DEFENDANTS' MOTION FOR ENTRY OF JUDGMENT
JOAN H. LEFKOW, Judge.
NOW COMES Defendants, Italia Foods, Inc. and Robert Hinman, and move this Court for entry of judgment. In support of their motion, Italia and Hinman state as follows:
1. As the Court has noted in its various orders, this is an insurance coverage action for indemnification of a classwide judgment based on five fax blasts sent by Defendant M & M Rental Center, Inc. ("M & M").
2. The fax blasts were sent on (1) June 24, 2002 (Fax #1); (2) September 15, 2003 (Fax #2); (3) November 5, 2003 (Fax #3); (4) October 29, 2004 (Fax #4) and June 23, 2005 (Fax #5).
3. The faxing fell during the policies of three different insurers who issued general liability insurance policies to M & M.
4. Specifically, Faxes #1-3 fell during the periods of two consecutive policies issued by Fire and Casualty Insurance Company of Connecticut, whose successor in interest is Security Insurance Company of Hartford ("Security"). Fax #4 fell during the period of the policy issued by Maxum Indemnity Company ("Maxum"). Fax #5 fell during the period of the policy issued by First Specialty Insurance Company ("First Specialty").
5. As the Court noted in its October 31, 2013 Order (Dkt. 428), the Underlying Judgment apportioned M & M's damages by fax. Specifically, the Underlying Judgment assessed $685,350 to fax # 1; $643,200 to fax # 2; $626,100 to fax # 3; $1,972,000 to fax # 4; and $1,890,500 to fax # 5. The Underlying Judgment also provided that "[p]ost-judgment interest shall accrue from the date of entry of this Judgment Order," which was October 6, 2009. (Underlying Judgment, attached as Exhibit A, at ¶ P).
6. The Court ruled on January 31, 2012, that First Specialty had no duty to defend or indemnify its portion of the underlying judgment (the $1,890,500 plus interest for Fax #5) (Dkt. 395). In that Order, the Court held that both Security and Maxum had a duty to defend M & M in the Underlying Action, and reserved the question of whether they must indemnify M & M for the Underlying Judgment.
7. The Court further ruled in the January 31, 2012 Order that Maxum and Security must reimburse First Specialty its defense costs incurred in the Underlying Action. The Court found that this sum was $576,207.60 and directed Security and Maxum to reach an agreement as to the apportionment of that sum.
8. The Court ruled on October 31, 2013, that both Security and Maxum have a duty to indemnify M & M for the portions of the Underlying Judgment within their respective policy periods. (Dkt. 428).
9. As noted above, Security is responsible for Faxes #1-3 and Maxum is responsible for Fax #4. Therefore, $1,954,650 plus interest on that amount is attributable to Security and $1,972,000 plus interest is attributable to Maxum.
10. The week preceding the October 6, 2009, Underlying Judgment, the one year constant maturity treasury interest rate was 0.39 percent. See http://www.federalreserve.gov/releases/h15/20091005/. This is the applicable postjudgment interest rate on the Underlying Judgment. See 28 U.S.C. § 1961.
11. The postjudgment interest on the portion of the Underlying Judgment attributable to Security is $31,286.18 (1498 days (from 10/6/09 to 11/12/13) * $1,954,650 * 0.0039 / 365).
12. The postjudgment interest on the portion of the Underlying Judgment attributable to Maxum is $31,563.89 (1498 days * $1,972,000 * 0.0039 / 365).
13. Therefore, pursuant to the October 31, 2013 Order, Hinman and Italia respectfully request that the Court enter a final judgment order providing that:
(a) Judgment is entered against Security and in favor of Hinman, Italia, and the Underlying Class in the amount of $1,985,936.18 in partial satisfaction of the Underlying Judgment;
(b) Judgment is entered against Maxum and in favor of Hinman, Italia, and the Underlying Class in the amount of $2,003,563.89 in partial satisfaction of the Underlying Judgment;
(c) Judgment is entered in favor of First Specialty and against Defendants;
(d) Judgment is entered in favor of First Specialty and against Maxum and Security, jointly and severally, in the amount of $576,207.60 as reimbursement for defense costs incurred by First Specialty in the Underlying Action; and
(e) This is a final and appealable order resolving all claims as to all parties.
