IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

BERRYMAN PRODUCTS, INC., §

§

Plaintiff, §

§

VS. § NO. 4:04-CV-771-A

§

ADDITIVES, INC., §

§

Defendant. §

MEMORANDUM OPINION

and

ORDER

Came on for consideration the motion of third-party

defendant, Ashland, Inc. ("Ashland"), for summary judgment. The

court, having considered the motion, the response of defendant

Additives, Inc. ("Additives"), the response of plaintiff,

Berryman Products, Inc., the reply, the record, the summary

judgment evidence, and applicable authorities, finds that the

motion should be granted in part.

I.

Pending Claims

On August 30, 2004, plaintiff filed its original petition

against Additives in the 236th Judicial District Court of Tarrant

County, Texas. Briefly, plaintiff alleged that it is in the

business of selling chemical products for use in the automotive

industry; that plaintiff ordered from Additives certain blended

chemicals that were represented by Additives to be phosphate-free

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 1 of 13 PageID 1711
2

and that could be utilized in metal aerosol containers; that

Additives subsequently contracted with Ashland to provide the

blended chemicals to plaintiff; that the blended chemicals

provided by Ashland did not have the same composition and match

the specifications of the samples previously provided by

Additives; that the aerosol containers in which the product was

sold leaked and exploded, damaging not only the products but

other property in the stores in which the cans were sold; and

that plaintiff has suffered expense, loss of revenue, and loss of

business reputation as a result. Plaintiff sued Additives for

negligence, breach of warranties, and breach of contract.

On October 22, 2004, Additives filed its notice of removal,

bring the action before this court. On November 18, 2004, having

first obtained leave of court, Additives filed its third-party

complaint against Ashland. Additives alleges that, if it is

liable to plaintiff, Ashland is liable to Additives, because

Ashland supplied the blended chemicals. Additives sues Ashland

for negligence, breach of warranties, and breach of contract.

On March 25, 2005, having first obtained leave of court,

plaintiff filed its first amended complaint adding as defendants

Silco Distributing Company, Inc., Richard A. Silverberg, and

Ashland. Plaintiff sues Ashland for negligence, breach of

implied warranties, and violation of the Texas Deceptive Trade

Practices--Consumer Protection Act, Tex. Bus. & Com. Code Ann. §§

17.41 - .63 (Vernon 2002) ("DTPA").

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 2 of 13 PageID 1712
3

II.

Grounds of the Motion

Ashland asserts numerous grounds in support of its motion

for summary judgment. It contends that neither plaintiff nor

Additives can prevail on their claims against it. The grounds

will be set forth, infra, along with the discussion of each.

III.

Applicable Summary Judgment Principles

A party is entitled to summary judgment on all or any part

of a claim as to which there is no genuine issue of material fact

and as to which the moving party is entitled to judgment as a

matter of law. Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 247 (1986). The moving party has the initial

burden of showing that there is no genuine issue of material

fact. Anderson, 477 U.S. at 256. The movant may discharge this

burden by pointing out the absence of evidence to support one or

more essential elements of the non-moving party's claim "since a

complete failure of proof concerning an essential element of the

nonmoving party's case necessarily renders all other facts

immaterial." Celotex Corp. v. Catrett, 477 U.S. 317, 323-25

(1986). Once the moving party has carried its burden under Rule

56(c), the non-moving party must do more than merely show that

there is some metaphysical doubt as to the material facts. 

Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S.

574, 586 (1986). The party opposing the motion may not rest on

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 3 of 13 PageID 1713
4

mere allegations or denials of pleading, but must set forth

specific facts showing a genuine issue for trial. Anderson, 477

U.S. at 248, 256. To meet this burden, the nonmovant must

"identify specific evidence in the record and articulate the

'precise manner' in which that evidence support[s] [its]

claim[s]." Forsyth v. Barr, 19 F.3d 1527, 1537 (5th Cir. 1994). 

An issue is material only if its resolution could affect the

outcome of the action. Anderson, 477 U.S. at 248. Unsupported

allegations, conclusory in nature, are insufficient to defeat a

proper motion for summary judgment. Simmons v. Lyons, 746 F.2d

265, 269 (5th Cir. 1984).

