CSC Scientific Co. v. Manorcare Health Services, Inc.

867 F. Supp. 2d 368, 2011 U.S. Dist. LEXIS 110654, 2011 WL 4495332
CourtDistrict Court, S.D. New York
DecidedSeptember 27, 2011
DocketCourt No. 08-civ-10207 (RKE)
StatusPublished
Cited by4 cases

This text of 867 F. Supp. 2d 368 (CSC Scientific Co. v. Manorcare Health Services, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
CSC Scientific Co. v. Manorcare Health Services, Inc., 867 F. Supp. 2d 368, 2011 U.S. Dist. LEXIS 110654, 2011 WL 4495332 (S.D.N.Y. 2011).

Opinion

OPINION AND ORDER

EATON, District Judge:1

This matter comes before the court on defendant Manorcare Health Services, Inc.’s (“Manorcare” or “defendant”) motion for summary judgment on plaintiff CSC Scientific Company, Inc.’s (“CSC Scientific” or “plaintiff’) claims for contractual and common law indemnification and breach of contract. The court exercises diversity jurisdiction pursuant to 28 U.S.C. § 1332(a) (2006). For the reasons set forth herein, defendant’s motion is granted and plaintiffs claims are dismissed.

I. Factual and Procedural Background

Plaintiff CSC Scientific commenced this action, seeking indemnification from Manorcare for amounts plaintiff paid to non-party VWR International (“VWR”) in connection with a tort claim filed against VWR by Philip Yelin2 (‘Yelin”) in the Supreme Court of the State of New York, County of Westchester (the “Yelin Action”). The Yelin Action involved claims that he was injured as a result of his exposure to asbestos or asbestos-containing products manufactured or sold by “Cenco,” “Central Scientific Company,” and other defendants between 1957 and 1987. Def.’s Statement of Undisputed Facts Pursuant to Local Rule 56.1 ¶¶ 29-30 (“Def.’s 56.1 Statement”).3

Between 1957 and 1987, Manorcare, CSC Scientific, and VWR serially owned the assets of the Central Scientific business, which sold “scientific educational products and selected industrial equipment” under the “Cenco” brand. Def.’s 56.1 Statement ¶¶ 5, 8. On July 31, 1976, Manorcare, which had owned the Central Scientific business since at least 1957, sold the assets to CSC Scientific. Def.’s 56.1 Statement ¶¶ 3-6; see also Acquisition Agreement Between Manorcare and CSC Scientific (the “Manorcare-CSC Agreement”), Lee Deck, Ex. B. On April 17, [371]*3711979, CSC Scientific sold the material assets of the Central Scientific business to VWR. Def.’s 56.1 Statement ¶¶ 18-20; see also Acquisition Agreement Between CSC Scientific and Manorcare (the “CSC-VWR Agreement”), Lee Decl., Ex. C. Thus, before 1976, Manorcare owned the Central Scientific business, between 1976 and 1979 CSC, Scientific owned the business, and after 1979 VWR was the owner.

The Yelin Action ultimately included claims against Manorcare and VWR, but not against CSC Scientific. See Def.’s 56.1 Statement ¶¶ 29-30. In June 2007, VWR filed a third-party claim again CSC Scientific, for contractual indemnification under the CSC-VWR Agreement, for any losses it might incur in the Yelin Action. Def.’s 56.1 Statement ¶¶ 32-33. Under the CSC-VWR Agreement, CSC Scientific promised to “indemnify, defend, and hold [VWR] harmless” for “any and all obligations, liabilities, damages, claims and expenses arising out of or related to ownership of the [domestic education] assets4 prior to [April 17, 1979],” and “all [related] suits, actions, proceedings, claims, and assessments against [VWR].” Def.’s 56.1 Statement ¶ 21; CSC-VWR Agreement ¶¶ 18(a), (c).

CSC Scientific moved for summary judgment in the Yelin Action on VWR’s third-party claims. The State Court granted CSC Scientific’s motion for summary judgment, in part. In doing so, the Court held:

summary judgment with respect to the claim for contractual indemnification is granted to the extent that it is determined that the period of contractual liability is limited, pursuant to the [CSC-VWR Agreement], to the CSC [Scientific’s] products, if any, that were manufactured, distributed, or supplied containing asbestos to [Yelin’s] business during the period August 31, 1976 to April 1, 1979. CSC [Scientific] did not assume liability for the products of its predecessor prior to 1976.

Order, Yelin v. Amchem. Prods. Inc., Index No. 1578-05 (Sup.Ct. Westchester Co. June 30, 2008), Lee Decl., Ex. H (the “State Court Order”). In other words, the Court held that CSC Scientific’s contractual liability to VWR was limited to any asbestos-containing products supplied to Yelin’s business during the period August 31, 1976 to April 1, 1979.5 This period coincides with CSC Scientific’s ownership of the Central Scientific business’s domestic education assets.

In October 2008, both Manorcare and VWR settled with the plaintiff in the underlying Yelin Action. Def.’s 56.1 Statement ¶ 39. Subsequently, CSC Scientific and VWR settled VWR’s third-party contractual indemnification and defense costs claims. See Settlement Agreements dated October 23, 2008 and April 16, 2009 (collectively, the “CSC-VWR Settlement”), Def.’s 56.1 Statement ¶ 40.6

On October 28, 2008, CSC Scientific commenced this action against Manorcare to recover amounts paid by CSC Scientific to VWR under the CSC-VWR Settlement, [372]*372seeking: (1) contractual indemnification under the Manorcare-CSC Agreement, (2) common law indemnification, and (3) damages from breach of the Manorcare-CSC Agreement. See CSC-VWR Agreement ¶¶ 18(a), 18(c); see also Pi’s Compl. ¶¶ 54-57, 60, 63.7

II. Standard of Review

A party is entitled to summary judgment if “there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). A genuine issue of material fact exists if admissible evidence has been submitted that could enable a reasonable jury to decide in the nonmoving party’s favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Traditionally, “ ‘in a contract suit, summary judgment may be granted only where the language of the contract is unambiguous.’ ” Chock Full O’Nuts Corp. v. Tetley, Inc., 152 F.3d 202, 204 (2d Cir.1998) (quoting Nowak v. Ironworkers Local 6 Pension Fund, 81 F.3d 1182, 1192 (2d Cir.1996)). Even when ambiguities exist, however, summary judgment is appropriate if the moving party would prevail under any reasonable interpretation of the contract. See id.

III. CSC Scientific’s Claims Are Not for Contribution and Are Not Barred by New York Statute

As a threshold issue, the court must determine whether CSC Scientific’s claims are for indemnification or for contribution because New York General Obligations Law § 15 — 108(b) bars all claims for contribution by or against a settling tortfeasor. A settling tortfeasor may, however, sue or be sued for indemnification. See Rosado v. Proctor & Schwartz, Inc., 66 N.Y.2d 21, 494 N.Y.S.2d 851, 484 N.E.2d 1354, 1356 (1985) (“In order to remove a disincentive to settlement, the Legislature amended General Obligations Law § 15-108 to provide that a settling tort-feasor can neither obtain, nor be liable for, a contribution claim”); McDermott v. City of New York, 50 N.Y.2d 211, 428 N.Y.S.2d 643, 406 N.E.2d 460

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Bluebook (online)
867 F. Supp. 2d 368, 2011 U.S. Dist. LEXIS 110654, 2011 WL 4495332, Counsel Stack Legal Research, https://law.counselstack.com/opinion/csc-scientific-co-v-manorcare-health-services-inc-nysd-2011.