Preview
FILED
12/28/2023 4:52 PM
FELICIA PITRE
DISTRICT CLERK
DALLAS CO., TEXAS
Kellie Juricek DEPUTY
CAUSE NO. DC-21-00298
LEEDS REAL ESTATE SERVICES, INC. and, § IN THE DISTRICT COURT
JASON LEEDS, INDIVIUDALLY §
Plaintiffs, §
§
v. §
§
STILLWATER CAPITAL INVESTMENTS, §
LLC; ROBERT AARON SHERMAN, §
Individually; RICHARD J. COADY, IV, §
Individually, and ROBERT C. ELLIOTT, § 162nd JUDICIAL DISTRICT
Individually; SW PARTNER HOLDINGS, II, §
LLC; STILLWATER RESIDENTIAL §
INVESTMENTS II, LLC; S.W. COMPANY §
MANAGER II, LLC; SWSB PHASE I, LLC; §
SWSB PHASE II, LLC; STILLWATER AP-1 §
DEVELOPMENT, LLC; and STILLWATER §
AP-2 DEVELOPMENT, LLC, §
§
Defendants. § DALLAS COUNTY, TEXAS
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON
DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 1
I.
INTRODUCTION AND SUMMARY
Plaintiffs Leeds Real Estate Services, Inc. and Jason Leeds (“Leeds,” collectively, or
“Plaintiffs”) respectfully file this Traditional Motion for Partial Summary Judgment to dismiss
all of the counterclaims and affirmative defenses brought by Defendants Robert Aaron Sherman,
Robert C. Elliott, Richard J. Coady, IV, Stillwater Capital Investments, LLC (“Stillwater”),
Stillwater AP-1 Development, LLC (“SW AP-1”), and S.W. Company Manager II, LLC
(“SWCM”) (collectively, “Defendants,” and with Plaintiffs, the “Parties”).
The bases for this motion are straightforward. Generally, Defendants’ counterclaims and
affirmative defenses all arise out of the allegation that, under the Parties’ August 26, 2015,
settlement agreement (the “Settlement Agreement”), Leeds was supposed to have informed
Defendants of the amount of profits Leeds’s earned (called a “Promote” in real estate speak)
from the sale of a multifamily development project called Forest Park Flats (“FPF Promote”)—
importantly, this is a different project than the “Amesbury Project” that forms the basis of
Plaintiffs’ claims. Leeds was supposed to tell Defendants this amount because, under the
Settlement Agreement, Defendants are entitled to use 50% of Leeds’s FPF Promote amount as an
offset against the amount they owe him from the sale of another project (the one at issue in this
lawsuit) called the “Amesbury Project.”
Leeds informed Defendants what his Promote was from the Forest Park Flats Project, in
writing, on August 24, 2017, but he inadvertently sent the wrong number—specifically, Leeds’s
math was wrong because he forgot to deduct the portion of proceeds he earned from his “co-
invest,” which amount is explicitly excluded from the definition of “Promote” in the Settlement
Agreement—in other words, Leeds accidentally told Defendants an FPF Promote amount that
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 2
was too high, which actually hurt Leeds, not Defendants. Leeds corrected his mistake as soon as
he realized it, which happened to be when he was searching for documents responsive to
Defendants’ requests for production during discovery, and he produced a responsive document
showing the correct amount. Leeds then explained the mistake and the proper calculation during
his own deposition, in his Amended Initial Disclosure, and through the designation and
deposition testimony of Plaintiffs’ expert, David Fuller.
The counterclaims and affirmative defenses should be dismissed for five simple reasons:
First, all of Defendants’ counterclaims, and all affirmative defenses arising from or
relying on Defendants’ counterclaims, are time barred.1
Second, Defendants’ Declaratory Judgment claim (Count A) is a mirror image of
Plaintiffs’ Declaratory Judgment cause of action, concedes that Plaintiffs’ declaratory judgment
claim is correct and just and that there is no issue of fact, and essentially asks the Court to issue a
declaration that Plaintiffs’ declaratory judgment is true and correct. Despite filing this,
Defendants refuse to jointly submit an agreed partial judgment for the Court’s signature on this
issue. Therefore, the Court should grant Plaintiffs’ summary judgment on its declaratory
judgment claim that has been pending since this case’s inception, and grant summary judgment
against Defendants’ declaratory judgment claim which, as explained below, is nothing more than
a bad faith, smoke-and-mirrors attempt by Defendants to recover attorneys’ fees.
Third, all the Defendants were deposed, and none of them could articulate a single theory
of causation or any colorable damages in support of any of their claims. Both of these are
requisite elements of all the counterclaims other than Count A—request for declaratory
judgment. In fact, the Defendants’ testimony conclusively established that Plaintiffs’ alleged
1
The following affirmative defenses arise from or rely on the counterclaims, paras 16, 17, 18, 20, 21, 22, 24,
25, 26, 27, 33, and 38 in Exhibit I, Defendants’ First Amended Affirmative and Other Defenses.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 3
conduct cause no damages, and that Defendants actually suffered no damages at all, regardless of
the alleged cause. When asked, Robert Aaron Sherman testified, on behalf of himself and all
other Defendants, that he could not identify any colorable damages. He admitted that when he
received the initial FPF Promote amount from Leeds, he made no decision based upon the
amount; he also admitted that after receiving the correct FPF amount this year during discovery,
he did not have to reverse a single decision he had made previously based upon the initially
disclosed amount, and he admitted that neither he nor his businesses lost a single contract,
customer, deal, opportunity, partner, lender, or investor—not a penny was lost because the FPF
Promote amount they were told changed or because the correct number was learned later than
anticipated. The only thing Defendants noted is that the correct FPF Promote amount was lower
than the initially reported amount—but that is not “damage,” it is simply a correction; Plaintiffs’
mistake in reporting the correct amount did not “cause” the Promote amount or offset to actually
change or become lower. The other Defendants, Coady and Elliott, also testified they could not
articulate any causation or damages and punted the issue to “other people.” Finally, Defendants’
damages expert, Andrew Walther, testified he has no opinion about any alleged counterclaim
damages and will not offer any such opinions at trial.
Fourth, Defendants further admit that they have no knowledge of, and cannot offer any
testimony or evidence in support of, the falsity, intent, or reliance elements of their Fraud and
Negligent Misrepresentation claims (Counts C and D).
Fifth, Defendants further admit away each of their equitable claims because, to date, they
have not paid any money to Plaintiffs, and, more specifically, they did not pay a penny to the
Plaintiffs based upon the alleged FPF Promote amount mistake. Therefore, the Unjust
Enrichment, Quantum Meruit, and Money Had and Received claims (Counts E, F, and G) are
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 4
baseless. What is more, the existence of the Settlement Agreement (which is a valid, enforceable
contract) precludes these equitable claims as a matter of law.
Defendants’ affirmative defenses similarly lack any evidentiary support, and each of the
Defendants and their expert witness universally testified they can provide no evidence or
testimony in support of them. This testimony conclusively negates the affirmative defenses as a
matter of law, and they should similarly be denied.
II.
SUMMARY JUDGMENT EVIDENCE
Exhibit A: Excerpts of Deposition of Richard Coady (“Coady Tr.”)
Exhibit B: Excerpts of Deposition of Robert Elliott (“Elliott Tr.”)
Exhibit C: Excerpts of Deposition of Robert Aaron Sherman (“Sherman Tr.”)
Exhibit D: Excerpts of Deposition of Robert Aaron Sherman, Corporate
Representative of Stillwater Capital Investments, LLC (“SWC Tr.”)
Exhibit E: Excerpts of Deposition of Robert Aaron Sherman, Corporate
Representative of Stillwater AP-1, LLC (“SW AP-1 Tr.”)
Exhibit F: Excerpts of Deposition of Robert Aaron Sherman, Corporate
Representative of SW Company Manager II, LLC (“SWCM Tr.”)
Exhibit G: Excerpts of Deposition of Defendants’ Expert Witness Alexander
Walther (“Walther Tr.”)
Exhibit H: Defendants’ First Amended Answer and Counterclaims
Exhibit I: Defendants’ First Amended Affirmative and Other Defenses
Exhibit J: Defendants’ Amended Initial Disclosures
Exhibit K: Excerpts of Deposition of Plaintiff Jason Leeds (“Leeds Tr.”)
Exhibit L: Settlement Agreement
Exhibit M: Plaintiff’s Original Petition
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 5
Exhibit N: SW Company Manager II, LLC; Stillwater AP-1, LLC; and Robert
Elliot, Individually, Answer
Exhibit O: Richard Coady Answer
Exhibit P: Robert Aaron Sherman and Stillwater Capital Investment, LLC’s
Answer
Exhibit Q: Forest Park Flats Promote Information (PLTF LEEDS 000794-95)
Exhibit R: Leeds’s Letter Providing Initial FPF Promote Amount (PLTF LEEDS
000951)
Exhibit S: November 2, 2023, email chain regarding Agreed Partial Judgment
Exhibit T: Proposed Agreed Partial Judgment
Exhibit U: Order Granting Plaintiffs’ Motion to Enforce Order dated May 26,
2023
Exhibit V: Order Granting Plaintiffs’ Amended Motion to Compel dated June 8,
2023
Exhibit W: Order Granting Plaintiffs’ Amended Motion to Compel dated July 5,
2023
Exhibit X: Order Granting Plaintiffs’ Amended Motion to Compel Depositions
dated June 8, 2023
Exhibit Y: Second Amended Scheduling Order
Exhibit Z: Plaintiffs’ Third Amended Petition
III.
