Clark et al v. W&M Kraft, Inc et al

Filing 327

OPINION AND ORDER granting 322 Defendant Consolidated Grain and Barge Company's Motion for Summary Judgment; denying 323 Defendant W&M Kraft Inc's Cross Motion for Summary Judgment and Response in Opposition 324 , such that it DISMISSES Kraft's cross-claim for indemnification. Signed by Judge S Arthur Spiegel on 6/25/2013. (km1)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
CHARLES CLARK, et al.,
Plaintiffs,
v.
W & M KRAFT, Inc., et al.,
Defendants.

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NO. 1:05-CV-00725

OPINION AND ORDER

This matter is before the Court on Defendant Consolidated
Grain and Barge Company’s Motion for Summary Judgment (doc. 322),
Defendant W&M Kraft, Inc.’s Cross Motion for Summary Judgment and
Response in Opposition (docs. 323, 324), and Consolidated Grain and
Barge Company’s Reply (docs. 325, 326).

For the reasons indicated

herein, the Court GRANTS Consolidated Grain and Barge Company’s
motion, and DISMISSES Kraft’s cross-claim for indemnification.
I.

Background
Defendants won a jury verdict in 2007 in the underlying

personal

injury

employee

of

case

Defendant

(“Consolidated”).

brought

by

Plaintiff

Consolidated

Grain

Charles
and

Clark,

Barge

an

Company

Defendant W&M Kraft, Inc. (“Kraft”), who held

a Consulting Agreement1 with Consolidated brought a cross-claim for

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Per the Agreement Kraft provided Consolidated with services
to assist Consolidated’s management personnel implement a
corporate safety culture to improve overall safety of the
company. Kraft had no interaction with Plaintiff and made no
assessment of the site where Plaintiff fell and was injured.

contractual indemnity against Consolidated, seeking attorneys’ fees
and costs incurred in defending against Plaintiffs’ claims.

Both

Defendants now claim that pursuant to the indemnity clause in their
contract each should prevail, while Defendant Consolidated goes
further and contends Kraft should be judicially estopped from
invoking the clause because Kraft successfully argued at trial that
its performance of the agreement had absolutely nothing to do with
Plaintiff’s

injuries.

The

parties

have

fully

briefed

their

positions and this matter is ripe for the Court’s review.
II.

Applicable Legal Standard
Although a grant of summary judgment is not a substitute

for trial, it is appropriate “if the pleadings, depositions,
answers to interrogatories, and admissions on file, together with
the affidavits, if any, show that there is no genuine issue as to
any material fact and that the moving party is entitled to a
judgment as a matter of law.”

Fed. R. Civ. P. 56; see also, e.g.,

Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464 (1962);
LaPointe v. United Autoworkers Local 600, 8 F.3d 376, 378 (6th Cir.
1993); Osborn v. Ashland County Bd. of Alcohol, Drug Addiction and
Mental Health Servs., 979 F.2d 1131, 1133 (6th Cir. 1992) (per
curiam).

In reviewing the instant motion, “this Court must

determine whether the evidence presents a sufficient disagreement
to require submission to a jury or whether it is so one-sided that
one party must prevail as a matter of law.”

2

Patton v. Bearden, 8

F.3d 343, 346 (6th Cir. 1993), quoting in part Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 251-252 (1986) (internal quotation marks
omitted).
The process of moving for and evaluating a motion for
summary judgment and the respective burdens it imposes upon the
movant and the non-movant are well settled.

First, “a party

seeking summary judgment ... bears the initial responsibility of
informing the district court of the basis for its motion, and
identifying those portions of [the record] which it believes
demonstrate the absence of a genuine issue of material fact [.]”
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); see also
LaPointe, 8 F.3d at 378; Guarino v. Brookfield Township Trustees,
980 F.2d 399, 405 (6th Cir. 1992); Street v. J.C. Bradford & Co.,
886 F.2d 1472, 1479 (6th Cir. 1989).

