Ames Construction, Inc. v. Clark County

1 UNITED STATES DISTRICT COURT

2 DISTRICT OF NEVADA

3 * * *

4 AMES CONSTRUCTION, INC., a Minnesota Case No. 2:18-cv-00299-JCM-EJY corporation, 5 Plaintiff, ORDER 6 v. 7 CLARK COUNTY, a political subdivision of 8 the State of Nevada; and CLARK COUNTY DEPARTMENT OF PUBLIC WORKS; DOES 9 I through X; and ROE CORPORATIONS I through X, 10 Defendants. 11 12 Before the Court is Defendants’ Motion for Protective Order. ECF No. 48 (“Defs.’ Mot.”). 13 The Court has also considered Plaintiff’s Response to Clark County’s and Clark County Department 14 of Public Works’ Motion for Protective Order (ECF No. 54, or “Pl.’s Response”) and Defendants’ 15 Reply in Support of Motion for Protective Order (ECF No. 57, or “Defs.’ Reply”). The Court finds 16 as follows. 17 I. BACKGROUND 18 This case concerns a public works contract for construction of a portion of the “Wash,” a 19 flood channel feeding part of the Las Vegas Valley’s excess water into Lake Mead, which the Court 20 refers to as the “Ames Project.” The Ames Project is part of a larger Construction Manager at Risk 21 contract (the “CMAR Project”) entered into between the Las Vegas Paving Corporation (“LVP”) 22 and Defendant Clark County. ECF No. 3 (“Compl.”) 28. Because LVP and Clark County could 23 not agree on a price for the last portion of the CMAR Project, the County put that portion up for 24 competitive bid. Compl. 8. 25 Plaintiff Ames Construction, Inc. (“Ames”) bid on the last portion of the CMAR Project and 26 was awarded the contract. Compl. 13, 15. Plaintiff alleges that unforeseen “severe water flow 27 events” impacted its ability to timely finish the Ames Project and that it notified Defendant Clark 1 County of these issues. Compl. 51–52. Ames also claims that the water flow events caused it to 2 incur more than $14,000,000 in losses for which Clark County has denied reimbursement. Id. 53. 3 On February 16, 2018, Plaintiff filed its Complaint alleging (1) breach of contract; (2) breach 4 of implied warranty; (3) breach of implied covenant of good faith and fair dealing; (4) unjust 5 enrichment; (5) failure to comply with NRS 338.1435; (6) negligent misrepresentation; (7) cardinal 6 change; and (8) impossibility/impracticability of performance. Id. 63–143. 7 Discovery commenced in this case on April 3, 2018, following the parties’ Fed. R. Civ. P. 8 26(f) conference. ECF No. 11. On October 10, 2019, Ames notified Defendants that it sought to 9 take the deposition of Clark Co u nty Commissioner Larry Brown, who sat as the Chairman of the 10 Clark County Regional Flood Control District (“CCRFCD”) during the CMAR Project and the flood 11 events which impacted the work performed by both LVP and Ames. ECF No. 48-3 at 1–4 (“Ex. 112 A”). The same day, Ames amended its deposition notice to include Commissioner Brown’s official 13 title. Id. at 5–8 (“Ex. 1-B”). Plaintiff represents that it intends to inquire about the following topics:

14 • The Commission’s Decision to initially award the contract on a CMAR basis as opposed to the design/build methodology; 15 • The selection process of the CMAR; 16 • Whether the Commission was advised that Phase I of the Project exceeded the 17 Engineer’s Estimate;

18 • What information, if any, the Commission was provided in deciding to reject LVP’s CMAR proposal and put the Project out for competitive bids; 19 • The County’s efforts to comply with NRS 338.1435 in performing a 20 Constructability Review of the plans and specifications before awarding the Project to Ames; 21 • The estimates prepared by the County’s consultants [and] provided to the 22 CCRFCD and County Commissioners relating to the Project;

23 • [Whether] the Commission ha[d] budget concerns regarding LV Paving’s proposal; and[,] 24 • Commissioner Brown’s role as the Chairman of the CCRFCD and the extent 25 and scope of the Project in relation to upstream projects contemplated by the CCRFCD[.] 26 27 1 Pl.’s Response at 5–6. More generally, “Ames seeks to depose . . . Commissioner [Brown] to find 2 out why the Commission decided not to proceed with the LVP CMAR,” and to understanding the 3 information the Commission “considered” in making this decision. Id. at 12. 4 Defendants note that Ames deposed a variety of party representatives and experts including 5 the General Manager of CCRFCD and various County engineers from the Department of Public 6 Works. ECF No. 48-1 (“Lenhard Decl.”) 8–9. Defendants state that “[d]uring one of these 7 depositions, counsel for the County raised an issue with respect to Commissioner Brown’s 8 deposition – namely, that most, if not all, of the information known by him with respect to the CMAR 9 Project and the [Ames] Project would be protected by the deliberative process privilege.” Defs.’ 10 Mot. at 4–5 (internal citation omitted). 11 Ames amended its deposition notice a second time and rescheduled Commissioner Brown’s 12 deposition for November 14, 2019. ECF No. 48-3 at 9–16 (“Ex. 1-C” and “Ex. 1-D”). Counsel for 13 the respective parties were unable to reach an agreement on whether Commissioner Brown’s 14 deposition should go forward before this time, despite holding a telephonic meet-and-confer 15 (Lenhard Decl. 22–24) and communicating through several email exchanges (ECF No. 48-3 at 17– 16 19 (“Ex. 1-E”)).1 Accordingly, the instant Motion and accompanying briefings followed. 17 II. DISCUSSION 18 Fed. R. Civ. P. 26(b)(1) states that:

19 Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, considering 20 the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the 21 importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within 22 this scope of discovery need not be admissible in evidence to be discoverable.

