Levy v. Versar, Inc.

• Court: U.S. District Court — Northern District of Illinois
• Writing for the Court: David Alan Bonoma, Phelan, Pope, Cahill, Devine & Quinlan, Ltd., Chicago, IL, for Versar, Inc
• Citation: Levy v. Versar, Inc., 882 F.Supp. 736 (N.D. Ill. 1995)
• Decision Date: 30 March 1995
• Docket Number: No. 92 C 4836.,92 C 4836.
• Parties: William LEVY and Harper Realty, Inc., Plaintiffs, v. VERSAR, INC., Defendant.

882 F. Supp. 736

William LEVY and Harper Realty, Inc., Plaintiffs, v. VERSAR, INC., Defendant.

No. 92 C 4836.

United States District Court, N.D. Illinois, Eastern Division.

March 30, 1995.

Arthur M. Holtzman, Donald J. Moran, and Emmanuel A. Sevastianos, Pedersen & Houpt, P.C., Chicago, IL, for William Levy and Harper Realty, Inc.

David Alan Bonoma, Phelan, Pope, Cahill, Devine & Quinlan, Ltd., Chicago, IL, for Versar, Inc.

MEMORANDUM OPINION AND ORDER

CASTILLO, District Judge.

The Plaintiffs in this case, Harper Realty, Inc. ("Harper") and its president, William Levy ("Levy"), seek to recover damages for negligent representation from Defendant Versar, Inc. ("Versar"), an environmental engineering and consulting company. Currently before the Court is Versar's motion for partial summary judgment on the issue of damages pursuant to Rule 56(b) of the Federal Rules of Civil Procedure. For the reasons stated below, Versar's motion for partial summary judgment is denied.

FACTS

The facts which follow are both material and undisputed. The Court finds that these facts are without substantial controversy and will be deemed established at trial, pursuant to Fed.R.Civ.P. 56(d). Levy is a citizen of Illinois and is the sole shareholder, president and chief executive officer of Harper, an Illinois corporation. See Def.'s Rule 12(m) Statement at ¶¶ 1-2, 6. Versar is a Delaware corporation which provides environmental engineering and consulting services. See id. at ¶ 3.

The realty (the "property") which is at the center of this dispute is located at 2901 North Clybourn Avenue in Chicago, Illinois. See id. at ¶ 7. Levy owns the beneficial interest of LaSalle Bank Trust No. 114077, which holds legal title to the property. See id. at ¶¶ 6-7. On February 14, 1989, Levy purchased the property from Jerry and Martin Schaffner (the "Schaffners") who owned the property individually and as the sole beneficiaries of Boulevard Bank Trust No. 6899. See id. at ¶¶ 8-9. After the purchase, the property was found to be contaminated. See id. at ¶ 10. Subsequently, Levy filed an action in the United States District Court for the Northern District of Illinois, LaSalle Nat'l Trust, etc. v. Jerry Schaffner et al., No. 91 C 8247, 1993 WL 499742, against the Schaffners, alleging that the Schaffners were liable for the cost of remediating the property. See id. at ¶ 11. On November 23, 1993, Judge Hart ruled, pursuant to 42 U.S.C. § 9613(g), that the Schaffners and other defendants (collectively known as the "Chicagoland defendants¹") were "liable for necessary future response costs consistent with the 1990 National Contingency Plan" at the property under 42 U.S.C. § 9607(a). LaSalle Nat'l Trust, Etc. v. Jerry Schaffner et al., No. 91 C 8247, Mem. Op. and Order at 17, 1993 WL 499742 (N.D.Ill. Nov. 23, 1993).

On June 21, 1994, Plaintiffs Levy and Harper, Defendant Versar, and the previously dismissed third party defendants stipulated to the facts which follow. The damages alleged in Case No. 91 C 8247 are identical to the alleged damages in the present case against Versar. See Stipulation for Voluntary Dismissal of Versar's Amended Third Party Compl. for Contribution (hereinafter "Stipulation") at ¶ 5. The plaintiffs in the present case² and the Chicagoland defendants executed a settlement agreement which fully resolved all issues between those parties relating to the property. See id. at ¶¶ 6, 7(b) and 7(f). The Chicagoland defendants were discharged from tort liability for their actions in connection with the property by the settlement agreement. See id. at ¶ 7(g). "Versar's potential tort liability in the instant case arises out of the same alleged injury and damages for which" the Chicagoland defendants were released. See id. at ¶ 7(h).

