Petition for Writ of Certiorari — School Board of Beauregard Parish v. Honeywell International, Inc.

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No »=—6 ©9963. 7 NOV16 2009

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Intae OPPICE OF THE CLERK

Supreme Court of the United States

SCHOOL BOARD OF BEAUREGARD PARISH,

PETITIONER

HONEYWELL INTERNATIONAL, ING.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

PETITION FOR WRIT OF CERTIORARI

WILLIAM L. MELANCON

Counsel of Record

Melancon & Associates, LLC

900 S. College, Suite 800

(837) 233-8600

CURRY & TAYLOR @ (202) 3293 4141

Il.

II.

QUESTIONS PRESENTED

Whether the court below created an irreconcilable

conflict between Federal and State law

encouraging forum shopping when it failed to

follow well-established Louisiana jurisprudence by

sua sponte ruling that Petitioner was not entitled

to bring a claim under Loutsiana’s Unfair Trade

Practices Act, a consumer-protection statute,

thereby nullifying this remedy under Louisiana

jurisprudence and gutting this State consumer

protection statute?

Whether the court below erred when it: (1) refused

to consider Petitioner’s Daubert opposition brief

(which exceeded the 25-page local rule); then (2)

struck Petitioner’s expert based solely on

Respondent’s Daubert brief (which also violated

the 25-page local rule and included only

incomplete, selectively-truneated exhibits); and

soon thereafter (3) granted summary Judgment to

Respondent because Petitioner no longer had an

expert to prove its damages?

Whether the court below erred when it denied

Petitioner’s motion to amend and supplement its

complaint filed ten months before trial, which

added facts supporting its omgmal! complaint and

alleged new claims that arose after Petitioner filed

its orlgmal complaint?

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ., 1

TABLE OF AUTHORITIES a 1

OPINIONS BELOW. hae ee

JURISDICTION. . ; ; , ‘ —

RELEVANT PROVISIONS INVOLVED ws ; |

STATEMENT . 5

REASONS FOR GRANTING THE PETITION... 6 oe 15

APPENDIX

Corcuit Court Opinion , .

District Court Ruling 5/28/08 =) eon .. 8a

District Court Order 5/20/08 . ee Zla

Instrict Court Order 3/24/08 ; . 28a

District Court Ruling 3/24/08. 24a

strict Court Order 3/19/08... 39a

Pastrict Court Ruling 3/19/08 el «sae

District Court Order 2/29/08 46a

District Court Order 10/22/07 ny dla

strict Court Judgment 9/24/07 d2a

District Court Ruling 9/24/07 oda

Order Denying Rehearing 69a

TABLE OF AUTHORITIES

Page

CASES

ALABAMA V US ARMY CORPS OF IENGINEERS, 382

F SUPP 2D 1301, 1330-31(N D ALA 2005) 31

BETZEL V STATE FARM LLOYDS, 480 F 3D 704, 707-

709 (5TH CIR 2007) . rahe , 19, 21, 28

CLARK V CAPITAL CREDIT & CoLI LECTION SERV,

460 F 3D 1163, 1179(9TH CIR 2006)... 28

COMMERCIALES, S.A V ROGERS, 357 U.S. 197, 209,

78S CT 1087 (1958) ....... . ; ee ag — >

CONLEY V GIBSON, 788 CT 99, 103, 5 U S. 41, 48, 2

L.ED 2n 90 (1957) , . 18

DAUBERT V MERREILL DOW PHARMACEUTICALS,

INC ,509 U 8S. 579, 118S.CT 2786, 125 I. Ep 2b 469

(1993) — ae

ERIE R Co v TOMPKINS, 304U S. 64, 58S Cr 817

(1938) ae 16

FELDER V CASEY, 487 US . 131,151, 108S.CT 2302

4. Se erm Nae PU Cet 16

FOMAN V DAVIS, 371 US 178, 181, 8&8 SCr 227, 230,

9L ED 2D 222 (1962) 18, 30, 32

FRANKS V ROSS, 313 F 3D 184, 198 (4TH Cre 2002) 31

GUARANTY TRUST CO V YORK, 3826U S 99, 109, 65

S CT. 1464 (4945) ' a:

JAHN V EQUINE SERVICES, 233 K 3p 382, 393 (6TH

CIR 2000) sia 21, 26

KUMHO TIRE Co v C ARMICH. AEL, 526 US 137,119

S CT 1167, 143 TL. ED 2D 238 (1999) 11, 28, 28

MILLER V CONAGRA, 991 SO 2D 445, 455 (LA 2008).. 17

QUARATINO V TIFFANY & CO ,71 F' 38) 58, 66 (2ND

CIR 1995) 31

SMITH V FORD MOTOR Co (215 F: 3D 713, 722, (7TH

CIR 2000) . 28

TAXPAYERS WATCHDOG, INC V STANLEY, 819 F 2p

294,297(D C CIR 1987) . ; 22

WICHITA FALLS OFFICE ASSOCIATES V BANC ONE

CORP , 978 F 2p 915, 918-920 (5TH CIR 1992)

STATUTES

283T SC § 12541)

28U.SC §2101(C)

LA RS.51 1409(A)

LA RS.51 1509(A)

RULES

FED R. CIV

FED R Clv

FED R CIV

FED R.CIV

FRE 702 .

FRE 704

P 6G.

6(A)(3)

P 15

P. 15(D)

a ae

. passim

29, 30, 31

OPINIONS BELOW

The opinion of the United States Court of

Appeals for the Fifth Circurt 1s not reported, but can be

found at 328 Fed.Appx. 973, 2009 WL 2145185, 2009

U.S. App. LEXIS 15907 (5™ Cir. 2009), and 1s included

in the attached Appendix (App. la) The final summary

judgment opinion, that closed the case, issued from the

United States Distmct Court for the Western District

of Louisiana 1s not reported, but can be found at 2008

U.S. Dist. LEXIS 44056 (W.D. La, May 28, 2008), and

is included in the attached Appendix (App. 3a)

JURISDICTION

The decision of the United States Court of

Appeals for the Fifth Circuit, affirming the decision of

the district court, was entered on July 20, 2009 (App.

la). A timely filed petition for rehearing en bane was

denied on August 17, 2009. The Order denying the

Petition for Rehearing 1s unreported, but is included 1n

the attached Appendix (App. 69a). This Court has

jurisdiction pursuant to 28 U S.C. § 1254(1), and this

petition 1s timely filed pursuant to 28 U.S.C. § 2101(e).

RELEVANT PROVISIONS INVOLVED

Federal Rules of Civil Procedure

Fed. R. Civ. P 6 - Computing and Extending

Time, Time for Motion Papers

(a) Computing Time. The following rules apply

In computing any time period specified in these

»)

nae

rules or in local rule, court order, or statute.

(1) Day of the Hvent Excluded. Exclude the day

of the act, event, or default that begins the

period,

(3) Last Day Include the last day of the period

unless it is a Saturday, Sunday, legal holiday, or

—if the act to be done 1s filing a paper in court —a

day on which weather or other conditions makes

the clerk’s office inaccessible. When the last day

is excluded, the period runs until the end of the

next day that is not a Saturday, Sunday, legal

holiday, or day when the clerk’s office 1s

inaccessible.

Fed R Civ P 15 —- Amended and Supplemental

Pleadings

(a) Amendments BRefore Trial.

(2) Other Amendments In all other cases, a

party may amend its pleading only with the

opposing party’s written consent or the court’s

leave. The court should freely give leave when

justice so requires

(J) On motion and reasonable notice, the court

may, on just terms, permit a party to serve a

supplemental pleading = setting out = any

transaction, occurrence, or event that happened

after the date of the pleading to be

supplemented. The court may permit

supplementation even though the ongmal

pleading 1s defective in stating a claim or

defense. The court may order that the opposing

party plead to the supplemental pleading within

a specified time.

Fed R. Civ P 56-Summary Judqment

Y {J

must be served at least 10 days before the day

set for the hearing. An opposing party may

serve opposition affidavits before the hearing

day. The judgment sought should be rendered if

the pleadings, the discovery and disclosure

materials on file, and any affidavits show that

Lhe movant ts entitled to judgment as a matter of

law

(f) When Affidavits Are Unavailable Ifa party

opposing the motions shows by affidavit that, for

specified reasons, it cannot present facts

essential to justify its opposition, the court may.

(1) deny the motion;

(2) order a continuance to enable affidavits to be

obtained, depositions to be taken, or other

discovery to be undertaken; or

(3) issue any other Just order.

Local Rules of the Federal District Court for the

Western District of Louisiana

LR 5.7.11W — Technical Failures

A User whose electronic filing is made

impossible as the result of a technical failure in

the Court’s Web Site may seek appropriate

relief

LR 7.8W -—- Briefs

Except with permission of the judge, no bnef

shall exceed 25 pages in length, exclusive of

pages containing a table of authorities or a table

of contents, and no reply brief shall exceed 10

pages. Any brief exceeding 10 pages shall

contain (1) a table of contents with page

references and (2) a table of cases (arranged

alphabetically), statutes and other authorities

cited, with references to the pages of brief where

they are cited

Louisiana State Statutes

Louisiana’s Unfair Trade Practice Act (LUTPA)

La. R.S. 51:1409(A)

Any person who suffers any ascertainable loss of

money or movable property, corporeal or

incorporeal, as a result of the use or employment

by another person of an unfair or deceptive

method, act or practice declared unlawful by

R.S 51:1405, may bring an action individually

but not in a representative capacity to recover

actual damages. If the court finds the unfair or

deceptive method act or practice was knowingly

used, after being put on notice by the director or

attorney general, the court shall award three

times the actual damages sustained. In the

event that damages are awarded under this

Section, the court shall award to the person

bringing such action reasonable attorney’s fees

and costs. Upon a finding by the court that an

action under this section was groundless and

brought in bad faith or for purposes of

harassment, the court may award to the

defendant reasonable attorney’s fees and costs.

STATEMENT

Beauregard Parish Schoo] Board (“Petitioner’’)

is a rural Louisiana school system with a hmited tax

base In 1996, mn an effort to control its energy costs

(and update much of its hghting and air-conditioning

equipment), Petitioner entered into a_ ten-year

“comprehensive energy management” contract with

Honeywell International, — Ine (“Respondent”).

Respondent drafted the contract in which it guaranteed

that Petitioner would save at least $91,982 every year

of the ten-year contract. Among other requirements,

the contract required Respondent to replace existing

equipment (lighting, air-conditioning and automated

control-systems) with more energy-efficient equipment,

and Respondent itself specified the type of equipment 11

would install and the savings each system would

achieve.

Respondent’s documents obtained through

discovery show that it and its subcontractors failed to

install some of the energy-saving equipment entirely,

and for the equipment they did install, much of 1t did

not comply with the contract and some equipment

actually used more electricity than the old equipment it

replaced. The Respondent-drafted contract also

required it to maintain and replace equipment for the

entire ten-years of the contract, and its documents and

internal correspondence show that it faled to do so

which led to creased energy usage and premature

equipment failures that were never fully rectified

pursuant to Respondent’s own contract terms.

A year after Respondent’s installations, it

generated an internal energy-audit report which

compared Petitroner’s old energy bills with the newer

bills. This report showed that the energy use increased

immediately after Respondent’s installation, when it

should have decreased by at least $91,932 per year

according to Respondent’s contract and its guarantee.

Respondent never told Petitioner about this report, and

internal correspondence of Respondent shows that it

used the report to blame its own subcontractors for the

increase 1n energy usage.

However, throughout the contract, Respondent

never addressed these deficiencies and consistently

represented to Petitioner that it had installed the

correct equipment, that 1. was meeting the guarantee,

and any increases tn the bills were due to other factors

- when Respondent’s documents confirm that

Respondent knew the increase was its own fault In

fact, Respondent's own expert report admitted that it

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did not achieve the guarantee in every contract year

and it even specified an exact dollar shortfall for each of

those years, though these numbers were much less than

those computed by Petitioner’s expert.

In the eighth year of the contract, Petitioner

filed suit against Respondent in Louisiana District

Court alleging several state-law causes of action,

including breach-of-contract, bad faith and violations of

Louisiana’s Unfair Trade Practices Act (LUTPA), a

consumer protection statute. La R.S. 51:1409(A).

Respondent removed the case to l’ederal court relying

on diversity of citizenship.

A. The District Court Sua Sponte Struck

Petitioner’s LUTPA Claim With Reasoning

That Was Not Briefed or Argued By Either

Party, A Rationale Which Directly Conflicted

With Well-Established Louisiana

Jurisprudence

Respondent filed a motion for partial summary

judgment challenging Petitioner’s LUTPA claim; 1t

presented a fact-based argument that Petitioner’s

LUTPA claim had somehow presenbed even before the

contract had ended. La. R.S. 51.1509(A). Petitioner’s

response brief addressed the prescription issue argued

by Respondent However, instead of addressing the

fact-based prescription issue briefed by the parties, the

district court sua sponte struck Petitioner’s LUTPA

claim ruling as a matter of law that a consumer cannot

maintain a LUTPA claim if it has a valid breach-of-

contract claim; and since Petitioner had a viable breach-

of-contract claim, as a matter of law, Petitioner could

not maintam its LUTPA claim (App. 57a-58a) This sua

sponte reasoning conflicts with all Louisiana

jurisprudence as well as the main reason the legislature

enacted the statute, 1 e., to protect Louisiana consumers

when a supplier/seller breaches its contract in bad faith.

In its appeal to the Fifth Circuit, Petitioner was

joined by the State of Louisiana (through its Attorney

General) and the Acadiana Legal Services Corporation,

a non-profit law firm that provides legal representation

to indigent chents in Lousiana. Both amici argued that

the district court’s decision conflicts with existing all

Louisiana State jurisprudence (including a_ recent

Louisiana Supreme Court opinion), would encourage

forum shopping and would eliminate one of the most

important statutes enacted by the State Legislature to

protect Louisiana consumers

B. Ten Months Before Trial, While Respondent

Was Still Producing Documents’ and

Witnesses for Deposition, Petitioner Filed a

Motion to Supplement and Amend its

Complaint Which The District Court Denied

With A One-Sentence Opinion

Petitioner filed its initial complaint in the eighth

year of the ten-year contract. A year after the contract

ended and ten months before trial (while Respondent

was still producing documents and witnesses for

deposition), Petitioner filed a motion under Fed. R. Civ

P 15 to supplement and amend its complaint to include

damages that arose 1n the last two years of the contract

and to allege facts learned in discovery that supported

its original breach-of-contract, bad faith and LUTPA

claims. It also added facts related to the Louisiana

Attorney General putting Respondent on notice of its

potential violation of LUTPA for its non-performance

on this specific contract, as well as facts learned in

discovery about Respondent’s knowing bad faith La.

R. 8S. 51 1409(A)

During discovery, both parties assumed that the

district judge would allow these emergent claims to be

added into this lawsuit as both parties’ expert reports

addressed damages in all ten years of the contract and

deponents on both sides were asked questions about

claims and damages that arose in the final two years of

the contract. Nevertheless, the district court denied

Petitioner’s entire motion with a one-sentence decision

that addressed only its supplemental LUTPA claim,

failing to address any of Petitioner’s amendments to

existing claims or the other supplemental claims that

arose after the original complaint was filed. (App. 51a)

of The District Court Refused to Consider

Petitioner’s Opposition to Respondent’s

Daubert Motion (Both Parties’ Briefs

Exceeded The 25-Page Local Rule) and

Struck Petitioner’s Expert Based Solely on

Respondent’s Daubert’ Brief and _ its

Incomplete, Selectively-Truncated Exhibits;

The District Court Later Granted Summary

Judgment to Respondent Stating That

Without an Expert, Petitioner Could Not

Prove Its Damages

Eighteen weeks before trial, and fourteen weeks

before the Daubert motion deadline, Respondent filed

a Daubert challenge to Petitioner’s expert, and the

district court sua sponte set the motion for hearing

with witnesses. Respondent’s brief exceeded the 25-

page local rule, but it failed to file the required motion

for page extension, in violation of LR 78W

Petitioner’s opposition also exceeded the 25-page local

rule, but Petitioner filed a motion for page-extension.

The day after Petitioner filed its Dazxbert

opposition brief, Respondent filed an opposition to

Petitioner’s motion for page extension. However,

Respondent failed to identify any prejudice by

Petitioner’s “overlength” opposition brief. Petitioner

also argued that Petitioner’s Opposition was late, but

the District Court’s March 19, 2008 Opinion confirms

that Respondent filed its Daubert motion piecemeal

over two days - Thursday and Fmday February 7-8,

2008, making Petitioner’s Opposition due on Monday,

February 25, 2008 (according to Fed. R. Civ. 6(a)(3)

which states that if a response date falls on a weekend,

the due date 1s moved to the following Monday) (App.

40a-4la) Even if timeliness was an issue, Petitioner

filed its entire brief and all its exhibits before noon on

Monday, February 25, 2008.