23 24

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1 In a November 1, 2019 email, Defendants wrote to Plaintiff stating that he had “conferred with Commissioner 26 Brown . . . concerning the depo notice. [Commissioner Brown] has no recall of [the CMAR] project or the underlying votes approving the 2 contracts. All he can do is verify his vote which is public record.” Ex. 1-E. Plaintiff replied a 27 week later expressing his belief that he is “entitled to present documents to [Commissioner Brown] to refresh his 1 Further, Fed. R. Civ. P. 26(b)(2)(C) requires a court to:

2 limit the frequency or extent of discovery otherwise allowed by these rules or by local rule if it determines that: 3 (i) the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less 4 expensive; (ii) the party seeking discovery has had ample opportunity to obtain the information 5 by discovery in the action; or (iii) the proposed discovery is outside the scope permitted by Rule 26(b)(1). 6 7 In accordance with these directives, courts are empowered to enter a protective order “protect[ing] 8 party or person from annoyance, embarrassment, oppression, or undue burden or expense, including 9 . . . forbidding inquiry into certain matters, or limiting the scope of disclosure or discovery to certain 10 matters[.]” Fed. R. Civ. P. 26(c)(1)(D). 11 Defendants argue that a protective order barring Commissioner Brown’s deposition is 12 appropriate because the sought information is protected by the deliberative process privilege and the 13 legislative privilege. Defs.’ Mot. at 7. Because the Court finds that Commissioner Brown’s 14 deposition should not go forward on the basis of the deliberative process privilege, it declines to 15 reach Defendants’ alternative legislative privilege argument. 16 1. The deliberative process privilege may apply to deposition testimony. 17 As stated above, the Federal Rules of Civil Procedure precludes discovery of privileged 18 information. Fed. R. Civ. P. 26(b)(1). Here, Defendants claim Commissioner Brown’s planned 19 deposition falls within the deliberative process privilege and, therefore, a protective order barring 20 his deposition is appropriate. Defs.’ Mot. at 8–9. 21 The deliberative process privilege “permits the government to withhold documents that 22 reflect advisory opinions, recommendations and deliberations comprising part of a process by which 23 government decisions and policies are formulated.” F.T.C. v. Warner Commc’ns Inc., 742 F.2d 24 1156, 1161 (9th Cir. 1984), citing N. L. R. B. v. Sears, Roebuck & Co., 421 U.S. 132, 150 (1975). 25 The privilege was “developed to promote frank and independent discussion among those responsible 26 for making governmental decisions, . . . and also to protect against premature disclosure of proposed 27 agency policies or decisions. . . . The ultimate purpose of the privilege is to protect the quality of 1 As a preliminary matter, Ames asserts that the deliberative process only “applies to instances 2 where a party seeks disclosure of documents from a government body—it does not apply when a 3 party seeks to take the deposition of a government official to ask him or her questions about factual 4 matters or documents already disclosed.” Pl.’s Response at 7 (emphases added). To the contrary, 5 this district court has applied the deliberative process privilege to deposition testimony. E.E.O.C. v. 6 Gold River Operating Corp., No. 2:04-cv-01349-LRL, 2007 WL 983853, at (D. Nev. Mar. 30, 7 2007) (“There is no question that the [deposition] questions relate to the [plaintiff’s] deliberations. 8 . . . Thus, the [deliberative process] privilege applies.”), citing North Pacifica, LLC v. City of 9 Pacifica, 274 F. Supp. 2d 1118, 1121 n.1 (N.D. Cal. 2003) (providing that the deliberative process 10 privilege applies to deposition testimony as well as written documents) (citations omitted). In yet 11 another case from this district, the court “acknowledged [that] the [deliberative process privilege] 12 could apply to deposition testimony[.]” Defs.’ Reply at 4, citing Giezie v. Valley Health Syst., LLC, 13 No. 2:12-cv-00036-ECR-GWF, 2012 WL 3929446, at (D. Nev. Sept. 7, 2012). In any event, as 14 Defendants convincingly point out, “if only documents are protected [by the deliberative process 15 privilege], oral communications discussing the contents of those documents would be subject to 16 disclosure.” Id. Such a conclusion is illogical, provided that the goal of the deliberative process 17 privilege is to encourage candid discussions of ideas and to improve the government decision18 making process. Warner Commc’ns Inc., 742 F.2d at 1161. For these reasons, Plaintiff’s contention 19 that the deliberative process privilege only applies to documents is unpersuasive. The Court 20 therefore finds that the deliberative process privilege may apply to prospective deposition testimony.

21 2. The deliberative process privilege applies to Commissioner Brown’s planned deposition. 22 23 To be protected under the deliberative process privilege, the sought information must be both 24 (1) predecisional, which means that it was “generated before the adoption of an agency’s policy or 25 decision,” and (2) “deliberative in nature, containing opinions, recommendations, or advice about 26 agency policies. . . . Purely factual material that does not reflect deliberative processes is not 27 protected.” Id. (internal citations omitted). To establish that sought information is “predecisional,” 1 . . . To qualify as part of [the] ‘deliberative’ process, the materials requested must consist of opinions, 2 recommendations, or advice about agency policies [or decisions].” DR Partners v. Bd. of Cnty. 3 Com’rs of Clark Cnty., 6 P.3d 465, 469 (Nev. 2000) (internal citation omitted). In the second part 4 of this analysis, the Court must consider whether the sought “factual material is so interwoven with 5 the deliberative material that it is not severable.” United States v. Fernandez, 231 F.3d 1240, 1247 6 (9th Cir. 2000) (internal citation omitted). “The [government] agency bears the burden of 7 establishing, with particularity, the character of the decision, the deliberative process involved, and 8 the role played by the [sought information] in the course of that process.” Clark Cnty. School Dist. 9 v. Las Vegas Review-Journal, 429 P.3d 313, 318 (Nev. 2018) (internal citations and quotation marks 10 omitted). 11 Here, Defendants contend that Commissioner Brown’s deposition should be barred because:

