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FEDERATED MUTUAL INS. CO. v. WOODSTOCK `99 LLC

March 7, 2002

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


The opinion of the court was delivered by: David N. Hurd, United States District Judge.

MEMORANDUM-DECISION AND ORDER

I. INTRODUCTION

Based on this prior decision, Woodstock now moves for summary judgment against Ace pursuant to Federal Rule of Civil Procedure 56. Ace opposes. Oral argument was heard on August 10, 2001, in Utica, New York. Decision was reserved.

II. FACTS

Familiarity with the facts as stated in the April 23, 2001, decision is assumed. Additional facts necessary to the instant decision are briefly set forth below. Woodstock operated the Woodstock '99 festival in Rome, New York during the summer of 1999 (the "festival"). 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.*fn1 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. In addition, the Woodstock agreement required the supplier designated by Ace to waive subrogation against Woodstock. Exhibit A to the Woodstock agreement provided that "[Ace] and/or [Ace's] Retailer shall obtain insurance coverage, and shall provide evidence of such insurance as follows. All insurance shall waive subrogation against any of the Indemnities and shall name the Indemnities as additional insureds. . . ."

Ace obtained insurance which satisfied these requirements. In the American letter agreement, Ace informed American that, pursuant to the Woodstock agreement, American was also required to

indemnify, defend and save harmless Ace Hardware Corporation, Woodstock `99, the Government Entities as defined in the Agreement, and their respective members, employees, contractors, subcontractors, and assigns against and from all costs, damages, settlements, judgments, fines, assessments, expenses, losses, liabilities, judgment executions, penalties, suits or fees imposed on, incurred by, or asserted against them by reason of the acts and/or omissions of American Hardwall Supply Co., its subcontractors, licensees, sublicensees, assignees, suppliers, volunteers, and/or employees and agents[.]

(Katz Aff. Exh. B.) In addition, the American letter agreement stated that Ace had received American's certificate of insurance and was having it reviewed by Ace's insurance department. (Id.) It is undisputed that the insurance obtained by American, and reviewed and approved by Ace's in-house counsel, neither waived subrogation against Woodstock, nor named it as an additional insured.

American subsequently sustained significant damage to its property at the festival, and its insurer, Federated, commenced this action against Woodstock for negligence with regard to, inter alia, festival security. The third-party complaint against Ace alleges breach of contract and contractual indemnification.

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 (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 (1962); Hawkins v. Steingut, 829 F.2d 317, 319 (2d Cir. 1987). Nevertheless, "the litigant opposing summary ...


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