Shipley Snell secures $70 million judgment on breach of indemnity action.

Shipley Snell has secured a judgment in excess of $70 million for its long-time client Marathon Petroleum following an eight day jury trial in Galveston County, Texas.  Marathon Petroleum and its subsidiary Blanchard Refining brought suit for contractual indemnity against industrial contractor Industrial Specialists, Inc. for damages arising from a January 2016 fire during turnaround construction at Marathon Petroleum’s Galveston Bay Refinery in Texas City.  After the fire, several ISI employees brought personal injury lawsuits in multi-district litigation against Marathon Petroleum and other non-ISI contractors on the jobsite.  ISI, however, refused to indemnify Marathon Petroleum as required by contract for its employees’ injury claims.

ISI raised several legal challenges to the enforcement of its indemnity agreement with Marathon Petroleum, including taking a permissive interlocutory appeal that reached the Texas Supreme Court. See Indus. Specialists, LLC v. Blanchard Ref. Co. LLC, 652 S.W.3d 11 (Tex. 2022), reh'g denied (Sept. 30, 2022).  

After extensive briefing by the parties, the Galveston County District Court resolved the contract interpretation issues regarding the indemnity agreement in favor of Marathon Petroleum and set the case for jury trial. The critical issue at trial was the extent of the parties’ responsibility for the injuries arising from the January 2016 fire. In May, after eight days of testimony and argument, the jury rendered a verdict apportioning liability amongst the parties involved in the construction turnaround, including ISI.  On July 24, consistent with the jury’s findings, the District Court entered judgment for Marathon Petroleum for more than $70 million, which included prejudgment interest and attorney’s fees.  

The Shipley Snell trial team was Joel Z. Montgomery, Alex Rodriguez, George T. Shipley, and Jonathan B. Smith. Shipley Snell attorney Amy D. Maddux provided appellate support.