DISCUSSION

A. Summary Judgment Standard

Summary judgment is only proper when the record shows that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). A genuine issue of material fact exists only when "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). In making its determination "the court must view all evidence in the light most favorable to the party opposing the motion for summary judgment," Santiago v. Lane, 894 F.2d 218, 221 (7th Cir. 1990), and draw all reasonable inferences in the nonmovant's favor. Valley Liquors, Inc. v. Renfield Importers, Ltd., 822 F.2d 656, 659 (7th Cir.) cert. denied, 484 U.S. 977, 108 S.Ct. 488, 98 L.Ed.2d 486 (1987). However, "one of the principle purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses." Celotex Corp., 477 U.S. at 323-27, 106 S.Ct. at 2553-55. Thus, if the evidence is merely colorable, or is not significantly probative, summary judgment may be granted. Anderson, 477 U.S. at 249-50, 106 S.Ct. at 2510-11; Flip Side Productions, Inc. v. Jam Productions, Ltd., 843 F.2d 1024, 1032 (7th Cir.), cert. denied, 488 U.S. 909, 109 S.Ct. 261, 102 L.Ed.2d 249 (1988). Mere conclusory assertions, unsupported by specific facts, made in depositions or affidavits opposing a motion for summary judgment, are not sufficient to defeat a proper motion for summary judgment. Lujan v. National Wildlife Fed'n, 497 U.S. 871, 888, 110 S.Ct. 3177, 3188, 111 L.Ed.2d 695 (1990); see also Jones v. Merchants Nat'l Bank & Trust Co., 42 F.3d 1054, 1058 (7th Cir.1994) ("Self-serving assertions without factual support in the record will not defeat a motion for summary judgment.") Additionally, disputed facts become material only when they have the ability to affect the outcome of the suit. First Indiana Bank v. Baker, 957 F.2d 506, 508 (7th Cir.1992) (quoting Anderson, 477 U.S. at 248, 106 S.Ct. at 2510). And all affidavits and depositions presented must be based upon personal knowledge of the affiant or deponent and must set forth facts in a manner which would be admissible in evidence. See Davis v. City of Chicago, 841 F.2d 186, 188 (7th Cir.1988); Fed.R.Civ.P. 56(e). The sole function of the court's deliberations is to determine whether sufficient evidence exists to support a verdict in the nonmovant's favor. Credibility determinations, weighing evidence, and drawing reasonable inferences are jury functions, not those of a judge when deciding a motion for summary judgment. Anderson, 477 U.S. at 255, 106 S.Ct. at 2513.

B. Collateral Estoppel

"Under the judicially-developed doctrine of collateral estoppel, once a court has decided an issue of fact or law necessary to its judgment, that decision is conclusive in a subsequent suit based on a different cause of action involving a party to the prior litigation." United States v. Mendoza, 464 U.S. 154, 158, 104 S.Ct. 568, 571, 78 L.Ed.2d 379 (1984) (citing Montana v. United States, 440 U.S. 147, 153, 99 S.Ct. 970, 973, 59 L.Ed.2d 210 (1979)). The scope of collateral estoppel has been broadened in recent years by abolishing the requirement of mutuality of parties and by allowing the doctrine to be used "offensively" as well as defensively by a non-party to the prior lawsuit. Mendoza, 464 U.S. at 158-59, 104 S.Ct. at 571-72 (citing Blonder-Tongue Laboratories, Inc. v. University of Illinois Found., 402 U.S. 313, 91 S.Ct. 1434, 28 L.Ed.2d 788 (1971) and Parklane Hosiery Co. v. Shore, 439 U.S. 322, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979)).

Versar seeks to use offensive non-mutual collateral estoppel to preclude Plaintiffs from seeking damages for which the Chicagoland defendants have been found liable in prior litigation. The Seventh Circuit has articulated a four part test for collateral estoppel:

For collateral estoppel to apply, four elements must be met: 1) the issue sought to be precluded must be the same as that involved in the prior action, 2) the issue must have been actually litigated, 3) the determination of the issue must have been essential to the final judgment, and 4) the party against whom estoppel is invoked must be fully represented in the prior action.

La Preferida, Inc. v. Cerveceria Modelo, S.A., 914 F.2d 900, 905-06 (7th Cir.1990). Because collateral estoppel is an affirmative defense, Versar has the burden of demonstrating its existence.³ See id. at 906.

Versar has failed to demonstrate that the issue sought to be precluded in this action is the same as the issue involved in Case No. 91 C 8247. Versar claims that, "the issue of plaintiffs' liability for future response costs associated with the remediation of contamination at the property was actually litigated and decided on the merits in Case No. 91 C 8247." See Def.'s Mem. of L. in Supp. of Its Mot. for Partial Summ.J. on the Issue of Damages at 6. However, it was the Chicagoland defendants' liability for response costs which was decided in the prior litigation, not Versar's liability. Therefore, the issue sought to be precluded is not the same as in the prior litigation and collateral estoppel is not applicable.

C. CERCLA

Versar also claims that 42 U.S.C. § 9613(g)(2) codifies the collateral estoppel doctrine for CERCLA actions. See id. at 6. This CERCLA provision states:

In any such action described in this subsection, the court shall enter a declaratory judgment on liability for response costs or damages that will be binding on any subsequent action to recover further response costs or damages.

42 U.S.C. § 9613(g)(2). Under this provision, the ruling in Case No. 91 C 8247 that the Chicagoland defendants are liable under CERCLA for future response costs at the property is binding upon this Court. But the prior litigation did not determine Versar's liability vel non for future response costs; it established the Chicagoland defendants' liability. Therefore, this provision does not prevent Plaintiffs...