THIS MATTER IS BEFORE THE COURT ON PLAINTIFFS' MOTION FOR RECONSIDERATION OF THIS COURT'S GRANT OF PARTIAL SUMMARY JUDGMENT, FILED 11/17/2022. DEFENDANTS D.J. KEEHAN, WESTLAKE SHADOW CREEK, LLC, SIGNATURE BUILDING CONCEPTS, LLC, AND ONLINE COMMUNICATIONS, LLC'S (COLLECTIVELY, "DEFENDANTS") FILED A BRIEF IN OPPOSITION ON 11/23/2022 AND PLAINTIFFS FILED A REPLY ON 11/29/2022. A HEARING ON THE MOTION FOR RECONSIDERATION WAS HELD ON 12/12/2022. PLAINTIFF ROBERT TRACI APPEARED PRO SE. ALL OTHER PARTIES APPEARED THROUGH COUNSEL. ALL PARTIES ELECTED TO MAKE ORAL ARGUMENTS, RATHER THAN CALLING WITNESSES OR INTRODUCING EXHIBITS OTHER THAN THOSE ATTACHED TO THEIR PREVIOUS BRIEFINGS ON SUMMARY JUDGMENT AND RECONSIDERATION. FOLLOWING ORAL ARGUMENTS BY THE PARTIES, THE MATTER WAS DEEMED HEARD AND SUBMITTED BY THE COURT. UPON CONSIDERATION OF THE BRIEFINGS, THE EVIDENCE PRESENTED, AND ARGUMENTS PRESENTED AT THE HEARING, PLAINTIFFS' MOTION FOR RECONSIDERATION IS DENIED. DEFENDANTS FILED THEIR MOTION FOR SUMMARY JUDGMENT ON 05/09/2022 SEEKING SUMMARY JUDGMENT ON ALL COUNTS IN PLAINTIFFS' SECOND AMENDED COMPLAINT AND ON WESTLAKE SHADOW CREEK, LLC'S COUNTERCLAIM. PLAINTIFFS FILED A MOTION FOR LEAVE TO FILE ADDITIONAL DISCOVERY ON 05/22/2022. IN RESPONSE, DEFENDANTS FILED A MOTION FOR PROTECTIVE ORDER ON 05/24/2022. PLAINTIFFS ALSO FILED A MOTION TO COMPEL DISCOVERY ON 06/05/2022, WHICH DEFENDANTS OPPOSED. ON 07/01/2022 THE COURT DENIED PLAINTIFFS' MOTIONS TO COMPEL AND FOR LEAVE TO FILE ADDITIONAL DISCOVERY, BUT GRANTED PLAINTIFFS TWENTY-EIGHT DAYS TO FILE A BRIEF IN OPPOSITION TO THE SUMMARY JUDGMENT MOTION. ON 07/05/2022 PLAINTIFFS FILED A MOTION FOR RECONSIDERATION OF THE COURT'S 07/01/2022 ORDERS, WHICH DEFENDANTS OPPOSED. FOLLOWING A HEARING ON THE MOTION FOR RECONSIDERATION, THE COURT GRANTED PLAINTIFF'S MOTION FOR RECONSIDERATION IN PART, ON 09/21/2022, AND ORDERED DEFENDANTS TO PRODUCE CERTAIN ADDITIONAL DISCOVERY WITHIN FOURTEEN DAYS. NO OTHER MOTIONS WERE FILED RELATED TO THE COURT'S RULING ON THE MOTION FOR RECONSIDERATION. PLAINTIFFS FILED A BRIEF IN OPPOSITION TO DEFENDANTS' MOTION FOR SUMMARY JUDGMENT ON 07/26/2022. DEFENDANTS FILED A REPLY BRIEF ON 08/02/2022. ON 11/04/2022 THE COURT ISSUED AN EXTENSIVE ELEVEN-PAGE OPINION SETTING FORTH AND APPLYING THE APPROPRIATE SUMMARY JUDGMENT STANDARD. IN THE ORDER, THE COURT GRANTED