a g ainst GM is solely for losses unre lated to any defe ct in its chassis.” Id

. I n the case befor e us today , the Court relies on lang uag e from a para g raph that appea rs ear lier in o u r Hu diburg opinion, in which we introduced conce pts rela ted to indemnity claims betwee n component-pr oduct manufa cture rs and finished-produc t manufa cture rs with the following four
statements: [1] “the manufa cture r of a component product alleg ed b y a cl aimant to be defe ctive has a dut y t o i ndemnify an innocent seller/manuf actur er of a finished product which incorpora tes the component from loss arising out of a produc ts liabili ty

action re lated to the alleg ed def ect” ; [2] “the manufa cture r of an alleg edly defe ctive finished product has a duty to indemnify th e innocent seller/manufac turer of a component product for the same loss”; [3] “[i] f neither the component-pr oduct manufa cture r nor the finished-p ro duct manufa cture r is innocent, depending not on all eg ations but on proof, both indemnity

claims under the statute will fail”; and [4] “[i] f both are innocent, ag ain depending on proof, the indemnity claims offse t eac h other.” Hudiburg , 199 S.W .3d at 256–57. These statem en t s ar e co nsistent with our basic rules and the actua l holdings that we

announce d later in our Hudiburg opinion. The first s t at em en t is straig htforwa rd: if a claimant alleg es that a component product is defe ctive, the manufa cture r of that component product has a 2 3

“ T h e d u t y t o i n d e m n i f

y i s t r i g g e r e d b y t h e i n

j u r e d c l a i m a n t ’ s p l e a d i n g s . ” H u d i b u r g , 1 9 9 S

. W

. 3 d a t 2 5 6

. 2

T h e d u t y t o i n d e m n i f

y “ i s i m p o s e d o n l y o n ‘ t h e m a n u f a c t u r e r o f

a p r o d u c t c l a i m e d i n a p e t i t i o n o r c o m p l a i n t 3 t o b e d e f e c t i v e . ’ ” F i t

z g e r a l d , 9 9 6 S

. W

. 2 d a t 8 6 6 ( q u o t i n g T E X
. C IV
. P R A C
. & R E M
. C O D E § 8 2

. 0 0 2 ( f ) )

. 7duty

to indemnify

any seller ( which would include the fini shed product manufa cture r) from loss 4 arising out of a produc ts liabili ty action to the exte nt the loss is “ related t o the alleged de fect” in the compone nt product

. The second statement is consistent and corr ect for the same rea sons: if the 5
claimant alleg es that the

finished product is defe ctive, the manufa cture r of the finished product must indemnify sellers (including manufa cture rs of compone nt parts included within the finished product) for their losses, but only to the exte nt that their losses are related to the alleged defec t in the finished product.
I f the claimant alleg es that both the component part and the finished produc t containing it

are defe ctive, then under the first two statements eac h manufa cture r will owe a duty to inde mnify the ot her (beca

use ea ch is both a manufa cture r of a n alleg edly

defe ctive product and a “seller ” in the products liability action), u n l es s t h e o ther is actua lly found to be independe ntly liable, thus trig g ering the exception. The third statement is thus also corr ect: “if neither of the manufa cture rs 6 is innocent, depe nding on pr oof,” c an only mean that the jury or cour t actually finds that they

are both independe ntly liable, and in that case the ex ception to the duty to indemnify would apply to both manufa cture rs’ duties. Be cause of the exception, “both indemnity claims under the statute will fail.” And the fourth statement—“if both are innocent, ag ain depending on proof” —can only ref er

T h e m a n u f

a c t u r e r m u s t i n d e m n i f

y “ [ a ] n y o n e w h o q u a l i f i e s a s a ‘ s e l l e r , ’ ” e v e n i f t h e s e l l e r i s n o t “ p r o v e n t o 4 h a v e b e e n i n t h e c h a i n o f d i s t r i b u t i o n . ” F i t z g e r a l d , 9 9 6 S

. W

. 2 d a t 8 6 7

. T h e s c o p e o f t h e d u t y o n l y c o v e r s “ l o s s e s r e l a t e d t o a l l e g a t i o n s t h a t t h e [ c o m p o n e n t p a r t ] w a s d e f e c t i v e , ” a n d 5 d o e s n o t i n c l u d e “ l o s s e s d u e t o a l l e g e d d e f e c t s u n r e l a t e d t o i t s c o m p o n e n t

