Sherman & Howard L.L.C. v. Peppers & Rogers Group B.V., 1:16-cv-02796

Sherman & Howard L.L.C. filed an interpleader action in 2016 to resolve conflicting instructions over a $175,000 escrow amount related to the incomplete purchase of an interest in Peppers & Rogers Group Gulf (PRG Gulf) by Amine Jabali from Peppers & Rogers Group B.V. (PRG).
Jabali and PRG entered into a Settlement Agreement in 2017, which conditioned Jabali's receipt of the escrow amount on him obtaining (1) a formal Certificate of Dissolution for PRG Gulf from the Kuwaiti Ministry of Commerce and (2) a tax clearance certificate from Kuwaiti authorities.
The Settlement Agreement required Jabali to prepare the necessary dissolution and financial documents and PRG to minimally cooperate by executing papers as needed.
The dissolution was not completed by the required deadline, with both parties blaming each other for delays related to document preparation, local counsel, accrued business debts, and changes in Kuwaiti law.
Nearly seven years later, Jabali moved to enforce the agreement, arguing that (a) suspension of PRG Gulf’s business license and (b) the running of Kuwait’s tax statute of limitations constituted substantial performance. PRG opposed, insisting these did not satisfy the contract's explicit requirements.

Issue	Jabali's Argument	PRG's Argument	Held
Whether suspension of PRG Gulf’s license equals formal dissolution	License suspension is functionally equivalent to dissolution; PRG Gulf ceased business.	Only formal dissolution and certificate protect from liability and meet the contract’s terms.	License suspension is not formal dissolution; Jabali failed to substantially perform.
Whether passage of the tax liability statute of limitations is equivalent to a tax clearance certificate	With limitations period expired, PRG Gulf is free from tax liability—equivalent to clearance.	Only official clearance insulates from all risk; statutory bar is not an equivalent substitute.	Running of limitations does not provide the same protection; substantial performance not met.
Whether non-performance should be excused due to PRG’s alleged lack of cooperation	PRG’s lack of cooperation justified any delays or misses in performance.	No excuse; Jabali’s non-performance was not caused by PRG, and argument was waived.	Argument not timely raised and would not justify awarding escrow to Jabali.
Whether PRG is entitled to the escrow by default	N/A—Jabali seeks enforcement and release; not directly argued.	PRG should receive escrow amount now.	PRG must file its own motion to claim funds; request denied in this order.

Shoels v. Klebold, 375 F.3d 1054 (10th Cir. 2004) (trial courts may summarily enforce settlement agreements in pending litigation)
United States v. McCall, 235 F.3d 1211 (10th Cir. 2000) (applying state contract law to settlement agreements in federal court)
Gates Corp. v. Bando Chem. Indus., Ltd., [citation="4 F. App'x 676"] (10th Cir. 2001) (federal courts apply state law to settlement agreements even with federal claims)
Stan Clauson Assocs. v. Coleman Bros. Const., LLC, 297 P.3d 1042 (Colo. App. 2013) (substantial performance doctrine—failure to substantially perform is material breach)
W. Distrib. Co. v. Diodosio, 841 P.2d 1053 (Colo. 1992) (materiality and substantial performance assessed in context of contract formation)