SUMMARY JUDGMENT IN FAVOR OF DEFENDANTS ON PLAINTIFFS' CLAIMS FOR FRAUD AND ALTER EGO LIABILITY BUT DENIED THE MOTION FOR SUMMARY JUDGMENT ON ALL OTHER CLAIMS. PLAINTIFFS ARGUE THAT THE COURT IMPROPERLY WEIGHED THE EVIDENCE BEFORE IT, RATHER THAN TAKING PLAINTIFF'S ASSERTIONS AS TRUE. THE COURT FINDS THIS ARGUMENT TO BE WITHOUT MERIT. "SUMMARY JUDGMENT IS APPROPRIATE WHEN, CONSTRUING THE EVIDENCE MOST STRONGLY IN FAVOR OF THE NONMOVING PARTY, (1) THERE IS NO GENUINE ISSUE OF MATERIAL FACT; (2) THE MOVING PARTY IS ENTITLED TO JUDGMENT AS A MATTER OF LAW; AND (3) REASONABLE MINDS CAN ONLY REACH A CONCLUSION THAT IS ADVERSE TO THE NONMOVING PARTY. THE PARTY MOVING FOR SUMMARY JUDGMENT BEARS THE BURDEN OF DEMONSTRATING THAT NO MATERIAL ISSUES OF FACT EXIST FOR TRIAL. THE MOVING PARTY BEARS THE INITIAL RESPONSIBILITY OF INFORMING THE TRIAL COURT OF THE BASIS FOR THE MOTION, AND IDENTIFYING THOSE PORTIONS OF THE RECORD THAT DEMONSTRATE THE ABSENCE OF A GENUINE ISSUE OF MATERIAL FACT ON THE ESSENTIAL ELEMENTS OF THE NONMOVING PARTY'S CLAIMS. AFTER THE MOVING PARTY HAS SATISFIED THIS INITIAL BURDEN, THE NONMOVING PARTY HAS A RECIPROCAL DUTY TO SET FORTH SPECIFIC FACTS BY THE MEANS LISTED IN CIV.R. 56(C) SHOWING THAT THERE IS A GENUINE ISSUE OF MATERIAL FACT. IF THE PARTY DOES NOT RESPOND, SUMMARY JUDGMENT, IF APPROPRIATE, SHALL BE ENTERED AGAINST THE PARTY." TELECOM ACQUISITION CORP. I V. LUCIC ENTERS., 2016-OHIO-1466, P86-P87, 62 N.E.3D 1034, 1052-1053, 2016 OHIO APP. LEXIS 1361, *35-36, 2016 WL 1378708 (INTERNAL CITATIONS OMITTED). "ONCE THE MOVING PARTY SATISFIES ITS BURDEN, THE NONMOVING PARTY 'MAY NOT REST UPON THE MERE ALLEGATIONS OR DENIALS OF THE PARTY'S PLEADINGS, BUT THE PARTY'S RESPONSE, BY AFFIDAVIT OR AS OTHERWISE PROVIDED IN THIS RULE, MUST SET FORTH SPECIFIC FACTS SHOWING THAT THERE IS A GENUINE ISSUE FOR TRIAL.' CIV. R. 56(E); MOOTISPAW V. ECKSTEIN, 76 OHIO ST.3D 383, 385, 667 N.E.2D 1197 (1996) "IN SUMMARY JUDGMENT PROCEEDINGS, A COURT MAY NOT WEIGH THE EVIDENCE OR JUDGE THE CREDIBILITY OF SWORN STATEMENTS, PROPERLY FILED IN SUPPORT OF OR IN OPPOSITION TO A SUMMARY JUDGMENT MOTION, AND MUST CONSTRUE THE EVIDENCE IN FAVOR OF THE NONMOVING PARTY. '[W]HEN REVIEWING A MOTION FOR SUMMARY JUDGMENT, A COURT MUST BE CAREFUL NOT TO WEIGH THE EVIDENCE OR JUDGE THE CREDIBILITY OF WITNESSES. * * * INSTEAD, IT MUST