PUBLISH

UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT

________________ _________________

MARTIN K. EBY CONSTRUCTION COMPANY, INC., Plaintiff - Appellee,

v. ONEBEACON INSURANCE COMPANY, as successor to Commercial Union Insurance Company, Defendant,
and KELLOGG BROWN & ROOT, LLC, Defendant - Appellant.

---------------------------- ---------------------- CONTINENTAL CASUALTY COMPANY; NATIONAL FIRE INSURANCE COMPANY OF HARTFORD, as successor by merger with Transcontinental Insurance Company; COLUMBIA CASUALTY COMPANY; VALLEY FORGE INSURANCE COMPANY, Plaintiffs,

v. No. 13-3076 (D.C. No. 6:08- CV-01250-MLB) FILED United States Court of Appeals Tenth Circuit 

### February 3, 2015
Elisabeth A. Shumaker Clerk of Court2 ONEBEACON INSURANCE COMPANY, as successor to Commercial Union Insurance Company, Defendant,
and
TRAVELERS CASUALTY AND SURETY COMPANY, as successor to Aetna Casualty and Surety Company; UNITED STATES FIDELITY AND GUARANTY COMPAN Y; ST. PAUL FIRE AND MARINE INS. CO.; ATHENA ASSURANCE COMPANY; MARTIN K. EBY CONSTRUCTION COMPANY, INC., Defendants - Appellees,
and KELLOGG BROWN & ROOT, LLC, Defendant - Appellant.

________________ _________________ ORDER

________________ _________________ Before BACHARACH , McKAY , and McHUGH , Circuit Judges.

________________ _________________ This matter is before the court on appellant Kellogg Brown & Root’s Petition for Panel Rehearing . Consistent with our order dated December 31, 2014, we also have responses from the appellees. Upon consideration, we grant panel rehearing in part with respect to proposition IV in the rehearing re quest. We otherwise deny the petition in full.3 An amended opinion is attached to this orde r. The clerk is directed to substitute this opinion for the one that issued or iginally on December 9, 2014.

Entered for the Court

ELISABETH A. SHUMAKER, ClerkPUBLISH UNITED STATES CO URT OF APPEALS TENTH CIRCUIT

MARTIN K. EBY CONSTRUCTION COMPANY, INC., Plaintiff-Appellee, v. No. 13-3076

ONEBEACON INSURANCE COMPANY, as Successor to Commercial Union Insurance Company, and KELLOGG BROWN & ROOT, LLC., Defendant-Appellant.

CONTINENTAL CASUALTY COMPANY; NATIONAL FIRE INSURANCE COMPANY OF HARTFORD, as Successor by Merger with Tr anscontinental Insurance Company; COLUMBIA CASUALTY COMPANY; VALLEY FORGE INSURANCE COMPANY, Plaintiffs,

v. ONEBEACON INSURANCE COMPANY, as Successor to Commercial Union Insurance FILED United States Court of Appeals Tenth Circuit 

### February 3, 2015
Elisabeth A. Shumaker Clerk of Court2 Company,
Defendant, and

TRAVELERS CASUALTY AND SURETY COMPANY, as Successor to Aetna Casualty and Surety Company; UNITED STATES FIDELITY AND GUARANTY COMPANY; ST. PAUL FIRE AND MARINE INS. CO.; ATHENA ASSURANCE COMPANY; MARTIN K. EBY CONSTRUCTION COMPANY, INC., Defendants-Appellees, and KELLOGG BROWN & ROOT, LLC,
Defendant-Appellant.

Appeal from the United States District Court For the District of Kansas (D.C. No. 6:08-CV-01250-MLB And 2:08-CV-02392-MLB)
Lauren B. Harris, Porter Hedges LLP, Houston, Texas (David M. Rapp and Eric Barth, Hinkle La w Firm, LLC, Wichita, Kansas, and Jonna N. Summers, Porter Hedges, LLC, with her on the briefs) for PlaintiffAppellant Kellogg Brow n & Root, LLC.3 James Oliver, Foulston Siefkin LLP, Overland Park, Ka nsas (Randall K. Rathburn, Depew G illen Rathburn & McInteer LC , and Jeffery A. Jordan, Foulston Siefkin LLP, Over land Park, Kansas, with him on the brief) for Defendant-Appellee Martin K. Eb y Construction Co., Inc. Donna J. Vobornik, Denton s US LLP, Chicago, Illi nois (Geoffrey J. Repo and William T. Barker, Dentons US LLP, Chicago, Illinois, with her on the brief) for Defendants-Appel lees Travelers, et al.