STATEMENT OF FACTS
1. Plaintiffs filed suit claiming that Defendants breached their settlement agreement
with Plaintiffs by failing to pay Plaintiffs the profits interest, or “Promote,” that Plaintiffs were
owed. The Promote arose from the profits generated by the sale of two apartment complexes that
Plaintiffs and Defendants had developed and constructed together (the “Amesbury Project”).
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 6
“Promote” is a defined term in the August 26, 2015, settlement agreement between Plaintiffs and
Defendants (the “Settlement Agreement”)2. It is defined as:
For purposes of this Agreement, “Promote” shall refer to the back-end
profit payable to a Party hereto (or its designated subsidiary or affiliate) as
a matter of contract that exists on the Date of execution of this Agreement,
that is or will be earned from the involvement in one of the developments
that is the subject of this agreement, as a Sponsor, General Partner, or the
equivalent, and can be considered earned from “sweat equity”. “Promote”
shall not include that back-end profit that is related to direct equity
investment (aka: Co invest) in such developments by the respective
parties.
(the “Amesbury Promote”).3
2. The Settlement Agreement further provided that, as part of calculating Leeds’s
Amesbury Promote, the Defendants were entitled to subtract, as an offset, an amount equal to
half of the promote Leeds earned from an earlier project called Forest Park Flats (the “FPF
Promote”).4
3. The Forest Park Flats Project was sold in May 2017. In August 2017, Leeds
informed Defendants that his FPF Promote totaled $1,021,595.00 (the “Initial FPF Promote
Amount”), meaning their offset would be $510,795.50.
4. After the Amesbury Project was sold in 2018, Defendants sent Plaintiffs a letter
identifying what Defendants had calculated Leeds’s Amesbury Promote to be. The amount was
shockingly low—Defendants’ letter stated they had only earned $4.6 million in profits from the
sale of a $129 million dollar project and that Leeds’s gross Amesbury Promote (before
2
See Exhibit L, Settlement Agreement.
3
See Exhibit L, Settlement Agreement at §3(b)(i).
4
See Exhibit L, Settlement Agreement at §3(c).
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 7
subtracting the offset) was only $317,148.81. This litigation ensued. Crucially, to date,
Defendants admit they have not paid Plaintiffs a single dollar of Amesbury Promote.5
5. In January 2023, while searching for documents responsive to Defendants’
requests for production, Plaintiffs located, and subsequently produced, the 2017 correspondence
they received from their partner on Forest Park Flats that had informed Plaintiffs of the amount
of their return from the Forest Park Flats Project, which included, but was not limited to, the FPF
Promote Amount.6 While reviewing that document, Plaintiffs realized that the Initial FPF
Promote Amount they told Defendants in 2017 was incorrect because Plaintiffs had accidentally
forgotten to subtract out the return of Plaintiffs’ direct equity investment, which should not have
been included in the Initial FPF Promote Amount, based on the contractual definition of
“Promote.”7 Accordingly, the amount they told Defendants in 2017 was higher than it should
have been—which gave the impression of a higher offset than was true and actually hurt
Plaintiffs, not Defendants. The correct amount of the FPF Promote was actually $685,156 (the
“Correct FPF Promote Amount”), and Defendants’ correct offset amount was $342,578.00. That
Plaintiffs mistakenly told Defendants the incorrect amount is of no legal consequence because
Defendants: have not paid Plaintiffs any Amesbury Promote (though if they had, they would
have under-paid Plaintiffs because the Initial FPF Promote Amount rendered the offset higher
than it should have been), have not taken any action in reliance on Plaintiffs’ mistaken Initial
5
Exhibit A, Coady at 30:24-31:15; Exhibit B, Elliott Tr. at 39:10-20; Exhibit D, SWC Tr. at 50:18-20; Exhibit F,
SWCM Tr. at 18:14-16.
6
Exhibit P, Sherman and Stillwater Capital Investment, LLC Answer.
7
Exhibit L, Settlement Agreement § 3(b)(i).
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 8
FPF Promote amount, and have not paid any money to Plaintiffs after receiving the Initial FPF
Promote Amount or the Correct FPF Promote Amount.8
6. After receiving Plaintiffs’ January 18, 2023, document production containing the
Correct FPF Promote Amount, Defendants did nothing: they did not send additional discovery,
they did not call Plaintiffs’ counsel to request an explanation, and they did not request Plaintiffs’
depositions to explain the discrepancy.
7. Defendants finally deposed Plaintiff Jason Leeds, individually, on June 29, 2023,
and questioned him about the Initial FPF Promote, the Correct FPF Promote, the difference
between the two amounts, and Plaintiffs’ mistake.9 Following the deposition, Defendants sent no
additional discovery to Plaintiffs to seek further explanation or clarification about Plaintiffs’
innocent mistake and did not request a corporate representative deposition. Defendants did not
even send an email to Plaintiffs’ counsel expressing a concern about the issue or the need for
additional information. Fact discovery closed on June 30, 2023.10
8. On September 1, 2023, after this suit had been pending for more than two-and-a-
half years, and after the close of discovery, Defendants filed their Counterclaims and Affirmative
Defenses.11 Seven days later, on September 8, 2023, Defendants filed their First Amended
Affirmative Defenses.12
9. On November 29, 2023, Defendants Aaron Sherman, Robert Elliott, and Richard
Coady, in their individual capacity, and corporate representatives of Stillwater Capital
8
Exhibit D, SWC Tr. at 31:4-10, 43:20-25, 44:7-45:4, 45:16-49:12, 50:18-20; Exhibit B, Elliott Tr. at 22:22-
28:16, 34:11-14, 35:12-36:3, 36:4-10, 39:10-20, 47:11-48:24; Exhibit A, Coady Tr. at 42:7-43:1, 43:2-11, 44:2-13;
Exhibit F, SWCM Tr. at 18:14-16, 31:4-32:9, 37:6-17; Exhibit G, Walther Tr. at 140:12-16, 140:17-22; Exhibit E,
SW AP-1 Tr. at 9:19-10:14; Exhibit C, Sherman Tr. at 5:11-6:4.
9
Exhibit K, Leeds Tr. at 55:18-65:21.
10
Exhibit Y, Second Amended Scheduling Order.
11
Exhibit H, Defendants’ First Amended Answer and Counterclaims.
12
Exhibit I, Defendants’ First Amended Affirmative and Other Defenses.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 9
Investments, LLC, Stillwater AP-1 LLC, and SW Company Manager II, LLC were all deposed.13
They universally testified that they could offer no testimony or evidence in support of their
counterclaims or affirmative defenses, could not testify that learning the Initial FPF Promote in
2017 and the Correct FPF Promote amount caused them any damage, could not articulate or
identify that they had even suffered any damage, and could not identify the alleged amount of
any damages they were seeking.
10. Specifically, the Defendants’ testified to the following:
11. Richard Coady testified as follows:
a. Admitted he’d never seen the Counterclaims, provided no
information to support them, and had no understanding of what he
is alleging.14 The deposition was, “[T]he first time [he’s] seen the
document. Again, there’s plenty of people you could probably get
the answers from. I’m not one of them;”15
b. Admitted he has no knowledge whether the statements in the
counterclaims filed on his behalf contain true or false statements;16
c. Dec. Action - Admitted that Defendants’ Dec. Action asks the
Court to declare that Jason Leeds does not, and cannot, owe
Defendants any money, and Defendants agree with Plaintiffs’ Dec.
Action and believe it to be just and true.17 Admitted he has not paid
Plaintiffs any money and has no knowledge that any Defendant has
paid Plaintiffs any money.18 Admitted he has no knowledge that
Plaintiffs are in possession of any money that rightfully belongs to
him or the other Defendants.19 Admitted he had no idea how
Leeds’ Promote is supposed to be calculated or what money the
Defendants owe Leeds;20
13
See generally Exhibits A through F.
14
Exhibit A, Coady Tr. at 22:10-23:6.
15
Id. at 48:13-19.
16
Id.at 48:25-49:3.
17
Id. at 24:12-16.
18
Id. at 31:1-15.
19
Id. at 31:16-23.
20
Id. at 34:19-25.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 10
d. Breach of Contract - Admitted he had no idea how Plaintiffs
allegedly breached the settlement and could not testify about that,21
had no personal knowledge of any damage he has suffered as a
result of Plaintiffs allegedly breaching the settlement agreement,22
and was not aware of any financial loss he has suffered;23
e. Fraud/Negligent Misrepresentation - With respect to the fraud
claim, he testified that the entire claim is based on Leeds telling the
Defendants an incorrect amount of his FPF Promote in 2017, but
he admitted he had no evidence and cannot testify that Leeds
provided the incorrect amount intentionally.24 He admitted that he
took no action in reliance of learning the incorrect FPF Promote
amount in 2017 and has no knowledge of any of the Defendants
taking any action in reliance upon learning the incorrect FPF
Promote amount in 2017.25 He had no knowledge that any of the
Defendants suffered any financial loss as a result of Leeds
accidentally telling the Defendants the incorrect FPF Promote
amount in 2017.26 He also had no knowledge of the Defendants
taking any action upon learning the corrected FPF Promote
amount;27
f. Unjust Enrichment – Admitted he had no knowledge about how
Plaintiffs are allegedly wrongfully in possession of money or
property derived from the sale of Forest Park Flats, and he has no
knowledge about and cannot testify that any money derived from
that sale belonged to the Defendants;28
g. Quantum Meruit – Testified he didn’t know what he’s seeking to
recover and isn’t the one to ask,29 isn’t qualified to testify about the
services and materials Leeds allegedly benefited from and accepted
from the Defendants, or how Leeds allegedly benefited from
21
Id. at 39:7-9.