A proposed Judgment Order is attached as Exhibit B.
WHEREFORE, for the foregoing reasons, Hinman and Italia respectfully request that this Court enter a final judgment order consistent with the attached proposed order, and for such further relief as the Court deems necessary and proper.
EXHIBIT A
IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
ROBERT HINMAN and ITALIA FOODS, INC.,
individually and as the representatives of a class
of similarly-situated persons,
Plaintiffs, Case No. 06 C 1156
v. Honorable Elaine E. Bucklo
M and M RENTAL CENTER, INC.,
Defendant.
FINAL APPROVAL OF SETTLEMENT AGREEMENT AND JUDGMENT
WHEREAS, Plaintiffs (on behalf of themselves and the Class) and Defendant filed an executed Settlement Agreement (the "Agreement") with the Court on June 22, 2009; and
WHEREAS, the Court, on June 26, 2009, entered an Order Preliminarily Approving the Class Action Settlement, and Approving the Class Action Settlement Notice (the "Preliminary Approval Order"), and directed that the Notice of Proposed Settlement be distributed to Class Members, and scheduled a hearing to be held on September 10, 2009, to determine whether the Settlement should be approved as fair, reasonable, and adequate; and
WHEREAS, Plaintiffs have demonstrated to the Court that such Notice of Proposed Settlement was distributed in accordance with the terms of the Preliminary Approval Order; and
WHEREAS, in accordance with the Notice of Proposed Settlement disseminated to the Class Members, a hearing was held on September 10, 2009, at which all interested persons were given an opportunity to be heard;
NOW, THEREFORE, the Court, having read and considered all submissions made in connection with the Agreement, including statements in open court, finds and concludes as follows:
1. The Complaint in this action alleged that Defendant faxed unsolicited advertisements to Plaintiffs and the other members of a putative class. The Complaint alleged Defendant's practice violated federal law and caused damages to Plaintiffs and the other members of a putative class.
2. On April 7, 2008, the Court certified the following Class:
All persons who, on or after four years prior to the filing of this action, were sent, without permission, telephone facsimile messages of material advertising the commercial availability of any property, goods on services by or on behalf of Defendant.
The Court hereby affirms this definition of the Class for purposes of this Final Judgment.
3. The Court certified the Class as defined above, and, in so doing, found that the requirements of Federal Rule of Civil Procedure Rule 23(b)(3) have been met, in particular because: (1) the Class is so numerous that joinder of all members is impracticable; (2) there are common questions of fact or law that predominate over any questions affecting only individual members; (3) Plaintiff and its attorneys will fairly and adequately protect the interests of the Class; and (4) a class action is an appropriate method for the fair and efficient settlement of this controversy.
4. Plaintiffs and Defendant executed the Agreement and filed it with the Court. The Agreement provides for the settlement of this action on behalf of Plaintiffs and the Class, subject to the Court's approval. The Court scheduled a hearing to consider approval of the Agreement, and directed that notice of the Agreement and of this hearing be disseminated to the Class in accordance with the terms of the Preliminary Approval Order.
5. In accordance with the terms of both the Agreement and the Preliminary Approval Order, Plaintiffs caused the Notice of Proposed Settlement to be disseminated, informing potential Class Members of the pendency of this Action and of the terms of the settlement, and of their opportunity to request exclusion from the Class or to object to the terms of the settlement. Plaintiffs' attorneys confirmed to the Court on September 8, 2009 (by filing the Declaration of Andrew Barnett) that the dissemination of the Notice of Proposed Settlement had occurred in accordance with the Preliminary Approval Order.
6. The Court hereby finds that the Notice of Proposed Settlement disseminated to the Class Members in accordance with the terms of the Preliminary Approval Order constituted the best notice practicable under the circumstances. The Declaration of Andrew Barnett confirming dissemination of the Notice of Proposed Settlement filed with this Court demonstrates that this Court's Preliminary Approval Order with respect to dissemination of the Notice of Proposed Settlement was complied with, and that the best notice practicable under the circumstances was in fact given, and constituted valid, due, and sufficient notice to Class Members.
