Wells Fargo Bank NA v. LaSalle Bank National Association

Filing 540

ORDER granting in part 534 Motion to Set Schedule and Procedure for Determining Plaintiff's Remedy; denying 538 Plaintiff's Motion to Strike Defendant's Submission in Response to Plaintiff's Motion to Set Schedule and Procedure for Determining Plaintiff's Remedy.. Signed by Honorable Robin J. Cauthron on 8/23/11. (lg, )

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF OKLAHOMA

(1) WELLS FARGO BANK, N.A.
as Trustee for the Certificateholders of
Commercial Mortgage Pass-Through
Certificates, Series 2006-MF2 and
2006-MF3, acting by and through
Crown NorthCorp, Inc., as
Special Servicer,
Plaintiff,
vs.
LaSALLE BANK NATIONAL
ASSOCIATION,
Defendant.

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Case No. CIV-08-1125-C

MEMORANDUM OPINION AND ORDER
I. INTRODUCTION
Plaintiff Wells Fargo Bank (“Wells Fargo”) brought suit, in its capacity as Trustee for
certificateholders of commercial mortgage-backed securities, against Defendant LaSalle
Bank National Association (“LaSalle”)1 seeking damages and specific performance, pursuant
to the Mortgage Loan Purchase Agreement (“MLPA”), requiring Defendant LaSalle to
repurchase three loans contained within the securities. On December 27, 2010, the Court
bifurcated the liability and damages phases of the present action, and on June 14, 2011, a jury
unanimously found that LaSalle breached Warranties 13, 23, and 35 regarding the Royal Oak

1

In May 2008, LaSalle was acquired by Bank of America and subsequently assumed its
name. For purposes of this Order, the Court will continue to refer to Defendant as LaSalle.
(Pl.’s Am. Compl., Dkt. No. 41, at 5; Def.’s Br., Dkt. No. 267, at 7.)

and Hillandale Loans. In the Bifurcation Order, the parties agreed that “[i]f the jury returns
a verdict finding that LaSalle is liable on one or more of Wells Fargo’s claims as described
in paragraph 1(i) and 1(ii) above, the Court will determine whether the appropriate remedy
is specific performance or money damages[.]” (Order, Dkt. No. 330, at 3.) Plaintiff now
moves this Court to set a schedule and procedure for determining its remedy. The parties
disagree about several issues regarding the damages phase of the present action. Specifically,
the parties disagree as to the following issues: (1) whether Plaintiff is entitled to specific
performance; (2) whether the purchase price clause in the parties’ contract is a liquidated
damages provision; (3) whether Plaintiff’s alleged failure to mitigate can be used to offset
a damages award; and (4) how Plaintiff must prove its attorneys’ fees and other expenses for
which it seeks reimbursement. Each issue will now be discussed in turn.
II. DISCUSSION
A. Specific Performance
Under the MPLA and PSA, LaSalle’s obligation to repurchase a loan is triggered by
a breach of warranty. (Pl.’s Br., Dkt. No. 534 Ex. 2 § 6(e); Def.’s Br., Dkt. No. 280 Ex. 1
§ 2.03(b).) Under the PSA, the price at which LaSalle must repurchase loans is set at the
purchase price under § 1.01. (Pl.’s Br., Dkt. No. 534 Ex. 2 § 6(e) (“The ‘Repurchase Price’
with respect to any Mortgage Loan or REO Loan to be repurchased pursuant to this
Agreement and Section 2.03 of the Pooling and Servicing Agreement, shall have the meaning
given to the term ‘Purchase Price’ in the Pooling and Servicing Agreement.”); Def.’s Br.,
Dkt. No. 280 Ex. 1 § 1.01.) Specifically, the purchase price is the sum of the principal
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balance of the loan, the interest due at the mortgage rate, the outstanding advances and
advance interest, reasonable legal fees and expenses incurred, and a liquidation fee. (Def.’s
Br., Dkt. No. 280 Ex. 1 § 1.01.) Plaintiff urges that the contract and relevant commercial
mortgage-backed securities (“CMBS”) case law require that the purchase price be utilized
to determine its damages. As support for its argument, Plaintiff cites LaSalle Bank National
Ass’n v. Capco American Securities Corp., No. 02 CV 9916(RLC), 2005 WL 3046292
(S.D.N.Y. Nov. 14, 2005); LaSalle Bank National Ass’n v. Lehman Brothers Holdings, Inc.,
237 F. Supp. 2d 618 (D. Md. 2002); Resolution Trust Corp. v. Key Financial Services, Inc.,
280 F.3d 12 (1st Cir. 2002); and Morgan Guaranty Trust Co. v. Bay View Franchise
Mortgage Acceptance Co., No. 00 CIV. 8613 (SAS), 2002 WL 818082 (S.D.N.Y. April 30,
2002).
Plaintiff argues that the purchase price clause was negotiated by the parties because
the amount of damages caused by a breach of warranty would be difficult to calculate;
therefore, the parties negotiated the amount of damages that Plaintiff would suffer should
such a breach occur, regardless of whether Defendant could actually repurchase the loan.
Plaintiff argues that requiring actual repurchase of the mortgages would cause depreciation
of the property during the years of litigation potentially necessary to determine whether
Defendant’s repurchase obligation had been triggered.

