Gould v. Dillard (In re Tomahawk Oil & Gas Mktg., LLC)
| Decision Date | 19 August 2016 |
| Docket Number | Adv. Pro. 15-01220-SAH,Case No. 14-15055-SAH |
| Parties | In re: TOMAHAWK OIL AND GAS MARKETING, LLC, Debtor. DOUGLAS GOULD, Trustee, Plaintiff, v. BENJAMIN DILLARD, TOMAHAWK GATHERING, LLC, HGM, LLC, and MUSTANG GAS PRODUCTS, LLC, Defendants. |
| Court | United States Bankruptcy Courts. Tenth Circuit. U.S. Bankruptcy Court — Western District of Oklahoma |
The following is ORDERED:
Before the Court are: (i) Trustee's Motion to Strike Affidavits Attached to Defendant Mustang Gas Products' Motion for Summary Judgment [Doc. 81], filed on August 1, 2016 (the "Motion") by plaintiff Douglas Gould, chapter 7 trustee ("Trustee") of Tomahawk Oil and Gas Marketing, LLC ("Tomahawk"); and (ii) Response and Objection of Defendant, Mustang Gas Products, LLC, to the Trustee's Motion to Strike Affidavits [Doc. 91], filed on August 15, 2016 (the "Response"), by defendant Mustang Gas Products, LLC ("Mustang").
The original complaint was filed on May 14, 2015, with an amended complaint adding Mustang as a defendant filed September 15, 2015. After the denial of a motion to dismiss, Mustang filed an answer on December 8, 2015. A scheduling order was issued on January 4, 2016, setting a September 12, 2016 trial date. Pertinent dates in the Scheduling Order include:
The reference was withdrawn for purposes of trial, so the trial date was stricken but the Scheduling Order otherwise remained in effect. By agreement, certain dates including the final witness and exhibit list, were enlarged.
Unfortunately, this adversary proceeding has not moved forward with ease. Rather, it has been an unnecessarily contentious battleground fraught with accusations by both sides of inaction and/or wrongdoing, which the Court has found surprising and disturbing. Putting the obvious ill-will aside, the issue presented by the Motion is straight forward. Both Trustee and Mustang have filed motions for summary judgment. Attached to Mustang's motion for summary judgment are:
Trustee seeks to strike both the Phipps Declaration and the Potter Declaration, to which Mustang objects.
Lobato v. Ford, 2007 WL 2593485 (D. Colo. 2007) (citing Yong-Quin Sun v. Board of Trustees, 429 F.Supp.2d 1002, 1030 (C.D. Ill. 2006), aff'd 473 F.3d 799 (7th Cir.), cert. denied, 127 S.Ct. 2941 (2007)). Rather than file a motion to strike, Trustee should have incorporated these arguments in his objection to Mustang's motion for summary judgment and in his reply to Mustang's objection to his motion for summary judgment as the Court has the ability to disregard inadmissible portions of any affidavit submitted in connection with summary judgment. Lobato, 2007 WL 2593485 (citing Allen v. Baxter Int'l Inc., 2006 WL 560608, * 1 n. 1 (N.D. Ill. 2006); City of Chanute, Kansas v. Williams Nat'l Gas Co., 743 F.Supp. 1437, 1445 n. 4 (D. Kan. 1990) (citing United States v. Alessi, 599 F.2d 513, 514-15 (2nd Cir.1979)). Given the unnecessarily litigious nature of both Trustee and Mustang, it comes as no surprise that Trustee would choose to file the Motion ratherthan incorporate the arguments in his summary judgment submissions. Nevertheless, because the Motion has been filed, the Court will address the arguments raised in the Motion and Response. In the future, however, counsel should incorporate such arguments into the summary judgment materials.
Affidavits on Summary Judgment
"At the summary judgment stage, the parties need not submit evidence in a form admissible at trial; however, the content or the substance of the evidence must be admissible." Bryant v. Farmers Ins. Exchange, 432 F.3d 1114, 1122 (quoting Hardy v. S.F. Phosphates Ltd., 185 F.3d 1076, 1082 n.5 (10th Cir. 1999)); see also Fed. R. Civ. P. 56(c)(2) (). When a movant utilizes an affidavit in support of summary judgment, such affidavit "must be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant or declarant is competent to testify on the matters stated." Fed. R. Civ. P. 56(c)(4).
A movant may only offer an expert's testimony via affidavit in support of summary judgment if the affiant previously has been designated an expert witness under Fed. R. Civ. P. 26(a)(2). Bryant, 432 F.3d at 1122 (citing Parker v. Cent. Kan. Med. Ctr., 178 F.Supp.2d 1205, 1210 (D. Kan. 2001), aff'd, 57 F. App'x 401, 404 (10th Cir. 2003)). "Otherwise, any non-expert testimony in the form of opinions or inferences must be '(a) rationally based on the perception of the witness, (b) helpful to a clear understanding of the witness's testimony or the determination of the fact in issue, and (c) not based on scientific, technical, or other specialized knowledge.'" Bryant, 432 F.3d at 1123 (quoting Fed. R. Evid. 701).
The Phipps Declaration is relatively short, containing ten paragraphs, only seven of which deal with the substance of the issues in this adversary proceeding.1 Given Phipps' role as Senior Vice President, Chief Operating Officer, General Counsel and Secretary of Mustang Fuel Corporation, the parent corporation of Mustang, and the context of the matters which he states, Phipps appears to be competent to testify about the matters discussed in the Phipps Declaration. University of Kansas v. Sinks, 565 F.Supp.2d 1216, 1227 (D. Kan. 2008). Moreover, the Phipps Declaration expressly states that it is based on personal knowledge, and there is no factual basis to suggest that it is not based on personal knowledge. Corporate officers are presumed to have personal knowledge of the acts of their corporation. Reddy v. Good Samaritan Hosp. & Health Ctr., 137 F.Supp.2d 948, 955-956 (S.D. Ohio 2000) (citing 11 James Wm. Moore et al., Moore's Federal Practice § 56.14[1][c] (3d ed. 1999)).
Moreover, "[a] corporation is entitled to state its legal positions and bring business documents into the summary judgment record via an affidavit of a corporate officer." Brown v. BKW Drywall Supply, Inc., 305 F.Supp.2d 814,822 (S.D. Ohio 2004). After all, a corporation can only speak through its officers and authorized representatives. Strategic Defense Intern., Inc. v. United States, 745 F.Supp.2d 1214, 1235 (M.D. Fla. 2010).
With respect to the non-disclosure of Phipps as a known witness or as a person involved in Mustang's condensate sales, Mustang point blank states Phipps was not involved in the condensate sales to Tomahawk so his identification was not required. While the Court is somewhat surprised that Phipps would not have been disclosed as part of the initial disclosures or in Mustang's preliminary witness list, without more evidence, the Court cannot assign any nefarious intent to his omission as Mustang could have not known his testimony...
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