Rorick v. Service Experts Heating & Air Conditioning LLC et al
Filing
63
Copy of MEMORANDUM OPINION AND ORDER entered in the related case 5:17-cv-131: 1) Dft SEHAC's 40 Motion for Summary Judgment the three remaining claims of fraud, breach of contract, and unjust enrichment in this case and in the related case (5:17-cv-00132) is GRANTED; 2) A Judgment SHALL be forthcoming. Signed by Judge Joseph M. Hood on 10/12/2021. (MDC) cc: COR
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF KENTUCKY
CENTRAL DIVISION at LEXINGTON
PETER CANAVAN NEWBERRY and
KIMBERLY S. RORICK,
Plaintiffs,
v.
SERVICE EXPERTS HEATING & AIR
CONDITIONING LLC,
Defendant.
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** ** ** **
Civil No.
5:17-131-JMH &
5:17-132-JMH
MEMORANDUM OPINION
AND ORDER
**
This matter is before the Court on the Defendant’s Motion for
Summary Judgment. For the reasons stated below, the Court ORDERS
that the Motion (DE 40) is GRANTED and that the Complaints in the
above-action cases are DISMISSED.
I.
The Court and the parties are well familiar with the facts of
this case, so a summary will suffice. Peter Canavan Newberry and
Kimberly S. Rorick (collectively “Plaintiffs”), a married couple,
contacted Defendant Service Experts Heating & Air Conditioning,
LLC (“SEHAC”), on December 7, 2011, to repair their Aqua-Pure
backwash water filter system. SEHAC responded that they did not
service Aqua-Pure products, and instead, offered to sell two other
water filtration units: (1) a TS+ 2000 Easy Water Toxin Shield
backwash water filter for the entire home; and (2) a Revita water
Page 1 of 10
filtration system for the kitchen. SEHAC returned on December 12,
2011 to install the two systems. Orally, SEHAC promised that it
would remove the two systems and reinstall the old Aqua-Pure system
for no charge, at any time and for whatever reason, during the
first year of service if Plaintiffs were not satisfied.
On December 19, 2011, Plaintiffs first contacted SEHAC to
relay
a
series
of
issues
with
their
newly-installed
water
filtration systems; such issues consisted of water leakage, poor
water pressure, and foggy, dark-colored water, to name a few. From
then on, the problems persisted — even worsening. Plaintiffs urged
SEHAC to repair the water filtration systems and to replace the
Easy Water system with the original Aqua-Pure system. In response,
SEHAC told Plaintiffs that it would submit insurance claims for
the defective whole-house system. In the end, however, SEHAC never
returned the Aqua-Pure system, never repaired and/or removed the
faulty systems, and failed to provide monetary compensation.
Growing tired of the futile back-and-forth communications
between them and SEHAC, and SEHAC’s perceived inaction regarding
the submission of insurance claims, Plaintiffs each filed separate
civil
actions
in
state
court
against
SEHAC
and
its
parent
companies, on March 22, 2013. The cases were later removed to the
United States District Court for the Eastern District of Kentucky.
See Newberry v. Serv. Experts Heating and Air Conditioning, et
al., No. 2:13-cv-80-DLB-CJS (E.D. Ky. filed May 7, 2013);
Page 2 of 10
Rorick
v. Serv. Experts Heating and Air Conditioning, et al., No. 2:13cv-81-WOB-CJS (E.D. Ky. filed May 7, 2013). Shortly after removal,
on May 22, 2013, Plaintiff Newberry voluntarily dismissed his case.
On November 13, 2013, the parties in the Rorick case indicated
that they had reached a settlement and filed an agreed order1 of
dismissal.
On March 16, 2017, Plaintiffs Newberry and Rorick, again,
filed two separate actions in this District; however, this time
the
cases
were
filed
in
the
Central
Division
at
Lexington.
Plaintiffs brought twelve causes of action, consisting of many of
the same claims as brought in the prior actions, as well as new
claims for personal injury, injury to real and personal property,
and products liability. Defendants all filed motions to dismiss,
which the Court granted, dismissing all claims against them.
In the case against SEHAC, the Court largely found that
dismissal was appropriate because most of the claims were timebarred. On appeal, however, the Sixth Circuit reversed the Court’s
judgment dismissing Plaintiffs’ claims for fraud (count seven),
The agreed order stated that Plaintiff Rorick would dismiss her
case without prejudice subject to the condition that any subsequent
lawsuit stemming from the parties’ dispute would have to be filed
in the Covington Division of the Eastern District of Kentucky. In
their new Complaints, Plaintiffs explain that Rorick voluntarily
dismissed the initial lawsuit based on representations made by the
defendants’ attorney that no evidence of physical injury to
Plaintiffs existed, and that SEHAC had tested the water from their
home and found it to be safe.
