MDK Sociedad v. Proplant

Case: 21-20207 Document: 00516196970 Page: 1 Date Filed: 02/09/2022
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
FILED
February 9, 2022
No. 21-20207 Lyle W. Cayce
Clerk
MDK Sociedad De Responsabilidad Limitada,
Plaintiff—Appellant/Cross-Appellee,
versus
Proplant Incorporated (Texas); Proplant Incorporated
(Nevada),
Defendants—Appellees/Cross-Appellants.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:18-CV-485
Before Jones, Higginson, and Duncan, Circuit Judges.
Stephen A. Higginson, Circuit Judge:
MDK Sociedad de Responsabilidad Limitada (“MDK”), a Bolivian
entity, and Proplant, Inc., a Texas-based corporation, jointly pursued a
lucrative operations and maintenance contract with Bolivia’s state-owned
energy company. After the deal fell through, MDK sued Proplant under both
breach of contract and tort theories. Before discovery was complete, the
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district court granted Proplant’s motion for summary judgment. We
AFFIRM. 1
I.
MDK’s complaint alleges that Proplant provided MDK with a
proposed contract for subcontractor services in October 2016 (“the October
Document”). MDK alleges that as of November 11, 2016, it had not executed
the October Document. The district court found that MDK never signed the
October Document, and nothing in the record indicates otherwise.
MDK alleges that, in November 2016, Proplant told MDK that
Proplant would provide the bid and performance bonds for a “potential
contract in Bolivia.” Proplant allegedly waited until the final days before the
due date before asking for more time to provide the bond. On December 13,
2016, Proplant allegedly informed MDK that, because of complexities
relating to sending money overseas, it could not submit the bond. Proplant
allegedly asked MDK to submit the bond instead. MDK allegedly replied that
it would only submit the bond if Proplant signed a contract promising to pay
MDK for the bond.
The record indicates that on December 13, 2016, MDK and Proplant
executed a “Commitment Agreement.” The Commitment Agreement
explained that Yacimientos Petroliferos Fiscales Bolivianos (“YPFB”),
Bolivia’s state-owned energy company, was soliciting bids for an operations
and maintenance (“O&M”) contract. The Commitment Agreement
1
On the same day that the district court granted Proplant’s summary judgment
motion, it also granted MDK’s motion to dismiss Proplant’s counterclaims against MDK.
Proplant filed a notice of cross-appeal but stated in its brief that it “waives its cross-appeal
in the event this Court issues an opinion affirming the district court’s summary judgment
in favor of Proplant.” Because we affirm the district court’s summary judgment in favor of
Proplant, we do not consider Proplant’s cross-appeal.
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provided that MDK would assist Proplant with its efforts to obtain this O&M
contract by collecting and filing certain documents for Proplant and by
tendering to YPFB a bid bond of $500,000. In return, Proplant promised to
furnish MDK with certain documents. Proplant also promised to take several
other actions if it were “awarded” the O&M contract. Specifically, Proplant
promised (1) “to execute the O&M agreement with YPFB pursuant to the
terms set forth in” certain documents; (2) to pay MDK $500,000, plus bank
charges, if it “decides not to execute the O&M agreement”; (3) “to
subcontract MDK to provide all the services as set forth in” a separate
document; and (4) to pay MDK $1 million from its “profits resulting from
the execution of the Project.”
The parties agree 2 that on December 14, 2016, Proplant bid on the
YPFB project for the first time. They further agree that after YPFB declared
the project deserted on December 30, Proplant bid on the YPFB project for
a second time on January 19, 2017. MDK alleges that it submitted a $500,000
bid bond to YPFB and that Proplant assured MDK that it would “issue the
contract bond if the bid is awarded.”
The parties agree that a Proplant representative and an MDK
representative met with YPFB on March 20, 2017. Mike Antony, an owner
of Proplant, submitted a declaration stating that at this meeting, YPFB agreed
to incorporate thirty technical and commercial changes into the parties’ bid.
Antony further declared that YPFB requested that Proplant submit certain
documents and a performance bond.