. ” H u d i b u r g , 1 9 9 S

. W

. 3 d a t 2 6 2

. T h e a p p l i e s o n l y u p o n a f i n d i n g , a n d n o t m e r e l y a n a l l e g a t i o n , “ t h a t t h e s e l l e r ’ s i n d e p e n d e n t c o n d u c t w a s a 6
c a u s e o f t h e p l a i n t i f

f ’ s i n j u r y . ” M e r i t o r A u t o
. , 4 4 S

. W

. 3 d a t 9 1

. 8to the situation in which there is no finding that either is independe ntly liable, so the exception does

not apply to either and eac h still owes a duty to indemnify the other, so one would offse t the other. 7
Bu t , as t he rema inder of our Hudiburg opinion explains, all of these statements ar e

nece ssarily subject to the limit on the scope of the duty descr ibed in the first statement. Today , the
Court construes these s tatements t o mean that, “[i] f c ompeting duties to indemnify are trig g ere d, the ultimate suc cess of those claims will depend on what the evidenc e shows as to the fault of the indemnitee sellers.” Ante at ___. This construction is corr ect only to the extent it ref ers to the issue of whether the exception applies to either manufa cture r’s duty to indemnify , beca use it is only the exception (and not the duty ) that “depe nd[s] on what the evidenc e shows.” More importantly , this statement ultimately

overlooks wha t we said in Hudiburg reg arding the l imits to the scope of the manufa cture rs’ respe ctive duties even in the absenc e of the exception. The Court say s, for example, that we held in Hudiburg that “GM owed Hudi b urg a duty to indemnify for losses related to the personal injury suit , to the extent Hudiburg was not inde pendently liable.” Ante at ___ (empha sis added)

. That is simply not what we said in Hudiburg ; to the contra ry , what we actua lly said was that
GM owed Hu d iburg a duty to indemnify to the extent of any “ losses related to allegations that [GM’s compone nt part] was defec tive ,” and does not include “losses due to alleg ed defe cts unrelated to its component .” Hudiburg , 199 S.W .3d at 262 (e mphases adde d).

I n t h i s r e g a r d , I d o n o t u n d e r s t a n d t h e C o u r t ’ s s t a t e m e n t t h a t , “ [ w ] h e n t h e s e c o m p e t i n g c l a i m s [ f o r i n d e m n i t y ] 7
a r e p u r s u e d , H u d i b u r

g e x p l a i n s t h a t t h e b u r d e n [ t o i n d e m n i f y ] w i l l u l t i m a t e l y f

a l l o n t h e p a r t y w h o s e p r o d u c t i s f o u n d t o b e d e f

e c t i v e . ” A n t e a t

_ _ _ ( e m p h a s i s a d d e d )

. W e h a v e r e p e a t e d l y h e l d , i n c l u d i n g i n H u d i b u r g , t h a t t h e d u t y t o i n d e m n i f y i s t r i g g e r e d b y a n a l l e g a t i o n , n o t a f i n d i n g , t h a t a p r o d u c t i s d e f e c t i v e . H u d i b u r

g , 1 9 9 S

. W

. 3 d a t 2 5 6

. A f i n d i n g t h a t t h e s e l l e r i s i n d e p e n d e n t l y l i a b l e w i l l c r e a t e a n e x c e p t i o n t o t h e o t h e r m a n u f a c t u r e r ’ s d u t y t o i n d e m n i f y , b u t e a c h m a n u f

a c t u r e r ’ s d u t y t o i n d e m n i f y e x i s t s r e g a r d l e s s o f w h e t h e r i t s p r o d u c t i s “ f o u n d t o b e d e f

e c t i v e . ” A n a l l e g a t i o n t r i g g e r s t h e d u t y ; a f

i n d i n g t r i g g e r s t h e e x c e p t i o n , n o t t h e d u t y . 9Continui ng to overlook the limit s on the scope of indemnity in a multipl e products action,

the C ourt g oes on to hold that, based on the alleg ations in this case that Tit efle x ’s flex connec tor (the component product) and Petroleum Soluti ons’ fuel sy st em (t h e finished product) wer e both defe ctive, Petroleum Soluti ons had a duty to indemnify Titefl ex “f or losses arising out of this products liabili ty action , to the extent Titeflex was not independe ntly liable for those losses.” Ante
at ___ (empha sis added)

