The Indigo Group USA, Inc. v. Polo Ralph Lauren Corporation

• Court: Court of Appeals for the Ninth Circuit
• Decided: January 25, 2019
• Docket: 14-55579
• Status: Unpublished

Opinion

FILED NOT FOR PUBLICATION JAN 25 2019 UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

THE INDIGO GROUP USA, INC., a No. 14-55579 California corporation, DC No. 11-5883 MWF Plaintiff-counter- defendant-Appellant, MEMORANDUM* v.

POLO RALPH LAUREN CORPORATION, a Delaware corporation,

Defendant-counter-claimant- Appellee.

Appeal from the United States District Court for the Central District of California Michael W. Fitzgerald, District Judge, Presiding

Submitted January 7, 2019** Pasadena, California

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously finds this case suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2)(C). Before: TASHIMA and WATFORD, Circuit Judges, and ZOUHARY,*** District Judge.

Plaintiff-Appellant Indigo Group USA, Inc. (“Indigo”) appeals the district

court’s denial of Indigo’s motion for attorneys’ fees, arguing that the district court

erred when it determined that the indemnity provisions in Exhibits 2 and 9 to the

Vendor Compliance Packet (“VCP”) do not contain attorney’s fees clauses that

cover disputes between the contracting parties. We have jurisdiction pursuant to

28 U.S.C. § 1291, and we review de novo “any elements of legal analysis and

statutory interpretation underlying the district court’s attorneys’ fees decision.”

P.N. v. Seattle Sch. Dist. No. 1, 474 F.3d 1165, 1168 (9th Cir. 2007). We affirm.

We interpret the VCP under New York law, which directs that we “should

not infer a party’s intention to waive the benefit of the rule” that parties are

responsible for their own attorneys’ fees “unless the intention to do so is

unmistakably clear from the language of the promise.” Hooper Assocs., Ltd. v.

AGS Computs., Inc., 548 N.E.2d 903, 905 (N.Y. 1989) (citations omitted). “In

applying this standard of unmistakeable clarity, the courts have generally declined

to infer indemnification obligations arising from an indemnitee/indemnitor suit if

the contractual language does not expressly refer to or explicitly contemplate such

*** The Honorable Jack Zouhary, United States District Judge for the Northern District of Ohio, sitting by designation. 2 circumstances and the context does not suggest that the contracting parties were

specifically concerned with prospective litigation between themselves.” Luna v.

Am. Airlines, 769 F. Supp. 2d 231, 244 (S.D.N.Y. 2011) (construing and applying

New York law).

1. Exhibit 2 does not explicitly reference attorneys’ fees in litigation

between the parties, and its language can fairly be read as an indemnity provision

against third party claims. See, e.g., Bridgestone/Firestone, Inc. v. Recovery Credit

Servs., Inc., 98 F.3d 13, 21 (2d Cir. 1996) (holding that intraparty fees are not

indemnified where the indemnification clause is not “unmistakably clear” that it

covers attorneys’ fees in a breach-of-contract action and “may easily be read as

limited to third party actions”). Accordingly, the district court correctly ruled that

Indigo had not rebutted the “presumption against a finding of indemnification of

attorney fees in a suit between the contracting parties,” and that Indigo was

therefore not entitled to attorneys’ fees under Exhibit 2. See Krys v. Aaron (In re

Refco Sec. Litig.), 890 F. Supp. 2d 332, 341 (S.D.N.Y. 2012); Luna, 769 F. Supp.

2d at 245 (“[I]f the contracting parties could have anticipated that they would be

subject to third-party claims, courts apply a presumption against concluding that

their indemnification clause covers litigation costs incurred in the course of

resolving claims between those contracting parties.” (citations omitted)).

3 2. As with Exhibit 2, the language in Exhibit 9 does not communicate an

“unmistakably clear” intent to cover attorneys’ fees between the contracting

parties. See Hooper, 548 N.E.2d at 905. In fact, Exhibit 9 explicitly contemplates

indemnification limited to third party claims, and even then it does not cover the

type of claims at issue here because Indigo’s claims are not related to the resale or

use of merchandise. See id. (finding no intraparty fees clause where “agreement

d[id] not contain language clearly permitting plaintiff to recover from defendant

the attorney’s fees incurred in a suit against defendant” but rather was “typical of

those which contemplate reimbursement when the indemnitee is required to pay

damages on a third-party claim”). The district court correctly found that the

indemnification provision in Exhibit 9 does not extend to litigation between the

contracting parties and does not cover the type of claims at issue in this case.

• ! •

The district court correctly ruled that Indigo is not entitled to recover

attorneys’ fees under either Exhibit 2 or Exhibit 9 to the VCP.

AFFIRMED.