Free Motion for Leave - District Court of Colorado - Colorado

Case 1:03-cv-02461-MSK-MEH

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Civil Action No. 03-cv-2461-MSK-OES LEPRINO FOODS COMPANY, Plaintiff, v. FELDMEIER EQUIPMENT, INC., Defendant.

SURREPLY OF PLAINTIFF TO DEFENDANT FELDMEIER EQUIPMENT, INC.'S REPLY IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATION (DOCUMENT 78)

Plaintiff Leprino Foods Company ("Leprino" or "Plaintiff"), through its counsel, respectfully submits the following as its surreply to "Defendant Feldmeier Equipment, Inc.'s Reply in Support of Motion for Summary Adjudication" ("Reply Brief") based on, among other things, the new evidence and new arguments presented for the first time by Feldmeier in its Reply Brief.

I. FELDMEIER ASSERTED NEW EVIDENCE AND NEW ARGUMENTS FOR THE FIRST TIME IN ITS REPLY BRIEF Feldmeier's Motion for Summary Adjudication ("Summary Judgment Motion") only focused on the delivery dates of the subject Feldmeier silo. (See, Summary

Judgment Motion at pp. 1, 3). The Summary Judgment Motion never addressed when Leprino discovered or should have discovered Feldmeier's refusal or inability to

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maintain the subject silo as warranted in the contract, and it never addressed when Leprino become aware of, or should have become aware of, the defects in the subject Feldmeier silo. Feldmeier knew from the pleadings and discovery in this case that the delivery dates of the subject silo are not the issue. Yet, Feldmeier never raised the issue of when Leprino discovered the defect in the subject silo, forcing Leprino to raise and discuss the issue in its Response Brief. Feldmeier apparently proceeded in that fashion so that it could assert new evidence and new arguments (i.e., evidence and arguments not included in its Summary Judgment Motion) in its Reply Brief and, at the same time, attempt to deprive Leprino of the opportunity to respond to those new materials. Since Feldmeier advanced, in its Reply Brief, new evidence and new legal arguments in support of its Summary Judgment Motion, Leprino should be given an opportunity to respond to that new evidence and those new legal arguments. Green v. New Mexico, 420 F.3d 1189, 1196 (10th Cir. 2005); Doebele v. Sprint/United Management Co., 342 F.3d 1117, 1139 Fn. 13 (10th Cir. 2003). A. Feldmeier's Reply Brief Misconstrues The Basis Of Leprino's Claims And, Thus, Argues Incorrect Events For The Accrual Of Those Claims. For the first time, in its Reply Brief, Feldmeier asserts new arguments and new evidence about when Leprino discovered or should have discovered Feldmeier's breaches and the design defects in Feldmeier's silo. Feldmeier's Summary Judgment Motion did not even raise any argument or other evidence on either of those subjects. It is abundantly clear from its Reply Brief that Feldmeier fails to understand the true nature of the breaches and defects that underlie Leprino's claims in this lawsuit. Feldmeier's Reply Brief argues that the defects in the venting and overflow system are limited to a 2

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four-inch overflow pipe, which it essentially contends should have been replaced with a six-inch pipe. (See, Reply Brief at pp. 2, 3, 4). However, the breaches and defects discovered by Leprino's expert, Larry Mott, and which were contained in his October 15, 2003 report, go far beyond just an analysis of the size of the overflow pipe. (See, October 15, 2003 report of L.J. Mott attached hereto as Exhibit 5; November 29, 2003 report of L.J. Mott attached hereto as Exhibit 6; Affidavit of L.J. Mott attached hereto as Exhibit 7 attesting to the authenticity of Exhibits 5 and 6). An examination of Mr. Motts' October 15, 2003 report reveals the following: Mr. Mott opined that the "solution implemented at the Lemoore facility involving the installation of 6" overflow lines in place of the original Feldmeier 4" lines is not expected to be an effective design change." (See, Exhibit 5 at p. 5). Mr. Mott's extensive

analysis of fluid dynamics resulted in his conclusion that, "[w]eir flow regimes and vortex inhibited entrance conditions will affect the 6" line in the same manner as the 4" line." (See, Exhibit 5 at p. 5). In other words, Mr. Mott opined that the fluid in the silo would not just flow over the edge of the overflow pipe, but that it would swirl around as it entered the overflow pipe causing a vortex, which drastically decreases the volume of liquid that can be removed from the silo, regardless of whether a six-inch or four-inch pipe is used. (See, Exhibit 5 at pp. 4, 5). Mr. Mott recommended against replacing the four-inch pipes with six-inch pipes on Leprino's other Feldmeier silos because that would not remedy the design defects. (See, Exhibit 5 at p. 5). Mr. Mott concluded that even utilizing a six-inch overflow pipe in conjunction with Feldmeier's internal piping/venting and overflow system would not permit a flow rate of 365 gallons per

