BFC Gas Co. v. Gypsum Supply Co.

• Decision Date: 15 October 2014
• Docket Number: No. 13-CV-81-LRR,13-CV-81-LRR
• Parties: BFC GAS COMPANY, L.C. and BFC ELECTRIC COMPANY, L.C., Plaintiffs, v. GYPSUM SUPPLY CO. d/b/a GYPSUM SUPPLY CO. OF CEDAR RAPIDS, Defendant.
• Court: U.S. District Court — Northern District of Iowa

BFC GAS COMPANY, L.C. and BFC ELECTRIC COMPANY, L.C., Plaintiffs, v. GYPSUM SUPPLY CO. d/b/a GYPSUM SUPPLY CO. OF CEDAR RAPIDS, Defendant.

No. 13-CV-81-LRR

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF IOWA CEDAR RAPIDS DIVISION

October 15, 2014

ORDER

TABLE OF CONTENTS

I. INTRODUCTION....................................... 2

II. PROCEDURAL BACKGROUND............................. 2

III. SUBJECT MATTER JURISDICTION.......................... 3

IV. SUMMARY JUDGMENT STANDARD......................... 3

V. PLAINTIFFS' EXPERTS.................................. 4

A. Were Plaintiffs' Experts Timely Disclosed?...................4

1. Parties' arguments.............................. 6

2. Applicable law and application...................... 7

B. Were Plaintiffs' Violations Substantially Justified or Harmless?.. . . 10

1. Substantial justification.......................... 10

2. Harmlessness................................. 11

C. What Is the Appropriate Sanction?....................... 12

VI. FACTUAL BACKGROUND................................ 15

A. Defendant....................................... 15

B. Plaintiffs........................................ 15

C. Rental Relationship................................. 16

D. May 19, 2013 Storm................................. 17

E. Defendant's Storm Damage............................ 17

F. Plaintiffs' Storm Damage............................. 18

VII. ANALYSIS........................................... 18

A. Negligence Claim.................................. 18

B. Res Ipsa Loquitur Claim............................. 21

VIII. CONCLUSION........................................ 21

I. INTRODUCTION

The matter before the court is Defendant Gypsum Supply Co.'s Motion for Summary Judgment ("Motion") (docket no. 32).

II. PROCEDURAL BACKGROUND

On July 31, 2013, Plaintiffs BFC Gas Company, L.C. and BFC Electric Company, L.C. (collectively, "Plaintiffs") filed a two-count Petition ("Complaint") (docket no. 2) in the Iowa District Court for Linn County, Case No. LACV079097. In the Complaint, Plaintiffs allege that Defendant's negligence damaged its facility.¹ Specifically, Plaintiffs allege that Defendant's negligence caused parts of Defendant's facility to damage Plaintiffs' facility during a May 19, 2013 storm. On August 15, 2013, Defendant removed the action to this court on the basis of diversity jurisdiction. Notice of Removal (docket no. 1). On January 10, 2014, Defendant filed an Amended Answer (docket no. 13), denying Plaintiffs' allegations and asserting affirmative defenses. On July 29, 2014, Defendant filed the Motion. On August 19, 2014, Plaintiffs filed a Resistance (docket no. 35). On August 25, 2014, Defendant filed a Reply (docket no. 37). On September 11, 2014, Plaintiffs filed a Supplemental Resistance (docket no. 42).² On September 12, 2014, Defendant filed a Supplemental Reply (docket no. 43). Defendant requests oral argument,but the court finds that oral argument is unnecessary. The Motion is fully submitted and ready for decision.

III. SUBJECT MATTER JURISDICTION

The court has diversity jurisdiction over Plaintiffs' claims against Defendant pursuant to 28 U.S.C. § 1332(a). Plaintiffs are Iowa limited liability companies with their principal place of business in Cedar Rapids, Iowa, and therefore, both are Iowa citizens. Complaint ¶ 1. Defendant is an Illinois corporation with its principal place of business in Rockford, Illinois, and therefore, an Illinois citizen. Notice of Removal ¶ 4. The Complaint does not allege an amount in controversy, but based on statements in the Notice of Removal and the fact that Plaintiffs have not resisted the removal of this case to federal court, the court is satisfied that the amount in controversy exceeds $75,000. See Notice of Removal ¶ 4. Accordingly, there is complete diversity of the parties and the amount in controversy exceeds $75,000. Therefore, the court finds that it has diversity jurisdiction over both of Plaintiffs' claims. See 28 U.S.C. § 1332(a) ("The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between . . . citizens of different States.").