Three days later, before Petitioner could file a

reply brief, the district court faxed an order denying

Petitioner’s motion for page extension, canceling the

hearing, and stating that it would decide Respondent’s

Daubert motion based solely on Respondent’s brief and

exhibits. (App. 50a) In its motion for rehearing,

Petitioner noted that since there would be a hearing

with witness testimony, Respondent would not be

prejudiced by Petitioner’s opposition, inasmuch as

Respondent would have an opportunity to address It at

the hearing and im its reply brief. Petitioner also noted

that the trial was still several months away.

The next business day, Petitioner filed a 25-page

oppnsition brief, a motion for the court to accept this 25-

page bnef and a motion for rehearing of its denial to

consider Petitioner’s original opposition bmef

(addressing errors of fact and law in the district court’s

opinion and Respondent’s failure to show how it was

prejudiced by the “overlength” brief). Petitioner’s

second (25-page) opposition was filed fifteen weeks

before trial and eleven weeks before the Daubert

motion deadline, so the later-filed brief did not effect

any trial deadlines. In fact, on Respondent’s later

motion, the district court extended the Daubert motion

deadline. (App. 21a)

Respondent’s Daubert motion included only

selected portions of Petitioner’s expert report and

deposition transcript, as well as selected portions of the

scientific journals Respondent alleged were violated by

Petitioner’s expert Both of Petitioner’s opposition

bnefs (that were not considered by the district Judge)

included the other relevant portions of the expert

report, the deposition transcript and the scientific

journals that showed that Petitioner’s expert did 1n fact

adhere to all scientific and engineering standards in

performing his expert analysis as required by Daubert

v Merrell Dow Pharmaceuticals, Ine , 509 U.S. 579, 113

S Ct. 2786, 125 L.Ed 2d 469 (1993), and Kumho Trre Co

v Carmichael, 526 US 187, 119 SCt. 1167, 1483

L.Ed.2d 238 (1999).

Nevertheless, the distmet court denied

Petitioner's motions to accept its Daubert opposition

briefs and struck Petitioner’s expert based solely on the

allegations in Respondent’s brief (App. 24a) ‘The

district court ruled that Petitioner’s expert was not

qualified to render an expert opinion on the issues in

this case, even though Respondent’s own truncated

exhibits show that Petitioner’s expert has two decades

of experience with dozens of Louisiana school systems,

both hands-on and in design, involving the very same

energy-management contracts and issues in this case,

and that he followed all scientific, engineering and

technical standards in his analysis. Remarkably, on two

previous occasions in this case, the district court

accepted affidavits from this very same expert.

[Petitioner’s expert 1s probably the foremost expert on

energy-management contracts for Louisiana school

systems. He is a Registered Professional Engineer in

numerous states and has been the “professional in

charge” on dozens of similar type projects, including

several multi-million dollar, high profile projects |

However, without Petitioner’s opposition brief, the

non-technical court was unable to properly interpret

the industry terms-of-art and acronyms _ in

Respondent’s exhibits, and the court made numerous

errors of fact that formed the basis of its decision to

strike Petitioner’s expert.

It should be noted that in its earlier ruling, the

district court stated that it was not sanctioning

Petitioner by refusing to consider either one of its

Daubert opposition briefs but that it was merely

exercising its discretion to control its docket (App. 43a-

44a)

D. Despite Petitioner’s Pending Motion to

Compel Documents and to Reopen

Depositions, the District Court Granted

Respondent’s Motion for Summary

Judgment Essentially Ruling That Without

an Expert, Petitioner Would Be Unable to

Prove Its Damages

Several months before tnal, Petitioner filed a

motion to compel discovery due to Respondent’s non-

production of more than 5000 pages of documents and

requested that it be allowed to retake depositions after

the new documents were produced. Petitioner’s motion

meticulously described these non-produced documents

that were either discussed in documents previously

produced by Respondent and its subcontractors or by

Respondent’s employees in their depositions. These

non-produced documents included emails and other

internal correspondence that would likely include

admissions of Respondent’s non-performance.

Petitioner provided an affidavit with 1ts motion stating

how the documents were needed to_ refute

Respondent’s defenses — the very defenses that were

later raised by Respondent in its motion for sammary

judgment.

Both parties fully briefed Petitioner’s motion to

compel, and the parties were awaiting a decision by the

court (on the briefs) when Respondent filed its motion

for summary judgment arguing that without an expert,

Petitioner could not prove its damages. Petitioner

opposed the motion, arguing that even without an

expert, internal documents of Respondent admitted

both habilty and exact dollar-damages for many of

Petitioner’s claims

Specifically, Respondent’s own expert admitted

in his report that Respondent had not met the

guarantee in every year of the contract, and he gave

the exact dollar amount of the shortfall in each of those

years. Respondent’s employees admitted that they

had not installed much of the energy-saving equipment

enumerated in the Respondent-drafted contract that

also specified the annual dollar savings each piece of

equipment would save over the entire ten years of the

contract. Petitioner argued that these documents and

admissions would be enough for a jury to determine

damages without an_ expert. Additionally,

Respondent’s motion for summary Judgment was not

supported by affidavits, while Petitioner’s opposition

was supported by deposition testimony and admissions

in Respondent’s own documents, and Petitioner also

reminded the district court of its pending motion to

compel.

Nevertheless, the district court granted

summary judgment to Respondent and dismissed

Petitioner’s complaint, never addressing Petitioner’s

pending motion to compel

Petitioner appealed the district court’s decision

to the Fifth Ciremt Court of Appeals and was

supported with amicus briefs from both the State of

Louisiana and the Acadiana Legal Services

Corporation, a non-profit law firm providing legal

assistance to those who cannot afford legal

representation.

On July 20, 2009, the Court of Appeals issued a

four-sentence opinion affirmmg the district court for

the reasons given by the district court in 1ts various

decisions (App. la) On August 17, 2009, the Court of

Appeals demed Petitioner’s motion for rehearing and

rehearing en banc. (App. 69a) Since the Court of

Appeals decision adopted the reasons and rulings

issued by the district court, this petition addresses the

reasons given by the district court.

REASONS FOR GRANTING THE PETITION

A. The District Court’s Sua Sponte Reasoning

in Striking Petitioner’s LUTPA Claim

Creates an Irreconcilable Conflict Between

State and Federal Law That Will Encourage

Forum Shopping and Nullify Well

Established Louisiana Jurisprudence Under

the State’s Most Important Consumer

Protection Statute, Thereby Cancelling This

Remedy Under Louisiana Law

This Court has an interest m assuring that lower

courts do not create irreconcilable conflicts between

Federal Courts and State Courts 1n their interpretation

of state statutes so as to prevent/mimimize forum

shopping. The district court’s decision here, affirmed

by the Fifth Circuit, clearly creates a forum-shopping

situation with regards to this important consumer-

protection statute —- so much so that it elicited two

amucus briefs in the Fifth Circuit, one from the State of

Louisiana and one from a non-profit, legal services

corporation that represents indigent chents in

consumer transactions.

It should be noted that Petitioner filed its

complaint in Louisiana State District Court and

Respondent removed the case to Federal Court. If the

case had not been removed from State court to Federal

Court, Petitioner would not have lost its mght to bring

a LUTPA claim in this lawsuit. See, Emre R Co. v

Tompkins, 304 U.S 64, 58 8.Ct. 817 (1938).

“Under Hre, when a federal district court

exercises diversity, pendent or supplemental

jurisdiction over State law claims, ‘the outcome of the

litigation in the federal court should be substantially

the same, so far as legal rules determine the outcome of

a htigation, as it would be if tned in a State court.”

Felder v Casey, 487 US 131, 151, 1085S Ct. 2302 (1988),

quoting, Guaranty Trust Co v. York, 326 U.S 99, 109,

65 S Ct. 1464 (1945). Avoiding judge-made rules in

federal court, which undercut a htigant’s mghts which

he otherwise would enjoy under state law, promotes

comity and federalism, discourages forum-shopping and

acknowledges that the pronouncements of the state

courts on the substantive rights of its citizens are in

most cases expressions of their sovereignty.

LUTPA was enacted primarily to protect

consumers from unethical business practices by sellers.

In its sua sponte reasoning, affirmed by the Fifth

Cireuit, the district court ruled that as a matter of law,

if a consumer has a breach-of-contract claim, then it

cannot also maintain a claim under LUTPA. As noted

by both amici in their bnefs to the Fifth Circuit, the

very nature of the consumer-seller legal relationship

imphes that a mistreated consumer will automatically

have a breach-of-contract claim, and when the seller’s

behavior violates the heightened ethical standards

required by LUTPA, the Louisiana legislature wanted

to give consumers the right to pursue an additional

cause-of-action to recover additional damages.

As noted by both amici, the district court opmion

directly conflicts with well-estabhshed Louisiana

jurisprudence that allows all types of consumers to

bring both a breach-of-contract claim and an additional

cause-of-action under LUTPA when the seller’s breach

is particularly egregious. Hg, Miller v. Conagra, 991

So0.2d 445, 455 (La. 2008)(this heightened ethical

determination 1s a question of fact for the jury)

Given this district court decision, as affirmed by

the Fifth Circuit, defendant-sellers will undoubtedly

attempt to remove to the Federal courts all LUTPA

claims filed in state court seeking LUTPA damages.

Even when the breach-of-contract damages alone do

not meet the dollar-threshold for Federal court

jurisdiction, since LUTPA allows for additional

damages, it will not be difficult for out-of-state

defendants to allege the jurisdictional threshold for

removal

B. The District Court Erred When It Allowed

Respondent to File A Daubert Motion Brief

That Exceeded The 25-Page Local-Rule

Limitation But Refused to Consider

Petitioner’s Opposition Brief That Also

Violated the Same Local Rule; And Then,

Using Only Respondent’s Brief and Its

Selectively-Truncated Exhibits, Struck

Petitioner’s Expert and Entered Summary

Judgment for Respondent By Ruling That

Without An Expert, Petitioner Could Not

Prove Its Damages

A basic principle of American jurisprudence is

that the courts will apply their rules consistently to all

parties This Court has not spoken recently about the

need for district courts to apply thei local rules

consistently and fairly, but this is a necessary maxim to

promote public-confidence in our Federal legal system.

Foman v. Davis, 371 US. 178, 181, 88 S.Ct. 227, 230, 9

L.Ed.2d 222 (1962)(It is “contrary to the spirit of the

Federal Rules of Civil Procedure for decisions on the

ments to be avoided on the basis of such mere

technicalities.”) Conley v Gibson, 78 S.Ct. 99, 103, 355

U.S. 41, 48, 2 L Ed.2d 90 (1957)(“The Federal Rules

reject the approach that pleading 1s a game of skill in

which one misstep by counsel may be decisive to the

outcome and accept the prmciple that the purpose of

pleading is to facilitate a proper decision on the

merits.” (emphasis added).

The district court’s application of its 25-page

local-rule limitation to Petitioner to bar its submission

but not bar Respondent’s 27-page bmef, in the very

same motion, violates the fundamental principle that

the courts will apply their rules fairly, equitably and

uniformly to all parties in a lawsuit.

ae For Daubert Motions, Lower Courts

Need More Guidance Regarding the

Minimum Effort Required to Satisfy

Their “Gatekeeper” Responsibilities,

When Local Rules May Justify Striking

a Party’s Opposition Entirely, and

What Is the Initial Burden-of-Proof

Required for a Daubert Motion

While this Court has provided some guidance to

lower courts regarding their “gatekeeper”

responsibilities in analyzing a Daubert opposition, this

Court has provided little guidance as to when a district

court 1s justified in refusing to consider a Daubert

opposition brief entirely. Most circuit courts have held

that tt 1s reversible error for a district court to deny a

party the opportunity to provide expert testimony to

support its claims -— even when local rules were

violated, the trial has to be continued and the opposing

party was the sole reason for the continuance See,

Betzel v. State Farm Lloyds, 480 F.3d 704, 707-709 (5'"

Cir. 2007)(It was an abuse of discretion for the district.

court to sanction the insured for naming his expert late

by prohibiting the expert’s testimony, when the

insured could not otherwise prove its damages and any

prejudice could have been cured with a continuance -

the court’s preferred means for dealing with a late-

named expert.) (Here, a continuance would not have

been required, since Petitioner filed its original

opposition timely and its 25-page opposition brief one

week later — fifteen weeks before trial )

Koman v Davis, and Conley v. (nbson hold that

strict adherence to the dictates of local rules (which are

designed to help get cases to a trial on the merits)

sometimes must yield to the interests of justice in order

to avoid a harsh “sanction” of preventing a party from

presenting its case on the ments. Further, when a

party 1s denied an opportunity to submit an opposition

because of a nominal violation of court rules, it has been

denied constitutional due _ process. See, Societe

Internationale Pour Partiervpations Industrelles et

Commerciales, SA. v Rogers, 357 U.S. 197, 209, 78

S.Ct. 1087 (1958)(“{ There are constitutional hmitations

upon the power of courts, even in aid of their own valid

processes, to dismiss an action without affording a

party the opportunity for a hearing on the merits of his

case "’)

Here the district court stated that it was not

sanctioning Petitioner by refusing to consider its

Daubert opposition briefs, but that it was merely

exercising its discretion to control its docket. (App. 43a-

44a) However, there was no stress being put on the

docket since Petitioner’s initial opposition was filed /2

weeks before the Daubert motion deadline and 16 weeks

before tmal; and Petitioner’s 25-Page Daubert

Opposition was filed 11 weeks before the Daubert

motion deadhne and 15 weeks before trial.

Furthermore, on Respondent’s motion, the district

court later even extended the Daubert motion deadline.

(App 2la-22a)

In its March 19, 2008 opinion, the district court

noted that Respondent never alleged it was prejudiced

by Petitioner’s opposition bnmefs (either its length or

timeliness), but ruled that prejudice was not required if

Petitioner violated a local rule (App. 48a) However,

prejudice to an opposing party 1s a primary factor for

district courts to consider when allowing or disallowing

late-filed oppositions. Betzel v State Farm Lloyds, 480

F.3d 704, 707-709 (5 Cir 2007).

According to the district court’s own local rules,

i. should not have even considered Respondent’s

Daubert bref since it exceeded the 25-page local-rule

limitation requiring a motion for leave of court. (LR

78W) Respondent failed to file the required motion for

leave, and the district court never swa sponte granted

leave to Respondent In its March 19, 2008 opimon, the

district court stated that “when parties depart from

deadlines, they must file for leave of court.” (App.44a)

The same reasoning should apply when a party, like

Respondent, files a memorandum that exceeds the page

hmutations of the district court’s own local rules but

fails a motion for leave of court

On the merits, the district court should have

demed Respondent’s Daubert motion since Respondent

failed to present a complete record for adjudication —-

Respondent’s exhibits included only selected portions

of Petitioner’s expert report, an incomplete deposition

transcript and very selected portions of the scientific

journals which Respondent alleged were violated by

Petitioner’s expert Jahn vw Equine Services, 233 F 3d

382, 3938 (6" Cir. 2000)(“[ A] district court should not

make a Daubert determination when the record is not

adequate to the task.”) Both of Petitioner’s opposition

briefs — which the district judge refused to consider -

included the other relevant portions of these documents

which demonstrated that Petitioner’s expert did, in

fact, adhere to all scientific and engineering standards

in performing his expert analysis in this case

Respondent failed to meet its burden incident to

its Daubert motion, because it submitted an incomplete

record to the distmct court. At a minimum, without an

opposition, a Daubert proponent should be required to

submit Petitioner’s entire expert report, the entire

deposition transcript of that expert and al] relevant

portions of the scientific journals it cites (rather than

just the piecemeal pages that promote its argument)

especially when the Daubert decision will lead to

summary judgment against the opposition. Taxpayers

Watchdog, Inc. v. Stanley, 819 F.2d 294, 297 (D.C. Cir

1987)(“A party seeking summary disposition bears the

heavy burden of establishing that the ments of his case

are so clear that expedited action is justified.”) Recall

that here, Petitioner did not refuse to submit an

opposition — 21t submitted two The only reason it was

denied an opportunity to be heard was because of the

district court’s selective application of the local rules.

2. Especially in Daubert Motions, Where

a Non-Technical Court Must Attempt

to Understand Sciences and

Engineering (with its Technical

Terms-of-Art and Acronyms) That It is

Not Familiar With, Opposition Briefs

Are a Necessity to Prevent Factual

Errors

Opposition bnets, hearngs and_ cross-

examination help courts to assure rehability of the

evidence presented and to avoid critical factual

misinterpretations underlying thew legal

determinations and _ decisions. Oppositions are

especially critical in Dawbert motions where the district

court is required to deal with unfamiliar scientific terms

and technologies that can easily be ‘misunderstood

without opposition briefs and exhibits

As noted in Justice Scalia’s concurring opinion 1n

Kumho Tire Co, Ltd v. Carmichael, 526 U.S. 187, 158-

59, 119 S.Ct. 1167, 1179, 143 L Ed 2d 238 (1999), while a

district court has discretion “in choosing the manner of

testing expert reliability” (its gatekeeper function), it

“is not discretion to perform the function inadequately.”

