Clean Harbors, Inc. v. Union Pacific Corporation, N15C-07-081 MMJ CCLD

Background

Clean Harbors sued Union Pacific (UPC) for breach of an environmental indemnity in a 1994 stock purchase agreement (SPA) related to remediation costs at a Wichita facility; the court previously granted summary judgment that Clean Harbors was entitled to indemnification under the SPA.
A jury trial resolved reasonableness of cleanup, compliance with notice provisions, and the amount owed; the jury found both parties breached but awarded Clean Harbors $9,180,445.76 and awarded UPC $0.
UPC moved for a new trial, challenging the damages verdict as against the weight of the evidence, the verdict form, and jury instructions (including substantial performance/material breach and exclusion of speculative regulator testimony).
Clean Harbors moved for attorneys’ fees and costs under the SPA’s indemnity provisions and for prejudgment interest; UPC opposed fees, arguing the SPA does not authorize recovery of fees for inter se enforcement actions.
The court denied UPC’s new-trial motion (verdict not against great weight, instructions and form proper), denied Clean Harbors’ request for attorneys’ fees (SPA limits fee recovery to certain third‑party or regulator‑directed contexts), and stayed the prejudgment interest determination until final judgment.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the jury award for reasonable cleanup costs was against the great weight of the evidence	Clean Harbors: costs and method were reasonable and supported by expert and lay testimony	UPC: Clean Harbors chose an unnecessarily expensive remedy to meet indemnity deadlines	Denied — jury faced a battle of experts; evidence did not preponderate so heavily as to make the verdict unreasonable; jury reduced requested amount by $1.5M showing consideration of UPC's points
Whether the verdict form (asked for "total reasonable cost" without explicit time period) confused the jury and produced improper damages	Clean Harbors: parties limited damages to indemnity period at trial; jury instructed accordingly	UPC: ambiguity could have led jury to include post‑2014 costs or otherwise misapply the SPA formula	Denied — instructions and parties’ arguments limited jurors to the indemnity period; isolated references to post‑2014 costs were contextualized and not confusing
Whether Jury Instruction 5 (requiring substantial performance to prove breach) misstated law or caused inconsistent verdicts	Clean Harbors: instruction correctly stated law; substantial performance need not be over‑defined	UPC: instruction insufficiently defined substantial performance/material breach and led to inconsistent findings that both parties breached	Denied — instruction was reasonably informative; courts need not give redundant material breach instruction; parties can both substantially perform and commit non‑material breaches
Whether Clean Harbors is entitled to attorneys’ fees for litigating indemnity under the SPA	Clean Harbors: indemnity clause includes attorneys’ fees and thus entitles it to fees to enforce indemnity	UPC: SPA limits fee recovery to fees incurred defending third‑party claims or complying with regulator directives, not inter se enforcement suits	Denied — SPA’s definition of "Environmental Liabilities" ties attorneys’ fees to actions "pursuant to" regulator orders or third‑party claims; enforcement suit between contracting parties falls outside those scenarios

Key Cases Cited

Storey v. Camper, 401 A.2d 458 (Del. 1979) (standard for setting aside jury verdict as against great weight of the evidence)
Delle Donne & Associates, LLP v. Millar Elevator Service Co., 840 A.2d 1244 (Del. 2004) (broad indemnity clauses may allow recovery of attorneys’ fees to enforce indemnity)
Pike Creek Chiropractic Center, P.A. v. Robinson, 637 A.2d 418 (Del. 1994) (contractual indemnification language construed to include attorneys’ fees when broadly worded)
Lorillard Tobacco Co. v. American Legacy Foundation, 903 A.2d 728 (Del. 2006) (clear contractual language is enforced according to its plain meaning)
R.T. Vanderbilt Co. Inc. v. Galliher, 98 A.3d 122 (Del. 2014) (party entitled to correct statement of law in jury instructions; standard for judging jury charge sufficiency)
Flamer v. State, 490 A.2d 104 (Del. 1984) (jury instructions must be reasonably informative and not misleading)