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minute, let alone the 800 gallons per minute represented by Feldmeier and which Feldmeier contracted to provide to Leprino. (See, Exhibit 5 at p. 5). The design

defects in the Feldmeier silos go to the very essence of their internal piping/venting and overflow systems, i.e., the "Feldmeier Advantage" itself. Simply put, the "Feldmeier Advantage" does not work. Mr. Mott recommended that the only way to prevent the implosions caused by the Feldmeier advantage was to utilize an external vacuum breaker with each silo. (See, Exhibit 5 at p. 5). Clearly, Leprino did not know of the real nature of Feldmeier's breaches and the true cause of the design defects in Feldmeier's internal piping/venting and overflow system until Mr. Mott completed his testing and analysis and rendered his October 13, 2003 report. Thus, all of Leprino's claims for relief did not arise until on or about

October 15, 2003.1 B. Feldmeier's Reply Brief Incorrectly Argues That Leprino Knew Of The Defects In The Venting And Overflow Arrangement On The Subject Feldmeier Silo As Of December 14, 2000. 1. The new evidence and arguments concerning the deposition of Charles Williams does not advance Feldmeier's argument.

For the first time in its Reply Brief, Feldmeier argues that Leprino knew of the design defects in the Feldmeier silo on or before December 14, 2000, by virtue of an email sent from Eric Merritt to Charles Williams. (See, Reply Brief at pp. 1, 2).

Feldmeier is wrong. In support of that new argument, Feldmeier also asserts new
Without any support, Feldmeier's Reply Brief essentially questions the veracity of the Affidavit of Jon B. Alby, which is attached to Lerpino's Response Brief as Exhibit 3. As plainly set forth herein and contrary to Feldmeier's outrageous contentions, it was not until completion of Mr. Mott's October 13, 2003 report that Leprino knew or should have known of the existence of its claims against Feldmeier. Moreover, it is
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evidence in its Reply Brief, i.e., Exhibits A, B and C (sic) to its Reply Brief.2 Those exhibits merely set forth that Eric Merritt believed the four-inch overflow pipe was not large enough. As detailed above, that is not the basis of the breaches and design defects upon which Leprino brings its claims against Feldmeier. A closer look at the deposition testimony of Charles Williams concerning the December 14, 2000 email shows that Mr. Merritt expressed his belief about the size of the pipe without any supporting calculations or other data. (See, Reply Brief, Exhibit A (sic) at pp. 72-73, ll. 23-4). Additionally, while Mr. Williams stated that he agreed with Mr. Merritt that there was "some sort of design defect," he did so merely because "it's not normal for a tank to implode" and without any independent calculations or any investigation into whether there was a design defect. (See, Reply Brief, Exhibit C (sic) at pp. 106-107, ll. 12-1). Although Mr. Williams testified he was told about "incorrect size and vent overflows" by Eric Merritt, possibly by Stainless Fabrication, Inc. and then also by Larry Mott, Feldmeier's counsel failed to ask when Mr. Williams was told that by each of those individuals. The deficient evidentiary record advanced by Feldmeier reinforces the

existence of disputed issues of material fact that preclude the entry of summary judgment. 2. The new evidence and arguments regarding Leprino's Authorization for Expenditure does not support Feldmeier's argument.

Feldmeier also argues for the first time in its Reply Brief, that Leprino's knowledge of the design defects in the Feldmeier silo was confirmed by an
axiomatic that a judge may not evaluate the credibility of witnesses in deciding a motion for summary judgment. Seamons v. Snow, 206 F.3d 1021, 1026 (10th Cir. 2000).

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Authorization for Expenditure dated March 2002. (See, Reply Brief at p. 3). Again, Feldmeier is wrong. In support of that new argument, Feldmeier also asserts new evidence in its Reply Brief, i.e., Exhibits D, E, F and G (sic) to its Reply Brief. Those new exhibits only show that Leprino was replacing four-inch overflow pipes with six-inch pipes, while under the mistaken impression that a six-inch pipe would prevent the problems with the Feldmeier tanks. As noted in detail above and in greater detail in Leprino's Exhibits 5 and 6 attached hereto, the size of the overflow pipe is not the problem that underlies Leprino's claims in this lawsuit. Leprino finally learned of the design defect in Feldmeier's internal piping/venting and overflow system when Mr. Mott rendered his October 13, 2003 report.