Soon after Respondent filed its Daubert motion, the

district court issued a briefing schedule and sua sponte

set the motion for hearing with oral argument and

witness testimony. So evidently, the district court felt

it necessary to have briefs from both parties, oral

argument and witness testimony to properly perform

its gatekeeper function for this particular Daubert

motion

The district court gave no justification why two

weeks later it felt 1t could decide this Daubert Motion

without Petitioner’s opposition bmef, without oral

argument, without witness’ testimony, without

Petitioner's entire expert report and without the entire

deposition transcript of this expert. In performing its

gatekeeper function, the district court must use a

“reasonable means” to determine whether or not the

expert opinion is “fausse” or the science is “junky”.

Kumho Tire Co , 526 U.S. at 158-59, 119 S.Ct at 1179

Here, the district court failed to use a reasonable means

to perform its Daubert gatekeeper responsibilities.

Without Petilioner’s Daubert opposition, this

district court made many factual errors that are too

numerous to fully discuss in this petition; but a few

examples will show how a district court can easily make

factual errors that would not have occurred if it had

considered Petitioner’s opposition brief and why the

facts of this case make it especially appropriate for cert.

In its Daubert ruling, the district court did

understand that the relevant engineering science at

issue typically goes by the acronym “M&V”, but it

improperly found that Petitioner’s expert did not have

“M&V” experience. (App. 26a-28a) “M&V” is the

acronym for “Measurement and Verification” — the

engineering science involved with measuring energy

use of buildings. “M&V” for school system projects

often use the further detailed acronyms of “EA”

(Energy Audit), “TA” (Technical Assistance Audit) and

“Commissioning” — the three phases of M&V typically

used for energy-analysis of schools and_ hospitals.

Respondent’s own Daubert exhibits show that

Petitioner’s expert has two decades of “EA”, “TA” and

“Commissioning” experience. However, without

Petitioner’s opposition brief, the district court was

unaware of these industry acronyms and terms-of-art,

which led to its determination that Petitioner’s expert

had no relevant “M&V” experience with schools

The footnotes in the district court’s Daubert

ruling show that its “fact-findings” were basically taken

verbatim from the allegations in Respondent’s brief.

(App. 36a-38a) Factual errors in Respondent’s brief

were copied almost verbatim in the district court’s

Daubert ruing For example in its bnef, Respondent

alleged that Petitioner’s expert had never run the

METRIX computer program, when exhibits attached

to Respondent’s motion show that he had personally

run the program at least 25 times; the district court

cited Respondent’s incorrect allegation as a “fact” and

relied on that “fact” in making its decision to stmke

Petitioner’s expert (App. 27a-28a)

The district court accepted wholesale

Respondent’s argument that Petitioner’s expert did not

use an appropriate analytical methodology for

analyzing this school system’s energy use (App. 28a-

30a) However, Respondent’s exhibits contained only

selectively, truncated portions of the industry journals

it chose to provide; it did not provide all the relevant

industry standards the court needed for a competent

analysis of this expert’s methodologies. Petitioner’s

opposition contained the other relevant portions of

these journals, as well as affidavits that fully explained

how Petitioner’s expert did indeed follow all industry

standards for a proper “M&V” analysis of this specific

school system (including the specific geography,

weather patterns, building configurations, building

construction, schedules and peripheral uses of energy

at this particular schoo] system). However, without the

entire expert report, the entire deposition transcript

and ali the relevant industry journals (to say nothing of

opposition briefs, oral argument and _ witness

testimony), the district court was unable to meet the

minimum requirements of its gatekeeper

responsibilities under Daubert and Kumho Trre.

In performing his analysis, the district court

correctly noted that Petitioner’s expert used the

system-wide, whole-bulding M&V analysis — one of

four accepted industry M&V analysis methods. (App.

28a-29a) This analysis method was also mandated by

the contract. (Respondent’s own expert has even

written approvingly about this analytical method.)

However, the district court uncrtically accepted

Respondent’s argument that the whole-building M&V

analysis was not appropriate here. (App. 28a-3la) Both

of Petitioner’s unaccepted oppositions contained the

missing journal pages not included with Respondent’s

brief, and they support how the system-wide, whole-

building M&V analysis used by Petitioner’s expert was

by far the most-accurate M&V analysis method for

analyzing energy use at this particular school system.

It 1s not the provimce of the distnet court to

strike an expert merely because it thinks another

analytical method 1s better than the method used by

the expert if that method is accepted by the applicable

scientific community and applied within industry

norms. Further, without all the appheable scientific

journal pages, the district court was not in a position to

determine whether or not Petitioner’s expert adhered

to the standards for using the system-wide, whole-

building M&V analytical methodology Jahn v Equine

Services, 233 F.8d 382, 393 (6% Cir 2000)(“[A] district

court should not make a Duuwbert determination when

the record 1s not adequate to the task.”). The district

court made lay-assumptions that Petitioner’s expert

should have considered some technical factors and

improperly considered others, when the full expert

report and the industry journals show that Petitioner’s

expert properly applied the requirements of the whole-

building M&V analytical method to this particular

school system

The district court also erred when it ruled that

Petitioner’s expert was prohibited from testifying

about Respondent’s bad faith in its performance of this

contract as a matter of law. (App. 28a) The prohibition

of expert testimony 1n criminal cases regarding mens

rea does not apply to expert testimony in civil cases.

See, FRE 702, 704(a), 704(b), 1972 Comments to FRE

704, (Proving bad faith is a requirement for recovery of

LUTPA damages, as well as a separate cause-of-action

under Louisiana law, and Petitioner planned to use its

expert to prove Respondent’s bad faith.) Given his

decades of experience with these kinds of energy-

services contracts with Louisiana schools, Petitioner’s

expert 1s more than qualified to testify as to whether

Respondent was in bad faith in its performance of this

particular contract.

Daubert opposition briefs help the court to

minimize misunderstandings of the science and

technical-terminology involved, but they also help to

prevent the district court from making faulty

assumptions about the facts or the science being

applied While it is not per se error for a district court

to not hold a Daubert hearing to comply with its

minimum “gatekeeper” responsibilities, 1t may be per se

error for the district court to refuse to consider an

opposition brief when one 1s offered. While a district

court has diseretion “in choosing the manner of testing

expert reliability” (ts gatekeeper function), it “1s not

discretion to perform the function inadequately.”

Kumho Trre, 526 U S. 137, 158-59, 119 S.Ct. 1167, 1179

(J. Scaha’s concurring opinion).

3. Summary Judgment Is Improper When

it Is Based on an Improper Striking of

Expert Testimony and When There Is

a Pending Motion to Compel

When the district court improperly stmkes a

party’s expert proof and later enters summary

judgment because of the lack of expert testimony, most

circuits have held that this is grounds for reversing the

summary Judgment award. Eg, Betzel v State Farm

Lloyds, 480 F.8d 704, 709 (5" Cir. 2007); Smith v Ford

Motor Co , 215 F.3d 718, 722 (7 Cir. 2000).

In its opposition to Respondent’s motion for

summary judgment, Petitioner reminded the district

court of its pending motion to compel which was fully

brnefed and was awaiting decision before Respondent

even filed its motion for summary Judgment Wichita

Falls Office Associates v Bane One Corp , 978 F.2d 915,

918-920 (5" Cir. 1992)(It 1s reversible error for a district

court to enter summary judgment against a party when

there 1s a pending motion to compel and the opposing

party has put the court on notice of the pending motion

— with or without an affidavit); Clark v Capital Credit

& Collection Serv, 460 F3d 1163, 1179 (9th Cr

2006)(“[t]he district court was required to determine

the merits of the Clark’s pendmg discovery motion

before ruling on the summary judgment motion.”)

C. While This Court Has Provided Clear

Guidance Regarding Standards to Apply

Regarding Motions to Amend Under Fed. R.

Civ. P. 15(a), It Has Provided Little

Guidance About When A District Court Is

Justified In Denying a Motion’ to

Supplement Under Fed. R. Civ. P.“15(d); On

its Face, The District Court’s Refusal to

Allow Petitioner to Supplement and Amend

its Complaint Ten Months Before Trial (at a

Time When Respondent Was Still Producing

Documents and Witnesses for Deposition)

Appears To Be Per Se, Reversible Error

Petitioner’s initial complaint was filed in the

eighth year of a ten-year contract and was based only

on facts known to Petitioner at the time of filing. Over

the next two years, Respondent produced documents

pursuant to discovery requests and the contract ended

— Le., Petitioner learned new facts supporting its

existing claims and new claims arose in the final two

years of the contract.

Within a year after the contract ended and ten

months before tnal, Petitioner filed its motion to

supplement and amend its complaint to update its

existing pleadings with facts learned in discovery and

to add the claims that arose 1n the last two years of the

contract. At the time, Respondent was still producing

documents and witnesses for deposition, but Petitioner

wanted to file 1ts motion even though Respondent had

still not completed its discovery obligations

Respondent opposed the filing but made no significant

showing of prejudice as to why Petitioner should not be

allowed to file 1ts motion.

Fed R Civ. P 15(a) governs amendment of

pleadings for events that occurred before an existing

complaint was filed, and Fed. R. Civ P. 15(d) governs

supplementation of the complaint to add new claims

that arose after the complaint was filed. This Court has

consistently held that under Rule 15(a), leave to amend

a complaint should be freely granted, especially when

the opposing party is still producing documents and

witnesses for deposition and has not shown any

prejudice by the amendment. H.g, Foman v Davis,

371 U.S. 178, 182, 88 S.Ct. 227, 9 LEd.2d 222

(1962)(denying leave to amend, absent articulable

reason, 1s "not an exercise of discretion” but an “abuse

of that discretion and inconsistent with the spint of the

Federal Rules."). However, this Court has given little

guidance to lower courts when leave to supplement

must be granted - Fed. R Civ. P. 15(d).

The district court demed Petitioner’s motion to

supplement and amend its complaint in its entirety with

a one-sentence decision that addressed only

Petitioner’s supplemental LUTPA claim; it failed to

address any of the other amending or supplemental

claims. (App. 5la) After Petitioner filed 1ts motion to

supplement and amend, the district court issued its swa

sponte ruling on Petitioner’s causes of action under

LUTPA. Since Petitioner’s supplemental and

amending complaint addressed many other claims, the

district court should not have demed the motion in its

entirety In addition, since Petitioner wanted to

preserve for appeal its LUTPA claims that arose both

before and after it filed its initxal complaint, the district

court should have allowed Petitioner’s

amending/supplemental complaint to be filed and then

entered a second summary judgment on_ the

supplemental LUTPA claims, as suggested by

Petitioner.

Many lower courts have held that a motion for

leave to supplement under Rule 15(d) should be

governed along the same “should be freely granted”

standard governing motions to amend under Rule15(a)

Eg, Quaratino v Tiffany & Co., 71 F.3d 58, 66 (2™ Cir.

1995)(The “should be freely granted” standard for Rule

15(a) motions cited in Foman v Davis should be applied

to Rule 15(d) motions)

Petitioner should not have been forced to file a

separate lawsuit to preserve the claims that arose in

the last two years of the contract. As noted in

Alabama v US Army Corps of Engineers, 382 F.

Supp. 2d 1301, 1830-31 (N D. Ala 2005).

The pohcy of judicial efficiency that "a party

should be given every opportunity to joi all of

his grievances against another party regardless

of when they arose" underlies the current, more

permissive trend. See Wright & Miller, supra, at

§ 1506; see also Franks v Ross, 313 F.3d 184, 198

(4th Cir. 2002)(noting that "[vJarious courts have

concluded that requiring a plaintiff to go through

the needless formalty and expense of instituting

a new action when events occurring after the

original filing indicated he had a nght to relief 1s

inconsistent with the philosophy of the Federal

rules").

Under Fed. R. Civ P. 15(d), Petitioner asserts

that the district court erred when it denied Petitioner’s

request to add supplemental claims because: (1) all of

Petitioner’s supplemental claims were directly related

to the contract at issue; (2) Respondent was still

producing documents and witnesses for deposition at

the time of the motion; (3) both parties’ experts had

prepared their reports assuming ten-years of damages

(i.e, that the new claims would be supplemented into

the current lawsuit); (4) the tnal was still ten months

away; and (5) Respondent provided no sigmficant

argument showing how it would be prejudiced if

Petitioner were allowed to file its Supplemental and

Amending Complaint.

Here, the district court’s one-sentence decision

denying Petitioner’s motion to supplement and amend

only addressed Petitioner’s supplemental LUTPA

clams. It did not give a reason for denying any of

Petitioner’s amending claims or any of Petitioner’s

other supplemental claims. Without reasoning, the

appellate court could not make a reasonable evaluation

of the district court’s decision. Under Fed R Civ. P.

15(a), this Court stated:

[T]he grant or denial of an opportunity to amend

is within the discretion of the Distmcet Court, but

outright refusal to grant the leave, without any

justifying reason appearing for the demal 1s not

an exercise of discretion; 1t is merely abuse of

that discretion and inconsistent with the spirit of

the Federal Rules.” Foman v Davis, 371 US.

178, 182, 83 S.Ct. 227, 9 L.Ed 2d 222 (1962).

Under any circuit court guidelines, it was an

abuse of discretion for the district court to deny

Petitioner’s motion to amend and supplement its

complaint The district court’s one-sentence denial of

Petitioner’s motion, that only addressed Petitioner’s

supplemental LUTPA claim, failed to give reasoning to

support its demial of any of the amending claims and the

other (non-LUTPA) supplemental claims. Further,

since Petitioner wanted to preserve its supplemental

LUTPA claims for appeal, the distnet court should

have allowed those claims to be added as well and then

dismissed them via summary judgment.

CONCLUSION

For all the reasons identified herein, Petitioner

requests this Court to grant this petition and issue a

writ of certiorari to the Fifth Circuit Court of Appeals.

Respectfully Submitted,

Wilham L. Melancon*

Melancon & Associates, LLC

9008S College, Suite 300

Lafayette, LA 70508

(387) 233-8600

* Counsel of Record

(any footnotes trail end of each document)

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 08-30641

SCHOOL, BOARD OF BEAUREGARD PARISH,

Plaintiff-Appellant,

versus

HONEYWELL INTERNATIONAL, INC,

Defendant-Appellee.

No. 08-31004

SCHOOL BOARD OF BEAUREGARD PARISH,

Plaintiff-Appellant,

versus

HONEYWELL, INC,

Detendant-Appellee.

July 20, 2009, Filed

NOTICE: PLEASE REFER TO FEDERAL

RULES OF APPELLATE PROCEDURE RULE 82 |!

GOVERNING THE CITATION TO UNPUBLISHED

OPINIONS.

Appeals from the United States District Court for the

Western District of Louisiana. No. 2 05-CV-1388.

Before HIGGINBOTHAM, SMITH, and

SOUTHWICK, Circuit Judges

PER CURIAM: *

The school board sued the defendant company,

asserting state law claims regarding a contract to

provide various types of equipment and _ services

designed to save energy expenses for the school

district. In several rulings explained by memorandum

orders, the district court granted summary judgment

for the defendant and assessed sanctions, and the school

board appeals.

We have reviewed the briefs, the applicable law, and

pertinent portions of the record and have heard the

arguments of counsel. The rulings are free of reversible

error, and the judgment is AFFIRMED, essentially for

the reasons supplied by the district court.

Footnotes

*Pursuant to 5TH CIR R 475, the court has

determined that this opimon should not be published

and is not precedent except under the limited

circumstances set forth m 5TH CIR R 47.5.4

DOCKET NO. 2:05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

HONEYWELL INC.

May 28, 2008, Decided

May 28, 2008, Filed

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY.

MEMORANDUM RULING

Before the court 1s defendant Honeywell, Inc's

(hereinafter "Honeywell") Motion for Summary

Judgment [doc. 139]. The plaintiff, Beauregard Parish

School Board (hereinafter "BPSB"), filed a

Memorandum 1n Opposition [doc. 141]. Honeywell filed

a Reply [doc. 143]. The matter is scheduled for a two-

week jury trial starting on June 23, 2008.

FACTS

On April 24, 1996, BPSB and Honeywell entered into a

contract (heremafter "the contract") that required

Honeywell to install new, energy-efficient light bulbs

and ballasts at fifteen school campuses and office

bunldings in the distmet ' The contract was to provide

BPSB with operational savings of $ 52,833 in the first

year, and $ 15,600 in years two through ten * The

contract also required Honeywell to provide one hour of

training annually to principals, faculty, and staff at each

campus on energy efficiency, lighting, and HVAC

Honeywell was also required to provide one hour of

training annually for all school coordinators, and four

hours of training annually to maintenance personnel. 4

BPSB paid Honeywell for all of Honeywell's work in

November of 1996. °

On September 24, 2007, this Court granted partial

summary judgment in favor of Honeywell, and

dismissed BPSB's extracontractual claims, which

included: a Louisiana Unfair Trade Practices and

Consumer Protection Law claim, a misrepresentation

claim, an unjust ennmchment claim, a detrimental

reliance claim, and a claim for new Trane chillers. ® This

Court also found that the contract's consequential

damage waiver clause 1s enforceable. ’ This Court also

found that the contract between Honeywell and BPSB

is fully integrated.®

On March 24, 2008, this Court granted Honeywell's

Motion to Exclude Expert Testimony of Lawrence W.