CONSIDER ALL OF THE EVIDENCE AND REASONABLE INFERENCES THAT CAN BE DRAWN FROM THE EVIDENTIARY MATERIALS IN FAVOR OF THE NONMOVING PARTY.' WHEN TRIAL COURTS CHOOSE BETWEEN COMPETING AFFIDAVITS AND TESTIMONY, THEY IMPROPERLY DETERMINE CREDIBILITY AND WEIGH EVIDENCE CONTRARY TO SUMMARY JUDGMENT STANDARDS." TELECOM AT *93 (INTERNAL CITATIONS OMITTED). THE COURT'S ORDER PROPERLY APPLIES THE ABOVE SUMMARY JUDGMENT STANDARD, AS SET FORTH BELOW. THE COURT FOUND THAT GENUINE ISSUE OF MATERIAL FACT REMAINED REGARDING WHETHER PLAINTIFFS CAN PROVE THEIR CLAIMS FOR BREACH OF CONTRACT, AND BREACH OF WARRANTIES. THE COURT FURTHER FOUND THAT BECAUSE THE PARTIES PUT FORWARD COMPETING EVIDENCE REGARDING WHETHER PLAINTIFF TRACI IS A THIRD-PARTY BENEFICIARY TO THE CONTRACT, AND WHETHER DEFENDANTS ARE ENTITLED TO JUDGMENT ON THEIR COUNTERCLAIM, SUMMARY JUDGMENT WAS NOT APPROPRIATE ON THOSE ISSUES. PLAINTIFF'S CLAIM FOR BREACH OF CONTRACT AND BRIEF OF WARRANTIES, AND DEFENDANTS' COUNTERCLAIM REMAINS PENDING. REGARDING PLAINTIFF'S CLAIMS FOR FRAUD AND ALTER EGO LIABILITY, THE COURT FOUND THAT DEFENDANTS MET THEIR BURDEN OF INFORMING THE COURT OF THE BASIS FOR THE MOTION, AND IDENTIFYING THOSE PORTIONS OF THE RECORD THAT DEMONSTRATE THE ABSENCE OF A GENUINE ISSUE OF MATERIAL FACT. UPON THIS AFFIRMATIVE SHOWING, THE BURDEN SHIFTED TO PLAINTIFFS TO PROVIDE EVIDENCE IN THE FORM OF PLEADINGS, DEPOSITIONS, ANSWERS TO INTERROGATORIES, WRITTEN ADMISSIONS, AFFIDAVITS, TRANSCRIPTS OF EVIDENCE, AND WRITTEN STIPULATIONS OF FACT TO SHOW THAT A GENUINE ISSUE OF MATERIAL FACT REMAINED FOR TRIAL ON THOSE CLAIMS, PURSUANT TO CIV.R. 56(C). THE COURT CONSIDERED ALL EVIDENCE SUBMITTED PURSUANT TO THE ABOVE STANDARD, INCLUDING ALL FILED DEPOSITIONS AND AFFIDAVITS WITH EXHIBITS ATTACHED, PLEADINGS, PHOTOS, AND DISCOVERY, AND CONSTRUED ALL EVIDENCE AND ANY INFERENCE IN FAVOR OF THE NON-MOVING PARTY, AS REQUIRED UNDER CIV.R. 56(C). THE COURT PROPERLY FOUND THAT PLAINTIFFS FAILED TO MEET THEIR BURDEN ON SUMMARY JUDGMENT. SPECIFICALLY, THE COURT FOUND THAT PLAINTIFFS' BRIEF WAS DEVOID OF ANY ARGUMENT, LET ALONE EVIDENCE, TO SHOW THAT A GENUINE ISSUE OF MATERIAL FACT EXISTED TO SUPPORT PLAINTIFFS' CLAIM FOR ALTER EGO LIABILITY. SIMILARLY, PLAINTIFF FOCUSED ON ONE SPECIFIC INSTANCE OF ALLEGED FRAUD: THE ASSERTION THAT D.J. KEEHAN SIGNED AN AFFIDAVIT, FALSELY ATTESTING THAT "NO GOVERNMENTAL AUTHORITY HAS NOTIFIED ME/US OF ANY VIOLATIONS, ABATEMENT NOTICES, OR CONDEMNATIONS." THE COURT FOUND THAT NO GENUINE ISSUE OF MATERIAL FACT REMAINED WITH REGARD TO THE FRAUD CLAIM BECAUSE D.J. KEEHAN SIGNED HIS AFFIDAVIT ATTESTING THAT THERE WERE NO KNOWN VIOLATIONS ON 10-7-2020 AND THE AFFIDAVIT OF DONALD GRAYEM AFFIRMATIVELY SHOWED THAT THE CITY INSPECTED THE PATIO ON 10-22-2020 AND INFORMED D.J. KEEHAN AND MESSER OF THE VIOLATIONS ON 10-23-2020, AFTER KEEHAN SIGNED THE AFFIDAVIT. ACCORDINGLY, THERE WAS NO EVIDENCE BEFORE THE COURT THAT THE STATEMENT WAS FRAUDULENT WHEN IT WAS MADE. STATED DIFFERENTLY, THE COURT DID NOT NEED TO WEIGH THE EVIDENCE TO GRANT SUMMARY JUDGMENT ON THE ALTER EGO AND FRAUD CLAIMS BECAUSE THE ONLY EVIDENCE PUT FORTH BY EITHER PARTY SUPPORTED THE ASSERTION THAT DEFENDANTS WERE ENTITLED TO SUMMARY JUDGMENT ON THE CLAIMS FOR FRAUD AND ALTER EGO LIABILITY. PLAINTIFF ARGUES THAT BECAUSE THE COURT PREVIOUSLY DENIED THE DEFENDANTS' MOTION TO DISMISS THE FRAUD CLAIMS, THE COURT ERRED BY GRANTING SUMMARY JUDGMENT ON THE FRAUD CLAIM. HOWEVER, AN ANALYSIS OF THOSE MOTIONS REQUIRES THE APPLICATION OF TWO DIFFERENT STANDARDS. WHILE THE COURT IS REQUIRED TO TAKE THE FACTS IN THE COMPLAINT AS TRUE WHEN DECIDING A MOTION TO DISMISS, THE NONMOVING PARTY BEARS THE BURDEN OF SUBSTANTIATING THEIR CLAIMS WITH SPECIFIC EVIDENCE, ONCE THE BURDEN SHIFTS TO THEM ON SUMMARY JUDGMENT. PLAINTIFFS HAVE FAILED TO PRESENT ANY ADDITIONAL EVIDENCE THAT COMPLIES WITH THE CIV.R. 56(C) STANDARD AND WOULD SUPPORT THEIR MOTION FOR RECONSIDERATION. PLAINTIFFS FURTHER ARGUE THAT, EVEN IF KEEHAN'S STATEMENT WAS NOT FRAUDULENT AT THE TIME HE SIGNED THE AFFIDAVIT, IT BECAME FRAUDULENT WHEN HE PRESENTED THE AFFIDAVIT TO THE PLAINTIFFS AT CLOSING. EVEN ASSUMING THAT DEFENDANTS COULD BE LIABLE FOR FRAUD WHEN A STATEMENT IN THE AFFIDAVIT BECAME TRUE AFTER IT WAS MADE BECAUSE PLAINTIFFS READ AND RELIED ON IT AT A LATER DATE, PLAINTIFFS WOULD BE UNABLE TO RECOVER FOR FRAUD AS A MATTER OF LAW. AS ARGUED BY DEFENDANTS IN THEIR INITIAL MOTION FOR SUMMARY JUDGMENT, AT THE HEARING ON THE MOTION FOR RECONSIDERATION, AND IN THEIR BRIEF IN OPPOSITION TO THE MOTION FOR RECONSIDERATION, THE EIGHTH DISTRICT HAS HELD " . . . A TORT CLAIM BASED UPON THE SAME ACTIONS AS THE ACTIONS UPON WHICH A BREACH OF CONTRACT ACTION ARE BASED WILL