Cooper Industries, L.L.C. v. Precision Castparts Corp. et al

Filing 39

MEMORANDUM OPINION AND ORDER granting in part 27 Sealed Motion for Summary Judgment, denying 29 Sealed Motion for Summary Judgment (Joint Pretrial Order due by 10/7/2016. Docket Call set for 10/14/2016 at 03:00 PM in Courtroom 9B before Judge Sim Lake.) (Signed by Judge Sim Lake) Parties notified. (aboyd, 4)

United States District Court
Southern District of Texas

ENTERED

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
COOPER INDUSTRIES, LLC,

§
§
§
§
§
§
§
§
§
§

Plaintiff,
v.
PRECISION CASTPARTS CORP.
and WYMAN-GORDON COMPANY,
Defendants.

September 14, 2016
David J. Bradley, Clerk

CIVIL ACTION NO. H-15-0576

MEMORANDUM OPINION AND ORDER

Plaintiff

Cooper

Industries,

LLC

("Cooper")

action against defendants Precision Castparts Corp.

brought

this

("Precision")

and Wyman-Gordon Company ("Wyman") (together, "Defendants") seeking
a declaratory judgment that Defendants must indemnify Cooper for
and

defend

lawsuits

certain

pursuant

to

personal-injury
the

terms

of

asbestos
a

liabilities

stock purchase

and

agreement

between Cooper and Wyman and pursuant to the doctrine of collateral
estoppel. 1
Industries,
Motion")

Pending
LLC's

before

Motion

the

for

court

Summary

are

Plaintiff

Judgment

Cooper

("Plaintiff's

(Docket Entry No. 27) and Defendants' Motion for Summary

Judgment ("Defendants' Motion")

I.

(Docket Entry No. 29).

Background and Procedural History

This action arises out

of

asbestos personal-injury claims

stemming from the operations of Cameron Iron Works at its Katy Road

1

See Original Complaint
pp. 1-2 , , 1-3.

("Complaint") ,

Docket Entry No.

1,

facility.

2

Cooper acquired Cameron Iron Works in 1989. 3

From 1989

to 1994 Cameron Iron Works operated primarily in two business units
at the Katy Road facility:
and Forged Products. 4

the Oil Tools Division ("Oil Tools")

In January of

1994 Wyman purchased the

Forged Products business from Cooper pursuant to the Amended and
Restated Stock Purchase Agreement
action. 5

In January of

1995

(the

"SPA")

at

issue in this

Cooper transferred the Oil Tools

division to Cameron International Corporation ("Cameron") pursuant
to an Asset Transfer Agreement (the "ATA") . 6

2

See Deposition of Bruce E.
Himmelreich
Deposition"), Exhibit 3 to Plaintiff's Motion,
No. 28-3, p. 5 at 31:5-21.

( "Himmelreich
Docket Entry

3

See Plaintiff's Motion, Docket Entry No. 27, p. 7; Oral
Deposition, J. Ronald Sandberg ("Sandberg Deposition"), Exhibit 2
to Plaintiff's Motion, Docket Entry No. 28-2, p. 4 at 11:12-19.
See Complaint, Docket Entry No. 1, p. 3 ~ 10; Sandberg
Deposition, Exhibit 2 to Plaintiff's Motion, Docket Entry No. 28-2,
p.
4 at 11:12-19; Deposition of Wallace Whitney
("Whitney
Deposition"), Exhibit 16 to Defendants' Motion, Docket Entry
No. 30-16, p. 7 at 50:14-23.
4

See Complaint, Docket Entry No. 1, p. 1 ~ 11; Declaration of
Chad Seber in Support of Defendants' Motion for Summary Judgment
("Seber Declaration"), Docket Entry No. 30, p. 1 ~ 2; Whitney
Deposition, Exhibit 16 to Defendants' Motion, Docket Entry No. 3016, p. 7 at 50:14-23; Himmelreich Deposition, Exhibit 5 to
Defendants' Motion, Docket Entry No. 30-5, p. 6 at 31:4 top. 7 at
32:13.
The original SPA was effective January 10, 1994.
The
parties executed an Amended and Restated SPA effective May 26,
1994, but it contains no changes to the clauses relevant to this
dispute, and both parties attach and refer to the Amended and
Restated SPA as the SPA.
See Defendants' Motion, Docket Entry
No. 29, p. 9 n.1; Amended and Restated Stock Purchase Agreement,
Exhibit 1 to Defendants' Motion, Docket Entry No. 30-1. The SPA is
also attached as Exhibit 1 to Plaintiff's Motion, Docket Entry
No. 28-1, but citations will be to Docket Entry No. 30-1 for
consistency.
5

6

See Complaint, Docket Entry No. 1, p. 4 ~ 13; Plaintiff's
Motion, Docket Entry No. 27, p. 7; Defendants' Motion, Docket Entry
No. 29, p. 9.
-2-

Cameron Iron Works and Cooper were later named as defendants
in lawsuits alleging liability for asbestos exposure at Cameron
Iron Works' former Katy Road facility.

7

Following the SPA, Wyman

and Cooper allegedly agreed to split defense and indemnity costs
for such suits when it was not clear whether the plaintiffs in such
cases worked in Oil Tools or Forged Products. 8

If it could be

determined at which division the employee worked, Wyman (and later,
Precision)
Products

paid all of
employees

and

the claim and defense
Cooper

was

responsible

defense costs for Oil Tools employees.
in 2000.)

10

9

The

for

for

Forged

claims

and

(Precision acquired Wyman

After the closing of the ATA,

costs with Wyman. 11

costs

Cameron began sharing

cost-sharing practice

continued after

7

See Complaint, Docket Entry No. 1, pp. 3-4 ~~ 12-13;
Defendants' Motion, Docket Entry No. 29, p. 9; Plaintiff's Motion,
Docket Entry No. 27, p. 7.
8

See Whitney Deposition, Exhibit 4 to
Docket Entry No. 28-4, p. 7 at 68:8-69:11.

Plaintiff's

Motion,

9

See Himmelreich Deposition, Exhibit 3 to Plaintiff's Motion,
Docket Entry No. 28-3, p. 7 at 62:19-63:2. Wyman generally agrees
with these facts, asserting that "Cameron took responsibility for
defending and settling the asbestos cases arising out of Katy Road.
However, Wyman began an arrangement with Cameron by which Wyman
reimbursed costs associated with Katy Road asbestos claims to the
extent they involved Forged Products' operations
"
Defendants'
Motion,
Docket Entry No.
29,
p.
10;
see also
Himmelreich Deposition, Exhibit 5 to Defendants' Motion, Docket
Entry No. 30-5, p. 8 at 36:19 top. 9 at 37:9.
10

See Complaint, Docket Entry No. 1, p. 4 ~ 14; Defendants'
Motion, Docket Entry No. 2 9, p. 10; Plaintiff's Motion, Docket
Entry No. 27, p. 7.
11

See Himmelreich Deposition, Exhibit 3 to Plaintiff's Motion,
Docket Entry No. 28-3, p. 3 at 21:19-24:24.
-3-

Precision acquired Wyman, and between 1994 and 2006 Defendants paid
over $1.2 million on more than 100 claims. 12
The cost sharing continued until 2006, when Precision informed
Cameron that it would no longer contribute to defending and settling
asbestos claims. 13

That year a

case involving asbestos-exposure

injuries settled for $2.2 million (the "Sutterfield case") . 14

Emi

Donas, Precision's associate general counsel, attended the mediation
that led to the Sutterfield settlement,

and soon thereafter she

informed

pay

Cameron

that

Wyman

would

not

any

portion

of

the

Sutterfield settlement or future asbestos-injury claims. 15
On January 25, 2007, Cameron sued Wyman and Precision in Texas
state court asserting that Defendants' refusal to pay their portion
of the Sutterfield settlement constituted a breach of Defendants'
agreement to share costs with Cameron. 16

Precision and Wyman denied

12

See id. p. 4 at 25:3-26:4; 71:5-21.
See also Exhibit 5 to
Plaintiff's Motion, Docket Entry Nos. 28-5, 28-6, 28-7, 28-8
(correspondence, invoices, and checks regarding shared defense and
settlement costs between Cooper, Wyman, and Precision).
13

Defendants' Motion, Docket Entry No. 29, p. 10.
See also
Complaint, Docket Entry No. 1, p. 4 ~~ 14-15; Defendants' Answer to
Complaint ("Answer"), Docket Entry No. 8, ~~ 14-15.
14

See Himmelreich Deposition, Exhibit 3 to Plaintiff's Motion,
Docket Entry No. 28-3, p. 4 at 26:7-28:2, p. 6 at 34:9-25.
15

See Himmelreich Deposition, Exhibit 3 to Plaintiff's Motion,
Docket Entry No. 28-3, p. 4 at 26:7-28:2; Email from Himmelreich at
Cameron to Precision and Wyman detailing the concern at the breakdown of the payment arrangement after the Sutterfield settlement,
Exhibit 18 to Plaintiff's Response, Docket Entry No. 32-21.
16

See Plaintiff's Original Petition, Cause No. 2007-05527,
Exhibit 6 to Plaintiff's Motion, Docket Entry No. 28-9, p. 4
~~ 7-8; Defendants' Answer to Complaint ("Answer"), Docket Entry
No. 8, p. 3 ~ 15; Complaint, Docket Entry No. 1, p. 4 ~ 15.
-4-

liability

for

the

claims

and

argued

that

the

cost

arrangement did not override the SPA's express terms. 17

sharing
Wyman and

Cameron entered a Rule 11 agreement on January 22, 2009, agreeing
to stay the state court action in order to initiate arbitration
with Cooper. 18

Cameron and Wyman exchanged drafts of a

letter and the arbitration demand. 19

demand

Wyman sent a letter to Cooper

declaring a dispute under the SPA, and Cameron filed an arbitration
demand

against

Cooper. 20

Cameron

had

a

contractual

right

to

initiate arbitration with Cooper under the ATA, but Wyman did not
have the ability to compel Cooper to arbitrate. 21

