Confidential
Settlement – $5,250Judge
Court
USDC Northern
Attorneys
Plaintiff
Paul B. Arenas
(Marron Lawyers APC)
Defendant
Gloria G. Medel
(Larson & Gaston LLP)
Clifford E. Hirsch
(Hirsch Closson APLC)
Facts
In August 1996, plaintiff Specialty Retailers purchased several truckloads of goods from California Cartage.
Specialty Retailers arranged with Orion Transportation for the shipment of the goods. Pursuant to a contract
carrier brokerage agreement, Orion arranged with defendant, American Motorist Insurance Co.Æs (AMICO)
insured, a trucking company, to physically transport the goods on behalf of Orion.
The trucking company failed to deliver some of the cargo. Specialty Retailers alleged a loss of $197,929. As a
result of the loss, Specialty Retailers was paid $192,929 by itÆs insurer, defendant St. Paul Fire and Marine
insurance company (SPFM). In addition, OrionÆs insurer paid Specialty Retailers and SPFM $100,000 for the
loss.
Thereafter, Specialty Retailers and SPFM brought suit against the trucking company for the loss and the action
which resulted in a default judgment in the amount of $233,149. Subsequently, in April 1999, the plaintiffs,
Specialty Retailers and SPFM brought suit in state court against AMICO, the trucking companyÆs insurer,
seeking to enforce the default judgment directly against AMICO.
The defendant, AMICO, removed the case to federal district court for the Northern District of California.
Settlement Discussions
The plaintiffs sought damages in excess of $233,149. Prior to early neutral evaluation, the plaintiffs offered $100,000 to settle. The defendants rejected the offer. The plaintiffs subsequently offered $20,000. The defendants offered $1,500 ($500 per trailer of goods lost). The plaintiffs offered $10,000 and the defendants increased their offer to $2,500. The plaintiffs offered $8,000 and the defendants offered to split the difference. The plaintiffs accepted the $5,250 offer and agreed to file an acknowledgment of satisfaction of judgment in the state court case against AMICOÆs insured.
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