Blanchette in its entirety ° The Court found that

Blanchette did not qualify for expert status 1n the field

of measurement and verification (hereinafter "M&V")

savings. !° The Court further found that a utility bill

analysis is an inappropniate measure of M&V savings in

this case because energy savings are a small percentage

of district-wide savings, especially where Blanchette

failed to account for several crucial variables, such as

weather and new computers, which require more air

conditionmg. ' This Court also restated that pre-

contractual negotiations are inadmissible because the

contract 1s fully integrated. ™

SUMMARY JUDGMENT STANDARD

A court should grant a motion for summary Judgment

when the file, including the opposing party's affidavits,

demonstrates that "there 1s no genuine issue of material

fact and that the moving party 1s entitled to a judgment

as a matter of law" FED. R. Ctv. P. 56(c); Celotex Corp

v Catrett, 477 U.S. 317, 323-24, 106 S. Ct 2548, 91 L.

Ed. 2d 265 (1986). The party moving for summary

judgment 1s initially responsible for demonstrating the

reasons justifying the motion for sammary Judgment by

identifying portions of pleadings and discovery that

demonstrate the lack of a genuine issue of material fact

for trial. Tubacex, Inc v M/V Risan, 45 F.3d 951, 954

(5th Cir. 1995). The court must deny the moving party's

motion for summary judgment if the movant fails to

meet this burden. /d

If the movant satisfies this burden, however, the

nonmoving party must "designate specific facts showing

that there 1s a genuine issue for trial." Jd In evaluating

motions for summary judgment, the court must view all

facts in the light most favorable to the nonmoving

party Matsushita Elec Indus. Co v Zenith Radio

Corp , 475 U S. 574, 587, 106 S. Ct. 1848, 89 L. Ed. 2d

538 (1975) There 1s no genuine issue for trial, and thus

a grant of summary Judgment 1s warranted, when the

record as a whole "could not lead a rational finder of fact

to find for the non-moving party...." /d

ANALYSIS

Honey well brings 1ts Motion for Sammary Judgment to

dismiss all of BPSB's remaining claims. First,

Honeywell seeks summary judgment on claims BPSB

raised for the first time through Blanchette's expert

report. Second, Honeywell secks summary judgment on

all of BPSB's remaining claims.

A.) Claims Raised For the First Time in

Blanchette's Expert Report

Blanchette, on BPSB's behalf, raised extracontractual

claims against Honeywell for annual construction

advice, missed technological opportunities, I’irst Street

School analysis, and replacement lighting Honeywell

argues that the parties' contract never provided for

these items. Honeywell also argues that these claims

are not contained within BPSB's complaint, the Rule

26(a)(1) disclosures, or interrogatories.

BPSB argues that the contract is not integrated

because integration 1s a common-law concept that

Louisiana's civil law does not recognize (citing

Litvinoff, The Law of Obligatwns, Part I § 12.93).

BPSB also argues that Honeywell's engineer stated

that the contract could not be understood from the four

corners of the document and thus the contract 1s not

fully integrated.

If contractual terms are unambiguous, the contract may

be interpreted as a matter of law, making summary

judgment appropnate. Brown v Drillers, Ine , 93-1019

(La. 1114194); 630 So 2d 741, 750; see also LA. STAT.

ANN. CIV CODE art 2046. When a contract 1s clear,

the court may look no further than the four corners of

the document and cannot consider parol evidence. LA.

STAT. ANN. CIV. CODE art 1848. Furthermore,

Louisiana law gives effect to integration clauses where

the contract properly reflects the parties' intentions.

Condrey v SunTrust Bank of Georgia, 429 F.3d 556,

564 (5th Cir. 2005) (finding under Louisiana state law

that a contract was fully integrated when it contained

language that "[t]his agreement sets forth the entire

agreement and understanding between the parties as to

the subject matter of this agreement ..").

The contract between Honeywell and BPSB 1s fully

integrated. '’ The contract does not require Honeywell

to provide annual construction advice. % This contract

also does not require Honeywell to affirmatively seek

technological opportunities for BPSB. ' The contract

does not require Honeywell to perform any work at the

First Street School. * Because the contract between

BPSB and Honeywell 1s fully integrated, Honeywell is

only bound to perform the terms of the contract, and

thus these extracontractual claims are dismissed.

Blanchette also claims that Honeywell should remove

and replace all of the lighting at a cost of $ 595,085

BPSB does not present competent summary judgment

evidence that Honeywell should replace all of the

lighting. BPSB cites to one page out of a catalog to

show that Honeywell installed improper hghting. ™

Thus, BPSB's claim that Honeywell should provide

replacement lighting at a cost of $ 595,085 is also

dismissed

B.) BPSB's Remaining Claims

BPSB's remaining claims are based upon Honeywell's

alleged failure to provide the energy savings promised

in the contract and Honeywell's alleged breach of

contract with respect to the hghting installation.

1) Knergy Savings and Damage Claims

BPSB is suing for damages relating to the energy

savings guarantee in the contract and other energy

savings BPSB argues Honeywell should have provided.

BPSB alleges that the chiller and hghting equipment

Honeywell installed did not save energy as promised

over a ten-year period, and actually increased BPSB's

operational costs

"Louisiana law forbids an award of damages based on

speculation." Stokes v Georgia-Pacific Corp , 894 F.2d

764, 770 (5th Cir. 1990). Louisiana courts have granted

summary Judgment 1n contract cases where the plaintiff

could not present proper proof of damages. Infusion

Res, Inc v Minimed, Inc, 351 F 3d 688, 695-96 (5th

Cir. 2003). Similarly, summary judgment is also

appropriate when the plaintiff fails to raise a material

issue of fact regarding causation See Vekic v Wood

Energy Corp , 2004 U.S. Dist. LEXIS 21388, 2004 WL

23 6773 2, *38 (KH.D La Oct. 20, 2004).

Honeywell argues that BPSB cannot prevail on its

energy savings claim because BPSB must establish

both causation and damages with reasonable certainty,

which Honeywell argues is impossible without expert

testimony. Honeywell argues that BPSB's sole source

of expert analysis on damages was from Blanchette,

who 1s excluded as an expert witness per the March 24,

2008 Memorandum Ruling. Honeywell argues that

BPSB has no other competentgevidence on damages,

and points out that this Court has held that an energy

Savings analysis requires an expert qualified in M&V

who uses proper techniques and industry standards.

Honeywell also argues that BPSB cannot prove

causation, or that any increase in energy costs is

attributable to Honeywell's work and not something

else, which is another essential element of a contract

claim. Additionally Honeywell argues that BPSB must

present an expert to refute Honeywell's M&V expert,

and that a utility bill analysis 1s inappropriate ' Thus,

Honeywell argues, summary judgment 1s appropriate

because BPSB cannot raise a genuine issue of fact as to

either damages or causation, two essential elements of

its claim.

BPSB argues that 1t can prove damages based on its

utility bills, which can be introduced by fact witnesses.

BPSB argues that the contract guarantees energy

savings of $ 91,932 every year of the ten-year contract.

" BPSB seeks to produce utility bills to show that it did

not save $ 91,932 in savings each year of the contract, as

measured against the three-year average, running from

September 1, 1992 through August 31, 1995. ® BPSB

would introduce evidence that the average annual

electrnecity bills for the baseline period were §$

625,182.42, and subtracting $ 91,932 from this amount

would give a baseline cost of $ 533,24042 per year

BPSB argues that because the utility bills were hgher

than the baseline, it can satisfy its burden of proving

damages.

BPSB next argues that the burden then shifts to

Honeywell to make any adjustments it deems

"significant" and to justify those adjustments. 7! BPSB

states that the utility bills have been submitted to

Honeywell and will be introduced as exhibits at trial by

either the Superintendent, the BPSB's custodian of

records, or KPSB's Director of Fimance. * BPSB states

that the totals for each year is "just simple addition,

which does not require an expert."' * BPSB also claims

that Honeywell does not dispute that BPSB's energy

costs increased after the retrofit

Next, BPSB argues that it can use Honeywell's own

expert report to demonstrate that Honeywell did not

achieve the guaranteed savings in every year of the

10a

contract. * BPSB argues that it has not made any

significant changes that would warrant an adjustment

to the contract's energy baseline. ” Thus, BPSB argues

all it must do to recover is present the utility bills to

show the shortfall, and then the burden shifts to

Honeywell to refute BPSB's evidence and explain why

the utility bills need to be adjusted.

BPSB further argues that Honeywell admits tt failed to

install much of the contracted-for equipment, *° and that

Honeywell's failure to perform its contractual

obhgations and knowingly trying to conceal its breach

is bad faith. Thus, BPSB argues that its bad faith claim

should proceed because 1t was not waived, and bad faith

is an issue of fact that 1s not appropnate for summary

jyudgment.

BPSB also argues that the contract provided

Honeywell's annual training and audits would save

BSB $ 19,000 for each year of the contract. 7” BPSB

further argues that it 1s not required to present expert

testimony for its damages claim because Honeywell

admits it did not provide these services, and

accordingly, a jury could find for BPSB on this claim.

In Reply, Honeywell argues that BPSB erroneously

characterizes the contract's guarantee. The contract

does not promise that BPSB's utility bills will decrease

no matter what; the contract promises that the

equipment Honeywell installs will save a specified

amount of energy over a ten-year period. Thus,

Honeywell argues that a mere increase in total utility

costs, standing alone, docs not prove damages.

Honeywell also argues that BPSB's arguments

regarding Bradford's expert opinion are inadmissible

hearsay and were not incorporated in Bradford's expert

lla

report Honeywell notes that BPSB does not cite to

Bradford's deposition testimony or expert report, but

instead cites to notes that Bradford made during

Blanchette's deposition that paraphrase Blanchette's

now excluded testimony and 1s thus misleading. Finally,

Honeywell argues that BPSB's contention that BPSB is

entitled to $ 19,000 annual operational savings from

training and auditing is fabricated, since there is no

evidence that $ 19,000 in savings was to come from

these services.

The plaintiff bears the burden of proof to show damages

suffered as a result of breach of contract. Napasco Intl

Inc v Tymshare, Inc , 556 F. Supp. 654, 661 (E.D. La

1983). This Court rejects BPSB's argument that BPSB

only needs to present utility bills to show a shortfall

between the baseline calculations and the subsequent

years, and then the burden shifts to Honeywell to prove

any adjustments. The contract provides that BPSB

shall provide Honeywell with the utility bills on a

monthly basis, including any changes to energy-

operating equipment, and Honeywell would then

perform calculations to assess the program's ongoing

effectiveness * The contract places the burden on

BPSB to inform Honeywell of the addition of 1tems such

as computers or vending machines, which would alter

the baseline measurement. *” Nowhere 1n the contract 1s

Honeywell required to prove any adjustments. Thus,

without anything providing otherwise in the contract,

BPSB, as the plaintiff, has the burden of proving

damages

A plaintiff cannot prove damages by speculation

Napasco, 556 F. Supp. at 662. BPSB cannot prove

damages by calling a fact witness to introduce utility

bills. Damages in this case are not a matter of "just

l2a

simple addition," as BPSB argues. This Court has

already held that a utthty bill analysis performed by an

expert 1S an inappropriate methodology to prove

damages 1n this case, especially where the analysis does

not account for any variables. * It logically follows that

using a fact witness to introduce utihty bills from each

year without accounting for any variables ts also

insufficient to prove damages.

BPSB also cannot satisfy its burden of proving

damages through Honeywell's expert witness, as BPSB

cites to Bradford's notes that were apparently taken

during Blanchette's deposition, rather than Bradford's

own deposition testimony or Bradford's expert report.

41. BPSB provides no foundation for Bradford's

handwnitten notes, and the notes alone are insufficient.

Moreover, BPSB has not presented competent

summary judgment that there is a genuine issue of

material fact as to its damages BPSB hired Blanchette

to "analyze the performance-guarantee contract. . with

Honeywell, to determine if BPSB had any damages and

to quantify BPSB's damages, if any." * BPSB's Rule

30(b)(6) witness deferred to BPSB's expert on how to

calculate energy savings, stating that "somebody that's

skilled nm this would know what to do-I'm not" *

Because having a fact witness introduce utility bills is

not adequate to prove damages, BPSB cannot prove an

essential element of its case and summary Judgment 1s

appropriate

BPSB's claim that it does not require any evidence to

recover $ 19,000 per year due to Honeywell's alleged

failure to train and audit is mistaken The contract

states that BPSB will receive a $ 19,000 savings that 1s

a transfer from operational savings. “ There 1s no

indication this $ 19,000 1s linked to a failure to train and

l3a

audit Similarly, BPSB presents no competent summary

judgment evidence on the issue of bad faith BPSB

alludes to "fact testimony and Honeywell's own internal

emails" that show Honeywell attempted to conceal the

fact that it did not install equipment it was required to

install, and states that BPSB does not need an expert to

prove bad faith BPSB fails to produce any of this fact

testimony or internal e-mails. Because BPSB has failed

to demonstrate by competent summary judgment

evidence that there is a triable issue of fact as to

Honeywell's bad faith or the loss of $ 19,000 per year,

these claims are likewise dismissed

2) Lighting Installation

BPSB argues that the lighting retrofit was improperly

performed. Honeywell argues that because BPSB

accepted and paid for the hghting retrofit in 1996 that

BPSB may not now argue for a new lighting retrofit. It

is undisputed that BPSB paid for the lighting retrofit in

full in 1996.

[W]hen the obligor is bound to dehver a

specified and individuahzed thing, his

performance will not extinguish the obligation

unless he delivers that thing... Nevertheless,

the obhgor may give a different thing if the

obhgee consents to receive it in performance of

the obligation This is the case of a the giving in

payment, which is actually an agreement

between obligor and obligee to extinguish the

Obhgation through the rendering of a

performance different from that orginally

contemplated.

l4a

5 LA. CIV. L. TREATISE § 13.12 (2006-07) (citing LA.

CIV. CODE ANN, arts 2655 & 2659). ” "The

acceptance of a work without objection, protest or

complaint respecting the manner of performance,

estops the owner from recovery of damages resulting

from defective work, However, acceptance with the

understanding that certain defects will be remedied

does not bar recovery for the cost of remedying such

defects." Brouillette v Consol Constr Co. of Florida,

Inc., 422 So. 2d 176, 177 (La. Ct. App. 1982)

Furthermore, an owner 1s barred from recovering the

cost of the work if the work was accepted "despite the

patent defects or imperfections discoverable upon

reasonable inspection" Larkins v Cage Contractors,

Inc , 580 So 2d 1068, 1069 (La. App. 4th Cir. 1991).

Thus, whether BPSB has a claim against Honeywell

depends on whether there 1s at least a triable issue of

fact that BPSB accepted the work with the

understanding that certain defects would later be

remedied

Honeywell argues that BPSB is estopped from now

claming damages arising from the hghting retrofit

because BPSB accepted and paid for the lhghting

retrofit without protest. ® Moreover, Honeywell notes

that this Court dismissed BPSB's claim for replacement

Trane chillers because BPSB accepted and paid for

McQuay chillers without protesting their installation in

1996, which 1s the same rationale Honeywell presents

here *

BPSB argues that although it paid Honeywell in full,

BPSB did not accept Honeywell's installation of the

hghting retrofit. BPSB notes that Honeywell continued

to install and replace ballasts after the last payment. “

BPSB also argues that Honeywell's internal documents

15a

required Honeywell to obtain a signed acceptance,

which Honeywell never attempted to procure * BPSB

states several instances where the hghting retrofit that

was installed does not comport with the lhghting for

which BPSB contracted Based on these claims, BPSB

argues that a jury could easily find that every single

ballast Honeywell installed needs to be replaced even

without expert testimony.

In Reply, Honeywell argues that BPSB cites to

unidentified documents, and presents no testimony, lay

or expert, about the documents or any alleged

deficiencies, yet argues that a jury could find for BPSB

Moreover, Honeywell notes that BPSB_ withheld

Honeywell's final payment, due in August 1996, until

November 1996, when the Board voted unanimously

and without protest to release the funds to Honeywell

“© Honeywell also distingmshes BPSB's routine

maintenance pursuant to the parties' service agreement

from the onginal installation work completed in 1996,

and argues that performing routine maintenance does

not indicate that the ecriginal work was not accepted

Honeywell also rejects BPSB's argument that none of

the Honeywell performance failures would be apparent

to a layperson, such as a BPSB maintenance employee.

Honeywell argues that the lhghting installation was

open, obvious, and observed daily by building

occupants, and that BPSB had ample time in which to

inspect the equipment before rendering final payment.