Thus,

Wyman

17

Defendants' Motion, Docket Entry No. 29, p. 10; Answer,
Docket Entry No. 8, pp. 3-4 ~ 16; Complaint, Docket Entry No. 1,
p. 5 ~ 16.
Seber Declaration, Docket Entry No. 30, pp. 1-2 ~ 4; Rule 11
Agreement dated January 22, 2009, in Cause No. 2007-05527; Cooper
Cameron Corp. v. Wyman Gordon, and Precision ("Rule 11 Agreement") ,
Exhibit 2 to Defendants' Motion, Docket Entry No. 30-2; Exhibit 7
to Plaintiff's Motion, Docket Entry No. 28-10.
18

19

See Email from Emi Donis (Precision) re: ADR in Cooper/Wyman
agreement, Exhibit 8 to Plaintiff's Motion, Docket Entry No. 28-11;
Email from Susan Swanson (counsel for Cameron) re:
Cameron v.
Wyman Gordon/Precision Castparts, Exhibit 9 to Plaintiff's Motion,
Docket Entry No. 28-12.
20

See Confidential Settlement Negotiations dated June 3, 2009,
Re: Indemnity Dispute from Precision to Cooper, Exhibit 10 to
Plaintiff's Motion, Docket Entry No. 28-13; Demand for Arbitration,
Cameron International Claimant, Cooper Respondent, Exhibit 11 to
Plaintiff's Motion, Docket Entry No. 28-14.
21

Defendants' Motion, Docket Entry No. 29, pp. 10-11; see
generally Seber Declaration, Docket Entry No. 30, pp. 1-2 ~~ 4-6;
Rule 11 Agreement, Exhibit 2 to Defendants' Motion, Docket Entry
No. 30-2; Letter dated February 24, 2009, Re: Arbitration DemandCause No. 2007-05527; Cooper Cameron Corp. v. Wyman Gordon Company,
and Precision Castparts Corp.; In the 234th Judicial District Court
(continued ... )
-5-

asserts, the Rule 11 agreement was dependent upon Cooper's agreeing
to allow Wyman to participate in the arbitration. 22
Cameron requested in February and March of 2009 that Cooper
agree to include Wyman and Precision in a trilateral arbitration. 23
Cooper allegedly ignored Cameron's requests,
did not move forward.

24

and the arbitration

Cameron subsequently renewed its state-

court action against Precision and Wyman, but on March 15, 2010,
Cameron voluntarily dismissed the action. 25
the 2010 dismissal until March 25,

Wyman alleges that from

2015, Wyman and Precision did

not receive demands for contribution for asbestos liabilities from
Cameron or Cooper and had no involvement in or awareness of their
arbitration. 26

21

( • • • continued)
of Harris County, Texas, Exhibit 3 to Defendants' Motion, Docket
Entry No. 30-3; Letter dated March 5, 2009, Re: Arbitration Demand
Cause No. 2007-05527; Cooper Cameron Corp. v. Wyman Gordon
Company, and Precision Castparts Corp.; In the 234th Judicial
District Court of Harris County, Texas, Exhibit 4 to Defendants'
Motion, Docket Entry No. 30-4.
22

See note 21, supra.

23Id.

24

See Defendants' Motion, Docket Entry No.
29, p. 11;
Himmelreich Deposition, Exhibit 5 to Defendants' Motion, Docket
Entry No. 30-5, p. 10 at 74:7-23; Seber Declaration, Docket Entry
No. 30, p. 2 ~ 6.
25

See Seber Declaration, Docket Entry No. 3 0, p. 2 ~~ 7, 8 i
Plaintiff, Cooper Cameron Corporation's Motion for Non-Suit of
Wyman Gordon Company and Precision Castparts Corp., Exhibit 6 to
Defendants' Motion, Docket Entry No. 30-6.
26

See Defendants' Motion, Docket Entry No.
Declaration, Docket Entry No. 30, p. 2 ~ 9.
-6-

29,

p.

11; Seber

Arbitration proceeded between Cooper and Cameron.
asserts that

Cooper

"Cameron essentially adopted and litigated Wyman's

position that Wyman was not liable for Forged Products asbestos
claims." 27

The arbitration panel held that "[i]t is clear from the

SPA that Cooper transferred all
SPA.

uzs

liabilities

to

[Wyman]

in the

The arbitration panel granted summary judgment on some

claims, the parties settled the remaining claims, and a Texas state
court confirmed the arbitration award in January of 2015. 29
Following confirmation, Cooper determined that a pending claim
naming Cameron Iron Works as defendant allegedly involved a Forged
Products employee:
Cause

No.

Gatlin v.

2012-73370,

Harris

Cameron Iron Works U.S .A.,
County

Multidistrict

Inc.,

Litigation,

Texas, originally filed as Cause No. A193-233 (58th District Court,
Jefferson County,

Texas) . 30

On December 21,

2012,

Cooper first

27

See Plaintiff's Motion, Docket Entry No. 27, p. 8; Cameron's
Motion for Summary Judgment Concerning Cooper's Responsibility for
Liabilities Arising from Forged Products in Cameron v. Cooper
Industries, LLC, Exhibit 12 to Plaintiff's Motion, Docket Entry
No. 28-15, pp. 8-11.
28

See Panel's Decision on Motions for Summary Judgment,
Exhibit 13 to Plaintiff's Motion, Docket Entry No. 28-16, p. 3.
29

See

id.;

Settlement Agreement
in Cameron v.
Cooper
Exhibit 14 to Plaintiff's Motion, Docket Entry
No. 28-17; Judgment Confirming Arbitration Award Under Seal in
Cooper v. Cameron International Corporation,
Exhibit 15 to
Plaintiff's Motion, Docket Entry No. 28-18.

=I=n=d=u=s~t=r~l=·=e=s~,~L=L==C,

30

See Plaintiff's Motion, Docket Entry No. 27, p. 9.
The
Gatlin petition names Cameron and Cooper (among others) as
defendants but does not specify whether Gatlin worked in Forged
Products or Oil Tools.
See Defendants' Motion, Docket Entry
No. 29, p. 11; Gatlin Petition, Exhibit 7 to Defendants' Motion,
Docket Entry No. 30-7, pp. 10-22.
Discovery responses from that
(continued ... )
-7-

tendered the Gatlin complaint to Cameron,

claiming that Cameron

assumed that liability under the ATA and was "solely responsible"
for that claim, but Cameron rejected the tender. 31

Precision and

Wyman were allegedly unaware of the Gatlin action for over two
years, until on March 3, 2015, when Cooper tendered the action to
Precision and Wyman. 32

Cooper received no response from Defendants

to its original tender or its follow up letter. 33

30

continued)
action state that "from 1968 through 1981 [Gatlin] was an
inspector/laborer at Cameron Iron Works in Houston, TX."
See
Plaintiffs' Responses to Master Interrogatories, Requests for
Production and Requests for Disclosure ("Plaintiffs' Responses to
Master Interrogatories"), (MDL Cause No. 2012-73370, transferred
from Cause No. 33353, Gatlin v. Cameron Iron Works), Exhibit 8 to
Defendants' Motion, Docket Entry No. 30-8, p. 4, Answer 6.
( •••

31

See Defendants' Motion, Docket Entry No. 29, p. 12; Letter
from Cooper to Cameron dated December 21, 2012, Re: Gatlin v.
Cameron Iron Works, Exhibit 9 to Defendants' Motion, Docket Entry
No. 30-9, p. 1 ("Cooper believes this is a liability for which
Cameron is responsible under [the ATA] ."); Letter from Cameron to
Cooper dated January 16, 2013, Re: Gatlin v. Cameron Iron Works,
Exhibit 10 to Defendants' Motion, Docket Entry No. 30-10, p. 1
("Cameron believes that asbestos lawsuits arising from [Cameron
Iron Works] are 'Retained Liabilities' of Cooper under the ATA.").
32

See Defendants' Motion, Docket Entry No. 2 9, p. 12; Seber
Declaration, Docket Entry No. 30, p. 3 ~~ 14, 15; Letter to
Precision and Wyman dated March 3, 2015, Re: Gatlin v. Cameron Iron
Works, No. 2012-73370 ("Gatlin Tender to Cameron"), Exhibit 16 to
Plaintiff's Motion, Docket Entry No.
28-19,
Exhibit 11 to
Defendants' Motion, Docket Entry No. 30-11 (tendering Gatlin
complaint); Plaintiff's Original Petition in Cause No. A193-233,
Exhibit 16A to Plaintiff's Motion, Docket Entry No.
28-10
(Exhibit 7 to Defendants' Motion, Docket Entry No. 30-7, p. 10).
33

See Gatlin Tender to Cameron, Exhibit 16 to Plaintiff's
Motion, Docket Entry No. 28-19, Exhibit 11 to Defendants' Motion,
Docket Entry No. 30-11;
Plaintiff's Original Petition in Cause
(continued ... )
-8-

Cooper then brought this action, asserting two claims:
declaratory

judgment

interpreting

the

SPA

and

( 1)

confirming

a

that

Defendants assumed personal-injury asbestos liabilities related to
the Forged Products division and are required to indemnify and
defend

for

such

liabilities

pursuant

to

the

SPA;

and

( 2)

a

declaratory judgment that the arbitration panel's decision in the
Cooper-Cameron arbitration has collateral estoppel or res judicata
effect

in

this

action. 34

Following

the

completion

discovery, both parties moved for summary judgment.

of

fact

Cooper seeks

summary judgment that Wyman is liable for asbestos personal-injury
claims under the SPA as a

matter of

law,

and Defendants

seek

summary judgment in their favor on both of Cooper's claims. 35
II.

Standard of Review

Summary judgment is appropriate if the movant establishes that
there is no genuine dispute about any material fact and the movant
is entitled to judgment as a matter of law.

Fed. R. Civ. P. 56(a).