The standard for granting a summary judgment is the same as

the standard for rendering judgment as a matter of law. Celotex

Corp., 477 U.S. at 323. If the record taken as a whole could not

lead a rational trier of fact to find for the non-moving party,

there is no genuine issue for trial. Matsushita, 475 U.S. at

597. See also Boeing Co. v. Shipman, 411 F.2d 365, 374-75 (5th

Cir. 1969) (en banc) (explaining the standard to be applied in

determining whether the court should enter judgment on motions

for directed verdict or for judgment notwithstanding the

verdict). 

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 4 of 13 PageID 1714
5

IV.

Undisputed Evidence

The following is an overview of evidence pertinent to the

motion for summary judgment that is undisputed in the summary

judgment record:

In February 2002, plaintiff entered into an agreement with

Additives to purchase certain blended chemicals, known as

"locomotive cleaner" from Additives. Plaintiff intended to

repackage the locomotive cleaner and resell it to retailers such

as Auto Zone. Locomotive cleaner was Additives' proprietary

product. Additives would not, and did not, disclose to plaintiff

its formula. Plaintiff was prohibited from performing any sort

of compositional analysis on the cleaner. Plaintiff contends

that it told Additives that plaintiff intended to sell the

cleaner in aerosol cans. No Ashland representative was present

during the negotiations between plaintiff and Additives, and

Ashland played no role in their negotiations.

After supplying the cleaner to plaintiff for awhile,

Additives determined that it would be more cost effective for the

chemicals to be blended locally by Ashland and delivered to

plaintiff. Ashland agreed to blend and supply the chemicals in

conformance with specifications and blending instructions

provided by Additives and agreed not to deviate from those

specifications. Plaintiff's only communications with Ashland had

to do with the logistics of the order process. Ashland never

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 5 of 13 PageID 1715
6

made any oral or written representations to plaintiff regarding

the chemicals it delivered to plaintiff.

Upon receipt of shipments of the chemicals, plaintiff added

a propellant and packaged the product in aerosol cans. Additives

did not tell Ashland that the blended chemicals were going to be

utilized by plaintiff in metal aerosol cans. During the summer

of 2003, at a time when Ashland was supplying the blended

chemicals to plaintiff, the aerosol cans began to leak and, in

some cases, explode. Damage occurred not only to the products

themselves, but to their surroundings. A single cause for the

can failures has not been identified. Testing showed low pH

levels in the blended chemicals delivered by Ashland.

V.

Law Applied to the Facts

A. Plaintiff's Negligence Claim

To prevail on its claim of negligence, plaintiff must show

that Ashland owed it a legal duty, that Ashland breached that

duty, and that plaintiff was proximately damaged by the breach. 

D. Houston, Inc. v. Love, 92 S.W.3d 450, 454 (Tex. 2002). 

Proximate cause requires cause in fact and foreseeability. Id.

An act is foreseeable if a person of ordinary intelligence should

have anticipated the dangers his negligent act would create for

others. Id. To show cause in fact, plaintiff must prove that an

act or omission was a substantial factor in bringing about its

injury and that the injury would not have occurred without the

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 6 of 13 PageID 1716
 

1

Had Ashland simply argued that it owed plaintiff no duty, the

outcome might have been different. That is a subject that the

parties should be prepared to address at the pretrial conference on

August 1, 2005.

 

2

Had Ashland simply argued that plaintiff could not adduce

evidence to support a finding of foreseeability contemplated by

proximate cause, it might have prevailed. That, too, is a subject

that the parties should be prepared to address at the pretrial

conference.

7

act or omission. Excel Corp. v. Apodaca, 81 S.W.3d 817, 820

(Tex. 2002). Plaintiff must have evidence to establish cause in

fact; mere conjecture, guess, or speculation is insufficient. 

Id.