MDK alleges that on March 22, 2017, YPFB awarded Proplant the
O&M contract. MDK further alleges that, after being awarded the contract,
2
In response to a court order, the parties submitted a “Joint Agreed Timeline” to
the district court.
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Proplant was required to tender certain documents to YPFB and to deliver a
performance bond. Proplant allegedly tendered the documents late and never
provided the bond. On April 18, 2017, Proplant allegedly informed MDK that
it would not submit the bond.
The record indicates that on April 3, 2017, an MDK representative
named Pablo Miya sent a WhatsApp message to a Proplant representative
named Murthy Chitturi stating, “I just received a call from these guys saying
that weird things are happening inside YPFB and that please we have to hurry
up with the documents and sign the contract ASAP.” Then on April 4, Miya
messaged Chitturi, “ypfb deadline will be thursday 14th. If we dont sign the
contract and submit the 2 bonds by that date. Legal area will cancell the
bidding process and executing the bid bond.”
The parties agree that on April 5, “Techna sent a Letter of
Transparency complaining about the bid process.” Miya later messaged
Chitturi, “Everything happened because Tecna [sic] sent that letter.”
Antony declared that on April 6, he travelled with Miya to YPFB’s
office in Bolivia to personally deliver the requested documents. However,
Antony continued, because YPFB’s contract manager did not show up to
receive the documents, Antony and Miya left the documents with the
manager’s secretary. Antony further explained that after again trying and
failing to deliver the documents to YPFB several days later, Proplant
representatives emailed the documents to YPFB. Antony concluded his
declaration by stating that YPFB “failed to ever provide Proplant with a
contract to execute.”
The parties agree that on April 21, 2017, “YPFB declared the project
deserted.” The parties further agree that they jointly sought legal advice
from Bolivian lawyers, who advised them that because YPFB had deserted
the project, it was legally obligated to return the bid bond to MDK. The
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Bolivian lawyer stated in an email to Proplant, “YPFB is being abusive and
its actions are politically driven.” The lawyer suggested two legal avenues
that the parties could pursue, but he suggested that because “[t]he counter
party is the Bolivian State (YPFB),” “any legal action could be seriously
undermined by the current political scenario in our country.” Proplant
forwarded the email to MDK, explaining that the Bolivian lawyer had
proposed “two options to counter the politically driven decision by YPFB
with no fault of us.”
In February 2018, MDK sued Proplant. MDK’s complaint raises six
causes of action. First, MDK claims that Proplant breached the October
Document. Second, MDK claims that Proplant committed common law
fraud by promising MDK in November 2016 that it would provide a bid bond
even though it did not intend to do so. Third, MDK claims that Proplant
breached the Commitment Agreement. Fourth, MDK claims that Proplant
made negligent misrepresentations related to the Commitment Agreement.
Fifth, MDK claims that Proplant fraudulently induced MDK into signing the
Commitment Agreement. Finally, MDK claims that Proplant committed
common law fraud with respect to the Commitment Agreement.
On February 20, 2018, the district court issued an “Order for
Conference,” ordering the parties to exchange initial disclosures and to be
“prepared to discuss discovery in a conference so that the court may fashion
a brief, effective management plan.” The court ordered counsel to “appear
for an initial pretrial conference” on May 14, 2018. At that conference, the
court ordered the parties to “file a joint chronology with supporting data” by
May 30. The court also ordered, “Formal discovery is quashed. The parties
will talk.” Finally, the court ordered the dismissal of several Proplant
representatives from the case. On June 26, the court issued another order. In
addition to dismissing another Proplant defendant and repeating the court’s
prior admonition that “[t]he parties will talk,” this order instructed the
5
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parties to submit a document explaining “to the court why the project with
[YPFB] ended and what steps should be taken to advance the litigation.”
Finally, on August 1, the court ordered the parties to “exchange their data
about the life of the deal and to “tell the court whether they want to mediate
and with whom.” The court also signed an order establishing “a procedure
for disclosing confidential information, protecting it, and challenging it.”
