IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA 

 

MLEA, INC., : 

 : CIVIL ACTION 

 Plaintiff, : 

 : 

 v. : No. 02-CV-4393 

 : 

ATLANTIC RECYCLED RUBBER : 

INC., RECOVERY TECHNOLOGIES : 

GROUP INC., AND CASELLA : 

WASTE SYSTEMS, INC. : 

 : 

 Defendants. :

ORDER

AND NOW, this ___________ day of ____________, 2004, upon consideration of 

defendant Casella Waste Systems, Inc.'s Motion for Summary Judgment, and any responses and 

replies thereto, it is HEREBY ORDERED that the motion is GRANTED, and that plaintiff's 

Complaint against defendant Casella is dismissed with prejudice. 

JAMES MCGIRR KELLY 

United States District Judge 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 1 of 29
IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA 

 

MLEA, INC., : 

 : CIVIL ACTION 

 Plaintiff, : 

 : 

 v. : No. 02-CV-4393 

 : 

ATLANTIC RECYCLED RUBBER : 

INC., RECOVERY TECHNOLOGIES : 

GROUP INC., AND CASELLA : 

WASTE SYSTEMS, INC. : 

 : 

 Defendants. :

ORDER

AND NOW, this ___________ day of ____________, 2004, upon consideration of 

defendant Casella Waste Systems, Inc.'s Motion for Partial Summary Judgment, and any 

responses and replies thereto, it is HEREBY ORDERED that the motion is GRANTED, and 

that plaintiff's claim as to damages for certain "design/specifications/drawings" and "process 

design/specifications" is DISMISSED and that plaintiff MLEA is LIMITED to only seeking 

damages for those amounts listed on the three purchase orders at issue. 

JAMES MCGIRR KELLY 

United States District Judge 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 2 of 29
IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA 

 

MLEA, INC., : 

 : CIVIL ACTION 

 Plaintiff, : 

 : 

 v. : No. 02-CV-4393 

 : 

ATLANTIC RECYCLED RUBBER : 

INC., et al. : 

 Defendants. :

DEFENDANT CASELLA WASTE SYSTEMS INC.'S MOTION FOR SUMMARY 

JUDGMENT OR, ALTERNATIVELY, FOR PARTIAL SUMMARY JUDGMENT

Pursuant to Federal Rule of Civil Procedure 56, defendant Casella Waste Systems Inc. 

(“Casella”) hereby moves this Court to enter summary Judgment in its favor on all counts of the 

Complaint based on plaintiff's inability to "pierce the corporate veil" of three separate corporate 

entities to reach Casella. Alternatively, Casella moves for partial summary judgment and 

requests that this Court dismiss plaintiff's claim for damages as to certain engineering plans and 

limit plaintiff's remaining claims for damages to the amounts listed in thee three purchase orders 

at issue. Casella incorporates herein the accompanying memorandum of law in support of this 

motion. 

 

 ____________________________ 

Antoinette R. Stone, I.D. No. 23464 

Brian J. McCormick, Jr., I.D. No. 81437 

BUCHANAN INGERSOLL PC 

1835 Market Street, 14th Floor 

Philadelphia, PA 19103 

(215) 665-8700 

(215) 665-8760 (fax) 

Attorneys for Defendant Casella Waste 

Systems Inc. 

Dated: February 10, 2004 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 3 of 29
IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA 

 

MLEA, INC., : 

 : CIVIL ACTION 

 Plaintiff, : 

 : 

 v. : No. 02-CV-4393 

 : 

ATLANTIC RECYCLED RUBBER : 

INC., RECOVERY TECHNOLOGIES : 

GROUP INC., AND CASELLA : 

WASTE SYSTEMS, INC. : 

 : 

 Defendants. :

DEFENDANT CASELLA WASTE SYSTEMS INC.'S MEMORANDUM OF LAW 

IN SUPPORT OF ITS MOTION FOR SUMMARY JUDGMENT OR, 

ALTERNATIVELY, FOR PARTIAL SUMMARY JUDGMENT

Defendant Casella Waste Systems Inc. ("Casella") moves this Court to enter summary 

judgment in its favor on all counts of the Complaint based on plaintiff's inability to "pierce the 

corporate veil" of three separate corporate entities to reach Casella. Alternatively, Casella moves 

for partial summary judgment and requests that this Court dismiss plaintiff's claim for damages 

as to the value of certain engineering plans and limit plaintiff's remaining claims for damages to 

the amounts listed in the three purchase orders at issue for the equipment allegedly ordered. 

