United States District Court, N.D. Illinois, Eastern Division
ANGELA NEAL, individually and as Mother and next friend of KEON REEVES, a minor, Plaintiff,
TARGET CORPORATION, et al., Defendants.
Jeffrey T. Gilbert, United States Magistrate Judge.
Target Corporation's Petition to Enter Judgment [ECF No.
220] is granted in part and denied in part. See Statement
below for further details.
1, 2015, the then-presiding District Judge in this case
granted partial summary judgment in favor of
Defendant/Cross-Plaintiff Target Corporation
("Target"). [ECF No. 150.] Specifically, the Court
granted summary judgment on Target's express
indemnification and breach of contract claims against
Defendants/Cross-Claim Defendants Home Niches, Inc.,
("Niches") and Walsay, Inc. ("Walsay") -
Counts II, III, V, and VI of Target's Crossclaim. [ECF
No. 32, ¶¶ 17-22, 23-28, 34-40, 41-46; ECF No. 150,
at 8-11, 11-12.] Then, on July 20, 2015, the Court directed
entry of final judgment pursuant to Federal Rule of Civil
Procedure 54(b) as to the partial summary judgment entered in
favor of Target. [ECF No. 156.] Neither Niches nor Walsay
appealed that judgment.
November 13, 2015, the parties settled the remainder of the
case. [ECF No. 176.] On that same day, all parties consented
to this Magistrate Judge pursuant to 28 U.S.C. § 636(c).
[ECF No. 178.] But the case did not come to a peaceful close.
Instead, a lengthy dispute arose about one particular aspect
of settlement, which the Court resolved on June 15, 2016.
[ECF No. 217.]
thereafter, Target filed a Petition to Enter Judgment
("the Petition"), accompanied by supporting
documentation. [ECF Nos. 220, 221.] Walsay responded to the
Petition. [ECF No. 229.] Niches never filed a response.
requests that the Court enter judgment against Walsay and
Niches in the amount of $494, 127.96. That amount includes
legal fees and costs and a portion of the settlement payment.
[ECF No. 220, at 1.] Walsay does not contest much of this.
For instance, Walsay does not argue that judgment should not
be entered and it does not dispute most of the amounts that
Target claims. Walsay also does not contend that Target's
attorneys' billing rates or the amount of time spent on
particular tasks are unreasonable. Walsay raises only two
first points out that a small amount of the legal expenses
Target included in its Petition was incurred for work
unrelated to the present dispute. [ECF No. 229, at 3.] These
expenses total $253.00. Id. Target concedes these
expenses were "inadvertently included in Target's
petition, " and that the judgment should be reduced by
$253.00. [ECF No. 231, at 2 n.l, 4.] That lowers Target's
requested amount to $493, 874.96. Id. at 4 n.4. That
other objection requires some additional background
information before it can be addressed on the merits. After
Angela Neal filed the present lawsuit, Northern Insurance
Company ("Northern"), Walsay's insurer, filed a
declaratory judgment action in Michigan against Walsay,
Niches, and Target ("the Michigan Coverage
Action"). [ECF No. 217, at 3.] Late last year, Niches
and Walsay were dismissed with prejudice from the Michigan
Coverage Action. Id. That left only Target and
Northern fighting about, in essence, whether Northern must
reimburse Target for amounts that Target paid to defend and
settle the instant case. Id. at 3, 7-8.
argues that Target improperly is attempting to collect $45,
678.00 in expenses incurred by Target's attorneys for
work "related to [the] Northern Dispute" ("the
Northern Dispute expenses"). [ECF No. 229-2.] The bulk
of expenses are for time billed by Target's attorneys in
this case for communicating with Target's attorneys in
the Michigan Coverage Action, analyzing how issues in that
case would impact this case and vice versa, and resolving a
dispute about the settlement of this case. According to
Walsay, the Northern Dispute expenses should not be included
in the judgment entered in this case because the
indemnification agreement between Target and Walsay and
Niches ("the Agreement") applies "to the
claims of Angela Neal in this lawsuit" and "does
not apply to the litigation between Target and Northern .. .
." Id. at 2. Walsay's interpretation of the
Agreement, however, does not take account of the broad
language to which Walsay and Target agreed when they entered
into the Agreement.
Agreement provides that Walsay "shall defend, indemnify
and hold harmless" Target "from and against any and
all . . . expenses, including costs and attorney fees,
relating to or arising out of any claim or demand of any kind
or nature, which any buyer or user of the Goods, or any other
person . .. may make against [Target], based upon or arising
out of the manufacture, delivery, ticketing, labeling,
packaging, placement, promotion, sale or use of the Goods, or
[Walsay's] performance of or failure to perform in
accordance with the terms of this Contract. .. ." [ECF
No. 123-3, at 17.] The "any claim or demand . . ."
portion of the Agreement clearly encompasses the claim
advanced by Neal in this case ("Neal's claim")
because her claim could be (and was) brought against Target
and arose out of the defective production of "the
Goods." No party contends otherwise. It is the
"relating to or arising out of any claim or demand"
language that is at issue.
Court disagrees with Walsay's overly narrow
interpretation of the Agreement. Essentially, Walsay reads
the Agreement to apply only to the expenses that Target
incurred in defending against Neal's personal injury
claim. But the text of the Agreement is broader. It entitles
Target to any and all expenses "relating to or arising
out" of Neal's claim against Target. There is
nothing about this language that indicates it is as limited
as Walsay contends. Walsay's interpretation is not
consistent with the plain meaning of the phrase
"relating to or arising out of which is broad language
of inclusion. In the Court's view, the Northern Dispute
expenses are encompassed within that language.
is not attempting to recover from Walsay or Niches its costs
in defending the Michigan Coverage Action and it would not be
able to do so; the language in the Agreement does not go that
far. But the Michigan Coverage Action is not completely
unrelated to this case and time that Target's attorneys
in this case spent monitoring that case or taking account of
it in defending against Neal's claim in this case relates
to or arises out of Neal's claim against Target within
the meaning of the Agreement. Moreover, Northern sent its
Michigan Coverage Action attorney and a corporate
representative to two settlement conferences in this court.
Id. at 7. Northern paid some portion of the
settlement in this case. Id. at 12. The settlement
term sheet that the parties signed in this case explicitly
discussed the Michigan Coverage Action. Id. at
And it was a fight over whether and how the settlement of
this case affected the Michigan Coverage Action that led to
the previously referenced post-settlement motion practice in
this background, the Court can address whether the specific
categories of expenses to which Walsay objects "relate
to or arise out of Neal's claim ...