On September 4, 2018, Proplant moved for summary judgment,
asking the district court “to dismiss MDK’s claims in their entirety.” The
court granted the motion, dismissing both of MDK’s breach of contract
claims along with its various tort claims. MDK appealed.
II.
MDK argues that the district court abused its discretion by ruling on
Proplant’s summary judgment motion before the parties had completed
discovery.
The Federal Rules of Civil Procedure give district courts the power to
grant summary judgment motions before the parties have completed
discovery. See Fed. R. Civ. P. 56(b) (“Unless a different time is set by
local rule or the court orders otherwise, a party may file a motion for
summary judgment at any time until 30 days after the close of all
discovery.”); Mendez v. Poitevent, 823 F.3d 326, 336 (5th Cir. 2016) (“Rule
56 does not require that any discovery take place before summary judgment
can be granted.” (citation omitted)). The Rules also protect parties from
premature summary judgment motions, providing that if a “nonmovant
shows by affidavit or declaration that, for specified reasons, it cannot present
facts essential to justify its opposition, the court may: (1) defer considering
the motion or deny it; (2) allow time to obtain affidavits or declarations or to
take discovery; or (3) issue any other appropriate order.” Fed. R. Civ. P.
56(d). However, “non-moving parties requesting Rule 56(d) relief ‘may not
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simply rely on vague assertions that additional discovery will produce
needed, but unspecified, facts.’” Am. Family Life Assurance Co. of Columbus
v. Biles, 714 F.3d 887, 894 (5th Cir. 2013) (quoting Raby v. Livingston, 600
F.3d 552, 561 (5th Cir. 2010)). “Instead, the non-moving party must ‘set
forth a plausible basis for believing that specified facts, susceptible of
collection within a reasonable time frame, probably exist and indicate how
the emergent facts, if adduced, will influence the outcome of the pending
summary judgment motion.’” Id. (quoting Raby, 600 F.3d at 561). We review
a district court’s denial of a Rule 56(d) request for abuse of discretion.
Mendez, 823 F.3d at 331.
Here, MDK did not file in the district court a Rule 56(d) affidavit or
declaration requesting additional discovery. MDK did briefly argue in its
response to Proplant’s summary judgment motion that the “motion for
summary judgment is premature because discovery is incomplete.”
However, the response did not “identify specific facts below that would alter
the district court’s analysis” or in any way “demonstrate . . . how the
additional discovery would likely create a genuine [dispute] of material fact.”
Mendez, 823 F.3d at 337 (cleaned up). 3 Rather, it simply asserted that “no
depositions have been held, nor have interrogatories, requests for admission,
nor requests for documents been exchanged between the parties” and that
the “defendant has repeatedly failed to provide evidence of its allegations
despite numerous opportunities to do so.” Accordingly, assuming arguendo
that MDK’s response to Proplant’s summary judgment motion qualifies as a
Rule 56(d) request for additional discovery, the court did not abuse its
3
In 2010, the wording of the summary judgment standard was revised to refer to a
genuine “dispute” of material fact, rather than a genuine “issue.” See Fed. R. Civ. P. 56
advisory committee’s note to 2010 amendment. Accordingly, where appropriate, this
opinion substitutes “dispute” for “issue.”
7
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discretion by implicitly denying the request. Cf. Washington v. Allstate Ins.
Co., 901 F.2d 1281, 1285-86 (5th Cir. 1990) (“Assuming, without deciding,
that Washington’s request for discovery in his supplemental memorandum
constituted a request for a Rule 56(f) continuance, we find that the trial judge
did not abuse his discretion in denying the request.”). 4 And because MDK
did not meet the Rule 56(d) standard for deferring summary judgment, the
district court did not err by ruling on Proplant’s summary judgment motion
before the parties had completed discovery.
III.
