Siebe sued Gerson for refusing to defend it in product liability lawsuits over defective respirator masks. The court ruled that Gerson's duty to defend was triggered simply by the allegations in the lawsuits—not by proof that Gerson actually breached its warranty. The case was sent back to the lower court. For subcontractors, this means a broad indemnification clause can require you to defend your customer even before liability is proven.
A 'duty to defend' clause is triggered by what the lawsuit alleges, not by whether you actually caused the problem. You may have to pay for defense costs immediately.
Broad indemnification language in your supply or distribution agreements can obligate you to cover your customer's legal defense for product liability claims.