Erdman Company et al v. Phoenix Land & Acquisition, LLC et al

Filing 263

ORDER denying 186 Motion for Partial Summary Judgment. Signed by Honorable Susan O. Hickey on February 25, 2013. (lw)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
FORT SMITH DIVISION
ERDMAN COMPANY; and ERDMAN
ARCHITECTURE & ENGINEERING
COMPANY
VS.

PLAINTIFFS

CASE NO. 2:10-CV-2045
Lead case

PHOENIX LAND & ACQUISITION, LLC;
PHOENIX HEALTH, LLC

DEFENDANTS

ERDMAN COMPANY; and ERDMAN
ARCHITECTURE & ENGINEERING
COMPANY

THIRD PARTY PLAINTIFFS

VS.
DATA TESTING, INC.;
OTIS ELEVATOR COMPANY; and

THIRD PARTY DEFENDANTS

______________________________________________________________________________

PHOENIX HEALTH, LLC; and
IPF, LLC
VS.

CONSOLIDATED PLAINTIFFS
CASE NO. 2:11-CV-2067
Member Case

ERDMAN ARCHITECTURE &
ENGINEERING COMPANY; and
OTIS ELEVATOR COMPANY

CONSOLIDATED DEFENDANTS
ORDER

Before the Court is Erdman Company and Erdman Architecture & Engineering
Company’s (together, “Erdman”) Motion for Partial Summary Judgment (Compulsory
Counterclaim). (ECF No. 186). Phoenix Health has responded. (ECF No. 215). The matter is ripe
for the Court’s consideration. For the following reasons, the motion will be denied.

The instant motion concerns a simple question of law—the facts are agreed. “Where the
unresolved issues are primarily legal rather than factual, summary judgment is particularly
appropriate.” Hupp v. U.S. Dep’t of the Army, 144 F.3d 1144, 1146 (8th Cir. 1998).
The dispute concerns the effect of Phoenix Health’s failure to raise certain compulsory
counterclaims against Erdman in the lead case, Erdman v. Phoenix, 2:10-cv-2045. After failing
to raise those counterclaims in the lead case, Phoenix Health raised them as direct claims in the
member case, Phoenix v. Erdman, 2:11-cv-2067. Erdman now moves the Court to dismiss
Phoenix Health’s claims in the member case, arguing that Phoenix Health forfeited those claims
by not raising them as counterclaims in the lead case. The Court finds dismissal inappropriate.
Ordinarily, if a party does not raise a counterclaim that is compulsory under Federal Rule
of Civil Procedure 13(a), the party is barred from raising that claim at a later date. Schinzing v.
Mid-States Stainless, Inc., 415 F.3d 807, 813 (8th Cir. 2005) (citing Polymer Indus. Prods. Co. v.
Bridgestone/Firestone, Inc., 347 F.3d 935, 938 (Fed. Cir. 2003)). Rule 13(a)’s compulsorycounterclaim requirement “was designed to prevent multiplicity of actions and to achieve
resolution in a single lawsuit of all disputes arising out of common matters.” S. Constr. Co. v.
Pickard, 371 U.S. 57, 60 (1962). The rule is underlain by a policy of judicial economy. By-Prod
Corp. v. Armen-Berry Co., 668 F.2d 956, 962 (7th Cir. 1982); Provident Life & Acc. Ins. Co. v.
United States, 740 F. Supp. 492, 496 (E.D. Tenn. 1990).
Under ordinary circumstances, then, Phoenix Health would be barred from raising in the
member case the claims it failed to assert as counterclaims in the lead case. The circumstances of
this case, however, are unordinary. Here the lead case and the member case have been
consolidated (ECF No. 88), so there is no possibility of multiple actions and fractured
proceedings. See Provident Life & Acc. Ins. Co., 740 F. Supp. at 496 (dismissing later-raised

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compulsory counterclaims in consolidated case “would not further any of the policies behind
[Rule] 13(a).”). It would therefore not serve the policy of the rule to dismiss Phoenix Health’s
claims in the member case. Moreover, it would not be “just, speedy, and inexpensive.” Fed. R.
Civ. P. 1
Accordingly, the Court finds that Erdman’s Motion for Partial Summary Judgment
(Compulsory Counterclaim) (ECF No. 186) should be and hereby is DENIED.
IT IS SO ORDERED, this 25th day of February, 2012.

/s/ Susan O. Hickey
Hon. Susan O. Hickey
United States District Judge

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