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Global Data Systems, Inc. v. World Health Industries, Inc.

United States District Court, W.D. Louisiana, Lafayette Division

February 28, 2018




         This matter comes before the court by consent of the parties pursuant to 28 U.S.C. § 636. Global Data Systems, Inc. contends that it is entitled to be paid for services rendered to World Health Industries, Inc., together with a penalty for early termination of its contract with World Health, attorneys' fees, and costs. Global Data filed a motion for partial summary judgment (Rec. Doc. 39), in which it seeks judgment as a matter of law on four specific issues. World Health opposed the motion on every issue. (Rec. Doc. 48). Oral argument was held on February 22, 2018. Considering the evidence, the law, and the arguments of the parties, and for the reasons fully explained below, the motion is DENIED.


         At some point in 2014, representatives of Global Data traveled to Jackson, Mississippi to meet with Jerome Beasley and others with regard to the possibility of providing telecommunications services to a potential client. An agreement was reached, and services and equipment were provided. Following the early termination of the business relationship, however, a dispute arose concerning the amount owed by the client to Global Data. This lawsuit arose out of that dispute.

         In this lawsuit, Global Data seeks to recover sums it claims are owed to it by World Health pursuant to their alleged contractual relationship. Global Data claims that it agreed to provide World Health with equipment and services for the purpose of improving World Health's telecommunication services with related pharmacies. Global Data contends that a contract was created, through offer and acceptance, when it sent proposals to World Health that were accepted by World Health's representative, Jerome Beasley. Global Data claims that World Health failed to pay approximately $75, 000 that was owed under the contract and further contends that it is also entitled to recover a fee of approximately $340, 000 for World Health's alleged early termination of the contract. Each of the proposals that was accepted by Mr. Beasley indicated that it was subject to certain terms and conditions located on Global Data's website. Those terms and conditions allegedly include an early termination charge.

         World Health contends, to the contrary, that it does not owe any sum to Global Data because any contract Global Data might have entered into was with a wholly separate company called Rx Pro Compounding & Pharmacy, Inc., because Mr. Beasley had no authority to bind World Health, because no contract was entered into by World Health, and because the early termination fee and the other terms and conditions referenced on Global Data's proposals were not retrievable from the internet address listed on the proposals.


         A. The Summary Judgment Standard

         Under Rule 56(a) of the Federal Rules of Civil Procedure, summary judgment is appropriate when there is no genuine dispute as to any material fact, and the moving party is entitled to judgment as a matter of law. A fact is material if proof of its existence or nonexistence might affect the outcome of the lawsuit under the applicable governing law.[1] A genuine issue of material fact exists if a reasonable jury could render a verdict for the nonmoving party.[2]

         The party seeking summary judgment has the initial responsibility of informing the court of the basis for its motion and identifying those parts of the record that demonstrate the absence of genuine issues of material fact.[3] If the moving party carries its initial burden, the burden shifts to the nonmoving party to demonstrate the existence of a genuine issue of a material fact.[4] All facts and inferences are construed in the light most favorable to the nonmoving party.[5]

         If the dispositive issue is one on which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by pointing out that there is insufficient proof concerning an essential element of the nonmoving party's claim.[6] The motion should be granted if the nonmoving party cannot produce evidence to support an essential element of its claim.[7]

         B. Louisiana Law Applies

         A federal court sitting in diversity must apply state substantive law and federal procedural law.[8] Because this is a diversity case, Louisiana's substantive law must be applied.[9] To determine Louisiana law, federal courts look to the final decisions of the Louisiana Supreme Court.[10] When the state's highest court has not decided an issue, the court must make an “Erie guess” as to how the state supreme court would decide the issue.[11] In making such a guess, the federal court may rely upon state appellate court decisions, unless persuasive data convinces the court that the state supreme court would decide the issue differently.[12] When making an Erie guess concerning Louisiana law, the Fifth Circuit relies upon “(1) decisions of the [Louisiana] Supreme Court in analogous cases, (2) the rationales and analyses underlying [Louisiana] Supreme Court decisions on related issues, (3) dicta by the [Louisiana] Supreme Court, (4) lower state court decisions, (5) the general rule on the question, (6) the rulings of courts of other states to which [Louisiana] courts look when formulating substantive law and (7) other available sources, such as treatises and legal commentaries.”[13]

         Accordingly, Louisiana law must be applied in deciding some of the issues currently before the court, including whether Global Data and World Health entered into a binding contract and whether Jerome ...

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