Honeywell alternatively argues that if the non-

conformities were not apparent to a layperson then

BPSB would require an expert to prove its claim, which

it does not have.

l6a

The contract provides that "the warranty effective date

is the date of the Customer acceptance, the date the job

is finaled, or the date the Customer begins to receive

beneficial use of the product, whichever comes first. *!

The contract also provides that the maintenance

agreement start date occurs at the acceptance of

retrofit services “” Nothing in the contract requires

Honeywell to obtain written acceptance from BPSB.

The contract 1s fully integrated, and as such, this Court

will not look beyond the contract to determine the

parties' obligations. Because the contract did not

require Honeywell to obtain BPSB's’ written

acceptance, there is no requirement that Honeywell do

so. Accordingly, BPSB's deposition testimony is

inadmissable because it seeks to impose responsibilities

on Honeywell that are not 1n the contract.

BPSB's sole document it proffers to show that the

hghting installed was not the hghting contracted for 1s

one page from a catalog. ** BPSB does not provide any

foundation or testimonial evidence for this catalog, and

the catalog, without further explanation, 1s insufficient

to prove that the hghting installed did not conform to

the contract's specifications. Thus, BPSB did not

present competent summary judgment evidence that 1t

paid for the hghting retrofit with protest or with the

understanding that certain defects would be remedied

There 1s no tnable issue of fact as to whether the

hyhting retrofit was properly installed; accordingly,

IT IS ORDERED that Honeywell's Motion for

Summary Judgment [doc. 139]1s hereby GRANTED,

IT IS FURTHER ORDERED that this case 1s hereby

DISMISSED in tts entirety.

lva

Lake Charles, Louisiana, this day of 28 day of May,

2008.

/s/ Patriaa Minaldi

PATRICIA MINALDI

UNITED STATES DISTRICT JUDGE

1 Def 's Ex. 6 (BPSB-Honeywell contract).

2lId at 19.

3 Id at 26.

4 Id at 27-28.

5 Def.'s Ex. 10, p. 221.

6 Id

7 Id. The Court noted that the waiver was enforceable

except as to damages ansing out of bad faith or

intentional misconduct. Jd.

8 Mem. Ruling (Sept. 24, 2007) [doc. 95].

9 Mem. Ruling (March 24, 2008) [doc. 134].

10 Id

11 /d at 5-7.

12 Id

18a

13 See Mem Ruling (Sept. 24, 2007) [doc. 95| Like the

integration clause in Condrey, BPSB-Honeywell

contract states:

[t]his guarantee represents the entire

agreement between Honeywell and the Chent

with regard to the energy and operational

guarantee. This guarantee does not include any

documents, materials, commitments,

representations or comments that are not

expressly incorporated by reference into this

guarantee. The parties agree that this guarantee

describes the full and complete agreement with

respect to such guarantee and that there are no

other agreements relating to or modifying this

provision..

Def.'s Ex. 6 (BSBP-Honeywell contract)

14 Def.'s Ex. 6 (BPSB-Honeywell contract)

Furthermore, Blanchette admitted that the contract

does not require annual construction advice, but he felt

this requirement should have been part of the contract.

Def.'s Ex. 16 (Blanchette Aff pp 253-54)

15 Def.'s Ex 6 (BPSB-Honeywell contract).

16 Jd Blanchette based this claim on his behef that

negotiations surrounding the Furst Street School should

have been incorporated in the contract. Def's Ex 16

(Blanchette Aff, pp 214-15).

17 Pl.'s Ex. 20.

18 Bradford Aff., pp 8-22 [doe 112-9]

19a

19 Pl.'s Ex. 1, p 32 (BPSB-Honeywell contract)

20 Id at 18.

21 Pl.'s Ex. 1, pp. 20, 23 (BPSB-Honeywell contract).

22 BPSB summarizes its actual costs for each year, the

baseline amount, and the savings that it argues were

not achieved. Pl.'s Mem. 1n Opposition to Def.'s Mot. for

Summary Judgment, at 3. BPSB argues that the total

savings not achieved 1s $ 1,755,641 72. Jd

23 Pl.'s Mem. in Opposition to Def's Mot for Summary

Judgment, at 4.

24 Pi's Ex. 3, p 4 (Jim Bradford Expert Report).

25 See Pl.'s Mem. in Opposition to Def.'s Mot. for

Summary Judgment, at 9-11.

26 BPSRB cites no evidence for this proposition

27 Pi's Ex. 1, pp. 18, 82 (BPSB-Honeywell contract). In

fact, the contract states that BPSB will save $ 19,000 as

a transfer from operational savings, and makes no

mention of savings from annual training and audits. /d

at 32.

28 Id at 20, 24

29 Id at 24.

30 Mem. Ruling (March 24, 2008) [doe 134]

31 Pl.'s Ex 10,

20a

32 Blanchette Aff. P 2 [doc 127-7}.

33 Def.'s Ex 14, pp. 14-16.

34 Pl.'s Ex. 1, p. 32 (RPSB-Honeywell contract).

30 Article 2655 states, "Giving in payment 1s a contract

whereby an obligor gives a thing to the obligee, who

accepts it in payment of a debt" Article 2659 explains,

"The giving in payment 1s governed by the rules of the

contract of sale, with the differences provided for in this

Chapter."

36 Def.'s Ex. 10, P. 221.

37 Mem. Ruling (Sept 24, 2007) [doc. 97].

38 Pl ‘s Ex. 17.

39 Pl.'s Ex. 19, pp. 62-64 (Chris Pieper Dep.)

40 Def's Ex 10.

41 Def.’s Ex. 6.

42 Id

43 Pl.'s Ex 20

Zla

Filed 5/20/2008

DOCKET NO. 2:05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY.

ORDER GRANTING HONEYWELL'S EX PARTE

MOTION TO EXTEND CERTAIN PRETRIAL

DEADLINES

This matter came before the Court on a motion by

Defendant Honeywell International Ine. for an

extension of certain pretrial deadlines The Court,

having considered the submissions of the parties, and

being otherwise advised, enters the following order:

1. Honeywell's Ex Parte Motion to Extend Certain

Pretrial Deadlines 1s hereby granted

2. The following deadlines 1n Section I of the Court's

Standing Order Governing Pretrial Procedure issued 1n

this ease are hereby reset and/or extended as follows.

e Motions in limine, Daubert motions, other

evidentiary motions, "may call" witness lists,

exhibit lists, and pretrial statements (excluding a

22a

list of “‘will call" witnesses) shall be filed on, or

before, May 30, 2008,

e "Will call" witness lists, real time glossary, jury

instructions, verdict forms, and objections to the

authenticity and admissibihty of exhibits shall be

filed on, or before, June 9, 2008,

3. All other pretrial deadlines and the trial date in this

case will remain unchanged.

23a

Filed 3/24/2008

DOCKET NO. 2 05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY

ORDER

Before the court 1s a motion to Exclude Expert

Testimony of Lawrence W. Blanchette, [doe 112}, filed

by the defendant Honeywell, Inc _ (hereinafter

"Honeywell"), Although the plaintiff, Beauregard

Parish School Board (hereinafter "BPSB" ), did file an

Opposition, the Motion 1s considered unopposed due to

its untimely filmg For the reasons stated in the

accompanying Memorandum Ruling,

IT IS ORDERED that Honeywell's Motion to Exclude

Expert Testimony of Lawrence W Blanchette, [doc

112], is hereby GRANTED, and Blanchette's expert

testimony shall be excluded in its entirety.

24a

Filed 3/24/2008

DOCKET NO. 2.05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY

MEMORANDUM RULING

Before the court 1s a Motion to Exclude Expert

Testimony of Lawrence W. Blanchette, [doc. 112], filed

by the defendant Honeywell, Inc (hereimafter

“Honeywell”). Although the plaintiff. Beauregard

Parish School] Board (hereinafter “BPSB”), did file an

Opposition, the Motion 1s considered unopposed due to

its untimely filing.!

FACTS

The September 24, 2007 Memorandum’ Ruling

thoroughly summarizes the underlying dispute between

the parties. On September 24, 2007, this court graited

partial summary judgment in favor of Honeywell, and

dismissed Beauregard’s extra contractual claims, which

included a claim arising under the Louisiana Unfair

Trade Practices and Consumer Protection Law, a

misrepresentation claim, an unjust enrichment claim, a

detrimental relance claim, and a claim for new Trane

20a

chillers * This court also held that the contract’s

consequential damage warver clause was enforceable ‘

The parties will start a two-week bench trial on June

16, 2008.

FEDERAL RULE OF EVIDENCE 702

FED. R. EVID 702 provides that:

If scientific, technical, or other specialized

knowledge will assist the trier of fact to

understand the evidence or to determine a fact in

issue, a witness qualified as an expert by

knowledge, skill, experience, training, or

education, may testify thereto m the form of an

opinion or otherwise, if (1)the testimony is based

on sufficient facts or data, (2) the testimony 1s

the product of relable principles and methods,

and (3) the witness has applied the principles and

methods rehably to the facts of the case

In Daubert v Merreil Dow Pharmaceuticals, Ine., 509

U.S 579 (1993), the Supreme Court tasked the federal

district courts with a gatekeeper function to keep

unreliable expert testimony out of evidence. 509 US at

589 The Daubert Court articulated a non-exclusive and

non-dispositive checkhst for federal district courts to

use when assessing the reliability of expert testimony

Id. This gate-keeping function extends to all expert

testimony. Kumho Tire Co. v. Carmichael, 526 U.S 137,

147 (1999) Trial judges have “considerable leeway

in. determining whether particular expert testimony 1s

reliable” Id. at 155 “Both the determimation of

rehability and the factors taken into account are left to

the discretion of the district court consistent with its

26a

gatekeeping funcuion under FED R. EVID 702”

Munoz v Orr, 200 F.3d 291, 301-02 (5th Cir 2000)

ANALYSIS

Honeywell argues that this court should exclude

Blanchette’s testimony 1n its entirety for five reasons.

First, Honeywell argues that Blanchette’s energy

savings analysis 1s unreliable because he 1s not an

expert, his methodology does not meet industry

standards, his calculations lack a foundation, and are

contrary to the laws of physics. Second, Honeywell

argues that Blanchette impermissibly offers legal

conclusions. Third, Honeywell argues that Blanchette

cannot testify about the parties’ state of mind or

subjective intentions. Fourth, Honeywell argues that

Blanchette’s cpinions about the hghting scope should be

excluded because they interpret the contract and are

premised on parol evidence. Fifth, Honeywell argues

that there is no legal or factual basis for Blanchette’s

opinions about training, missing energy-saving

opportunities, or a refund of service fees.

I.) Blanchette’s Qualification as an Expert Witness.

Blanchette’s Methodology, Foundation for Blanchette’s

Data, and the Laws of Physics

A.) Expert Qualification

Fixpert status can arise from formal credentials as well

us experience with a particular topic. Christopher Serv.

Alhed-Signal Corp , 939 F.2d 1106, 1110 (5th Cir. 1991)

(en banc). At the Daubert hearing, “the only question

for the trial court 1s whether the expert 1s generally

qualified to render an opinion on the question in issue.”

27a

Id An expert can gain the requisite knowledge or skill

from training or education, or from hands-on

experience. Sullivan v Rowan Co., 952 I 2d 141, 145

(5th Cir. 1992). “A trial judge has wide discretion to

admit c. exclude expert testimony” Id at 144. In

Sullivan, the Fifth Cirewt upheld a trial court’s

rejection of a scientist as a metallurgical expert

witness. Id. at 145. The trial court found that although

the scientist, tramed in muicrofossils and _ not

engineering, performed over 1,000 projects involving

metal failure and attended a three-day metallurgical

seminar, the scientist still needed additional training or

experience in the metallurgical field before the scientist

could render an expert opinion. Id

Blanchette 1s a licensed mechanical engineer, but has

not had any course work or forma! training 1n the field

of measurement and verification savings (hereinafter

“M&V”).° Blanchette had never performed an M&V

analysis himself on an initial basis to reconcile energy

Savings on an annual basis.° In fact, Blanchette initially

hired ABRAXAS to perform the analysis for him, using

theMetrix system, because Blanchette did not know

how to operate Metnx.’ When ABRAXAS concluded

that the data Blanchette provided was “of inconsistent

quality,” Blancherte instructed ABRAXAS to use an

artificially low temperature balance point to alter the

results *° ABRAXAS did as instructed, but issued a

disclammer stating that “the balance point was

inappropriate for the fit which existed between

weather and utility bills,” and that this second round

ofsavings numbers “should be treated with far less

confidence” than the first set of savings numbers *

Furthermore, Blanchette has never pubhshed

orwritten any materials on anything other than air

28a

quality.’ Blanchette has also never testified as an

expert, in any field, pnor to this htigation."

Blanchette 1s not quahfied to render expert testimony

in the M&V field. He lacks formal training in MGV, and

has never published or testified in the field Although

experts may also gain expenence through mforma)

training, Blanchette has not done so. Blanchette has

never performed an M&V analysis himself and did not

know how to use the Metrix system and had to hire an

outside firm to perform the analysis '"* Thus, Blanchette

lacks the qualifications to testify as an expert in M&V

B.) Methodology

District courts may also consider the Daubert factors

by examming the expert’s methodology. Kumho, 526

US. at 153 “This determination of rehability includes a

preliminary assessment of whether the reasoning or

methodology underlying the testimony 1s scientifically

vahd and of whether that reasoning or methodology

properly can be apphed to the facts in issue.” Daubert,

509 U.S. at 592.

There are three industry standards guidelines for

M&V: the IPMVP, FEMP, and ASHRAE 14

guidelines.'* Under the IPMVPI’, there are four possible

approaches to an M&V analysis. 1.) stipulated savings,

which focuses on verifying that the measures are

properly installed and have the capacity to save the

contracted levels of energy; 2.) measure isolation, which

employs engineering calculations and site

measurements to confirm the savings resulting from

specific measures; 3.) whole-bwlding evaluation, which

most often performs a utility bill analysis to evaluate

29a

savings, and 4) simulation, which uses computer

energy models to compute savings as a function of the

important independent vanables

Blanchette performed a whole-building analysis based

on utility bills '° Honeywell argues that the whole-

building analysis was inappropriate because this option

is not recommended when savings are a_ small

percentage of district-wide savings.'* Honeywell argues

that any savings generated by the retrofit would be

masked by the hundreds of other factors that affect

energy use, such as weather, hours of operation,

changes in building use or occupancy, temperature

settings at the schools, changes im utility rates, and

reimbursement of utility costs)? Honeywell notes that

Blanchette simply ignored cach of these factors as if no

changes occurred. Blanchette states that the baseline

adjustments were ten years old and undocumented,

calling Lhem “educated guess([es].”'®

“Weather is often the most important independent

variable, affecting most of the systems covered under

ths guideline.” Initially, Blanchette attempted to

account for weather by employing ABRAXAS to

perform the analysis, but when that analysis failed,

Blanchette abandoned the weather variations in his

final report.” Computers are also an important variable

because they generate additional heat and thus require

more aw conditioning.’”' Although Blanchette admits

that BPSB added aw conditioner umts for its

newcomputer labs, which would increase energy

consumption, he did not adjust for these vanables

because BPS did not provide him with the bills he

requested to perform this analysis”** Moreover,

Honeywel! argues that Blanchette failed to verify his

30a

adjustments or compare his results against BPSB’s

actual utility bills, stating such a comparison 1s

impossible because there are “100 things consuming

energy in that building.”*’ Blanchette further noted that

the data is an “assumption” and that the baseline

adjustments are all “theoretical.”

Thus, Honeywell argues that Blanchette’s analysis does

not employ proper methodology. and violates “most or

all of the gundelines presented in all of the nationally

recognized M&V guidelines.”” This court agrees that

Blanchette’s rehance upon a utility bill analysis was the

improper approach in this case, especially since he did

not adjust for several crucial variables. Thus, this court

finds that Blanchette departed from accepted

methodology in the MGV field.

©. Foundation of Blanchette’s Data and Calculations

The district court must “ensure that an expert’s

testimony rests upon a reliable foundation ” Guillory v.

Domtar Indus., Inc., 95 F.8d 1320, 1330-31 (5th Cir.

1996) In Guillory, the Fifth Curcuit found that the

district court properly hmited Dr. Reed’s testimony

because it was based on “altered facts and speculation

designed to bolster [the defendant’s] position.” Id at

1331 (quoting the district court transcript where the

judge stated that Dr Reed’s testimony was based on a

semes of speculations of what could have happened).

Even though the court found Dr Reed made as

accurate a measurement as he could, the court

nonetheless excluded Dr. Reed’s testimony because it

was still based on speculation. Id The Fifth Circwit

noted that “expert evidence based on a fictitious set of

facts 1s Just as unrehable as evidence based upon no

gla

research at all. Both analyses result im _ pure

speculation.” Id.