ONLY EXIST IF IN ADDITION TO CONTAINING A DUTY INDEPENDENT OF THAT CREATED BY CONTRACT, THE PLAINTIFF "MUST INCLUDE ACTUAL DAMAGES ATTRIBUTABLE TO THE WRONGFUL ACTS OF THE ALLEGED TORTFEASOR WHICH ARE IN ADDITION TO THOSE ATTRIBUTABLE TO THE BREACH OF THE CONTRACT." EVERSTAFF, LLC V. SANSAI ENVTL. TECHS., LLC, 2011-OHIO-4824, P28, 2011 OHIO APP. LEXIS 3988, *17, 2011 WL 4390083. IN OTHER WORDS "A TORT CLAIM BASED UPON THE SAME ACTIONS AS A BREACH OF CONTRACT FAILS AS A MATTER OF LAW WHERE NO DUTY IS OWED IN THE ABSENCE OF THE OBLIGATIONS UNDER THE CONTRACT, I.E. THE DUTY IS OWED EVEN IF NO CONTRACT EXISTED." PIERRE INVS., INC. V. CLS CAPITAL GRP., INC., 2022-OHIO-4311, P37, 2022 OHIO APP. LEXIS 4054, *25, 2022 WL 17369093. WHEN CAUSES OF ACTION FOR FRAUDULENT INDUCEMENT AND BREACH OF CONTRACT ARE FACTUALLY INTERTWINED, THE FRAUD CLAIM WILL FAIL AS A MATTER OF LAW UNLESS THE PLAINTIFF CAN SHOW THAT "THE TORT CLAIM EXISTS NOTWITHSTANDING THE CONTRACT AND THAT THERE ARE ADDITIONAL, ACTUAL DAMAGES ATTRIBUTABLE TO THE FRAUDULENT INDUCEMENT CLAIM SEPARATE FROM THOSE ATTRIBUTED TO THE BREACH OF CONTRACT CLAIM." ID. BASED ON THE FOREGOING STANDARD, PLAINTIFFS' FRAUD CLAIM IS BARRED BECAUSE THEY HAVE FAILED TO POINT TO ANY DUTY OR DAMAGES INDEPENDENT FROM THOSE STEMMING FROM THE CONTRACT. PARAGRAPH THIRTY-FOUR OF PLAINTIFFS' AMENDED COMPLAINT ALLEGES THAT THEY WERE DAMAGED BY DEFENDANTS' FRAUD BECAUSE, ABSENT THE FRAUDULENT REPRESENTATIONS, THEY WOULD NOT HAVE CLOSED ON THE SALE OF THE PROPERTY. PARAGRAPH FOUR OF ROBERT TRACI'S AFFIDAVIT REITERATES THAT PLAINTIFFS' DAMAGES ARE TIED TO THE CONTRACT: "IF ASSUNTA ROSSI AND I HAD KNOWN OF THE VIOLATION OF THE CITY CODE WE WOULD NOT HAVE AGREED TO CLOSE THE SALE UNLESS AND UNTIL IT WAS REPAIRED TO COMPLY WITH THE CITY CODE. NEITHER MS. ROSSI NOR I WERE EVEN AWARE OF THIS ISSUE UNTIL LATE FEBRUARY, 2021, MONTHS AFTER CLOSING." ROSSI CONCURRS IN PARAGRPH THIRTY-TWO OF HER AFFIDAVIT, "IF I HAD KNOWN OF THE VIOLATION OF THE CITY CODE I WOULD NOT HAVE AGREED TO CLOSE THE SALE UNLESS AND UNTIL IT WAS REPAIRED TO COMPLY WITH THE CITY CODE. NEITHER ROBERT TRACI NOR I WERE EVEN AWARE OF THIS ISSUE UNTIL LATE FEBRUARY, 2021, MONTHS AFTER CLOSING." ALTHOUGH DEFENDANTS REPEATEDLY ARGUED THAT PLAINTIFFS FAILED TO ARTICULATE A DUTY OR DAMAGE SEPERATE FROM THE CONTRACT, PLAINTIFF DO NOT POINT TO