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Heitech Services, Inc. v. Front Rowe, Inc.

United States District Court, E.D. Virginia, Alexandria Division

December 19, 2014

FRONT ROWE, INC., et al., Defendants.


JAMES C. CACHERIS, District Judge.

This contract dispute is before the Court on Plaintiff HeiTech Services, Inc.'s Motion for Summary Judgment, filed pursuant to Rule 56 of the Federal Rules of Civil Procedure. [Dkt. 31.] The Court heard the motion on December 18, 2014. No appearance was made on behalf of Front Rowe, Inc. ("FRI"). The Court heard oral argument of Plaintiff's counsel, who also represented to the Court that FRI's bankruptcy counsel did not contest the amount owed, and did not contest this motion for summary judgment. Thereafter, the Court granted Plaintiff's uncontested motion for summary judgment. This Memorandum Opinion memorializes the Court's reasons for doing so.

I. Background

On June 16, 2014, Plaintiff HeiTech Services, Inc. ("Plaintiff") filed a Complaint against Defendants FRI, Atron Rowe ("Atron"), and Karen Rowe ("Karen") (collectively "Defendants") alleging Breach of Contract, as to FRI only, and Fraud, as to all Defendants. (Compl. [Dkt. 1] at 7-10.) On November 20, 2014, the parties appeared for a Final Pre-trial Conference. [Dkt. 28.] The same day, defense counsel's motion to withdraw as attorney for all Defendants was granted (Order [Dkt. 29] at 1), and the next day, Plaintiff filed the instant motion for summary judgment [Dkt. 31], with a memorandum in support (Pl.'s Mem. [Dkt. 34]). Plaintiff's counsel provided a Roseboro Notice in accordance with E.D. Va. Local Civil Rule 7(K) and certified that all necessary briefs were delivered via U.S. Mail to the now pro se individual Defendants and to FRI through its registered agent, Horace McClerklin. (Pl.'s Mot. for Summ. J. [Dkt. 31] at 2-3; Pl.'s Mem. at 31.)

On December 4, 2014, Plaintiff filed a Notice of Bankruptcy after being advised that individual Defendants Atron Rowe and Karen Rowe have filed Chapter 13 bankruptcy petitions in the United States Bankruptcy Court for the Eastern District of Virginia. [Dkt. 38.] Consequently, the Court entered an Order staying the case as to the two individual Defendants only. [Dkt. 40.] During the hearing on the summary judgment motion, Plaintiff's counsel represented through FRI's bankruptcy counsel that FRI was not filing for bankruptcy, that FRI did not oppose the motion for summary judgment, and that FRI did not oppose the judgment amount sought by Plaintiff.

II. Standard of Review

Summary judgment is appropriate only if the record shows 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." Fed.R.Civ.P. 56(c); see also Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 247-48 (1986); Evans v. Techs. Applications & Serv., Co. , 80 F.3d 954, 958-59 (4th Cir. 1996) (citations omitted). In reviewing the record on summary judgment, "the court must draw any inferences in the light most favorable to the non-movant [and] determine whether the record taken as a whole could lead a reasonable trier of fact to find for the non-movant." Brock v. Entre Computer Ctrs. , 933 F.2d 1253, 1259 (4th Cir. 1991) (citations omitted).

However, once a motion for summary judgment is properly made and supported, the opposing party has the burden of showing that a genuine dispute exists. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 586-87 (1986); see also Ray Commc'ns, Inc. v. Clear Channel Commc'ns, Inc. , 673 F.3d 294, 299 (4th Cir. 2012) (stating the opposing party must "come forward with specific facts showing that there is a genuine issue for trial.") (citations and internal quotations omitted). Generally, contract interpretation is a subject particularly suited for summary judgment disposal. Bank of Montreal v. Signet Bank , 193 F.3d 818, 835 (4th Cir. 1999) (citation omitted)).

Specifically in this Court, on summary judgment, the parties are required to list the undisputed material facts. E.D. Va. Local Civil Rule 56(B). "In determining a motion for summary judgment, the Court may assume that facts identified by the moving party in its listing of material facts are admitted, unless such a fact is controverted in the statement of genuine issues filed in opposition to the motion." Id . Similarly, "[i]f a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact as required by Rule 56(c), the court may consider the fact undisputed for purposes of the motion." Fed.R.Civ.P. 56(e)(2).

Here, because the non-moving Defendant failed to file an opposition to Plaintiff's statement of undisputed material facts, the Court may deem those undisputed facts admitted. JDS Uniphase Corp. v. Jennings , 473 F.Supp.2d 705, 707 (E.D. Va. 2007). The undisputed material facts are summarized as follows. (See Pl.'s Mem. at 2-11 (citations omitted).)

III. Undisputed Material Facts

Since 1997, Atron and Karen Rowe have owned and operated FRI, a Virginia corporation with its principal place of business in Fairfax County, Virginia. On May 1, 2012, FRI entered into a Prime Contract with the United States Department of Labor ("DOL") for document preparation work ("the Prime Contract"). Under the Prime Contract, DOL would pay FRI based on the number of pages scanned and digitized. Two months later, on July 1, 2012, FRI entered into a Subcontractor Agreement ("the Subcontract") with Plaintiff. Under the Subcontract, FRI would receive 51% of the revenue and Plaintiff would receive 49% of the revenue, based on the production output that FRI charged to DOL. While FRI received payment directly from DOL, it agreed to pay Plaintiff 49% of the revenue it received from DOL no later than five business days after payment. Under the Subcontract, Plaintiff's employees worked directly with FRI employees and were managed by FRI employees.

Starting in July of 2012 and continuing through May of 2014, Karen Rowe submitted invoices on behalf of FRI to DOL for work under the Prime Contract, based on the number of pages processed and billed during that particular month. During this period of time, in response to Plaintiff's request, Karen Rowe sent via e-mail the purported production output for the preceding month, but she did not send Plaintiff the Monthly Status Report or the invoice ultimately submitted to DOL.

During the period of time at issue, for at least 16 of the months, Karen Rowe knew the production output sent to Plaintiff was not the same production output FRI charged to DOL under the Prime Contract rates. For the months at issue, Karen and Atron Rowe intentionally concealed from Plaintiff the true production output, which FRI reported on the invoices to DOL. Consequently, ...

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