12 the sought information is . . . predecisional, as it is calculated to determine the basis for and discussions surrounding the County’s decision to put Ames’ portion of the 13 Wash out for competitive bid instead of continuing with construction under a CMAR arrangement. In addition, it is deliberative because Ames seeks to 14 determine the opinions of high-ranking County personnel, including Commissioner Brown, as to that decision. Ames also apparently seeks to determine what 15 recommendations or advice were given regarding that decision – all of which are deliberative in nature. 16 17 Defs.’ Mot. at 9. 18 The Court agrees. The information sought is predecisional because it was generated in 19 anticipation of Clark County’s decision to open the contested portion of the Wash for competitive 20 bid, and to eventually award the Ames Project to Ames. As previously stated, “[u]nder the 21 [deliberative] privilege, governmental entities may conceal public records only if the entity can 22 prove that the relevant public records were part of a predecisional and deliberative process that led 23 to a specific decision or policy.” Clark Cnty. School. Dist., 429 P.3d at 318 (internal citations 24 omitted) (emphasis added). Although Ames disputes whether Commissioner Brown’s 25 determinations regarding the Ames Project amounted to an “important agency policy,” that debate 26 is inconsequential to our conclusion today. Pl.’s Response at 12 (emphasis added). At this juncture, 27 the County was required to identify a decision or policy to which the sought information contributed, 1 which it has done. DR Partners, 6 P.3d at 469. Ames concedes that the County arrived at a “decision 2 to reject LVP’s CMAR and put the Ames’ Project out for competitive bid.” Pl.’s Response at 12 3 (emphasis added). 4 The information sought is also deliberative. In contrast, Plaintiff maintains that all of the 5 topics about which it seeks to question Commissioner Brown are purely factual and, therefore, 6 unprotected by the deliberative process privilege. Pl.’s Response at 9–10. Plaintiff’s 7 characterization is unpersuasive because Ames seeks factual information that is inextricably 8 intertwined with Clark County’s policy decisions. Fernandez, 231 F.3d at 1247 (internal citation 9 omitted). As listed below, the topics Plaintiff seeks to depose Commissioner Brown about are 10 unseverable from the deliberative process underlying Clark County’s decision in this matter:

11 1. The Commission’s decision to initially award the contract on a CMAR basis as opposed to the design/build methodology; 12 2. The selection process of the CMAR; 13 3. Whether the Commission was advised that Phase I of the Project exceeded 14 the Engineer’s Estimate;

15 4. What information, if any, the Commission was provided in deciding to reject LVP’s CMAR proposal and put the Project out for competitive bids; 16 5. The County's efforts to comply with NRS 338.1435 in performing a 17 Constructability Review of the plans and specifications before awarding the Project to Ames; 18 6. Estimates related to the Project that the County's consultants prepared and 19 provided to the CCRFCD and County Commissioners;

20 7. Whether the Commission had budget concerns regarding LVP’s proposal; and, 21 8. Commissioner Brown's role as the Chairman of the CCRFCD and the extent 22 and scope of the Project in relation to upstream projects contemplated by the CCRFCD. 23 24 First, the Court agrees that “[i]tems 1 and 7 . . . are not facts at all; rather they are questions aimed 25 at determining mental processes and . . . are clearly protected by the [deliberative process] privilege.” 26 Defs.’ Reply at 6. Second, all of the remaining facts Plaintiff is seeking in the above topics “relate 27 to two decisions of the Commission: (1) initially awarding a CMAR to LVP instead of using 1 was eventually awarded to Ames.” Id. Even Ames admits that it is seeking to depose Commissioner 2 Brown to ascertain “why the Commission decided not to proceed with the LVP CMAR and put the 3 Project out for bid[, as well as to determine] . . . the information provided to . . . and considered by 4 [the Commission].” Pl.’s Response at 12 (emphases added). “In other words, . . . the unveiling of 5 [these] factual materials would be tantamount to the publication of the evaluation and analysis of the 6 multitudinous facts conducted by the agency, [and therefore,] the deliberative process privilege 7 applies.” Nat’l Wildlife Federation v. U.S. Forest Serv., 861 F.2d 1114, 1119 (9th Cir. 1988) 8 (internal citation and quotation marks omitted). 9 This case is distinguishable from Giezie, where the court permitted a defendant’s deposition 10 to go forward despite non-party U.S. Equal Employment Opportunity Commission’s (“EEOC”) 11 emergency request for a protective order. 2012 WL 3929446. There, the defendant sought to 12 question an EEOC investigator solely about the “factual underpinnings” of his investigation, and 13 “[d]efendant . . . stated that the EEOC may properly assert objections to specific questions during 14 the deposition on the basis of the deliberative process privilege if a question reasonably appears to 15 seek privileged information.” Id. at . At present, apart from Ames’ assertion that it “believes it 16 can complete its questioning of Commissioner Brown in less than 3 hours,” no analogous evidentiary 17 limitations at deposition have been proposed. Pl.’s Response at 15–16. Plaintiff’s suggested time 18 limit does nothing to cure the impermissible content of information about which it seeks to question 19 Commissioner Brown. 20 Notwithstanding the above, Ames insists that the deliberative process privilege does not 21 apply here because the government’s actions are in question. Pl.’s Response at 10–11, citing Clark 22 Cnty. School Dist., 429 P.3d at 318. It may be true, as Plaintiff contends, that if a “cause of action 23 is directed at the government’s intent, . . . it makes no sense to permit the government to use the 24 [deliberative process] privilege as a shield.” In re Subpoena Duces Tecum Served on Office of 25 Comptroller of Currency, 145 F.3d 1422, 1424 (D.C. Cir. 1998). However, the cases to which 26 Plaintiff cites are distinguishable from the present matter. The former case concerns an alleged Title 27 1 VII sexual harassment violation, and the latter involves a fraudulent conveyance claim. See 2 generally Clark Cnty. School Dist., 429 P.3d 313; id. In contrast, none of Ames’ causes of action 3 turn on the County’s intent. 4 The deliberative process privilege applies to the information Plaintiff seeks from 5 Commissioner Brown by way of deposition because Plaintiff seeks to question him on predecisional 6 and deliberative processes and facts that formed the basis of the determination of his actions.

