GLF Construction Corporation v. FEDCON Joint Venture et al, No. 2:2016cv13022 - Document 34 (E.D. La. 2017)
Court Description: ORDER AND REASONS denying 26 Motion for Reconsideration. Signed by Judge Sarah S. Vance on 6/20/2017. (cg)
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GLF Construction Corporation v. FEDCON Joint Venture et al Doc. 34 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA UNITED STATES OF AMERICA for the use and benefit of GLF CONSTRUCTION CORPORATION VERSUS CIVIL ACTION NO. 16-130 22 FEDCON J OINT VENTURE, ET AL. SECTION “R” (4) ORD ER AN D REASON S GLF Construction Corporation m oves the Court to reconsider its order 1 staying this case pending the com pletion of contractual dispute resolution procedures.2 For the following reasons, GLF Construction’s m otion is denied. I. BACKGROU N D This dispute arises out of a construction contract between the United States, by and through the US Arm y Corps of Engineers (USACE), and defendant FEDCON, a joint venture consisting of David Boland, Inc. and J T Construction.3 On or about October 18, 20 13, FEDCON was awarded a 1 2 3 R. Doc. 25. R. Doc. 26. R. Doc. 1 at 1-3 ¶¶ 2, 9. Dockets.Justia.com contract (the Prim e Contract) to perform all work on the “Resilient Features” project.4 The contract called for repair and raising of substandard levees along a section of the Mississippi River in Plaquem ines Parish, Louisiana.5 As required by the Prim e Contract, FEDCON executed and delivered to USACE a Miller Act paym ent bond, under which FEDCON and Western Surety bound them selves to pay the sum under the bond.6 On or about J anuary 22, 20 14, FEDCON entered into a subcontract with GLF Construction to furnish labor, m aterials, and services on the project and com plete a portion of FEDCON’s scope of work under the Prim e Contract for the agreed price of $ 10 ,517,859.50 .7 In May of 20 16, FEDCON term inated the subcontract with GLF Construction.8 On J uly 20 , 20 16, GLF Construction filed this Miller Act lawsuit alleging that FEDCON breached its subcontract with GLF Construction. 9 GLF Construction sought paym ent under the Miller Act Bond, and also brought claim s for breach of contract and unjust enrichm ent.10 On October 19, 20 16, the defendants filed a m otion to stay, arguing that GLF 4 5 6 7 8 9 10 Id. Id. Id. ¶ 10 ; R. Doc. 1-1 at 1 (Miller Act Paym ent Bond). R. Doc. 1 at 3-4 ¶ 11. Id. at 11 ¶ 35. Id. at 12 ¶ 37. Id. at 12-16. 2 Construction is bound by the term s of the subcontract with FEDCON to stay any litigation until the com pletion of the dispute resolution procedures contained in the subcontract.11 On March 7, 20 17, the Court stayed the case, finding that the subcontract between the parties contractually bound GLF Construction to stay the litigation pending the com pletion of the applicable dispute resolution procedures.12 The Court’s order adm inistratively closed the case pending the stay.13 GLF Construction now m oves the Court to reconsider its order under Federal Rule of Civil Procedure 59(e), arguing both that the Court com m itted m anifest error and that failure to lift the stay will result in m anifest injustice.14 FEDCON filed a response in opposition,15 and GLF Construction replied.16 II. LEGAL STAN D ARD A district court has considerable discretion to grant or deny a m otion under Rule 59(e). See Edw ard H. Bohlin Co. v. Banning Co., 6 F.3d 350 , 355 11 12 13 14 15 16 R. Doc. 8 -1 at 1-2. R. Doc. 25 at 6-7. Id. at 10 . R. Doc. 26 at 2-4. R. Doc. 29. R. Doc. 32. 3 (5th Cir. 1993). Reconsideration of an earlier order is an extraordinary rem edy, which should be granted sparingly. See Fields v. Pool Offshore, Inc., 1998 WL 43217, *2 (E.D. La. Mar. 19, 1998); Bardw ell v. George G. Sharp, Inc., 1995 WL 517120 , *1 (E.D. La. Aug. 30 , 1995). The Court m ust “strike the proper balance between the need for finality and the need to render a just decision on the basis of all the facts.” Edw ard H. Bohlin Co., 6 F.3d at 355. A m oving party m ust satisfy at least one of the following criteria to prevail on a Rule 59(e) m otion: (1) the m otion is necessary to correct a m anifest error of fact or law; (2) the m ovant presents newly discovered or previously unavailable evidence; (3) the m otion is necessary in order to prevent m anifest injustice; and (4) the m otion is justified by an intervening change in the controlling law. See Fidelity & Deposit Co. of Md. v. Om ni Bank, 1999 WL 970 526, *3 (E.D. La. Oct. 21, 1999); Fields, 1998 WL 43217 at *2; see also Com pass Tech., Inc. v. Tseng Labs., Inc., 71 F.3d 1125, 1130 (3d Cir. 1995) (“Rule 59 and Rule 60 (b)(2) share the sam e standard for granting relief on the basis of newly discovered evidence.”). III. D ISCU SSION GLF Construction does not base this m otion on newly discovered or previously unavailable evidence, nor does