Honeywell argues that Blanchette’s opmions are

speculative and should thus be excluded.” Blanchette

concedes that his calculations are “just an exercise to

come up with theoretical base line adjustments that are

not true.””’ Honeywell further argues that it is

undisputed that BPSB significantly increased the

number of computers, labs, and related equipment

during the contract period, all of which increased

BPSR’s energy expenditure, and makes a utility bill

analysis misleading. Blanchette did make adjustments

for changes in technology; however, Honeywell notes

that these adjustments were based on district-wide

estimates given to Blanchette by Dean Hieronymous, a

BPSB employee.” Blanchette did not verify or test this

data, nor does Blanchette know how Hieronymous

computed the data.” Hieronymous made _ private

handwritten notes stating, “How much 1s electricity

costing us to run the x-tra computers that were not

here when Honeywell started? We need a lower # of

hours of usage!’’*® Blanchette did not consider any

possible bias in Hieronymons’ numbers, nor could he

describe how Hieronymous. obtained his field

measurements *?

This court agrees that under Daubert and Guillory,

Blanchette’s data 1s speculative and lacks foundation.

Accordingly, his analysis is unreliable and 1s excluded

D.) Law of Physics

Honeywell also argues that Blanchette’s conclusions

are contrary to the law of physics because Blanchette

32a

admits that the measurements of light fixtures

retrofitted by Honeywell must have saved BPSB

energy., Blanchette’s calculations show that the

Honeywell retrofits increased energy usage over the

contract.’ For the reasons discussed above, this court

finds that Blanchette is not qualified as an expert in

M&V and that his energy savings analysis 1s unreliable.

II.) Legal Conclusions

Expert witnesses may not offer legal conclusions. See,

e.g., Estate of Sowell v. Umted States, 198 F.3d 169,

171-72 (5th Cir. 1999) Honeywell argues that

Blanchette impermissibly offers legal conclusions

throughout his expert report. Honeywell cites several

occurrences where Blanchette, in his Engineering

Analysis Report for BPSB, offers legal conclusions,

such as: Honeywell breached its contract,* Honeywell

acted in bad faith, * Honeywell acted fraudulently,*

Honeywell was neghgent and grossly neghgent,”

Honeywell breached a legal duty or standard of care,*

and Honeywell waived its contractual nghts *

Honeywell also argues that Blanchette offers his views

on the rights and obligations of the parties under their

contract ** Moreover, Blanchette admits that he offered

legal opmions and stated he believes he is qualified to

do so *! Because experts are not permitted to offer legal

conclusions in expert testimony, and this court finds

that Blanchette impermissibly interjected several legal

opinions and conclusions in his expert report, this court

agrees with Honeywell that these opinions must be

excluded

joa

IIT ) Parties’ State of Mind or Subjective mtentions

Courts do not permit experts to testify on the parties’

state of mind or subjective intentions. Vaulting & Cash

Serv, Inc v Diebold, Inc., No. Civ. A. 97-3686, 1998

WL 726070, ‘1 (ED La Oct 15, 1998) Honeywell

argues that Blanchette repeatedly offers his opimions

that Honeywell acted in bad faith or with the intent to

defraud.” This court agrees with Honeywell that

Blanchette impermissibly offered his opinions on

Honeywell’s subjective intentions, and thus finds these

opinions inadmissable.

IV ) Opinions About Lighting Scope

When the scope of a contract 1s clear and complete,

parol evidence is inadmissable. Condrey v. Suntrust

Bank of Ga, 429 F 3d 586, 563 (5th Cir, 2005) (applying

LA. CIV. CODE art. 1848, which bars testimonial or

other evidence to negate or vary a contract) Honeywell

argues that Blanchette impermissibly rehes upon pre-

contractual negotiations, proposals, discussions, and

other parol evidence in estimating that Honeywell

should replace hghting at a cost of $595,085."

Honeywell argues that it had several proposed

alternatives for hghting options in its negotiations with

BPSR, and that BPSB selected a less costly alternative

for the project Honeywell argues that Blanchette rehes

on some of the proposals that were not selected in

computing his damages.* To the extent that Blanchette

refers to pre-contractual negotiations, proposals,

discussions, and other parol! evidence in his expert

report, such evidence 1s nadmissable.

V) Opmnions About Training, Missed Energy-Saving

34a

Opportunities, or Refund of Service Fees Blanchette

claims that BPSB suffered a $1,736,500 claim for “lost

traimnng opportumties.”” The Honeywell-BPSB

contract called for approximately ten hours per year of

training, which was to consist of tutorials for faculty

and students and some limited equipment training for

maintenance personnel.*”® The stated cost for this

training was $4,777 for the ten-year contractual

period.” Apparently, Honeywell did not perform all of

the trainmg. In Blanchette’s report, he relies on

marketing materials from Energy Education, Inc.

(hereinafter “EEI”) to extrapolate the potential energy

savings * Blanchette states that “school board’s [sic]

similar to BPSB are saving between 22-26% of their

annual energy expenditure through training, education,

and monitoring,” and estimated the value of the

program as $1,736,500 (at a 23% savings).*”

Honeywell argues that Blanchette’s expert report has

no factual basis First, Honeywell argues that EEI’s

marketing materials are unverified, contain lhttle

information about the schools at issue, and offer no

justification for its data Honeywell further argues that

Bianchette did not investigate EEI’s claims. Further,

Honeywell argues that EEI’s traming programs are

fundamentally different than those specified in

Honeywell’s contract; namely, the EEI programs

required the school district to have ful-lime on-site

energy managers, undergo extensive training, purchase

thousands of dollars of energy tracki..g software, and

pay EEI monthly service fees ranging from $5,000 to

$9,200, whereas Honeywell’s program called for ten

hours of training per year.

Second, Honeywell argues that Blanchette’s opinions

30a

about missed hypothetical technology opportunities

should be excluded Blanchette states that Honeywell

should be hable for $470,000 in “missed technological

opportunities Honeywell argues that because nothing

in the contract required Honeywell to provide this

service, Blanchette’s opinion 1s speculative. Moreover,

Blanchette also states that Honeywell owes BPSB

$125,000 for failing to provide annual construction

advice.” Similarly, Honeywell argues that because this

service was not 1n the contract, Blanchette’s opinions

are mere speculation.

Lastly, Blanchette speculates that Honeywell should

fully refund al! service fees that BPSB paid.”

Honeywell argues that it performed preventative

maintenance and repair work, which BPSB accepted

and paid for. Honeywell thus argues Blanchette’s

opinions on service fees, missed _ technological

opportunities, and traming are biased and baseless, and

should be excluded.

This court agrees that Blanchette’s valuation of lost

training savings is baseless. The EEI program and

Honeywell’s traming program are fundamentally

different, and thus the EEI program does not provide a

good comparison This court further agrees that

Blanchette’s claims for missed _ technological

opportunities 1s speculative Furthermore, this court

finds that Blancherte does not have a factual basis for

his opinion that Honeywell should refund the service

fees.

CONCLUSION

IT IS ORDERED that Honeywell’s Motion to Exclude

06a

Expert Testimony of Lawrence W_ Blanchette 1s

hereby GRANTED, and Blanchette’s expert testimony

shall be excluded in its entirety.

Footnotes

1See Mem Order (Feb. 28, 2008) [doe. 120].

2Mem Ruling (Sept 24, 2007) [doc. 95]

3Judgment (Sept. 24, 2007) [doc. 96!

4\d.

dDef’s Ex. 5, pp. 299-306.

61d.

71d at 98.

8Def.’s Eixs. 12,14.

9Def’s Ex. 14.

10Id. at 332-34.

111d. at 331.

12 This analysis was not used for the final report. Def’s

Ex 5, p. 165.

13Def’s Ex. 7, p. 6.

141d. at 6-7.

15Def.’s Ex. 2, p. 19.

16 “This Option is intended for projects where savings

are expected to be large enough to be discernable from

the random or unexplained energy variations that are

normally found at the level of the whole facility meter.”

Def’s Ex. 8, p. 28. Moreover, this option 1s not used if

the savings are less than 10% under the IMPYP or

ASHRAE 14 models, or 20% under the FEMP

guidelines. Id at 33.

17Accounting for changes is the major challenge

associated with [a utility bill analysis], particularly for

long-term contracts.” Def.’s Ex. 9, p 20.

18Def’s Ex. 5, pp. 202-03. No one on the school board

knew to set aside the data so 1t could be addressed on

37a

an annual basis, leading Blanchette to conclude that the

baseline adjustment 1s a “guess” and “not reahty ” Id.

at 206.

19Defs Ex 10, p. 10.

20Def’s Ex. 3, pp. 26-28; Ex. 5, p 165; Ex. 7, p. 36.

21 Def’s Ex. 7, pp 36, 4 1-42

22 Def’s Ex. 5, pp. 112-14, 545-46; Ex. 18, Ex. 17.

23 Id. at 522

241d. at 528

25 Id at 35; see also id. at 3 5-37 (hsting Blanchette’s

departures from good M&V

practices)

26 Honeywell cites to several instances of Blanchette’s

speculations. For example, even afterABRAXAS told

Blanchette that the data was inherently unrehable and

of an inconsistent quality, Blanchette did not model

actual BPSB schools, but rather instructed his

assistant, Aymond, to input a senes of hypothetical

data Defs Ex 5, pp. 392-94, 496-501, 510-20 In one

mstance, Aymond assumed that every window 1n each

building was one foot square, even though Blanchette

knew this was not true. Id. at 5 13-16 Furthermore,

Blanchette instructed Aymond to assume that every

building had an air infiltration of zero, even though he

knew this was not accurate. Id. at 5 16-18. Blanchette

also speculated about pre-existing usage patterns for

the air conditioning units that Honeywell replaced, and

used this hypothetical data in his calculations, stating

“none of it 1s real.” Id at 525-28 Blanchette further

guessed about the condition and structure of the roofs

Id at 69-72, 496-500. Blanchette entirely omitted

printers, copiers, and vending machines from his

analysis. Id at 541-43 Blanchette also did not account

for changes in weekend and after-school activities, or

school schedules. Id. at 552-53

38a

Blanchette did not consider enrollment changes in

individual schools, changes in student-to-teacher ratios,

or changes 1n the number of classrooms in each school

Id. at 553-56.

27 Def’s Ex. 5, p. 528.

28ld at 267-70, 53 1-37.

29 Id.

30Def’s Ex. 18.

31Def’s Ex 5, pp. 267-68.

32 Id. at 382-85.

33Def’s Ex 2, p. 19.

34Def’s Ex. 2, pp. 2, 7, 14; Def's Ex. 3, pp 8, 11, 16.

35Def’s Ex. 2, pp. 2, 7; Def.’s Ex. 3,pp. 14, 16

36 Def’s Ex. 2, p..3, Def’s Ex. 3, pp. 14-15, 20.

37Def’s F:x.2,pp. 16, 19;Def’s Ex.3,pp. 8,11

38 Def’s Ex 2, pp 3, 7; Def’s Ex. 8, p. 23.

39Def’s Ex 2,pp. 16,21,Def’s Ex. 3, pp 11,25.

40Def’s Ex.2,pp 5-12, 15-17;Ex 3,pp 8-11,24-26

41Def’s Ex 5, pp. 127-29.

42Def’s Ex 2,pp. 13, 17,Ex.3,pp. 11-16, 19,24-25.

43See Defs' Ex.2,pp.9-12, 19,Ex 3,p.33;Ex.5,pp.60-

65,263.

44Def’s Ex. 30; Def’s Ex. 6, pp 11-17)

45Def’s Ex. 3, p. 33.

46 Def’s Ex. 6, pp. 26-28; Ex. 7, p 29.

47Def’s Ex 19.

48 Def’s Ex. 2, pp. 17-20. EEI performed energy

training for three Louisiana school districts. Id.

49Def’s Ex. 3,p. 38.

50Def’s Exs 20-23

51In Def’s Ex 2, p 19, Blanchette apparently bases this

figure off of Honeywell's

proposal stating the “intrinsic value” of Honeywell’s

advice.

52 Def’s Ex 3. p. 33.

39a

Filed 3/19/2008

DOCKET NO. 2.05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY

ORDER

Before the court is a Motion For Reconsideration and

Request for the Court to Accept a Memorandum That

Comphes With the Court’s 25-Page Limitation, [doc 121

], filed by the plaintiff, Beauregard Parish School Board

(hereinafter “BPSB”). Honeywell, Inc. (hereimafter

“Honeywell”) filed an Opposition [doc. 124] BPSB filed

a reply [doc. 129] For the reasons stated in the

accompanying Memorandum Ruling, BPSB’s Motion for

Reconsideration 1s denied; accordingly,

IT IS ORDERED that the motion for Reconsideration,

(doc. 121], filed by BPSB, 1s hereby DENIED.

40a

Filed 3/19/2008

DOCKET NO. 2:05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY

MEMORANDUM RULING

Before the court is a Motion For Reconsideration arid

Request For the Court to Accept a Memorandum That

Complies With the Court’s 25-Page Limitation, [doc.

121], filed by the plamtiff, Beauregard Parish School

Board (hereimafter “BPSB”). Honeywell, Inc

(heremafter “Honeywell”) filed an Opposition {doc. 124].

BPSB filed a Reply [doc 129] BPSB requests that this

Court reconsider its February 28, 2008 decision that

exercised its discretion to decline consideration of

BPSB’s untimely Opposition to Honeywell’s Motion to

Exclude Expert Testimony of Lawrence W. Blanchette

[doe 112]. The February 28 Memorandum Order

discusses the facts underlying the dispute in this

Motion '

Honeywell filed tts Daubert Motion on February 7, and

filed Exhibits 23-30 the following morning, on February

8.° On February 8, the Clerk’s Office issued a Notice of

4la

Motion Setting that listed Honeywell’s Daubert Motion

as being filed on February 7, and stated that “responses

to said motion are due within fifteen calendar days after

service of the motion ’’ Fifteen (15) days from February

7 was Frnday, February 22. BPSB argues that

Honeywell’s delayed filing of some exhibits pushed

back the filing date to February 8, which made the

deadline Saturday, February 238 BPSB argues that

pursuant to FED R. Civ. P. 6(1)(8), if the deadline for

filing a bref falls on a Saturday, Sunday, or legal

holiday, the deadline moves to the next business day.

Thus, BPSB argues that the deadline was actually

Monday, February 25

Honeywell’s filing of the remainder of its exhibits the

followmg day does not alter the submission date for

BPSB’s Opposition Even assuming that Honeywell's

untimely flied exhibits did push back the submission

date for BPSB’s Opposition by one clay, the deadline

would nonetheless be Saturday, February 23

Regardless of the Federal Rules and the Local Rules,

the Notice of Motion Setting issued for Honeywell's

Daubert Motion makes it clear that this Court counts

calendar days and not business days in calculating

submission deadlines. Thus, the latest possible

submission date was Saturday, February 23. Moreover,

the fact that BPSB’s counsel, Mr. Melancon, called this

Court to request an extension from Friday, February

22 to Saturday, February 23 indicates that he was

aware that his deadline was indeed Friday, February

22 Thus, Mr. Melancon’s argument that his bnef was

timely filed 1s unavailing

As stated in the Court’s February 8 Notice of Motion

Setting, “[rlesponses not timely filed may not be

42a

considered by the Court.”” Moreover, pursuant to FED

R. Civ. P 6(b), judges have the discretion to grant

leave to file an untimely bref Thus, this Court 1s wel!

within its diseretion to decline to consider BPSB’s

Opposition Moreover, Honeywell has submitted the

deposition testimony and expert report of Mr.

Blanchette, BPSB’s proposed expert witness, so the

Court finds that it has sufficient materials with which

to decide Honeywell’s Daubert Motion.

BPSB also argues that CM/ECF gave it technical

problems when it tried to file on Saturday, February

23. BPSB also argues that pursuant to LR 7.7 11W, “{a]

user whose electronic filing 1s made impossible as the

result of a technical failure in the Court’s Web Site may

seek appropriate relief’ The first indication of any

attempt to file occurred on Sunday, February 24.° As

discussed in the February 28 Memorandum Order, even

if the system prohibited Mr Melancon from filing his

Opposition on February 23, Mr Melancon should have

telephoned opposing counsel,’ and faxed a copy of his

Opposition to opposing counsel and the Court with a

letter explaimng the problem Furthermore, Mr

Melancon does not explain why Blanchette’s affidavit is

dated Monday, February 25 if he had tried to file all

ofthese documents on Saturday, February 23. Instead,

Mr. Melancon waited two days to take any remedial

acuion, including contacting the Court or opposing

counsel.

BPSB raises several arguments in its’ Reply

Memorandum. First, BPSB argues that this Court

ruled on February 28, 2008 without allowing BPSB to

present any argument. This 1s incorrect. The February

28 Memorandum Order was in response to BPSB’s

43a

Motion for Leave to File Response Memorandum in

Excess of Page Limitations, [doc 115], and, as

discussed above, this Court exercised its diseretion to

dechne consideration of an untimely filed bnef BPSB

also argues that Honeywell has a long history of making

unsupportable allegations, misrepresenting facts, and

multiplying court proceedings, and proffers almost two

pages of examples. These discovery dispules were

either already resolved by former Magistrate Judge

Wilson, or are pending before Magistrate Judge Kay in

BPSB’s Motion for Sanctions, and are thus not

appropriate for this Court to consider.

