the withdrawal liability of $ 2,274,342.50, interest, billing charges, amortization charges, additional interest or liquidated damages and post-judgment interest (the "Ringle Withdrawal Liability").
Defendant moves for summary judgment asserting: (1) that the Agreement in Machinery Trailers bars any further claims plaintiffs may have against any common control group members for the Ringle Withdrawal Liability; (2) that defendant is a third party beneficiary to the Agreement; (3) that the $ 800,000.00 paid under the Agreement effected an accord and satisfaction of all Ringle withdrawal liability; and (4) that plaintiffs' action is barred by the statute of limitations. Because the court finds that plaintiffs released defendant under the Agreement, the court will not address defendants' remaining arguments.
Under Fed.R.Civ.P. 56(c), a court should grant a summary judgement motion if "there is no genuine issue of material fact and . . . the moving party is entitled to judgment as a matter of law." The burden is on the moving party to identify portions of the pleadings, answers to interrogatories, and affidavits which demonstrate an absence of a genuine issue of material fact. Id.; Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265 (1986). The burden then shifts to the non-moving party to "set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(c). When reviewing a summary judgement motion, the court must read the facts in a light most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S. Ct. 2505, 2513, 91 L. Ed. 2d 202 (1986).
Where the party opposing summary judgment bears the burden of proof on a dispositive issue, it must offer specific evidence demonstrating a factual basis on which it is entitled to relief. Id., 477 U.S. at 256. The party may not rely on conclusory allegations or speculation alone to oppose summary judgment. Anderson v. Stauffer Chemical Co., 965 F.2d 397, 402 (7th Cir., 1992). The non-moving party must set forth specific facts, through affidavits or other materials, that demonstrate disputed material facts. Anderson v. Liberty Lobby, Inc., 477 U.S. at 256, 106 S. Ct. at 2514. "The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Id., 477 U.S. at 247-48, 106 S. Ct. at 2510 [emphasis in original].
Settlement Agreement Interpretation
In construing a settlement agreement under Illinois law, the Seventh Circuit applies a two part inquiry identical to the construction of any contract: (1) examine the plain language of the applicable provisions at issue; and (2) determine if the contract terms are ambiguous. Lumpkin v. Envirodyne, 933 F.2d 449, 456 (7th Cir. 1991). When the terms of a contract are clear and certain, the contract itself is the only proper evidence of the parties' intent, and the court may not infer that intent which is contrary to the contract's obvious meaning. Thomas Brady v. Prairie Material Sales, Inc., 190 Ill. App. 3d 571, 578, 546 N.E.2d 802, 806, 137 Ill. Dec. 857 (Ill. App. 2d Dist., 1989); Gold v. Ziff Communications, Co., 265 Ill. App. 3d 953, 638 N.E.2d 756, 762, 202 Ill. Dec. 888 (Ill. App. 1 Dist., 1994) (where the provisions of a contract are clear and unambiguous, extrinsic evidence cannot be used to show that the parties drafting the document intended something else). While a contract that is reasonably susceptible to more than one interpretation is considered ambiguous, a contract is not ambiguous "if the court can determine its meaning without any guide other than a knowledge of the simple facts on which, from the nature of language in general, its meaning depends." Murphy v. S-M Delaware, Inc., 95 Ill. App. 3d 562, 565, 420 N.E.2d 456, 459, 51 Ill. Dec. 42 (1st Dist. 1981). A contract is not ambiguous simply because the parties disagree about its meaning. Id.
In a case where a federal cause of action is at issue, federal law governs the extent to which unnamed parties are bound by a release. Lumpkin, 933 F.2d at 457. Because there is no federal common law, federal courts should apply the applicable state law. Id. While the intention of the parties controls the scope and effect of the release, such intent is discerned from the language used in the release and the circumstances of the transaction. Carona v. Illinois Cent. Gulf R. Co., 203 Ill. App. 3d 947, 950, 561 N.E.2d 239, 242, 148 Ill. Dec. 933 (5th Dist. 1990).
The court finds that the language in the Agreement at issue is unambiguous, and thus the instrument speaks for itself. Therefore, the court will determine and enforce the meaning and intention of the parties from the face of the contract as written, without reference to any previous negotiations. Central Prod. Credit Ass'n v. Hans, 189 Ill. App. 3d 889, 900, 545 N.E.2d 1063, 1070-71, 137 Ill. Dec. 302 (2d Dist. 1989). Lumpkin, 933 F.2d at 459.
Defendant argues that the Agreement releases any cause of action against any corporation that is in Ringle's common control group. Paragraph 2 of the Agreement states that with the payment of $ 800,000.00, "the Pension Fund [plaintiffs in the instant case] shall and does hereby satisfy release, acquit and forever discharge the McGriffs and any members of any group of trades or businesses under common control with Ringle. . . arising out of or in any way connected with . . . the Ringle Withdrawal Liability.