22
Id. at 39:10-18.
23
Id. at 39:19-25.
24
Id. at 40:5-41:4.
25
Id. at 42:7-43:1.
26
Id. at 43:2-11.
27
Id. at 44:2-13.
28
Id. at 44:14-46:21.
29
Id. at 49:4-12.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 11
them,30 and has no idea how the Defendants were allegedly
expecting to be paid or the alleged amount;31
h. Money Had and Received – Testified he had “no idea” what
money Leeds allegedly has that he was supposed to pay to the
Defendants, nor did he have any knowledge about a contract or
agreement that would obligate Leeds to pay the Defendants any
money;32
i. Affirmative Defenses – Testified he had no knowledge about
them, isn’t qualified to answer questions about them, and cannot
offer any testimony about any of the affirmative defenses or any
factual bases that would support them.33
12. Robert Elliot testified as follows:
a. Testified he had never seen the counterclaims before and did not
participate in drafting them or providing information about them;34
b. Testified he had no knowledge about, and cannot offer testimony
regarding, whether or not the Defendants suffered any damages as
a result of Leeds accidentally telling them the wrong FPF Promote
amount in 2017 or the amount of any such alleged damages;35
c. Admitted he had no personal knowledge about the correct amount
of Leeds’s FPF Promote, and that he did not rely on the amount
Leeds told the Defendants in 2017;36
d. Admitted he was not aware that he suffered any injury resulting
from Leeds accidentally telling the Defendants the incorrect FPF
Promote amount in 2017;37
e. Admitted he had not personally paid Leeds any of his Amesbury
Promote and had no knowledge whether any of the Defendants
have done so;38
30
Id. at 49:13-23.
31
Id. at 49:24-50:10.
32
Id. at 50:11-51:9.
33
Id. at 51:13-59:16.
34
Exhibit B, Elliott Tr. at 23:19-24:14.
35
Id. at 22:22-23:16.
36
Id. at 34:11-14, 35:12-36:3.
37
Id. at 36:4-10.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 12
f. Admitted he had no personal knowledge that Leeds is wrongfully
in the possession of any money that rightfully belongs to
Defendants;39
g. Dec. Action – Admitted that Defendants’ Amended Initial
Disclosures state that Plaintiffs owe Defendants nothing.40 He
admitted that Defendants’ Disclosures further state that “Plaintiffs’
allegations seeking declaratory relief are just and true and no
dispute exists as to them;”41
h. Breach of Contract – Admitted he had no knowledge how Leeds
allegedly breached the contract, has no knowledge of how he was
allegedly injured,42 and has no knowledge of “how to define or
quantify” any alleged injury and was unable to offer any testimony
about any of these things;43
i. Fraud/Negligent Misrepresentation – Testified he had no
information or knowledge and could not offer any testimony about
Defendants’ fraud claims, could not identify any allegedly
fraudulent statements Leeds made, could not testify that any
alleged statement was made intentionally, could not offer any
testimony explaining how he allegedly relied on any statement
Leeds made, and could not offer any testimony about the damages
he has allegedly suffered;44
j. Unjust Enrichment – Testified he had no information or
knowledge, and could not offer any testimony, about Defendants’
unjust enrichment claims;45
k. Quantum Meruit - Testified he had no information or knowledge,
and could not offer any testimony, about Defendants’ quantum
meruit claims;46
38
Id. at 39:10-20.
39
Id. at 39:21-40:6
40
Id. at 19:20-20:7.
41
Id. at 20:12-18.
42
Exhibit B, Elliott Tr. at 50:12-51:15.
43
Id. at 46:22-47:10.
44
Id.at 47:11-48:24.
45
Id.at 48:25-49:20.
46
Id.at 49:21-50:11.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 13
l. Money Had and Received - Testified he had no information or
knowledge, and could not offer any testimony, about Defendants’
money had and received claims;47
m. Affirmative Defenses – Testified he had never seen the
affirmative defenses before and did not participate in drafting them
nor did he provide information to support the affirmative defenses,
and he was unable to provide any testimony about them or in
support of them.48
13. Robert Aaron Sherman was deposed, individually and in his capacity as the
Corporate Representative for Stillwater Capital Investments, LLC, Stillwater AP-1 LLC, and SW
Company Manager II, LLC, and testified as follows:
a. Sherman admitted the Defendants have not paid Plaintiffs any
portion of the Amesbury Promote;49
b. Sherman adopted all the answers he provided in his capacity as the
corporate representative for Stillwater Capital Investments, LLC
and SW Company Manager II, LLC;50
c. Sherman testified he was not prepared to testify about the dollar
amounts of any damages that he or any of the corporate defendants
allegedly suffered;51
d. Sherman testified he had no personal knowledge, and neither does
SWCM, regarding the amount of money, if any, that SWCM has
paid to Plaintiffs;52
e. Sherman testified he and the Defendant companies have no
knowledge regarding the “buckets” or categories of alleged
damages that any of the Defendants suffered (other than attorneys’
fees generated from this lawsuit, which they would have incurred
anyway because they refuse to pay the Amesbury Promote that
Plaintiffs are claiming) and were unable to testify about them;53
47
Id.at 50:12-51:15.
48
Id.at 51:16-52:13.
49
Exhibit D, SWC Tr. at 50:18-20.
50
Exhibit E, SW AP-1 Tr. at 9:19-10:14; Exhibit C, Sherman Tr. at 5:11-6:4.
51
Exhibit F, SWCM Tr. at 18:17-20, 20:8-17, 21:25-22:9.
52
Id. at 18:14-16.
53
Id. at 22:20-23:23; Exhibit D, SWC Tr. at 49:22-50:17.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 14
f. Sherman testified that the FPF Promote offset was purely intended
to be an offset against the amount of money that Defendants owed
Plaintiffs and that Plaintiffs never agreed to pay the Defendants
any money.54
g. Sherman testified that the provision in the Settlement Agreement
requiring Plaintiffs to inform Defendants of the FPF Promote
“within 10 business days of the closing of any sale of Forest Park
Flats…” was included solely because Sherman wanted to know
and not for any other reason—in other words, it was not material to
any business decision;55
h. Sherman testified he cannot identify anything the Defendants
would have done differently if he had learned the Correct FPF
Promote Amount in 2017 when he learned the Initial FPF Promote
Amount and therefore suffered no damages as a result of the
mistake;56
i. Sherman testified the Defendants learned of the Initial FPF
Promote Amount on or around August 24, 2017, when he
instructed Alex Maki to send Plaintiffs an email, and Defendants
received a letter from Plaintiffs disclosing the Initial FPF Promote
Amount a day or two later;57
j. Sherman testified he and, by extension, the other Defendants have
no personal knowledge what the true, correct FPF Promote amount
is.58 Therefore, they cannot offer any evidence to refute the Correct
FPF Promote Amount;
k. Sherman and, by extension, Stillwater Capital Investments
believed that Plaintiffs breached the Settlement Agreement by not
informing them of the FPF Promote within ten days in 2017, but
despite believing this, they did not bring suit for the alleged breach
until September 2023;59
54
Exhibit F, SWCM Tr. at 31:4-32:9.
55
Exhibit L, Settlement Agreement § 3(c); Exhibit F, SWCM Tr. at 37:6-17.
56
Exhibit D, SWC Tr. at 51:23-52:17.
57
Exhibit F, SWCM Tr. at 34:22-35:19; Exhibit D, SWC Tr. at 32:23-33:3, 43:20-44:1; Exhibit R, Leeds Initial
FPF Promote Letter dated August 24, 2017 (PLTF LEEDS 000951).
58
Exhibit D, SWC Tr. at 31:4-10.
59
Id. at 32:19-33:3.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 15
l. Sherman testified that Defendants would never pay the Amesbury
Promote amount that Plaintiffs are seeking, regardless of how
much the FPF Promote offset is.60 This means that this litigation
would have ensued, and Defendants would have incurred the same
attorneys’ fees regardless of whether they were originally told the
Correct FPF Amount or not;61
m. Breach of Contract – Testified that he did not know the amount
of damages Defendants allegedly suffered as a result of the alleged
breach of contract and was unable to provide testimony about it or
in support of any damage amount.62 Sherman admitted that when
Defendants received the Initial FPF Promote Amount in 2017, they
did not take any actions in detrimental reliance on the amount
provided and therefore have no damages.63 Sherman further
testified that, after learning of the Correct FPF Promote Amount in
August 2023, the Defendants took no action in detrimental reliance
of that amount and have no damages as a result of learning it;64
n. Fraud/Negligent Misrepresentation – Testified that he did not
know the amount of damages Defendants allegedly suffered as a
result of the alleged fraud/negligent misrepresentation and was
unable to provide testimony about it or in support of any damage
amount.65 Sherman and, by extension, Stillwater Capital admitted
that they have no knowledge that Plaintiffs sent the wrong FPF
Promote Amount intentionally.66 Sherman admitted that when
Defendants received the Initial FPF Promote Amount in 2017, they
did not take any actions in detrimental reliance on the amount
provided and therefore have no damages.67 Sherman further
testified that, after learning of the Correct FPF Promote Amount in
August 2023, Defendants took no action in detrimental reliance of
that amount and have no damages as a result of learning it;68
o. Unjust Enrichment - Testified he did not know the amount of
damages it suffered as a result of the alleged unjust enrichment and
60
Id. at 36:19-37:8, 52:18-53:18.