The movant may do so by

merely identifying that the non-moving party lacks evidence to
support an essential element of its case. See Barnhart v. Pickrel,
Schaeffer & Ebeling Co., L.P.A., 12 F.3d 1382, 1389 (6th Cir.
1993).
Faced

with

such

a

motion,

the

non-movant,

after

completion of sufficient discovery, must submit evidence in support
of any material element of a claim or defense at issue in the
motion on which it would bear the burden of proof at trial, even if
the moving party has not submitted evidence to negate the existence
of that material fact.

See Celotex, 477 U.S. at 317; Anderson v.

3

Liberty Lobby, Inc., 477 U.S. 242 (1986).

As the “requirement [of

the Rule] is that there be no genuine issue of material fact,” an
“alleged factual dispute between the parties” as to some ancillary
matter “will not defeat an otherwise properly supported motion for
summary judgment.” Anderson, 477 U.S. at 247-248 (emphasis added);
see generally Booker v. Brown & Williamson Tobacco Co., Inc., 879
F.2d

1304,

1310

(6th

Cir.

1989).

Furthermore,

“[t]he

mere

existence of a scintilla of evidence in support of the [nonmovant’s] position will be insufficient; there must be evidence on
which the jury could reasonably find for the [non-movant].”
Anderson, 477 U.S. at 252; see also Gregory v. Hunt, 24 F.3d 781,
784 (6th Cir. 1994).

Accordingly, the non-movant must present

“significant probative evidence” demonstrating that “there is [more
than] some metaphysical doubt as to the material facts” to survive
summary judgment and proceed to trial on the merits.

Moore v.

Philip Morris Cos., Inc., 8 F.3d 335, 339-340 (6th Cir. 1993); see
also Celotex, 477 U.S. at 324; Guarino, 980 F.2d at 405.
Although the non-movant need not cite specific page
numbers of the record in support of its claims or defenses, “the
designated portions of the record must be presented with enough
specificity that the district court can readily identify the facts
upon which the non-moving party relies.” Guarino, 980 F.2d at 405,
quoting Inter-Royal Corp. v. Sponseller, 889 F.2d 108, 111 (6th
Cir. 1989) (internal quotation marks omitted).

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In contrast, mere

conclusory allegations are patently insufficient to defeat a motion
for summary judgment.

See McDonald v. Union Camp Corp., 898 F.2d

1155, 1162 (6th Cir. 1990).
evidence,

facts,

and

The Court must view all submitted

reasonable

inferences

in

a

light

most

favorable to the non-moving party. See Matsushita Elec. Indus. Co.
v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Adickes v. S.H.
Kress & Co., 398 U.S. 144 (1970); United States v. Diebold, Inc.,
369 U.S. 654 (1962). Furthermore, the district court may not weigh
evidence or assess the credibility of witnesses in deciding the
motion.

See Adams v. Metiva, 31 F.3d 375, 378 (6th Cir. 1994).
Ultimately, the movant bears the burden of demonstrating

that no material facts are in dispute. See Matsushita, 475 U.S. at
587.

The fact that the non-moving party fails to respond to the

motion does not lessen the burden on either the moving party or the
Court to demonstrate that summary judgment is appropriate.

See

Guarino, 980 F.2d at 410; Carver v. Bunch, 946 F.2d 451, 454-455
(6th Cir. 1991).
III.

Discussion
When a contract is clear and unambiguous, then its

interpretation is a matter of law, and there is no issue of fact to
be determined.

Inland Refuse Transfer Co. v. Browning-Ferris

Indus. of Ohio, Inc., 15 Ohio St. 3d 321, 322, 474 N.E. 2d 271, 272
(Ohio, 1984).

The parties here both request the Court give the

contract its plain meaning and neither raise questions of ambiguity

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in the contract.

