Judge Miriam Goldman Cedarbaum
Tredegar bought Exxon Mobil’s film business and a Pennsylvania plant, under a 1999 asset purchase agreement. Plant worker Leinheiser was hurt in 2007. In 2009, he sued Exxon and others for strict liability and breach of warranty. Tredegar declined to indemnify Exxon. Exxon’s codefendants settled in 2011. Exxon ultimately settled for $250,000. The court only partly dismissed Exxon’s claims that Tredegar breached the agreement by not indemnifying its settlement of Leinheiser’s suit. Reading provisions as to Tredegar’s “assumed liabilities” and Exxon’s “retained liabilities” in conjunction with an “indemnification by [Tredegar]” clause, the court, informed by Haynes v. Kleinewefers & Lembo, found it ambiguous whether Exxon’s settlement was a retained or assumed liability. As it was not the “unmistakable intent” of the parties that the settlement be treated as an assumed liability, Exxon was not entitled to indemnification. However, the court ruled that as Tredegar’s refusals plausibly affected Exxon’s negotiations with Leinheiser and the settlement amount, Exxon’s claims that Tredegar breached its duty to cooperate and to provide reasonable access to records and employees survived dismissal.
