Cully Corporation v. United States

CORRECTED
In the United States Court of Federal Claims
No. 19-339C
Filed: April 11, 2023
CULLY CORPORATION,
Plaintiff,
v.
THE UNITED STATES,
Defendant.
Samuel J. Fortier, Fortier & Mikko, P.C., Anchorage, AK, for Plaintiff.
Joseph A. Pixley and Bret R. Vallacher, Trial Attorneys, L. Misha Preheim, Assistant Director,
Patricia M. McCarthy, Director, and Brian M. Boynton, Acting Assistant Attorney General,
Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington,
D.C., with Robin M. Richardson, Senior Environmental Litigation Attorney for AF/JA-
Operations and International Law, Environmental Law and Litigation Division, for Defendant.
MEMORANDUM OPINION AND ORDER
TAPP, Judge.
The Court has previously cautioned that a party’s petition for reconsideration should
occur only after “a period of intensive retrospection” which contemplates the merits of the
request and “well-established structures governing” reconsideration. Lodge Constr., Inc. v.
United States, 159 Fed. Cl. 414, 418 (2022) (concerning reconsideration of interlocutory orders
pursuant to RCFC 54(b)). This also applies to the context of reconsideration requests pursuant to
RCFC 59. Stated plainly: motions to reconsider are seldom appropriate. Such is the case here.
On December 28, 2022, the Court determined that Plaintiff, Cully Corporation (“Cully”),
failed to prove compensable damages in this takings case and directed judgment for the United
States. Cully Corp. v. United States, 163 Fed. Cl. 676, 679–686 (2022); (ECF No. 207 (“Post-Tr.
Op.”) at 2–11). Cully timely moved for this Court to reconsider that decision, reasserting
previous arguments and contending that the Court misconstrued evidence and misapplied case
law. (ECF Nos. 209, 210). 1 The Court did not solicit a response from the United States pursuant
1
Cully’s supporting brief was filed as a separate document instead of an attachment to its
Motion. (See Pl.’s Br., ECF No. 210). This is improper form based on RCFC 7(b); there is no
provision in the rules allowing for a brief to be filed separately from a motion. The Court
nevertheless accepts this filing and all citations to Cully’s arguments will be to the separate brief
docketed at ECF No. 210.
to RCFC 59(f). 2 After a thorough review of the record, the Court finds no basis to reconsider its
previous decision, therefore the Court denies Cully’s Motion.
There is little the Court can reiterate regarding the background and facts of this case, thus
it defers to previous summarizations and findings of fact. (See ECF Nos. 36, 59, 180, 207). It
serves only to briefly summarize the Post-Trial Opinion. After finding that Cully possessed a
reversionary interest in three buildings located in Point Lay, Alaska, and that those interests were
temporarily divested by the United States, the Court conducted a trial specific to damages in
Fairbanks, Alaska in the summer of 2022. See generally Cully Corp. v. United States, 160 Fed.
Cl. 360 (2022). Afterwards, the Court found that Cully failed to establish actual damages
compensable by the Fifth Amendment or in quantum meruit. (See generally Post-Tr. Op.).
The Court considered the atypical nature of the interest at issue—a reversionary
interest—and held that traditional compensation methods did not apply. (Post-Tr. Op. at 14). The
Court did not articulate a specific calculation in its Post-Trial Opinion because it did not get that
far. Cully failed to establish it attempted to enforce its rights under the lease with the North Slope
Borough. Instead, Cully provided expert testimony regarding damages predicated on the flawed
assumption that Cully had attempted to exercise those rights. (Id.). This effectively puts the cart
before the horse. Even if Cully produced some relevant evidence regarding an actual effort to
enforce its economic rights, the United States’ damage expert offered credible testimony that
Cully’s reversionary interest for the relevant period was of negligible value. (Id.). Finally, the
Court found that Cully could not recover quantum meruit because it did not offer evidence that
Cully paid for remediation to the property. (Id. at 15–17). Cully’s Motion to Reconsider is
grounded in RCFC 59 and applies to the entirety of the Court’s findings and conclusions.
RCFC 59(e) allows a party to file “[a] motion to alter or amend a judgment . . . no later
than [twenty-eight] days after the entry of the judgment.” A motion seeking “a substantive
change in the judgment”—that is “a revision which disturbs or revises legal rights and
obligations that were settled by the previous judgment”—is considered an RCFC 59(e) motion.
Maxus Energy Corp. & Subsidiaries v. United States, 31 F.3d 1135, 1139 (Fed. Cir. 1994). The
Court will grant a motion pursuant to RCFC 59(e) only under extraordinary circumstances,
including: “(1) an intervening change in the controlling law; (2) the availability of new evidence;
or (3) the need to correct clear error or prevent manifest injustice.” IAP Worldwide Servs., Inc. v.