7. Plaintiffs and Defendant have applied to the Court for final approval of the terms of the Agreement and for the entry of this Final Approval Order. Pursuant to the Notice Proposed Settlement, and upon notice to all parties, a hearing was held before this Court on September 10, 2009, to determine whether the Court should approve the Agreement as a fair, reasonable, and adequate compromise of this litigation, and whether the Final Approval Order, without prejudice to the enforcement of the final judgment entered, should be entered.
8. The Court hereby finds that the Agreement is the result of good faith arm's-length negotiations by the parties thereto, and that it will further the interests of justice. The Settlement Agreement is hereby incorporated into and adopted as part of this Order.
9. Pursuant to the Agreement, and based on the parties' submissions, the Court hereby vacates the Memorandum Opinion and Order entered on January 27, 2009 (Docket #192) and vacates the Judgment in a Civil Case entered on January 27, 2009 (Docket #191).
10. Additionally, based upon the evidence in the record and statements made in open court, the Court finds as follows:
a. that the settlement is made in reasonable anticipation of liability;
b. that the settlement amount was fair and reasonable;
c. that Defendant's decision to settle conformed to the standard of a prudent uninsured;
d. that the damages amount agreed to is what a reasonably prudent person in Defendant's position would have settled for on the merits of the claims in this Litigation;
e. Defendant sent more than 20,756 faxes alleged to be unsolicited advertisements as follows: (1) 4,569 on June 24, 2002; (2) 4,288 on September 15, 2003; (3) 4,174 on November 5, 2003; (4) 3,944 on October 29, 2004; and (5) 3,781 on June 23, 2005;
f. Defendant believed that it had the consent of the fax recipients when it sent the faxes;
g. Defendant does not believe that sending faxes alone is sufficient to establish liability under the TCPA;
h. Defendant did not intend to injure the fax recipients;
i. Defendant did not know that its faxes were advertisements as defined by the TCPA;
j. Defendant promptly tendered this lawsuit to First Specialty, Maxum and Security as well as several excess carriers, including RSUI Indemnity Co., for defense and indemnity; and
k. First Specialty agreed to defend this matter, but reserved its rights regarding indemnity. Maxum, Security, RSUI, and James River refused to defend or indemnify Defendant in this lawsuit.
NOW, THEREFORE, IT IS ORDERED, ADJUDGED, AND DECREED THAT:
A. The Court possesses jurisdiction over the subject matter of this Action, the Plaintiffs, the Class Members, and Defendant. The Court certifies the following class:
All persons who, on or after four years prior to the filing of this action, were sent, without permission, telephone facsimile messages of material advertising the commercial availability of any property, goods on services by or on behalf of Defendant (the "Class").
B. It is hereby determined that the Notice of Proposed Settlement, as disseminated to members of the Class in accordance with provisions of the Preliminary Approval Order, was the best notice practicable under the circumstances to all members of the Settlement Class, and is therefore finally approved as reasonable. Due and adequate notice of the pendency of this Action and of this Settlement has been provided to members of the Class, and this Court hereby finds that the notice program described in the Preliminary Approval Order and completed by Plaintiff complied fully with the requirements of due process, under Federal Rule of Civil Procedure 23, and all other applicable laws.
C. Three members of the Class filed Requests for Exclusion: (1) Corporate Resources of Illinois LTD/Nanette B. Perkins, (2) Litchfield Cavo/John F. Lemker, and (3) Imprint Enterprises/Robert L. Conti, Sr. The parties agreed that these persons have validly requested exclusion from the Class. All remaining Class Members are bound by this Final Judgment and by the Agreement and the settlement embodied therein, including the covenant not to execute provided for in the Agreement and in this Final Approval Order.