Casella's Motion should be granted because, fact discovery having been completed, there are no 

genuine issues of material fact which preclude summary judgment. 

I. INTRODUCTION

Plaintiff MLEA, Inc., as successor in interest to Engineered Gas Systems, LLP and Main 

Line Engineering Associates, instated this action against Atlantic Recycled Rubber, Inc. 

("ARR"), Recovery Technologies Group, Inc. ("RTG"), and Casella alleging that the defendants 

failed to pay for certain "design/specifications/drawings" and "process design/specifications" 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 4 of 29
2

(collectively, "engineering plans") and equipment with an alleged value of approximately $1.6 

million. Plaintiff's sole allegation against Casella for liability in this action is that "[o]n 

information and belief, at all times relevant hereto, Defendants Atlantic [ARR] and Recovery 

Technologies were acting on behalf of Casella." [Complaint, at ¶6]. 

Both the Supreme Court of Pennsylvania and this Court have recognized that the remedy 

known as "piercing the corporate veil" should be reserved for the exceptional case. Piercing the 

corporate veil undercuts the limited liability protection of the corporate form that provides the 

principal reason why businesses elect to incorporate. 

Here, a plaintiff who allegedly entered into an agreement with one corporation is 

attempting to pierce the corporate veil of not only the contracting party, but also two 

intermediary corporate parents, on a record that is utterly devoid of any evidence to justify that 

corporate veil piercing. 

Casella is the "great-grandparent" corporation, a company three levels up the ownership 

chain. Plaintiff is attempting to hold Casella liable for ARR's alleged obligations, even though 

Casella had no direct ownership interest in, or control of, ARR, the party with which MLEA had 

contracted. Under Pennsylvania law, it is inappropriate for a plaintiff to leapfrog up the 

corporate chain of ownership in this manner to impose liability on a party several levels up the 

corporate ladder. Accordingly, defendant Casella should be dismissed from this lawsuit. 

 Casella also moves for partial summary judgment on two grounds. The first is that 

MLEA's claims for damages related to its drafting services of certain "engineering plans" is 

fatally flawed because no defendant ever agreed to reimburse MLEA for those services. The 

second ground is that MLEA is limited to the amount of damages stated in the three purchase 

orders at issue. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 5 of 29
3

 MLEA's own Vice-President of Engineering, Manuel Menendez, has testified that 

neither ARR nor RTG ever agreed to pay for MLEA's services in drafting the engineering plans. 

In addition, MLEA never delivered the entire set of plans to any of the defendants, and Mr. 

Menendez testified that the plans are worthless without the entire set. 

 MLEA also claims that defendants are liable for the full purchase price of each piece of 

equipment listed on three purchase orders between ARR and MLEA. However, the dollar 

amounts listed on two of the purchase orders and the invoice for the other purchase order are 

merely down payments. Indeed, MLEA never even informed ARR of the full purchase price of 

the majority of these items before the purchase orders were requested. Therefore, MLEA's 

recovery is limited to the amounts listed on the purchase orders, not the full purchase prices. 

 

II. FACTUAL BACKGROUND

A. RTG's And ARR's Business

 RTG is a provider of tire recycling services throughout North America, through a 

network of collection, transfer and manufacturing subsidiaries and facilities. ARR is one of 

these subsidiaries.1

 RTG collects used/scrap rubber tires, transfers them to one of its recycling 

sites and manufactures crumb rubber and other rubber-derived products from the tires. 