MDK suggests in its reply brief that Proplant’s summary judgment
motion was “legally deficient” under Federal Rule of Civil Procedure 56
because the motion identifies “dispositive facts” rather than “undisputed
facts” and relies on “inadmissible hearsay. MDK also contends in its reply
brief that the district court’s summary judgment order was “legally
deficient” because its “assumes undisputed facts” and dismissed MDK’s
tort claims “sua sponte.” However, MDK’s opening brief barely mentions
these arguments and does not support them with any citations either to legal
authorities or to the record.
An appellant’s brief must contain the “appellant’s contentions and
the reasons for them, with citations to the authorities and parts of the record
on which the appellant relies.” Fed. R. App. P. 28(a)(8)(A). “A party that
asserts an argument on appeal, but fails to adequately brief it, is deemed to
have waived it.” United States v. Scroggins, 599 F.3d 433, 446 (5th Cir. 2010)
(citation omitted). Moreover, because we do not consider issues raises for the
first time in an appellant’s reply brief, see, e.g., Alaniz v. Zamora-Quezada, 591
4
Rule 56(f) was recodified as Rule 56(d) in 2010. See Fed. R. Civ. P. 56 advisory
committee’s note to 2010 amendment.
8
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F.3d 761, 777 (5th Cir. 2009), “[a]n appellant abandons all issues not raised
and argued in its initial brief on appeal,” Cinel v. Connick, 15 F.3d 1338, 1345
(5th Cir. 1994).
MDK’s opening brief failed to adequately present its arguments that
Proplant’s summary judgment motion and the district court’s summary
judgment order were “legally deficient.” Accordingly, MDK has waived
these issues, and we do not consider them.
IV.
Finally, MDK argues that the district court erred by granting
summary judgment in favor of Proplant on MDK’s breach of contract
claims. 5
“We review de novo a district court’s grant of summary judgment.”
Nola Spice Designs, L.L.C. v. Haydel Enterprises, Inc., 783 F.3d 527, 536 (5th
Cir. 2015). “Summary judgment is appropriate ‘if the movant shows that
there is no genuine dispute as to any material fact and the movant is entitled
to judgment as a matter of law.’” Id. (quoting Fed. R. Civ. P. 56(a)). “A
genuine dispute of material fact exists when the ‘evidence is such that a
reasonable jury could return a verdict for the nonmoving party.’” Id. (quoting
Royal v. CCC & R Tres Arboles, L.L.C., 736 F.3d 396, 400 (5th Cir. 2013)).
The party moving for summary judgment “bears the initial responsibility of
informing the district court of the basis for its motion, and identifying those
portions of [the record] which it believes demonstrate the absence of a
genuine [dispute] of material fact.” Id. (quoting E.E.O.C. v. LHC Grp., Inc.,
5
The district court also granted summary judgment in favor of Proplant on MDK’s
various tort claims. While MDK seeks reversal of these rulings on the above-described
procedural grounds, it does not challenge the court’s judgment against its tort claims on
the merits.
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773 F.3d 688, 694 (5th Cir. 2014)) (first alteration in original). However,
“[o]nce the moving party fulfills this responsibility, the non-moving party
must ‘go beyond the pleadings and by her own affidavits, or by the
depositions, answers to interrogatories, and admissions on file, designate
specific facts showing that there is a genuine [dispute] for trial.’” Id. (citation
omitted).
The parties agree that Texas law governs MDK’s breach of contract
claims. Texas requires plaintiffs raising a claim for breach of contract to show
that: “(1) a valid contract exists; (2) the plaintiff performed or tendered
performance as contractually required; (3) the defendant breached the
contract by failing to perform or tender performance as contractually
required; and (4) the plaintiff sustained damages due to the breach.”
Pathfinder Oil & Gas, Inc. v. Great W. Drilling, Ltd., 574 S.W.3d 882, 890
(Tex. 2019).
MDK raises two breach of contract claims. Its first breach of contract
claim involves the October Document. The district court granted Proplant’s
motion for summary judgment on this claim on the ground that the October
Document “was not signed by both parties and did not create a valid
contract.”
