Mondelez International, Inc. v. Zurich American Insurance Company, Circuit Court of Illinois, Cook County
In this litigation arising out of alleged damage to the computer systems of Plaintiff Mondelez International, Inc. (“MDLZ”) from the NotPetya computer malware launched by the Russian military in 2017, MDLZ moved for summary judgment on Count II of its complaint against Zurich. MDLZ alleged in Count II that Zurich breached its promise to make an “unconditional partial payment” of $10 million to MDLZ in exchange for MDLZ’s purported agreement to refrain from immediately filing suit against Zurich to challenge its denial of coverage for damage caused by the NotPetya attack.
On summary judgment, MDLZ argued that e-mails between its employees and Zurich employees demonstrated that all of the elements of contract formation had been satisfied: Zurich had made an offer to pay $10 million; MDLZ accepted that offer; and MDLZ’s promise to refrain from immediately commencing litigation was adequate consideration to support Zurich’s alleged promise. Zurich opposed MDLZ’s motion and cross-moved for summary judgment on Count II, arguing that the e-mails showed that MDLZ had unequivocally rejected Zurich’s purported offer, because it insisted that Zurich waive its right to deny coverage for MDLZ’s claim—which Zurich was never willing to do. Accordingly, Zurich contended that what MDLZ called an acceptance of Zurich’s alleged offer was, in reality, a rejection and a counteroffer, that Zurich in turn rejected. Zurich also argued that MDLZ’s promise to refrain from immediately commencing litigation against it did not constitute adequate consideration under Illinois law.
After hearing oral argument, the court ruled from the bench denying MDLZ’s summary judgment motion, and granting Zurich’s cross-motion for summary judgment. The court recognized that MDLZ and Zurich were sophisticated parties, and opined that all MDLZ had to do for there to be a contract was accept Zurich’s purported offer with the understanding that Zurich would continue to reserve its rights under the policy. This, the court found, MDLZ never did.
Moreover, the court agreed with Zurich’s argument that there was no adequate consideration supporting Zurich’s alleged promise, holding that “[w]hile forbearance [to sue] certainly can be consideration, I don’t believe that in this case it was spelled out with any sort of sufficient terms to even objectively say it would be a reasonable period of time.” The court therefore dismissed Count II with prejudice.
Partners Philip Silverberg, Hilary Henkind, and Sanjit Shah represented Zurich.