United States District Court, M.D. Louisiana
RULING AND ORDER
A. JACKSON, CHIEF JUDGE
the Court is the First Amended Motion for Summary Judgment
(Doc. 64) filed by Defendant Petro-Valve, Inc. Also before the
Court is the Motion for Summary Judgment (Doc. 68) filed by
Plaintiff Bayou Industrial Sales, LLC ("Bayou") and
the Motion to Strike Plaintiffs Summary Judgment Evidence
(Doc. 76) filed by Defendant. For the following reasons, the
First Amended Motion for Summary Judgment (Doc. 64) filed by
Petro-Valve, and the Motion for Summary Judgment (Doc. 68)
filed by Bayou are GRANTED IN PART and DENIED IN PART, and
the Motion to Strike (Doc. 76) is DENIED.
following facts are undisputed unless otherwise noted.
Petro-Valve distributes industrial valves, (Docs. 64-1 and
80-1 at ¶ 1), and Kevin Foote, David Foote, and Kevin
Barre are sales representatives. Id. at ¶ 2. In
early 2014, Petro-Valve began negotiating with the three
salesmen to work for Petro-Valve in Louisiana. Id.
at ¶ 3. As negotiations progressed, Petro-Valve's
accountant suggested that Kevin Foote, David Foote, and Barre
each form their own limited liability companies that would
then become members of a single limited liability company
that would contract with Petro-Valve. (Doc. 68 at ¶12
and Doc. 75 at ¶ 12). The accountant suggested this
arrangement because it would allegedly offer favorable tax
benefits. (Doc. 68-3 at 66:1-2).
April 21, 2014, Bayou and Petro-Valve executed a consulting
agreement (the "Contract"), in which Bayou agreed
to provide "outside sales services" to Petro-Valve,
for a base payment of $42, 083.33 a month, which is $505, 000
a year. (Doc. 64-3). Keith Foote testified that Petro-Valve
and Bayou arrived at this figure based on a yearly salary of
$200, 000 for Kevin Foote, $180, 000 for Barre, and $125, 000
for David Foote. (Doc. 64-38 at 135:16:20).
also agreed to pay Bayou a 10% commission, up to $1, 500 a
month for "entertainment, " $1, 000 a month for
vehicle mileage/gas, $100 a month cell phone reimbursement,
and $1000 a month for health insurance "per
consultant." (Doc. 64-3 at p.l). The Contract, however,
does not specify the number or identify of the consultants.
Id. The Contract had a three-year term. Id.
The Contract also contains two provisions relating to its
• Extended Payment for Services: In the
event this consulting agreement is terminated, consultant
will receive 6 months of base payment. Should the consultant
engage in a business that is a conflict of interest, the
extended payment will cease.
• Full Time Employment Status: In the
event this consulting agreement is terminated and full time
employment status is offered, there will be
no renegotiation of the base payment and commission rate as
Id. at p. 2 On May 2, 2014, Bayou filed amended
articles of incorporation, identifying its members as David
Foote Consulting, LLC, Keith Foote, LLC, and Barre Industrial
Sales, LLC. (Doc. 68-1 and 75 at ¶ 26). A little over
two months later, on July 9, 2014, Barre informed Petro-Valve
that he was resigning from Bayou. Id. at ¶ 37.
After that, Bayou invoiced Petro-Valve $27, 083.34 a month
for August, September and October of 2014, rather than the
$42, 083.33 a month the Contract provided. (Doc. 64-1 and
80-1 at ¶ 31). Bayou reduced the payment it invoiced
Petro-Valve based on what Bayou had paid Barre each month.
(Doc. 64-39 at 58:13:25). Petro-Valve paid these invoices.
(Doc. 64-1 and 80-1 at ¶ 33).
September 29, 2014, David Bash, a Petro-Valve manager,
emailed David and Keith Foote, cancelling the Contract. (Doc.
64-12 at p. 1-2). He wrote that it "should have been
cancelled when [Barre] departed" and that "[t]he
new employment agreement we have been discussing will be
effective today, upon cancellation of the [contract]."