7 3. Plaintiff has not demonstrated the necessity of deposing Commissioner Brown. 8 After “the court determines that [sought information] is privileged, it must still determine 9 whether the [information] should be withheld. . . . [T]he deliberative process privilege is a qualified 10 privilege.” DR Partners, 6 P.3d at 471 (internal citation omitted). Because the deliberative process 11 privilege is a qualified one, the party seeking disclosure may be able to overcome the privilege by 12 showing that its need for the information outweighs the government’s interest in nondisclosure. 13 Warner Commc’ns Inc., 742 F.2d at 1161 (internal citations omitted).

14 The Ninth Circuit in Warner Communications set forth four non-exclusive factors that courts may consider in determining whether the litigant has met this 15 requirement: “(1) the relevance of the evidence; (2) the availability of other evidence; (3) the government's role in the litigation; and (4) the extent to which 16 disclosure would hinder frank and independent discussion regarding contemplated policies and decisions.” Id. “Other factors that a court may consider include: (5) 17 the interest of the litigant, and ultimately society, in accurate judicial fact finding, (6) the seriousness of the litigation and the issues involved, (7) the presence of 18 issues concerning alleged governmental misconduct, and (8) the federal interest in the enforcement of federal law.” N. Pacifica, LLC v. City of Pacifica, 274 F. Supp. 19 2d 1118, 1122 (N.D. Cal. 2003). 20 U.S. Equal Emp’t Opp. Comm’n v. Chipotle Mexican Grill, Inc., Case No. 17-cv-05382-BLF, 2019 21 WL 3811890, at (N.D. Cal. Aug. 1, 2019). 22 Under this multi-factor balancing test, the Court finds that Commissioner Brown’s deposition 23 should not go forward. The sought evidence is relevant, this litigation is serious, and Clark County 24 is a defendant in this matter. However, these factors do not tip the balance in favor of permitting 25 Commissioner Brown’s deposition to proceed. Perhaps, most importantly, forcing the government 26 to disclose its deliberative process in a case such as this might prevent Clark County officials from 27 conducting thorough investigations in anticipation of future public projects. In other words, 1 making process. Moreover, Plaintiff does not allege government misconduct, but, rather, challenges 2 the County’s privileged decision to not proceed with the LVP CMAR and to put the Project out for 3 bid. 4 Finally, the relevant evidence was available to Plaintiff through other channels.2 Discovery 5 has been pending in this matter since April 3, 2018 (ECF No. 11), and Ames and Clark County 6 stipulated to permit each party to take up to twenty depositions (ECF No. 39). Plaintiff nonetheless 7 maintains that Commissioner Brown is “uniquely qualified” to answer questions related to both the 8 Commissioner and CCRFCD. Pl.’s Response at 15. Plaintiff’s contention is belied by the 9 availability of other fact witnesses, some of whom it has already deposed, including CCRFCD’s 10 General Manager and multiple County engineers from the Department of Public Works. Lenhard 11 Decl. 8–9. Further, Ames admits that Commissioner Brown “is one of seven Commissioners” on 12 the Clark County Commission. Pl.’s Response at 14 (emphasis added). Therefore, this Court must 13 limit discovery, in part, because Plaintiff “has had ample opportunity to obtain the information by 14 discovery in the action[.]” Fed. R. Civ. P. 26(b)(2)(C)(ii). In total, Plaintiff has not made a sufficient 15 showing of necessity to overcome the deliberative process privilege. 16 III. CONCLUSION 17 IT IS HEREBY ORDERED that Defendants’ Motion for Protective Order (ECF No. 48) is 18 GRANTED. Plaintiff shall not be permitted to depose Clark County Commissioner Larry Brown 19 for purposes of this action. 20 DATED THIS 6th day of April, 2020.

21

22 ELAYNA J. YOUCHAH 23 UNITED STATES MAGISTRATE JUDGE 24 25 26 27

1 2 3 4 UNITED STATES DISTRICT COURT 5 DISTRICT OF NEVADA 6 * * *

7 AMES CONSTRUCTION, INC., Case No. 2:18-CV-299 JCM (GWF)

8 Plaintiff(s), ORDER

9 v.