The Court finds the contract clear and concludes

this matter is appropriate for resolution by summary judgment. The
Court therefore can rule on the parties’ cross motions.
As an initial matter, the Court considers Consolidated’s
argument invoking judicial estoppel.

The doctrine enables the

courts to protect “the integrity of the judicial process,” by
preventing the “incongruity of allowing a party to assert a
position in one tribunal and the opposite in another tribunal.”
Edwards v. Aetna Life Insurance Co., 690 F.2d 595, 598-99 (6th Cir.
1982).

In assessing whether such doctrine applies, the Court

considers

whether

1)

a

party’s

later

position

is

clearly

inconsistent with its earlier position, 2) the party has succeeded
in persuading the court to accept that party’s earlier position,
and 3) the party advancing an inconsistent position would gain an
unfair advantage if allowed to proceed with the argument.

United

States v. Hammon, 277 Fed.Appx. 560, 566 (6th Cir. 2008)(citing In
re Commonwealth Institutional Sec., 394 F.3d 401, 406 (6th Cir.
2005).

Judicial estoppel must be “applied with caution to avoid

impinging on the truth-seeking function of the court because the
doctrine precludes a contradictory position without examining the
truth of either statement.”

Teledyne Indus., Inc. v. NLRB, 911

F.2d 1214, 1218 (6th Cir. 1990).
Consolidated argues Kraft should be judicially estopped
from invoking the indemnity clause because Kraft successfully

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argued

at

trial

that

the

contract

Plaintiff’s injuries (doc. 322).

had

nothing

to

do

with

Specifically, Consolidated notes

that in its cross-claim Kraft plead that the Consulting Agreement
“sets forth a limited scope of work to be performed by W&M Kraft
that does not encompass work that would form the basis for claims
asserted by the parties to this action against W&M Kraft,” and that
the

jury

ultimately

found

the

services

contemplated

in

the

Agreement did not apply to the facts surrounding Plaintiffs’ claims
(Id.).

In Consolidated’s view, after prevailing at trial, Kraft

did an about-face and began arguing the Consulting Agreement did
apply, and now seeks its attorney’s fees and costs as a consequence
of the lawsuit (Id.).
Kraft

responds

that

inapplicable here (doc. 323).

judicial

estoppel

simply

is

Kraft contends it has maintained an

action for indemnification from the outset of this matter, arguing
in its motion for judgment as a matter of law that even if it owed
a duty to Plaintiffs “there is no causal link between Kraft’s work
and Mr. Clark’s fall” (doc. 228). In Kraft’s view there is nothing
contradictory about arguing that its consulting activities did not
cause

Plaintiffs’

injuries

while

arguing

that

but

for

the

Consulting Agreement it never would have been named as a Defendant
(doc. 323).

As such, Kraft argues its request for indemnification

is not so clearly inconsistent with its prior arguments as to
provide a basis for judicial estoppel (Id.).

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The

Court

agrees

with

Kraft

and

finds

Consolidated

overreaches with its effort to invoke judicial estoppel. Kraft has
maintained an indemnity claim from the outset and there is no
blatant inconsistency. The Court does not see Kraft as engaging in
cynical gamesmanship or attempting to abuse the judicial process.
Teledyne, 911 F.2d 1214 at 1218.

Kraft is merely seeking its

attorney fees and costs through the indemnity provision of the very
contract that was the basis for Plaintiffs to sue it in the first
place.

It is entitled to make such an effort and the Court will

not bar its attempt.
The dispositive question is whether the actual terms of
the indemnity provision provide for the relief Kraft seeks.