Before BACHARACH , McKAY , and McHUGH , Circuit Judges.

BACHARACH , Circuit Judge.

This appeal involves indemnity and insurance. The indemnity issues arise out of a promise by Martin K. Eby Construction Company’s predecessor to build a water pipe line. To build the water pipeline, Eby engaged anot her company (the predecessor to Kellogg Brown & Root, LLC), promisin g indemnity for claims resulting from Eby’s work. While building the water pipeline, Eby accidentally hit a methanol pipeline, causing a le ak. At the time, no one knew about the leak. It was discovered over two decades later, an d the owner of the methanol pipeline had to pay for the cleanup. The owner of the meth anol pipeline sought to recover the expenses from Kellogg and Eby. Kellogg and Eby prevaile d, but Kellogg incurred4 over $2 million in atto rneys’ fees and costs. Kellogg invoked Eby’s indemnity promise, suing Eby and its liability insure r, Travelers Casualty and Surety Co. The district court granted summary judgment to Eby and Travelers, leading Kellogg to appeal. Some of our issu es involve Eby; others involve Travelers. To resolve the Kellogg -Eby portion of the ap peal, we must address the enforceability of Eby’s promise of indemnity. This promise is broad enough to cover the pipeline owner’s claims against Kellogg for its inaction after Eby caused the leak. But we can enfo rce the indemnity promise only if it was expressly stated and conspicuous. This indemnity clause was not conspicuous; thus, it is unenforceable. The Kellogg-Travelers appeal turns on Kellogg’s argument that Travelers’ insurance po licy covered liab ilities assumed by its insured (Eby).5 But, because the indemnity clause is unenforceable, it is as if Eby never agreed to assu me Kellogg’s liabilities. In th e absence of Eb y’s assumption of Kellogg’s liabilities, Trav elers did not insure Kellogg.6 Accordingly, Kellogg is not entitled to indemnity from Eby or insurance coverage from Travelers, an d Eby and Travelers were entitled to summary judgment. We affirm. I. Standard of Review We engage in de novo review over the summary judg ment rulings.
Holmes v. Colo. Coal . for Homeless Long Term Disability Plan , 762 F.3d 1195, 1199 (10th Cir. 2014). This review requires us to consider the evidence in the light most favorable to Kellogg. See Lenox MacLaren Surgical Corp. v. Medtronic, Inc. , 762 F.3d 1114, 1118 (10th Cir. 2014). Viewing the evidence in this light, we decide whether a genuine issue of material fact exists on coverage for indemnity or insurance. See SEC v. Thompson , 732 F.3d 1151, 1156-57 (10th Cir. 2013). We conclude that no such issue exists, and we affirm th e award of summary judgment to Eby and Travelers. II. Eby’s Indemnity Obli gation to Kellogg: The Fair No tice Rule Eby acknowledges that the indemnity clause covers the claims that had been asserted against Kellogg, but argues that the coverage is unenforceable. We agree.7 A. The Applicability of the Fair Notice Rule to Eby’s Promise of Indemnity To determine enforceability, we must understand th e scope of Eby’s promise. Eby promised to indemn ify Kellogg for all claims, including attorneys’ fees and expenses, “directly or indirectly arising from or caused by or in connection with the performance or failure to pe rform any work” by Eby (or its predecessor). Appellant’ s App. at 504. This promise covers the pipeline owner’s clai ms against Kell ogg, but indemnity coverage is unenforceable under the fair notice rule. 1. Coverage for Kellogg’s Malfeasance Kellogg argues that Eb y’s promise covers on ly claims involving Eby’s malfeasance, not Kellogg ’s. But this is not what the cl ause says: It says that Eby will indemnify Kellogg for all claims aris ing “directly or indirectly” from Eby’s work. Thus, the indemnity clause covers claims involving Kellogg’s failur e to comply wi th a duty created by something Eby had done. This clause fits our facts. Eby hit the methanol pipeline and caused the leak, and the pipeline owner clai med that Kellogg s hould have taken corrective action. Thus, the clai ms involved Kell ogg’s wrongdoing, not Eby’s. But Kellogg allegedly incurred a duty only because Eby had caused a leak. Thus, the indemnity clause is broad enough to co ver the pipeline8 owner’s claims against Kellogg for Kellogg’s fault (fa ilure to take corrective action). The resulting issu e is the enforceability of that promise. The parties ag ree that enforceability is governed by Texas law, which restricts indemnity clauses through the “fai r notice rule.” 2. Kellogg’s Arguments Kellogg makes two challeng es to the applicability of the fair notice rule:

● The fair notice rule does not apply because Kellogg is seeking indemnity for Eby’s conduct, not Kellogg’s.

● The jury attributed fa ult to Eby, not Kellogg. We reject both arguments. Kellogg characterizes the pipeline ow ner’s claims as stemming from the damage to the pipeline and points out that the jury attributed that damage to Eby. Because all of the claims ca n be traced to Eby’s conduct, Kellogg argues that it is seeking indemnity for Eby’s actions, not Kellogg’s. As disc ussed above, the pipeline owner su ed Kellogg for its inaction after Eby had caused the leak. Th us, our indemnity issues are unaffected by th e jury’s finding that Eb y had caused the leak. 3. Absence of a Referen ce to Kellogg’s Fault Though the indemnity clause applies, it does so implicitly rather than explicitly because there is no mention of coverage for claims involving the9 indemnitee’s fault. Thus, we must as k: Does the fair notice rule apply when the indemnity clause covers the indemnitee’s fault implicitly, but not explicitly? We conclude the fa ir notice rule applies in these circumstances. The indemnity clause cove rs all claims arising di rectly or indirectly from Eby’s acts. This la nguage is broad e nough to cover cl aims involving Kellogg’s failure to take action once Eby damaged the pi peline. Because the indemnity clause covers claims ag ainst Kellogg for its own fault, the fair notice rule applies und er Texas law. The rule applies even though the indemnity clause doesn’t explicitly mention claims involving Kellogg’s fault. In applying the fair notice rule in these circumstances, we are guided by two of the Texas Supreme Court’s d ecisions applying a re lated rule (the “express negligence rule”): Ethyl Corp. v. Daniel Construction Co. , 725 S.W.2d 705 (T ex. 1987), and Fisk Electric Co. v. Constructors & Associates, Inc. , 888 S.W.2d 813 (Tex. 1994).
In Ethyl , the court held that the express negligence rule applied when the claims involved th e indemnitee’s fault. Ethyl Corp. , 725 S.W.2d at 708. The promise in Ethyl broadly covered damages incurred because of10 the indemnitor’s conduct. Id. at 707. 1 But the claims involved the indemnitee’s fault. Id. Under the express negligen ce rule, a party seeking indemnity from the consequences of its own negligence must specifically express that intent in the four corners of the contract. Id. This restriction applied even though the contractual indemnific ation clause had not referred to coverage for the indemnitee’s fault. Id. Thus, the Texas Supreme Court concluded that the expre ss negligence rule applies when an indemnity clause implicitly covers claims involving the indemnitee’s fault.
Id. The indemnity language in Fisk was similar. Ther e the clause stated that Fisk “‘shall indemnify . . . [Con structors] . . . fr om and against all claims, damages, losses, and expe nses, including but not limited to attorney’s fees . . .’ ar ising out of or resulting from the performance of Fisk’s work.” Fisk Elec. Co. v. Constructors & Assocs., Inc. , 888 S.W.2d 813, 814 (Tex. 1994). Though the indemnity clause did not mention the

1 The Ethyl agreement stated: Contractor shall indemnify and hold Owner harmless against any loss or damage to person s or property as a result of operations growing out of the pe rformance of this contract and caused by the negligence or carelessness of Contractor, Contractor’s employees, Subc ontractors, and agents or licensees. Ethyl Corp. , 725 S.W.2d at 707.11 indemnitee’s (Constructors’) fault, the Texas Supreme Court applied the express negligence rule b ecause the claims involved the indemnitee’s fault.
Id. at 815. Our case resembles Ethyl and Fisk

. 2 Eby’s promise of indemnity does not mention Kellogg’s fault. Instead, the clause promises to indemnify Kellogg for money spent defending claims caused by Eby’s conduct. This la nguage is broad e nough to reach the pipeline owner’s claims that

● resulted indirectly from Eby’s conduct

● even though the coverage is fo r claims involving Kellogg’s own actions. Under Ethyl and Fisk , the fair notice rule can cover promises of indemnity bearing no mention of claims involving the indemnitee’s fault.