United States, 141 Fed. Cl. 788, 801 (2019) (internal citations omitted); see also Ajinomoto Co.,
Inc. v. Archer-Daniels-Midland Co., 228 F.3d 1338, 1350 (Fed. Cir. 2000) (discussing the
correlative Federal Rule of Civil Procedure and applicable standard). Motions to reconsider are
therefore limited in nature and should not be used to tender new legal theories, raise arguments
that could have been offered or raised before the entry of judgment, or relitigate prior positions.
See United States v. Kegel, 687 F.2d 214 (8th Cir. 1982). Against this background, the Court
weighs Cully’s Motion to Reconsider. It fails.
Cully first claims that the Court erred when it “fault[ed] Cully because Cully, according
to the Court, did not attempt to enforce the lease.” (Pl.’s Br. at 4 (citing Post-Tr. Op. at 14)). In
2
RCFC 59(f) provides in part that “[a] response to any motion under this rule may be filed only
at the court's request and within the time specified by the court.”
2
other words, Cully believes that to succeed on the merits of this case, it is irrelevant to establish
whether it took efforts to enforce the lease. Based on this position, the Court cannot discern why
this issue is material for reconsideration. The Court addresses the argument, nonetheless. Cully
argues that there are two factual errors in this finding. (Id. at 5).
First, Cully believes that the Court erred when it found that Cully did not attempt to
enforce the lease until after ouster. (Id. (citing Post-Tr. Op. at 14); Id. at 6–7). Yet, the proof was
unambiguous, and Cully did not—and does not now—cite controverting testimony. Cully did
not: attempt to “evict” the North Slope Borough (the tenant of the buildings); litigate the validity
of the transfer documents in a court with proper jurisdiction to obtain a declaratory judgment
allowing enforcement of lease provisions; “negotiate” with the North Slope Borough until after
ouster; or insure the buildings until approximately one year after the United States’ ouster letter.
(See Post-Tr. Op. at 8). Moreover, Cully did not list these buildings or its interest in them on its
relevant financial reports, strongly intimating that either it did not believe it owned the buildings
or that the value of the buildings was so trivial that it could be omitted from its balance sheet.
(Tr. Blue 437:21–24).
Second, Cully believes that the Court’s conclusion that Ms. Awalin, the current president
of Cully, was oblivious to the lease and the language therein is “blatantly unsupported by the
record.” (Pl.’s Br. at 5 (citing Post-Tr. Op. at 7)). This is false. As the Court cites in its Post-Trial
Decision, counsel for Cully elicited this fact during the questioning of Ms. Awalin:
Plaintiff’s Counsel: My question to you is whether or not before you received
this letter [of April 2013] you were aware that there was a [twenty-five]-year
lease that covered your buildings that had not been amended.
Ms. Awalin: Correct.
Plaintiff’s Counsel: Were you aware of that?
Ms. Awalin: Of the lease? Not until later.
(Tr. Awalin 64:15–21) (emphasis added). 3 Accordingly, Cully’s assertion is contrary to the
testimony and therefore unsupported by the record. Had Cully wanted to rehabilitate Ms. Awalin,
it could have done so. It did not.
Cully also argues that the Court failed to consider actions taken in 2012 that Cully
believes demonstrate an assertion of ownership of the buildings. (Pl.’s Br. at 5). Not so. These
actions were not, as Cully now claims, an attempt to “resolve the lease.” (Id.). Testimony
established instead what is best described as token efforts to re-lease the buildings and limit
trespassers. (See Awalin Tr. 55:20-24 (“We started creating ‘do not trespass’ signs and put our
phone number on -- on -- we made some magnets since these are steel buildings, to inform
3
The Trial Transcript consists of 836 pages and is separated into four volumes located at ECF
Nos. 193 (pp. 1–230), 195 (pp. 231–427), 197 (pp. 428–679), and 199 (pp. 680–836). The Court
cites the Transcript using the name of the testifying witness, then the consecutive pagination and
line numbers, (Tr. NAME, __: __–__).
3
people if they would like to lease our facilities, that they -- they can contact us.”); Awalin Tr.
58:10-15 (“[I]n 2011[,] . . . I went up to Point Lay to inspect the buildings and found that they
were being utilized by the North Slope Borough. And so I pursued to that they needed to have a
lease with Cully and that they were in trespass.”)). The Court is, again, unpersuaded to
reconsider on these grounds. As the trier-of-fact, the Court determined that Ms. Awalin’s
testimony was unconvincing regarding the resolution of the lease.
