Opinion
Civil Action No. 00-307.
February 2, 2001
MINUTE ENTRY
Before the Court are three motions:
1) A Motion for Separate Trial filed by Cudzik Associates, L.L.C. (Doc. 35);
2) A Motion for Review of Magistrate Judge's Order Dated December 11, 2000 filed by Cudzik Associates, L.L.C. (Doc.46); and
3) A Motion for Summary Judgment filed by Walter J. Cudzik (Doc. 48)
Melanie Flannigan has brought suit against Walter Cudzik, individually and d/b/a Walter Cudzik and Associates Attorneys at Law, Cudzik and Associates, Inc., an inactive Louisiana corporation, and Cudzik and Associates, L.L.C. She alleges, inter alia, breach of contract, breach of covenant of good faith and fair dealing, quasi-contract, unjust enrichment, misrepresentation, civil conspiracy and equitable accounting and trust. The Court first will address the Motion for Summary Judgment.
Motion for Summary Judgment
Walter Cudzik has moved the Court to enter judgment dismissing plaintiffs claims against him personally. The thrust of defendant's motion is that the plaintiff dealt with a professional corporation and/or an L.L.C. as evidenced by the contract between the plaintiff and Cudzik and Associates and other exhibits. Defendant cites both Louisiana and Nevada law for the proposition that in order for an officer or shareholder to be personally liable for debts incurred by the corporation, the plaintiff must allege and prove fraud, malfeasance, or illegality. Deroche v. Pl Const. Materials, Inc., 554 So.2d 717 (La.App. 5th Cir. 1989); Trident Const. Corp. v. West Elec., Inc., 776 P.2d 1239, 1242 (Nev. 1989).
Plaintiff contends that the defendant Cudzik has failed and refused to participate in discovery and alleges that he is in violation of three orders of the magistrate judge which are the subject of a pending order for sanctions. Thus, plaintiff contends that a motion for summary judgment is premature until full discovery is had from Cudzik. Plaintiff claims among other things, that in order to induce plaintiff to provide services, Cudzik or his agents intentionally made misrepresentations to the plaintiff which were false when made. (Complaint ¶ 51-55). Plaintiff further alleges that Cudzik engaged in fraud, malice and ill-will. (Complaint ¶¶ 57).
Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The party moving for summary judgment bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material-fact." Stults v. Conoco, 76 F.3d 651, 656, (5th Cir. 1996), (citing Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 912-13 (5th Cir. 1992) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. The nonmoving party must come forward with "specific facts showing that there is a genuine issue for trial." Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 588 (1986) (emphasis supplied); Tubacex, Inc. v. M/V Risan, 45 F.3d 951, 954 (5th Cir. 1995).
Thus, where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no "genuine issue for trial." Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 588 (1986). Finally, the court notes that the substantive law determines materiality of facts and only "facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The court now turns to the merits of the arguments with these standards in mind.
At best, this motion is premature as the plaintiff is entitled to full discovery from Cudzik to determine if he made any assurances that he would be personally bound by the contract as it is signed by him not as "Cudzik and Associates, Inc." the actual name of the corporation but as "Cudzik and Associates." Moreover, the plaintiff is entitled to full discovery as to the allegations of fraud and misrepresentation as contemplated by Fed.R.Civ.P. 56(f).
As stated in Greenhill Petroleum Corp. v. Mike Hicks Tools Service, Inc., 1994 WL 495797 (E.D.La. Sept. 6, 1994):
In Louisiana, where there is a breach of a personal duty by a corporate officer to a third party, liability may attach. Willis v. Stauffer Chemical Co., 348 So.2d 158, 161-62 (La.App. 3d Cir. 1977). Moreover, in instances where a corporate officer is personally involved in the commission of a tort, irrespective of the corporation's liability, the officer may be liable for damages to third persons. Adams v. Fidelity Casualty Co. of New York, 107 So.2d 496, 501-02 (507 (La.App. 1st Cir. 1958); see also Lemmons v. Zurich Insurance Co., 403 F.2d 512, 515 (5th Cir. 1968) (A cause of action exists against a corporate officer upon a showing that the officer knew or had opportunity to know of a dangerous condition, had authority to correct such a condition, and failed to do so.)Greenhill at *3 For the foregoing reasons, there are genuine issues of material fact and the defendant is not entitled to summary judgment. Accordingly,
IT IS ORDERED that the Motion for Summary Judgment is DENIED.
A Motion for Review of Magistrate Judge's Order Dated December 11, 2000 flied by Cudzik Associates, L.L.C. (Doc.46)
Under Fed.R.Civ.P. 72(a), a magistrate judge's decision on a non-dispositive order shall only be set aside if the district court finds that it is "clearly erroneous or contrary to law." Defendant has filed the instant Motion for Review of the Magistrate's Order Dated December 11, 2000 as it pertains to granting plaintiffs motion to compel and deeming all objections to plaintiff's interrogatories and request for documents waived.
Defendant contends that the attorney-client privilege and the work product doctrine were not waived. Plaintiff argues that the December 11th order only addressed plaintiffs motion to compel and motion to quash and that the motion for protective order was denied by the magistrate judge on January 3, 2001. Moreover plaintiff points out that the magistrate judge ruled in her order of December 18, 2000 that inquiries sought by plaintiff did not seek privileged information. In the order of January 3rd the magistrate judge ruled that the defendant had waived its privilege objections and denied the motion for protective order as moot.
Apparently, the magistrate found the waiver as the result of defendant's failure to follow the Federal Rules pertaining to discovery on multiple occasions. Additionally, based on the magistrate judge's order of December 18, 2000, the magistrate judge did not find similar discovery requests to be protected by the attorney-client privilege or work product doctrine. The Court has reviewed the discovery history in this proceeding as well as the specific requests sought by the plaintiffs as well as defendant's request for a protective order and finds no clear error on the part of the magistrate judge. Accordingly,
IT IS ORDERED Motion for Review of Magistrate Judge's Order Dated December 11, 2000, is DENIED.
A Motion for Separate Trial filed by Cudzik Associates, L.L.C. (Doc. 35)
Finally, the Court will address the Cudzik Associates, L.L.C.'s Motion for Separate Trial. The Court has reviewed the record of this matter as well as the memoranda filed by the parties and finds no merit in this motion as it will not promote judicial economy and such an action could cause undue prejudice to plaintiff. Separation of issues is not the usual course that is followed and only should be done when the issue to be tried is so distinct and separable from the others that a trial of it alone may be had without injustice. Castano v. American Tobacco Co., 84 F.3d 734 750 (5th Cir. 1996). This matter is not of that ilk. Accordingly,
IT IS ORDERED that the Motion for Separate Trial filed by Cudzik Associates, L.L.C. (Doc. 35) is DENIED.