Additionally, Plaintiff cites

Resolution Trust, 280 F.3d 12, as support for its argument that even though the mortgages
at hand have actually been foreclosed upon and the properties sold—therefore, rendering
actual repurchase impossible—the purchase price is the correct measure of damages.
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In Resolution Trust, despite finding that several loans had gone “off-line” because the
mortgages were removed from the portfolio due to foreclosure or sale, the court found that
the purchase price remained the appropriate measure of damages because that contract
provision “shift[ed] the risk to the selling party in the event that a dispute ar[ose].”
Resolution Trust, 280 F.3d at 18. Also citing Resolution Trust, 280 F.3d 12, the court in
LaSalle v. Lehman Brothers, 237 F. Supp. 2d 618, found that the purchase price was the
appropriate remedy for Lehman Brothers’ breaches of warranty under the parties’ PSA,
despite the possibility that Lehman Brothers would not be able to actually buy back the
mortgages due to a pending bankruptcy action. Lehman Bros., 237 F. Supp. 2d at 638
(stating that even “if it is not possible for defendant Lehman to repurchase the . . . mortgage
loan because of the pending bankruptcy proceedings, plaintiff may still recover traditional
contract damages in this case,” and determining those damages by utilizing the
purchase-price calculation).
Defendant argues that Plaintiff actually seeks specific performance, to which it is not
entitled for two reasons: (1) actual repurchase of loans at issue is impossible due to
foreclosure of loans; and (2) Plaintiff has failed to make the required showing that monetary
damages are an inadequate remedy. The Court agrees with Defendant that Plaintiff would
not be entitled to the “extraordinary remedy” of specific performance—because Plaintiff
seeks only monetary damages and the repurchase of the mortgage loans at issue is
impossible—but, as demonstrated in the above-referenced case law, this finding does not
foreclose that the appropriate method of calculating damages is purchase price. See Barton
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Group, Inc. v. NCR Corp., ___ F. Supp. 2d ___, 2011 WL 2555855, at *27 (S.D.N.Y. June
27, 2011) (“Moreover, specific performance is an ‘extraordinary’ remedy for which the
requesting party ‘must demonstrate that remedies at law are incomplete and inadequate to
accomplish substantial justice.’” (quoting Lucente v. Int’l Bus. Machs. Corp., 310 F.3d 243,
262 (2d Cir. 2002))).
The CMBS case law and the parties’ contract make clear that a “repurchase provision
is designed to shift the risk to the selling party in the event that a dispute arises,” and that
such a provision is the appropriate method of making Plaintiff whole once a breach of
warranty is established. Resolution Trust, 280 F.3d at 18 (“[T]he district court was free to
make Home Owners whole, and it did so in terms of the obligation imposed by the
contract.”); Lehman Bros., 237 F. Supp. 2d at 638-39 (calculating damages by use of the
parties’ purchase price clause and citing Resolution Trust); Capco, 2005 WL 3046292, at *5
(“The parties agreed to a method of calculating the repurchase price. . . . By awarding
damages in the amount that Capco agreed to pay in the event of breach, the court will make
LaSalle whole.”). Accordingly, the Court finds that the purchase price is the correct method
of determining Plaintiff’s damages caused by Defendant’s breaches of warranties.
B. Liquidated Damages Clause
Plaintiff asks this Court to construe the purchase price provision in the parties’
contract as a liquidated damages clause citing LaSalle National Bank Ass’n v. Capco
American Securities Corp., No. 02 CV 9916(RLC), 2005 WL 3046292 (S.D.N.Y. 2005), as
support. Besides this case, Plaintiff points to no other CMBS case law where such a
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provision has been so interpreted, nor does Plaintiff establish that it has satisfied the
prerequisites to enforcement of such a clause. And while it is true that the court in Capco
found that “the parties provided for liquidated damages,” it did not address the requirements
of a liquidated damages clause nor the specifications of when such a clause could be
appropriately used. See Capco, 2005 WL 3046292, at *5-6 (twice using the term “liquidated
damages” to describe the repurchase clause, stating “[t]his clause provides for liquidated
damages in the event that a breach cannot be cured. . . . Allowing a party to ‘cure’ by
tendering a cash payment when the parties provided for liquidated damages in this event is
contrary to the parties’ manifested intentions.” (emphases added)).
Defendant counters that this provision cannot be a liquidated damages clause because
it fails two prerequisites of enforcement of such clauses: (1) that the clause be for “an
amount certain;” and (2) that the amount of damages be difficult to determine. See
Wilmington Trust Co. v. Aerovias de Mexico, S.A. de C.V., 893 F. Supp. 215, 218 (S.D.N.Y.
1995) (“In order for a court to enforce a liquidated damages clause under New York law, the
clause must specify a liquidated amount which is reasonable in light of the anticipated
probable harm, and actual damages must be difficult to ascertain as of the time the parties
entered into the contract.”); Truck Rent-A-Ctr. v. Puritan Farms 2nd, 41 N.Y.2d 420, 424-25
(1977) (“If, however, the amount fixed [by a liquidated damages clause] is plainly or grossly
disproportionate to the probable loss, the provision calls for a penalty and will not be
enforced.”).

