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Sinclair and Associates of Greenville LLC v. Crescom Bank

United States District Court, D. South Carolina, Charleston Division

January 2, 2018

SINCLAIR AND ASSOCIATES OF GREENVILLE, LLC, Plaintiff,
v.
CRESCOM BANK, ANTLER ROAD, LLC, CRESCENT HOMES SC, LLC, PARK INVESTORS, LLC, JAMIN HUJIK, EDWARD M. TERRY, and ROBERT E. SAMPLE, Defendants.

          ORDER

          DAVID C. NORTON UNITED STATES DISTRICT JUDGE.

         This matter is before the court on defendants Antler Road LLC, Crescent Homes SC, LLC, Park Investors, LLC, and Edward M. Terry's (“defendants”) motion for partial summary judgment, ECF No. 84, motion in limine, ECF No. 98, and motion to bifurcate, ECF No. 104; defendants Antler Road LLC, Park Investors, LLC, and Edward M. Terry's (“Baker Plantation defendants”) motion for summary judgment, ECF No. 101; defendant Crescent Homes SC, LLC's (“Crescent Homes”) motion for summary judgment, ECF No. 103; and plaintiff Sinclair and Associates of Greenville, LLC's (“Sinclair”) motion for sanctions, ECF No. 117. For the reasons stated below, the court denies defendants' motion for partial summary judgment, motion in limine, and motion to bifurcate. Further, it denies Baker Plantation defendants' motion for summary judgment, denies Crescent Homes's motion for summary judgment, and grants Sinclair's motion for sanctions.

         I. BACKGROUND[1]

         Sinclair is a design firm engaged in the business of providing engineering, land surveying, and project management services, with particular expertise in the area of pool design and engineering. Compl. ¶¶ 5, 7. In or around 2004, Sinclair contracted with Summerville Homes, LLC (“Summerville Homes”), the then-owner of the Baker Plantation subdivision in North Charleston, South Carolina, to prepare civil engineering and architectural plans and technical drawings for a pool and amenities center at Baker Plantation (the “Works”). Id. ¶¶ 31, 32. Sinclair then prepared and sealed the Works, and licensed the Works to Summerville Homes. Id. ¶¶ 33, 40. According to Sinclair, this license granted a non-transferable, limited right to use the Works in connection with Summerville Homes's construction of the amenities center and pool at Baker Plantation. Id. ¶¶ 39-41. However, Sinclair never sold the Works or any interest therein to any party. Id. ¶ 39.

         Summerville Homes never began construction on the pool and amenities center, but instead, conveyed the Baker Plantation property to defendant CresCom Bank (“CresCom”) via a deed in lieu of foreclosure. Id. ¶¶ 47, 48. Around the time of this transaction, CresCom somehow obtained a copy of the Works.[2] Id. ¶ 49. CresCom subsequently conveyed the Baker Plantation property and the Works to defendant Antler Road, LLC (“Antler Road”). Id. ¶¶ 57, 58, 61. In December 2011, defendant Jamin Hujik (“Hujik”), the vice president of CresCom, and Edward M. Terry (“Terry”), the manager of Antler Road and president of Crescent Homes SC, LLC (“Crescent Homes”), each asked Sinclair whether it would be willing to release its copyrights in the Works. Id. ¶¶ 12, 14, 64-67, 76-79. Sinclair maintains that on both occasions it stated that it would be willing to do so in exchange for payment, but none of the defendants ever accepted this offer. Id. ¶¶ 65, 77-79. In fact, Terry personally rejected the offer on December 29, 2011, stating that the Works were not worth the amount Sinclair requested. Id. ¶ 79.

         According to Sinclair, Antler Road subsequently used the Works to construct the pool and amenities center at Baker Plantation despite never having paid for the Works. Id. ¶¶ 81, 82. After purchasing the Baker Plantation property from Antler Road, Crescent Homes also used the Works in this manner. Id. ¶¶ 83, 84, 91. At some point, either Antler Road or Crescent Homes provided defendants Park Investors, LLC (“Park Investors”) and Robert E. Sample (“Sample”) with copies of certain portions of the Works, which Park Investors used to construct the amenities center and Sample used to create derivative plans for the pool. Id. ¶¶ 95-110. Sample's derivative plans were later used to obtain a construction permit for the pool from the South Carolina Department of Health and Environmental Control (“DHEC”). Id. ¶ 112. Sinclair claims that at all times relevant to this action, the various defendants were aware that either Antler Road or Crescent Homes planned to use the Works in this manner and that neither Antler Road nor Crescent Homes had the right to so use the Works. Id. ¶¶ 62, 68-76, 80, 85, 90, 91, 99-101, 106-109. Crescent Homes now markets the Baker Plantation subdivision using the pool and amenities center, id. ¶ 117, and all defendants have profited from their use or conveyance of the Works, id. ¶ 118.