Ashland contends in its motion for summary judgment that it

did not breach any duty to plaintiff, because it blended the

chemicals in accordance with specifications provided by

Additives.1 Alternatively, Ashland argues that there is no

evidence that it caused any damage to plaintiff since the

chemicals it supplied met the specifications.2 As for the first

ground, summary judgment evidence raises a genuine fact issue as

to Ashland's compliance with the specifications provided by

Additives. Testing by plaintiff as well as Ashland shows that pH

levels in the chemicals blended by Ashland were below

specification. Further, there is a genuine issue of material

fact as to the validity of the certificates of analysis upon

which Ashland relies. Ashland's second ground, based on the same

allegations as the first, i.e., that it met the specifications

given by Additives, fails for the same reasons.

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 7 of 13 PageID 1717
 

3

Because plaintiff has not come forward with evidence of a

defect, the court need not reach the issues of notice and opportunity

to cure.

8

B. Plaintiff's Claim For Breach Of Implied Warranty Of 

Merchantability

To prevail on its claim for breach of implied warranty of

merchantability, plaintiff must show that Ashland sold it goods,

that the goods were unmerchantable, that plaintiff notified

Ashland of the breach, and that plaintiff suffered injury. Tex.

Bus. & Com. Code Ann. §§ 2.314; 2.607(c)(1); 2.714; 2.715 (Vernon

1994). With regard to this claim, Ashland's summary judgment

grounds are that there is no evidence that the blended chemicals

were unmerchantable when they left Ashland's possession, that

plaintiff did not give Ashland notice of a breach of warranty,

and that plaintiff did not give Ashland a reasonable opportunity

to cure.

Ashland's argument with regard to the first ground is that,

because the blended chemicals it supplied to plaintiff met

Additives' specifications, there is no evidence that the blended

chemicals were unmerchantable. As previously discussed, however,

the evidence does not establish that the chemicals Ashland

supplied met the necessary specifications. Nevertheless,

plaintiff has not pointed to any evidence to show that the

blended chemicals were unfit for ordinary purposes, i.e., for use

as a cleaner, at the time Ashland delivered them. See Plas-Tex,

Inc. v. U.S. Steel Corp., 772 S.W.2d 442, 444 (Tex. 1989).3

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 8 of 13 PageID 1718
9

C. Plaintiff's Claim For Breach Of The Implied Warranty Of

Fitness For Particular Purpose

The Uniform Commercial Code provides, in pertinent part:

Where the seller at the time of contracting

has reason to know any particular purpose for

which the goods are required and that the

buyer is relying on the seller's skill or

judgment to select or furnish suitable goods,

there is unless excluded or modified under

the next section an implied warranty that the

goods shall be fit for such purpose.

Tex. Bus. & Com. Code Ann. § 2.315 (Vernon 1994).

With regard to this claim, Ashland urges in its summary

judgment motion that it had no knowledge of any particular

purpose for which plaintiff would use the blended chemicals, that

there is no evidence that plaintiff could have relied on

Ashland's skill and judgment in selecting goods for any

particular purpose, and that plaintiff failed to notify Ashland

of the breach of warranty or give it an opportunity to cure. 

Plaintiff's response in this regard is not much of a response at

all. Its speculation about what Ashland might have known is

insufficient to raise a genuine fact issue with regard to the

claim for breach of implied warranty of fitness for a particular

purpose.

D. Plaintiff's DTPA Claim

To prevail on its claim for violation of the DTPA, plaintiff

must show that it is a consumer, that Ashland violated a specific

provision of the Act, and that the violation was a producing

cause of plaintiff's injury. Amstadt v. U.S. Brass Corp., 919

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 9 of 13 PageID 1719
10

S.W.2d 644, 649 (Tex. 1996). Ashland urges that it is entitled

to judgment on the grounds that: (1) because plaintiff's

warranty claims fail, so does its DTPA claim; (2) Ashland did not

make any representations to plaintiff; (3) plaintiff cannot prove

causation; and (4) plaintiff did not give pre-suit notice to

Ashland of its DTPA claim.

Plaintiff has not raised a genuine issue of material fact as

to either of its implied warranty claims. As for any other basis

for a DTPA claim, plaintiff has not come forward with summary

judgment evidence to show that Ashland made any representation to

it that would give rise to a DTPA claim.