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Disagreeing with Plaintiff that a liquidated damages clause may be a formula, rather
than a set numeral amount, Defendant argues that the formula in the purchase price contains
too many elements that are not susceptible to ready, undisputed calculation. Therefore,
Defendant asserts, such a formula cannot be for an amount certain which precludes this
provision from being a liquidated damages clause. Specifically, Defendant points to the
following language as requiring a determination of reasonableness:
all reasonable out-of-pocket expenses reasonably incurred or to be incurred by
the Master Servicer, the Special Servicer, the Depositor and the Trustee in
respect of the Breach of Defect giving rise to the repurchase obligation,
including any expenses arising out of the enforcement of the repurchase
obligation, including, without limitation, all legal fees and expenses any
expenses of the Trust Fund relating to such Mortgage Loan[.]
(Def.’s Br., Dkt. No. 280, Ex. 1, at 39 (emphases added).) Reasonableness requires a
determination by a court, which, Defendant argues, precludes this clause from satisfying the
requirement of being for an amount certain. The Court agrees. Under this provision, Plaintiff
is only entitled to recover costs that are reasonable, which is not susciptible to an amount
certain. Nor is it likely that the parties would agree on the reasonableness of such costs,
which necessitates an outside determination. See Chateau D’If Corp. v. City of New York,
641 N.Y.S.2d 252, 254 (App. Div. 1996) (“The function of a liquidated damages clause is
to resolve the damage question without further dispute by setting an arbitrary approximation
of damages . . . .”). Additionally, Defendant points to the PSA’s language that Crown must
adhere to a servicing standard as support for its assertion that the purchase price is not a
liquidated damages clause and that Plaintiff must mitigate its damage.

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Because Plaintiff relies on only one case as support for its conclusion, it does not
explain why damages would be difficult to calculate or why the contract’s language requiring
an assessment of reasonableness is for a certain amount, the Court is not persuaded by
Plaintiff’s argument that the purchase price is a liquidated damages clause. While the Court
agrees that such clauses need not be labeled “liquidated damages” in order to be valid, it does
not find that the purchase price satisfies the requirements of a liquidated damages clause.
(Pl.’s Br., Dkt. No. 534, at 8 (citing Lease Corp. of Am. v. Resnick, 732 N.Y.S.2d 266, 26869 (App. Div. 1991).) Accordingly, the purchase price provision is not a liquidated damages
clause; this conclusion, however, does not disrupt the prior finding that such clause is the
appropriate method of calculating damages so as to make Plaintiff whole.
B. Failure to Mitigate
Plaintiff also moves for an order that any award of damages to which it is entitled
should not be offset by its failure to mitigate damages. As support, Plaintiff again cites
LaSalle Bank National Ass’n v. Capco American Securities Corp., No. 02 CV 9916(RLC),
2005 WL 3046292 (S.D.N.Y. Nov. 14, 2005); LaSalle Bank National Ass’n v. Lehman
Brothers Holdings, Inc., 237 F. Supp. 2d 618 (D. Md. Dec. 9, 2002); and Resolution Trust
Corp. v. Key Financial Services, 280 F.3d 12 (1st Cir. 2002).2 Plaintiff interprets all of these