Disputes about material facts are genuine "if the evidence is such

continued)
No. A193-233, Exhibit 16A to Plaintiff's Motion, Docket Entry
No. 28-10 (Exhibit 7 to Defendants' Motion, Docket Entry No. 30-7,
p. 10); Letter to Precision and Wyman dated March 3, 2015, Re:
Gatlin v. Cameron Iron Works, No. 2012-73370, Exhibit 17 to
Plaintiff's Motion, Docket Entry No. 28-21 (following up on the
March 3, 2015, letter to which Cooper had not received a response);
see also Defendants' Motion, Docket Entry No. 29, p. 11.
33

34

( •••

See Complaint, Docket Entry No. 1, pp. 7-9

35

~~

See Plaintiff's Motion, Docket Entry No.
Defendants' Motion, Docket Entry No. 29, p. 7.
-9-

24-32.
27,

pp.

6-7;

that a reasonable jury could return a verdict for the nonmoving
party."

Anderson v.

Liberty Lobby,

Inc.,

106 S.

Ct.

2505,

2510

(1986).

The moving party is entitled to judgment as a matter of

law if "the nonmoving party has failed to make a sufficient showing
on an essential element of her case with respect to which she has
the burden of proof."

Celotex Corp. v. Catrett, 106 S. Ct. 2548,

2552 (1986).
A party moving for summary judgment "must

'demonstrate the

absence of a genuine issue of material fact,' but need not negate
the elements of the nonmovant' s case."
37 F.3d 1069, 1075 (5th Cir. 1994)

Little v. Liquid Air Corp. ,

(en bane)

(per curiam)

(quoting

"If the moving party fails to meet

Celotex, 106 S. Ct. at 2553).

this initial burden, the motion must be denied, regardless of the
nonmovant's response."
this burden,

"the

Id.

If, however,

nonmovant must

the moving party meets

go beyond the pleadings"

and

produce evidence that specific facts exist over which there is a
genuine
2553-54)

issue

for

trial.

Id.

(citing Celotex,

106

S.

Ct.

at

The nonmovant "must do more than simply show that there

is some metaphysical doubt as to the material facts."

Matsushita

Electric Industrial Co.,

106 S.

Ltd.

v.

Zenith Radio Corp.,

Ct.

1348, 1356 (1986).
"In

order

to

avoid

identify specific facts

summary

judgment,

the

within the record that demonstrate

existence of a genuine issue of material fact."
Mining Co., L.P.,

nonmovant

565 F. 3d 268,

273

-10-

must
the

CO,

Inc. v. TXU

(5th Cir. 2009).

"The party

must also articulate the precise manner in which the submitted or
Id.

identified evidence supports his or her claim."
quotation marks and citation omitted) .

(internal

"When evidence exists in

the summary judgment record but the nonmovant fails even to refer
to it in the response to the motion for summary judgment,
evidence is not properly before the district court."

Id.

that

(same).

In reviewing the evidence "the court must draw all reasonable
inferences in favor of the nonmoving party,
credibility determinations
Sanderson Plumbing Products,

or weigh

the

and it may not make
Reeves

evidence."

Inc., 120 S. Ct. 2097,

2110

v.

(2000).

The court resolves factual controversies in favor of the nonmovant,
"but only when there is an actual controversy, that is, when both
parties have submitted evidence of contradictory facts."

Little,

37 F.3d at 1075.

summary

judgment

is appropriate where

unambiguous.
n.3

In a contract interpretation dispute,
language of

the

contract

is

See Hanssen v. Qantas Airways Ltd., 904 F.2d 267, 269

(5th Cir. 1990)
III.

the

(citation omitted).

The Cross-Motions for Summary Judgment

Cooper's motion presents four issues:
(1) The indemnity clauses in§ 5.22(e) and§ 5.22(f) of
the SPA are unambiguous and require Wyman to indemnify
Cooper for asbestos personal-injury claims;
(2) Even if the SPA's indemnity clauses in§ 5.22(e) and
§ 5.22(f) are ambiguous, the parties' intent in drafting
and the parties' course of dealing establish as a matter
of law that liability for asbestos personal-injury claims
was transferred to Wyman;

-11-

(3) Collateral estoppel establishes Wyman's liability for
asbestos personal-injury claims; and
(4) Wyman is estopped from asserting any construction of
the SPA that requires Cooper to indemnify Wyman for
asbestos personal-injury claims. 36
Defendants

argue

that

summary

judgment

for

Defendants

is

appropriate on Cooper's first claim because the plain terms of the
SPA allocate asbestos liabilities arising from Forged Products'
operations at the Katy Road site to Cooper. 37

Defendants argue that

summary judgment for Defendants is appropriate on Cooper's second
claim because Defendants were neither parties to nor in privity
with either party in the arbitration between Cooper and Cameron,
and the issues here were not fully and fairly litigated in the
arbitration. 38

Defendants also argue that Precision is entitled to

summary judgment on both claims because it is not liable for any
obligations under the SPA as a non-party thereto. 39
A.

The Indemnity Clauses in SPA§ 5.22(e) and§ 5.22(£)

1.

Applicable Law

A federal court sitting in diversity applies the choice of law
rules of the forum state, and Texas law generally gives effect to
contractual choice-of-law clauses.
227 F.3d 308,

311

(5th Cir.

2000)

See Spence v. Glock, Ges.m.b.H.,
(citing Klaxon Co.

v.

Stentor

36

See Plaintiff's Motion, Docket Entry No. 27, pp. 6-7.

37

See Defendants' Motion, Docket Entry No. 29, p. 7.

38

See id.

39

See id.
-12-

Electric Manufacturing Co., 61 S. Ct. 1020, 1021-22 (1941)); Smith
v. EMC Corp., 393 F.3d 590, 597 (5th Cir. 2004); Exxon Mobil Corp.
v. Drennen, 452 S.W.3d 319, 324-31 (Tex. 2014).

The parties agree

that New York law therefore governs the relevant construction issues
pursuant to a choice of law clause in Section 8.9. 40
Under New York law, "where the language is clear, unequivocal
and unambiguous,
language."

the contract

a

contract

is

extrinsic evidence.

(quotation and citations omitted).

unambiguous,
See id.

834 N.Y.S.2d 142,

Ellington v.

EMI Music,

the

court

will

not

consider

The contract must be construed to

give full effect to all terms.
New York,

to be interpreted by its own

R/S Associates v. New York Job Development Authority,

771 N.E.2d 240, 242 (N.Y. 2002)
When

is

Acme Supply Co., Ltd. v. City of

143

Inc.,

(N.Y. App. Div.

21 N. E. 3d 1000,

2007); see also
1003

(N.Y.

2014)

("Where the terms of a contract are clear and unambiguous,

the

intent of the parties must be found within the four corners of the
contract,

giving

a

practical

interpretation

to

the

language

employed and reading the contract as a whole.")
An ambiguous term is one that is "capable of more than one
meaning when viewed objectively by a reasonably intelligent person
who has examined the context of the entire integrated agreement and
who is cognizant of the customs, practices, usages and terminology

40

See SPA§ 8.9, Exhibit 1 to Defendants' Motion, Docket Entry
No. 30-1, p. 117; Plaintiff's Motion, Docket Entry No. 27, p. 10;
Defendants' Motion, Docket Entry No. 29, p. 12.
-13-

as

generally understood

Millgard

Corp.

2952(LBS),

v.

2003

E.E.

WL

in

the

particular

trade

or

Cruz/Nab/Fronier-Kemper,

22741664,

at

*3

(S.D.N.Y.

business.

No.

Nov.

99
18,

11

Civ.
2003)

(citation omitted); see also Royal & Sun Alliance Insurance, PLC v.
E.C.M. Transport, Inc., No. 14 Civ. 3770(JFK), 2015 WL 5098119, at
*5 (S.D.N.Y. Aug. 31, 2015).
the

language

of

the

Summary judgment is appropriate where

contract

is

See

unambiguous.

Nowak

v.

Ironworkers Local 6 Pension Fund, 81 F. 3d 1182, 1192 (2d Cir. 1996);
Hanssen, 904 F.2d 267, 269 n.3 (5th Cir. 1990)
U.S.

Energy Systems,

Inc.

v.

(citation omitted);

Enviro Partners,

L.P.,

No.

97 CIV.

1748(JFK), 1999 WL 123806, at *6 (S.D.N.Y. March 8, 1999).
2.

The Language of the SPA

Both parties
Cooper

argues

application

of

argue

that

that

"[t] he

the

general

the

SPA language

language
rule

of

with

the
regard

liabilities of Forged Products because (1)

is

SPA
to

unambiguous.
confirms
the

the

asbestos

exclusions to Wyman's

liabilities found in§ 5.22(f) are inapplicable; and (2) asbestos
liabilities for employee exposures related to the manufacture of
products are 'Product Liability Claims' specifically identified as
Wyman liabilities in§ 5.22(e)

II

41

Defendants argue that

Cooper is responsible for liabilities that arise from an
alleged exposure at the Katy Road Site to asbestos
discharged into the internal workplace air because these
liabilities arise "by reason of or resulting from .
Regulated Materials disposed of on, or discharged into

41

Plaintiff's Motion, Docket Entry No. 27, p. 10.
-14-

the environment at, the Katy Road Site . . . on or before
the Closing Date .
" SPA§ 5.22(f). Because these
liabilities are addressed by Section 5.22(f), they are
expressly excluded from Wyman's allocated liabilities in
Section 5.22(e), which does not apply to "the Losses that
the Seller is required to indemnify pursuant to .
Section 5.22(f)
"
SPA§ 5.22(e).
The parties
therefore agreed that liabilities arising from a
discharge of Regulated Materials at the Katy Road site including asbestos -would be Cooper's responsibility,
not Wyman' s . 42
SPA § 5.22 contains the parties' respective indemnification
obligations.

