FEDERAL NATIONAL MORTGAGE ASSOCIATION v. Chicago Three Holdings LLC, 2:22-cv-11884

The Court appointed Tarantino Properties, Inc. as Receiver for a multi-family property in Detroit after a prior fire loss.
The Receiver was granted exclusive control over the property’s operations and finances, including authority to approve insurance settlements with court approval.
A business interruption insurance claim related to a 2021 fire at the property resulted in a proposed settlement with Landmark Insurance Company for $103,574.
Plaintiff (Federal National Mortgage Association), the Receiver, and Landmark all agreed to the settlement; Defendant (Chicago Three Holdings) refused to sign the agreement, citing concerns over an indemnification clause.
Defendant's refusal led the Receiver to file motions seeking approval of the settlement, an order compelling Defendant to sign, a finding of contempt, and sanctions.
Defendant argued it was willing to settle under certain court-approved conditions, but could not agree to indemnity obligations.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Court approval of insurance settlement	Receiver can approve settlement with court and Plaintiff approval	Does not object to terms but objects to indemnity language	Settlement approved
Compelling Defendant to sign settlement	Defendant must execute agreement as ordered by Court	Objects to signing due to indemnity clause it cannot fulfill	Motion denied as moot; alternative order entered
Sanctions for non-cooperation	Defendant’s refusal undermines receiver’s authority, warrants fines	Non-cooperation was based on legitimate concerns, not willful disobedience	Sanctions denied

McAlpin v. Lexington 76 Auto Truck Stop, Inc., 229 F.3d 491 (6th Cir. 2000) (affirming the court’s authority to enforce its own orders)
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (1994) (court retains jurisdiction to manage proceedings and effectuate its decrees)