Opinion ID: 1378988
Heading Depth: 2
Heading Rank: 2

Heading: Present Contract Action

Text: After the bankruptcy court denied NCC's motion, NCC filed this lawsuit in district court seeking to enforce the alleged settlement agreement against TSF and Hoich. The parties also continued attempts to negotiate a new settlement in the bankruptcy court. The district court repeatedly stayed the contract action to allow negotiations to continue in bankruptcy. During this time, many of TSE's assets were sold, and several secured creditors and priority administrative expenses were paid from the bankruptcy estate. On June 12, 2006, NCC and the Trustee reached a settlement agreement as to NCC's claim for construction costs. The bankruptcy court granted the Trustee's motion to approve the settlement agreement, but by that time, the district court had lifted the stay in the present action. As a result, the bankruptcy court was unable to enforce the settlement agreement formed by NCC and the Trustee. On August 1, 2007, this contract action proceeded to trial. The district court issued an opinion and order on December 27, 2007, holding the original settlement agreement, read into the bankruptcy court record on June 21, 2004, was a binding and enforceable agreement. The district court further found both TSF and Hoich were bound by the agreement, and both TSF and Hoich breached the agreement when they failed to perform, making them jointly and severally liable in the amount of $2.5 million, plus prejudgment interest. The award was later reduced to $2,025,000, plus interest, pursuant to a stipulation NCC previously had made. The district court denied NCC's request for attorney fees. On February 5, 2008, TSF and Hoich filed this consolidated appeal challenging the district court's judgment in favor of NCC. NCC filed a cross-appeal challenging the denial of attorney fees. On November 12, 2008, counsel for TSF, Hoich, and NCC appeared for oral argument before our court. TSF later filed bankruptcy and all proceedings were stayed as to the issues raised by TSF in its appeal and by NCC in its cross-appeal. The stay did not extend to Hoich's appeal. On March 24, 2009, this court issued an opinion resolving all issues raised by Hoich in his appeal. See Hoich, 560 F.3d at 780. We held, among other things, that the district court erred in finding Hoich had personally guaranteed, or Hoich was a party to, the alleged June 21, 2004 settlement agreement. Id. at 793, 796. TSF's Trustee filed a motion with the bankruptcy court seeking to lift the stay as to the litigation pending between TSF and NCC. On September 11, 2009, the bankruptcy court granted the motion, and our court was notified the stay was lifted on September 15, 2009. On September 30, 2009, this court severed Hoich's appeal from the remaining consolidated cases. On that same date, we dismissed, as moot, the claims against Hoich in NCC's cross-appeal. The remaining matters for our court to consider are TSF's claims against NCC in case number 08-1288, and NCC's claim against TSF in case number 08-1394. TSF argues the district court erred when the court (1) denied TSF's motion for recusal and disqualification, (2) denied TSF's motion to dismiss on the basis of issue preclusion, (3) concluded a binding agreement had been formed between TSF and NCC, (4) found the agreement was enforceable, and (5) improperly calculated damages. NCC cross-appeals, contending the district court abused its discretion by denying NCC reasonable attorney fees.