61
Id. at 38:1-3.
62
Exhibit F, SWCM Tr.at 17:20-23.
63
Exhibit D, SWC Tr. at 43:20-25. 44:7-45:4.
64
Id. at 45:16-49:12.
65
Exhibit F, SWCM Tr.at 17:24-18:1.
66
Exhibit D, SWC Tr. at 41:13-42:3.
67
Id. at 43:20-23, 44:7-45:4.
68
Id. at 45:16-49:12.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 16
was unable to provide testimony about it or in support of any
damage amount;69
p. Quantum Meruit – Testified that he does not know the amount of
damages it suffered as a result of the alleged quantum meruit and
was unable to provide testimony about it or in support of any
damage amount;70
q. Money Had and Received – Testified that he does not know the
amount of damages it suffered as a result of the alleged money had
and received and was unable to provide testimony about it or in
support of any damage amount.71
14. On December 5, Defendants’ expert witness, Andrew Walther, was deposed.72
Walther testified he had not calculated any damages and did not intend to offer any opinions
about Defendants’ alleged counterclaim damages.73 He also is not offering any opinions as to the
causation elements of Defendants’ counterclaims.74 Walther has never even seen Defendants’
September 8, 2023 Amended Affirmative Defenses and therefore cannot offer any testimony in
support of them.75 Beyond that, he has no testimony to support Defendants’ previously filed
September 1, 2023 affirmative defenses either.76
IV.
BASIS FOR SUMMARY JUDGMENT
Plaintiffs are entitled to judgment as a matter of law because an adequate time for
discovery has passed, and Defendants have testified that they have no evidence, and cannot
69
Exhibit F, SWCM Tr. at 18:2-4.
70
Id. at 18:5-7.
71
Id. at 18:8-10.
72
See generally Exhibit G, Excerpts of Walther Tr.
73
Exhibit G, Walther Tr. at 140:12-16.
74
Id. at 140:17-22.
75
Id. at 140:23-141:15.
76
Id. at 141:10-24.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 17
present any evidence, of one or more elements of each of their counterclaims or their affirmative
defenses. Specifically, Defendants have not produced, and admitted they cannot provide, any
evidence of causation, damages, falsity, reliance, or materiality.
V.
LEGAL STANDARD
After adequate time for discovery, a defendant is entitled to summary judgment if the
plaintiff failed to produce evidence on one or more of the essential elements of a claim for which
the plaintiff bears the burden of proof. TEX. R. CIV. P. 166a(i). Under the “no evidence”
summary judgment standard, the party with the burden at trial will have the same burden of
proof in a summary judgment proceeding. See id.; Reid v. Compass Group USA, Inc., 172
S.W.3d 203, 205 (Tex. App.—El Paso 2005, no pet.). Once a defendant moves for no evidence
summary judgment, the plaintiff must produce more than a scintilla of probative evidence raising
a genuine issue of material fact to defeat the motion. See TEX. R. CIV. P. 166a(i); Reid, 172
S.W.3d at 205; Harrill v. A.J’s. Wrecker Serv., 27 S.W.3d 191, 193 (Tex. App.—Dallas 2000,
dism’d w.o.j.).
The party opposing a no evidence motion for summary judgment may not rest upon the
allegations of its pleadings; the party must present evidence that raises a fact issue on the
challenged elements. See King v. Texas Dep’t of Human Servs., 28 S.W.3d 27, 34 (Tex. App.—
Austin 2000, no pet.). The non-movant must come forward with admissible evidence that creates
a genuine issue of fact as to all the essential elements of his claims upon which he will bear the
burden of proof at trial. Frazier v. Khai Loong Yu, 987 S.W.2d 607 (Tex. App.—Fort Worth
1999, pet. denied). The court must grant the motion unless the respondent produces summary
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 18
judgment evidence raising a genuine issue of material fact. TEX. R. CIV. P. 166a(i); Western
Invs., Inc. v. Urena, 162 S.W.3d 547, 550 (Tex. 2005).
VI.
ARGUMENT AND AUTHORITIES
A. ALL OF DEFENDANTS’ COUNTERCLAIMS ARE TIME BARRED BY THE APPLICABLE
STATUTES OF LIMITATIONS.
Plaintiffs incorporate all prior paragraphs, including those in the statement of facts as if
set forth fully herein.
There is a four-year statute of limitations for the declaratory judgment, breach of
contract, quantum meruit, fraud, unjust enrichment, and money had and received counterclaims.
Tex Civ. Prac. Rem. Code § 16.004, § 16.051. Negligent misrepresentation is governed by the
two-year statute of limitations. Id. at § 16.003. Each cause of action accrues on the date of injury.
All of the counterclaims other than declaratory relief are based upon Plaintiffs’ August
24, 2017, letter to Defendants that inadvertently provided the incorrect Initial FPF Promote
Amount.77 And Defendants’ counterclaim for declaratory relief is based on the language of the
Settlement Agreement, which was executed on August 26, 2015.
Robert Aaron Sherman, Defendants’ corporate representative, who is also the only person
with any personal knowledge, admitted that (1) he received Leeds’s communication on or about
August 24, 2017, that stated what the Promote amount was, (2) he knew that it was more than ten
days after the closing date of the Forest Park Flats sale which he alleges is a breach of the
settlement agreement, and (3) he did nothing to investigate his claim or how much the correct
promote amount actually was.78 The other Defendants testified they had no knowledge of, and
77
Exhibit R, Leeds Initial FPF Promote Letter (PLTF LEEDS 000951).
78
Exhibit F, SWCM Tr. at 34:22-35:19; Exhibit D, SWC Tr. at 32:23-33:3, 43:20-44:1.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 19
could not provide any testimony about, their counterclaims, so they cannot refute Sherman’s
testimony.79 Accordingly, there is no genuine issue of material fact that the claims accrued on or
about August 24, 2017, at the latest, when Defendants were informed of the Initial FPF Promote
Amount that Defendants alleged caused their injuries, and which is more than six years before
the counterclaims were filed.
Therefore, it is undisputed that all counterclaim causes of action accrued more than four
years prior to the counterclaims being filed. Accordingly, all of the counterclaims are time
barred.
B. PLAINTIFFS ARE ENTITLED TO SUMMARY JUDGMENT ON DEFENDANTS’ DECLARATORY
JUDGMENT CLAIM BECAUSE DEFENDANTS’ OWN PLEADINGS AND DISCLOSURES
CONCLUSIVELY ESTABLISH THAT THERE IS NO GENUINE ISSUE OF MATERIAL FACT.
Plaintiffs incorporate all prior paragraphs, including those in the statement of facts as if
set forth fully herein.
Defendants’ Declaratory Judgment claim (“Defendants’ Dec. Action”) literally mirrors
Plaintiffs’ Declaratory Judgment claim (“Plaintiffs’ Dec. Action”), concedes the factual basis on
which Plaintiffs’ Dec. Action is based, concedes that Plaintiffs’ Dec. Action is just and that no
dispute exists, and asks the Court to render the same judgment.
For comparison:
Defendants’ First Amended Answer,
80
Plaintiffs’ Third Amended Petition Affirmative and Other Defenses and
Counterclaims81
68. Therefore, Plaintiff seeks a declaratory 44. Therefore, Defendants seek a declaratory
judgment, granting its requested declaratory relief judgment, granting its requested declaratory
that it owes nothing out of pocket other than as relief that Plaintiffs owe nothing out of pocket
79
Exhibit A, Coady Tr. at 22:10-23:6, 48:13-19, 48:25-49:3; Exhibit B, Elliott Tr. at 23:19-24:14, 22:22-23:16,
36:4-10.
80
Exhibit Z, Plaintiffs’ Third Amended Petition at ¶ 68.
81
Exhibit H, Defendants’ First Amended Answer and Counterclaims at ¶ 44.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 20
an offset to whatever Leeds is entitled to under other than as a reduction to whatever Plaintiffs
the balance of the agreement. may be entitled to under the balance of the
agreement.
They seek identical relief—which is a declaration that Plaintiffs owe nothing out of
pocket—thus, there is no disagreement or issue for any fact finder to decide.
Further, Defendants’ Amended Initial Disclosures contain a copied and pasted version of
the counterclaims and admit the same.82
Plaintiffs repeatedly attempted to confer with Defendants to discuss the lack of any
genuine issue and to obtain an agreed partial judgment to avoid wasting cost and judicial
resources. But, as has become typical in this case, Defendants repeatedly refused to respond and
then finally responded with an incomprehensible, rambling statement about unrelated issues.83
The true purpose behind Defendants’ pleading can be found in paragraph 45 of the
counterclaim: “Defendants seek their attorneys’ fees with respect to this Count A per the
declaratory judgment statute.”84 Defendants’ bad faith pleading makes a mockery of this Court,
and Defendants’ counsel should be sanctioned, again, for the fourth time in this case.85
Accordingly, this Court should render summary judgment against Defendants’
declaratory judgment action and grant summary judgment as to Plaintiffs’ declaratory judgment
action that has been on file for almost three years.
82
Exhibit J, Defendants’ Amended Initial Disclosures at ¶¶ 42-44.
