Koshani v. Barton

374 F.Supp.3d 695

Shafiqullah KOSHANI, Plaintiff,

v.Eric Wayne BARTON, and Vanquish Worldwide, L.L.C., Defendants.

No. 3:17-CV-265

United States District Court, E.D. Tennessee, Knoxville Division.

Filed March 20, 2019

Daniel Marino, Tillman James Finley, Marino Finley PLLC, Washington, DC, Kathrynn Benson, Pro Hac Vice, Marino Finley LLP, Newport Beach, CA, for Plaintiff.

C. Paul Harrison, Garrett P. Swartwood, Long, Ragsdale & Waters, PC, Knoxville, TN, Michael Maloney, Pro Hac Vice, William A. Wozniak, Pro Hac Vice, Williams Mullen, Tysons Corner, VA, Todd W. Miller, Pro Hac Vice, Miller & Miller, LLC, Golden, CO, for Defendants.

MEMORANDUM OPINION

Thomas W. Phillips, SENIOR UNITED STATES DISTRICT JUDGE

This civil action is before the court for consideration of Plaintiff/Counter-Defendant's ("Plaintiff") motion for summary judgment. [Doc. 203]. Defendants/Counter-Plaintiffs ("Defendants") have filed a response, and Plaintiff has submitted a reply. [Docs. 206, 211]. Also before the Court is Plaintiff's motion for an extension of time to file a reply, which Defendants do not oppose [doc. 208], and Defendants' motion to strike the evidence submitted with Plaintiff's reply brief [doc. 212]. For the reasons that follow, the motion for extension of time [doc. 208] is granted, to the extent that the Court has considered Plaintiff's reply brief, the motion to strike [doc. 212] is denied as moot, as the Court has not relied on the evidence submitted with Plaintiff's reply brief in formulating this opinion, and the motion for summary judgment [doc. 203] is granted in part and denied in part.

I. Background

The plaintiff, Shafiqullah Koshani, a citizen and resident of Afghanistan, filed suit against defendants Eric Barton, a citizen of the United States, and Vanquish Worldwide, LLC, alleging that he and Mr. Barton established a joint venture in Afghanistan in 2010. [Doc. 41 at 103]. Plaintiff maintains that the parties named their new business Vanquish Worldwide ("Vanquish Afghanistan") and pursued a contract with the United States Army, which was soliciting bids for a project known as "National Afghan Trucking," or "NAT," in Afghanistan. [Id. at 1, 4-5]. Plaintiff alleges that Mr. Barton submitted a proposal to the United States in response to the NAT solicitation, but instead of submitting it in Vanquish Afghanistan's name, he submitted the proposal on behalf of a company with a nearly identical name, Vanquish Worldwide, LLC ("Vanquish United States")—a company that he allegedly owned in Tennessee—and tabbed Vanquish Afghanistan as a subcontractor that would render services under the contract. [Id. at 3, 7]. The United States ultimately awarded the NAT contract to Vanquish United States. [Id. at 8]. Plaintiff ultimately alleges that he was not paid profits from the NAT contract, and filed suit to recover those lost profits. [Id. at 12].

Defendants respond with several counterclaims. [Doc. 75]. Defendants state that they submitted a proposal for the NAT contract which listed Vanquish United States as the prime contractor and Vanquish Afghanistan as the subcontractor, after their initial subcontractor, United Sadat Transportation and Logistics Company ("USC"), partially owned by Plaintiff's brother Farid Koshani, backed out. [Id. at 24-25]. After receiving the NAT contract, Vanquish United States allegedly hired Plaintiff's brother Jawid Koshani to serve as Operations Manager under the NAT contract, and Jawid signed a Confidentiality, Non-Disclosure, and Non-Competition Agreement ("NDA") with Vanquish United States. [Id. at 25]. The NDA stated that, during his employment, and for one year after, Jawid would not "[s]olict, divert, or appropriate, or attempt to solicit, divert or appropriate, directly or by assisting others, any business from any of Vanquish's customers ... for purposes of providing products or services that are competitive with those provided by Vanquish[.]" [Id. at 26].

Defendants allege that, after the award of the NAT Contract, Plaintiff refused to allow Vanquish Afghanistan to perform trucking missions, and suggested that Defendants use USC as a subcontractor instead. [Id. ]. After further discussion, Plaintiff ultimately agreed to use Vanquish Afghanistan for NAT trucking missions, and signed several agreements on the matter. [Id. at 26-27]. However, Defendants state that they later learned that Plaintiff did not truly intend for Vanquish Afghanistan to perform any trucking missions, and every mission was given to USC rather than Vanquish Afghanistan. [Id. at 27].