. That is simply not how we have construed the statute in Hudiburg or any of our o t h er multipl e-pr oduct case s. Consist ent with our holding in Hudiburg , I would hold that Petroleum Soluti ons had a duty to indemnify Titeflex for losses rela ted to alleg ations that the fuel
sy stem (Petroleum Soluti ons’ finished product) was defe ctive, b u t not for losses rela ted to alleg ations that the flex connec tor (Titefle x ’s component product) was defe ctive. Be cause Titeflex incurre d all of i ts losses defe nding only ag ainst alleg ations that the flex connec tor was de fec tive, the scope of Petroleum Solutions’ duty to indemnify

does not enc ompass those losses.
I f t here were any doubt about our holding in Hudiburg reg arding the l imited scope of the duty to indemnify in an action involving multipl e alleg edly defe ctive products, this Court resolved that doubt in Owens & Minor, Inc. v. Ansell Healthcare Products, Inc. , 251 S.W .3d 481, 482 (Tex. 2008). I n Owens & Minor we held that the s tatute “does not require a manuf actur er to indemnify

a distributor ag ainst claims involving products other manufa cture rs rele ased into the st re am o f

commerc e.” Id

. at 482. We e x plained that, “while it is corr ect that the claimant’s petition trig g ers

eac h manufa cture r’s duty to indemnify an innocent seller under S ection 82.002,” it is the s tatute, and not the petition, that “def ine[s] the scope of that duty .” Id. at 484. Fro m the lang uag e of the statute, we conclude d “it is unmistakable that the duty under Section 82.002 is premised on a nexus
1 0betwee n a g iven manufa cture r and its product.” Id

. at 485. Thus, we explained, manufa cture rs “ca n be ‘manufa cture rs’ under Section 82.002 only with respe ct to their own products,” beca use section
82.002 does not “re quire a manufa cture r to indemnify a seller for claims relating to products it did not produce .” Id. at 485 & n.2 (empha sis added).
Our construction of the statute in Owen s & Mi nor relies on and confirms our holding in Hudiburg that the s cope of the m anufa cture r’s duty to indemnify in a m ultiple-products action is limit ed to a seller’ s losses that are rela ted to the manufa cture r’s alleg edly defe ctive product. Id. at 485 n.2 (holding that section 82.002 does not “re quire a manufa cture r to indemnify a seller for claims relating to products it d id n o t p r oduce ”) (empha sis added) ; Hudiburg , 199 S.W .3d at 261–62 (holding that “sec tion 82

. 0 02 does not impose on a component-pr oduct manufa cture r a duty to indemnify for losses due to alleged defec ts unrelated to its compone nt ”) (empha sis added)

. As we explained when the Owens & Minor case came bef o re u s a second time, “[w]e held in Owens &
Minor that manufa cture rs must indemnify and hold harmless an innocent seller only for the portion of the defense associate d with [t he manufa cture rs’] own products.” Ansell Healthcare Prods., Inc. v. Owens & Minor , 251 S.W .3d 499, 500 (Tex. 2008) (empha sis added). The Court conclude s today that it is “improper ” to apply our holding in Owens & Minor to the prese nt case beca

use Owens & Minor “involved a one-w ay duty to indemnify owed by multipl e manufa cture rs to a non-manufa ctur ing seller for its losses,” while the prese nt case involves “compe ting duties to indemnify o wed to eac h other by a finished-produc t manufa cture r and a component-pr oduct manufa cture r.” Ante at ___. But that is not what we said in Owens & Minor

. To the contra

ry , in Owens & Minor we defe nded our relianc e on Hudiburg ’s discussion of the scope
1 1of the duty to indemnify by reje cting the arg ument (which the Court itself makes today ) that there is a substantive differ ence betwee n the two ty pes of multipl e-pr oduct case s. “While this case does
not involve the duty of a manufa cture r of component parts,” we explained, “the principle we applied in Hudiburg rema ins the same. There is n o s ubstantive differ ence betwee n the position of the component-pa

rt manufa cture r in Hudiburg and the position of [t he product manufa cture rs] in this

case .” Owens & Minor , 251 S.W .3d at 485. “I n both in s t an ce s , ” we conclude d, “it would be
contra ry to the L eg islature’s intent to require a defe ndant to indemnify a seller for claims regarding products the defendant ne ver m anufactured .” Id . at 486 (e mphasis added)

. III. Appli cation Apply ing these principles in the presen t ca s e, I would hold that section 82.002 does not impose on Petroleum Soluti ons a duty to indemnify Titeflex for the fee s and expenses that Titeflex incu rr ed in this case , beca use Tit efle x incurre d all of i ts losses defe nding ag ainst alleg ations that Titeflex’s own flex connec tor was defe ctive, not alleg ations that Petroleum Soluti ons’ fuel sy stem was defec tive. Petroleum S o l u tions arg ues t hat Head’s claims ag ainst Titeflex “complaine d only of Titeflex’[s ] product, and did not seek damag es from Titeflex unr elated to alleg ations of defe cts in Titeflex’s component.” I ag ree . When Petrol eu m S o l u t ions joined Titeflex as a third-par ty defe ndant, it a lleg ed only that a defec tive flex connec tor manufa cture d by Titeflex had cause d the leak. When Hea d amende d his petition to as s er t a claim direc tly ag ainst Titeflex, he alleg ed that “Titefle x manufa cture d the flex connec tor” and that “Titefle x is strictly liable for damag es cause d by the def ective f lex connector.”