BPSB also argues that Honeywell failed to show how it

was prejudiced by a 39-page memorandum or by an

alternative 25-page memorandum. Honeywell need not

demonstrate prejudice for this Court to declme

consideration of an untimely filed bref; the Notice of

Motion Setting states, “[r]esponses not timely filed may

not be considered by the Court.”* BPSB also argues

that Honeywell makes numerous, unsupported

allegations, such as “if the Court had not rejected

BPSB’s untimely, overlength filmg, Honeywell would

have moved to strike because the contents are

improper.” This argument 1s irrelevant because BPSB’s

Opposition was not timely filed and thus this Court was

well within its discretion not to consider BPSB’s bref.

Lastly, BPSB argues that this Court 1s somehow

invoking its inherent authority to sanction BPSB and

strike its Daubert Opposition, which is 1mpermissible

viven a distnmet court’s limited ability to sanction

Refusing to consider a brief that does not comport with

this Court’s deadlines 1s not a sanction. The efficiency of

our legal system depends on comphance with rules and

44a

deadlines. When parties depart from deadlines, they

must file leave of court, and such departures are

governed by the judge’s discretion FED. R Civ, P.

6(b). Moreover, the Notice of Motion Setting for the

Daubert Motion states, “|rJesponses not timely filed

may not be considered by the Court ”® Exercising the

diseretion to not consider an untimely filed response 1s

simply not a sanction.'"° Had BPSB comphed with the

rules and deadlines governing the submission of its

response, this Court would have gladly considered its

Opposition.

Tms Court would have been inclined to consider an

Opposition that was untimely filed on the CM/ECF

system had BPSB made good faith efforts to comply

with the spimt of the deadline by promptly contacting

opposing counsel and the Court on Saturday, and

submitting copies of his Opposition via facsimile by the

5 pm deadhne As it 1s, there was no contact with the

Court or opposing counsel until Monday, February 25,

one of BPSB’s affidavits was not signed until February

25, and the proposed Opposition with the Motion for

Leave to File Page Extension was not attached to

BPSB’s February 24 filing; accordingly,

IT IS ORDERED that the Motion for Reconsideration,

{doe. 121], filed by BPSB, 1s hereby DENIED

Footnotes

1 See Mem Order (Feb 28, 2008) [doc. 120}.

2See does 112, 113.

3Notice of Motion Setting (Feb. 8, 2008) [doe. 122].

4BPSB filed this suit on July 28, 2005, and this Court

has ruled on several motions with deadlines that were

45a

set using the same calendar method as was used for

Honeywell’s Daubert Motion These motions were set

with a Notice of Motion setting, which appears in the

docket and specifically refers to “calendar days” as

determining the submission date. By now, both parties

should be well aware that this Court departs from the

Federal and Local Rules in determining submission

dates by using a calendar method.

5Notice of Motion Setting (Feb 8, 2008) [doc. 114].

6 Pl.’s Ex. 7 (Feb 24, 2008) [doe. 121]

7Mr Lindemann, Honeywell’s counsel, indicates that

Mr. Melancon has his cell phone number, and has

previously contacted him on that number.

8Notice of Motion Setting (Feb. 8, 2008) [doc 114]; see

alsoFED.R Civ P. 6,0).

9Notice of Motion Setting (Feb 8, 2008) [doe. 114].

10BPSB states that this Court’s decision not to

consider its untimely filed Opposition demonstrates

that the Court’s real intent is to dismiss BPSB’s lawsuit

in stages.”” BPSB Reply at 9-10 [doc. 129]. This Court’s

intent 1s to resolve all pending motions in an

expeditious fashion so this case can proceed to the two-

week trial scheduled for June 16, 2008.

46a

Filed 2/29/2008

DOCKET NO 2:05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY

MEMORANDUM ORDER

Before the court 1s a Motion for Leave to File Response

Memorandum in Excess of Page Limitations, [doc 115

], filed by Beauregard Parish School Board hereinafter

"BPSB" , in reponse to Honeywell's Daubert Motion

[doe. 112.], Honeyweil, Inc. (hereinafter "Honeywell")

filed an untimely Opposition [doc.117].

According to Honeywell, on Monday, February 18,

2008, BPSB's counsel, William Melancon, spoke with

Honeywell's counsel, Steven Lindemann, about the

Daubert Motion briefing schedule. Pursuant to the

Court's Notice of Motion Setting, BPSB's Opposition

was due by Friday, February 22, 2008. At this time, Mr

Melancon represented to Mr. Lindemann that he might

require one additional day.

On Friday, February 22, 2008, Mr. Melancon called Mr

Lindeman and stated that he would require an

47a

additional day because his secretary's fnend's mother

died and she needed to leave work immediately to

comfort her friend. Apparently Mr. Melancon would be

unable to finish and timely file his Opposition without

his secretary's assistance. Honeywell agreed to a one-

day extension, pending court approval, for BPSB's

Opposition if Honeywell could also receive a one-day

extension for its Reply. Both parties then called the

Court and spoke with Judge Minaldi's civil law clerk,

who, in Judge Minaldi's absence, issued a Minute Entry

granting both parties a one-day extension because it

was mutual and because it would net delay the

upcoming hearing. Accordingly, the court reset BPSB's

deadline for filing an Opposition at 5 p.m. on February

23, 2008.

On Saturday, February 23, at 423 p.m, Mr. Lindemann

sent Mr Melanon an e-mail inquiring as to the status of

BPSB's Opposition, and requesting Mr. Melancon e-

mail him the Opposition in the event that the court does

not send out its normal filing notice on weekends.fnl

Mr. Melancon allegedly did not respond to the e-mail.

On Sunday, February 24 at 1211 a.m., BPSB filed its

Motion for additional pages, which did not include the

proposed opposition, did not request an extension of the

filing deadline, and did not mention the untimeliness of

the filing BPSB filed the Opposition on Monday,

February 25 at 1107 am., and Mr Melancon faxed a

letter explaining the situation to Chambers at 4 51 pm

Mr. Melancon's February 25 faxed letter to the Court

states that when he attempted to file the response

memorandum and request for page extension on

Saturday, February 23, the system gave him a great

deal of problems, and the Motion for Page Exhibits was

48a

finally accepted around midnight, while the Opposition

was never accepted. Mr Melancon states that he was

concerned his computer system had contracted a virus,

and was reluctant to send anything out before speaking

with the Clerk of Court's techmcal department. Mr.

Melancon apparently spoke with Sandy at the Western

District of Louisiana help desk on Sunday, who advised

him to simply re-file The Opposition was filed on

Monday at 11:07 a.m.

Stating that "it takes many more words to defend"

against attacks on an expert witness and that the

lawsuit mvolves scientific and technical issues not

commoniy before federal courts its justification for

extra pages, BPSB requests leave to file a thirty-nine

(39) page Opposition, which well exceeds the twenty-

five (25) page limit.

Honeywell opposes BPSB's request because BPSB

missed the original deadline for filing its Opposition,

and because there is no proper justification for the

lengthy bref. Honeywell states that ordinanly the

Court (and Honeywell) may be inclined to overlook the

untimeliness of BPSB's filing, however, "that BPSB has

repeatedly disregarded the rules, taken unfair

advantage ofany reasonable accommodation, and

disregarded Court rulings." Honeywell correctly states

that throughout this case, BPSB has had six deficiency

notices, six corrective filings, four motions for excess

length briefs, five continuances of tmal dates or pre-

trial deadlines, four motions for reconsideration,

requests for interlocutory appeals or appeals from

decisions of the Magistrate Judge, fourteen hearings or

orders regarding BPSB's discovery deficiencies, two

separate lawsuits over the same subject matter-one of

49a

which was dismissed-and one pending Fifth Circuit

appeal. Honeywel! also points out that nearly eight (8)

pages of BPSB's brief "contain almost nothing but

verbatim text cut and-pasted, without attribution or

analysis, from footnotes" of FEDERAL PRACTICE &

PROCEDURE Honeywell thus requests that this

court reyect BPSB's submission as untimely and regard

Honeywell's Daubert Motion a unopposed.

This court finds it rmplausible that the Motion to File in

Excess of Page Limitations, which included two

attachments, was accepted on Sunday, yet the

Opposition was not accepted until Monday morning

Nonetheless, despite any technical errors, BPSB did

not make any effort to timely submit copies via fax or e-

mail to opposing counsel or this court. Even if BPSB

was concerned about a possible computer virus, nothing

prevented BPSB from complying with the spirit of its

deadline by faxing courtesy copies to Mr. Lindemann

and this court, especially in lght of the impending

hearing. Moreover, this court now questions the

sincerity of Mr Melancon's request for a one-day

extension due to his secretary's friend's mother's death,

as Mr. Melancon indicated earher in the weck to Mr.

Lindemann that he might need a one-day extension, the

affidavit accompanying the Opposition was not

executed until Monday, February 25, and Mr Melancon

did not file or otherwise make available his Opposition

until late Monday morning.

As Honeywell pomts out, this docket is replete with

BPSB's deficiencies, requests for extensions, motions to

file excess pages and supplemental memoranda and

even the filing of a second duplicative suit. Once again,

with its untimely Opposition, BPSB took advantage of a

50a

oneday extension, to which opposing counsel

generously agreed and this court granted trusting that

the request was made m good faith Accordingly, after

considering BPSB's Motion and Honeywell's

Opposition, and given that this case is scheduled for a

two-week trial starting June 16, 2008,

IT IS ORDERED that BPSB's Request to File a

Memorandum in Excess of the Page Limitations is

hereby DENIED,

IT IS FURTHER ORDERED that this Court shall

exercise its discretion and decline to consider BPSB's

untimely Opposition Accordingly, Honeywell's

Daubert Motion shall be considered unopposed, the

March 20, 2008 hearing 1s hereby MOOT, and this Court

shall rule solely on the Daubert Motion [doc. 112}

without any further bnefing.

5la

Filed 10/22/2007

DOCKET NO. 2 05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITEDSTATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY

MEMORANDUM ORDER

Considering the foregoing Motion for Leave to File a

Supplemental and Amending Complaint, which would

add facts pertaming to plaintiffs Louisiana Unfair

Trade Practices Act claim, in hght of this court's

Memorandum Ruling of September 24, 2007 that

dismissed the plamtiffs LUTPA claim,

IT IS ORDERED that the Plaintiff's Motion for Leave

to File a Supplemental and Amending Complaint 1s

hereby DENIED

52a

Filed 9/24/2007

DOCKET NO 2.05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE MAGISTRATE JUDGE KAY.

JUDGMENT

In accordance with the corresponding Memorandum

Ruling, for the reason set forth therein, based on the

pleadings, affidavits, and certified documents submitted

by the parties, and the undisputed facts, the Court finds

that there is no genuine issue of material fact and that

Honeywell 1s entitled to partial summary judgment as

prayed for in its motion; and accordingly:

IT IS ORDERED that the Defendant’s Motion

for Partial Summary Judgment filed on behalf

ofHonecywell Corporation 1s hereby GRANTED;

IT IS ORDERED that Plaintiffs LUTPA claim

is DISMISSED;

IT TS ORDERED that Plaintiff's detrimental

reliance claim is DISMISSED;

53a

IT IS ORDERED that Plaintiff's unjust

enrichment claim is DISMISSED;

IT IS ORDERED that Plaintiffs claim that it be

awarded new Trane chillers is DISMISSED;

IT IS FURTHER ORDERED that the

contract’s waiver of ineidental, special,

consequential, or indirect damages is enforceable

imsofar as 1t does not limit damages arising out of

Honeywell’s bad faith

54a

Filed 9/24/2007

DOCKET NO 2:05 CV 1388

UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF LOUISIANA, LAKE

CHARLES DIVISION

BEAUREGARD PARISH SCHOOL BOARD

VS.

HONEYWELL INC.

PATRICIA MINALDI, UNITED STATES

DISTRICT JUDGE. MAGISTRATE JUDGE KAY

MEMORANDUM RULING

Before the court 1s defendant Honeywell, Inc.’s Motion

for Partial Summary Judgment The plaintiff,

Beauregard Parish School Board, filed a Memorandum

in Response to Honeywell’s Motion for Partial

Summary Judgment on April 9.

FACTS

On April 24, 2006, Beauregard Parish School Board

(“BPSB”) entered into a contract with Honeywell, Inc.

(“Honeywell”) whereby Honeywell was to retrofit

heating, ventilation, and electrical systems at multiple

schools, install new chillers, replace fixtures and light

bulbs with energy efficient models, and train BPSB

employees in energy reduction and maintenance

techniques.' The purpose of the contract was to provide

operational savings to BPSB in the amount of $107,532

over a ten-year period * BPSB paid Honeywell $714,308

5da

for the retrofit, as well as monthly fees which, as of

June 2005, amounted to $97,458."

The contract also required Honeywell to perform an

annual audit of energy savings and submit a report to

BPSB for the ten-year guarantee penod.‘ Honeywell

admits that it did not perform audits for years two

through five ® In 2001, Honeywell allegedly prepared a

“catch-up” report for those years.® In December 2001,

after Honeywell delivered the catch-up reports, BPSB

allegedly expressed its dissatisfaction with the

methodology employed by Honeywell to calculate its

energy savings.’ Specifically, BPSB wanted the energy

savings to be calculated using its utility bills ®

Honeywell alleges that BPSB had not _ provided

Honeywell with its utility bills for three years and had

not given Honeywell notice of any changes to its

fanhties—including the addition of numerous

computers, portable buildings, elec —both of which a

utihty-based audit would have required.”

On January 9, 2002, Honeywell wrote to BPSB and

nullified the guarantee’"’ On May 29, 2002, BPSB

demanded that Honeywell provide a_ detailed

accounting of Honeywell’s calculations to support the

audit reports for years one through five.’! In August

2002, the parties convened a conference call to discuss

various matters.'* On July 11, 2005 BPSB filed suit in

the 36" District, Parish of Beauregard.

Honeywell now moves for partial summary judgment

on Beauregard’s extracontractual claims, which include:

a clam arising under the Lowsiana Unfair Trade

Practices and Consumer Protection Law (LUTPA), a

nusrepresentation claim, an unjust enrichment claim, a

56a

detrimental reliance claim, and a clam for newTrane

chillers. Honeywell also asks this court to enforce the

contract’s consequential damage waiver clause

SUMMARY JUDGMENT STANDARD

A court should grant a motion for summary judgment

when the file, including the opposing party’s affidavits,

demonstrates that “there 1s no genuine issue of material

fact and that the moving party ts entitled to a judgment

as a matter of law” FED. R. Civ P 56(c); Celotex

Corp. v. Catrett, 477 U.S. 317, 823-24 (1986) The party

moving for summary judgment 1s initially responsible

for demonstrating the reasons justifying the motion for

summary Judgment by identifying portions of pleadings

and discovery that demonstrate the lack of a genuine

issue of material fact for tral. Tubacex, Inc v. M/V

Risan, 45 F.3d 951, 954 (5th Cir. 1995) The court must

deny the moving party’s motion for summary judgment

if the movant fails to meet this burden. Id.

If the movant satisfies this burden, however, the

nonmoving party must “designate specific facts

showing that there 1s a genuine issue for trial.” Id. In

evaluating motions for summary Judgment, the court

must view all facts in the light most favorable to the

nonmoving party.

Matsushita Elec Indus. Co v Zenith Radio Corp , 475

US 574, 587 (1975). There 1s no genuine issue for trial,

and thus a grant of summary judgment 1s warranted,

when the record as a whole “could not lead a rational

finder of fact to find for the non-moving party .” Id.

ANALYSIS

57a

A Louisiana Unfair Trade Practices & Consumer

Protection Law

BPSB alleges a violation of the Lousiana Unfair Trade

Practices and Consumer Protection Law (LUTPA). LA

REV. STAT. ANN’ § 51:1401, et seq. LUTPA

proscribes ‘“{u]nfair methods of competition and unfair

or deceptive acts or practices in the conduct of any

trade or commerce. This legislation is broadly and

subjectively stated and does not specify particular

violations. Rather, what constitutes an unfair trade

practice 1s determined by the courts on a case-by-case

basis” Levine v. First Nat Bank of Commerce, 948

So.2d 1051, 1065 (La. 2006)(citing Farrell v. Carter, 577

So 2d 120, 128 (La. App. 1 Cur. 1991)). “{I]t has been

stated that a practice 1s unfair when it offends

established public policy and when the practice 1s

unethical, oppressive, unscrupulous, or substantially

injurious to consumers and consumers include business

competitors.” Roustabouts, Inc. v Hamer, 447 So 2d

543,548 (La App. 1 Cir 1984).