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Plaintiff cites additional case law which prohibits offsetting a damages award for a
failure to mitigate, but these cases concluded as much due to a finding that the parties had a valid
liquidated damages clause. Because the purchase price is not considered a liquidated damages
clause, this case law is not discussed.
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cases as establishing that mitigation of damages is not considered in a CMBS action when
determining damages under a repurchase clause.
Defendant disagrees that Resolution Trust did not consider a mitigation defense and
cites the First Circuit’s affirmation of the district court’s ruling, which included in its analysis
of damages “the present value of the repurchase price on the day of the breach, plus other
reasonable costs and expenses incurred after the breach, minus sums received or that
reasonably could have been garnered to mitigate the damages.” F.D.I.C. v. Key Fin. Servs.,
Inc., No. 89-2366-DPW, 1999 WL 34866812, at *12 (D. Mass. Dec. 23, 1999) (emphasis
added), aff’d, Resolution Trust, 280 F.3d 12. Additionally, as support for its argument that
a mitigation defense can be used to offset the amount of the award to which Plaintiff is
entitled, Defendant cites Trust for the Certificate Holders of the Merrill Lynch Mortgage
Pass-Through Certificates Series 1999-C1 v. Love Funding Corp., No. 04 Civ. 9890(SAS),
2005 WL 2582177 (S.D.N.Y. Oct. 11, 2005); and LaSalle Bank Nat’l Assoc. v. Nomura
Asset Cap. Corp., 846 N.Y.S. 2d 95, 99 (App. Div. 2007).
After reviewing the above-cited cases, the discord as to the extent CMBS case law
allows a full mitigation of damages defense is evident. In Nomura, 846 N.Y.S. 2d 95, the
New York court stated, when evaluating damages, that
[t]he critical issue is whether or to what extent plaintiff unreasonably delayed
in notifying defendants of the claimed breaches, [providing the required
prompt notice,] or in taking other necessary steps to protect the value of the
investment property, thereby unreasonably failing to mitigate damages, so as
to preclude any award of damages.

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Nomura, 846 N.Y.S. 2d at 99 (emphasis added). Additionally, the Nomura court admitted
that both parties in that action “recognize[d] . . . a mitigation of damages approach” was the
“operative analysis.” Id. Also cited as support for allowing mitigation of damages in CMBS
repurchase cases is Love Funding Corp., which stated that “to the extent that through its own
delay [the plaintiff] aggravated its injuries stemming from Love Funding’s breach, which
presents an issue of fact, the Trust’s recovery should be reduced accordingly.” Love Funding
Corp., 2005 WL 2582177, at *7 n.84. And, finally, F.D.I.C. v. Key Financial Services, Inc.,
is cited as support for applying a general mitigation defense. Key Fin. Servs., Inc., 1999 WL
34866812, at *12. While it is true that the Massachusetts district court did consider
Plaintiff’s mitigation when calculating damages, on appeal the First Circuit stated, after
finding that a repurchase provision shifts the risk to the selling party, that
[f]or this reason, it is irrelevant that the loans may have suffered a loss in value
because of changing market conditions rather than because of the deficiencies
in the loans’ title policies. Section 3.1 obligated Key to repurchase these
faulty mortgages upon demand, meaning that from the moment a proper
repurchase demand was made, Key—not Home Owners—should have borne
the risk of any market fluctuations.
Resolution Trust, 280 F.3d at 18 & n.14. Additionally, while the First Circuit affirmed the
district court’s determination of damages, it made no mention of mitigation nor did it
explicitly include mitigation in its summary of the district court’s calculation of damages.
Id. at 18 n.15 (“In fact, the district court’s calculation of damages merely represents what
Key would have paid Home Owners had it repurchased the loans when it was supposed to
have done so . . . , plus statutory interest from that date, plus the costs of mitigation and