2 Kellogg relies on English v. BGP International, Inc. , 174 S.W.3d 366 (Tex. App. 2005). Kellogg’s Opening Br. at 22. Ther e the court held that the fair notice rule did not apply, distinguishing Fisk

. English , 174 S.W.3d at 375. The co urt explained that in Fisk , the express negligence rule applied because the only claim ag ainst the indemnitee was based on its negligence. Id. In English , however, the only claims against the indemnitee were based on the indemnitor’s negligence, not the indemnitee’s. Id. As discussed in the te xt, the distinction in Fisk applies equally here. Like the indemnity clause in Fisk , our clause serves to indemnify the indemnitee (Kellogg) for any claims resulting from the indemnitor’s (Eby’s) acts. But, like the claimant in Fisk , our indemnitee (Kellogg) is being sued only fo r its own misconduct, not the indemnitor’s (Eby’s). Thus, Kellogg’s reliance on English is misplaced.12 Thus, we must apply the fair notice rule even though the in demnity clause does not refer to claims involving the indemnitee ’s (Kellogg’s) fault. B. The Requirements of the Fair Notice Rule We apply the fair notice rule to decide if the indemnity clau se can be enforced. Under this rule, promises to indemnify a part y for its own fault must be expressly stated and conspicuous. See Dresser Indus., Inc. v. Page Petroleum, Inc. , 853 S.W.2d 505, 508 (Tex. 1993). C. Applicability of th e Fair Notice Rule to the Pipeline Owner’s Claims Kellogg has sought indemnity for its f ees and expenses to defend five claims:

● fraud,

● nuisance,

● restitution,

● violation of a federal environmental statute, and

● violation of a state environmental statute. The fair notice rule cove rs application of the in demnity clause for each claim.13 1. Fraud The parties debate the applica tion of the fair notice rule to intentional torts, like fra ud. We conclude that th e fair notice rule applies to contractual indemn ification for fraud. The Texas Court of Appeals has held that the fair notic e rule restricts clauses indemnifying a party for its intentional torts. Hamblin v. Lamont , 433 S.W.3d 51, 57 (Tex. App. 2013). Though th is holding does not bind us, it does provide guidance. RSR Corp. v. Int’l Ins. Co. , 612 F.3d 851, 857-58 (5th Cir. 2010). The Texas court’s reas oning makes sense: If Texas public policy rest ricts indemnity clause s covering a party’s negligence, there would be even greater reason to restrict indemnity for a party’s intentional wrongdoing. Kellogg denies the applicability of the fair notice rule to claims involving intentiona l torts, relying on DDD Energy, Inc. v. Veritas DGC Land, Inc. , 60 S.W.3d 880 (Tex . App. 2001), and English v. BGP International, Inc. , 174 S.W.3d 366 (Tex . App. 2005). Kellogg’s Opening Br. at 33 n.9; Kellogg’s Reply Br. at 9. In these cases , however, the fair notice rule didn’t apply because the contracts indemnified the indemnitees for the indemnitors’ intentional torts, not the indemnitees’. DDD Energy,
Inc. , 60 S.W.3d at 882; English , 174 S.W.3d at 369. As discussed above,14 our indemnity clause covered claims involving the indemnitee’s (Kellogg’s) torts. Thus, DDD Energy and Veritas do not affect our issue. In these circumstances, we take our guidance from the Texas Court of Appeals and conclude that the fair no tice rule applies to the claim against Kellogg for fraud. 2. Nuisance Kellogg was sued not on ly for fraud, bu t also for nuisa nce. That claim required proof of