Section

5. 22 (e),

"Additional

Indemnification

by

[Wyman] , 43 " defines Wyman's indemnification obligations in relevant
part as follows:
Subject to the terms and conditions of this Section 5.22
and in addition to the indemnification provided for in
Section 5. 22 (b) , [Wyman] agrees, other than the Losses
that [Cooper] is required to indemnify pursuant to
Section 5. 22 (b) 44 or Section 5. 22 (f)
. to indemnify
and hold [Cooper] harmless from and against all Losses
which [Cooper] may suffer, sustain or become subject to
by reason of or resulting from any liabilities or
obligations of or relating to, or claims against, any
Cameron Entity45 or the Business 46 on, before or after the

42

Defendants' Motion, Docket Entry No. 29, p. 14.

43

"Buyer" and "Buyer's Group" have been replaced with "Wyman"
for ease of discussion.
"Seller" and "Seller's Group" have been
replaced with "Cooper."
44

Section 5. 22 (b) refers to indemnification for breaches of the
warranties, representations, and covenants of the SPA and is not
relevant to this dispute.
See SPA § 5. 22 (b), Exhibit 10 to
Defendants' Motion, Docket Entry No. 30-1, p. 100.
45

"Cameron Entities" is defined to include "that portion of
each of the following companies to the extent that it presently
conducts or previously conducted all or part of the Business:
(ii) the forged products division of Cameron Iron Works,
Inc., (iii) the forged products division of Cameron Iron Works USA,
(continued ... )
-15-

Closing Date,
including without limitation
(I)
to
indemnify and hold [Cooper] harmless from and against all
Losses which the [Cooper] may suffer, sustain or become
subject to by reason of or resulting from any Product
Liability Claims arising out of or resulting from
Products sold or furnished by [Cooper] , any of its
Affiliates or any Cameron Entity (including without
limitation any product liability assumed in connection
with the acquisition of any business or product line) on,
before or after the Closing Date; (ii) to indemnify and
hold [Cooper] harmless from and against all Losses which
[Cooper] may suffer, sustain or become subject to by
reason of or resulting from (A) any noncompliance of the
operations, properties or business activities of any
Cameron Entity or the Business with any Environmental Law
on, before or after the Closing Date or (B) any
liabilities or obligations of or relating to, or claims
against, any Cameron Entity or the Business based upon
any Environmental Law, or arising from the disposal of
any Regulated Materials, on, before, or after the Closing
Date .
Section 5. 22 (f) describes "Additional Indemnification by [Cooper] ·"
Subject to the terms and provisions of this Section 5.22
and in addition to the indemnification provided for in
Section 5.22(b), [Cooper] agrees, other than the Losses
that [Wyman] is required to indemnify pursuant to Section
5.22(b)
(I) to indemnify and hold [Wyman] harmless
from and against all Losses which the [Wyman] may suffer,
sustain or become subject to by reason of or resulting
from any liabilities or obligations of or relating to, or
claims against, [Cooper] or [Cooper's] Subsidiaries 47 on,

45

( •••

Inc.,
Limited."

continued)
(v) the forged products division of Cameron Iron Works
See id. § 5.22(h) (iv), p. 106.

46

"Business" is defined as "research, development, engineering,
melting,
refining,
remelting,
forging,
extrusion, machining,
manufacturing, distribution, sales, marketing, service or repair
operations associated with the Products."
Id. § 5. 22 (h) ( ii) ,
p. 106.
47

"[Cooper] Subsidiaries" are defined as "the subsidiaries of
the Seller other than the Company and the Company Subsidiaries."
See id. § 3.4, p. 24.
The "Company" is defined to mean "Cameron
Forged Products Company." See id. at p. 6.
-16-

before or after the Closing Date to the extent that such
liabilities, obligations or claims (x) do not relate to
the Business and (y) arise from the activity of (a) any
Cameron Entity (other than the Company or the Pipeline
Sub) before the Closing Date, or (b) [Cooper] or any of
[Cooper's]
subsidiaries
(other
than
the
Cameron
Entities) , ( ii) except to the extent the actions of
[Wyman] , the Company or their Affiliates may cause or
increase any such Losses after the Closing Date, to
indemnify and hold [Wyman] harmless from and against all
Losses which [Wyman] may suffer, sustain or become
subject to by reason of or resulting from any Regulated
Materials disposed of on,
or discharged into the
environment at, the Katy Road Site or the Gulf Metals
Site on or before the Closing Date .
Cooper argues that under§ 5.22(e) Wyman agreed to retain all
environmental liabilities related to the Forged Products business
unless those liabilities were specifically carved out in§ 5.22(f),
which

does

5. 22 (f) (ii)

not

carve

out

asbestos

liabilities. 48

Subsection

does carve out liabilities resulting from "Regulated

Materials" "disposed of on, or discharged into the environment at,
the

Katy

includes

Road

Site. " 49

workplace

Wyman

exposures

argues
to

that

asbestos,

this
so

unambiguously
that

"these

liabilities are expressly excluded from the liabilities allocated
to Wyman under Section 5. 22 (e)" and "Defendants are accordingly not
liable for these liabilities under Section 5.22(e)

or any other

portion of the SPA. " 50

48

See Plaintiff's Motion, Docket Entry No. 27, p. 11.

49

Id. at 12.

50

Defendants' Motion, Docket Entry No. 29, pp. 14, 20-21;
Defendant Wyman-Gordon Company's Response to Cooper Industries'
Motion for Summary Judgment ("Defendants' Response"), Docket Entry
(continued ... )
-17-

The parties' arguments thus turn on the meaning of "disposed
of on," "discharged into," and the "environment."
define these terms.

The SPA does not

Cooper argues that the plain-language meaning

of "disposed of" and "discharged into" are active verbs requiring
an intentional and affirmative act,

not an incidental release. 51

Cooper also argues that these are terms of art in the environmental
context

and

contamination. 52

specifically

refer

to

soil

and

groundwater

Defendants respond that under applicable law and

other clauses of the SPA, as a matter of law, toxic tort asbestos
claims arise from a discharge into the environment. 53

50

( • • • continued)
No. 34, p. 9.
Defendants rely only on the "discharged into the
environment" language because the underlying Gatlin asbestos claim
involved a discharge of asbestos dust into the air.
See
Defendants' Response, Docket Entry No. 34, p. 9 n.3 (citing
Plaintiffs' Responses to Master Interrogatories, Exhibit 8 to
Defendants' Motion, Docket Entry No. 30-8, p. 4 (discussing
Mr. Gatlin's occupational exposure to asbestos)).

51

Plaintiff's Motion, Docket Entry No. 27, p. 12.

52

See id. Wyman argues that asbestos is a "Regulated Material"
and notes that Cooper does not dispute that point in its motion.
See Defendants' Motion, Docket Entry No. 29, p. 15; Defendants'
Response, Docket Entry No. 34, p. 9 (citing Jones v. Cain, 600 F.3d
527, 541 (5th Cir. 2010)
("Arguments raised for the first time in
a reply brief are generally waived.").
Therefore, Wyman argues,
Cooper has conceded the same.
Cooper's motion does not address
whether asbestos is a regulated material.
Cooper's Response
indicates that whether asbestos is a Regulated Material under the
SPA is largely irrelevant to interpreting the asbestos personalinjury claims at issue in the Complaint, but that the SPA allocates
asbestos personal injury liability to Wyman, even if asbestos is a
"Regulated Material."
See Plaintiff Cooper Industries, LLC' s
Response in Opposition to Defendants' Motion for Summary Judgment
("Plaintiff's Response"), Docket Entry No. 31, p. 7.
53

See Defendants' Response, Docket Entry No. 34,
Defendants' Motion, Docket Entry No. 29, pp. 16-20.
-18-

pp.

9-10;

i.

Defendants' Motion

Defendants argue

that

§ 5. 22 (f)

clearly includes asbestos

discharged into internal workplace air and such liabilities are
thus excluded from§ 5.22(e) . 54

Defendants argue that "discharge

into the environment" applies to internal workplace exposure to
asbestos under applicable case law. 55

Cooper responds that under

controlling New York law "discharge" and "disposal" are terms of
art that do not include asbestos in workplace air and that the
plain language of environmental regulations and the SPA distinguish
between "workplace" and "environment." 56

Cooper also argues that

the environmental disclosures in the SPA indicate that the parties'
concerns with the Katy Road and Gulf Metals sites were limited to
soil and groundwater contamination and Superfund liability. 57
Defendants rely on Tragarz v. Keene Corp., 980 F.2d 411, 413,
425

(7th Cir. 1992), where the court had to decide "whether the

release of large amounts of asbestos into the internal, workplace
environment exclude[d] th[e] case from a comparative fault analysis
under Ill. Rev.

Stat.,

negligence

claims

insulation

products

ch.

against
after

110,

~

2-1118."

multiple
he

Mr. Tragarz alleged

manufacturers

of

asbestos

developed mesothelioma.

54

See Defendants' Motion, Docket Entry No. 29, p. 14.

55

See id. at 16.

56

See Plaintiff's Response, Docket Entry No. 31, p. 7.

57

See id.
-19-

Id.

at

413-14.

Mr. Tragarz worked in construction alongside insulators

and pipefitters who installed and cut products containing asbestos,
generating asbestos dust.

Id. at 414-15.

A jury awarded a verdict

for Tragarz, and defendants appealed, arguing that they should have
been allowed to offer evidence of Tragarz' s

exposure

to other

products for purposes of showing comparative fault under Illinois'
joint-and-several

section imposing

joint and several

scheme,

liability.

See id. at 417, 425.

Tragarz

which

pure

statutory

argued that

eliminated

a

liability as an exception to comparative fault applied.
426.

Id.

at

The statutory exception imposed joint and several liability

on defendants found liable "in any action in which the trier of
fact determines that the injury or damage for which recovery is
sought was
environment

caused by an act
of

any

involving

pollutant,

the

including

discharge

any

waste,

into

the

hazardous

substance, irritant or contaminant, including, but not limited to,
. asbestos .
ch.

