We previously reported on a case in which three children were burned as a result of a propane gas explosion. This case was settled for five million three hundred thirty-five thousand dollars with the local propane distributor. The plaintiffs and the local propane distributor had mediated and agreed upon a settlement. The national company, which had provided the propane to the local distributor, although being a defendant, had not been asked to join in the mediation process. The local distributor, as part of the original settlement, had insisted that the national distributor be released due to an indemnity agreement between those two parties.
The plaintiffs had agreed to such a settlement; however, when the national distributor was advised that they would be dismissed with prejudice and would not have to pay toward any of the settlement, they objected and stated that they would not consent to the settlement unless their attorney’s fees, which they had previously incurred, were paid. As a result of their refusal to go along with the settlement, the plaintiffs and the local distributor re-negotiated their settlement with the understanding that the local distributor would pay the $5.335 million and the plaintiffs would proceed to trial against the national distributor and that the plaintiffs would indemnify the local distributor in the event a verdict was rendered which triggered the indemnity provision.
The attorneys for Merkel & Cocke felt that the plaintiffs had theories of liability against the national distributor which were independent acts of negligence and which would not trigger the indemnity provision between the local and the national distributor. Hence, we felt that the risk of having to indemnify the local distributor was minimal.
The national distributor immediately asked the Court to continue the trial which was scheduled to begin in six weeks. We opposed this motion and the Court denied their request for a continuance. The national distributor found themselves in a position of being unprepared for trial since they had not participated in many of the depositions and had not identified any experts. The case against them was ultimately settled for the sum of $600,000.00.