Id. at p. 1. David Foote responded that if
Petro-Valve wanted "to modify the Contract and eliminate
Barre's portion from the Contract and keep the rest of
the plan in place ... we would be willing to sign
that[.]" Id- at p. 1.
rather than modify the Contract, Kevin and David Foote became
Petro-Valve employees. On October 6, 2014, Kevin and David
Foote signed employment agreements with Petro-Valve, and the
agreements were back-dated to October 1, 2014. (Docs. 64-16
and 64-17) Keith Foote's yearly salary under the
employment agreement was $200, 000.00 and David Foote's
salary was $125, 000.00. Id. Like the Contract, the
commission rate was 10% and the agreement provided for
expense reimbursements for entertainment of up to $1500 per
month, mileage/gas up to $1000 per month, cell phone up to
$100 per month, as well as $1000 per month for health
insurance. Id. Kevin and David Foote worked for
Petro-Valve until April 9, 2015. (Docs. 64-1 and 80 at ¶
claims that Petro-Valve is liable for: (1) $1, 289, 280.32 in
unpaid base payments for the remaining three years on the
Contract; (2) another six months of base payments totaling
$252, 499.98 because Bayou did not engage in business that
was a conflict of interest; (3) $44, 999.97 in unpaid base
payments for the period between April 21, 2014 (the effective
date of the contract) and September 29, 2014 (the date
Petro-Valve terminated the contract); and (4) $62, 000 in
health insurance premiums. (Doc. 60 at ¶ 11-14).
filed suit in the 19th Judicial District Court,
East Baton Rouge Parish, Louisiana on April 9, 2015. (Doc.
1-2). Invoking the Court's diversity jurisdiction,
Petro-Valve removed the case on May 3, 2015. (Doc.
judgment is appropriate "if the movant shows that there
is no genuine dispute as to any material fact and that the
movant is entitled to a judgment as a matter of law."
Fed.R.Civ.P. 56(a). "[W]hen a properly supported motion
for summary judgment is made, the adverse party must set
forth specific facts showing that there is a genuine issue
for trial." Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 250 (1986) (quotation marks
and footnote omitted).
determining whether the movant is entitled to summary
judgment, the Court "view[s] facts in the light most
favorable to the non-movant and draw[s] all reasonable
inferences in her favor." Coleman v. Houston Indep.
Sch. Dist., 113 F.3d 528, 533 (5th Cir. 1997) (citing
Brothers v. Klevenhagen, 28 F.3d 452, 455 (5th
Cir.1994)). At this stage, the Court does not evaluate the
credibility of witnesses, weigh the evidence, or resolve
factual disputes. Int'l Shortstop, Inc. v.
Rally's, Inc., 939 F.2d 1257, 1263 (5th Cir. 1991),
cert, denied, 502 U.S. 1059 (1992). However, if the
evidence in the record is such that a reasonable jury,
drawing all inferences in favor of the non-moving party,
could arrive at a verdict in that party's favor, the
motion for summary judgment must be denied. Int'l
Shortstop, Inc., 939 F.2d at 1263. On the other hand,
the non-movant's burden is not satisfied merely upon a
showing of "some metaphysical doubt as to the material
facts, by conclusory allegations, by unsubstantiated
assertions, or by only a scintilla of evidence."
Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th
summary judgment is appropriate if, "after adequate time
for discovery and upon motion, [the non-movant] fails to make
a showing sufficient to establish the existence of an element
essential to that party's case, and on which that party
will bear the burden of proof at trial." Celotex
Corp. v. Catrett, 477 U.S. 317, 322 (1986). Summary
judgment will He only "if the pleadings, depositions,
answers to interrogatories, and admissions on file, together
with affidavits if any, show that there is no genuine issue
as to any material fact, and that the moving party is
entitled to judgment as a matter of law." Sherman v.
Hallbauer, 455 F.2d 1236, 1241 (5th Cir. 1972). III.
DISCUSSION Before addressing the merits of the cross-motions
for summary judgment, the Court will address Petro-
Valve's Motion to Strike twenty-three paragraphs
contained in Keith and David Foote's
declarations. (Doc. 76-1).
Petro-Valve objects to seventeen paragraphs in the
declarations because they purportedly contain self-serving or
argumentative statements. (Doc. 76-1 at p. 3-5). The United
States Court of Appeals for the Fifth Circuit has held that
"[a] party's own testimony is often self-serving,
but we do not exclude it as incompetent for that reason
alone." C.R. Pittman Const. Co. v, Nat'l Fire
Ins. Co. of Hartford,453 Fed.Appx. 439, 443 (5th Cir.
2011) (internal quotations omitted). Indeed, as long as an
affidavit is based on personal knowledge, contains factual
assertions, and meets the usual requirements for
admissibility, it may ...