US Foods, Inc. v. White Oak Manor - Charlotte, Inc.

CourtDistrict Court, W.D. North Carolina
DecidedJuly 6, 2021
Docket3:19-cv-00227
StatusUnknown

This text of US Foods, Inc. v. White Oak Manor - Charlotte, Inc. (US Foods, Inc. v. White Oak Manor - Charlotte, Inc.) is published on Counsel Stack Legal Research, covering District Court, W.D. North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
US Foods, Inc. v. White Oak Manor - Charlotte, Inc., (W.D.N.C. 2021).

Opinion

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF NORTH CAROLINA CHARLOTTE DIVISION 3:19-cv-00227-RJC-DCK

US FOODS, INC., ) ) Plaintiff, ) ) v. ) ) ORDER WHITE OAK MANOR – CHARLOTTE, ) INC., and WHITE OAK MANAGEMENT, ) INC., ) ) Defendants. )

THIS MATTER comes before the Court on Plaintiff’s Motion for Summary Judgment, (Doc. No. 33), Plaintiff’s accompanying memoranda and declarations in support, (Doc. Nos. 34–37), Defendants’ Memorandum in Opposition, (Doc. No. 43), and Plaintiff’s Reply, (Doc. No. 46). The motion has been fully briefed, and argued and is ripe for adjudication. I. BACKGROUND a. Factual History Plaintiff US Foods, Inc. (“US Foods”) is a national food distributor servicing numerous industries. (Doc. No. 34 at 1). Defendants White Oak Manor-Charlotte, Inc. and White Oak Management, Inc. (collectively “White Oak”) manage several retirement communities including one in Charlotte, North Carolina at which the underlying incident in this case occurred. (Doc. No. 43 at 1). Prior to the incident at issue in this lawsuit, the parties had established a business relationship under which US Food provided food supply services to its customer White Oak. Then, on May 28, 2014, a power outage occurred at White Oak’s Charlotte

location. (Doc. No. 43-1 at 1–2). This outage necessitated Defendants’ acquisition of a temporary refrigerated trailer to preserve Defendants’ food supply for its residents. (Id.). White Oak’s Food Service Manager, Tracy Perraeult, contacted US Foods to request the temporary use of a refrigerated trailer. (Id. at 2). At approximately 2:00 p.m. that same day, US Foods delivered the refrigerated trailer to White Oak. (Id. at 2). The trailer came with an after-market removable ramp that US Food’s driver set up. (Doc. No. 35-2 at 2–4, Doc. No. 43-1 at

2, Bostic Dep. 42:18-23). Perrault inspected the refrigerated trailer for cleanliness and then signed the Use of Equipment Agreement (the “Agreement”) that governed the terms of the rental. (Doc. No. 43-1 at 2). The Agreement did not specify a rental price for the trailer. However, it did state that US Foods “makes no representation as to the condition of the Equipment and in no event shall USF [US Foods] be liable for any damage incurred . . . as a

result of the failure of the Equipment to operate properly or otherwise in accordance with Customer’s expectations.” (Doc. No. 1-2 at 2). The Agreement also included an indemnification clause, which read as follows: Customer hereby agrees at all times to indemnify, defend, and hold USF, its affiliates, directors, officers, shareholders and employees, harmless from and against any and all costs, damages, awards, causes of action, losses and fees, including but not limited to, reasonable attorneys’ fees, arising out of or in connection with any violation of this Agreement by Customer or its agents or employees, any property damage, product liability, bodily injury or death incurred as a result of Customer’s acts, omissions, possession or use of the Equipment. The indemnification obligation under this Section shall not be limited by a limitation on amount or type of damages, compensation, or benefits payable by or for Customer under worker’s or workmen’s compensation acts, disability benefit acts, or other employee benefit acts. In no event shall USF be liable for any injury or death incurred by any employee, agent or representative of Customer in connection with the acts, omissions, possession or use of the Equipment by Customer. The foregoing indemnification shall survive the expiration or early termination of this Agreement.

(Doc. No. 1-2).

The day after the delivery, Reginald Bostic (“Bostic”) – a White Oak employee – was injured while using the equipment in question. (Doc. No. 43-2 at 84–86). Bostic alleged that, as he exited the trailer with food supplies, the ramp collapsed without warning, causing him to fall and sustain injuries. (Id.). On May 12, 2016, Bostic filed suit against US Foods in the Superior Court Division, Mecklenburg County, Case Number 16-CVS-8194, for the alleged injuries he suffered while using the trailer. (Doc. No. 43-3). The case was later removed to Western District of North Carolina Federal Court as Civil Action No. 3:16-cv-00714. During the litigation, US Foods sent two letters to White Oak requesting indemnification and defense for Bostic’s lawsuit pursuant to Section 6 of the Agreement between White Oak and US Foods. (Doc. No. 36-1 at 2–3, 9–10). White Oak did not indemnify US Foods or help US Foods defend against the Bostic lawsuit. Additionally, White Oak did not participate in the mediation proceedings of the Bostic case, stating that it had no duty to indemnify or defend US Foods under these circumstances. (Doc. No. 36-2 at 4). US Foods ultimately reached a settlement with Bostic that included a payment of $490,000. (Doc. No. 36-3 at 2; Doc. No. 37-1 at 2). In its defense of the Bostic suit, US Foods incurred legal fees and costs of $379,816.08. (Ahrens Dec. at Exs. 4–8, Kupferschmid Dec. at Exs. 2–6).

Bostic also filed a workers’ compensation claim against White Oak regarding the May 29, 2014 accident. (Doc. No. 43 at 4). The claim was settled on December 20, 2017, and White Oak paid $295,876.70 in total benefits to Bostic. (Doc. No. 43-4 at 6). b. Procedural History Plaintiff US Foods filed a Complaint in this Court for Contractual Indemnity against White Oak on May 10, 2019, seeking damages in the amount US Foods paid

to Bostic, reasonable attorneys’ fees incurred by the Bostic lawsuit, reasonable attorneys’ fees attributed to this action, and pre-judgment and post-judgment interest. (Doc. No. 1). Defendants filed a Reply on June 20, 2019, which also contained Counterclaims for negligence, breach of contract, breach of express and implied warranties, and equitable indemnification. (Doc. No. 10). Following discovery, Plaintiff filed a motion for summary judgment on March

29, 2021. (Doc. No. 33). The motion seeks summary judgment on Plaintiff’s claim as well as on all four of Defendants’ counterclaims. Defendants filed a Response on May 24, 2021, after which Plaintiff filed a Reply on June 3, 2021. (Docs. Nos. 46, 48). II. MOTIONS FOR SUMMARY JUDGMENT Plaintiff moves for summary judgment on its claim and on all counterclaims. A. Standard of Review Summary judgment shall be granted “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a

matter of law.” Fed. R. Civ. P. 56(a). A factual dispute is genuine “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A fact is material only if it might affect the outcome of the suit under governing law. Id. The movant has the “initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes

demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quotation marks omitted). This “burden on the moving party may be discharged by ‘showing’—that is, pointing out to the district court—that there is an absence of evidence to support the nonmoving party’s case.” Id. at 325. Once this initial burden is met, the burden shifts to the nonmoving party who “must set forth specific facts showing that there is a genuine issue for trial.”

Anderson, 477 U.S. at 250.

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