● negligent or intentional invasion of interests or

● abnormal conduct out of place in the surroundings. City of Tyler v. Likes , 962 S.W.2d 489, 503 (Tex. 1997). Re gardless of the claimant’s method of proof, the fair notice rule would apply. Under Texas law, the fair notice rule applies equally to claims involving negligence, 3 intentional conduct, 4 and abnormal activity (strict liability). 5 Therefore, the rule would appl y to all variants of a nuisance

3 See Leonard v. Alum inum Co. of Am. , 767 F.2d 134, 137 (5th Cir. 1985) (applying Texas law).

4 See part II(C)(1), above.

5 See Hanson Aggregates W., Inc. v. Ford , 338 S.W.3d 39 , 46 (Tex. App. 2011) (describing nuisance, ba sed on activity out of place in the surroundings, as “essentia lly a form of strict -liability nuisance”); see also Hous. Lighting & Power Co. v. Atch ison, Topeka, & San ta Fe Ry. Co. , 89015 claim. In these circumstances, we conc lude that the fair notice rule applies to the pipeline owner’s claim against Kellogg for nuisance. 3. Federal and State Environmental Statutes The owner of the meth anol pipeline al so sued Kellogg for violation of

● the Comprehensive Environmen tal Response, Compensation and Liability Act of 1980, 94 Stat. 2767, as amended , 42 U.S.C. §§ 9601 et seq . (“C.E.R.C.L.A.”) and

● the Texas Solid Waste Disposal Act, Tex. Health & Safety Code Ann. §§ 361 .001-.992 (“S.W.D.A.”). These claims also fall under Texas’s fair notice rule. C.E.R.C.L.A. and the S.W.D.A. apply to owners, operators, and arrangers. 42 U.S.C. § 9607(a)(1), (a)(3); Tex. Health & Safety Code § 361.271(a)(1), (a)(3). Fo r owners and operators, th e statutes create strict liability. See Celanese Corp. v. Martin K. Eby Const. Co. , 620 F.3d 529, 532 (5th Cir. 2010). Bu t the pipeline owner didn ’t suggest that Kellogg was an owner or operator of the pipeline; the pipeline owner characterized Kellogg as an “arranger.” Kellogg could qualify as an “arra nger” only if it had taken “intentional steps to di spose of a hazardous substance.”

S.W.2d 455, 459 (Tex . 1994) (“[W]e hold that parties to an indemnity agreement must expressly st ate their intent to cove r strict liability claims in specific terms.”).16 Burlington N. & Santa Fe Ry. Co. v. United States , 556 U.S. 599, 611 (2009). Based on this definition of “arrang er,” the parties disagree over the characterization of these claims: Kellogg says th ey involve intentional torts; Eby says they involve strict lia bility. But we have already concluded that Texas’s fair no tice rule applies to both types of claims . Thus, we need not decide whether th e pipeline owner’s claim invo lves strict liability or an intentional tort. Eith er way, the fair notic e rule would apply. 4. Restitution The owner of the metha nol pipeline also sued Ke llogg for restitution. Restitution is a remedy rather than a theory of liability. See McCullough v. Scarborough, Medlin & Assocs., Inc. , 435 S.W.3d 871, 891 (Tex. App. 2014) (“[U]njust enrichment is not an independent clai m; rather it is a theory of recovery .”). But, in its reply brief, Kellogg characterizes the restitution claim as a qu asi-contract theory, sugg esting that it should be treated like a conventional contract cl aim. Kellogg’s Reply Br. at 10. According to Kellogg, this characterization would prevent application of the fair notice rule. Id. We reject this argument. Restitution does not pr ovide an independ ent theory of liability; thus, Texas courts have not had any reason to confront applicab ility of the fair17 notice rule to restitution claims. Restitution would simply describe the remedy being proposed (disgo rgement of the benefits retained by Kellogg) for tortious conduct. As discussed above, the fair notic e rule applies to claims involving the indemnitee’s negligence, intentional torts, strict liability, nuisance, and violation of C.E.R.C.L.A. and the S.W. D.A. Because the fair notice rule applies to these theories of liability, the rule applies equally to the remedies (like restitution). D. Failure to Satisfy the Fair Notice Rule ’s Requirement of Conspicuousness In these circumstances, we must apply the fair notice rule to Kellogg’s indemnity claim. Applying the rule, we conclude the indemnity clause is unenforceable b ecause it is no t conspicuous. 6
1. The Fair Notice Rule’s Requirement of Conspicuousness As discussed above, indemnity clauses are enforceable only if they expressly and conspicuousl y state that they cove r claims based on the indemnitee’s fault. See part II(B), above. Becaus e we conclude that Eby’s promise was not conspicuous, it is unenforceable.