E. Additives' Claim For Breach Of Contract

Ashland urges two summary judgment grounds with regard to

Additives' breach of contract claim. First, it did not breach

its contract with Additives, because it delivered chemicals that

met Additives' specifications. And, second, Additives did not

seasonably notify it of revocation of acceptance of the blended

chemicals. As earlier discussed, there is a genuine fact issue

as to whether Ashland delivered blended chemicals that met

Additives' specifications. Further, the summary judgment

evidence shows that Additives gave notice to Ashland in September

2003, as soon as it learned of the problems encountered by

plaintiff.

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 10 of 13 PageID 1720
 

4

Had Ashland focused on the foreseeability requirement of

proximate cause, the outcome might have been different. An issue to

be discussed at the pretrial conference is the standard to apply and

whether there is a genuine fact issue as to causation.

11

F. Additives' Negligence Claim

Ashland contends in its summary judgment motion that

Additives cannot prevail on its negligence claim, because (1) the

claim is precluded by the economic loss rule; (2) Ashland blended

the chemicals in accordance with specifications provided by

Additives; and (3) there is no evidence that Ashland caused

damage to plaintiff or Additives. Ashland correctly cites cases

holding that if the plaintiff's only injury is economic loss to

the subject of the contract itself, no action in negligence lies. 

See Jim Walter Homes, Inc. v. Reed, 711 S.W.2d 617, 618 (Tex.

1986); Indelco, Inc. v. Hanson Indus. N. Am.-Grove Worldwide, 967

S.W.2d 931, 932-33 (Tex. App.--Houston [14th Dist.] 1998, pet.

denied). However, the evidence here is that the loss extended

beyond the aerosol cans themselves. Second, there is evidence

that the chemicals supplied by Ashland did not conform to

Additives' specifications. And, third, the evidence is that the

aerosol cans that failed contained the blended chemicals provided

by Ashland and that Ashland's blending caused or contributed to

causing the cans to fail.4

G. Additives' Claims For Breach Of Warranty

Finally, Ashland seeks summary judgment on each of

Additives' breach of warranty claims. Additives concedes that it

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 11 of 13 PageID 1721
12

does not have a claim for breach of express warranty against

Ashland. Additives' Summ. J. Resp. at 10, ¶ 3.10. And,

Additives does not argue that it has a claim for breach of an

implied warranty of fitness for particular purpose. Id. at ¶

3.11.

As for the claim of breach of implied warranty of

merchantability, Ashland's summary judgment grounds are (1) that

the chemicals it supplied met Additives' specifications, and (2)

that Additives did not notify Ashland of any breach of warranty

or give it an opportunity to cure. The summary judgment evidence

is sufficient to raise a fact issue as to whether the blended

chemicals were merchantable in that there is evidence that they

did not meet the specifications provided by Additives. (The

goods had to meet the specifications in order to fulfill

Additives' contract with plaintiff, the purpose for which they

were procured.) And, there is evidence that Additives gave

notice to Ashland in September 2003 of the problems plaintiff was

having.

VI.

Order

For the reasons discussed herein,

The court ORDERS that Ashland's motion for summary judgment

be, and is hereby, granted in part; that plaintiff take nothing

on its claims against Ashland for breach of the implied

warranties of merchantability and fitness for particular purpose

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 12 of 13 PageID 1722
13

and for violation of the DTPA; and, that Additives take nothing

on its claims against Ashland for breach of express warranty and

breach of implied warranty of fitness for particular purpose.

The court FURTHER ORDERS that at the pretrial conference in

this action, the court will conduct a hearing as contemplated by

Rule 56(d) of the Federal Rules of Civil Procedure, at which time

plaintiff shall be prepared to present any evidence, argument and

authorities it has on the subjects of whether Ashland owed it any

duty and whether the element of causation can be established, and

Additives shall be prepared to present any evidence, argument and

authorities it has on the subject of causation and whether

causation can be established.

SIGNED July 27, 2005.

 /s/ 

JOHN McBRYDE

United States District Judge

 

 Case 4:04-cv-00771-A Document 65 Filed 07/26/05 Page 13 of 13 PageID 1723