10 CLARK COUNTY, et al.,

11 Defendant(s).

12 13 Presently before the court is Clark County and Clark County Department of Works’s 14 (collectively, “the county”) motion for summary judgment. (ECF No. 52). Ames Construction, 15 Inc. (“Ames”) filed a response (ECF No. 62), to which the county replied (ECF No. 64). 16 Also before the court is Ames’s request for oral argument. (ECF No. 66). 17 I. Background 18 The instant action arises from a variety of contractual claims resulting from a private 19 contractor’s performance of a government construction contract. 20 In April 2013, the county issued a request for a construction manager at risk (“CMAR”) 21 to assist in designing and building a flood wash to mitigate flooding issues in the city of Las 22 Vegas. (ECF No. 62 at 4). Ames submitted a proposal in response to this request, in which it 23 identified a flooding risk at the job site. Id. at 5. The county ultimately awarded the CMAR 24 contract to Las Vegas Paving (“LVP”). Id. LVP began constructing the flood wash, but it left 25 the project due to a dispute over cost. Id. at 11. 26 On July 9, 2015, the county issued an invitation to bid for the remainder of the project, 27 which entailed lining the Las Vegas Wash (the “Wash”) from Nellis Boulevard to Stewart 28 Avenue with concrete. (ECF No. 3 at 3). Subsequent amendments to the project included the 1 construction of a pedestrian bridge and trail work. Id. On September 15, 2015, the county 2 awarded Ames the contract for $20,440,260.05. Id. Separate Ames offices prepared the 2013 3 CMAR proposal and the 2015 bid. (ECF No. 62 at 5–6). Neither of the Ames offices knew of 4 the other’s work. Id. 5 The contract contained language indicating the average flow of water through the project 6 site was 9 cubic feet per second (“cfs”). (ECF No. 3 at 4). Pursuant to this clause and others 7 requiring submission of a “dewatering” plan to control potential flooding at the site, Ames 8 submitted a plan allowing the dewatering of flows up to 13 cfs, in excess of the 9 cfs the county 9 indicated as typical. Id at 5. 10 After beginning construction, Ames experienced significant delays due to flooding. Id. 11 at 8. The flow of water was much greater than the 9 cfs indicated in the contract. Id. Ames 12 measured over 10,000 cfs at the worksite, and requested additional time to complete the project 13 after altering plans regarding sequencing, necessary equipment, and repairs. Id.; (ECF No. 62 at 14 16). Ames alleges its damages caused by the delays and necessary repairs are over $14,000,000. 15 (ECF No. 3 at 8). 16 Ames subsequently brought the instant suit alleging a variety of contract claims centered 17 on the contention that the county affirmatively misrepresented the potential for flooding by 18 specifying 9 cfs as the typical flow rate. (See generally ECF No. 3). The county now moves for 19 summary judgment on all claims. (ECF No. 52). 20 II. Legal Standard 21 The Federal Rules of Civil Procedure allow summary judgment when the pleadings, 22 depositions, answers to interrogatories, and admissions on file, together with the affidavits, if 23 any, show that “there is no genuine dispute as to any material fact and the movant is entitled to a 24 judgment as a matter of law.” Fed. R. Civ. P. 56(a). A principal purpose of summary judgment 25 is “to isolate and dispose of factually unsupported claims.” Celotex Corp. v. Catrett, 477 U.S. 26 317, 323–24 (1986). 27 For purposes of summary judgment, disputed factual issues should be construed in favor 28 of the nonmoving party. Lujan v. Nat’l Wildlife Fed., 497 U.S. 871, 888 (1990). However, to 1 withstand summary judgment, the nonmoving party must “set forth specific facts showing that 2 there is a genuine issue for trial.” Id. 3 In determining summary judgment, a court applies a burden-shifting analysis. “When the 4 party moving for summary judgment would bear the burden of proof at trial, it must come 5 forward with evidence which would entitle it to a directed verdict if the evidence went 6 uncontroverted at trial. In such a case, the moving party has the initial burden of establishing the 7 absence of a genuine issue of fact on each issue material to its case.” C.A.R. Transp. Brokerage 8 Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (citations omitted). 9 By contrast, when the nonmoving party bears the burden of proving the claim or defense, 10 the moving party can meet its burden in two ways: (1) by presenting evidence to negate an 11 essential element of the nonmoving party’s case; or (2) by demonstrating that the nonmoving 12 party failed to make a showing sufficient to establish an element essential to that party’s case on 13 which that party will bear the burden of proof at trial. See Celotex Corp., 477 U.S. at 323–24. If 14 the moving party fails to meet its initial burden, summary judgment must be denied and the court 15 need not consider the nonmoving party’s evidence. See Adickes v. S.H. Kress & Co., 398 U.S. 16 144, 159–60 (1970). 17 If the moving party satisfies its initial burden, the burden then shifts to the opposing party 18 to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. Zenith 19 Radio Corp., 475 U.S. 574, 586 (1986). The opposing party need not establish a dispute of 20 material fact conclusively in its favor. See T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 21 809 F.2d 626, 631 (9th Cir. 1987). It is sufficient that “the claimed factual dispute be shown to 22 require a jury or judge to resolve the parties’ differing versions of the truth at trial.” Id. 23 In other words, the nonmoving party cannot avoid summary judgment by relying solely 24 on conclusory allegations that are unsupported by factual data. See Taylor v. List, 880 F.2d 25 1040, 1045 (9th Cir. 1989). Instead, the opposition must go beyond the assertions and 26 allegations of the pleadings and set forth specific facts by producing competent evidence that 27 shows a genuine issue for trial. See Celotex, 477 U.S. at 324. 28 1 At summary judgment, a court’s function is not to weigh the evidence and determine the 2 truth, but to determine whether a genuine dispute exists for trial. See Anderson v. Liberty Lobby, 3 Inc., 477 U.S. 242, 249 (1986). The evidence of the nonmovant is “to be believed, and all 4 justifiable inferences are to be drawn in his favor.” Id. at 255. But if the evidence of the 5 nonmoving party is merely colorable or is not significantly probative, summary judgment may be 6 granted. See id. at 249–50. 