United States District Court, E.D. Louisiana
PROGRESSIVE WASTE SOLUTIONS OF LA, INC.
SDT, INC. ET AL
ORDER & REASONS
E. FALLON, U.S. DISTRICT COURT JUDGE
the Court is Plaintiff Progressive Waste Solution's
motion to dismiss without prejudice. R. Doc. 63. Defendants
Sidney Torres and SDT Waste & Debris Services, LLC have
filed a response in opposition. R. Doc. 64. For the following
reasons, the Court will DENY the motion.
case arises out of a contract dispute between Plaintiff
Progressive Waste Solutions of LA, Inc. (“PWS”)
and Defendants Sidney Torres and SDT Waste & Debris
Services, LLC, (“SDT”). On February 7, 2007, SDT
entered into a Time Contract with St. Bernard Parish
Government (“St. Bernard”) for both curb side
pick-up services and dumpster pick-up services. The Time
Contract was set to commence on January 28, 2008 and
terminate on January 27, 2014. 16-8669, R. Doc. 1 at 2-3. The
Time Contract also provided SDT the option to extend the
agreement through July 26, 2016. 16-8669, R. Doc. 1 at 3.
of 2011, IESI LA Corporation, now PWS, purchased SDT (the
“Purchase Agreement”), which included the
transfer and assignment of the July 27, 2006 Agreement and
the February 7, 2007 Time Contract. According to the terms of
the Purchase Agreement, SDT and Torres agreed to
“indemnify, defend, protect and hold harmless”
IESI or its successors from any losses, liabilities, or
claims, including costs and expenses, sustained by IESI or a
successor corporation as a result of any intentional
misrepresentations or omissions by SDT or Torres in the
Purchase Agreement. R. 1 at 4. PWS alleges this obligation
includes an obligation to defend IESI in any proceeding that
was instituted after June 1, 2011 if those claims arose out
of any period time before June 1, 2011. R. Doc. 1 at 4.
the purported term of the Time Contract extending to at least
January 27, 2014, St. Bernard informed IESI it intended to
terminate their contractual relationship. On December 5,
2011, St. Bernard again sought bids for curb side pick-up
services and dumpster pick up services. 16-8669, R. Doc. 1 at
3-4. On December 8, 2011, IESI filed a Petition for Temporary
Restraining Order, Preliminary and Permanent Injunction, and
Declaratory Judgment in the Thirty-Fourth Judicial District
Court for the Parish of St. Bernard. 16-8669, R. Doc. 1 at 4.
The state court issued a preliminary injunction on December
14, 2011 and enjoined St. Bernard from requesting bids for
solid waste collection. 16-8669, R. Doc. 1 at 4. One week
later, the state court enjoined St. Bernard from entering
into any new contract for the services currently being
performed by IESI. 16-8669, R. Doc. 1 at 4.
January 12, 2012, IESI changed its name to Progressive Waste
Solutions of LA, Inc. (“PWS”). In May of 2013,
St. Bernard again issued Requests for Proposals inviting
vendors to submit proposals for the waste collection services
being provided by PWS. 16-8669, R. Doc. 1 at 4. In response,
on May 20, 2013, PWS filed a Motion for Contempt and a Second
Supplemental and Amending Petition for Temporary Restraining
Order, Preliminary and Permanent Injunction, and Declaratory
Judgment in state court. 16-8669, R. Doc. 1 at 4-5. Before
the state court could rule on PWS's motion, St. Bernard
agreed to extend the Time Contract through December 31, 2020
and, in turn, PWS reduced its rates from $20.00 per household
per month to $15.50 per household. R. Doc. 1 at 5. Two months
later, PWS and St. Bernard formally entered into a new Time
Contract that extended PWS's provision of solid waste
removal services until December 31, 2020.