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servicing, less the payments received on account of the loans from the date of demand to the
date of judgment.”). Neither court in Capco, 2005 WL 3046292, nor Lehman Brothers, 237
F. Supp. 2d 618, applied general mitigation as a defense to the defendant’s obligation when
determining damages, pursuant to a purchase price, for breach of warranty.
Recognizing this inconsistency among the case law, the Court finds Capco, Lehman
Brothers, and Resolution Trust more persuasive in finding that a general mitigation defense
is not applicable to present circumstances, because “[a] repurchase provision is designed to
shift the risk to the selling party in the event that a dispute arises.” Resolution Trust, 280
F.3d at 18. However, the parties did not allocate to Defendant the risk of any failure by the
special servicer in servicing the loans post-default. (See Def.’s Br., Dkt. No. 280 Ex. 1 §
3.01; see also Pl.’s Br., Dkt. No. 534 Ex. 4, at 3 (coming to the same conclusion).)
Therefore, to the extent such failure impacted the resulting purchase price Defendant owes
Plaintiff, only that amount should be offset as a failure to mitigate.
C. Attorneys’ Fees
Plaintiff asks this Court to find that an affidavit, as required under Local Rule 54.2,
stating the amount of time spent on the case, the hourly fee actually claimed and usually
charged, and other pertinent factors relating to attorneys’ fees is sufficient to rule on its
sought-for recovery of attorneys’ fees. As support for this minimal showing requirement,
Plaintiff cites two cases from this Court: Southwestern Bell Yellow Pages, Inc. v. R.I.C.
Leasing, Inc., No. CIV-08-1105-C, 2009 WL 2497255 (W.D. Okla. Aug. 17, 2009), and
Gautier v. Jones, No. CIV-08-445-C, 2009 WL 2929338 (W.D. Okla. Sept. 9, 2009).
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Only the latter somewhat addresses whether an affidavit alone is sufficient to establish
reasonable attorneys’ fees. Gautier, 2009 WL 2929338, at *2 & n.* (“The Court finds that
the documentation submitted by Plaintiff in his reply represents a reasonable lodestar amount
for this case. One of Defendant’s main objections in its response was that Plaintiff failed to
properly document the hours spent in litigating this case because only a general affidavit was
attached to the Motion for Attorney’s Fees. However, Plaintiff attached a very detailed
breakdown of how many hours were spent on each activity, thereby rendering moot
Defendant’s arguments on this issue.”). However, as Defendant points out, the plaintiff in
Gautier, who sought attorneys’ fees, filed as an exhibit an invoice of the work performed.
Reply Brief, Gautier, No. CIV-08-445-C (W.D. Okla. June 25, 2009), Dkt. No. 43 Ex. 1.
The former case on which Plaintiff relies simply states that the “Plaintiff is ordered
to submit an affidavit in support of its claim for damages and attorney’s fees within ten
days.” Southwestern Bell, 2009 WL 2497255, at *4. Additionally, Plaintiff relies on the
procedure followed by the court in Capco, 2005 WL 3046292, as support for its argument
that affidavits summarizing the amount of fees are adequate.
Defendant vehemently opposes Plaintiff’s conclusion regarding the sufficiency of
submitting affidavits and, instead, asserts that a party seeking attorneys’ fees must introduce
detailed, contemporaneous time records to establish the reasonableness of the sought-for
amount.

Defendant argues that New York law3 requires the movant “‘to produce

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Defendant argues that New York law governs the present query because of the parties’
choice of law provision. Because this Court has subject matter jurisdiction over the present
action based on diversity jurisdiction, the Erie doctrine applies and matters categorized as
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contemporaneous records of the nature of the work performed, the need for the work, and the
time expended on the work.’” (Def.’s Br., Dkt. No. 535, at 18 (quoting Van Dorn Retail
Mgmt., Inc. v. Jim’s Oxford Shop, Inc., 874 F. Supp. 476, 488-89 (D.N.H. 1994).)
Despite Plaintiff’s assertion otherwise, Local Rule 54.2 does not obscure the
requirement that Plaintiff provide contemporaneous, detailed records of the work performed
in order to receive an award of its attorneys’ fees. While it may be true that the two cases
Plaintiff cites from this Court allowed affidavits as a sufficient showing, this is not the
required practice. See Valley View Angus Ranch, Inc. v. Duke Energy Field Servs., LP, No.
CIV-04-191-D, 2009 WL 2778912, at *1 & n.2 (W.D. Okla. Aug. 28, 2009). Nor is such a
minimal showing sufficient here, where the attorneys’ fees are likely to be the bulk of the