The

indemnity provision is found in paragraph 4 of the Consulting
Agreement:
4. Indemnity. Each party will indemnify, defend, and
hold the other harmless from and against all claims,
liabilities, damages, losses, or expenses (including
settlements, judgments, court costs, attorneys’ fees, and
other litigation expenses), fines, or penalties to the
extent arising out of the negligence, wilful misconduct,
breach of contract, or violation of law by the party at
fault, its employees, agents, subcontractors, or
assignees in the performance of this Agreement. Further
in event that the parties are jointly at fault, they
agree to indemnify each other in proportion to their
relative fault. In no event shall the liability of either
party under this Agreement include indirect, incidental,
or consequential damages.
Consolidated argues that the indemnity provision provided that the
parties agreed to indemnify one another in the event that either

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breached the contract or were negligent “in the performance of
[the] agreement” (doc. 322).

Consolidated contends that because

it did not breach or commit negligence in performance of its
agreement, it cannot be held liable to Kraft for Kraft’s expenses
in defending against Plaintiffs, which are outside the scope of the
performance of the agreement.
dispute

that

it

performed

In Consolidated’s view, there is no
its

part

of

the

bargain:

it

paid

consideration to Kraft for Kraft’s consulting services, and it
committed no breach in doing so, nor was it negligent with regard
to the agreement.
Kraft responds that Consolidated’s interpretation of the
indemnification agreement is “impossibly narrow,” and that if the
only way Consolidated could be liable to Kraft would be by not
paying required consulting fees, there would be no need for the
indemnification provision in the first place (doc. 324).

In

Kraft’s view, Consolidated’s interpretation renders the provision
a nullity and runs afoul of the basic tenet of contract law that
contracts be interpreted to give meaning to each term (Id.). Kraft
argues it is a small business and requires a broad indemnification
provision to protect against exposure to liability for claims
brought against every client for whom it consults (Id.).
Having

reviewed

this

matter,

the

Court

finds

Consolidated’s position correct as to the interpretation of the
indemnification provision.

Kraft may indeed require a broad

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indemnification provision, but the provision in its contract simply
does not provide the protection it seeks.

The indemnity provision

does not include language requiring indemnity against all loss or
damage on account of any claim, demand, or suit made or brought
against

Kraft

Consolidated.
there

is

agreement.

a

by

or

on

behalf

of

any

employee

or

agent

of

Rather it limits indemnity to those instances where
breach

or

negligence

in

the

performance

of

the

Consolidated did not breach its contract and provided

Kraft with consideration for its services.

Consolidated did not

commit negligence in performing its part of the bargain.

An

indemnity agreement cannot be read to impose liability for those
losses or liabilities which are neither expressly within its terms,
nor of such a character that it can be reasonably inferred the
parties intended to include them within the indemnity coverage.
Corbitt v. Diamond M. Drilling Co., 654 F.2d 329, 333 (5th Cir.
1981).
The Court need not reach the question of whether Kraft’s
indemnity

claim

is

contractually

time-barred.

The

Court’s

conclusion that the claim is not within the scope of the indemnity
provision renders such question moot.
IV.

Conclusion
The Court concludes that although judicial estoppel is

not properly invoked in this matter, when it reaches the plain
unambiguous language of the indemnity clause at issue in the

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parties’ contract, Consolidated prevails.

The indemnity clause

drafted by Kraft on its face refers to breach or negligence
occurring in the performance of the agreement.
performed its part of the agreement.

Consolidated

Moreover, the jury found no

relation of Plaintiffs’ claims to the agreement.

Although the

Court is sympathetic to Kraft for having been pulled into this
litigation, Kraft prevailed against Plaintiffs. Under the American
Rule, it must cover its own attorneys’ fees and costs without an
indemnity agreement providing otherwise.

The indemnity agreement

in its agreement did not so provide.
Accordingly, the Court GRANTS Defendant Consolidated
Grain and Barge Company’s Motion for Summary Judgment (doc. 322),
and DENIES Defendant W&M Kraft, Inc.’s Cross Motion for Summary
Judgment and Response in Opposition (docs. 323, 324), such that it
DISMISSES Kraft’s cross-claim for indemnification.

SO ORDERED.

Dated: June 25, 2013

s/S. Arthur Spiegel
S. Arthur Spiegel
United States Senior District Judge

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