7 The Ninth Circuit has held that information contained in an inadmissible form may still 8 be considered for summary judgment if the information itself would be admissible at trial. 9 Fraser v. Goodale, 342 F.3d 1032, 1036 (9th Cir. 2003) (citing Block v. City of Los Angeles, 253 10 F.3d 410, 418–19 (9th Cir. 2001) (“To survive summary judgment, a party does not necessarily 11 have to produce evidence in a form that would be admissible at trial, as long as the party satisfies 12 the requirements of Federal Rules of Civil Procedure 56.”)). 13 III. Discussion 14 As an initial matter, the court has sufficient information to decide the instant motion 15 based on the filings. LR 78-1. Ames’s request for oral argument is denied. (ECF No. 66). 16 A. Damages 17 The county contends that because Ames proceeds under a “total cost” theory of damages, 18 it is precluded from recovery on all of its contractual claims. (ECF No. 52 at 15–18). Ames 19 asserts it satisfies a “modified total cost” calculation. (ECF No. 62 at 18–20). 20 The total cost theory awards the contractor the difference between cost of performance 21 and the bid price. Most jurisdictions disfavor use of total cost damages. See, e.g., Elte, Inc. v. 22 S.S. Mullen, Inc., 469 F.2d 1127, 1131 (9th Cir. 1972); Raytheon Co. v. White, 305 F.3d 1354, 23 1365 (Fed. Cir. 2002). Under Nevada law, to assert a claim for total cost damages, a contractor 24 must prove: “(1) the impracticability of proving actual losses directly; (2) the reasonableness of 25 its bid; (3) the reasonableness of its actual costs; and (4) lack of responsibility for the added 26 costs.” Insulation Contracting & Supply, Inc. v. S3H, Inc., No. 62856, 2015 WL 5774180, at 27 (Nev. Sept. 29, 2015). 28 1 A modified total cost damages calculation uses the same four elements but eases the 2 burden for the contractor. See Raytheon Co., 305 F.3d at 1365. A modified total cost damages 3 calculation awards the contractor the total cost of the contract minus the bid price, with 4 adjustments made for a contractor’s inability to satisfy the four elements, such as excluding costs 5 associated with delays the contractor caused, or adjusting the bid price for miscalculations. See 6 Propellex Corp. v. Brownlee, 342 F.3d 1335, 1339 (Fed. Cir. 2003); Boyajian v. Untied States, 7 423 F.2d 1231, 1240 (Ct. Cl. 1970). 8 The parties dispute both the type of damages requested and whether Ames meets the 9 requirements to recover. (See generally ECF Nos. 52; 62). The county contends that Ames’s 10 calculation does not alter the damages substantially enough to qualify as a modified total 11 damages calculation since it takes no responsibility for any of the delays. (ECF No. 64 at 11– 12 12). There is no formula determining when a claim is sufficiently altered to constitute modified 13 total damages. See Boyajian, 423 F.2d at 1240. Instead, modified total damages are calculated 14 to account for the contractor’s responsibility. See Propellex, 342 F.3d at 1339. 15 Ames does not include a modification assuming responsibility for any of the delay costs 16 because the delays are the heart of this suit. (See generally ECF Nos. 3; 52; 62). All of Ames’s 17 claims are predicated on the county’s responsibility for the delays due to its alleged 18 misrepresentation of flow levels. (See ECF No. 3 at 9–17). Nonetheless, the county now asks 19 the court to force Ames to take responsibility for those delays in its damages calculation, 20 notwithstanding the claims. (ECF No. 52 at 15–17). Here, should Ames prevail on its claims, it 21 would necessarily show that it is not responsible for the delays, thus satisfying the fourth element 22 of total damages. See Insulation Contracting, 2015 WL 5774180, at . For that reason, the 23 court cannot dismiss the claims based on the damages calculation until the claims disputing 24 responsibility have been adjudicated. 25 As to the other elements of damages, there is no real dispute as to the reasonableness of 26 the costs or the initial bid. Further, the evidence construed in the light most favorable to Ames 27 suggests proving damages by any other means might be impracticable. Ames’s damages expert 28 testified that the nature of the available evidence might not lend itself to a more exact 1 calculation. (ECF No. 62 at 19). For those reasons, the court denies summary judgment on the 2 basis of Ames’s damages claim. 3 B. Ames’s Duty to Investigate 4 The county also contends that Ames forfeited its right to bring claims under the bid 5 contract because it failed to satisfy its legal duty to obtain additional rainfall data. (ECF No. 52 6 at 19–21). Ames counters that, under the “superior knowledge” doctrine, the county had a legal 7 duty to disclose information about flooding. (ECF No. 62 at 20–22). 8 The superior knowledge doctrine states a contractor may recover when the owner fails to 9 provide the contractor with pertinent information that results in an increase in costs. Hercules, 10 Inc. v. United States, 24 F.3d 188, 196 (Fed. Cir. 1994). The superior knowledge doctrine 11 applies when: 12 (1) a contractor undertakes to perform without vital knowledge of a fact that affects performance costs or duration; (2) the government 13 was aware the contractor had no knowledge of and had no reason to obtain such information; (3) any contract specification supplied 14 misled the contractor, or did not put it on notice to inquire; and (4) the government failed to provide the relevant information 15 16 Am. Ship Bldg. Co. v. United States, 654 F.2d 75, 79 (Ct. Cl. 1981). 17 The evidence, construed in the light most favorable to Ames, indicates that the county 18 had information it did not disclose. (ECF No. 62 at 13–14). It had knowledge from prior work 19 on the site indicating a higher water flow level that it did not share. Id. While there was 20 disclaimer language, it is not apparent that the term put Ames on notice to inquire further. See 21 John Massman Contracting Co. v. United States, 23 Cl. Ct. 24, 32 (1991) (holding that there 22 must be facts sufficient to put the contractor on notice to the inaccuracy of the owner’s proffered 23 figures); (ECF No. 3 at 4). Because there is a genuine dispute of material fact, the court denies 24 summary judgment based on the superior knowledge doctrine. 