Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

United States Welding, Inc. v. Tecsys, Inc.

United States District Court, D. Colorado

January 22, 2015

UNITED STATES WELDING, INC., a Colorado corporation, Plaintiff,
TECSYS, INC., a Canadian corporation, Defendant.


MICHAEL E. HEGARTY, Magistrate Judge.

Before the Court is Plaintiff's Motion to Strike [Defendant Tecsys, Inc.'s] Designation of Non-Parties at Fault [filed December 3, 2014; docket #48]. The motion is fully briefed, and the Court finds oral argument would not materially assist the Court in its adjudication of the motion. For the reasons that follow, the motion is denied.


Plaintiff United States Welding, Inc. ("USW") initiated this action against Defendant Tecsys, Inc. ("Tecsys") on March 17, 2014. (Docket #2.) USW alleges generally that it licensed faulty "EliteSeries" financial management software from TECSYS, that it only entered into the License Agreement because TECSYS intentionally or negligently misrepresented the capabilities and functionality of its EliteSeries software, and that TECSYS failed to perform its support obligations under the License Agreement. Based on these allegations, USW brings the following claims: (1) fraudulent inducement; (2) negligent misrepresentation; (3) gross negligence; (4) willful misconduct; (5) breach of contract; (6) breach of express and implied warranty; (7) breach of the duty of good faith and fair dealing, and (8) breach of fiduciary duty. USW seeks compensatory and punitive damages, together with pre- and post-judgment interest, costs and attorney's fees.

On May 9, 2014, in response to the Complaint, Tecsys filed a Motion to Dismiss pursuant to Rule 12(b)(2), 12(b)(5), and 12(b)(6), requesting that USW's Complaint be dismissed in part with prejudice and in remaining part without prejudice; alternatively, Defendant requested that the Court quash service of the summons, and that the Court strike the Complaint's demand for punitive damages pursuant to Rule 12(f). Docket #14. On July 9, 2014, this Court issued a recommendation that the Motion to Dismiss be granted in part pursuant to Fed.R.Civ.P. 12(b)(5) for insufficient service of process and denied the motion without prejudice as to Defendant's remaining arguments. Docket #29. Since that time, USW again attempted and effected service of process; accordingly, the

On September 5, 2014, Tecsys filed a Renewed Motion to Dismiss informing the Court that "with the exception of the reservation noted in Note 1 above [service effected outside deadline set in Fed.R.Civ.P. 4(m)], Tecsys does not challenge the validity of that service, "[1] and asked that the Court rule on the remaining Rule 12(b)(6) arguments. Motion, docket #32 at 2 n.2. After full briefing on the motion, this Court issued a Report and Recommendation on December 1, 2014 that the motion be granted in part and denied in part. Docket #47. The recommendation and motion remain pending before the District Court.

Meanwhile, Tecsys filed a "Designation of Non-Parties at Fault" on June 16, 2014 identifying Optimum Networking LLC as an entity that "may be at fault in whole or in part." Docket #20. Days later, this Court issued a Scheduling Order on June 20, 2014 and the parties have engaged in formal discovery since that time. In fact, at the parties' request, the Court issued a Stipulated Protective Order regarding the production of confidential information and documents on November 6, 2014. Docket #43. On November 12, 2014, Tecsys filed an "Errata to Designation of Non-Parties at Fault" asserting that it had "inadvertently misnamed Optimum Networking as an LLC instead of Inc." Docket #45. The Errata does not explain how Tecsys learned of its error.

USW filed the present motion to strike on December 3, 2014 arguing that Tecsys' designation of Optimum Networking, Inc. is "improper, untimely, [and] invalid" because "it attempts to substitute one party for another; it does not simply cure a minor detail or misprint, " because "Optimum did not owe a duty to USW" and because the designation "alleges no facts that can reasonably establish a prima facie case against Optimum." Motion, docket #48.

Tecsys counters that any delay in the filing of the November 12, 2014 designation should be excused because the amendment simply changed "LLC" to "Inc."; the designation contains sufficient information and need not set out all relevant facts under Colorado law; and USW's contract and tort claims depend on tort-like duties. Moreover, Tecsys asserts that USW's objections regarding the content of the amended designation have been waived, since the content is identical to the original designation and USW failed to file a motion to strike that designation within the deadline set forth in Fed.R.Civ.P. 12(c).

USW replies "disagreeing" with Tecsys that its objections are waived under Rule 12(c) and asserting that it filed the present motion within the deadline. USW also repeats its arguments that the designation fails to establish a prima facie case and that Optimum owed a duty to USW.


Federal courts sitting in diversity are bound by state statutes when deciding questions of substantive law. Erie R. Co. v. Tompkins, 304 U.S. 64, 78 (1938). Defendant designated Optimum pursuant to Colo. Rev. Stat. § 13-21-111.5, which allows a defendant to designate as a nonparty at fault an individual or entity "wholly or partially at fault" for the damages alleged by the plaintiff in civil liability cases. For a designation of a non-party to be proper, the moving party must give notice of the designation within ninety (90) days of the commencement of the action, unless the court considers a longer period necessary. Colo. Rev. Stat. § 13-21-111.5(3)(b). The notice must set forth the "nonparty's name and last-known address, or the best identification of such nonparty which is possible under the circumstances, together with a brief statement of the basis for believing such nonparty to be at fault." Id. This designation ensures that parties found liable will not be responsible for more than their fair share of the damages. Stone v. Satriana, 41 P.3d 705, 708-09 (Colo. 2002).

In Redden v. SCI Colorado Funeral Servs., 38 P.3d 75 (Colo. 2001) (en banc), the Colorado Supreme Court held that "[c]ourts should construe [nonparty] designation requirements strictly to avoid a defendant attributing liability to a non-party from whom the plaintiff cannot recover." Id. at 80 (citing cases). The court stated, "Our statute is clear that a non-party designation is reserved for individuals or entities who might themselves be at fault and therefore liable for the injury at issue." Id. at 81 ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.