 RTG and its subsidiaries utilize a patented and unique commercial process to recycle the 

used tires. See Deposition Transcript of Richard Kelley, October 15, 2003, attached hereto as 

Exhibit "B," at 66-74 ("Exhibit "B," Kelley Transcript"). First, the scrapped tires are transported 

 

1

 ARR is a separate corporate entity, formed under the laws of Nova Scotia, Canada. [Complaint, ¶3; Answer and 

Affirmative Defense of Defendants Recovery Technologies Group, Inc. and Atlantic Recycled Rubber, Inc. and 

Counterclaim of Recovery Technologies Group, Inc., ¶3]. ARR is a wholly–owned subsidiary of Recovery 

Technologies Canada, Inc. ("RTI – Canada"). See Deposition Transcript of James Bohlig, October 27, 2003, 

attached hereto as Exhibit "A," at 22-23 ("Exhibit "A," Bohlig Transcript"). RTI – Canada is not a party to this 

lawsuit. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 6 of 29
4

to RTG processing facilities. Id. At these locations, the scrap tires are shredded into much 

smaller pieces, then frozen in liquid nitrogen cryogenic chambers, and finally, the frozen rubber 

pieces are "hammered" into "crumbs" of various sizes. Id. The crumb rubber is then sold to 

manufacturers for use in the fabrication of a number of different items, i.e., playground and 

running track surfaces, shoe soles, carpet underlay, and tires. Id.

B. RTG-Casella Relationship

Casella is a regional solid waste services company that provides collection, transfer, 

disposal and recycling services to residential, industrial and commercial customers, primarily in 

the eastern United States. 

 In December 1999, Casella acquired KTI, Inc., as well as certain of its subsidiaries, 

including various tire recycling assets and commercial recycling facilities. See Exhibit "A," 

Bohlig Transcript, at 12-15. RTG was formed by Casella in July 2000 to consolidate the newly 

acquired tire recycling assets of Casella (formerly of KTI). See Exhibit "A," Bohlig Transcript, 

at 17-18, 19-20. RTG and its subsidiaries (including ARR) focused on the collection, 

processing, and recycling of scrap tires into rubber-derived products, and operated as separate 

and independent companies during the brief time they were Casella subsidiaries.2

 See Exhibit 

"A," Bohlig Transcript, at 17-18, 19-20. 

C. Factual Background

 In the summer of 2000, ARR began to transform its traditional tire-recycling operation in 

Truro, Nova Scotia, Canada (the "Truro facility") into a cryogenic facility using RTG's 

technology. See Exhibit "B," Kelley Transcript, at 40-41, 64-65. However, to utilize the 

cryogenic procedure, ARR was required to purchase, and ship, liquid nitrogen for the Truro 

 

2

 In August 2001, Casella sold 80.1% of its interest in RTG and its affiliates, including ARR, to Crumb Rubber 

Investors Co., LLC as part of Casella's divestiture of its tire recycling business. See Exhibit "A," Bohlig Transcript, 

at 26-27. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 7 of 29
5

facility from a vendor in Maine. Id. at 44-45. The shipment of liquid nitrogen to Truro was costprohibitive, and ARR began to investigate more cost-efficient methods to supply liquid nitrogen 

for the Truro facility. Id. See also Deposition Transcript of Steven Benison, October 14, 2003, 

attached hereto as Exhibit "C," at 47 ("Exhibit "C," Benison Transcript"). One option was to 

have a plant built on-site that would produce liquid nitrogen for use in the Truro facility. See 

Exhibit "B," Kelley Transcript, at 57. 

 Messer Advanced Gas Systems, Inc. ("Messer") (predecessor to plaintiff MLEA),3

through its consultant, George Timberlake, submitted a written offer to construct such a plant in 

August 2000. See Deposition Transcript of George Timberlake, November 18, 2003, attached 

hereto as Exhibit "F," at 18-19, 20-21 ("Exhibit "F," Timberlake Transcript). Messer submitted 

a revised offer on September 13, 2000. See Exhibit "G" attached hereto. Realizing the necessity 

of third-party financing to this project, the offer letter from Mr. Timberlake stated, falsely, that a 

lease had already been "arranged . . . through National Fleet Leasing, . . .." See Exhibit "G." 

As will be shown below, that lease financing was never obtained by MLEA. 

RTI – Canada responded to the September 2000 offer that same day. See Exhibit "H" 

attached hereto. In its response, RTI – Canada stated that "this purchase is contingent on the 

completion of a leasing agreement and acceptance by Canadian and Local authorities." Id. 

