W. Environmental Corp. of Ohio v. Hardy Diagnostics

2024 Ohio 3051, 251 N.E.3d 221
CourtOhio Court of Appeals
DecidedAugust 12, 2024
DocketCA2023-12-109
StatusPublished
Cited by3 cases

This text of 2024 Ohio 3051 (W. Environmental Corp. of Ohio v. Hardy Diagnostics) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
W. Environmental Corp. of Ohio v. Hardy Diagnostics, 2024 Ohio 3051, 251 N.E.3d 221 (Ohio Ct. App. 2024).

Opinion

[Cite as W. Environmental Corp. of Ohio v. Hardy Diagnostics, 2024-Ohio-3051.]

IN THE COURT OF APPEALS

TWELFTH APPELLATE DISTRICT OF OHIO

WARREN COUNTY

WESTERN ENVIRONMENTAL : CORPORATION OF OHIO, : CASE NO. CA2023-12-109 Appellee and Cross-Appellant, : OPINION 8/12/2024 - vs - :

: HARDY DIAGNOSTICS, et al., : Appellant and Cross-Appellee.

CIVIL APPEAL FROM WARREN COUNTY COURT OF COMMON PLEAS Case No. 21 CV 94033

Millikin & Fitton Law Firm, and Steven A. Tooman Thomas A. Dierling, for appellee and cross-appellant.

Bruns, Connell, Vollmar & Armstrong, LLC, and Thomas B. Bruns and Lucinda C. Shirooni, for appellee and cross-appellant.

The Behal Law Group LLC, and Jack D'Aurora, for appellant and cross-appellee.

S. POWELL, P.J.

{¶ 1} Appellant/cross-appellee, Hardy Diagnostics ("Hardy"), appeals the

decision of the Warren County Court of Common Pleas denying it summary judgment for

breach of contract against appellee/cross-appellant, Western Environmental Corporation Warren CA2023-12-109

of Ohio ("WEC"), opting to instead grant summary judgment to WEC for breach of contract

against Hardy. WEC also cross appeals the trial court's decision granting summary

judgment to Hardy on its spoliation of evidence claim. For the reasons outlined below,

we affirm the trial court's decision granting summary judgment to WEC for breach of

contract against Hardy, the denial of summary judgment to Hardy on its breach of contract

claim against WEC, and dismiss as moot WEC's cross-appeal from the trial court's

decision granting summary judgment on its spoliation of evidence claim to Hardy.

The Parties

{¶ 2} Prior to the company being sold in 2022, WEC was a designer and builder

of environmental clean areas ("ECA"), or cleanrooms, with its principal place of business

located in Franklin, Warren County, Ohio. A cleanroom is a type of controlled

environment that requires stringent control of contamination of air, and surfaces, to levels

appropriate for accomplishing certain contamination-sensitive activities. Cleanrooms are

designed as ISO 1 through 9. The "ISO" abbreviation refers to the International

Organization for Standardization 14644-1, a document that sets forth the maximum

particulate count for certification of various types of cleanrooms. There is no dispute that

ISO standards do not set forth a required minimum number of air changes per hour

("ACH") for cleanrooms that manufacture microbiology products.

{¶ 3} Hardy manufactures various culture media used for microbiological testing

in clinical, research, food, and pharmaceutical laboratories. Hardy is incorporated in

Wyoming and licensed to do business in Ohio. Prior to WEC and Hardy entering into the

contract at issue in this case, Hardy was operating two cleanrooms as part of its business

operations: one in Santa Maria, California and the other in Springboro, Warren County,

Ohio. There is no dispute that, in 2017, WEC certified the cleanroom that Hardy was

-2- Warren CA2023-12-109

operating in Springboro as meeting the applicable ISO 7 standards. 1 This cleanroom is

known as ECA 1. There is also no dispute that, in 2019, WEC certified the cleanroom

that Hardy was operating in Santa Maria as ISO 7 compliant. Therefore, given their prior

business dealings, it is undisputed that WEC was familiar with Hardy's operating needs,

just as Hardy was familiar with WEC's work when certifying ISO 7 compliant cleanrooms,

prior to their entering into the contract at issue in this case.