6 The district court held that the indemn ity clause did not satisfy the express negligence requir ement, but did not addr ess the conspicuousness requirement. Nonetheless, we can affirm on this ground if it is supported by the record. Citizen Center v. Gessler , 770 F.3d 900, 909 (10th Cir. 2014).18 In its reply brief, Ke llogg argues that the inde mnity clause satisfied the requirement of cons picuousness. Kellogg’s Reply Br. at 14. We disagree. As noted above, the fa ir notice rule re quires an indemnity clause to be conspicuous. See part II(B), above. A clause is considered “conspicuous” when it woul d attract the attention of a reasonable person. Dresser Indus., Inc. v. Page Petroleum, Inc. , 853 S.W.2d 505, 511 (Tex. 1993). Texas cases provide examples of provisions that would attract attention, such as different size type, all capital letters in a heading, and different colors. See Storage & Processors, Inc. v. Reyes , 134 S.W.3d 190, 192 (Tex. 2004) (type- size and colors); Dresser Indus., Inc. v. Page Petroleum, Inc. , 853 S.W.2d 505, 511 (Tex. 1993) (all capit al letters in a heading). The indemnity language appears on page 86 of a 197 -page document. Appellant’s App. at 263. The clause, along with the rest of the document, is single-spaced, small type, and in black-and-white. There is nothing, amidst the 197 pages, to capture th e attention of a reasonable person. Kellogg argues that the indemnity clause is mentioned in another document, which is only 4 pages long. That is true. In the 4-page document, labeled “Exhibit C,” the inde mnity clause is mentioned, stating19 that Eby’s predecessor “agree[d] to be bound by all of the terms, provisions, conditions, indemnification, and liabilities imposed upon Contractor under the terms and provision s of said Contra ct Documents to the same extent as though the same were copied ve rbatim herein at length.”
Id. at 264. But, the 4-page document does not state the terms. To learn the terms of the indemnity obligation, a reader must go to “said Contract Documents” and read 86 pa ges (almost halfway into the docume nt). The table of contents and headings do not help because the indemnity clause is buried in a section th at doesn’t seem relate d to indemnity (called “Protection of Existing Stru ctures and Facilities”). Id. at 502. In short, the indemnit y clause bears none of the indicia that might typically attract a reader’s attention: The clause is on page 86 of a 197- page document, single-spaced along wi th the rest of the document, in black-and-white, without a heading that calls attention to indemnity. The clause is not conspicuous. 2. Actual Notice In a reply brief, Kellogg argues for the first ti me that Eby had actual notice of the indemnity pr ovision. Kellogg’s Repl y Br. at 11-13. We reject this argument be cause it was waived and un supported when Kellogg responded to Eby’s summa ry judgment motion.20 The argument is too late becaus e an appellant mu st present its grounds for reversal in the opening brief. Fed. R. App. P. 28(a)(8)(A). In the opening brief, Kellogg made no ment ion of “actual notice.” This issue was first raised in Kellogg’ s reply brief. Thus, Ke llogg waived the issue. See, e.g. , M.D. Mark, Inc. v. Kerr-McGee Corp. , 565 F.3d 753, 768 n.7 (10th Cir. 2009) (“[T]he gene ral rule in this circuit is that a party waives issues and arguments raised for th e first time in a reply brief.”). Kellogg’s argument is not only waived, but also unsupported. Kellogg raised the argument in district court, but failed to present any evidence that Eby’s predecessor had known th at it was promising indemnity for claims involvin g the indemnitee’s own fault. Instead, Kellogg argu ed that Eby’s prede cessor must have known about the indemnity terms because it signed a 4-page contract referring to the indemnity clause. 7 But as noted above, th e 4-page contract did not contain any terms and referred only to the indemnificatio n terms in the 197 single-spaced pa ges. The 4-page contract does not support a reasonable

