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Philadelphia Indemnity Insurance Co. v. Five Star Restaurants, LLC

United States District Court, D. Nevada

September 30, 2019

PHILADELPHIA INDEMNITY INSURANCE COMPANY, Plaintiff
v.
FIVE STAR RESTAURANTS, LLC, et al, Defendants

          ORDER GRANTING IN PART MOTION FOR SUMMARY JUDGMENT [ECF NO. 95]

          ANDREW P. GORDON, UNITED STATES DISTRICT JUDGE.

         Plaintiff Philadelphia Indemnity Insurance Company moves for summary judgment, requesting an order that defendants Five Star Restaurants, LLC, Westbury Manor Enterprises, Inc., Vincent Scotto, and Michelina Scotto (collectively, "Defendants") are bound by the terms of the Indemnity Agreement they executed and are liable to Philadelphia for all losses it incurred in connection with that Agreement. ECF No. 95. The Defendants tacitly admit liability but oppose the amount of damages Philadelphia requests.

         The Defendants are bound by the terms of the Indemnity Agreement, but Philadelphia's fee request is too high. I will grant the motion for summary judgment in part and award a lesser amount.

         FACTUAL BACKGROUND

         The parties are familiar with the facts and procedural posture of this case so I will not repeat them here except as necessary for context. In 2016, defendant Five Star entered into a construction contract with Thomas Construction & Development, LLC, d/b/a TCD Construction ("TCD") to build out retail space at a restaurant called Tintoretto located at the Venetian Hotel & Casino. The Venetian required Five Star to obtain a bond before construction could commence.

         In connection with issuing the Bond, Philadelphia required the Defendants to execute the Indemnity Agreement. ECF No. 6-2. The Defendants promised (among other things) to hold harmless, indemnify, reimburse, and protect Philadelphia from all losses, and to provide collateral security to cover any claims. Starting in September 2016, Philadelphia began receiving claims on the Bond. Ultimately, at least three lawsuits (the "TCD lawsuit," the "QED lawsuit," and the "Moser lawsuit") were filed in Nevada state court against Philadelphia seeking recovery under the Bond. Philadelphia demanded the Defendants put up collateral as required by the Indemnity Agreement. The Defendants refused so Philadelphia filed this lawsuit to enforce the Indemnity Agreement.

         Philadelphia now seeks summary judgment confirming the Defendants' obligations under the Indemnity Agreement. Specifically, Philadelphia seeks an order that the Defendants are jointly and severally liable to indemnify and hold Philadelphia harmless from all losses incurred:

1. by its issuance of the Bond, including fees and costs incurred in the TCD lawsuit, QED lawsuit, and the Moser lawsuit;
2. to enforce the terms of the Indemnity Agreement, including fees and costs incurred in the TCD lawsuit, QED lawsuit, and the Moser lawsuit; and
3. to enforce the terms of the Indemnity Agreement, including fees and costs incurred in this lawsuit.

         Although the motion initially requested judgment only "as to liability," the parties supplemented their briefs to address Philadelphia's damages, in order to resolve this case more efficiently. Thus, Philadelphia seeks an order of liability and an award of damages.

         I ANALYSIS

         Liability under the Indemnity Agreement

         The plain language of the Indemnity Agreement renders the Defendants liable to indemnify Philadelphia and hold it harmless from any losses incurred in connection with the Bond or the Indemnity Agreement. See ECF No. 6-2 at 4, § 3. This includes attorneys' fees and costs incurred by Philadelphia in this case. Id. at 3, ยง 1(h). The Defendants admit they executed the Indemnity Agreement (ECF No. 95-1 at 8), and they do not contend that it is vague or unenforceable for any ...


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