IV. SUMMARY JUDGMENT STANDARD

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "A dispute is genuine if the evidence is such that it could cause a reasonable jury to return a verdict for either party; a fact is material if its resolution affects the outcome of the case." Amini v. City of Minneapolis, 643 F.3d 1068, 1074 (8th Cir. 2011) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 252 (1986)). "[U]nsupported, self-serving allegations and denials are insufficient to create a genuine issue of material fact." Anuforo v. Comm'r of Internal Revenue, 614 F.3d 799, 807 (8thCir. 2010). "To survive a motion for summary judgment, the nonmoving party must substantiate [its] allegations with sufficient probative evidence [that] would permit a finding in [its] favor based on more than mere speculation, conjecture, or fantasy." Barber v. C1 Truck Driver Training, LLC, 656 F.3d 782, 801 (8th Cir. 2011) (second alteration in original) (quoting Putman v. Unity Health Sys., 348 F.3d 732, 733-34 (8th Cir. 2003)) (internal quotation marks omitted). If there is a genuine dispute about a material fact, the court must view the record in the light most favorable to the nonmoving party and afford it all reasonable inferences. See Ricci v. DeStefano, 557 U.S. 557, 586 (2009). However, "[w]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial." Id. at 586 (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)) (internal quotation marks omitted).

V. PLAINTIFFS' EXPERTS

Before discussing the facts of this case, viewing the evidence in the light most favorable to Plaintiffs and affording them all reasonable inferences, the court addresses whether Plaintiffs' expert opinions were timely disclosed and, if not, what, if any, sanction should be imposed.

A. Were Plaintiffs' Experts Timely Disclosed?

The following is a timeline with respect to the expert disclosures and other relevant matters:

11/26/13: Initial disclosure deadline. Scheduling Order (docket no. 8).

01/02/14: Plaintiffs' expert Sybill Ferrier of Construction Materials Testing ("CMT") inspected Defendant's facility, but Plaintiffs did not disclose an expert opinion. Fifth Declaration of Philip Burian, Defendant's Appendix ("Defendant's App'x") (docket nos. 32-2 through 32-7) at 220.

02/07/14: Plaintiffs' expert witness disclosure deadline. See Scheduling Order (docket no. 8) at 1.

04/17/14: Plaintiffs' counsel, Kathryn Barnhill, e-mailed Defendant and stated, "I intend to rely on a rebuttal expert—CMT isn't structural and I decided they won't work. So I'm waiting for your expert reports." Kathryn Barnhill E-mail, Defendant's App'x (docket no. 32-6) at 219.

04/18/14: Defendant produced reports from three experts, Partha P. Sarkar, Ph.D, Craig T. Raczynski and Dan Hicks. See Fifth Declaration of Philip Burian, Defendant's App'x (docket no. 32-6) at 220.

04/18/14: Defendant's expert witness disclosure deadline. See March 13, 2014 Order (docket no. 17).

04/24/14: Plaintiffs' counsel filed "Plaintiffs' Designation of Rebuttal Expert Witness" (docket no. 19), which designated James E. Tometich, P.E., as a witness "expected to rebut testimony by . . . [D]efendant's expert witnesses as to the causation of the damage to the Plaintiffs'[] plant and cooling towers." Id. at 1. No expert report accompanied the filing.

04/30/14: Plaintiff's expert Tometich allowed access to Defendant's property for inspection. Fifth Declaration of Philip Burian, Defendant's App'x (docket no. 32-6) at 220.

05/02/14: Plaintiffs' rebuttal expert deadline. See Scheduling Order (docket no. 8) at 1.

05/30/14: Barnhill's law license suspended for sixty days. See Iowa Supreme Court Att'y Disciplinary Bd. v. Barnhill, 847 N.W.2d 466, 470 (Iowa 2014).

07/03/14: Original discovery deadline. See Scheduling Order at 1.

07/09/14: Plaintiffs moved to reopen discovery due to a new attorney, Mark A. Critelli, appearing in this matter for Plaintiffs. Motion to Continue (docket no. 29) at 1. Plaintiffs' stated reasons for the Motion to Continue were "to allow

[Plaintiffs'] new counsel to acclimate himself with the file and issues and to accommodate . . . Defendant's discovery requests." Id. at 2. Critelli attempted to file a motion to reopen discovery on July 3, 2014, but he was advised that he first needed to be admitted to practice in the Northern District of Iowa. Id. at 1. The court extended the discovery deadline to July 22, 2014 and noted that "[t]he deadline for filing dispositive motions (August 1, 2014) will not be extended. The parties are reminded that December 15, 2014 remains a firm trial date." July 9, 2014 Order (docket no. 31) at 2.

07/17/14: Plaintiff's expert Tometich signed his expert report. Tometich Expert Opinion (docket no. 35-3) at 8. It appears that Tometich finished his expert report on June 4, 2014, id. at 1-2, but, nonetheless, it was not certified until July 17, 2014.

07/22/14: Extended discovery deadline. See July 9, 2014 Order (docket no. 31) at 2.

07/23/14: Defendant received Tometich's expert opinion under a cover memorandum by Critelli dated July 22, 2014. Fifth Declaration of Philip Burian, Defendant's App'x (docket no. 32-6) at 220.

07/29/14: Defendant filed the Motion.

08/01/14: Dispositive motions deadline. See July 9, 2014 Order (docket no. 31) at 2.

08/19/14: Plaintiffs filed Resistance and disclosed, for the first time, an expert report from Ferrier of CMT. Ferrier Affidavit (docket no. 35-2).

08/25/14: Defendant filed Reply.

09/11/14: Plaintiffs disclosed Karpiuk's expert report.

1. Parties' arguments

In...