7 In a surreply brief filed in district court, Kellogg a dded evidence that Eby had admitted knowledge of the indemnity agre ement. Appellant’s App. at 1289. But, the District of Kansas doe s not permit the raising of new arguments in a surreply brief. See First Specialty In s. Corp. v. NAIS, Inc. , 459 F. Supp. 2d 1094 , 1099 (D. Kan. 2006). Eby had no opportunity to address the new ar guments in either of the brie fs that it filed in district court.21 inference of actual notice regarding the indemnity terms buried in the middle of 197 pages. See Am. Home Shield Corp. v. Lahorgue , 201 S.W.3d 181, 186-87 (Tex. App. 2006 ) (holding that actual notice requires proof beyond the fact that a party read the contract before signing it). Kellogg’s argument of actual notice is waiv ed and unsupported. Thus, actual notice cannot serve as the basis for reversal. E. Effect of the Fair Notice Rule The fair notice rule i nvolves a tool of cont ract interpretation. See Fisk Elec. Co. v. Constructors & Assocs., Inc. , 888 S.W.2d 813, 814 (Tex. 1994) (“The express negligen ce requirement is not an affirmative defense but a rule of contract in terpretation.”). Because the indemnity clause is unenforceable, we read th e clause as if it didn’t cover the pipeline owner’s claims against Kellogg. See Reyes v. Storag e Processors, Inc. , 86 S.W.3d 344, 351 (Tex. App. 2002) (“[A]n empl oyee who has execu ted a liability waiver that is defective for failing to meet the fa ir notice requirements is in the same position as if he had never signed th e release, unless he had actual knowledge of the re lease’s provisions.”), aff’d , 134 S.W.3d 190 (Tex. 2004). As a result, Eby has no contractual obligation to reimburse Kellogg for its attorneys’ fe es or costs. In these circumstances, the award of summary judgment to Eby was proper.22 III. Travelers and Eby: Assump tion of Contractual Liability Kellogg sued not only Eby, but al so Eby’s insurer: Travelers. Travelers did not name Ke llogg as an insured. But Travelers apparently acknowledges that it agreed to insure parties whose liabilities were assumed by Eby in a “c overed contract.” Ke llogg contends that

● even if Eby’s promise of indemnity was unenforceable, it had been made, and

● because the promise had been made, Travelers (as Eby’s insurer) indirectly insured Kellogg for the money spent defending the pipeline owner’s claims. We disagree with Kellogg. 8 Under Texas law, we must interpre t the indemnity cl ause in a way that does not cove r damages caused by Kellogg’s fault. See part II(E), above. As discussed above, this in terpretation means that the indemnity clause does not cover the pipeline ow ner’s claims against Kellogg. And without an underlying inde mnity clause covering Kellogg’s expenses, Eby did not assume Kellogg’s liability. Therefore, Eby’s in surer (Travelers) never agreed to provide insurance to cover Kell ogg’s claims. In the absence of insurance cove rage, the district court properly gran ted summary

8 Because Travelers is not liable on other grounds, we need not decide whether there is a covered contract.23 judgment to Travelers on the claim involving Eby’s assumption of contractual liability. 9

IV. Conclusion Applying the fair no tice rule to the indemn ification clause, we conclude that Eby’s indemn ity promise was unenforceabl e. It was as if the indemnity promise had never been made. Without an enforceable indemnit y promise, Eby and Travelers are entitled to summary j udgment: Eby cannot in cur liability for an unenforceable promise, and Travelers di d not insure Kellogg . As a result, we affirm the summary judgment rulings.

9 Kellogg relies on Gilbane Building Co. v. Admiral Insurance Co. , 664 F.3d 589 (5 th Cir. 2011). But there the court was addressing coverage of the indemnitee as an “additional insured.” Gilbane Bldg. Co. , 664 F.3d at 593-96. “A contract provision that extends direct insu red status as an additional insured is deemed to be separate and independent from the indemnity agreement.” Travelers Lloyds Ins. Co. v. Pac. Emp’rs Ins. Co. , 602 F.3d 677, 682 (5th Cir. 2010). Our issue is di fferent: the effect of an unenforceable indemnity clause. Ke llogg has not rais ed the argument involved in Gilbane Building Co. : the indemnitee’s coverage as an “additional insured.”