(emphasis added). See also Deposition Transcript of Manuel Menendez, August 15, 2003, 

attached hereto as Exhibit "I," at 103 ("Exhibit "I," Menendez Transcript") (acknowledging that 

turnkey contract was contingent on lease); Exhibit "F," Timberlake Transcript, at 43 (same); 

Deposition Transcript of Theodore DelGaizo, August 27, 2003, attached hereto as Exhibit "J," at 

101-02 ("Exhibit "J," DelGaizo Transcript") (same).

 

3

 As will be described more fully below, in January 2001, Messer AGS (now Generon IGS, Inc.) assigned the Truro 

project to Engineered Gas Systems ("EGS"), a subsidiary of MLEA, Inc. See Exhibits "D" and "E." 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 8 of 29
6

 RTG also stated on several occasions during these early negotiations that it did not wish 

to own or manage any plant built for its Truro facility. See Deposition Transcript of Martin 

Sergi, November 14, 2003, attached hereto as Exhibit "K," at 118-19, 147-48 ("Exhibit "K," 

Sergi Transcript"); Exhibit "J," DelGaizo Transcript, at 85-86. Rather, ARR would consent to 

having a plant built on-site, but operated by an outside vendor. 

 The parties exchanged numerous draft contracts is September and October 2000, but no 

agreement was ever executed by any defendant. See Exhibit "I," Menendez Transcript, at 73; 

Exhibit "J," DelGaizo Transcript, at 33-34, 92; Exhibit "F," Timberlake Transcript, at 50. See 

also Trial Transcript from Generon IGS, Inc. v. Engineered Gas Systems, LLP, et al., Court of 

Common Pleas, Chester County, September 22–23, 2003, attached hereto as Exhibit "L," at 149, 

152-53, 174, 186 (in a related case, Messrs. DelGaizo and Menendez repeatedly testified that 

neither ARR nor RTG ever entered into a formal turnkey contract with Messer, MLEA or EGS). 

In October 2000, RTI – Canada circulated a Request for Proposal ("RFP") to a number of gas 

and energy companies requesting bids for the supply of liquid nitrogen to the Truro facility. A 

copy of the RFP sent to Messer is attached hereto as Exhibit "M." 

 RTI – Canada received at least three responses to the RFP, but ARR continued to 

negotiate with Messer. However, several major stumbling blocks prevented the parties from 

reaching agreement, including the size of the plant, Messer's insistence that ARR purchase the 

plant after construction, and Messer's inability to obtain suitable lease financing. See, e.g.,

Exhibit "C," Benison Transcript, at 42-43, 126-27 (parties were debating size of the plant in Fall 

2000). Indeed, on November 20, 2000, George Timberlake admitted, for the first time, that 

Messer was having a "great deal of trouble" with the lease. See Exhibit "N." Messer then 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 9 of 29
7

requested that RTG agree to purchase certain "long lead and critical use items" so that the 

suggested timetable for construction would be protected. Id.

 On December 1, 2000, upon Messer's request, ARR issued Purchase Order No. 715258 to 

Messer for three items: a cryogenic storage vessel, a feed breaker, and a transformer. See

Exhibit "O". The letter from ARR accompanying the purchase order clearly stated that the 

equipment would be returned to Messer if the lease did not proceed. See id. ("Should the lease 

not proceed, this equipment may and will be returned to Messer for full credit."). 

 Similarly, on December 12, 2000, ARR issued two more purchase orders (nos. 715260 

and 715261) (the "second purchase orders") to fund down payments on certain other equipment 

necessary for construction of the plant. See Exhibit "P" (Purchase Orders Nos. 715260 and 

715261). Again, the letter accompanying these purchase orders made clear that the equipment 

would be returned to Messer for full credit if the lease did not proceed. See id. 

 In January 2001, Messer assigned control and responsibility for the Truro project to 

EGS.4

 See Exhibits "D" and "E." As part of the transfer of the Truro project, EGS hired a 

number of former Messer employees who had been working on the project for Messer. See

Exhibit "I," Menendez Transcript, at 8-10, 12-13, 39-40. 