1
Page 3 of 10
breach of contract (count eight), and unjust enrichment (count
nine), and remanded for further consideration. All other aspects
of the Court’s judgment was affirmed. Newberry v. Serv. Experts
Heating & Air Conditioning, LLC, 806 F. App’x 348, 362 (6th Cir.
2020). Relevant to the current issues before the Court, the Sixth
Circuit stated as follows:
[P]laintiffs’ claims for breach of oral contract (and
related claims of unjust enrichment and contract
fraud) have not been shown to be time-barred under
the applicable five-year statutes of limitation.
Plaintiffs allege that they entered into an oral
contract with SEHAC to “properly install, service,
and/or repair the whole house toxin shield water
filtration system.” They further allege that this
contract was entered into on December 12, 2011 and
included a one-year obligation to service the
filtration system.
…
Both parties assume the existence of an oral contract
and agree that each of these three claims is governed
by a five-year statute of limitations. See Ky. Rev.
Stat. §§ 413.120(1), 413.120(11); EQT Prod. Co. v.
Big Sandy Co., LP, 590 S.W.3d 275, 287 (Ky. Ct. App.
2019) (applying
five-year statute-of-limitations
period in Ky. Rev. Stat. § 413.120(11) to unjust
enrichment claims). The parties also appear to agree
that the claims accrued either when defendants
allegedly breached the obligation or when the
obligation was repudiated. This appears to be the law
at least with respect to suits for breach of contract.
EQT Prod. Co., 590 S.W.3d at 292 (citing Hoskins Adm’r
v. Kentucky Ridge Coal Co., 305 S.W.2d 308, 311 (Ky.
1957)); Berger v. Savient Pharms., Inc., No. 2009-CA1858-MR, 2011 WL 4861427, at *4 (Ky. Ct. App. Oct.
14,2011) (citing Upton v. Ginn, 231 S.W.3d 788, 791
(Ky. Ct. App. 2007)). The parties make identical
statute-of-limitations arguments with respect to the
three claims.
…
According to both the earlier and later complaints,
that date is when SEHAC allegedly reiterated its
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promise contained in the December 12, 2011 oral
contract. Neither complaint states that a request to
replace the filtration system was made on that date,
much less that SEHAC breached or repudiated on that
date. The allegation in both complaints that plaintiff
asked for removal of the new system and reinstallation
of the old system is simply undated. Similarly undated
is the subsequent paragraph stating that SEHAC never
returned to remove the new system or reinstate the
older one.
It is thus unclear whether the alleged oral agreement
to remove and replace was breached before or after
March 16, 2012, and thus whether the contract,
contract fraud, and unjust enrichment claims (counts
seven through nine) were time-barred. … Without more,
on the current record, it was premature to dismiss on
limitations grounds the three claims based on the
alleged contractual obligation to remove and replace
upon request.
Newberry, 806 F. App’x at 360-62 (emphasis added).
On remand, after the Sixth Circuit’s mandate had issued and
the Court granted SEHAC’s request to consolidate the Plaintiffs’
actions (DE 39), SEHAC filed the instant Motion for Summary
Judgment.
(DE
40)
As
grounds,
SEHAC
has
attached
additional
evidence (i.e., email correspondence between the parties), which
it argues conclusively proves that the remaining claims accrued
prior to March 16, 2012. Plaintiffs oppose the motion. This matter
is fully ripe for review (see DE 41, 43).
II.
Under Federal Rule of Civil Procedure 56(c), summary judgment
is appropriate “if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
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judgment as a matter of law.” FED. R. CIV. P. 56. The moving party
has the initial burden of demonstrating the basis for its motion
and identifying those parts of the record that establish the
absence of a genuine issue of material fact. Chao v. Hall Holding
Co., Inc., 285 F.3d 415, 424 (6th Cir. 2002). The movant may
satisfy its burden by showing “that there is an absence of evidence
to support the nonmoving party’s case.” Celotex Corp. v. Catrett,
477 U.S. 317, 325 (1986). Once the movant has satisfied this
burden, the nonmoving party must go beyond the pleadings and come
forward with specific facts demonstrating the existence of a
genuine dispute for trial. FED. R. CIV. P. 56; Hall Holding, 285
F.3d at 424 (citing Celotex, 477 U.S. at 324). This is so because
“[o]ne of the principal purposes of the summary judgment rule is
to
isolate
and
dispose
of
factually
unsupported
claims
or
defenses.” Celotex, 477 U.S. at 323-24.
“A genuine dispute exists on a material fact, and thus summary
judgment is improper, if the evidence shows ‘that a reasonable
jury could return a verdict for the nonmoving party.’” Olinger v.
Corp. of the President of the Church, 521 F. Supp. 2d 577, 582
(E.D. Ky. 2007) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 255 (1986)). Stated otherwise, “[t]he mere existence of a
scintilla of evidence in support of the plaintiff’s position will
be insufficient; there must be evidence on which the jury could
reasonably find for the plaintiff.” Anderson, 477 U.S. at 252.