it argue that reconsideration is 4 justified by an intervening change in the controlling law. Instead, it argues that the Court com m itted m anifest error because its order staying the entire litigation, instead of only specific claim s, was based on an erroneous interpretation of the subcontract between FEDCON and GLF Construction.17 Additionally, GLF Construction argues that failure to lift the stay will subject GLF Construction to m anifest injustice.18 The Court addresses each argum ent in turn. A. Th e Stay o f th e En tire Litigatio n W a s N o t Ma n ife s t Erro r GLF Construction argues that the Court m anifestly erred by interpreting paragraphs 13 and 23 of the subcontract between itself and FEDCON to require a stay of the entire litigation instead of only certain claim s. GLF Construction’s argum ent is unavailing. As explained in the Court’s previous order, paragraph 23 of the subcontract states: If the Prim e Contract incorporated herein is one for which the Contractor has provided any bond(s) pursuant to 40 U.S.C. § 270 a, the “Miller Act,” . . . then the Subcontractor expressly agrees to stay any action or claim under this Subcontract Agreem ent against the Contractor and against the Contractor’s surety and its Paym ent Bond and Perform ance Bond pending the com plete and final resolution of the Prim e Contractor’s contractual rem edial procedure or the Subcontract Agreem ent’s m ediation procedure, as required by Paragraph 13, above.19 17 18 19 R. Doc. 26-3 at 3-7. Id. at 7-9. R. Doc. 1-2 at 10 ¶ 23. 5 Paragraph 13A, in turn, reads: The contractual rem edial procedure . . . relating to claim s for which [USACE] m ay be responsible is specifically incorporated herein by reference and m ade a part of this Subcontract Agreem ent. The term “claim ” as utilized in this paragraph shall include any request for m onetary or other relief, claim , appeal, or action arising from the subcontractor for which [USACE] has, or m ay have, responsibility. The Subcontractor shall first pursue and fully exhaust said procedure before com m encing any other action against the Contractor or its surety for any claim s it m ay have arising out of its perform ance of the Work herein. Upon the Subcontractor’s written request, the Contractor agrees to prosecute all claim s subm itted by the Subcontractor under the contractual rem edial procedure of the Prim e Contract on behalf of, and to the extent required by, the Subcontractor. . . . Final determ ination of the Subcontractor’s claim (s) by the appropriate board or court shall be final and binding on the Subcontractor and the Contractor shall have no further liability, responsibility, or obligation to the Subcontractor except as m ay be otherwise provided in this Subcontract Agreem ent.20 GLF Construction m akes the sam e argum ent it m ade in opposition to the stay: that GLF Construction’s breach of contract claim is not covered by the provision and therefore should not be stayed. This argum ent fails for the sam e reasons the Court rejected it previously. A plain reading of the text of the applicable provisions indicates that they apply to all of GLF Construction’s claim s. “Responsibility” is not qualified in the contract and 20 Id. at 7 ¶ 13. 6 there is no threshold; if USACE is even 1 percent responsible for the claim , then the provision applies. As explained in its previous order, GLF Construction’s breach of contract claim against FEDCON arises in part out of FEDCON’s alleged failure to construct a tem porary access road and two tem porary work platform s.21 But defendants have subm itted an April 7, 20 16 letter from USACE to FEDCON in which USACE acknowledges its responsibility for at least som e of the conditions that led to FEDCON’s alleged breach of contract.22 Therefore, given the “intertwined” relationship between USACE’s conduct and the breach of contract claim between GLF Construction and FEDCON, GLF Construction’s breach of contract claim is a claim that USACE m ay have responsibility for, and GLF Construction’s lawsuit bringing the breach of contract claim is an action that USACE m ay have responsibility for.23 See United States v. Bhate Envtl. Assocs., Inc., No. 15-146, 20 16 WL 54440 6, at *3 (D. Alaska Feb. 9, 20 16) (“Suffice to say that there is an intertwined relationship between the Owner-related claim s and those that 21 R. Doc. 1 at 6-7 ¶¶ 19-24. R. Doc. 19-1 at 32. 23 The sam e is true for any breach of contract claim based on FEDCON’s term ination of the subcontract. 