Xcoal Energy & Resources v. Southern Coal Sales Corporation et al
MEMORANDUM ORDER re rulings on the various motions in limine. Signed by Judge Leonard P. Stark on 5/4/17. Associated Cases: 1:14-cv-00459-LPS, 1:15-cv-00267-LPS (ntl)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
SOUTHERN COAL SALES
CORPORATION, ET AL.,
JAMES C. JUSTICE COMPANIES, INC., )
. XCOAL ENERGY & RESOURCES,
XCOAL ENERGY & RESOURCES,
, Civil Action No. 14-459-LPS
Civil Action No. 15-267-LPS
At Wilmington this 4th day of May, 2017, having reviewed the proposed pretrial order
(C.A. No. 15-267 1 D.I. 184) ("PTO"), submitted by Xcoal Energy & Resources et al ("Xcoal")
and Southern Coal Sales Corp. ("SCS") and James C. Justice Companies, Inc. et al. (with SCS,
the "Justice Parties"), including briefing on various motions in limine ("MIL"),
IT IS HEREBY ORDERED that:
All references to the docket index ("D.I.") are to C.A. No. 15-267, unless otherwise
Xcoal's MIL# 1, to preclude evidence of extracontractual representations
allegedly made during negotiations, is DENIED. Even though the parties' contracts are
integrated, the term "rail freight" is ambiguous, and it is not clear that the Justice Parties are
seeking to use extrinsic evidence to "vary" the terms of the written contract. The Court cannot
determille at this point that either side's proposed interpretation is so unreasonable as to require
preclusion of the evidence at issue. See generally Hoyt -y. Andreucci, 433 F.3d 320, 322 (2d Cir.
2006) ("In determining the meaning of the language at issue, the jury may consider extrinsic
evidence such as the parties'_ course of conduct throughout the life of the contract"); Dejana
Indus., Inc. v. Vill. ofManorhaven, 2015 WL 1275474, at *10 (E.D.N.Y. Mar. 18, 2015) (stating
that court may receive "any available extrinsic evidence to ascertain the meaning intended by the
parties during the formation of the contract"); Storwal Int'!, Inc. v. Thom. Rock Realty Co., L.P.,
768 F. Supp. 429, 431 (S.D.N.Y. 1991) (stating that court may consider extrinsic evidence "to
aid in interpreting ambiguous terms of such [i.e., an integrated] contract"). 2 Xcoal is free to
argue at trial, and in post-trial briefing, that the evidence at issue in this motion should be given
little or no weight.
Xcoal's MIL #2, to preclude evidence of allegedly fraudulent representations ·
during the pendency and in the performance of the Coal Supply Agreement ("CSA"), is
DENIED. The Justice Parties intend to use this evidence to support their claim that Xcoal
The Court does not agree with Xcoal'that the Court's statements in denying a request for
leave to file an amended complaint including a claim for fraudulent inducement (see D .I. 106 at
29-30) were so broad as to preclude admissibility of the disputed evidence in connection with the
fraud claim that remains part of the case. The Justice Parties will be provided an opportunity at
trial to attempt to prove that "SCS was justified in believing it was getting Xcoal's true rail rate
and receiving accurate demurrage costs." (D .I. 185-9 at 73 of 88)
committed fraud because it never int~nded to pay, despite contrary representations in purchase
orders. The "source of the dµty" doctrine does not make this evidence inadmissible. Xcoal is
free, to argue at trial, and in post-trial briefing, that the evidence at issue in this motion should be
given little or no weight.
Xcoal's MIL #3, to preclude certain evidence of post-CSA termination damages, is
DENIED. At this stage, Xcoal has not demonstrated that the parties to the CSA would have
reopened their pricing arrangement to renegotiate a new price (or have one determined by a third
party), making Xcoal's principal authority3 not (yet, at least) applicable. Nor is the Court
persuaded that the damages sought by the Justice Parties are so speculative that they cannot
possibly be proven with reasonable certainty.
The Justice Parties' MIL #1, to deem admissible all documents, communications,
and testimony concerning Xcoal' s rail freight, is GRANTED. This motion is essentially the
mirror image of Xcoal' s MIL # 1, so the Court grants this motion for the same reasons it denied Xcoal' s motion.
The Justice Parties' MIL #2, to exclude Xcoal's expert's improper opinions on
contract construction and ambiguity, is DENIED. It is unclear whether the Justice Parties are
seeking to exclude the entirety of Mr. Pergolizzi's opinion; the Justice Parties have plainly failed
to show that the entirety of his proposed testimony is improper. To the extent limited portions of
the opinions Mr. Pergolizzi seeks to express improperly invade the Court's obligation to make
legal determinations (as opposed to properly providing helpful evidence as to how certain terms
See Cibro Petroleum Prod., Inc. v. Sohio Alaska Petroleum Co., 602 F. Supp. 1520,
1544 (N.D.N.Y. 1985), aff'd, 798 F.2d 1421 (Temp. Erner. Ct. App. 1986).
are used in industry, for ex~mple), the Justice Parties may object to particular questions and
at trial and/or move to strike particular testimony in post-trial briefing.
The parties shall be prepared to discuss any remaining disputes in the PTO at tomorrow's
pretrial conference, including their revised request for a specific number of hours for their trial
UNITED STATES DISTRICT JUDGE
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