Next, Cully again asks this Court to effectively find that Cully should have had
possessory rights to the three buildings at issue and determine that the lease was transferred to
Cully as lessor. (Pl.’s Br. at 12–14). The Court has iterated ad nauseam that it lacks jurisdiction
to issue such a finding. The Court of Federal Claims has limited jurisdiction and is not a panacea
for every grievance Cully may have. The determination that Cully possessed a reversionary
interest was litigated and determined at summary judgment, after the Court held that it was
bound by the findings of the Alaska Superior Court’s decision in Cully Corp. v. AECOM. Cully
Corp., 160 Fed. Cl. at 373–74. Reconsideration of that decision, at this stage, is inappropriate.
Cully did not pursue an interlocutory appeal, and any request for the Court to revisit those
findings now—post-trial, post-judgment—would be improper and untimely. RCFC 54(b)
(decisions that adjudicate fewer than all claims may only be revised before the entry of a final
judgment); (see also Post-Tr. Op. at 13 (“By moving for reconsideration [of summary judgment]
under the guise of post-trial briefing, the United States has . . . disadvantaged [Plaintiff] by
rehashing issues previously decided and thus unavailable at trial.”)).
Cully also asserts that the Court incorrectly analyzed the value of the buildings. Cully
cites the Court’s recognition that the usual measure of damages for the temporary taking was fair
rental value. (Pl.’s Br. at 5 (citing ECF No. 149 at 6 (a usual measure of damage is “fair rental
value” (internal citations omitted)); Pl’s Br. at 12–13). But Cully conveniently ignores that the
Court never arrived at a damages calculation. In doing so, Cully omits the Court’s subsequent
sentence in its Post-Trial Decision which states that, when considering a reversionary interest,
the method laid out in Kimball Laundry Co. v. United States, 338 U.S., at 1, 7, is inapplicable.
(Post-Tr. Op. at 14). The Court has echoed this finding—first in its Summary Judgment Opinion
and again in the Post-Trial Decision. Further, the Federal Circuit has held that traditional
compensation methods are not exclusive; for example, there may be appropriate alternative
valuation methods for the taking of an easement. See Vaizburd v. United States, 384 F.3d 1278,
1285–87 (Fed. Cir. 2004). Therefore, even if Cully provided affirmative evidence of actual
damages, which it did not, Cully’s assertion that this method was not followed mischaracterizes
the Court’s finding.
In its Post-Trial Opinion, the Court was never in a position to establish the correct
calculation for Cully’s reversionary interest because Cully did not establish the value of that
interest. Thus, there was no reason to calculate damages, and the Court could not have ignored
the applicable state law as Cully claims. (See Pl.’s Br. at 12). Although Cully’s basis for the
Motion to Reconsider is that the Court failed to follow the controlling law, it does so by arguing
that its theory of the case is sufficient to contradict the Court’s conclusion. The fallacy in this
argument is that it begs the question of whether Cully’s interest carried value; the Court found
that, after reviewing the evidence, Cully failed to provide supporting documentation that would
allow the Court to find in its favor. Cully’s claims of error merely articulate a disagreement with
the Court’s conclusions; this itself is not a sufficient reason to reconsider judgment. This
4
determination should not come as a surprise when the Court already denied the United States’
motion to reconsider on similar, insufficient grounds. (Post-Tr. Op. at 11–13 (addressing United
States’ motion to reconsider)). At any rate, Cully’s disagreement is not an “extraordinary
circumstance” necessary for the Court’s reconsideration. IAP Worldwide Servs., 141 Fed. Cl. at
801.
As to the quantum meruit claim, Ms. Awalin testified that evidence of remediation costs
existed “in [her] office in Anchorage,” (Tr. Awalin, 54:22–25), but such evidence was never
produced. This failure was a severe deficiency in Cully’s trial proof. Cully argues that the Court
overlooked its proof of damages when it held that no documentation of the cost of remediation to
Cully was proffered at trial. (Pl.’s Mot. at 5 (citing “ECF 16”); Id. at 18–21 (citing PX09)). 4
Cully’s smoking gun: an e-mail estimate of how much that work would have cost.
4
“ECF 16” references a Scheduling Order from 2019. Assuming that this reference is a
scrivener’s error and intended to read “Exhibit 16,” that document was not entered into evidence.
5
(PX9). A receipt it is not. See, e.g., Receive, Webster’s New Int’l Dictionary of the English
Language, 2076 (2d ed. 1958) (defining “receive” as “[t]o take, as something that is offered,
given, committed, sent, paid or the like; to accept, as to receive payment,” including “[t]o come
into possession of, get acquire, or the like, from any source outside of oneself”); Receipt, Black’s
Law Dictionary, 1501 (3d ed. 1944) (defining “receipt” as “[t]he written acknowledgment of the
receipt of money or a thing of value,” including an “act or transaction of accepting or taking
anything delivered”). Cully’s emailed “estimate,” the word used in the document itself, does not
establish any sum spent for remediation or a monetary transaction. “Determining the weight and
credibility of the evidence” is within the Court’s province. Inwood Lab., Inc. v. Ives lab., Inc.,
456 U.S. 844, 856 (1982). Contrary to Cully’s mischaracterization, this email did not constitute
affirmative, much less credible, evidence of remediation damages. Cully’s assertions that the
Court ignored evidence of damages does not occasion reconsideration in this circumstance.