         On February 17, 2016, Sinclair filed the instant action bringing claims for direct copyright infringement, contributory copyright infringement, conversion, and violation of the South Carolina Unfair Trade Practices Act, SC Code §§ 39-5-10, et seq. (“SCUTPA”). On November 17, 2016, the court dismissed Sinclair's claims for violation of SCUTPA, leaving only its state law conversion claim and its federal claims under the Copyright Act. On June 2, 2017, defendants filed a motion for partial summary judgment, ECF No. 84, to which Sinclair responded on June 16, 2017, ECF No. 92. On June 30, 2017, defendants filed a motion in limine, ECF No. 98, to which Sinclair responded on July 14, 2017. On August 1, 2017, the Baker Plantation defendants filed a motion for summary judgment, ECF No. 101, to which Sinclair responded on August 15, 2017, ECF No. 109. On August 1, 2017, defendant Crescent Homes filed a motion for summary judgment, ECF No. 103, to which Sinclair responded on August 15, 2017, ECF No. 110. On August 1, 2017, defendants filed an amended motion to bifurcate, ECF No. 104, to which Sinclair responded on August 15, 2017, ECF No. 111. On September 22, 2017, Sinclair filed a motion for sanctions, ECF No. 117, to which Terry responded on October 6, 2017, ECF No. 121, and Sinclair replied on October 13, 2017, ECF No. 122. The motions have been fully briefed and are now ripe for the court's review.

         II. STANDARDS

         A. Motion for Summary Judgment

         Summary judgment shall be granted “if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). Rule 56(c) of the Federal Rules of Civil Procedure requires that the district court enter judgment against a party who, ‘after adequate time for discovery . . . fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.'” Stone v. Liberty Mut. Ins. Co., 105 F.3d 188, 190 (4th Cir. 1997) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)). “By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). “Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Id. at 248. “[S]ummary judgment will not lie if the dispute about a material fact is ‘genuine, ' that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id.

         “[A]t the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Id. at 249. When the party moving for summary judgment does not bear the ultimate burden of persuasion at trial, it may discharge its burden by demonstrating to the court that there is an absence of evidence to support the non-moving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). The non-movant must then “make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.” Id. at 322.

         Any reasonable inferences are to be drawn in favor of the nonmoving party. Anderson, 477 U.S. at 255, Webster v. U.S. Dep't of Agric., 685 F.3d 411, 421 (4th Cir. 2012). However, to defeat summary judgment, the nonmoving party must rely on more than conclusory allegations, mere speculation, the building of one inference upon another, or the mere existence of a scintilla of evidence. See Anderson, 477 U.S. at 252; Stone, 105 F.3d at 191. Rather, “a party opposing a properly supported motion for summary judgment . . . must ‘set forth specific facts showing that there is a genuine issue for trial.'” Bouchat, 346 F.3d at 522 (quoting Fed.R.Civ.P. 56(e) (2002) (amended 2010)). If the adverse party fails to provide evidence establishing that the fact-finder could reasonably decide in his favor, then summary judgment shall be entered “regardless of ‘[a]ny proof or evidentiary requirements imposed by the substantive law.'” Id. (quoting Anderson, 477 U.S. at 248).

         B. Motion in Limine

         The purpose of a motion in limine is to obtain a preliminary ruling on the admissibility of a particular evidentiary matter. Luce v. United States, 469 U.S. 38, 40 n.2 (1984). A court will exclude evidence on a motion in limine only if the evidence is “clearly inadmissible for any purpose.” Hall v. Sterling Park Dist., 2012 WL 1050302, at *2 (N.D. Ill. Mar. 28, 2012).

         C. Motion for Sanctions

         Federal Rule of Civil Procedure 37(b)(2) provides that “[i]f a party or a party's officer, director, or managing agent - or a witness designated under Rule 30(b)(6) or 31(a)(4) - fails to obey an order to provide or permit discovery, including an order under Rule 26(f), 35, or 37(a), the court where the action is pending may issue further just orders.” Such orders may include:

(i) directing that the matters embraced in the order or other designated facts be taken as established for purposes of the action, as the prevailing party claims;
(ii) prohibiting the disobedient party from supporting or opposing designated claims or defenses, or from introducing designated matters in evidence;
(iii) striking pleadings in whole or in part;
(iv) staying further proceedings until the order is obeyed;
(v) dismissing the action or proceeding in whole or in part;
(vi) rendering a default judgment against the disobedient party; or
(vii) treating as contempt of court the failure to obey any order except an order to submit to a physical or ...

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