~

110,

It

Id. at 425-26

(quoting Ill. Rev. Stat.,

The defendants argued that the joint and

2-1118)

several liability statute did not apply because "discharge into the
environment means discharge into the external environment and not
discharge

into

workplace."
The

environment

internal

to

a

building

or

Id. at 426.

court

defendants

the

found

argued

no

that

Illinois
cases

precedent

interpreting

CERCLA supported their position.
-20-

See

id.

on point,
similar
at

427.

but

language

the
in

The court

recognized that Illinois' joint and several liability statute and
CERCLA were "two very different statutes;" CERCLA "focuses on the
national concern of public health and environment while Illinois's
. statute focuses on individual, personal injury and property
claims."

Id.

at 427,

428.

The court reasoned that with that

change in focus could come a change in the meaning of the term
"environment."

Id. 58

Finding "discharge into the environment" not

surrounded by equally broad terms, and with no rule of construction
like in the insurance context, the court held that the statutory
exception applied.

Id.

The court also undertook an analysis to

determine whether its interpretation comported with legislative
intent, comparing the statute to similar language in the Illinois
Environmental Protection Act and the statute's legislative history.
Id. at 429.

The Seventh Circuit concluded that the district court

had appropriately excluded evidence of Tragarz's exposure to other
manufacturer's products, holding:
Because a comparison of the joint and several liability
provision and IEPA indicates that discharge into the
environment under the joint and several liability statute
includes large discharges of asbestos into an internal

58

The court also distinguished defendants' second line of cases
involving "pollution exclusions" in insurance contracts.
See
Tragarz, 980 F.2d at 428 (discussing United States Fidelity &
Guaranty Co. v. Wilkin Insulation Co., 578 N.E.2d 926 (Ill. 1991)).
In one such case, Wilkin Insulation, the policy excluded coverage
for the discharge of "irritants, contaminants or pollutants into or
upon the land, the atmosphere or any water course or body of
water."
Id.
The Tragarz court noted that the Wilkin Insulation
court relied on the use of the word "atmosphere" and the terms
"into or upon land" and "any course or body of water," which
suggest the external atmosphere.
Id.
-21-

workplace environment, and because such an interpretation
is consistent with, and in fact promotes, the legislative
purpose reflected in the legislative history, we agree
[that § 2-1118 applies] .
Id. at 430.
In addition to this authority, Defendants argue that they are
entitled to prevail under the plain language of the SPA and that
"the

indemnification

references to
water'

clause

'land,'

in

the

'atmosphere,'

SPA

does

not

contain

'water course,'

the

or 'body of

that have previously been cited as evidence in pollution

exclusion insurance cases that the clause applies exclusively to
the

external

Defendants

environment." 59

argue

Materials .

that

See

"construing

Tragarz,
the

980

clause

F.2d
'any

at

428.

Regulated

. discharged into the environment' narrowly to refer

exclusively to the external environment would contradict the broad
definition

of

'Regulated

Materials'

set

"Regulated Material" means any material,

forth

in

substance,

the

SPA." 60

radiation or

emission that is regulated by or subject to any Environmental Law. 61
"Environmental Laws" include CERCLA, the Solid Waste Disposal Act,
the

Clean Air Act,

the

Clean Water Act,

the

Toxic

Substances

Control Act, and the Occupational Safety and Health Act. 62

59

See Defendants' Motion, Docket
(citing Tragarz, 980 F.2d at 428).
60

Entry

No.

29,

pp.

18-20

See id. at 18.

61

SPA § 3.15(c), Exhibit 1 to Defendants' Motion, Docket Entry
No. 30-1, p. 35.
62

See id.

§

3.15(b) p. 35.
-22-

Defendants note that "[l]ong prior to the SPA, OSHA regulated
asbestos,

had

as

its

principal

focus

environment, and used 'environment'
'air')

the

internal

(as well as

workplace

'atmosphere' and

to refer to internal workplace environments, not external

environments." 63

For example, one 1986 OSHA regulation provides:

[T]wo environments may be affected by an OSHA regulatory
action: (1) The workplace environment and (2) the general
human environment external to the workplace, including
impacts on air and water pollution, solid waste, and
energy, and land use
These regulations are
beneficial to the workplace environment because they
reduce worker exposure to toxic and carcinogenic
substances. An in-depth discussion and analysis of the
occupational nature of asbestos disease, the workplace
environment, and the benefits to workers as a result of
this rule are presented in earlier sections of this
Notice. 64
Defendants

point

to

other portions

of

the

SPA that

they

contend confirm that Cooper interpreted "Regulated Materials" and
"environmental"

issues

workplace environment. 65
Compliance,"

Cooper

to
In

include
§

warranted

asbestos

3. 15 of
that

in

the SPA,

"[e] xcept

as

Section 3.15 of the Seller Disclosure Schedule,"

the

internal

"Environmental
set

forth

on

its operations

were in compliance with "all Environmental Laws" and Cooper was not

63

See Defendants' Motion, Docket Entry No. 29, p. 18; Sample
Usages of
"Environment,"
"Atmosphere,"
and
"Air"
in OSHA
Regulations addressing Internal Workplace Exposure to Asbestos
Before 1994 ("Sample OSHA Regulations"), Exhibit 14 to Defendants'
Motion, Docket Entry No. 30-14.
64

Sample OSHA Regulations, Exhibit 14 to Defendants' Motion,
Docket Entry No. 30-14, p. 1 (citing 51 FR 22612 at 22671)
65

See Defendants' Motion, Docket Entry No. 29, p. 19.
-23-

"subject to any claim, notice of investigation or liability based
upon any Environmental Law or arising from the disposal of any
Regulated Material .

"66

Cooper's

§

3.15 Disclosure Schedule

lists "[a]sbestos containing material at the site in the form of
floor tile and mastic" for a Cypress, Texas facility.

67

Defendants

argue that "Cooper accordingly acknowledged that the existence of
asbestos on floor tiles and mastic in internal workplace facilities
constituted

an

environmental

issue

that

could

give

rise

liability based upon an Environmental Law or arising from
disposal of a Regulated Material." 68

to
the

However, that disclosure was

an "additional item noted by the Buyer" on the disclosure sheet and
no similar additional items are included for the Katy Road site or
Gulf Metals site, which describe groundwater and soil contamination
and state Superfund liability. 69
Many of Cooper's responsive arguments are duplicative of those
in its motion and are addressed below.

The same is true of many of

Defendants' responsive arguments, which have been set forth in this
section.

The

court

will

next

address

Cooper's

arguments

and

authorities.

66

See SPA § 3.15(a), Exhibit 1 to Defendants' Motion, Docket
Entry No. 29, p. 35.
67

See Disclosure Schedule Section 3.15,
Exhibit
Defendants' Motion, Docket Entry No. 30-15, p. 2.
68

15

to

15

to

See Defendants' Motion, Docket Entry No. 29, p. 19.

69

See Disclosure Schedule Section 3. 15,
Exhibit
Defendants' Motion, Docket Entry No. 30-15, p. 2.
-24-

ii.

Plaintiff's Motion

Cooper cites Uribe v. Merchants Bank of New York, 693 N.E.2d
740, 742 (N.Y. 1998), for the proposition that although words in a
contract should generally be interpreted by their ordinary meaning,
a

word or phrase that

is a

term of art

according to its technical meaning. 70

should be

interpreted

In Uribe the court rejected

a party's argument that "valuable papers" was an ambiguous term
that could be read to include currency or cash.

Id. at 338.

court noted that in "usual parlance and understanding,

The

the term

'valuable papers' is customarily limited to various kinds of legal
or business documents."
also

found

that

Id. at 742 (citations omitted) .

traditional

rules

of

contract

supported its conclusion, and was "not persuaded .
money and stacked bills,

The court

construction
. that paper

because not expressly excluded, may be

treated as included within the term of art-"valuable papers."
at 743

(citations omitted) .

'valuable papers'

Id.

The court concluded that "the term

should not be enlarged and transformed by the

courts to allow the deposit of cash, a specific authorization the
box

rental

agreement

failed

to

specify.

The

definition

this

commercial dealer now proposes rests on an impermissibly 'strain[ed
reading] to find an ambiguity which otherwise might not be thought
to exist."'

Employers'

Liability

Assurance Corp., Ltd., 442 N.E.2d 438, 441 (N.Y. 1982)).

Thus, the

70

Id.

(quoting Loblaw,

Inc.

v.

See Plaintiff's Motion, Docket Entry No. 27, p. 12.
-25-

use of a term of art and its technical meaning did not render the
agreement ambiguous.

See id.; see also Madison Avenue Leasehold,

LLC v. Madison Bentley Associates, LLC, 811 N.Y.S.2d 47, 52 (N.Y.
App. Div. 2006), aff'd, 861 N.E.2d 69 (N.Y. 2006).
"While words are generally assigned their ordinary meaning,
where a word has attained the status of a term of art and is used
in

a

technical

technical

context

meaning

meaning."

is

(here,

preferred

["default"
over

the

in]

a

common

lease),
or

the

ordinary

Generally, "[p]arties who engage in transactions based

on prevailing law must be able to rely on the stability of such
precedents."

Madison Avenue Leasehold, 811 N.Y.S.2d at 52.

"[I] t

is axiomatic that the parties to an agreement will interpret the
instrument governing their relationship in accordance with existing
law."

Id. at 53.
Cooper argues that "disposed of on" and "discharged into" are

terms of art as used in§ 5.22(f) . 71

"Disposal" is defined in the

Comprehensive Environmental Response, Compensation, and Liability
Act of 1980

("CERCLA")

at 42 U.S.C.

