Cypress/Spanish Fort I, L.P. v. Professional Service Industries, Inc.

814 F. Supp. 2d 698, 2011 U.S. Dist. LEXIS 97343, 2011 WL 3844098
CourtDistrict Court, N.D. Texas
DecidedAugust 29, 2011
DocketCivil Action No. 3:10-CV-1507-B
StatusPublished
Cited by12 cases

This text of 814 F. Supp. 2d 698 (Cypress/Spanish Fort I, L.P. v. Professional Service Industries, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cypress/Spanish Fort I, L.P. v. Professional Service Industries, Inc., 814 F. Supp. 2d 698, 2011 U.S. Dist. LEXIS 97343, 2011 WL 3844098 (N.D. Tex. 2011).

Opinion

MEMORANDUM OPINION AND ORDER

JANE J. BOYLE, District Judge.

Before the Court are Defendant Professional Service Industries, Inc.’s Motion to Dismiss (doc. 39), filed March 20, 2011, and Plaintiff Spanish/Cypress Fort I, L.P.’s Motion to Partially Strike Defendant’s Motion to Dismiss (doc. 42), filed March 25, 2011. Having considered the Motions, the Court hereby DENIES both Defendant’s Motion to Dismiss and Plaintiffs Motion to Strike.

I.

BACKGROUND

This is a construction dispute concerning geotechnical design and testing work performed by Defendant Professional Service Industries, Inc. (“PSI”) at a 268-acre mixed-used development project (the “Project”) owned and developed by Plaintiff Cypress/Spanish Fort I, L.P. (“Plaintiff’). This development, known as the Spanish Fort Town Center, is located in Spanish Fort, Alabama. (PL’s 1st Am. Compl. ¶ 1).

The relevant facts in this case begin in June 2005, when Plaintiff hired Hoar Construction to serve as its general contractor on the Project. (Id. ¶ 18). Hoar, in turn, subcontracted with Newell & Sons, Inc. (“Newell”) to perform the Project’s earthwork. (Id.). This earthwork chiefly consisted of the erection of large slopes around the perimeter of the Project by bringing in fill and then compacting the fill material, so as to raise the height of the surface upon which the Project would be built. (Id. ¶¶ 17-18). Newell’s earthwork also consisted of roadway excavations, embankments, foundations, drainage, soil stabilization, and soil reinforcement. (Id. ¶ 18).

In July 2005, Plaintiff hired PSI to serve as its geotechnical engineer (“geotech”) on the Project. (Id. ¶ 21). As the project geotech, PSI was tasked with monitoring the progress of the Project’s earthwork by conducting regular soil compaction tests at specified intervals. (Id. ¶¶ 21-22). PSI would thus ensure that Hoar and Newell were properly complying with the terms of Hoar’s agreement with Plaintiff, which included detailed specifications concerning the earthwork, particularly the type of fill and level of compaction. (Id. ¶ 19, 21). PSI also agreed to indemnify Plaintiff for any losses suffered because of PSI’s failure to perform its obligations under the agreement. (Id. ¶ 26).

Construction on the Project began in 2005. (Id. ¶ 28). Plaintiff alleges that from the start, Newell’s earthwork fell “far below the standards required by the Project’s specifications.” (Id.). More specifically, Plaintiff alleges that Newell regularly used sub-standard fill materials and improperly dumped too much fill between [705]*705compactions. (Id. ¶ 29).1 With respect to PSI, Plaintiff alleges that the geotech was an “active participant” in Newell’s misconduct — concealing failing test results from Plaintiff, falsifying positive tests for locations that were never tested, failing to test large portions of the project altogether, allowing Newell to do soil compaction outside of PSI’s presence, instructing PSI employees not to report Newell’s misconduct to Plaintiff, and allowing subsequent layers of fill to be placed on top of prior layers known by PSI to be failing. (Id. ¶ 31). Plaintiff additionally alleges that PSI failed to properly staff the Project in accordance with the terms of its agreement with Plaintiff, and that PSI and its representatives in fact conspired with Newell and its representatives to defraud Plaintiff through the above described conduct. (Id. ¶¶ 33, 40-42).

On November 5, 2007, Plaintiff discovered a slope failure at one part of the Project. (Id. ¶ 46). Plaintiff alleges that this failure is the result of Newell and PSI’s misconduct. (Id.). Plaintiff, Hoar, New-ell, and PSI settled all disputes concerning that failure in June 2008. (Id. ¶ 53). After discovering the first slope failure, however, Plaintiff discovered a number of other slope failures on the project. (Id. ¶ 57). These failures are the subject of the instant lawsuit.

Plaintiff instituted the instant action against PSI in state court on June 30, 2010. PSI removed the case to this Court on August 2, 2010 (doc. 1), and then sought a transfer of the case to the Southern District of Alabama (doc. 3). The Court denied this request (doc. 16). In early February 2011, Plaintiff sought (doc. 30) and received (doc. 32) permission to file its First Amended Complaint (doc. 33). In its Amended Complaint, Plaintiff asserts causes of action for RICO violations, RICO conspiracy, fraud, fraudulent suppression, breach of contract, breach of breach of express warranty, breach of implied warranty, negligence, negligent hiring and retention, negligent training, negligent supervision, negligent misrepresentation, and tortious interference with contract, and also requests a declaration as to indemnity. (Pl.’s Am. Compl. ¶¶ 98-134).

On March 10, 2011, Defendant filed a Motion to Dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure (doc. 39). Defendant contends that (1) Plaintiffs common law claims are barred due to the running of the applicable statutes of limitations, (2) Plaintiffs indemnity claim is redundant of its breach of contract claim, and (3) Plaintiffs RICO claims were improperly plead. Plaintiff responded (doc. 47) on March 31, 2011, and PSI replied (doc. 54) on April 14, 2011.2

On May 27, 2011, after the parties’ briefing had been ripe for more than a month, Plaintiff filed a Supplement (doc. 58) to its Response opposing dismissal, contending [706]*706that the Texas statutes of limitations should apply in the instant case, not the Alabama statutes briefed by the parties. Defendant objected that this filing was untimely (doc. 62). While the Court agreed that the Supplement was untimely, the Court found in the interests of judicial economy that the issue should be fully briefed (doc. 65). PSI filed its Response (doc. 69) on July 1.

Within two weeks of the completion of the briefing on the Motion to Dismiss, both parties submitted Motions for Summary Judgment (doc. 73, 81). In its Motion for Summary Judgment, PSI reasserts its statute of limitations arguments, and also raises certain arguments concerning the June 19, 2008 settlement agreement between Plaintiff and PSI and the issue of stigma damages. (See generally Def.’s Br. in Supp. of Mot. Summ. J.) The parties’ Motions for Summary Judgment will be addressed in a separate Order once the briefing on Plaintiffs Motion is completed.

The briefing on PSI’s Motion to Dismiss thus being ripe, the Court now turns to the merits of its decision.

II.

LEGAL STANDARDS

A. Rule 12(b)(6) Standard

Under the Federal Rules of Civil Procedure, a complaint must contain “a short, plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). A plaintiff may support her claim for relief with any set of facts consistent with the allegations in the complaint. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 563, 127 S.Ct.

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Bluebook (online)
814 F. Supp. 2d 698, 2011 U.S. Dist. LEXIS 97343, 2011 WL 3844098, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cypressspanish-fort-i-lp-v-professional-service-industries-inc-txnd-2011.