BPSB does not have a viable claim under LUTPA *

“Where the plaintiffs are not in competition with the

defendants, it appears that most courts treat the claim

as a breach of contract clam, which 1s not actionable

under LUTPA ” Landreneau v Fleet Financial Group,

197 F Supp 2d 551, 557 (MD.La. 2002). The Fifth

Cireuit has repeatedly recogmzed that “the statute

does not provide an alternate remedy for simple

breaches of contract... There is a great deal of daylight

between a breach of contract clam and the egregious

behavior the statute proscnibes” Turner v. Purina

Mills, Inc., 989 F.2d 1419, 1422 (5th Cir 1998) (citation

omitted). Because the dispute between BPSB and

58a

Honeywell is a breach of contract claim, BPSB’s

LUTPA claim is not actionable

B. Detrimental Rehance

Honeywell argues that BPSB’s detrimental reliance

clazm must fail because (1) BPSB cannot identify an

extra-contractual representation, and (2) any reliance

upon extra-contractual representations 1s unreasonable

as a matter of law in view of the written, executed

contract between the parties. BPSB does not offer any

legal arguments on this issue, but suggests that

dismissal of this claim 1s premature because the jury

should be free to find for BPSB on any of several

alternate theories.

The theory of detrimental rehance provides: “A party

may be obhgated by a promise when he knew or should

have known that the promise would induce the other

party to rely on it to his detriment and the other party

was reasonable in so relying” LA. Civ. CODE ANN.

art. 1967.

“The doctrine of detrimental reliance 1s designed to

prevent injustice by barmng a party from taking a

position contrary to his prior acts, admissions,

representations, or silence.” In re Ark-La-Tex Timber

Co., Inc, 482 F 3d 319 (Sth Cir. 2007) (citing May v.

Harns Management Corp , 2004-2657 (La. App I Cir

12/22/05); 928 So 2d 140, 145). “The doctrine usually

functions when no written contract or an unenforceable

contract exists between the parties.” Drs Bethea,

Moustoukas and Weaver LLC vy. St Paul Guardian Ins.

Co., 376 F 3d 399, 408 (Sth Cir. 2004)(citing Jackson v.

Lare, 34-124 (La. App 2 Cir. 11/1/2000); 779 So.2d 808,

814 nl).

To recover under article 1967, a party must prove (1) a

representation by conduct or word, (2) made in such a

manner that the promisor should have expected the

promisee to rely upon it; (3) justifiable reliance by the

promisee; and, (4) a change in position to the promisee’s

detriment because of the relhance. In re Ark-La-Tex

Timber Co., Inc, 482 F 8d at 334 (ating Sure v.

Lafayette City-Parish Consol Government, 907 So.2d

37, 59 (La. 2005)). The Fifth Circuit recently stated that

“fijt is difficult to recover under the theory of

detrimental reliance, because such a claim is_ not

favored in Louisiana.” Id.

Moreover, “Loutsiana law recognizes certain situations

where a plaintiff's reliance on a promise 1s unreasonable

as a matter of law.” Bethea, 376 F3d at 403. An

example of such a situation 1s where a party relies upon

promises made outside of an unambiguous, fully-

integrated agreement Id at 403-04 “Many courts have

found a plaintiffs reliance to be unreasonable as a

matter of law when the parties have a valid contract

defining thei nghts and hmting the ways in which the

contract may be modified.” Id. at 404. Here, because

there exists a fully integrated contract between BPSB

and Honeywell, and because BPSB has failed to identify

an extra-contractual “representation by conduct or

word,” BPSB’s detrimental reliance claim 1s dismissed

C Unjust Enrichment

Honeywell argues that in order to maintain an unjust

enrichment claim, the plaintiff must have no other

available remedy at law. Honeywell avers that because

60a

BPSB has asserted a claim for breach of contract, it has

another available remedy

The doctrine of unjust enrichment 1s codified by

Louisiana Civil Code article 2298, which provides:

A person who has been enriched without cause at

the expense of another person is bound to

compensate that person. The term “without

cause” 1s used 1n this context to exclude cases in

which the enrichment results from a_ valid

juridical act or the law. The remedy declared

here 1s subsidiary and shall not be available if the

law provides another remedy for’ the

impoverishment or declares a contrary rule.

LA. Civ. CODE ANN. art. 2298 A party seeking to

recover pursuant to the theory of unjust enmchment

bears the burden of proving five elements: (1) an

enrichment; (2) an impoverishment; (3) a connection

between the enrichment and_ the _ resulting

impoverishment; (4) an absence of ‘Sjustification” or

“cause” for the enrichment and impoverishment, and,

(5) no other remedy at law available to plaintiff Moroux

v. Toce, 2006-831 (La. App 3 Cur 11/2/06), 9438 So.2d

1263, Baker v Maclay Properties Co., 2006-1000 (La.

App. 1 Cir. 5/4/07), 2007 WL 1300820, * 1; see also LA.

Civ CODE Arm~ art. 2298 A plaintiff has the burden

of proving each element of unjust enrichment by a

preponderance of the evidence. Tandy v. Pecan Shoppe

of Minden, Inc., 34-578 (La. App. 2 Cir 4/1/01); 785

So.2d 111, 117.

Here, BPSB’s claims for breach of contract survive

summary Judgment. BPSB and Honeywell have a valid,

6la

binding contract, and BPSB has a remedy available at

law via its breach of contract claims, Accordingly,

BPSB’s unjust enrichment claim js dismissed.

D Negligent Misrepresentation

Honeywell argues that a neghgent misrepresentation

claim" is delictual and therefore subject to a one-year

prescriptive period. Honeywell avers that BPSB's

neghgent misrepresentation claim “accrued no later

than January 9, 2002, when Honeywell nullified the

guarantee.” BPSB filed suit on July 11, 2005; thus,

Honeywell asserts that any claim for negligent

misrepresentation has prescribed.

“A person commits the tort of neghgent

misrepresentation when (1) he has a legal duty to

supply correct information; (2) he breaches that duty;

and, (3) his breach causes damages to the plaintiff

Society of Roman Catholic Church of Diocese of

Lafayette, Inc. v. Interstate Fire & Cas. Co, 126 F.8d

727, 742 (5th Cir. 1997) (citing Barne v. VP.

Exterminators, Inc., 625 So 2d 1007 (La.1993); LA. Civ.

CODE ANN. arts. 2315 & 2216). “This tort apphes in

both nondisclosure and misinformation cases.” Society,

126 F.3d at 742 (citing Nesbitt v. Dunn, 28240 (La. App.

2 Cir 4/3/96), 672 So.2d 226, 231).

“The action for neghgent misrepresentation arises cx

delicto.. and 1s subject to the one year prescriptive

period of Civil Code article 3492....” National Council on

Compensation Ins v Qwuxx Temporary Services, Inc.,

95-0725 (La App. 4Cir 11/16/95), 665 So.2d 120, 122

Qnternal citations omtted) The one year prescription

period for delictual actions commences from the date

62a

the injury or damage 1s sustained. Wimberly v Gatch,

635 So.2d 206, 211 (La. 1994) (citations omitted). This

prescription statute is stmctly construed against

prescription and in favor of the obligation sought to be

extinguished by it. Id.

The doctrine of contra non valentem is an exception to

the prescription rules, and it suspends prescription

when the case satisfies one of four scenarios 1 ) where

there was some ijegal cause which prevented the courts

or their officers from taking cognizance of or acting on

the plaintiffs action, 2.) where there was some condition

coupled with a contract or connected with the

proceedings which prevented the creditor from suing or

acting; 3.) where the debtor himself has done some act

effectually to prevent the creditor from availing himself

of his cause of action, and, 4.) where some cause of

action 1s not known or reasonably knowable by the

plaintiff, even though his 1gnorance 1s not induced by

the defendant. Id. The plaintiff bears the burden of

showing why the claim has not prescribed. Id. BPSB

has not demonstrated that contra non valentem applies

in its case such that the one-year period 1s suspended.

Prescription may also be suspended where the tort 1s

contmuing <A continuing tort arises when “acts or

conduct are continuous on an almost daily basis, by the

same actor, of the same nature, and the conduct

becomes tortious and actionable because of its

continuous, cumulative, synergistic nature.”

Bustamento v. Tucker, 607 So.2d 532, 542 (La. 1992). In

the case of a continuing tort, prescription does not

commence until the last act occurs or the conduct is

abated Id. As to whether a tort 1s continuous, the

Louisiana Supreme Court held.

63a

A contimuing tort 1s occasioned by [the contmual|]

unlawful acts, not the contmuation of the 1ll

effects of an onguinal, wrongful act.”

Addressing the requirement that there be

continuous conduct by the defendant, we stated

that “[t]he continuous conduct contemplated in a

continuing tort must be tortious and must be the

operating cause of the injury. .When a

defendant’s damage-causing act 1s completed, the

existence of continuing damages to a plaintiff,

even progressively worsening damages, does not

present successive causes of action accruing

because of a continuing tort

In re Moses, 788 So.2d 1173, 1183 (La. 2001) (quoting

Crump v. Sabine River Authority, 737 So.2d 720 (La.

1999) (other internal citations omitted)). Honeywell’s

alleged unlawful acts were not continuous. Rather, the

only facts that BPSB alleges are the continuation of the

ill effects of an original, wrongful act Therefore,

BPSB’s negligent misrepresentation claim is barred by

the one-year statute of hmitations

E Claim for New Trane Chillers

Honeywell argues that the court should dismiss BPSB’s

claim for new Trane chillers because BPSB knowingly

accepted McQuay chillers. BPSRB claims that its

employees and individual board members did not have

authority to receive the substituted McQuay chillers.

BPSB also clams that Honeywell knew that school

employees or individual board members lacked the

authority to modify public contracts.

64a

Professor Litvinoff, in his Obhgations treatise, writes.

|W |hen the obligor 1s bound to deliver a specified

and individualized thing, his performance will not

extinguish the obligation unless he delivers that

thing....Nevertheless, the obligor may give a

different thing if the obligee consents to receive

it in performance of the: obligation. This 1s the

case of a the giving in payment, which 1s actually

an agreement between obhgor and obligee to

extinguish the obhgation through the rendering

of a performance different from that originally

contemplated.

5 LA. Civ. L. TREATISE § 13.12 (2006-07) (citing LA.

Civ. CODE ANN. arts 2655 & 2659) »

BPSB does not present evidence that its employee or

board member protested the installation, or that BPSB

itself protested the installation of the substitute

McQuay chillers. Thus, because BPSB_ know ely

accepted the McQuay chillers, BPSB’s claim for new

Trane chillers 1s dismissed

F’. Enforcement of Waiver of Consequential Damages

Honeywell asks the court to uphold the contract’s

consequential damage!” waiver clause. This clause

excludes “incidental, special, consequential, or indirect”

damages. Honeywell asserts that its sole lability for a

failure of energy or operational savings is limited to the

contractual guarantee of $107,532,00.""" Therefore,

Honeywell suggests that it was "bound to pay BPSB

the difference between the annual amount guaranteed

and the actual savings achieved," BPSB argues that

65a

Honeywell was in bad faith and the court should not

enforce a hmuitation of lability clause where the

breaching party 1s 1n bad fatth.

A party may hmit the amount of damages, but the

waiver must be: "1) written in clear and unambiguous

terms; 2) contained in the contract, 3) brought to the

attention of the parties against whom it 1s to be

enforced." Gulf Am. Indus. v. Airco Indus. Gases, 573

So 2d 481, 489 (La. App. 5 Cir 1990). First, the waiver in

this case 1s clear and unambiguous. The waiver states

THIS GUARANTEE IS HONEYWELL'S

SOLE LIABILITY WITH RESPECT TO ANY

CLAIM FOR ENERGY AND OPERATIONAL

SAVINGS. IN NO EVENT SHALL

HONEYWELL BE LIABLE FOR

INCIDENTAL, SPECIAL,

CONSEQUENTIAL, OR INDIRECT

DAMAGES ARISING FROM OR RELATING

TO PERFORMANCE DELIVERY OF ANY

PRODUCT OR SERVICE PURSUANT TO

THIS AGREEMENT, ANY RELATED

SERVICE AGREEMENT, OR THIS

GUARANTEE

The contract clearly limits BPSB's damages to the

difference between annual projected energy savings

and operational savings amount, and the waver

reiterates that the energy savings’ constitute

Honeywell's sale hability to BPSB Second, the waiver

iS contained in the contract; Third, BPSB does not

argue that Honeywell failed to bring the waiver to its

attention, and Honeywell demonstrates through an

affidavit of a board member that the Board was aware

66a

ofthe waiver "

Waivers of damages caused by bad faith or intentional

conduct are void, Article 2004 of the Louisiana Civil

Code provides, in pertinent part, "Any clause 1s null

that, m advance, excludes or Louisiana Civil Code

provides, in pertinent part, “Any clause 1s null that, in

advance, excludes or limits the hability of one party for

intentional or gross fault that causes damage to the

other party.” LA. Civ. CODE ANN. art 2004. The

comment to article 2004 notes that “such clauses are

against public policy because the overriding principle of

good faith would be destroyed if it were possible to

contract away liability for fraud.” Id. at emt. (a). Thus,

to the extent that the contractual waiver of

consequential damages excludes damages arising out of

bad faith or intentional misconduct, the waiver must be

void The waiver 1s, however, otherwise enforceable

because it 1s clear and unambiguous, contained in the

contract, and was brought to the attention of BPSB.

For the reasons stated in this Memorandum Ruling,

IT IS ORDERED that the Defendant’s Motion for

Partial Summary Judgment filed on behalf of

Honeywell Corporation is hereby GRANTED;

IT IS ORDERED that Plaintiffs LUTPA claim is

DISMISSED;

Ii’ IS ORDERED that Plaintiffs detrimental rehance

claim is DISMISSED;

IT IS ORDERED that Plaintiff's unjust enrichment

clam is DISMISSED,

67a

IT IS ORDERED that Plaintiff's claim that it be

awarded new Trane chillers is DISMISSED,

IT IS FURTHER ORDERED that the contract’s

waiver of incidental, special, consequential, or indirect

damages is enforceable insofar as it does not limit

damages arising out of Honeywell’s bad faith.

Footnotes

1Pet. J 5; Def.’s Ex. 6 (BPSB-Honeywell Contract).

2Pet 96; Def’s Ex. 6, at 18

3Pet 4 10; Def’s Ex. 6, at 3-4.

4Def’s Ex 6, at 18

5Def.’s Statement of Undisputed Facts 7 16.

6Id

71d. 418.

Sid.

SID

10Id. ¥ 19; Pet. ¥ 11.

11Def's Statement of Undisputed Facts ¥ 20

121d. J 20.

13The issue of whether the plaintiff states a claim

under LUTPA 1s raised here sua sponte

14“A person commits the tort of negligent

misrepresentation when (I) he has a legal duty to

supply correct information; (2) he breaches that duty,

and (3) his breach causes damages to the plaintiff

Society of Roman Cathohe Church of Diocese of

Lafayette, Inc v. Interstate Fire & Cas. Co., 126 F 3d

727, 742 (5th Cir. 1997) (ating Barme v. VP.

Exterminators, Inc , 625 So.2d 1007 (La 1993). “This

tort applies in both nondisclosure and misinformation

cases.” Society, 126 F.3d at 742 (citing Nesbitt v Dunn,

28240 (La App 2d Cir 4/3/96), 672 So.2d 226, 231).

68a

l5Article 2655 states, “Giving in payment 1s a contract

whereby an obligor gives a thing to the obligee, who

accepts it in payment of a debt” Article 2659 explains,

“The giving in payment 1s governed by the rules of the

contract of sale, with the differences provided for 1n this

Chapter.”

16Consequential damages are “Losses that do not flow

directly and immediately from an injurious act but that

result indirectly from the act” BLACK’S LAW

DICTIONARY (8th ed. 2004).

17Supp. Mem. 14.

18 In fact, Board member Steve Lacy himself reviewed

and marked up the drafts of the contract that contained

the waiver provision, Def's Mot. for Partial Summary

Judgment 15.

69a

Filed 7/20/2009

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No, 08-3064 1

SCHOOL BOARD OF BEAUREGARD PARISH,

Plaintiff-Appellant,

versus

HONEYWELL INTERNATIONAL, INC.,

Defendant-Appellee.

No. 08-31004

SCHOOL BOARD OF BEAUREGARD PARISH,

Plaintiff-Appellant,

versus

HONEYWELL, INC,

Defendant-Appellee.

Appeals from the Umted States District Court for the

Western District of Louisiana No 2.05-CV-1388.

Before HIGGINBOTHAM, SMITH, and

SOUTHWICK, Cireuit Judges

PER CURIAM:*

Treating the Petition for Reheamng En Bane as a

Petition for Panel Rehearing, the Petition for Panel

Rehearing 1s DENIED. No member of the panel nor

judge in regular active service of the court having

requested that the court be polled on Rehearing En

Banc (Fed. R. App P and 5" Cir. R. 35), the Petition

for Rehearing En Bancis DENIED.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.