19, 2016, St. Bernard wrote to PWS stating it intended to
unilaterally terminate the solid waste services contract on
July 6, 2016. St. Bernard provided two reasons for the
termination: (1) the St. Bernard Home Rule Charter prohibits
contracts for services not covered by public bid law
exceeding three years and (2) alleging PWS breached the
contract by missing residential pickups. 16-8669, R. Doc. 1
at 1-7. PWS filed suit in response, again requesting
injunctive relief and a declaratory judgment. 16-8669, R.
Doc. 1 at 7-9. PWS also sought damages for breach of
contract, detrimental reliance, and deprivation of rights
under color of law. 16-8669, R. Doc. 1 at 9-13. In response,
St. Bernard filed five counter claims against PWS. 16-8669,
R. Doc. 35. In the first of these counterclaims, St. Bernard
alleged a breach of contract claim for overbilling for the
quantity of services performed from August 1, 2006 through
December 31, 2012. 16-8669, R. Doc. 35 at 8-9.
result of St. Bernard's counterclaims, on October 25,
2016, PWS filed the instant suit against SDT, Inc. and Sidney
D. Torres, IV, (collectively “SDT”) arguing that,
because it was not notified of these potential claims and the
suits that were pending at the time of the sale, PWS is
entitled to indemnification, reasonable attorneys' fees,
and defense costs for the portion of the St. Bernard
counterclaim that arises from the actions of the SDT
Defendants prior to June 1, 2011 and seeking a declaratory
judgment that SDT owed PWS indemnification and defense costs
in relation to St. Bernard's breach of contract
counterclaim. No. 16-15830, R. Doc. 1 at 10,
Meanwhile, PWS retained counsel to defend against the St.
Bernard counterclaim and advised SDT that it would seek
reimbursement of attorneys' fees and costs for the
defense pursuant to their defense obligations under the terms
of the Purchase Agreement. R. Doc. 63-4.
April 12, 2017, this Court held that, if Defendants knew
about the potential claims at the time of the agreement
“and failed to disclose them to PWS, the four-year time
limit would not apply, and PWS would be entitled to indemnity
under Section 9.1.” R. Doc. 119 at 15. On December 21,
2017, the Court denied PWS and SDT's cross-motions for
summary judgment on the issues of: (1) whether the relevant
disputes were resolved prior to the Purchase Agreement, (2)
therefore, whether there were any disputes to disclose, and
(3) if so, whether the disputes were adequately disclosed or
whether PWS knew about the disputes without needing
disclosure from Defendants, finding that there were
reasonable factual disputes as to each of these issues,
making summary judgment inappropriate. R. Doc. 37 at 8. PWS
and SDT both appealed the Court's December 21, 2017 order
to the Fifth Circuit. R. Docs. 38, 39, 42, 43, 46.
15, 2018, the Court held a successful settlement conference
between St. Bernard, PWS, and SDT. No. 16-8669, R. Doc. 171;
No. 16-15830, R. Doc. 60. R. Doc. 63-13-4. On May 17, 2018, the
Court dismissed the instant matter without prejudice and
without costs and retained jurisdiction to reopen the action
if the settlement was not consummated in sixty days. R. Docs.
60, 61. As a result of the settlement, the parties
voluntarily dismissed their appeal before the Fifth Circuit.
R. Doc. 62. On June 22, 2018, the Court dismissed with
prejudice the companion case to the instant matter,
Progressive Waste Solutions of LA, Inc. v. St. Bernard Parish
Government, as the parties, St. Bernard and PWS,
“represent[ed] to the Court that [they had] resolved
any and all claims asserted herein and/or that could have
been asserted herein.” No. 16-8669, R. Docs. 172, 174.
No. 16-8669, R. Doc. 174.
2, 2018, PWS filed the motion presently before the Court
seeking a dismissal of the instant action specifically
reserving PWS's “rights to pursue claims not
litigated herein, ” specifically a defense cost claim,
and moves the Court to “enter an order of dismissal
recognizing that fact.” R. Doc. 63-1 at 1. The SDT
Defendants filed their motion in opposition on July 17, 2018.
R. Doc. 64.