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FEDERATED MUT. INS. CO. v. WOODSTOCK '99

April 23, 2001

FEDERATED MUTUAL INSURANCE COMPANY, AS SUBROGEE OF AMERICAN HARDWALL SUPPLY COMPANY OF ROME, INC., D/B/A TRUE VALUE HARDWARE, PLAINTIFF,
v.
WOODSTOCK '99, LLC, DEFENDANT. WOODSTOCK '99, LLC, THIRD-PARTY PLAINTIFF, V. ACE HARDWARE CORPORATION, THIRD-PARTY DEFENDANT.



The opinion of the court was delivered by: Hurd, District Judge.

MEMORANDUM-DECISION AND ORDER

I. INTRODUCTION

On March 6, 2000, plaintiff Federated Mutual Insurance Co. ("Federated") commenced the instant action as subrogee of American Hardwall Supply Company of Rome ("American") against defendant Woodstock '99, LLC ("Woodstock") to recover payments in excess of $600,000 made to its insured, American. Woodstock answered the complaint, and also filed a third-party action against third-party defendant Ace Hardware Corporation ("Ace").*fn1

Federated now moves for partial summary judgment to dismiss Woodstock's Thirteenth Affirmative Defense (waiver of subrogation) pursuant to Federal Rule of Civil Procedure 56.*fn2 Defendants oppose. Oral argument was heard on April 13, 2001, in Utica, New York. Decision was reserved.

II. FACTS

Woodstock operated the Woodstock '99 festival in Rome, New York during the summer of 1999 (the "festival"). This action arises out of property damage sustained by American at the festival. It is based upon the alleged negligence of Woodstock in failing to maintain security and crowd control. Because of the limited nature of the relief sought on the instant motion, only the facts pertinent to this motion will be stated herein.

Ace contracted with Woodstock to become a sponsor for the festival (the "Woodstock agreement"). Pursuant to the Woodstock agreement, Ace had the right to designate a supplier of camping supply products for the festival. By letter agreement dated July 16, 1999 (the "American letter agreement"), Ace designated American as the exclusive supplier of camping supply products at the festival. The American letter agreement required American to indemnify Ace and Woodstock (as well as certain other parties), and to obtain suitable insurance. Plaintiff was the insurer of American for purposes of the festival.

Pursuant to the Woodstock agreement, Ace was obligated to indemnify Woodstock for actions arising from the negligence of Ace, and to name Woodstock as an additional insured on Ace's insurance policy for the festival. Ace was also required to waive subrogation as against Woodstock. The Woodstock agreement also required the suppliers designated by Ace to waive subrogation against Woodstock.*fn3

The American letter agreement contained no waiver of subrogation; however, it did contain the following statement:

As you know, Ace Hardware Corporation ("ACE") and Woodstock '99, LLC ("Woodstock '99") entered into a letter agreement dated June 1, 1999. Woodstock '99 has subsequently prepared a formal agreement for Ace's signature, a copy of which is attached for your reference (the "Agreement"). Both the letter agreement and the Agreement provide that one Ace retailer, namely American Hardwall Supply Co. will have the exclusive right to sell camping goods on the grounds of the Woodstock '99 Festival.*fn4

Defendants contend that this "reference" to the Woodstock agreement was intended to incorporate that agreement by reference into the American letter agreement.

III. STANDARD OF REVIEW

A. Summary Judgment

A moving party is entitled to summary judgment "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(c). The ultimate inquiry is whether a reasonable jury could find for the nonmoving party based on the evidence presented, the legitimate inferences that could be drawn from that evidence in favor of the nonmoving party, and the applicable burden of proof. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In determining a motion for summary judgment, all inferences to be drawn from the facts contained in the exhibits and depositions "must be viewed in the light most favorable to the party opposing the motion." United States v. Diebold Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962); Hawkins v. Steingut, 829 F.2d 317, 319 (2d Cir. 1987). Nevertheless, "the litigant ...


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