Defendants allege that at the end of the NAT contract base period, when the United States Army began awarding the first option year, Plaintiff began "making plans to steal the NAT Contract," and recruited his brother Jawid to assist in this scheme. [Id. ]. Defendants state that Plaintiff created a new Afghan sole proprietorship under a name similar to Vanquish Worldwide that was 100% owned by Plaintiff, registered it with Afghan authorities, and set up a new Afghan bank account for the sole proprietorship. [Id. at 28]. Defendants allege that Plaintiff and Jawid made false statements to the U.S. Government in an effort to convince officials to issue the NAT contract option year to the sole proprietorship rather than Vanquish United States. [Id. ]. Defendants state that Plaintiff lied to government officials about his entitlement to the NAT contract option year, as well as stating that Mr. Barton had forged signatures on contracts and lied to contracting officials. [Id. at 29-30]. Defendants allege that Plaintiff's efforts were successful when the government suspended payments to Vanquish United States under the NAT contract, and also suspended Vanquish United States from receiving any missions under the NAT contract, beginning in October 2012. [Id. at 30].

In their counterclaims, Defendants allege claims for breach of contract, breach of the covenant of good faith and fair dealing, breach of the duty not to misuse partnership assets, tortious interference with contract, statutory inducement of a breach of contract, and conspiracy. [Id. at 31-39]. Plaintiff now seeks summary judgment on these counterclaims.

II. Standard of Review

Summary judgment is appropriate when the moving party shows that the record—the admissions, affidavits, answers to interrogatories, declarations, depositions, or other materials—is without a genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a), (c) ; Celotex Corp. v. Catrett , 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The moving party has the initial burden of identifying the basis for summary judgment and the portions of the record that lack genuine issues of material fact. Celotex , 477 U.S. at 323, 106 S.Ct. 2548. The moving party discharges that burden by showing "an absence of evidence to support the nonmoving party's case," at which point the non-moving party, to withstand summary judgment, must identify facts in the record that create a genuine issue of material fact. Id. at 324-25, 106 S.Ct. 2548.

Not just any factual dispute will defeat a motion for summary judgment—the requirement is "that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (emphasis in original). A fact is "material" if it may affect the outcome of the case under the applicable substantive law, and an issue is "genuine" if the evidence is "such that a reasonable jury could return a verdict for the nonmoving party." Id. at 248, 106 S.Ct. 2505. In short, the inquiry is whether the record contains evidence that "presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Id. at 251-52, 106 S.Ct. 2505. When ruling on a motion for summary judgment, a court must view the facts and draw all reasonable inferences in the light most favorable to the non-moving party. Scott v. Harris , 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007). "[T]he judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Anderson , 477 U.S. at 249, 106 S.Ct. 2505.

III. Analysis

A. Statute of Limitations

The parties have raised various arguments relating to whether Counterclaims 1, 4, 5, 6, and 7 are barred by applicable statutes of limitations, and whether various tolling doctrines apply. This Court will first address whether these counterclaims were filed outside the limitations period, and then address whether any tolling doctrines are applicable.

1. Discovery Rule

In his motion for summary judgment, Plaintiff contends that Counterclaims 1 and 4-7 are barred by the applicable statutes of limitations. [Doc. 204 at 1-3]. Plaintiff states that e-mails from September, October, and November of 2012 indicate that Defendants were aware that Plaintiff was communicating with the contracting officer and claiming an ownership in Vanquish United States or the NAT contract, and thus, the counterclaims are untimely. [Id. at 3]. Defendants assert that the e-mails on which Plaintiff relies do not show that Defendants were aware of their injury and that the Plaintiff was the person who caused the injury, and they did not learn such information until 2015, when documentation was produced as part of an Armed Services Board of Contract Appeals ("ASBCA") appeal, related to Vanquish United States's suspension under the NAT contract. [Doc. 206 at 4-8]. Plaintiff replies that Defendants do not deny that they were on inquiry notice as to Count 1 in 2011. [Doc. 211 at 3-6].

Tennessee generally applies a six-year statute of limitations to contract actions. Tenn. Code. Ann. § 28-3-109(a)(3) ; Benz-Elliott v. Barrett Enterprises, LP , 456 S.W.3d 140, 152 (Tenn. 2015). Tennessee also applies a three-year statute of limitations to tort actions involving...