A SEPERATE DUTY OF DAMAGES IN PAGES 3-6 OF THE MOTION FOR RECONSIDERATION, WHICH ADDRESS THE FRAUD CLAIM, INSTEAD REITERATED THAT PLAINTIFFS WOULD NOT HAVE CLOSED ON THE CONTRACT, ABSENT THE ALLEGED FRAUD. ACCORDINGLY, PLAINTIFF'S CLAIMS FOR BREACH OF CONTRACT AND FRAUD ARE CLEARLY FACTUALLY INTERTWINED. TAKING ALL INFERENCES IN FAVOR OF THE NON-MOVING PARTY, PLAINTIFFS ARE NOT ALLEGING DAMAGES OR A DUTY SEPARATE AND APART FROM THE CONTRACT AT ISSUE, AND SUMMARY JUDGMENT IS PROPER ON THE CLAIM FOR FRAUD. AS NOTED ABOVE, PLAINTIFFS HAVE OFFERED NO NEW TESTIMONY OR EXHIBITS TO SUPPORT THEIR CLAIM FOR ALTER EGO LIABILITY. "THE CORPORATE FORM MAY BE DISREGARDED AND INDIVIDUAL SHAREHOLDERS HELD LIABLE FOR WRONGS COMMITTED BY THE CORPORATION WHEN (1) CONTROL OVER THE CORPORATION BY THOSE TO BE HELD LIABLE WAS SO COMPLETE THAT THE CORPORATION HAS NO SEPARATE MIND, WILL, OR EXISTENCE OF ITS OWN, (2) CONTROL OVER THE CORPORATION BY THOSE TO BE HELD LIABLE WAS EXERCISED IN SUCH A MANNER AS TO COMMIT FRAUD OR AN ILLEGAL ACT AGAINST THE PERSON SEEKING TO DISREGARD THE CORPORATE ENTITY, AND (3) INJURY OR UNJUST LOSS RESULTED TO THE PLAINTIFF FROM SUCH CONTROL AND WRONG." DOMBROSKI V. WELLPOINT, INC., 119 OHIO ST. 3D 506, 510-511, 2008-OHIO-4827, P18, 895 N.E.2D 538, 543, 2008 OHIO LEXIS 2582, *10-11. PIERCING THE CORPORATE VEIL IS A RARE EXCEPTION, WHICH SHOULD ONLY BE APPLIED IN THE CASE OF "FRAUD OR OTHER EXCEPTIONAL CIRCUMSTANCES." ID. AT * 15. WHILE PLAINTIFF DID PRESENT ORAL ARGUMENTS ON THE ISSUE OF PIERCING THE CORPORATE VEIL AT THE HEARING, ONLY EVIDENCE THAT MEETS THE CIV.R. 56(C) STANDARD CAN CREATE A GENUINE ISSUE OF MATERIAL FACT. PLAINTIFF'S MOTION CONTAINS SEVERAL GENERAL CITATIONS DIRECTING THE COURT TO REVIEW THE ENTIRETY OF THE SEVERAL DEPOSITION TRANSCRIPTS PREVIOUSLY FILED, BUT ONLY POINTS TO ONE SPECIFIC PORTION OF DEPOSITION TESTIMONY ON THE ISSUE OF ALTER EGO LIABILITY ("PAGES 15-17 OF CORP. DEPO FILED WITH THE COURT"). ULTIMATELY, THE COURT NEED NOT ANALYZE WHETHER PLAINTIFFS COULD MEET THE FIRST ELEMENT OF ITS ALTER EGO CLAIM BECAUSE, AS SET FORTH ABOVE, THERE IS NO EVIDENCE OF ANY FRAUD OR A SIMILAR EXTREME MISCONDUCT WHICH WOULD JUSTIFY PIERCING THE CORPORATE VEIL. FOR THE FOREGOING REASONS, PLAINTIFFS' MOTION FOR RECONSIDERATION, FILED 11/17/2022 IS DENIED. THERE IS NO JUST CAUSE FOR DELAY. NOTICE ISSUED