substantive are governed by the forum state law and those categorized as procedural are
governed by federal law. Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938). “‘[I]n diversity cases
generally, and certainly in this circuit, attorney fees are determined by state law and are
substantive for diversity purposes.’” Qulds v. Prin. Mut. Life Ins. Co., 6 F.3d 1431, 1445 (10th
Cir.1993) (alteration in original) (quoting King Res. Co. v. Phoenix Res. Co., 651 F.2d 1349,
1353 (10th Cir. 1981)). Defendant argues that Rule 54 of the Federal Rules of Civil Procedure
and Local Rule 54.2 are inapplicable because attorneys’ fees are a substantive element of
Plaintiff’s claim for damages under the purchase price in the PSA. Plaintiff argues that while the
issue of whether a party is entitled to attorneys’ fees is a substantive question, the calculation of
such fees and rules governing that calculation are procedural. However, because either
applicable law requires contemporaneous, detailed records, any distinction of applicability
between the two for the present inquiry is limited; therefore, the Court can avoid entering this
thicket for present purposes. Compare Case v. Unified Sch. Dist. No. 233, Johnson Cnty., 157
F.3d 1243, 1250 (10th Cir. 1998) (requiring “meticulous, contemporaneous time records that
reveal, for each lawyer for whom fees are sought, all hours for which compensation is requested
and how those hours were allotted to specific tasks”), and Usrey v. Wilson, 2003 OK CIV APP
25, ¶ 6 & n.3, 66 P.3d 1000, 1002 & n.3 (stating that counsel “would be well-advised to keep
contemporaneous time records for use in presenting an application for attorney fees”), with
Regan v. Conway, 768 F. Supp. 2d 412, 418-19 (E.D.N.Y. 2011) (declining to award attorneys’
fees that were not contemporaneously recorded), and Daimlerchrysler Corp. v. Karman, 782
N.Y.S.2d 343, 347 (Sup. Ct. 2004).
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damages awarded and both parties have shown a propensity for extraneous and loquacious
filings. While Plaintiff needs to provide contemporaneous and detailed records, these records
may be redacted to exclude information within the attorney-client privilege,4 so long as such
redaction does not exclude information needed to assess Plaintiff’s sought-for reasonable
attorneys’ fees.
Additionally, contrary to Plaintiff’s assertion, Defendant has not waived a right to trial
on this matter before the Court; the parties did waive a right to a jury trial in the Bifurcation
Order, but not a bench trial. (Order, Dkt. No. 330, at 3 (“By this stipulation, the parties
hereby waive any right they may have to a jury trial on the issues set forth in Paragraph 3
above.”) (emphasis added).)
III. CONCLUSION
For the above-stated reasons, the Court now PARTIALLY GRANTS Plaintiff’s
Motion to Set Schedule and Procedure for Determining Plaintiff’s Remedy (Dkt. No. 534)
insofar as the parties’ purchase price is the correct method of calculating Plaintiff’s damages.
Additionally, Plaintiff’s Motion to Strike Defendant’s Submission in Response to Plaintiff’s

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Plaintiff’s argument that this Court has previously held such documents were protected
by the attorney-client privilege misconstrues this Court’s finding. In the Order that Plaintiff
cites, the Court simply questioned whether the billing invoices Defendant sought during the
discovery phase were relevant to determine liability. (Order, Dkt. No. 211, at 6-7.) In refusing
to compel disclosure of such documents, the Court found that Plaintiff’s assertion of attorneyclient privilege was sufficient. This finding, however, does not impose a universal protection
over all of Plaintiff’s billing invoices, especially given the current context in which they arise.
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Motion to Set Schedule and Procedure for Determining Plaintiff’s Remedy (Dkt. No. 538.)
is DENIED.5
IT IS SO ORDERED this 23rd day of August, 2011.

5

Defendant filed, to use its description, a “submission” to Plaintiff’s Reply Brief in this
matter. (Def.’s Br., Dkt. No. 537, at 1 n.2.) While the Court considered Defendant’s arguments
and additional support therein, it should be noted that this is not the correct procedure, as
Plaintiff attests in its Motion to Strike Defendant’s Submission in Response to Plaintiff’s Motion
to Set Schedule and Procedure for Determining Plaintiff’s Remedy. (Pl.’s Br., Dkt. No. 538.)
Under Local Rule 7.1, parties must move the Court for leave to file supplemental briefs, and this
Rule applies with equal force to Defendant. LCvR7.1. Despite this procedural failing, the Court
will consider Defendant’s so-called “submission” to save the parties’ and the Court’s time,
energy, and resources. However, Defendant should take note that if it should wish to file a
surreply in the future, it should move for such leave under Local Rule 7.1.
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