1 2Her e, as the m ajority notes, “bec ause the fuel sy stem is a product, Petroleum Solutions is

the manufa cture r of that product, and Titeflex is the innocent seller of a component part alleg edly used i n Petroleum Soluti ons’ defective f inished product,” ante at ___, Petroleum S olutions has a statutory duty to indemnify Titeflex. But the majority ends its analy sis there , instead of continuing

on to addre ss the questi o n o f wh et her the scope of Petroleum Soluti ons’ duty encompa sses Titeflex’s losses. The Court overlooks our holdings in Hudiburg and in Owens & Minor reg arding the scope of the duty

to indemnify , and thus misses the ef fec t of the fa ct that the losses for which Titeflex seeks indemnity all arise from alleg ations that Titeflex’s component part, and not Petroleum Soluti ons’ fue l sy stem, was def ective. Under Hudiburg and Owens & Mi n o r , t he scope of the duty the statute imposed on Petroleum Soluti ons’ to indemnify Titeflex did not extend to losses that Titeflex incurre d as a result of claims that a different product—the flex connec tor that Titeflex manufa cture d—was defe ctive. Titeflex was sued only for alleg ed defe cts in th e fl ex co n nector , and I ag ree with Petroleum Soluti ons that, under our constructions of the statute in Fitzgerald , Hudiburg , and Owens & Minor , Petroleum Soluti ons could not be liable to inde mnify Titeflex for losses rela ting to a pr oduct that Petroleum Soluti ons did not manufa cture

. I would hold that Petroleum Soluti ons must indemnify Titeflex “only for the portion of the defe nse associate d with [P etroleum Soluti ons’] own products.” Ansell Healthcare Prods. , 251 S.W .3d at 500. Under this c onstruction of section 82.002, Petroleum Soluti ons is a “manuf actur er” under chapte r 82 only

with respec t to the product it manufac tured: the underg round fuel sy stem. See id. Petroleum Soluti ons did not desig n, formulate, c onstruct, re build, fabricate, produc e, compound,

1 3proce ss, or assemble the flex connec tor. Petroleum S olutions was a manufa cture r wit h respe ct t o

the finished product but it was not a manufa cture r with respe ct to the flex connec tor. See id

. I ag ree that Petroleum Soluti ons would there fore have a duty to indemnify a seller like Titeflex aga i nst losses arising out of alleg ations that the finished product was defe ctive, but the scope of its duty to indemnify Titeflex does not extend to losses arising out of the allega tions that the flex connec tor itself was defe ctive. S

ee i d. ; Owens & Minor , 251 S.W .3d at 485–86. Titeflex there fore has no losses for whic h Petroleum Soluti ons owes a sta tutory duty to indemnify

Titeflex.
IV. Conclusion Section 82.002 require s “[a] manufa cture r” to indemnify “a seller” ag ainst losses arising out of “a products liability action,” which means an action ag ainst “a manufa cture r or seller” to rec over damag es alleg edly cause d by “a defe ctive product.” T E X
. C I V
. P R A C
. & R E M
. C O D E §§ 82.001(2), 82.002(a)

. The statute’s silence on how this duty applies when a products liability action includes alleg ations that more than one product is defe ctive prese nts sever al issues that are difficult to resolve. But we have alre ady done our be st to resolve them, rely ing on our observa tion that “it is unmistakable that the duty under Section 82.002 is premised on a n exus betwee n a g iven manufa cture r and its product.” Owens & Minor , 251 S.W .3d at 485. We have thus held that, in multipl e-pr oducts case s, the scope of eac h manufa cturer’ s d u t y includes only those losses that a seller incurs rela ted to the manufa cture r’s product, and does not include losses that anot h er manufa cture r incurs de fending claims that its own product wa s defe ctive. Be cause Titeflex seeks indemnity only for losses that it incurre d defe nding claims that its own product was defe ctive, I

1 4disag ree with the Court’s holding that Petroleum Soluti ons’ has a duty to indemnify Titeflex under

section 82.002, and I

dissent from that portion of the Court’s judg ment.

_________________________________ J eff rey S. Boy d J ustice Opinion delivere d: J uly

11, 2014

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