83
See Exhibit S, November 2, 2023, email chain between counsel regarding Agreed Partial Judgment; Exhibit T,
Proposed Agreed Partial Judgment.
84
Exhibit H, Defendants’ First Amended Answer and Counterclaims at ¶ 45.
85
Exhibits U through X, Orders sanctioning Defendants’ counsel for discovery misconduct.
PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT
ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 21
C. DEFENDANTS’ CLAIMS FAIL AS A MATTER OF LAW BECAUSE DEFENDANT
Preview
FILED 12/28/2023 4:52 PM FELICIA PITRE DISTRICT CLERK DALLAS CO., TEXAS Kellie Juricek DEPUTY CAUSE NO. DC-21-00298 LEEDS REAL ESTATE SERVICES, INC. and, § IN THE DISTRICT COURT JASON LEEDS, INDIVIUDALLY § Plaintiffs, § § v. § § STILLWATER CAPITAL INVESTMENTS, § LLC; ROBERT AARON SHERMAN, § Individually; RICHARD J. COADY, IV, § Individually, and ROBERT C. ELLIOTT, § 162nd JUDICIAL DISTRICT Individually; SW PARTNER HOLDINGS, II, § LLC; STILLWATER RESIDENTIAL § INVESTMENTS II, LLC; S.W. COMPANY § MANAGER II, LLC; SWSB PHASE I, LLC; § SWSB PHASE II, LLC; STILLWATER AP-1 § DEVELOPMENT, LLC; and STILLWATER § AP-2 DEVELOPMENT, LLC, § § Defendants. § DALLAS COUNTY, TEXAS PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 1 I. INTRODUCTION AND SUMMARY Plaintiffs Leeds Real Estate Services, Inc. and Jason Leeds (“Leeds,” collectively, or “Plaintiffs”) respectfully file this Traditional Motion for Partial Summary Judgment to dismiss all of the counterclaims and affirmative defenses brought by Defendants Robert Aaron Sherman, Robert C. Elliott, Richard J. Coady, IV, Stillwater Capital Investments, LLC (“Stillwater”), Stillwater AP-1 Development, LLC (“SW AP-1”), and S.W. Company Manager II, LLC (“SWCM”) (collectively, “Defendants,” and with Plaintiffs, the “Parties”). The bases for this motion are straightforward. Generally, Defendants’ counterclaims and affirmative defenses all arise out of the allegation that, under the Parties’ August 26, 2015, settlement agreement (the “Settlement Agreement”), Leeds was supposed to have informed Defendants of the amount of profits Leeds’s earned (called a “Promote” in real estate speak) from the sale of a multifamily development project called Forest Park Flats (“FPF Promote”)— importantly, this is a different project than the “Amesbury Project” that forms the basis of Plaintiffs’ claims. Leeds was supposed to tell Defendants this amount because, under the Settlement Agreement, Defendants are entitled to use 50% of Leeds’s FPF Promote amount as an offset against the amount they owe him from the sale of another project (the one at issue in this lawsuit) called the “Amesbury Project.” Leeds informed Defendants what his Promote was from the Forest Park Flats Project, in writing, on August 24, 2017, but he inadvertently sent the wrong number—specifically, Leeds’s math was wrong because he forgot to deduct the portion of proceeds he earned from his “co- invest,” which amount is explicitly excluded from the definition of “Promote” in the Settlement Agreement—in other words, Leeds accidentally told Defendants an FPF Promote amount that PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 2 was too high, which actually hurt Leeds, not Defendants. Leeds corrected his mistake as soon as he realized it, which happened to be when he was searching for documents responsive to Defendants’ requests for production during discovery, and he produced a responsive document showing the correct amount. Leeds then explained the mistake and the proper calculation during his own deposition, in his Amended Initial Disclosure, and through the designation and deposition testimony of Plaintiffs’ expert, David Fuller. The counterclaims and affirmative defenses should be dismissed for five simple reasons: First, all of Defendants’ counterclaims, and all affirmative defenses arising from or relying on Defendants’ counterclaims, are time barred.1 Second, Defendants’ Declaratory Judgment claim (Count A) is a mirror image of Plaintiffs’ Declaratory Judgment cause of action, concedes that Plaintiffs’ declaratory judgment claim is correct and just and that there is no issue of fact, and essentially asks the Court to issue a declaration that Plaintiffs’ declaratory judgment is true and correct. Despite filing this, Defendants refuse to jointly submit an agreed partial judgment for the Court’s signature on this issue. Therefore, the Court should grant Plaintiffs’ summary judgment on its declaratory judgment claim that has been pending since this case’s inception, and grant summary judgment against Defendants’ declaratory judgment claim which, as explained below, is nothing more than a bad faith, smoke-and-mirrors attempt by Defendants to recover attorneys’ fees. Third, all the Defendants were deposed, and none of them could articulate a single theory of causation or any colorable damages in support of any of their claims. Both of these are requisite elements of all the counterclaims other than Count A—request for declaratory judgment. In fact, the Defendants’ testimony conclusively established that Plaintiffs’ alleged 1 The following affirmative defenses arise from or rely on the counterclaims, paras 16, 17, 18, 20, 21, 22, 24, 25, 26, 27, 33, and 38 in Exhibit I, Defendants’ First Amended Affirmative and Other Defenses. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 3 conduct cause no damages, and that Defendants actually suffered no damages at all, regardless of the alleged cause. When asked, Robert Aaron Sherman testified, on behalf of himself and all other Defendants, that he could not identify any colorable damages. He admitted that when he received the initial FPF Promote amount from Leeds, he made no decision based upon the amount; he also admitted that after receiving the correct FPF amount this year during discovery, he did not have to reverse a single decision he had made previously based upon the initially disclosed amount, and he admitted that neither he nor his businesses lost a single contract, customer, deal, opportunity, partner, lender, or investor—not a penny was lost because the FPF Promote amount they were told changed or because the correct number was learned later than anticipated. The only thing Defendants noted is that the correct FPF Promote amount was lower than the initially reported amount—but that is not “damage,” it is simply a correction; Plaintiffs’ mistake in reporting the correct amount did not “cause” the Promote amount or offset to actually change or become lower. The other Defendants, Coady and Elliott, also testified they could not articulate any causation or damages and punted the issue to “other people.” Finally, Defendants’ damages expert, Andrew Walther, testified he has no opinion about any alleged counterclaim damages and will not offer any such opinions at trial. Fourth, Defendants further admit that they have no knowledge of, and cannot offer any testimony or evidence in support of, the falsity, intent, or reliance elements of their Fraud and Negligent Misrepresentation claims (Counts C and D). Fifth, Defendants further admit away each of their equitable claims because, to date, they have not paid any money to Plaintiffs, and, more specifically, they did not pay a penny to the Plaintiffs based upon the alleged FPF Promote amount mistake. Therefore, the Unjust Enrichment, Quantum Meruit, and Money Had and Received claims (Counts E, F, and G) are PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 4 baseless. What is more, the existence of the Settlement Agreement (which is a valid, enforceable contract) precludes these equitable claims as a matter of law. Defendants’ affirmative defenses similarly lack any evidentiary support, and each of the Defendants and their expert witness universally testified they can provide no evidence or testimony in support of them. This testimony conclusively negates the affirmative defenses as a matter of law, and they should similarly be denied. II. SUMMARY JUDGMENT EVIDENCE Exhibit A: Excerpts of Deposition of Richard Coady (“Coady Tr.”) Exhibit B: Excerpts of Deposition of Robert Elliott (“Elliott Tr.”) Exhibit C: Excerpts of Deposition of Robert Aaron Sherman (“Sherman Tr.”) Exhibit D: Excerpts of Deposition of Robert Aaron Sherman, Corporate Representative of Stillwater Capital Investments, LLC (“SWC Tr.”) Exhibit E: Excerpts of Deposition of Robert Aaron Sherman, Corporate Representative of Stillwater AP-1, LLC (“SW AP-1 Tr.”) Exhibit F: Excerpts of Deposition of Robert Aaron Sherman, Corporate Representative of SW Company Manager II, LLC (“SWCM Tr.”) Exhibit G: Excerpts of Deposition of Defendants’ Expert Witness Alexander Walther (“Walther Tr.”) Exhibit H: Defendants’ First Amended Answer and Counterclaims Exhibit I: Defendants’ First Amended Affirmative and Other Defenses Exhibit J: Defendants’ Amended Initial Disclosures Exhibit K: Excerpts of Deposition of Plaintiff Jason Leeds (“Leeds Tr.”) Exhibit L: Settlement Agreement Exhibit M: Plaintiff’s Original Petition PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 5 Exhibit N: SW Company Manager II, LLC; Stillwater AP-1, LLC; and Robert Elliot, Individually, Answer Exhibit O: Richard Coady Answer Exhibit P: Robert Aaron Sherman and Stillwater Capital Investment, LLC’s Answer Exhibit Q: Forest Park Flats Promote Information (PLTF LEEDS 000794-95) Exhibit R: Leeds’s Letter Providing Initial FPF Promote Amount (PLTF LEEDS 000951) Exhibit S: November 2, 2023, email chain regarding Agreed Partial Judgment Exhibit T: Proposed Agreed Partial Judgment Exhibit U: Order Granting Plaintiffs’ Motion to Enforce Order dated May 26, 2023 Exhibit V: Order Granting Plaintiffs’ Amended Motion to Compel dated June 8, 2023 Exhibit W: Order Granting Plaintiffs’ Amended Motion to Compel dated July 5, 2023 Exhibit X: Order Granting Plaintiffs’ Amended Motion to Compel Depositions dated June 8, 2023 Exhibit Y: Second Amended Scheduling Order Exhibit Z: Plaintiffs’ Third Amended Petition III. STATEMENT OF FACTS 1. Plaintiffs filed suit claiming that Defendants breached their settlement agreement with Plaintiffs by failing to pay Plaintiffs the profits interest, or “Promote,” that Plaintiffs were owed. The Promote arose from the profits generated by the sale of two apartment complexes that Plaintiffs and Defendants had developed and constructed together (the “Amesbury Project”). PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 6 “Promote” is a defined term in the August 26, 2015, settlement agreement between Plaintiffs and Defendants (the “Settlement Agreement”)2. It is defined as: For purposes of this Agreement, “Promote” shall refer to the back-end profit payable to a Party hereto (or its designated subsidiary or affiliate) as a matter of contract that exists on the Date of execution of this Agreement, that is or will be earned from the involvement in one of the developments that is the subject of this agreement, as a Sponsor, General Partner, or the equivalent, and can be considered earned from “sweat equity”. “Promote” shall not include that back-end profit that is related to direct equity investment (aka: Co invest) in such developments by the respective parties. (the “Amesbury Promote”).3 2. The Settlement Agreement further provided that, as part of calculating Leeds’s Amesbury Promote, the Defendants were entitled to subtract, as an offset, an amount equal to half of the promote Leeds earned from an earlier project called Forest Park Flats (the “FPF Promote”).4 3. The Forest Park Flats Project was sold in May 2017. In August 2017, Leeds informed Defendants that his FPF Promote totaled $1,021,595.00 (the “Initial FPF Promote Amount”), meaning their offset would be $510,795.50. 4. After the Amesbury Project was sold in 2018, Defendants sent Plaintiffs a letter identifying what Defendants had calculated Leeds’s Amesbury Promote to be. The amount was shockingly low—Defendants’ letter stated they had only earned $4.6 million in profits from the sale of a $129 million dollar project and that Leeds’s gross Amesbury Promote (before 2 See Exhibit L, Settlement Agreement. 3 See Exhibit L, Settlement Agreement at §3(b)(i). 4 See Exhibit L, Settlement Agreement at §3(c). PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 7 subtracting the offset) was only $317,148.81. This litigation ensued. Crucially, to date, Defendants admit they have not paid Plaintiffs a single dollar of Amesbury Promote.5 5. In January 2023, while searching for documents responsive to Defendants’ requests for production, Plaintiffs located, and subsequently produced, the 2017 correspondence they received from their partner on Forest Park Flats that had informed Plaintiffs of the amount of their return from the Forest Park Flats Project, which included, but was not limited to, the FPF Promote Amount.6 While reviewing that document, Plaintiffs realized that the Initial FPF Promote Amount they told Defendants in 2017 was incorrect because Plaintiffs had accidentally forgotten to subtract out the return of Plaintiffs’ direct equity investment, which should not have been included in the Initial FPF Promote Amount, based on the contractual definition of “Promote.”7 Accordingly, the amount they told Defendants in 2017 was higher than it should have been—which gave the impression of a higher offset than was true and actually hurt Plaintiffs, not Defendants. The correct amount of the FPF Promote was actually $685,156 (the “Correct FPF Promote Amount”), and Defendants’ correct offset amount was $342,578.00. That Plaintiffs mistakenly told Defendants the incorrect amount is of no legal consequence because Defendants: have not paid Plaintiffs any Amesbury Promote (though if they had, they would have under-paid Plaintiffs because the Initial FPF Promote Amount rendered the offset higher than it should have been), have not taken any action in reliance on Plaintiffs’ mistaken Initial 5 Exhibit A, Coady at 30:24-31:15; Exhibit B, Elliott Tr. at 39:10-20; Exhibit D, SWC Tr. at 50:18-20; Exhibit F, SWCM Tr. at 18:14-16. 6 Exhibit P, Sherman and Stillwater Capital Investment, LLC Answer. 7 Exhibit L, Settlement Agreement § 3(b)(i). PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 8 FPF Promote amount, and have not paid any money to Plaintiffs after receiving the Initial FPF Promote Amount or the Correct FPF Promote Amount.8 6. After receiving Plaintiffs’ January 18, 2023, document production containing the Correct FPF Promote Amount, Defendants did nothing: they did not send additional discovery, they did not call Plaintiffs’ counsel to request an explanation, and they did not request Plaintiffs’ depositions to explain the discrepancy. 7. Defendants finally deposed Plaintiff Jason Leeds, individually, on June 29, 2023, and questioned him about the Initial FPF Promote, the Correct FPF Promote, the difference between the two amounts, and Plaintiffs’ mistake.9 Following the deposition, Defendants sent no additional discovery to Plaintiffs to seek further explanation or clarification about Plaintiffs’ innocent mistake and did not request a corporate representative deposition. Defendants did not even send an email to Plaintiffs’ counsel expressing a concern about the issue or the need for additional information. Fact discovery closed on June 30, 2023.10 8. On September 1, 2023, after this suit had been pending for more than two-and-a- half years, and after the close of discovery, Defendants filed their Counterclaims and Affirmative Defenses.11 Seven days later, on September 8, 2023, Defendants filed their First Amended Affirmative Defenses.12 9. On November 29, 2023, Defendants Aaron Sherman, Robert Elliott, and Richard Coady, in their individual capacity, and corporate representatives of Stillwater Capital 8 Exhibit D, SWC Tr. at 31:4-10, 43:20-25, 44:7-45:4, 45:16-49:12, 50:18-20; Exhibit B, Elliott Tr. at 22:22- 28:16, 34:11-14, 35:12-36:3, 36:4-10, 39:10-20, 47:11-48:24; Exhibit A, Coady Tr. at 42:7-43:1, 43:2-11, 44:2-13; Exhibit F, SWCM Tr. at 18:14-16, 31:4-32:9, 37:6-17; Exhibit G, Walther Tr. at 140:12-16, 140:17-22; Exhibit E, SW AP-1 Tr. at 9:19-10:14; Exhibit C, Sherman Tr. at 5:11-6:4. 9 Exhibit K, Leeds Tr. at 55:18-65:21. 10 Exhibit Y, Second Amended Scheduling Order. 11 Exhibit H, Defendants’ First Amended Answer and Counterclaims. 12 Exhibit I, Defendants’ First Amended Affirmative and Other Defenses. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 9 Investments, LLC, Stillwater AP-1 LLC, and SW Company Manager II, LLC were all deposed.13 They universally testified that they could offer no testimony or evidence in support of their counterclaims or affirmative defenses, could not testify that learning the Initial FPF Promote in 2017 and the Correct FPF Promote amount caused them any damage, could not articulate or identify that they had even suffered any damage, and could not identify the alleged amount of any damages they were seeking. 10. Specifically, the Defendants’ testified to the following: 11. Richard Coady testified as follows: a. Admitted he’d never seen the Counterclaims, provided no information to support them, and had no understanding of what he is alleging.14 The deposition was, “[T]he first time [he’s] seen the document. Again, there’s plenty of people you could probably get the answers from. I’m not one of them;”15 b. Admitted he has no knowledge whether the statements in the counterclaims filed on his behalf contain true or false statements;16 c. Dec. Action - Admitted that Defendants’ Dec. Action asks the Court to declare that Jason Leeds does not, and cannot, owe Defendants any money, and Defendants agree with Plaintiffs’ Dec. Action and believe it to be just and true.17 Admitted he has not paid Plaintiffs any money and has no knowledge that any Defendant has paid Plaintiffs any money.18 Admitted he has no knowledge that Plaintiffs are in possession of any money that rightfully belongs to him or the other Defendants.19 Admitted he had no idea how Leeds’ Promote is supposed to be calculated or what money the Defendants owe Leeds;20 13 See generally Exhibits A through F. 14 Exhibit A, Coady Tr. at 22:10-23:6. 15 Id. at 48:13-19. 16 Id.at 48:25-49:3. 17 Id. at 24:12-16. 18 Id. at 31:1-15. 19 Id. at 31:16-23. 20 Id. at 34:19-25. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 10 d. Breach of Contract - Admitted he had no idea how Plaintiffs allegedly breached the settlement and could not testify about that,21 had no personal knowledge of any damage he has suffered as a result of Plaintiffs allegedly breaching the settlement agreement,22 and was not aware of any financial loss he has suffered;23 e. Fraud/Negligent Misrepresentation - With respect to the fraud claim, he testified that the entire claim is based on Leeds telling the Defendants an incorrect amount of his FPF Promote in 2017, but he admitted he had no evidence and cannot testify that Leeds provided the incorrect amount intentionally.24 He admitted that he took no action in reliance of learning the incorrect FPF Promote amount in 2017 and has no knowledge of any of the Defendants taking any action in reliance upon learning the incorrect FPF Promote amount in 2017.25 He had no knowledge that any of the Defendants suffered any financial loss as a result of Leeds accidentally telling the Defendants the incorrect FPF Promote amount in 2017.26 He also had no knowledge of the Defendants taking any action upon learning the corrected FPF Promote amount;27 f. Unjust Enrichment – Admitted he had no knowledge about how Plaintiffs are allegedly wrongfully in possession of money or property derived from the sale of Forest Park Flats, and he has no knowledge about and cannot testify that any money derived from that sale belonged to the Defendants;28 g. Quantum Meruit – Testified he didn’t know what he’s seeking to recover and isn’t the one to ask,29 isn’t qualified to testify about the services and materials Leeds allegedly benefited from and accepted from the Defendants, or how Leeds allegedly benefited from 21 Id. at 39:7-9. 