To prove “the existence of a valid contract,” the plaintiff must show,
inter alia, that “the parties executed and delivered the contract with the
intent that it be mutual and binding.” USAA Texas Lloyds Co. v. Menchaca,
545 S.W.3d 479, 501 n.21 (Tex. 2018). MDK alleges in its complaint that as
of November 11, 2016, it had not executed the October Document, and
nothing in the record indicates that the October Document was subsequently
executed. When “the non-movant bears the burden of proof at trial,” a party
moving for summary judgment “may merely point to the absence of evidence
and thereby shift to the non-movant the burden of demonstrating by
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competent summary judgment proof that there is [a dispute] of material fact
warranting trial.” Nola Spice Designs, 783 F.3d at 536 (citation omitted). In
its summary judgment motion, Proplant argued that MDK had not executed
the October Document. Because MDK has the burden of proof on this issue
but has not pointed to any evidence suggesting that it did in fact execute the
October Document, the district court did not err by granting summary
judgment in favor of Proplant on MDK’s first breach of contract claim.
The district court also granted Proplant’s motion for summary
judgment on MDK’s second breach of contract claim, which concerned the
Commitment Agreement. The court reasoned that while YPFB “may have
selected Proplant’s bid as the winning bid, . . . it would not be officially
awarded until Proplant and [YPFB] finalized the terms with a signed
contract.” However, YPFB “deserted the bid—for whatever reason—before
it signed a contract with Proplant, so the bid was never awarded.” And, the
court concluded, because “the bid being awarded was a condition precedent
to Proplant’s obligations under the [Commitment Agreement], it did not
breach the contract by not doing what MDK alleges.”
“A condition precedent is an event that must happen or be performed
before a right can accrue to enforce an obligation.” Centex Corp. v. Dalton,
840 S.W.2d 952, 956 (Tex. 1992). “A party seeking to recover under a
contract bears the burden of proving that all conditions precedent have been
satisfied.” Associated Indem. Corp. v. CAT Contracting, Inc., 964 S.W.2d 276,
283 (Tex. 1998). The Commitment Agreement required Proplant to take
several actions, including paying MDK $500,000, “[i]f awarded with the
Project,” that is, if YPFB awarded Proplant the O&M contract. MDK alleges
in its complaint that Proplant was “awarded the project” on March 22, 2017.
However, Proplant argued in its summary judgment motion that YPFB had
not awarded it the project; in fact, Proplant argued, YPFB had deserted the
project.
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Once again, when “the non-movant bears the burden of proof at
trial,” a party moving for summary judgment “may merely point to the
absence of evidence and thereby shift to the non-movant the burden of
demonstrating by competent summary judgment proof that there is [a
dispute] of material fact warranting trial.” Nola Spice Designs, 783 F.3d at 536
(citation omitted). After Proplant argued that YPFB had not awarded it the
project, MDK directed the court to an exhibit containing two untranslated
documents written in Spanish. “Normally, the submission of foreign
documents unaccompanied by English translations is error, and such
documents would not be considered on appeal.” United States v. Valdivia,
680 F.3d 33, 45 (1st Cir. 2012); see also Unified Buddhist Church of Vietnam v.
Unified Buddhist Church of Vietnam, 838 F. App’x 809, 813 (5th Cir. 2020)
(unpublished). MDK did not direct the court to any other evidence. MDK
thus failed to meet its burden of demonstrating by competent evidence that
there is a dispute of material fact as to whether YPFB awarded Proplant the
O&M contract. Accordingly, the district court did not err in granting
Proplant’s motion for summary judgment on MDK’s second breach of
contract claim. 6
V.
For the foregoing reasons, we AFFIRM the judgment of the district
court.
6
The Commitment Agreement imposed one obligation on Proplant that did not
have a condition precedent: “[f]urnishing MDK with all the documents listed in the
technical specifications documents of the Bid.” MDK argues that Proplant did not deliver
certain documents to YPFB. However, MDK did not argue in the district court, and does
not argue on appeal, that Proplant failed to deliver any documents to MDK. Accordingly,
the question of whether Proplant breached this obligation is not before us.
12