Asset Group Inc v. Corrugated Erectors Inc et al

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF OKLAHOMA
ASSET GROUP, INC., 	)
)
Plaintiff/Counterclaim Defendant, 	)
)
v. 	) 	Case No. CIV-14-435-SLP
)
CORRUGATED ERECTORS, INC., 	)
)
Defendant/Counterclaimant, 	)
)
and 	)
)
TRAVELERS CASUALTY AND 	)
SURETY COMPANY, 	)
)
Defendant. 	)
CORRUGATED ERECTORS, INC., 	)
)
Third-Party Plaintiff, 	)
)
v. 	)
)
GRAVITY-RATTERMAN, LLC, 	)
NATIONAL TRUST INSURANCE 	)
COMPANY, 	)
PHILADELPHIA INDEMNITY 	)
INSURANCE COMPANY, and 	)
GREAT AMERICAN INSURANCE 	)
COMPANY, 	)
)
Third-Party Defendants. 	)
O R D E R
Before the Court is the Joint Motion for Entry of Consent Judgment and Brief in
Support [Doc. No. 465], filed on behalf of Plaintiff/Counterclaim Defendant Asset Group,
Inc. and Defendant/Counterclaimant/Third-Party Plaintiff Corrugated Erectors, Inc. Third-
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Party Defendant Gravity-Ratterman, LLC filed a Response in Opposition [Doc. No. 469],
and the Court ordered additional briefing from the parties on the matter. 	See [Doc. No.
473]. The parties timely submitted the requested briefing. See [Docs. No. 474, 475, 476,
477, 478, 479, 481, 484].
When presented with a proposed consent judgment, district courts must typically
approve or deny the agreement “as a whole.” United States v. State of Colo., 937 F.2d 505,
509 (10th Cir. 1991) (quoting Officers for Justice v. Civil Serv. Comm’n, 688 F.2d 615,
630 (9th Cir.1982)). Approval will “place[] the power of the court behind the compromise
struck by the parties.” Id. Before taking this step, therefore, the Court must first “ensure
that the agreement is not illegal, a product of collusion, or against the public interest,” and
that it “is fair, adequate, and reasonable.” Id.
Based on the briefing submitted by the parties, the Court is not satisfied the proposed
agreement is fair to Gravity, which vehemently opposes the Motion and did not participate
in the relevant negotiations. 	See [Doc. No. 484] at 5. 	Asset and Corrugated argue that
Gravity repeatedly declined to tender a defense to Corrugated. 	This declination, they
contend, means “Gravity is bound by the liability determination in the Consent Judgment.”1
[Doc. No. 475] at 4. But Asset and Corrugated’s argument appears to put the cart before
the horse. 	They rely primarily on cases that analyze contractual indemnification
obligations after a judgment has been entered—whether by settlement, consent agreement,
1 Asset and Corrugated’s argument relies primarily on Okla. Stat. tit. 15, § 427. Gravity disputes
their analysis, arguing that Okla. Stat. tit. 15, § 221 limits the bounds of the indemnity agreement
in this case. The Court finds it unnecessary to address these arguments at this time.
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or verdict. 	See, e.g., Chicago, R.I. & P. R. Co. v. Dobry Flour Mills, 211 F.2d 785, 788
(10th 	Cir. 	1954) 	(analyzing 	indemnity 	provision 	after 	indemnitee 	settled 	claim);
Whitehorse v. Johnson, 156 P.3d 41, 47 (Okla. 2007) (considering recovery of attorneys’
fees under earlier, valid consent judgment); Callaway v. Wiltel Commc’ns, LLC, No. 06-
CV-0579-CVE-PJC, 2007 WL 2902878, at *1 (N.D. Okla. Oct. 2, 2007) (analyzing, on
reconsideration of summary judgment ruling, indemnification provisions in light of earlier
settlement agreement). 	In contrast, Asset and Corrugated attempt to use Gravity’s
declination and the indemnity provision as the foundation for the Court to enter their
proposed judgment, essentially flipping the equation. 	They have not provided sufficient
authority to demonstrate that entry of the proposed judgment is equitable to Gravity under
these circumstances.
Additionally, it is not clear to the Court that Asset and Corrugated’s request is
procedurally proper. Although they thoroughly brief Oklahoma substantive law related to
the enforcement of indemnity provisions, Asset and Corrugated give short shrift to the
federal procedural law which would allow the result they seek here. See F.T.C. v. Am. Ent.
Distributors, Inc., 433 F. App’x 816, 817 (11th Cir. 2011) (“[W]hether the settlement
agreement was a valid contract is determined by the substantive law of contracts of the
forum state. But, whether a settlement agreement, tested under state law, has been accepted
by a federal court and properly incorporated into a valid and enforceable judgment is purely
a question of federal procedural law.”). 	Asset and Corrugated concede the proposed
consent judgment would not resolve all of the issues in this matter, see [Doc. No. 475] at
9–10, yet they do not analyze the basis for the Court to enter a final judgment that will not
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resolve the entire case. See Rufo v. Inmates of Suffolk Cnty. Jail, 502 U.S. 367, 391 (1992)
(“[A] consent decree is a final judgment . . . .”); Fed. R. Civ. P. 54(b) (“When an action
presents more than one claim for relief . . . or when multiple parties are involved, the court
may direct entry of a final judgment as to one or more, but fewer than all, claims or parties
only if the court expressly determines that there is no just reason for delay. . . .” (emphasis
added)). 	Nor do they address the fairness, reasonableness, or adequacy of the proposed
consent judgment. See State of Colo., 937 F.2d at 509. If the parties choose to refile their
motion, their briefing should fully analyze the issues identified herein.
IT IS THEREFORE ORDERED that Joint Motion for Entry of Consent Judgment
and Brief in Support [Doc. No. 465] is DENIED without prejudice to refiling.
IT IS SO ORDERED this 1 st day of November, 2023.
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