Finally, Cully asserts that the Court ignored that Mr. Longtin 5 and Col. Skaja 6 had
implied authority to contract thereby forming an implied-in-fact contract. (Pl.’s Br. at 23). Cully
explicitly states: “the circumstances and the acts of the parties demonstrate the existence of
contract implied in fact to not demolish the buildings but to give possession of them to Cully
upon Cully’s successful remediation of the garage[.]” (Id.) A government representative's
authority is “generally implied when such authority is considered to be an integral part of the
duties assigned to a [g]overnment employee.” H. Landau & Co. v. United States, 886 F.2d 322,
324 (Fed. Cir. 1989) (quoting J. Cibinic & R. Nash, Formation of Government Contracts 43
(1982)). “The word integral has been interpreted to mean ‘essential’ or ‘necessary to form a
whole.’” Roy v. United States, 38 Fed. Cl. 184, 189 (1997) (quoting Cruz-Pagan v. United
States, 35 Fed. Cl. 59, 61 (1996)), appeal dismissed, 124 F.3d 224 (Fed. Cir. July 10, 1997)
(unpublished table opinion). “[Contracting] [a]uthority is integral ‘when the government
employee could not perform his or her assigned tasks without such authority.’” Liberty
Ammunition, Inc. v. United States, 835 F.3d 1388, 1402 (Fed. Cir. 2016) (quoting Flexfab, LLC
v. United States, 62 Fed. Cl. 139, 148 (2004), aff’d, 424 F.3d 1254 (Fed. Cir. 2005)). Even if
Cully could prove it incurred damages, it did not show that the ability to contract was integral to
Mr. Longtin or Col. Skaja’s positions.
Such a distinction is negligible because Cully also failed to show a “meeting of the
minds” necessary to meet the elements of an implied-in-fact contract. See La Van v. United
States, 382 F.3d 1340, 1346 (Fed. Cir. 2004) (“[A]n implied-in-fact contract is founded upon a
meeting of the minds, which, although not embodied in an express contract, is inferred, as a fact,
from conduct of the parties showing, in the light of the surrounding circumstances, their tacit
understanding.”). For instance, on June 30, 2005, Mr. Longtin e-mailed Cully’s president at the
time, Elsie Hendryx, and stated, in relevant part, “any work done under the Garage is being done
5
David Longtin was a GS-11/12 civilian Air Force employee and served as remedial project
manager for the LRRS cleanup from 2003 to 2006. (Tr. Longtin, 134:14–19; Tr. Longtin, 160:3–
12, 16–18).
6
Air Force Colonel Joseph Skaja, Jr. served as the Commander of the 611th Air Support Group
in Alaska from 2005 to 2007, with responsibility for the closed Point Lay LRRS. (Tr. Skaja,
182:19–21; Tr. Skaja 183:1–20).
6
at Cully’s own risk. In other words, we can’t promise you the building as a result of the work
you do. However, if no work is done, we CAN promise you the building will be demolished.”
(PX6 (emphasis in original)). Likewise, Colonel Skaja’s understanding was that if Cully
undertook the remediation, Cully would receive possession of the three buildings, but he did not
personally negotiate with any representative of Cully regarding this arrangement. (See Tr. Skaja
189:19–25; Tr. Skaja 190:1–2; Tr. Skaja 196:23–25; Tr. Skaja 197:2–14). Taken together, this
testimony demonstrates a lack of agreement between Cully and the United States.
In sum, Cully articulates no intervening change in the controlling law, newly discovered
evidence, need to correct clear factual or legal error, or need to prevent manifest injustice. See
IAP Worldwide Servs., 141 Fed. Cl. at 801. In the Court’s view, Cully merely relitigates its prior
positions, an impermissible use of RCFC 59. Audio Evolution Diagnostics, Inc. v. United States,
162 Fed. Cl. 73, 77 (2022) (citing Froudi v. United States, 22 Cl. Ct. 290, 300 (1991) (“[A]
motion for reconsideration is not a vehicle for giving an unhappy litigant an additional chance to
sway the judge, nor is it intended to allow a party to make arguments already presented to, and
rejected by, the court.”)).
Given the limited nature of a motion to reconsider, the Court finds no basis to grant
Cully’s Motion. Cully’s Motion is DENIED. (ECF No. 209). The Court’s Post-Trial Decision
stands and is final.
IT IS SO ORDERED.
s/ David A. Tapp
DAVID A. TAPP, Judge
7