22 Id. at 39:10-18. 23 Id. at 39:19-25. 24 Id. at 40:5-41:4. 25 Id. at 42:7-43:1. 26 Id. at 43:2-11. 27 Id. at 44:2-13. 28 Id. at 44:14-46:21. 29 Id. at 49:4-12. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 11 them,30 and has no idea how the Defendants were allegedly expecting to be paid or the alleged amount;31 h. Money Had and Received – Testified he had “no idea” what money Leeds allegedly has that he was supposed to pay to the Defendants, nor did he have any knowledge about a contract or agreement that would obligate Leeds to pay the Defendants any money;32 i. Affirmative Defenses – Testified he had no knowledge about them, isn’t qualified to answer questions about them, and cannot offer any testimony about any of the affirmative defenses or any factual bases that would support them.33 12. Robert Elliot testified as follows: a. Testified he had never seen the counterclaims before and did not participate in drafting them or providing information about them;34 b. Testified he had no knowledge about, and cannot offer testimony regarding, whether or not the Defendants suffered any damages as a result of Leeds accidentally telling them the wrong FPF Promote amount in 2017 or the amount of any such alleged damages;35 c. Admitted he had no personal knowledge about the correct amount of Leeds’s FPF Promote, and that he did not rely on the amount Leeds told the Defendants in 2017;36 d. Admitted he was not aware that he suffered any injury resulting from Leeds accidentally telling the Defendants the incorrect FPF Promote amount in 2017;37 e. Admitted he had not personally paid Leeds any of his Amesbury Promote and had no knowledge whether any of the Defendants have done so;38 30 Id. at 49:13-23. 31 Id. at 49:24-50:10. 32 Id. at 50:11-51:9. 33 Id. at 51:13-59:16. 34 Exhibit B, Elliott Tr. at 23:19-24:14. 35 Id. at 22:22-23:16. 36 Id. at 34:11-14, 35:12-36:3. 37 Id. at 36:4-10. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 12 f. Admitted he had no personal knowledge that Leeds is wrongfully in the possession of any money that rightfully belongs to Defendants;39 g. Dec. Action – Admitted that Defendants’ Amended Initial Disclosures state that Plaintiffs owe Defendants nothing.40 He admitted that Defendants’ Disclosures further state that “Plaintiffs’ allegations seeking declaratory relief are just and true and no dispute exists as to them;”41 h. Breach of Contract – Admitted he had no knowledge how Leeds allegedly breached the contract, has no knowledge of how he was allegedly injured,42 and has no knowledge of “how to define or quantify” any alleged injury and was unable to offer any testimony about any of these things;43 i. Fraud/Negligent Misrepresentation – Testified he had no information or knowledge and could not offer any testimony about Defendants’ fraud claims, could not identify any allegedly fraudulent statements Leeds made, could not testify that any alleged statement was made intentionally, could not offer any testimony explaining how he allegedly relied on any statement Leeds made, and could not offer any testimony about the damages he has allegedly suffered;44 j. Unjust Enrichment – Testified he had no information or knowledge, and could not offer any testimony, about Defendants’ unjust enrichment claims;45 k. Quantum Meruit - Testified he had no information or knowledge, and could not offer any testimony, about Defendants’ quantum meruit claims;46 38 Id. at 39:10-20. 39 Id. at 39:21-40:6 40 Id. at 19:20-20:7. 41 Id. at 20:12-18. 42 Exhibit B, Elliott Tr. at 50:12-51:15. 43 Id. at 46:22-47:10. 44 Id.at 47:11-48:24. 45 Id.at 48:25-49:20. 46 Id.at 49:21-50:11. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 13 l. Money Had and Received - Testified he had no information or knowledge, and could not offer any testimony, about Defendants’ money had and received claims;47 m. Affirmative Defenses – Testified he had never seen the affirmative defenses before and did not participate in drafting them nor did he provide information to support the affirmative defenses, and he was unable to provide any testimony about them or in support of them.48 13. Robert Aaron Sherman was deposed, individually and in his capacity as the Corporate Representative for Stillwater Capital Investments, LLC, Stillwater AP-1 LLC, and SW Company Manager II, LLC, and testified as follows: a. Sherman admitted the Defendants have not paid Plaintiffs any portion of the Amesbury Promote;49 b. Sherman adopted all the answers he provided in his capacity as the corporate representative for Stillwater Capital Investments, LLC and SW Company Manager II, LLC;50 c. Sherman testified he was not prepared to testify about the dollar amounts of any damages that he or any of the corporate defendants allegedly suffered;51 d. Sherman testified he had no personal knowledge, and neither does SWCM, regarding the amount of money, if any, that SWCM has paid to Plaintiffs;52 e. Sherman testified he and the Defendant companies have no knowledge regarding the “buckets” or categories of alleged damages that any of the Defendants suffered (other than attorneys’ fees generated from this lawsuit, which they would have incurred anyway because they refuse to pay the Amesbury Promote that Plaintiffs are claiming) and were unable to testify about them;53 47 Id.at 50:12-51:15. 48 Id.at 51:16-52:13. 49 Exhibit D, SWC Tr. at 50:18-20. 50 Exhibit E, SW AP-1 Tr. at 9:19-10:14; Exhibit C, Sherman Tr. at 5:11-6:4. 51 Exhibit F, SWCM Tr. at 18:17-20, 20:8-17, 21:25-22:9. 52 Id. at 18:14-16. 53 Id. at 22:20-23:23; Exhibit D, SWC Tr. at 49:22-50:17. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 14 f. Sherman testified that the FPF Promote offset was purely intended to be an offset against the amount of money that Defendants owed Plaintiffs and that Plaintiffs never agreed to pay the Defendants any money.54 g. Sherman testified that the provision in the Settlement Agreement requiring Plaintiffs to inform Defendants of the FPF Promote “within 10 business days of the closing of any sale of Forest Park Flats…” was included solely because Sherman wanted to know and not for any other reason—in other words, it was not material to any business decision;55 h. Sherman testified he cannot identify anything the Defendants would have done differently if he had learned the Correct FPF Promote Amount in 2017 when he learned the Initial FPF Promote Amount and therefore suffered no damages as a result of the mistake;56 i. Sherman testified the Defendants learned of the Initial FPF Promote Amount on or around August 24, 2017, when he instructed Alex Maki to send Plaintiffs an email, and Defendants received a letter from Plaintiffs disclosing the Initial FPF Promote Amount a day or two later;57 j. Sherman testified he and, by extension, the other Defendants have no personal knowledge what the true, correct FPF Promote amount is.58 Therefore, they cannot offer any evidence to refute the Correct FPF Promote Amount; k. Sherman and, by extension, Stillwater Capital Investments believed that Plaintiffs breached the Settlement Agreement by not informing them of the FPF Promote within ten days in 2017, but despite believing this, they did not bring suit for the alleged breach until September 2023;59 54 Exhibit F, SWCM Tr. at 31:4-32:9. 55 Exhibit L, Settlement Agreement § 3(c); Exhibit F, SWCM Tr. at 37:6-17. 56 Exhibit D, SWC Tr. at 51:23-52:17. 57 Exhibit F, SWCM Tr. at 34:22-35:19; Exhibit D, SWC Tr. at 32:23-33:3, 43:20-44:1; Exhibit R, Leeds Initial FPF Promote Letter dated August 24, 2017 (PLTF LEEDS 000951). 58 Exhibit D, SWC Tr. at 31:4-10. 59 Id. at 32:19-33:3. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 15 l. Sherman testified that Defendants would never pay the Amesbury Promote amount that Plaintiffs are seeking, regardless of how much the FPF Promote offset is.60 This means that this litigation would have ensued, and Defendants would have incurred the same attorneys’ fees regardless of whether they were originally told the Correct FPF Amount or not;61 m. Breach of Contract – Testified that he did not know the amount of damages Defendants allegedly suffered as a result of the alleged breach of contract and was unable to provide testimony about it or in support of any damage amount.62 Sherman admitted that when Defendants received the Initial FPF Promote Amount in 2017, they did not take any actions in detrimental reliance on the amount provided and therefore have no damages.63 Sherman further testified that, after learning of the Correct FPF Promote Amount in August 2023, the Defendants took no action in detrimental reliance of that amount and have no damages as a result of learning it;64 n. Fraud/Negligent Misrepresentation – Testified that he did not know the amount of damages Defendants allegedly suffered as a result of the alleged fraud/negligent misrepresentation and was unable to provide testimony about it or in support of any damage amount.65 Sherman and, by extension, Stillwater Capital admitted that they have no knowledge that Plaintiffs sent the wrong FPF Promote Amount intentionally.66 Sherman admitted that when Defendants received the Initial FPF Promote Amount in 2017, they did not take any actions in detrimental reliance on the amount provided and therefore have no damages.67 Sherman further testified that, after learning of the Correct FPF Promote Amount in August 2023, Defendants took no action in detrimental reliance of that amount and have no damages as a result of learning it;68 o. Unjust Enrichment - Testified he did not know the amount of damages it suffered as a result of the alleged unjust enrichment and 60 Id. at 36:19-37:8, 52:18-53:18. 