Facts and Procedural History

{¶ 4} The facts in this case are generally not in dispute. On May 16, 2019, WEC

submitted a proposal to Hardy to provide a complete turnkey installation of a new ISO 7

cleanroom within Hardy's manufacturing facility located in Springboro for a total cost of

$643,998.00. This cleanroom was to be known as ECA 2. Hardy accepted WEC's

proposal and thereafter issued a purchase order to WEC on May 22, 2019. The purchase

order that Hardy issued to WEC expressly stated that WEC would "provide all of the

design, engineering, project management, equipment, and labor" in the construction of

an ISO 7 compliant cleanroom for Hardy at the agreed upon price stated above. There

is no dispute that, when taken together, the above proposal and purchase order

constituted a valid and binding contract between WEC and Hardy that obligated WEC to

construct an ISO 7 cleanroom for Hardy in accordance with "nationally accepted

practices." There is also no dispute that the contract between WEC and Hardy required

the cleanroom that WEC was to build for Hardy be "tested in accordance with accepted

industry standards" to ensure that it was ISO 7 compliant.

{¶ 5} The ISO standards provide that cleanrooms like ECA 2, the cleanroom that

1. Pursuant to Table 1 included in the ISO 14644-1 document, a cleanroom certified as meeting ISO 7 standards allow for a maximum concentration limit of 352,000 particles of .5 microns or larger; a maximum concentration limit of 83,200 particles one micron or larger; and a maximum concentration limit of 2,930 particles five microns or larger. -3- Warren CA2023-12-109

WEC had been contracted to design and build for Hardy in Springboro, may be tested for

compliance at various points in their construction and operation. This includes (1) the "as

built" stage where construction is complete but with no equipment or personnel present

within the room; (2) the "at rest" stage where construction is complete and equipment is

installed in the room and ready to operate; or (3) the "in operation" stage where

construction is complete and equipment and personnel are present and performing

operations in the room. The record indicates that WEC's standard practice was to test

the cleanrooms it constructed in the "as built" stage. This was no different for WEC with

the construction of ECA 2 for Hardy.

{¶ 6} On March 12, 2020, WEC began its "as built" testing of ECA 2 to ensure it

was ISO 7 compliant pursuant to the terms of the contract it had entered into with Hardy.

However, as the testing progressed, Bodie Choate, a process engineer employed by

Hardy was present for the testing and took his own measurements within ECA 2 that

returned low ACH and air pressure readings. Given the low ACH and air pressure

readings that he received, Choate questioned whether the "as built" testing of ECA 2

would ultimately pass as ISO 7 compliant, but that ECA 2 would nevertheless fail "later

down the road" once Hardy's equipment and personnel were in the room performing

operations. Therefore, based upon Choate's measurements, Aaron Buckley, Hardy's

director of manufacturing, shut down WEC's testing prior to its completion so that further

discussions between Hardy and WEC could take place.

{¶ 7} On March 25, 2020, WEC sent Hardy two "order options" with proposed

upgrades to the HVAC system that it had installed for ECA 2. WEC sent this proposal to

Hardy in hopes of satisfying its demand requiring ECA 2 to achieve a certain ACH rate at

the "in operation" testing stage. WEC did this despite maintaining that the higher ACH

rate being demanded by Hardy was not a requirement that ECA 2 needed to achieve

-4- Warren CA2023-12-109

before it could be certified as ISO 7 compliant. Hardy did not accept either of WEC's

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Cite This Page — Counsel Stack

Bluebook (online)
2024 Ohio 3051, 251 N.E.3d 221, Counsel Stack Legal Research, https://law.counselstack.com/opinion/w-environmental-corp-of-ohio-v-hardy-diagnostics-ohioctapp-2024.