25 C. Breach of Contract 26 In its breach of contract claim, Ames first asserts that the county breached by “failing to 27 pay the [c]ontract [p]rice.” (ECF No. 3 at 10). In its motion, the county fails to address this 28 allegation, and Ames never raises the issue again. Accordingly, the court will not grant summary 1 judgment to resolve an issue neither party briefs. Caravel/Woodwind Charters, Inc. v. Tahoe 2 Keys Marina, LLC, 438 F. Supp. 2d 1174, 1180 n. 4 (E.D. Cal. 2006). The county’s failure to 3 pay is an independent basis for a breach of contract claim. (See ECF No. 52 at 22–23). 4 D. Breach of Implied Warranty of Plans and Specifications 5 If a contractor is bound to build a structure in accordance with plans furnished by the 6 owner, there is an implied warranty protecting the adequacy of those plans. United States v. 7 Spearin, 248 U.S. 132, 136–37 (1918). This implied warranty of plans and specifications applies 8 when the owner furnishes plans by which the contractor is to substantially abide, even if the 9 contractor fails to visit the site or investigate the plans. Id. 10 On the other hand, a performance specification—when the owner describes the result it 11 wishes to achieve and defers to the contractor as to the means of reaching that goal—is not 12 subject to this implied warranty. J.L. Simmons Co. v. United States, 188 Ct. Cl. 684, 689 (1969). 13 Thus, an owner provides a performance specification when it gives information without 14 warranting adequacy or accuracy and the contractor maintains discretion over use of that 15 information. John Massman Contracting Co., 23 Cl. Ct. at 33. The warranty does not apply to 16 performance specifications. Id. 17 Here, the county did not provide Ames with any specific plans as to the project. (ECF 18 No. 3 at 4). It did provide an estimation of water flow, but it provided no details as to how to 19 address that flow. Id. It described a result it wished to achieve—a dry construction site—and 20 allowed Ames discretion as to how to achieve that goal. Id. Because there is a performance 21 specification at issue here, the implied warranty of plans and specifications does not apply. The 22 court grants summary judgment for the county as to Ames’s second cause of action. 23 E. Breach of Implied Covenant of Good Faith and Fair Dealing 24 “An implied covenant of good faith and fair dealing exists in every Nevada contract and 25 essentially forbids arbitrary, unfair acts by one party that disadvantage the other.” Frantz v. 26 Johnson, 999 P.2d 351, 358 n.4 (Nev. 2000). 27 With respect to the covenant of good faith and fair dealing, [the Nevada Supreme Court] ha[s] stated that “when one party 28 performs a contract in a manner that is unfaithful to the purpose of the contract and the justified expectations of the other party are 1 thus denied, damages may be awarded against the party who does not act in good faith.” 2 3 Perry v. Jordan, 900 P.2d 335, 338 (Nev. 1995) (quoting Hilton Hotels v. Butch Lewis Prods., 4 808 P.2d 919, 923 (Nev. 1991)) (alteration omitted). 5 To state a claim for breach of the implied covenant of good faith and fair dealing, a party 6 must allege: (1) plaintiff and defendant were parties to a contract; (2) parties owed a duty of 7 good faith to each other; (3) the opposing party breached that duty by performing in a manner 8 that was unfaithful to the purpose of the contract; and (4) the alleging party’s justified 9 expectations were denied as a result. See Hilton Hotels v. Butch Lewis Prods., 808 P.2d 919 10 (Nev. 1991). 11 There is no dispute that Ames and the county were parties to a contract. There is also no 12 dispute that the contract imposed a duty of good faith, as all contracts in Nevada do. See Frantz, 13 999 P.2d at 358 n.4 (Nev. 2000). Ames alleges that it justifiably relied on receiving a 14 construction change authorization (“CCA”) after the county issued CCAs to LVP, and that the 15 county breached by not issuing Ames CCAs for similar requests. (ECF No. 3 at 12). Ames 16 cannot use evidence of the county’s behavior under a separate agreement with a third party to 17 prove a breach of the implied covenant. See Windisch v. Hometown Health Plan, Inc., No. 18 64020, 2015 WL 3649776 at (Nev. June 9, 2015). To the contrary, the breach must be based 19 only on conduct under the contract at issue. See id. Because all of Ames’s allegations are 20 predicated on the county’s past dealings with a third party, the court grants summary judgment to 21 the county on Ames’s third cause of action. 22 F. Unjust Enrichment 23 “The phrase ‘unjust enrichment’ is used in law to characterize the result or effect of a 24 failure to make restitution of, or for, property or benefits received under such circumstances as to 25 give rise to a legal or equitable obligation to account therefor.” 66 Am. Jur. 2d Restitution § 3 26 (1973). A defendant is liable for unjust enrichment when it “has and retains a benefit which in 27 equity and good conscience belongs to another.” Unionamerica Mtg. v. McDonald, 626 P.2d 28 1 1272, 1273 (Nev. 1981). However, a party cannot bring an action for unjust enrichment when a 2 written agreement exists. See Lipshie v. Tracy Inv. Co., 566 P.2d 819, 824 (Nev. 1977). 3 Here, Ames claims that the county was unjustly enriched because it has not paid Ames 4 for the work it performed under the contract. (ECF No. 3 at 13). Because there is a written 5 agreement between Ames and the county regarding work related to the bid, Ames must seek 6 redress under the contract, not under a quasi-contractual claim like unjust enrichment. See 7 Lipshie, 566 P.2d at 824 (Nev. 1977); see also Medical Corp II. V. New Life Centers, LLC., 818 8 F. Supp. 2d 1271, 1276 (D. Nev. 2011; Crockett & Myers, Ltd. v. Napier, Fitzgerald, & Kirby, 9 LLP, 440 F. Supp. 2d 1184, 1197 (D. Nev. 2006); (ECF No. 3). The court grants summary 10 judgment to the county on Ames’s fourth cause of action. 11 G. NRS § 338.1435 12 Ames claims that it was injured by the county’s failure to conduct a constructability 13 review pursuant to Nev. Rev. Stat. § 338.1435. (ECF No. 3 at 13–14). The county contends that 14 the statute does not provide a private right of action and that it performed the review. (ECF No. 15 52 at 29–30). 