In Days Inns Worldwide, Inc. v. 4200 Rose Hospitality LLC, 2025 WL 2450755 (D.N.J. Aug. 25, 2025), Days Inns brought claims for contractual indemnification pursuant to a license agreement, common law/equitable indemnification, and breach of a guaranty agreement against licensee 4200 Rose Hospitality and its individual guarantors.
Days Inns sought to recover from the defendants its reasonable attorneys’ fees, costs, and interest incurred in defending against eight sex trafficking lawsuits filed against Rose Hospitality and Days Inns, and fees and costs incurred by Days Inns in the current indemnity action. Days Inns filed a motion for partial summary judgment on the claims and the licensee and guarantors filed a counter motion arguing that Days Inns’ indemnity action failed as a matter of law because the indemnity provision was ambiguous and unenforceable.
At the outset, the court stated the amount of fees sought was not ripe for consideration at this stage because a proper motion for attorneys’ fees had not been filed. Therefore, the court limited its review to the validity of the license agreement, the enforceability of the indemnity provision, and the defendants’ indemnification liability. Defendants did not dispute that they voluntarily and knowingly entered the agreements, however, they argued that the indemnification provision is unenforceable because “reasonable attorneys’ fees” is not a defined term and, as a result, the entire license agreement is invalid. The court rejected their argument in its entirety, because such a finding was not supported by case law, and courts routinely uphold similar indemnification clauses. The defendants failed to point to any cases holding an indemnity provision was unenforceable because “reasonable attorneys’ fees” was not defined. Because the court found the defendants liable for contractual indemnification and breach of the guaranty, Days Inns’ claim for common law/equitable indemnification was denied. Accordingly, the court granted, in part, Days Inns’ motion and denied the defendants’ motion, and granted Days Inns permission to submit a petition for its attorneys’ fees.
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