61 Id. at 38:1-3. 62 Exhibit F, SWCM Tr.at 17:20-23. 63 Exhibit D, SWC Tr. at 43:20-25. 44:7-45:4. 64 Id. at 45:16-49:12. 65 Exhibit F, SWCM Tr.at 17:24-18:1. 66 Exhibit D, SWC Tr. at 41:13-42:3. 67 Id. at 43:20-23, 44:7-45:4. 68 Id. at 45:16-49:12. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 16 was unable to provide testimony about it or in support of any damage amount;69 p. Quantum Meruit – Testified that he does not know the amount of damages it suffered as a result of the alleged quantum meruit and was unable to provide testimony about it or in support of any damage amount;70 q. Money Had and Received – Testified that he does not know the amount of damages it suffered as a result of the alleged money had and received and was unable to provide testimony about it or in support of any damage amount.71 14. On December 5, Defendants’ expert witness, Andrew Walther, was deposed.72 Walther testified he had not calculated any damages and did not intend to offer any opinions about Defendants’ alleged counterclaim damages.73 He also is not offering any opinions as to the causation elements of Defendants’ counterclaims.74 Walther has never even seen Defendants’ September 8, 2023 Amended Affirmative Defenses and therefore cannot offer any testimony in support of them.75 Beyond that, he has no testimony to support Defendants’ previously filed September 1, 2023 affirmative defenses either.76 IV. BASIS FOR SUMMARY JUDGMENT Plaintiffs are entitled to judgment as a matter of law because an adequate time for discovery has passed, and Defendants have testified that they have no evidence, and cannot 69 Exhibit F, SWCM Tr. at 18:2-4. 70 Id. at 18:5-7. 71 Id. at 18:8-10. 72 See generally Exhibit G, Excerpts of Walther Tr. 73 Exhibit G, Walther Tr. at 140:12-16. 74 Id. at 140:17-22. 75 Id. at 140:23-141:15. 76 Id. at 141:10-24. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 17 present any evidence, of one or more elements of each of their counterclaims or their affirmative defenses. Specifically, Defendants have not produced, and admitted they cannot provide, any evidence of causation, damages, falsity, reliance, or materiality. V. LEGAL STANDARD After adequate time for discovery, a defendant is entitled to summary judgment if the plaintiff failed to produce evidence on one or more of the essential elements of a claim for which the plaintiff bears the burden of proof. TEX. R. CIV. P. 166a(i). Under the “no evidence” summary judgment standard, the party with the burden at trial will have the same burden of proof in a summary judgment proceeding. See id.; Reid v. Compass Group USA, Inc., 172 S.W.3d 203, 205 (Tex. App.—El Paso 2005, no pet.). Once a defendant moves for no evidence summary judgment, the plaintiff must produce more than a scintilla of probative evidence raising a genuine issue of material fact to defeat the motion. See TEX. R. CIV. P. 166a(i); Reid, 172 S.W.3d at 205; Harrill v. A.J’s. Wrecker Serv., 27 S.W.3d 191, 193 (Tex. App.—Dallas 2000, dism’d w.o.j.). The party opposing a no evidence motion for summary judgment may not rest upon the allegations of its pleadings; the party must present evidence that raises a fact issue on the challenged elements. See King v. Texas Dep’t of Human Servs., 28 S.W.3d 27, 34 (Tex. App.— Austin 2000, no pet.). The non-movant must come forward with admissible evidence that creates a genuine issue of fact as to all the essential elements of his claims upon which he will bear the burden of proof at trial. Frazier v. Khai Loong Yu, 987 S.W.2d 607 (Tex. App.—Fort Worth 1999, pet. denied). The court must grant the motion unless the respondent produces summary PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 18 judgment evidence raising a genuine issue of material fact. TEX. R. CIV. P. 166a(i); Western Invs., Inc. v. Urena, 162 S.W.3d 547, 550 (Tex. 2005). VI. ARGUMENT AND AUTHORITIES A. ALL OF DEFENDANTS’ COUNTERCLAIMS ARE TIME BARRED BY THE APPLICABLE STATUTES OF LIMITATIONS. Plaintiffs incorporate all prior paragraphs, including those in the statement of facts as if set forth fully herein. There is a four-year statute of limitations for the declaratory judgment, breach of contract, quantum meruit, fraud, unjust enrichment, and money had and received counterclaims. Tex Civ. Prac. Rem. Code § 16.004, § 16.051. Negligent misrepresentation is governed by the two-year statute of limitations. Id. at § 16.003. Each cause of action accrues on the date of injury. All of the counterclaims other than declaratory relief are based upon Plaintiffs’ August 24, 2017, letter to Defendants that inadvertently provided the incorrect Initial FPF Promote Amount.77 And Defendants’ counterclaim for declaratory relief is based on the language of the Settlement Agreement, which was executed on August 26, 2015. Robert Aaron Sherman, Defendants’ corporate representative, who is also the only person with any personal knowledge, admitted that (1) he received Leeds’s communication on or about August 24, 2017, that stated what the Promote amount was, (2) he knew that it was more than ten days after the closing date of the Forest Park Flats sale which he alleges is a breach of the settlement agreement, and (3) he did nothing to investigate his claim or how much the correct promote amount actually was.78 The other Defendants testified they had no knowledge of, and 77 Exhibit R, Leeds Initial FPF Promote Letter (PLTF LEEDS 000951). 78 Exhibit F, SWCM Tr. at 34:22-35:19; Exhibit D, SWC Tr. at 32:23-33:3, 43:20-44:1. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 19 could not provide any testimony about, their counterclaims, so they cannot refute Sherman’s testimony.79 Accordingly, there is no genuine issue of material fact that the claims accrued on or about August 24, 2017, at the latest, when Defendants were informed of the Initial FPF Promote Amount that Defendants alleged caused their injuries, and which is more than six years before the counterclaims were filed. Therefore, it is undisputed that all counterclaim causes of action accrued more than four years prior to the counterclaims being filed. Accordingly, all of the counterclaims are time barred. B. PLAINTIFFS ARE ENTITLED TO SUMMARY JUDGMENT ON DEFENDANTS’ DECLARATORY JUDGMENT CLAIM BECAUSE DEFENDANTS’ OWN PLEADINGS AND DISCLOSURES CONCLUSIVELY ESTABLISH THAT THERE IS NO GENUINE ISSUE OF MATERIAL FACT. Plaintiffs incorporate all prior paragraphs, including those in the statement of facts as if set forth fully herein. Defendants’ Declaratory Judgment claim (“Defendants’ Dec. Action”) literally mirrors Plaintiffs’ Declaratory Judgment claim (“Plaintiffs’ Dec. Action”), concedes the factual basis on which Plaintiffs’ Dec. Action is based, concedes that Plaintiffs’ Dec. Action is just and that no dispute exists, and asks the Court to render the same judgment. For comparison: Defendants’ First Amended Answer, 80 Plaintiffs’ Third Amended Petition Affirmative and Other Defenses and Counterclaims81 68. Therefore, Plaintiff seeks a declaratory 44. Therefore, Defendants seek a declaratory judgment, granting its requested declaratory relief judgment, granting its requested declaratory that it owes nothing out of pocket other than as relief that Plaintiffs owe nothing out of pocket 79 Exhibit A, Coady Tr. at 22:10-23:6, 48:13-19, 48:25-49:3; Exhibit B, Elliott Tr. at 23:19-24:14, 22:22-23:16, 36:4-10. 80 Exhibit Z, Plaintiffs’ Third Amended Petition at ¶ 68. 81 Exhibit H, Defendants’ First Amended Answer and Counterclaims at ¶ 44. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 20 an offset to whatever Leeds is entitled to under other than as a reduction to whatever Plaintiffs the balance of the agreement. may be entitled to under the balance of the agreement. They seek identical relief—which is a declaration that Plaintiffs owe nothing out of pocket—thus, there is no disagreement or issue for any fact finder to decide. Further, Defendants’ Amended Initial Disclosures contain a copied and pasted version of the counterclaims and admit the same.82 Plaintiffs repeatedly attempted to confer with Defendants to discuss the lack of any genuine issue and to obtain an agreed partial judgment to avoid wasting cost and judicial resources. But, as has become typical in this case, Defendants repeatedly refused to respond and then finally responded with an incomprehensible, rambling statement about unrelated issues.83 The true purpose behind Defendants’ pleading can be found in paragraph 45 of the counterclaim: “Defendants seek their attorneys’ fees with respect to this Count A per the declaratory judgment statute.”84 Defendants’ bad faith pleading makes a mockery of this Court, and Defendants’ counsel should be sanctioned, again, for the fourth time in this case.85 Accordingly, this Court should render summary judgment against Defendants’ declaratory judgment action and grant summary judgment as to Plaintiffs’ declaratory judgment action that has been on file for almost three years. 82 Exhibit J, Defendants’ Amended Initial Disclosures at ¶¶ 42-44. 83 See Exhibit S, November 2, 2023, email chain between counsel regarding Agreed Partial Judgment; Exhibit T, Proposed Agreed Partial Judgment. 84 Exhibit H, Defendants’ First Amended Answer and Counterclaims at ¶ 45. 85 Exhibits U through X, Orders sanctioning Defendants’ counsel for discovery misconduct. PLAINTIFFS’ TRADITIONAL MOTION FOR SUMMARY JUDGMENT ON DEFENDANTS’ COUNTERCLAIMS AND AFFIRMATIVE DEFENSES PAGE 21 C. DEFENDANTS’ CLAIMS FAIL AS A MATTER OF LAW BECAUSE DEFENDANT