D. All provisions and terms of the Agreement are hereby found to be fair, reasonable, and adequate as to the Class Members and Plaintiffs, and all provisions and terms of the Agreement are hereby finally approved in all respects. The Agreement was made in reasonable anticipation of liability. The settlement amount is fair and reasonable. Defendant's decision to settle conforms to the standard of a prudent potentially uninsured. The agreed judgment amount is what a reasonably prudent person in Defendant's position would have settled for.
E. The Court enters judgment against Defendant in the total amount of $5,817,150.00 for violations of the TCPA, apportioned as follows: (i) $685,350.00 for the faxes sent on or about 6/24/02; (ii) $643,200.00 for the faxes sent on or about 9/15/03; (iii) $626,100.00 for the faxes sent on or about 11/05/03; (iv) $1,972,000 for the faxes sent on or about 10/29/04; and (v) $1,890,500 for the faxes sent on about 6/23/05. Regarding the faxes sent on or about 6/23/05, $1,890,500 of said judgment is to be satisfied by the $100,000.00 payment by First Specialty on behalf of Defendant in full settlement of claims arising only from faxes sent between 2/1/05 and 2/1/06. The Court orders that a trust be created to hold the $100,000.00 for the benefit of the Class until further Order of the Court. The remaining portion of the Judgment shall be satisfied only through the proceeds of Defendant's insurance policies (except those specifically excluded under the Settlement Agreement). Any recovery obtained on the Judgment shall not be disbursed except upon approval by the Court. The Court retains jurisdiction over this case for purposes of implementing this order
F. The Court hereby approves Defendant's assignment to the Class of all of Defendant's claims, rights to payment, and rights of action against every insurer covering any part of the period June 24, 2002 to June 23, 2005, except those policies specifically excluded under the Settlement Agreement. As provided in the Settlement Agreement, Defendant shall retain the right to go against Defendant's insurers for its attorney's fees, costs and expenses incurred in defense of this matter, except those policies specifically excluded under the Settlement Agreement.
G. It is hereby ordered that Plaintiffs shall each receive $7,500 from any recovery against Defendant's insurer(s), in accordance with the Agreement, as an incentive payment for its services to the Class. Each Class member, including Plaintiffs, which did not exclude itself will receive a pro rata share of the amount recovered. Such payments will be made by checks void 90 days after issuance.
H. It is hereby ordered that Plaintiff's attorneys shall receive attorneys' fees equal to 33.33% plus costs from any recovery against Defendant's insurer(s), in accordance with the Agreement.
I. It is hereby ordered that any funds received from Defendant's insurer(s) remaining after payment of all class administration costs, the incentive award to Plaintiff, the attorney's fees and costs to Plaintiff's attorneys, and all payments to the class members, shall be paid as a cy pres award to a charity or charities approved by this Court at the request of Plaintiff's attorneys.
J. On the Effective Date, any Class member who did not opt out will be forever barred and permanently enjoined from directly, indirectly, representatively or in any other capacity, filing, commencing, prosecuting, continuing, litigating, intervening in, participating in as class members or otherwise, or receiving any benefits or other relief from any other lawsuit, any other arbitration, or any other administrative, regulatory, or other proceeding against Defendant and/or any of its officers, directors, shareholders, and employees in any jurisdiction based on or relating in any way whatsoever to the claims and causes of action, or the facts or circumstances relating thereto, in or underlying the Action and/or the settled claims as defined in the Agreement; and all persons shall be forever barred and permanently enjoined from filing, commencing, or prosecuting any other lawsuit as a class action against Defendant and its officers, directors, shareholders and employees (including by seeking to amend a pending complaint to include class allegations or by seeking class certification in a pending action in any jurisdiction)on behalf of Class Members who have not timely excluded themselves from the Class if such other lawsuit is based on or related to the claims and causes of action or the facts and circumstances relating thereto, in this Action and/or the settled claims.
