United States District Court, D. North Dakota
ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT RE
MUREX'S THIRD-PARTY COMPLAINT AGAINST WISCO,
CHARLES S. MILLER, JR., MAGISTRATE JUDGE UNITED STATES
action, plaintiff Adam Peterson (“Peterson”) is
suing to recover damages for an injury he sustained on April
15, 2012, while working as a derrick hand for third-party
defendant WISCO, Inc. At the time of the accident, WISCO,
Inc. was doing rehabilitative work on an oil well operated by
defendant and third-plaintiff Murex Petroleum Corporation
(“Murex”). Specifically, the work on the day of
the accident was rod removal. Plaintiff was injured when his
arm became entangled in the rods while he was in a basket up
in the derrick.
addition to contracting with WISCO, Inc. to perform the
rehabilitative work, Murex engaged the services of two
companies who each provided a person to represent Murex at
the wellsite with respect to the work being performed by
WISCO, Inc. In oilfield parlance, the onsite representative
for Murex is referred to as the “company man.”
One of the firms that Murex engaged to provide it with a
company man was defendant Phoenix Operating Company
(“Phoenix”). The individual retained by Phoenix
for this purpose was defendant Earl Britzenhoff
(“Britzenhoff”). The other firm engaged by Murex
was defendant Stokes and Spiehler (“Stokes”). The
individual that Stokes retained to be Murex's company man
was defendant Micky Peck (“Peck”).
has alleged in the complaint that one or more of the
defendants are at fault for his injuries (either directly as
result of their own conduct or vicariously) on account of his
not having a safe place to work and being directed to follow
unsafe working practices. Among other things, plaintiff
contends Murex's company man directed that work on the
job should continue despite it being too windy for safe
operation and instructed that he perform his work in an
has not sued his employer WISCO, Inc. presumably because of
the immunity provided by North Dakota workers'
compensation law. While plaintiff has not sued WISCO, Inc.,
Murex has, contending in its third-party complaint that WISCO
Inc. is required to provide Murex with a defense and
indemnity from the claims being made by Peterson.
contends that its right to a defense and indemnity by WISCO,
Inc. arises out of a master services agreement entered into
between Murex and Williston Industrial Supply Company
(herein“Williston Industrial Supply” or
“WISCO”) dated February 8, 2010
(“Murex-WISCO MSA”) and, more specifically,
Section 7, which reads as follows:
INSURANCE AND INDEMNITY:
7.1 Contractor shall at all times while operations are
conducted hereunder carry insurance of types and in minimum
amounts as shown on the attached Exhibit “A, ”
“Minimum Insurance Requirements” with insurers
satisfactory to Murex, unless an officer of Murex Petroleum
Corporation has consented to Contractor's being a
self-insurer as to any one or more the risks as to which
coverage is required in such Certificate of Insurance. Within
ten (10) days after signing this agreement or before
performing any work and/or Services hereunder, whichever is
sooner, Contractor will furnish evidence to Murex of the
required coverage on a Certificate of Insurance.
7.2 Contractor agrees to protect, defend, and indemnify and
save Murex harmless from and against liability, loss, damage
or expense by reason of any suits, claims, demands, judgments
and causes of action caused by Contractor, its employees,
agents or any subcontractor, arising out of or in consequence
of the performance of this agreement or any Service Agreement
entered into pursuant to the terms hereof, except that in no
instance shall Contractor be held responsible for reservoir
loss or damage, nor for any liability, claim, demand, or
cause of action attributable solely to the negligence of
Murex. This provision requires Contractor to protect, defend
and indemnify and save Murex harmless for concurrent
negligence, including that part, if any, of such concurrent
negligence attributable to Murex.
This indemnity agreement by Contractor shall be insured by
Contractor with insurers and in amounts satisfactory to
Murex, except as to those risks as to which an officer of
Murex has consented to Contractor's being a self-insurer.
(Doc. No. 26-1, pp. 1-2).
to what follows, the owner of WISCO, James R. Scheele,
decided in 2011 to sell the company to Omni Energy Services
(“Omni”). The sale was in the form of a purchase
of assets, rather than a stock sale. To purchase the assets
Omni or one of its subsidiaries caused a new corporation to
be formed-defendant WISCO, Inc. The Asset Purchase Agreement
(“WPA”) dated April 14, 2011, was between
Williston Industrial Supply and Scheele as the sellers and
WISCO, Inc., as the purchaser. (Doc. No. 26-10).
included in the asset purchase was all of WISCO's
existing contracts along with an assumption of liabilities.
(Id., pp. 4-5, 17-18, 22, 43). One of the schedules
to the WPA listed the customers with whom WISCO had existing
master service agreements. Murex was one of the listed
customers. (Id., p.124). Also, in another schedule,
Murex was listed as being WISCO's largest customer in the
years 2009 and 2010. (Id., p. 134).
to the asset sale, Williston Industrial Supply often referred
to itself as WISCO. In fact, it did so in the Murex-WISCO
MSA, which provided in relevant part:
This is an agreement made this 8th day of February 2010
between MUREX PETROLEUM CORPORATION hereinafter called
“Murex” and WISCO, herein after called
“Contractor, ” . . . .
(Doc. No. 26-1, p. 1).
Inc. was aware that Williston Industrial Supply was using
WISCO as another name for the company at the time of the
asset purchase. In fact, WISCO, Inc. actually purchased
Williston Industrial Supply's right to use the name or
mark “WISCO” as well as the right to use the full
name of “Williston Industrial Supply
Corporation.” (Doc. No. 26-10, p. 5).
the asset purchase and continuing through the date of the
accident in this case, there are numerous instances in which
WISCO, Inc. used the name WISCO or Williston Industrial
Supply Corporation to refer to it operations, including
documents sent to or exchanged with Murex. (Doc. Nos. 26-15,
26-47, 26-48, 26-49). As set forth above, this was WISCO,
Inc.'s right. However, for the reasons discussed later,
this might very well have consequences with respect to WISCO,
Inc.'s contention that it was not bound by the
Murex-WISCO MSA at the time of the accident giving rise to
Peterson's claims in this case.
the court now are cross-motions for summary judgment with
respect to Murex's third-party claims against WISCO, Inc.
This is not the first case to address whether Murex is
entitled to a defense and indemnity pursuant to the
Murex-WISCO MSA after the sale of assets to WISCO, Inc. There
is currently pending in state court a personal injury case
brought by another WISCO employee, Robert Todd Simmons, for
injuries he sustained on October 26, 2011, while working at a
Murex wellsite (“Simmons state action”). In that
case, the state court ruled on summary judgment (1) that
WISCO, Inc. was bound by the terms of the Murex-WISCO MSA as
of the date of the accident in that case, which postdated the
sale of the assets, and (2) that Murex is entitled to an
immediate defense by WISCO, Inc. with respect to
plaintiff's claims against Murex. (Doc. Nos. 26-26,
26-28, 26-29). The decision of the state district court,
however, is not yet final. According to the state court
docket, trial is scheduled to commence on January 6, 2020.
court is well familiar with the law governing motions for
summary judgment as reflected in Anderson v. Liberty
Lobby, Inc., 477 U.S. 242 (1986) and Fed.R.Civ.P. 56.