§ 9601(29)

(referencing the

definition in the Solid Waste Disposal Act, 42 U.S.C. § 6903(3)),
and the definition uses "discharge":
The term "disposal" means the discharge,
deposit,
injection, dumping, spilling, leaking, or placing of any
solid waste or hazardous waste into or on any land or
water so that such solid waste or hazardous waste or any
constituent thereof may enter the environment or be

71

See Plaintiff's Motion, Docket Entry No. 27, p. 13.
-26-

emitted into the air or discharged into
including ground waters.
42 U.S.C.

§

6903 (3)

(emphasis added).

any waters,

72

The New York Supreme Court has recognized that "discharge" and
"dispersal"

are

"terms

of

art

in

environmental

law used with

reference to damage or injury caused by disposal or containment of
hazardous waste."

See Belt Painting Corp. v. TIG Insurance Co.,

795 N.E.2d 15, 20 (N.Y. 2003)
Rapid-American Corp.,

(quoting Continental Casualty Co. v.

609 N.E.2d 506,

509

(N.Y. 1993)).

In Belt

Painting Corp., 795 N.E.2d at 16, the court addressed the applicability of a pollution exclusion endorsement in an insurance policy
that excluded coverage for:

"'Bodily injury' or 'property damage'

which would not have occurred in whole or part but for the actual,
alleged or threatened discharge,

dispersal,

release or escape of pollutants at any time."
plaintiff,

Belt Painting,

seepage,

migration,

An employee sued the

alleging injury due to inhaling paint

fumes in an office where he performed painting and stripping work.
Id.

Belt Painting's insurer refused to defend or indemnify the

suit, relying on the exclusion.

Id. at 17.

The court examined the history of environmental exclusions in
insurance policies. 73

See id. at 17-20.

The fact that "discharge"

72

Cooper also argues that "[t]his specialized meaning comports
with the understanding of Cooper's counsel who was responsible for
the language of the indemnity provisions at the time of drafting."
Plaintiff's Motion, Docket Entry No. 27, p. 13 (cross-referencing
Plaintiff's Motion Section II.A).
73

In the unique context of insurance policies, "[t] o 'negate
coverage by virtue of an exclusion, an insurer must establish that
(continued ... )
-27-

and "disposal" are "terms of art in environmental law," "support [ed
the]

conclusion

[the

that

exclusion]

does

not

clearly

and

unequivocally exclude a personal injury claim arising from indoor
exposure to plaintiff insured's tools of its trade."

Id. at 20.

The court held that "[a]s one court noted in a similar factual
setting, 'it strains the plain meaning, and obvious intent, of the
language
container

to
to

"discharged,

suggest

that

[the

injured

dispersed,

these

fumes,

party's]

released or

as

lungs,

they

went

had

from

somehow
Id.

escaped."'"

the
been

(quoting

Meridian Mutual Insurance Co. v. Kellman, 197 F.3d 1178, 1184 (6th
Cir.

1999)).

The Supreme Court affirmed the appellate court's

grant of summary judgment to Belt Painting because the insurer did
not show that the language in its exclusion unambiguously applied
to the underlying personal injury claim.

Id. at 16.

Courts have also rejected the proposition that emission of
asbestos into the internal workplace air is a disposal into the
"environment"

in the CERCLA environmental context.

Sycamore Industrial Park Associates v.
847,

853

(7th Cir.

2008)

Ericsson,

(reaffirming that

73

See,

Inc.,

e.g.,

546 F.3d

"when there

is no

( • • • continued)
the exclusion is stated in clear and unmistakable language, is
subject to no other reasonable interpretation, and applies in the
particular case.'"
Belt Painting Corp.,
795 N.E.2d at 17
(citations omitted) . "It follows that policy exclusions are given
a strict and narrow construction, with any ambiguity resolved
against the insurer." Id. The court held in favor of the insured
based on its finding that the policy was ambiguous,
but
acknowledged the environmental terms of art.
Id. at 20-21.

-28-

emission

into

the

outside

environment,

but

rather

any

hazard

resulting from emission of asbestos fibers would be confined inside
a building,

there is no release or threatened release,

and thus

there can be no liability under CERCLA" and citing cases holding
that

"the release of asbestos

of

CERCLA") .

building,

employment

is

not

the

A New York court has

environment

for

2002)

includes

("Thus,
the

notwithstanding

'ambient

purposes

found similarly.

Ruffing v. Union Carbide Corp., 746 N.Y.S.2d 798,
Ct.

with no leak

. is not governed by CERCLA" and "the interior of a

outside,
place

inside a

that

the

See,

809

term

of

e. g.,

(N.Y. Sup.

'environment'

air within the United States',

numerous

courts considering [CERCLA] have determined that 'the "environment"
referred to in the statute "includes the atmosphere, external to
the building,"'
omitted)),

but not the air within a building."

aff'd,

766

N.Y.S.2d

439

(N.Y.

App.

Defendants argue that this is not a CERCLA case,
hazardous

materials,

distinguishable,

that

insurance

(citations

Div.

2003).

not limited to

exclusion

cases

are

and that Cooper's reading of the clause is too

narrow. 74
iii.

The SPA Unambiguously Assigns Asbestos Workplace
Injury Liabilities to Wyman

Having carefully considered the parties' arguments, the court
concludes that

74

§

5.22(f)

unambiguously applies only to external

See Defendants' Response, Docket Entry No. 34, pp. 11-12.
-29-

environmental

discharges

or

disposals

and

that

Wyman

assumed

liability for asbestos-related personal injury claims by employees.
All terms used in a contract must be given meaning.

Lawyers' Fund

for Client Protection of the State of New York v. Bank Leumi Trust
Co.
§

of

New York,

5. 22 (e),

727

N.E.2d

563,

Wyman broadly agreed

566-67

to

(N.Y.

indemnify

2000)

Cooper

Under
for

"any

noncompliance of the operations, properties or business activities
with any Environmental Law"
obligations

and for

"any liabilities or

. . based upon any Environmental Law, or arising from

the disposal of any Regulated Materials." 75

In

§

5.22(f)

retained the obligation to indemnify Wyman only for

Cooper

"Regulated

Materials disposed of on, or discharged into the environment" at
the Gulf Metals and Katy Road sites. 76
not Cooper,
upon
§

any

is responsible for liabilities and obligations based

Environmental

5. 22 (f)

Law,

and

the

more

specific

clause

in

carves out limited liabilities for which Cooper will

indemnify Wyman.
26

Under this language, Wyman,

(Bankr.

See In re Arcapita Bank B.S.C. (c), 520 B.R. 15,

S.D.N.Y.

2014)

(discussing

the

rule

of

contract

construction that the more specific clause controls the general
clause) .
the

The court cannot read "disposed of on, or discharged into

environment"

out

of

§

5. 22 (f) ;

75

these

terms

must

be

See SPA §
5.22(e)(ii)(A),
(e)(ii)(B),
Exhibit
Defendants' Motion, Docket Entry No. 30-1, p. 102.
76

See id.

§

5.22(f)(ii), p. 104.
-30-

given

1

to

See Lawyers'

meaning, and the contract must be read as a whole.
Fund for Client Protection, 727 N.E.2d at 566-67.
Turning
workplace:

to

whether
the

elsewhere,

"workplace,"
synonymously.

"environment"

indicating

SPA

that

lists
the

includes
both

parties

"Environmental Laws"

the

internal

"environment"
did

not

use

and
them

"means all Laws concerning,

. the introduction of any material,

relating to or controlling .
substance

or other emission into the environment or workplace

"77

The carve-out in§ 5.22(f) is only for discharges into

the environment.
synonymously

These are separate terms and cannot be read

because

the

parties

used

them

both.

Enterprises LLC v. Comcast Cable Communications, LLC, 851 N.Y.S.2d
551, 557 (N.Y. App. Div. 2008)

("The use of different terms in the

same agreement strongly implies that the terms are to be accorded
different meanings.") .

Also, § 5. 22 (f) does not use the broad term

"Environmental Laws."

That term only appears in§ 5.22(e) in the

discussion of Wyman's duty to indemnify.
The case Defendants rely on, Tragarz, is distinguishable and
based on non-binding Illinois law.

77

The court addressed a matter of

SPA § 3.15(b), Exhibit 1 to Defendants' Motion, Docket Entry
No. 30-1, p. 35 (emphasis added). Defendants argue that although
some OSHA regulations use the phrase "environment or workplace,"
others refer to the "workplace environment." See Defendants' Reply
in Support of Motion for Summary Judgment, Docket Entry No. 38,
p. 12. The SPA itself discusses the "environment or workplace" and
elsewhere only the "environment." See SPA§ 3.15(b), Exhibit 1 to
Defendants' Motion, Docket Entry No. 30-1, p. 35; id. § 5.22(f),
p. 104.
-31-

Illinois statutory interpretation specific to the issues raised by
that statute, which apportioned liability in multi-defendant cases
involving bodily injury,

death,

based on negligence or product
liability.
ch. 110,

~

or physical damage to property,
liability based on strict

tort

See Tragarz, 980 F.2d at 425 (quoting Ill. Rev. Stat.,
2-1117).

The court noted that, because they are "two

very different statutes," "we must remember that CERCLA, a federal
statute,

focuses

on the national

concern of public health and

environment while Illinois•s joint and several liability statute
focuses on individual, personal injury and property claims.

With

this change in focus may come a change in the meaning of the term
environment."

Id. at 427, 428.

The Seventh Circuit's holding was made

in the

absence of

guidance from Illinois courts on the meaning of Illinois'

tort

fault distribution statute, while New York courts have interpreted
"discharge" and "dispersal" in the environmental context.
at 426, 427.
regarding

See id.

The Tragarz court also recognized its own precedent
the

use

of

"discharge"

and

"dispose"

in

the

environmental/CERCLA context, which aligns with New York courts'
interpretation.

See id. at 427

(acknowledging its prior holding

that "release into the environment from a facility under [the reauthorization of CERCLA] did not include releases into the internal
workplace environment,

at

least where a

worker

is

the

injured

party" (discussing Covalt v. Carey Canada Inc., 860 F.2d 1434 (7th

-32-

Cir. 1988)).