Page 6 of 10
When applying the summary judgment standard, the Court must review
the facts and draw all reasonable inferences in favor of the
nonmoving party. Logan v. Denny’s, Inc., 259 F.3d 558, 566 (6th
Cir. 2001) (citing Anderson, 477 U.S. at 255). The nonmovant “must
do more than show there is some metaphysical doubt as to the
material fact. It must present significant probative evidence in
support of its opposition to the motion for summary judgment.”
Hall
Holding,
285
F.3d
at
424
(internal
citations
omitted).
However, the Court is under “no … duty to search the entire record
to establish that it is bereft of a genuine issue of material
fact.” In re Morris, 260 F.3d 654, 655 (6th Cir. 2001). Rather,
“the nonmoving party has an affirmative duty to direct the court’s
attention to those specific portions of the record upon which it
seeks to rely to create a genuine issue of material fact.” Id.
III.
A.
As an initial matter, the Court briefly addresses Plaintiffs’
arguments in opposition. Plaintiffs first argue that the arguments
that SEHAC brings forth are not timely made, and that SEHAC seeks
to “circumvent” the discovery process by filing the instant motion
(DE 41 at 1, 3). These arguments are unavailing, mere conjecture,
and are not supported by the record. Plaintiffs also argue that
the emails attached to SEHAC’s motion are inadmissible as hearsay
and would not be admissible if offered at trial. (Id. at 5-6).
Page 7 of 10
However, the Court does not question that the emails are properly
authenticated, as Newberry is either the recipient or sender of
each of the emails and there is no challenge to their authenticity.
Nor does Newberry assert that the emails were falsified or altered
in any way. And further, SEHAC has clarified that it is not
offering the emails for the truth of the matter asserted, but
“simply to demonstrate that SEHAC repeatedly informed plaintiffs
before March 16, 2012 that the [original] AquaPure system had been
destroyed and would not be replaced[.]” (DE 43 at 8). Accordingly,
this argument, too, is rejected.
Additionally, the Court rejects Plaintiffs’ attempt to raise
novel arguments regarding the existence of a written contract, and
that a fifteen-year statute of limitations is applicable. (DE 41
at 7). This argument runs counter to the evidence presented and
what the Sixth Circuit concluded on appeal. Finally, to the extent
Plaintiffs seek sanctions and attorney fees against SEHAC based on
its alleged “material representations” and “lack of candor to the
Court” (id., at 10), the Court cannot do so because the request
has not been presented in the form of a motion and not in a
response. See FED. R. CIV. P. 7(b)(1) “( A request for a court order
must be made by motion.”); see also LR 7.1(a) (A motion must state
with particularity the grounds for the motion, the relief sought,
and the legal argument necessary to support it.”). Moreover, in
any case, the Court finds that any motion for sanctions or motion
Page 8 of 10
for attorney fees would lack merit because there is no such support
in the record.
B.
On appeal, the Sixth Circuit concluded that the Court had
prematurely dismissed the claims against SEHAC because it was not
clear from the record when, exactly, the claims accrued because
the Complaints were void of specific dates regarding the breach or
repudiation. The oral contract at issue, required Defendants
“to remove either or both of [the] water filtration
systems and to reinstall Plaintiff's Aqua-Pure system
for no additional charge in the event that Plaintiff
was dissatisfied with the systems that were purchased
from [defendants] ‘at any time during the first year
of service upon request by Plaintiff.’ ”
Newberry, 806 F. App’x at 360-61. The claims accrued either when
defendants
allegedly
breached
the
obligation
or
when
the
obligation was repudiated. Id.
The correspondence between the parties show that, as early as
December 30, 2011, and no later than January 3, 2012, SEHAC made
Plaintiffs aware that it would not reinstall the Aqua-Pure system
because that system had already been disposed of and was no longer
in its possession. See DE 40-5, DE 40-10. In fact, the emails
consistently demonstrate that, despite numerous communications —
all prior to March 16, 2012 — SEHAC never removed the whole-house
system. Nor did it replace it with the old Aqua Pure system, as
it was no longer in existence. These facts are undisputed.
Page 9 of 10
From
this,
it
is
clear
that
SEHAC
indisputably
either
breached or repudiated its obligations under the oral contract to
remove the whole-house system and replace the Aqua-Pure System
before March 16, 2012. Plaintiffs filed suit in this Court on
March 16, 2017. Thus, unfortunately, these claims are time-barred
and SEHAC must be entitled to judgment as a matter of law. Ky.
Rev. Stat. §§ 413.120(1), 413.120(11).
IV.
For the reasons herein stated, the Court ORDERS AS FOLLOWS:
(1) Defendant SEHAC’s Motion for Summary Judgment on
the three remaining claims of fraud, breach of
contract, and unjust enrichment in this case and
in the related case (5:17-cv-00132) is GRANTED;
(2)
A Judgment SHALL be forthcoming.
IT IS SO ORDERED.
This the 12th day of October, 2021.
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