(Emphasis added.) Accordingly, because the complaint alleges that defendant is liable for damages as the alter-ego of a business under common control with Ringle, defendant was released by the clear language of paragraph 2. Brady, 190 Ill. App. 3d at 574, 546 N.E.2d at 804 (express language of a release can extinguish the underlying cause of action as to other persons not a party to the agreement).
Defendant further asserts that the damages alleged in plaintiffs' second amended complaint are the same as those released in the Agreement. In the Agreement, plaintiffs defined the damages for its cause of action as the "entire amount of the [Ringle] withdrawal liability assessment of $ 2,274,342.50, interest in the amount of $ 748,278.76, liquidated damages in the amount of $ 748,278.76, billing charges in the amount of $ 15,275.88, amortization charges in the amount of $ 462,228.47, attorney fees and court costs."
These damages are the same damages plaintiffs now seek from defendant. The court finds that the language in the Agreement compels the conclusion that plaintiffs released all causes of action for the Ringle Withdrawal Liability and that the Agreement extends to defendant, which is being sued as a "trade or business under common control" with Ringle.
Both parties assert that the language in paragraph "K" supports their arguments: plaintiffs assert that if the parties intended to release all possible claims of non-parties, the parties would not have expressed a desire to settle only those claims "brought in the Federal Court Case relating to the Ringle Withdrawal Liability"; defendant argues that the Agreement's release [of] any and all claims arising out of or in any way connected with the Federal Court Case and the Ringle Withdrawal Liability" unambiguously states the parties' intent to release the actual withdrawal liability, and the event creating the withdrawal liability not only to the named parties, but to all corporations that are related to the withdrawal liability.
The parties' addition of the final clause in paragraph K, "and the Ringle Withdrawal Liability" (emphasis added), expressed their intent not only to settle the claims in the Machinery Trailer case, but to release any cause of action arising from the events that created the Ringle Withdrawal Liability. Grigoleit, Inc. v. Board of Trustees of Sanitary Dist. of Decatur, 233 Ill. App. 3d 606, 615, 599 N.E.2d 51, 57, 174 Ill. Dec. 505 (4 Dist. 1992), pet for appeal den., 147 Ill. 2d 627, 180 Ill. Dec. 149, 606 N.E.2d 1226 (Ill. 1992). This conclusion is supported by the fact that in the first part of the sentence in paragraph K the drafters did not end the paragraph after specifically expressing the desire to compromise the claims brought in the Machinery Trailer "Federal Court Case relating to the Withdrawal Liability." (Emphasis added.) Much as plaintiffs attempt to have the court stop at that point, the drafters of the Agreement did not. The parties went on to add the final clause of the sentence, "and the Pension Fund desires to fully and finally release any and all claims arising out of or in any way connected with the Federal Court Case and the Ringle Withdrawal Liability." (Emphasis added.) The court notes that the drafters used the conjunction "and" before "the Ringle Withdrawal Liability" instead of the adverb "relating" as was used in the first part of the sentence. The court finds as a matter of law that the intent of the Agreement was to release both the parties in the Machinery Trailer case and all causes of action arising out of the events creating the Ringle Withdrawal Liability.
Plaintiffs assert that the intent of paragraph K must have been to release only the parties in the Machinery Trailer case, because the initial draft of the Agreement identified each and every person or entity that would be released thereunder, and that defense counsel had made what they called "very minor changes." Because the court finds that the terms of the Settlement Agreement are unambiguous, it will not consider evidence of the negotiations leading to the settlement or evidence of the parties' intent during those negotiations to interpret the terms of the Settlement. Rakowski v. Lucente, (1984), 104 Ill. 2d 317, 472 N.E.2d 791, 84 Ill. Dec. 654. Gold v. Ziff Communications, Co., 265 Ill. App. 3d 953, 638 N.E.2d 756, 762, 202 Ill. Dec. 888 (Ill.App. 1 Dist., 1994). The only relevant evidence of the intent of the Agreement is the final document that was signed by all of the parties. Based on the terms of the Agreement, the court finds that the release of plaintiffs' cause of action for damages for the Ringle Withdrawal Liability was intended to benefit all businesses under common control with Ringle within the meaning of § 4001(b)(1) of ERISA.
Based on the Agreement and the uncontested facts and evidence in this case, taken as favorably to the plaintiffs as the evidence permits, the court finds that plaintiffs are barred from asserting their cause of action in the instant case. Accordingly, the court grants defendant's motion for summary judgment.
ENTER: April 11, 1995
Robert W. Gettleman
United States District Judge