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Frontier Contracting Inc. v. Allen Engineering Contractor, Inc.

United States District Court, E.D. California

September 25, 2014

FRONTIER CONTRACTING INC.; UNITED STATES GOVERNMENT[1], Plaintiffs,
v.
ALLEN ENGINEERING CONTRACTOR, INC.; SAFECO INSURANCE COMPANY OF AMERICA; LIBERTY MUTUAL INSURANCE, and DOES 1-50, Defendants. ALLEN ENGINEERING CONTRACTOR, INC.; Counter-Claimant,
v.
FRONTIER CONTRACTING, INC., Counter-Defendants.

ORDER DENYING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT (DOC. 89)

GARY S. AUSTIN, Magistrate Judge.

I. Introduction

Pending before the Court is Defendants, Safeco Insurance Company of America, and Liberty Mutual Insurance Company's (collectively "Defendants") Motion for Summary Judgment. (Doc.89). Plaintiff, Frontier Inc. ("Frontier"), filed an opposition (Doc. 94 and 95) and the Defendants filed a Reply (Doc. 96 and 97). The Court took this matter under submission pursuant to Local Rule 230(g). Upon a review of the pleadings, Defendants' Motion for Summary Judgment is DENIED.

II. Plaintiff's Complaint

Plaintiff's complaint alleges that on or about February 3, 2010, Frontier and Allen Engineering Contractor, Inc. ("Allen") entered into a teaming agreement to complete two U.S. Federal Highway projects in Sequoia and Kings Canyon National Parks. Plaintiff contends that Allen was the prime contractor, and that Frontier was a first-tier subcontractor. The two projects involved completing improvements to: (1) the General's Highway, a $14 million project (contract #DTFH68-10-C-00015), and (2) the Kings River Bridge, a $6 million project (contract # #DTFH68-10-C-00033). Under the terms of the teaming agreement, Allen was to provide the administrative duties, while the Frontier was to perform the physical construction. At Allen's request, Defendants Safeco and Liberty Mutual furnished the required performance/payment bonds under the Miller act. 40 U.S.C. ยง 3131(b).

Frontier alleges that during the course of the projects, disputes arose beginning in September 2010, between the parties resulting in only partial payments being made by Allen to Frontier. By January 2011, Allen stopped making payments on the General's Highway project altogether, and only made nominal payments on the King's River Bridge project. Frontier contends that efforts to receive payments were unsuccessful.

Beginning March 2011, Plaintiff alleges that following Allen's refusal to pay all monies due, Allen utilized Frontier's personnel to train Allen's workers on how to perform the construction duties that Frontier had been performing. On June 30, 2011, after Allen's employees were trained by Frontier, Allen sent Frontier a stop notice advising Frontier workers not to return to the job site. By August 2011, Allen allegedly owed Frontier $2, 641, 947.75.

Based on the above, Frontier filed its Complaint on September 20, 2011 (Doc. 2), a First Amended Complaint on October 6, 2011 (Doc. 9), and a Second Amended Complaint ("SAC") against all Defendants on November 18, 2011. (Doc. 16). The SAC alleges causes of action for violations of the Miller Action, Quantum Meruit, and Fraud. Plaintiff seeks $2, 641, 947.75 in general damages; $2, 000, 000.00 in punitive damages; pre and post-judgment interest at the rate of 10%; attorney's fees and costs; as well as any other just relief.

On March 5, 2012, Allen filed a Counterclaim against Frontier alleging Breach of Contract, Reasonable Value of the Contracts, and Negligence. (Doc. 34). Defendants seek compensatory, consequential and special damages in the amount of $1, 800, 000.00 for breach of the first contract; $4, 190, 910.39 for breach of the second contract; reasonable value of services rendered on both contracts; attorney's fees; costs and other just relief.

III. Defendant's Motion for Summary Judgement

In the Motion for Summary Judgment, Defendants contend that Frontier was not a subcontractor. Instead, the teaming agreement alleged in the SAC created a joint venture between the parties. Defendants argue that the existence of the joint venture is fatal to Frontier's case because a subcontractor relationship is required to state a claim under the Miller Act. In opposition, Plaintiff argues that the teaming agreement, which was never signed by Allen, contemplated Frontier as a first-tier subcontractor for both projects. In support of its position, Frontier contends that there is conflicting evidence including deposition testimony from each of the presidents of the corporations on this issue, as well as other documents indicating a subcontractor relationship existed thereby creating a genuine dispute as to material facts. As such, Defendants' Motion for Summary Judgment should be denied.

IV. Summary Judgment Standard

Any party may move for summary judgment, and the Court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a) (quotation marks omitted); Washington Mut. Inc. v. U.S., 636 F.3d 1207, 1216 (9th Cir. 2011). Each party's position, whether it be that a fact is disputed or undisputed, must be supported by (1) citing to particular parts of materials in the record, including but not limited to depositions, documents, declarations, or discovery; or (2) showing that the materials cited do not establish the presence or absence of a genuine dispute or that the opposing party cannot produce admissible evidence to support the fact. Fed.R.Civ.P. 56(c)(1) (quotation marks omitted). The Court may consider other materials in the record not cited to by the parties, although it is not required to do so. Fed.R.Civ.P. 56(c)(3); Carmen v. San Francisco Unified Sch. Dist., 237 F.3d 1026, 1031 (9th Cir. 2001); accord Simmons v. Navajo Cnty., Ariz., 609 F.3d 1011, 1017 (9th Cir. 2010).

Defendants do not bear the burden of proof at trial and in moving for summary judgment, they need only prove an absence of evidence to support Plaintiff's case. In re Oracle Corp. Sec. Litig., 627 F.3d 376, 387 (9th Cir. 2010) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548 (1986)). If Defendants meet their initial burden, the burden then shifts to Plaintiff "to designate specific facts demonstrating the existence of genuine issues for trial." In re Oracle Corp., 627 F.3d at 387 (citing Celotex Corp., 477 U.S. at 323). This requires Plaintiff to "show more than the mere existence of a scintilla of evidence." Id. (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505 (1986)). In judging the evidence at the summary judgment stage, the Court may not make credibility determinations or weigh conflicting evidence, Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007) (quotation marks and citation omitted), and it must draw all inferences in the light most favorable to the nonmoving ...


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