16 Whether NRS § 338.1345 provides a private right of action appears to be an issue of first 17 impression before this court. Assuming arguendo that a private right of action exists, Ames fails 18 to create a genuine dispute of material fact. The statute does not require any documentary 19 evidence of the review, nor does it require any public record be made of it. See Nev. Rev. Stat. § 20 338.1435. It requires only that the review occur. See id. Ames provides no evidence that the 21 county did not conduct the review. (See ECF No. 3 at 13–14; 62 at 29–30). The court grants 22 summary judgment to the county on Ames’s fifth cause of action. 23 . . . 24 . . . 25 . . . 26 . . . 27 . . . 28 . . . 1 H. Negligent Misrepresentation 2 Liability for negligent misrepresentation attaches to 3 One who, in the course of his business, profession or employment, or in any other action in which he has a pecuniary interest, supplies 4 false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to 5 them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or 6 communicating the information. 7 Halcrow v. Eighth Judicial Dist. Ct., 302 P.3d 1148, 1153 (2013). 8 Here, Ames alleges that the county’s inclusion of the 9 cfs figure in its description of 9 water flow amounted to negligent misrepresentation. (ECF No. 3 at 14–15). The county alleges 10 that because Ames could have found alternate flow data, it is not responsible for its drastic 11 underestimate. (ECF No. 52 at 28–29). 12 The authorities the county cites are distinguishable. See John Massman Contracting Co., 13 23 Cl. Ct. at 32; Walter D. Giertsen Co. v. State, 148 N.W. 2d 741, 743 (Wis. 1967). In one 14 instance, the contractor was explicitly directed to seek additional data beyond what was provided 15 in the contract. John Massman Contracting Co., 23 Cl. Ct. at 32. In the other, there was no 16 affirmative representation of any data, and the contract required an investigation of the 17 “conditions to be encountered.” See Walter D. Giertsen Co. 148 N.W. 2d at 743 (Wis. 1967). 18 Ames would be liable if it had notice that it needed to independently corroborate the 19 figure the county provided. See id.; John Massman Contracting Co., 23 Cl. Ct. at 32. Here, 20 Ames provides evidence that the county had information about flooding that it did not provide 21 Ames. (ECF No. 62 at 13–14). The county provided Ames a figure, and Ames took that figure 22 at face value. Nothing put Ames on notice to inquire any further. Even in a site visit, Ames’s 23 representative testified to only a small stream of water. (ECF No. 52 at 9). There was no way 24 for Ames to know, under the terms of this contract, that there was a risk of severe flooding. The 25 county did. (ECF No. 62 at 13–14.) Ames’s sixth claim survives summary judgment. 26 I. Cardinal Change 27 The cardinal change doctrine is meant to prevent abuse from owners in performance 28 contracts. J.A. Jones Const. Co. v. Lehrer McGovern Bovis, Inc., 89 P.3d 1009, 1020 (Nev. 1 2004). A cardinal change must drastically alter the work agreed to such an extent that “the 2 contractor effectively performs duties that are materially different from those for which the 3 contractor originally bargained.” Id. But “[p]roject delays, out of sequence work, and increased 4 costs fail to amount to a cardinal change.” Armada Concrete, LLC v. Jaynes Corp., No. 2:14-cv5 02176-GMN-GWF, 2017 WL 3567523, at (D. Nev. 2017). 6 Here, there was no substantial change to the work. Even considering the water control 7 needs and resulting delays, Ames substantially performed the work prescribed by the contract. 8 (Compare ECF No. 62 at 9–10 (describing the scope of the project at the bidding stage) with 9 ECF No. 62 at 16 (noting that the major changes resulting from the flooding were a change in 10 sequence of the work and a delay)). At completion, Ames had performed exactly what it 11 contracted to do—build the Wash. See (ECF No. 3 at 4; 52 at 26). Delays and additional costs 12 do not constitute substantial alterations to a contract without a change in the character of the 13 underlying work. See Becho, Inc. v. United States, 47 Fed. Cl. 595, 601 (2000) The court grants 14 summary judgment to the county on Ames’s seventh cause of action. 15 J. Impossibility/Impracticability 16 The county argues that Ames cannot assert impossibility as a claim. (ECF No. 52 at 30). 17 Ames provides authority recognizing impossibility as a claim. (ECF No. 62 at 30). 18 Nevertheless, under the test Ames cites, it fails to state a claim for impossibility. See 19 Transatlantic Financing Corp. v. United States, 363 F.2d 312, 315 (D.C. Cir. 1966). To sustain 20 a claim for impossibility, “first, a contingency—something unexpected—must have occurred. 21 Second, the risk of the unexpected occurrence must not have been allocated either by agreement 22 or by custom. Finally, occurrence of the contingency must have rendered performance 23 commercially impracticable.” Id. 24 Here, something unexpected—the flooding—occurred. (ECF No. 3 at 8). However, the 25 risk of that occurrence was allocated to Ames in the contract. (ECF No. 52 at 4). Any claim 26 Ames might have about the accuracy of that representation is irrelevant when there was explicit 27 assignment of the risk. L.W. Matteson v. United States, 61 Fed. Cl. 296, 320 (2004). For that 28 1} reason, Ames’s impossibility claim fails. /d. The court grants summary judgment as to Ames’s eighth cause of action. 3| IV. Conclusion 4 In summary, the court grants summary judgment in favor of the county as to Ames’s 5 second, third, fourth, fifth, seventh, and eighth causes of action. The court denies summary 6 | judgment as to all other claims. 7 Accordingly, 8 IT IS HEREBY ORDERED, ADJUDGED, and DECREED that the county’s motion for 9 | summary judgment (ECF No. 52) be, and the same hereby is, DENIED in part and GRANTED 10 | in part, consistent with the foregoing. 11 IT IS FURTHER ORDERED that Ames’s request for oral argument (ECF No. 66) be, 12 | andthe same hereby is, DENIED. 13 DATED June 26, 2020. 14 At C. Malan 15 UNITED‘STATES DISTRICT JUDGE 16 17 18 19 20 21 22 23 24 25 26 27 28

es C. Mahan District Judge -12-