In Third Coast Servs., LLC v. Castaneda, the Texas Supreme Court ruled that statutory liability protection under the Texas Civil Practice & Remedies Code, Section 97.002, can apply even when a contractor does not have a direct contract with the Texas Department of Transportation (“TxDOT”). 726 S.W.3d 201 (Tex. 2025). Section 97.002 provides:

A contractor who constructs or repairs a highway, road, or street for the Texas Department of Transportation is not liable to a claimant for personal injury, property damage, or death arising from the performance of the construction or repair if, at the time of the personal injury, property damage, or death, the contractor is in compliance with contract documents material to the condition or defect that was the proximate cause of the personal injury, property damage, or death.

Tex. Civ. Prac. & Rem. Code § 97.002.

The TxDOT and Montgomery County (“County”) entered into a contract to develop the SH 249 corridor in Montgomery County, Texas. Id. at 205. Under this agreement, the County contracted with SpawGlass to serve as the general contractor to construct portions of the new SH 249, including various intersections along the SH 249 corridor. Id. SpawGlass’s subcontractor, Third Coast, installed all traffic signals at the intersections.  Id.

While the project was ongoing, Pedro Castaneda (“Castaneda”) attempted to cross an SH 249 road intersection but failed to yield at a stop sign, which resulted in him being struck by a truck. Id. at 204-205. At the time of the collision, Third Coast had installed, but not electrified, the traffic signals at the intersection.  Id.  As such, the traffic signals were covered with black construction fabric.  Id.  Castaneda died as a result of the collision, and his family filed suit against SpawGlass and Third Coast, among others.  Id.

The contractors moved for summary judgment based on § 97.002, arguing that, despite not contracting directly with TxDOT, as lower-tier subcontractors under a TxDOT contract umbrella, they were entitled to immunity. The Texas Supreme Court clarified and reversed the lower court’s decision that a contractual relationship was required for immunity. Id. at. 205. In its holding, the Court explained that the plain language of § 97.002 clearly extends to a contractor that “constructs or repairs a highway, road, or street for” TxDOT. Id. at 106. Meaning, the entity and its subcontractors that “contracts directly with TxDOT to construct or repair a state-owned highway, road, or street will, as a general rule, perform that work “for” TxDOT.” Id.

This decision expands protection and immunity to contractors under § 97.002 and permits them to assert the affirmative defense of immunity under this statute. The case is a significant win for roadway contractors in Texas, and contractors in other states should check to verify if similar protections exist in their respective states.