"Clauses can, of course, be ambiguous in one context

and not another."

Continental Casualty, 609 N.E.2d at 512, 513. 78

The court finds that "disposed of on" and "discharged into"
are terms of art that should be interpreted according to their
technical meaning and concludes that the contract is unambiguous. 79
See, e.g., Belt Painting Corp., 795 N.E.2d at 20 (" [T]he terms used
in

the

exclusion

to

describe

the

method of

pollution-such as

'discharge' and 'dispersal'-are 'terms of art in environmental law
used with reference to damage or injury caused by disposal or
containment of hazardous waste.'")

(citation omitted).

They must

also be read in the context of the contract as a whole.

Wyman

broadly assumed Forged Products' liabilities, while Cooper retained
liability Regulated Materials "disposed of on" or "discharged into"
the

environment,

as

commonly

understood

in

the

context

of

78

The court held that the clause was ambiguous "with regard to
whether the asbestos fibers at issue-fibers inhaled by persons
working closely with or suffering long-term exposure to asbestos
products-were discharged into the 'atmosphere' as contemplated by
the exclusion."
Id. at 512; see also id. at 513 ("Ambiguity is
further revealed by examining the purpose of the clause, meant to
exclude coverage for environmental pollution.") (citation omitted).
79

Although the court cannot consider extrinsic evidence when
the terms of a contract are unambiguous, the court notes that its
conclusion is
consistent with that
of
the
Cooper-Cameron
arbitration panel, which found it "clear from the SPA that Cooper
transferred all liabilities to [Wyman] in the SPA" including
asbestos liabilities, so that the underlying asbestos lawsuits
related to Forged Products were not Cooper's Retained Liabilities
under the subsequent ATA.
See Cameron Corporation, Claimant, and
Cooper Industries, LLC, Respondent, Panel's Decision on Motions for
Summary Judgment ("Arbitration Panel's Decision"), Exhibit 13 to
Plaintiff's Motion, Docket Entry No. 28-16, p. 3.
-33-

environmental

See

regulations.

N.Y.S.2d at 52.

Madison Avenue

Leasehold,

811

Likewise, "environment," when read in the context

of the SPA as a whole, unambiguously describes something besides
the internal workplace, which is a separate term used elsewhere and
omitted from§ 5.22(f).

See Uribe, 693 N.E.2d at 743.

Therefore,

the court concludes that Cooper is entitled to summary judgment on
its

first

claim

against

Wyman

regarding

construction

of

SPA

entitled

summary

§ § 5 . 2 2 ( e ) and ( f ) .
B.

SPA§ 5.22(c)

Defendants

also

argue

that

they

are

to

judgment "because no duty to indemnify is owed under the SPA until
Losses

exceed

$100,000

pursuant

to

Section 5.22(c) of the SPA provides in full:

Section

5.22(c)." 80

"Notwithstanding any

contrary provision, no claim by either party against the other for
indemnification arising under this Article V shall be valid and
assertible unless the aggregate amount of Losses associated with
such claim shall exceed $100,000." 81

Defendants argue that since

"Cooper previously admitted that its total Losses associated with
Mr. Gatlin's claim are less than $15,000 . . . until and unless the

80

Defendants' Motion, Docket Entry No. 29, p. 27 ("Cooper's
requests for declaratory relief are overbroad and should be denied
except in particular cases where Cooper proves it has satisfied the
contractual requirements for indemnification[.]"); Defendants'
Response, Docket Entry No. 34, pp. 26-27.
81

SPA § 5.22(c), Exhibit 1 to Defendants' Motion, Docket Entry
No. 30-1, p. 101.
-34-

total

Losses

Cooper." 82

exceed

$100, 000,

Wyman has

no

duty

to

indemnify

Cooper responds that asbestos personal-injury claims in

the aggregate are well in excess of $100,000 and that Defendants
waived a
claims

contrary construction of the SPA by paying individual

under

$100, 000

for

over

a

decade. 83

"A

waiver,

the

intentional relinquishment of a known right, may be accomplished by
express agreement or by such conduct or failure to act as to evince
an

intent

not

to

claim

the

purported

Consolidated Edison Co. of New York,
(N.Y. 1978)

advantage."

Hadden v.

Inc., 382 N.E.2d 1136, 1138

(citations omitted); see also Gilbert Frank Corp. v.

Federal Insurance Co., 520 N.E.2d 512, 514 (N.Y. 1988).

The court

concludes that summary judgment for Defendants is not appropriate
on this issue given the use of the word "aggregate" and Defendants'
ongoing practice of contributing to individual claims of less than
$1001 000 • 84

c.

Estoppel

Cooper
subsequently

argues

that

confirmed

the
in

arbitration
state

court,

decision,

which

collaterally

was

estops

Defendants from arguing that all asbestos-related liability from

82

See Defendants' Motion, Docket Entry No. 29, p. 27.

83

See Plaintiff's Response, Docket Entry No. 31, p. 2 0.

84

See Exhibit 5 to Plaintiff's Response, Docket Entry Nos. 325, 32-6, 32-7, 32-8 (correspondence and invoices regarding multiple
cases); Exhibit 13 to Plaintiff's Response, Docket Entry No. 32-16,
pp. 8-10 (arbitration demand with summary chart of payments, none
of which exceed $100,000); Exhibit 14 to Plaintiff's Response,
Docket Entry No. 32-17 (invoices to and checks from Wyman for
Bentley litigation beginning in 1995 totaling less than $43,000).
-35-

the Katy Road site remained with Cooper. 85

Defendants argue that

they are entitled to summary judgment on this claim because they
were not parties to the arbitration nor in privity with any party
to
§

the

arbitration,

and

the

indemnification

obligations

under

5.22(f) were not fully and fairly litigated. 86
Collateral estoppel "precludes the relitigation of identical

issues of fact or law which were actually litigated and essential
to the prior judgment."
S.W.2d

714,

721-22

Eagle Properties, Ltd. v. Scharbauer, 807

(Tex.

1990).
(1)

collateral estoppel must show:

A party

seeking

to

invoke

the facts sought to be liti-

gated in the second action were fully and fairly litigated in the
first action;

(2) the facts were essential to the judgment in the

first action; and (3) the parties, or persons in privity with them,
were cast as adversaries in the first action.

See Daniels v.

Equitable Life Assurance Society of the United States, 35 F.3d 210,
213-14 (5th Cir. 1994)
(Tex.

1990);

(citing Mower v. Boyer, 811 S.W.2d 560, 563

Eagle Properties,

807 S.W.2d at

721;

Bonniwell v.

Beech Aircraft Corp., 663 S.W.2d 816, 818 (Tex. 1984)); Calabrian
Corp. v. Alliance Specialty Chemicals,
(Tex. App.-Houston

[14th Dist.]

2013,

Inc.,

418 S.W.3d 154, 158

no pet.); John G.

& Marie

Stella Kenedy Memorial Found. v. Dewhurst, 90 S.W.3d 268, 288 (Tex.

85

See Plaintiff's Motion, Docket Entry No.
27, p.
23;
Arbitration Panel's Decision on Motions for Summary Judgment,
Exhibit 13 to Plaintiff's Motion, Docket Entry No. 28-16; Judgment
Confirming Arbitration Award Under Seal, Exhibit 15 to Plaintiff's
Motion, Docket Entry No. 28-18.
86

See Defendants' Motion, Docket Entry No. 29, pp. 28-30.
-36-

2002).

Federal courts "give the same preclusive effect to state

court judgments that those judgments would be given under the law
of the state in which judgment was rendered."
213 (citing 28 U.S.C.

§

Daniels, 35 F.3d at

1738).

Genuine issues of material fact remain regarding Wyman and
Precision's
arbitration.
tion

and

did

relationship

agent

in the

consent

Cameron

and

the

Cooper-Cameron

Wyman and Precision were not parties to the arbitranot

have

a

arbitration with Cooper. 87
at the time,

to

contractual

right

to

participate

in

Bruce Himmelreich, counsel for Cameron

testified that Cameron did not act as Defendants'
arbitration,

from Defendants,

Cameron did not
Cameron did not

seek any advice or
report

to Defendants

regarding the status of the arbitration, Cameron never agreed to
pursue any argument or strategy for the benefit of Defendants, and
Cameron never shared any information or ideas with Defendants in
order to pursue any arguments in the arbitration. 88

Cooper contends

that Wyman coordinated with Cameron regarding the Forged Products
claims, as evidenced by emails and the Rule 11 Agreement. 89

87

Himmelreich Deposition, Exhibit 5 to Defendants' Motion,
Docket Entry No. 30-5, p. 10 at 74:7-23; p. 11 at 92:24 top. 12 at
93:4.
88

See id. p. 16 at 97:1 top. 17 at 98:2.

89

See Email from Emi Donis (Precision) re: ADR in Cooper/Wyman
agreement, Exhibit 8 to Plaintiff's Motion, Docket Entry No. 28-11
("We could send our written dispute notice at the same time you
serve your arbitration claim, which would require them to meet with
us
The Cameron/Wyman one- two punch should get their
attention."); Email from Susan Swanson (counsel for Cameron) re:
Cameron v.
Wyman Gordon/Precision Castparts,
Exhibit 9 to
(continued ... )
-37-

"Although the circumstances of each case must be examined,
generally,

parties

estoppel when:
parties to it;

are

(1)
(2)

in privity

for

purposes

of

collateral

they control an action even if they are not
their interests are represented by a party to

the action; or (3) they are successors in interest .

II

Exploration Co. v. Neel, 982 S.W.2d 881, 890 (Tex. 1998); see also
Ayre

v.

J.D.

Bucky Allshouse,

P.C.,

942

S.W.2d

App.-Houston [14th Dist.] 1996, writ denied)

24,

27

(Tex.

("A privy is one who

is connected in law with a party to the judgment as to have such an
identity of interests that the party to the judgment represented
the same legal right.

(citation omitted) . . .