K. Plaintiff and each Class Member, and their heirs, executors, administrators, representatives, agents, successors and assigns, and any and all other Persons claiming through or by virtue of them, have covenanted with Defendant not to execute on the Judgment against any asset or property of any kind of Defendant, or any of its past or present officers, stockholders, directors, employees, parents, affiliates, subsidiaries or divisions, or any other successors, assigns or legal representatives thereof, but rather have agreed to pursue collection of the Judgment solely against Defendant's insurance policies and Defendant's insurer(s) only, except only First Specialty Ins. Co. and James River, whose policies are expressly excluded in the Agreement regarding faxes sent during the period February 1, 2005, through February 1, 2006. This provision does not release the judgment against Defendant to be entered herein, nor does it release the asserted claims that are the basis for the entry of the judgment or the right to enforce the judgment in favor of the Plaintiff and the Class against Defendant's insurers only, except that neither Plaintiffs nor any member of the Class may enforce the Judgment against First Specialty Insurance Corporation Policy No. IRG10494; James River Insurance Company Policy No. 00008284-0; or any other primary liability insurance policy that was originally issued to provide coverage for any portion of the period beginning 2/1/05 and ending 2/1/06.
L. The terms of the Agreement and of this Order and the accompanying Final Judgment shall be forever binding on Plaintiff and all other Class Members, as well as their heirs, executors and administrators, successors and assigns, and those terms shall have res judicata and other preclusive effect in all pending and future claims, lawsuits or other proceedings maintained by or on behalf of any such persons, to the extent those claims, lawsuits, or other proceedings involve settled Claims.
M. The Court has jurisdiction to enter this Order. Without in any way affecting the finality of this Order and the accompanying Final Judgment, the Court expressly retains continuing exclusive jurisdiction as to all matters relating to the administration, consummation, enforcement, and interpretation of the Agreement, this Order, and the final judgment contained herein and any future recovery for the class against Defendant's insurer.
N. Defendant shall cooperate fully with Plaintiff in all subsequent actions against Defendant's insurers.
O. This is a final and appealable order and there is no just reason to delay enforcement or appeal.
P. Post-judgment interest shall accrue from the date of entry of this Judgment Order.
ENTER:
Dated: 10/6/09 ______________________________
Judge
EXHIBIT B
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
MAXUM INDEMNITY COMPANY AND
SECURITY INSURANCE COMPANY OF
HARTFORD as successor in interest to
FIRE AND CASUALTY INSURANCE
COMPANY OF CONNECTICUT, Case No. 06 C 4946
Plaintiffs, Judge Joan H. Lefkow
v.
ECLIPSE MANUFACTURING CO., M & M
RENTAL CENTER, INC., ROBERT
HINMAN and ITALIA FOODS, INC.,
Defendants.
JUDGMENT ORDER
Consistent with the Court's October 31, 2013 summary judgment ruling, the Court hereby enters judgment against Plaintiffs Security Insurance Company of Hartford ("Security") and Maxum Indemnity Company ("Maxum"), and in favor of Defendants and the Class. The Court further enters judgment in favor of intervening Plaintiff First Specialty Insurance Company ("First Specialty") and against Defendants and the Class.
Specifically,
A. Judgment is entered against Security and in favor of Hinman, Italia Foods, and the Underlying Class in the amount of $1,985,936.18 (including $1,954,650 in principal and $31,286.18 in postjudgment interest) in partial satisfaction of the Underlying Judgment;
B. Judgment is entered against Maxum and in favor of Hinman, Italia Foods, and the Underlying Class in the amount of $2,003,563.89 (including $1,972,000 in principal and $31,563.89 in postjudgment interest) in partial satisfaction of the Underlying Judgment;
C. Judgment is entered in favor of First Specialty and against Defendants;
D. Judgment is entered in favor of First Specialty and against Maxum and Security, jointly and severally, in the amount of $576,207.60 as reimbursement for defense costs incurred by First Specialty in the Underlying Action; and
E. This is a final and appealable order resolving all claims as to all parties.
Security and Maxum shall pay the judgment to Hinman, Italia Foods and the Class in care of their attorneys, Phillip A. Bock of Bock & Hatch, LLC and Brian J. Wanca of Anderson + Wanca, for distribution pursuant to the Final Approval of Settlement Agreement and Judgment entered in Case No. 06 cv 1156 on October 6, 2009.
Dated: November 12, 2013 ENTER:
________________________________
Hon. Joan H. Lefkow