7 22 rest solely between the parties.”). Accordingly, the language of the subcontract agreem ent requires the stay. Further, regardless of whether the term “claim ” in paragraph 13 covers all of GLF Construction’s claim s against FEDCON, GLF Construction’s argum ent ignores the text of paragraph 23. Unlike paragraph 13, paragraph 23 not only refers to “claim s” but also states “the Subcontractor expressly agrees to stay any action or claim . . . .”24 If GLF Construction’s interpretation was correct, then the contract’s inclusion of the words “any action” would be superfluous. Additionally, even if the Court incorrectly interpreted the contract and should have not have found the agreem ent to require staying the entire litigation—a proposition for which GLF Construction offers no support other than its own self-serving interpretation —the Court would still be well within its discretion to stay the entire litigation. The Court has “broad discretion to stay proceedings as an incident to its power to control its own docket,” Clinton v. Jones, 520 U.S. 681, 70 6 (1997), and the Court should consider judicial econom y in deciding whether to stay a case, see Landis v. N . Am . Co., 299 U.S. 248, 254 (1936). As m entioned in its previous order, the contract dispute resolution procedure m ay resolve all or part of this dispute, m aking 24 R. Doc. 1-2 at 10 ¶ 23 (em phasis added). 8 further proceedings lim ited or unnecessary. Therefore, judicial econom y supports staying the entire litigation. See Bhate, 20 16 WL 54440 6, at *4 (finding that allowing som e claim s to proceed while others are stayed would create parallel proceedings, which would not only be inefficient but also contrary to judicial econom y). Finally, GLF Construction takes issue with the cases cited by the Court in its previous order, noting that these cases either had slightly different facts or different contractual language, and that they are “not controlling.”25 Of course, GLF Construction is aware that courts often rely on non-precedential cases to support their findings, and that cases (and their facts) need not be identical to be helpful. Further, the Court did not state that it was bound by any of these cases, or that the cases were identical to the dispute at hand. Instead, the Court m erely did what the federal judiciary does on a daily basis, it used well-reasoned cases that dealt with sim ilar situations as a guide. GLF Construction has pointed to nothing indicating that the Court’s citation of these cases was erroneous, m uch less m anifestly so. See Guy v. Crow n Equipm ent Corp., 394 F.3d 320 , 325 (5th Cir. 20 0 4) (defining “m anifest error” as one that “is plain and indisputable, and that am ounts to a com plete disregard of controlling law”) (internal quotation and citation om itted). 25 R. Doc. 26-3 at 5-7. 9 B. Th e Co u rt’s Pre vio u s Ord e r W ill N o t Re s u lt in Man ife s t In ju s tice Initially, GLF Construction argued that failure to lift the stay will result in m anifest injustice.26 At the tim e GLF Construction filed this m otion, FEDCON had recently asked a Florida state court to reconsider its previous order dism issing FEDCON’s claim s against GLF Construction on forum non conveniens grounds.27 According to GLF Construction, if FEDCON could pursue claim s against GLF Construction in another proceeding without GLF Construction asserting counterclaim s because of the stay, m anifest injustice would occur. On April 4, 20 17, the Circuit Court for the Ninth J udicial District in Orange County, Florida declined to reconsider its previous order and finalized the dism issal of FEDCON’s suit.28 Further, FEDCON indicates to the Court that it intends to abide by the outcom e of the dispute resolution procedures before filing any counterclaim s against GLF Construction.29 Therefore, the Court need not address GLF Construction’s m anifest injustice argum ent because it is now m oot.30 As such, GLF Construction has suffered 26 Id. at 8. R. Doc. 26-2 at 1. 28 R. Doc. 29-1 at 1. 29 R. Doc. 29 at 4. 30 In GLF Construction’s reply, it acknowledges these recent events and states that it “concedes its Motion.” R. Doc. 32 at 2. But GLF 10 27 no injustice, and any potential future injustice is hypothetical, and certainly does not rise to the level necessary for the Court to reconsider its order. Because GLF Construction fails to show that the Court’s previous order staying this case was m anifestly erroneous or that GLF Construction will suffer m anifest injustice, its m otion to reconsider m ust be denied. IV. CON CLU SION For the foregoing reasons, GLF Construction’s m otion to reconsider is DENIED. New Orleans, Louisiana, this _ 20th _ day of June, 20 17. ___ _____________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE Construction’s m otion not only argued that it faced m anifest injustice, but also that the Court m anifestly erred. See R. Doc. 26-3 at 3-7. GLF Construction’s reply does not address its m anifest error argum ent, and therefore the Court will not treat GLF Construction’s “concession” as a barrier to resolving this m otion in its entirety. 11
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