II. FELDMEIER'S STATUTE OF LIMITATIONS AFFIRMATIVE DEFENSE FAILS A. Leprino's Breach Of Contract And Breach Of Warranty Claims Were Timely Filed. The warranties contained in Section 6.3 of the Equipment Purchase Agreement extend to future performance of the silo and, as such, the accrual of a claim for a breach of those warranties does not begin upon delivery. See, C.R.S. § 4-2-725(2). Thus, Leprino's First Claim for Relief of Breach of Contract and its Third Claim for Relief of Breach of Implied and Express Warranties arose when Leprino learned of Feldmeier's failure to comply with the Equipment Purchase Agreement's warranties of future performance. Smith v. Union Supply Co, 675 P.2d 333, 335 (Colo. App. 1983). Those

Defendant failed to comply with D.C.COLO.LCivR 56.1C.1. by marking its exhibits using letters, rather than marking them as A-1 through A-99.

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claims are governed by a three-year limitary period. C.R.S. §§ 4-2-725(1) and 13-80101(1)(a). So, even assuming for the sake of argument that Leprino learned of

Feldmeier's failure to comply with Section 6.3 of the Equipment Purchase Agreement on December 14, 2000, as Feldmeier contends, Leprino's Breach of Contract and Breach of Warranty Claims were still timely filed within the three-year limitary period on November 4, 2003. However, since there clearly appears to be a disputed question of fact as to when Leprino discovered or should have discovered Feldmeier's breach, summary judgment on Feldmeier's affirmative defense of expiration of the statute of limitations is precluded. See Gavend v. Malman, 946 P.2d 558, 563 (Colo. Ct. App. 1997). B. Leprino's Negligence, Product Liability And Negligent Misrepresentation Claims Were Timely Filed. As noted above, Leprino did not know of the defect in the Feldmeier silo until Mr. Mott issued his October 13, 2003 report. It was at that time that the two-year limitary period applicable to Leprino's Second Claim for Relief of Negligence, Fourth Claim for Relief of Negligent Misrepresentation, and Fifth Claim for Relief of Strict Product Liability for Misrepresentation began to accrue. C.R.S. §§ 13-80-102(1)(a) and (b), and 13-80106(1). Moreover, Leprino's Negligent Misrepresentation claim is based on, among other things, the "Feldmeier Advantage" which was touted by Feldmeier sales representatives to Leprino prior to the execution of the Equipment Purchase Agreement. (See, Exhibit 4 attached to Leprino's Response Brief at pp. 17-18, ll. 5-21). The "Feldmeier Advantage" was Feldmeier's assurance that its internal piping/venting and overflow system would 7

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act the same as, or superior to, an external vacuum breaker, thus obviating the need to purchase a separate external vacuum breaker for the silo. Id. As detailed above, it does not. By making those representations regarding the "Feldmeier Advantage" and the performance of Feldmeier's internal piping/venting and overflow system, a duty owed by Feldmeier to Leprino arose that was independent of any contractual obligations between the parties. See Town of Alma v. Azco Construction, Inc., 10 P.3d 1256, 1263 (Colo. 2000). Leprino could not have known of Feldmeier's failure to comply with its representations about the "Feldmeier Advantage" until Mr. Mott completed his analysis of the Feldmeier internal piping/venting and overflow system and issued his report. Accordingly, Leprino's Negligence, Product Liability and Negligent Misrepresentation claims were timely filed within the two-year limitary period applicable to those claims. Again, however, since there appears to be a disputed question of fact as to the accrual of those claims, summary judgment on Feldmeier's affirmative defense of expiration of the statute of limitations is precluded. See Gavend v. Malman, 946 P.2d 558, 563 (Colo. Ct. App. 1997).

III. CONCLUSION For all of the foregoing reasons, Leprino requests that this Court deny Feldmeier's Summary Judgment Motion in its entirety.

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Respectfully submitted this 17th day of November, 2005. CAMPBELL BOHN KILLIN BRITTAN & RAY, LLC

By:

s/ Bret M. Heidemann Michael G. Bohn Bret M. Heidemann 270 St. Paul Street, Suite 200 Denver, Colorado 80206 Telephone: (303) 322-3400 Facsimile: (303) 322-5800 [email protected] [email protected] ATTORNEYS FOR PLAINTIFF LEPRINO FOODS COMPANY

CERTIFICATE OF SERVICE I hereby certify that on the 17th day of November, 2005, I electronically filed the foregoing SURREPLY OF PLAINTIFF TO DEFENDANT FELDMEIER EQUIPMENT, INC.'S REPLY IN SUPPORT OF MOTION FOR SUMMARY ADJUDICATION (DOCUMENT 78) with the Clerk of Court using the CM/ECF system which will send notification of such filing to the following email addresses: Catherine A. Tallerico, Esq. at [email protected]

s/ Cori Atteberry Cori Atteberry, Legal Assistant

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