90

However, privity

is not established by the mere fact that persons may happen to be
interested in the same question or in proving the same facts.
Phillips v.

Allums,

882 S.W.2d 71,

Dist.] 1994, writ denied)")

74

(Tex.

App.-Houston

[14th

(citing Benson v. Wanda Petroleum Co.,

468 S.W.2d 361, 363 (Tex. 1971).)) . 91

Based on the summary judgment

( • • • continued)
Plaintiff's Motion,
Docket
Entry No.
28-12
("Pursuant
to
discussions during the telephone conference on May 21, 2009,
attached please find Cameron's arbitration demand directed to
[Cooper] that we plan to send today.") ; Rule 11 Agreement,
Exhibit 7 to Plaintiff's Motion, Docket Entry No. 28-10.
89

90

The parties agree that Texas law applies to this issue. See
Plaintiff's Motion, Docket Entry No. 27, p. 24 n.16; Defendants'
Motion, Docket Entry No. 29, p. 28.
Plaintiffs cite Taylor v. Sturgell, 128 s. Ct. 2161, 2179
(2008), but that case addressed the situation where "preclusion
[applies] because a nonparty to an earlier litigation has brought
suit as a representative or agent of a party who is bound by the
prior adjudication."
Here, Cooper is arguing that a party to
current litigation was formerly represented by another party in an
earlier adjudication.
91

-38-

evidence, the court cannot conclude that Cameron was controlled by
Wyman and Precision or that their interests were represented by a
party with "such an identity of interests that the party to the
judgment represented the same legal right." 92

While they may have

been interested in the same question or proving the same facts,
Defendants have provided evidence sufficient to raise a factual
question as to whether Cameron and Precision and Wyman were in
privity.

92

Cooper argues that "Wyman should also be precluded from
disavowing responsibility for Forged Products personal injury
asbestos claims based on the doctrine of quasi-estoppel."
Plaintiff's Motion, Docket Entry No. 27, p. 29.
Because Wyman
accepted its liability for more than a decade, Cooper asserts that
it did not bring an action to enforce the SPA years ago, when more
documents and witnesses were available.
See id.
Cooper asserts
that Wyman benefitted by accepting insurance proceeds from Cameron
for some of the claims.
"Quasi-estoppel precludes a party from
asserting, to another's disadvantage, a right inconsistent with a
position previously taken.
The doctrine applies when it would be
unconscionable
to allow a
person to maintain a
position
inconsistent with one to which he acquiesced, or from which he
accepted a benefit."
Lopez v. Munoz, Hockema & Reed, L.L.P., 22
S.W.3d 857, 864 (Tex. 2000) (citations omitted). Quasi-estoppel is
an equitable doctrine that generally operates as an affirmative
defense, and can thus be waived.
See Stinnett v. Colorado
Interstate Gas Co., 227 F.3d 247, 256 (5th Cir. 2000); Yturria v.
Kerr-McGee Oil & Gas Onshore, LP, No. 7:05-cv-181, 2006 WL 3227326,
at *12 (S.D. Tex. Nov. 6, 2006), aff'd sub nom. Yturria v. KerrMcGee Oil & Gas Onshore, LLC, 291 F. App'x 626 (5th Cir. 2008).
Cooper argues that it is not an affirmative defense in this case
because Defendants have not asserted counterclaims. Quasi-estoppel
is not mentioned in any pleading except Plaintiff's Motion and
Reply in Support, and defendants argue that it is waived now that
discovery has closed, prejudicing Defendants' ability to respond.
Lucas v. United States, 807 F.2d 414, 417-18 (5th Cir. 1986)
(citations omitted); see also Fed. R. Civ. P. 8(c). Cooper is not
entitled to summary judgment on this issue, if it is even entitled
to raise it at this point in the litigation.
-39-

D.

Precision's Liability Under the SPA
Defendants

argue

that

Precision

is

entitled

to

summary

judgment because it is not liable for any obligations under the SPA
as

a

non-party

thereto.

93

Cooper

responds

that

Precision

has

adopted Wyman's obligations under the SPA since acquiring Wyman in
2000 and should not be allowed to now hide behind its corporate
form.

94

Defendants argue that "[l] iabili ty can never be predicated

solely upon the

fact

of

a

parent

corporation's

ownership of a

controlling interest in the shares of its subsidiary."
v.

St.

2010)
must

Paul Travelers Group,
(citation omitted).

allege

corporation

"facts
in

liabilities." 95

75 A.D.3d 740,

Thus,

sufficient

order

to

make

743

(N.Y. App.

Defendants argue,
to
it

pierce
liable

the
for

SUS, Inc.

veil
its

Div.

the plaintiff
of

a

parent

subsidiary's

See generally id.

Under Oregon law, which the parties agree applies,
the corporate veil

96

"piercing

'is an extraordinary remedy which exists as a

93

Defendants' Motion, Docket Entry No. 29, p. 7.

94

See Plaintiff's Response, Docket Entry No. 31, pp. 22-24.

95

See Defendants' Motion, Docket Entry No. 29, p. 30.

96

Defendants cite New York choice of law principles, which
dictate that "[t]he law of the state of incorporation determines
when the corporate form will be disregarded and liability will be
imposed on shareholders."
See Defendants' Motion, Docket Entry
No. 29, p. 30 n.3 (quoting Fletcher v. Atex, Inc., 68 F.3d 1451,
1456 (2d Cir. 1995) (citations omitted)).
Precision is an Oregon
corporation, and thus Oregon law therefore applies.
Id. (citing
Complaint, Docket Entry No. 1, p. 2 ~ 5) .
Cooper does not
challenge these assertions and cites the same Oregon case in
support of its veil-piercing and alter ego arguments.
See
Plaintiff's Response, Docket Entry No. 31, p. 23.
-40-

last resort, where there is no other adequate and available remedy
to repair plaintiff's injury."

State ex rel. Neidig v. Superior

National Insurance Co., 173 P.3d 123, 131 (Or. 2007)

Oregon law

"requires a plaintiff seeking to pierce the corporate veil to prove
that

another

control with)

entity

actually

controlled

the corporation,

that

(or

was

under

common

the other entity used its

control over the corporation to engage in improper conduct,

and

that,

was

as

harmed."

a

result

of

the

improper

conduct,

the

plaintiff

Id. at 136.

Cooper responds that Precision is liable because it controlled
Wyman and acted as Wyman's alter ego. 97

As examples, Cooper points

to evidence in the summary judgment record that Precision made
payments to Cooper for Forged Products liabilities on Precision
checks; 98

demanded

mediation

under

the

SPA

in

a

letter

from

Precision's Deputy General Counsel on Precision letterhead; 99 and
participated,

via the attendance of

Precision's Deputy General

Counsel, in settlement talks in the Sutterfield case in which Wyman
was sued for Forged Products liabilities . 100
97

Precision's counsel

See Plaintiff's Response, Docket Entry No. 31, p. 23.

98

See,
e.g.,
Precision checks made payable to Cooper,
Exhibit 5-2 to Plaintiff's Motion, Docket Entry No. 28-6, pp. 173,
175, 177, 179.
99

See Confidential Settlement Negotiations dated June 3, 2009,
Re: Indemnity Dispute from Precision to Cooper, Exhibit 10 to
Plaintiff's Motion,
Docket Entry No.
28-13; Exhibit 17 to
Plaintiff's Response, Docket Entry No. 32-20.
100

See Himmelreich Deposition,
Response, Docket Entry No. 32-9, p.
34:9-25.
-41-

Exhibit 6 to Plaintiff's
4 at 26:7-27:5 and p. 6 at

worked

with

Cameron

in

seeking

arbitration

against

Cooper. 101

Cooper also argues that Precision "orchestrated and carried outn
the "repudiation of Wyman's responsibilities under the SPA,n which
justifies piercing the corporate veil. 102

Given this evidence, the

court concludes that Cooper has raised a genuine issue of material
fact

regarding Precision's

liability,

and summary judgment

for

Defendants is not appropriate on this point.
IV.

Conclusion and Order

For the reasons discussed above,

the

court concludes that

summary judgment in Cooper's favor is appropriate on its first
claim regarding construction of the SPA's indemnity provisions as
they apply to Wyman.

The parties' agreement unambiguously assigns

the duty to indemnify and defend asbestos personal-injury claims
stemming from employment at the Katy Road site to Wyman.

However,

fact issues remain regarding the meaning of the $100,000 "aggregate
amount of Lossesn

in

signatory to the SPA,

§

5. 22 (c),

Precision's liability as a non-

and Cooper's estoppel claims.

Plaintiff Cooper Industries,

LLC' s

Motion for

Therefore,

Summary Judgment

101

See Email from Emi Donis (Precision) re: ADR in Cooper /Wyman
agreement, Exhibit 8 to Plaintiff's Motion, Docket Entry No. 28-11;
Exhibit 15 to Plaintiff's Response, Docket Entry No. 32-18.
102

See Plaintiff's Response, Docket Entry No. 31, pp. 23-24;
Himmelreich Deposition, Exhibit 6 to Plaintiff's Response, Docket
Entry No. 32-9, p. 4 at 26:7-25; Email from Himmelreich at Cameron
to Precision and Wyman detailing the concern at the breakdown of
the
payment
arrangement
after
the
Sutterfield
settlement,
Exhibit 18 to Plaintiff's Response, Docket Entry No. 32-21.
-42-

(Docket Entry No. 27) is GRANTED IN PART and Defendants' Motion for
Summary Judgment (Docket Entry No. 29) is DENIED.
Since fact issues remain for trial, the Joint Pretrial Order
will be filed by October 7, 2016, and Docket Call will be held on
October 14,

2016,

at

3:00

p.m.,

in

Courtroom

9-B,

9th

Floor,

United States Courthouse, 515 Rusk Avenue, Houston, Texas 77002.
SIGNED at Houston, Texas, on this 14th day of September, 2016.

LAKE
UNITED STATES DISTRICT JUDGE

-43-