 In or around late February 2001, RTG requested that Rick Kelley, a Casella employee, 

assist ARR with the negotiations relating to the Truro project because he had experience with gas 

and energy companies. See Exhibit "B," Kelley Transcript, at 106. 5 Until this time, 

representatives of ARR alone had negotiated with EGS and had acted without Casella's 

 

4

 EGS was formed in January 2001 as a subsidiary of Main Line Engineering Associates of Exton, Pennsylvania 

("Main Line Engineering") to assume responsibility for the Truro project. See Exhibit "I," Menendez Transcript, at 

8-10; Exhibit "J" DelGaizo Transcript, at 20-24. Messer was disbanding the division of its company handling the 

Truro project, and EGS was formed by a number of former Messer employees. Id. MLEA, Inc. was incorporated as 

the parent company of both EGS and Main Line Engineering in January 2002. Id. EGS and Main Line Engineering 

are now divisions of MLEA. Id. 5

 Mr. Kelley is now an employee of RTG. See Exhibit "B," Kelley Transcript, at 11-13. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 10 of 29
8

supervision or direction. See Exhibit "I," Menendez Transcript, at 89-90, 99 (never dealt with a 

Casella employee until Rick Kelley got involved in February 2001); Exhibit "J," DelGaizo 

Transcript, at 114-17. By the time Mr. Kelley became involved, EGS had already issued 

purchase orders to vendors for the equipment for which it is now seeking damages. See Exhibit 

"Q." See also Exhibit "I," Menendez Transcript at 36-37. 

 In his first correspondence to Mr. Kelley regarding the Truro project, Mr. Timberlake 

admitted that EGS's "first problem . . . is that we do not have an order for the plant in Nova 

Scotia." See Exhibit "R" (emphasis added). Mr. Timberlake also admitted that EGS had not 

even applied for the necessary lease yet, and that EGS was "way over-committed." Id. 

(emphasis added). 

 Over the next several months, EGS continued to attempt to negotiate a contract with 

ARR. See Exhibit "I," Menendez Transcript, at 46-48; Exhibit "F," Timberlake Transcript, at 62-

63, 68. However, the parties did not reach an agreement on many of the essential terms, such as 

the size of the plant and the warranties. Id. and Exhibit "R."6 Although the parties never 

reached agreement, EGS continued to order equipment and perform engineering and design work 

without ARR's, RTG's or Casella's knowledge. 7

 RTI – Canada paid EGS $100,750.00 on March 9, 2001 as payment for EGS's January 

25, 2001 invoice for $100,750.00. See Exhibit "T" (copy of RTI – Canada check and EGS 

invoice). This invoice, which was directed to ARR, corresponded to the down payments for the 

 

6

 For example, EGS continued to propose a 30-ton capacity plant, even though representatives of ARR had 

repeatedly stated that it only needed a plant with a 15-ton capacity. See Exhibit "C," Benison Transcript, at 43-44. 

A 30-ton plant would have required ARR to purchase liquid nitrogen at a higher per pound price than a 15-ton plant 

and would have required ARR to sell the excess liquid nitrogen. Id. at 43-44, 68, 108-09. ARR consistently told 

EGS that it was not in the "gas-selling business", and wanted no part of a plant that would force it to sell liquid 

nitrogen. See Exhibit "J," DelGaizo Transcript, at 85-86. 7

 For example, in addition to the items included on the purchase orders, MLEA is claiming that ARR is also liable 

for certain equipment worth approximately $15,000 that was never included on the purchase orders. See Exhibit 

"S." EGS ordered the equipment from AMSCO Sales Corp. Id. This equipment was purchased without ARR's 

knowledge, and was not listed on ARR's purchase orders to EGS. See Exhibit "I," Menendez Transcript, at 32. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 11 of 29
9

feed breaker and transformer, and purchase and installation of the storage tank from the first 

purchase order. Id.

 In April 2001, plaintiff admitted that "[t]here never was a written contract or signed 

purchase order for the entire facility between Messer or Generon and ARR" in a letter to MG 

Generon, one of its vendors. See Exhibit "U". EGS further admitted that "[s]ince January 

[2001], we have finished the facility design and have ordered essentially all the equipment in 

spite of the fact that we have yet to obtain a written contract or signed PO for the facility, and 

have been paid on only the smaller of the two initial POs." Id. (emphasis added). Mr. DelGaizo 

also admitted that the "[Truro] project . . . has collapsed." Id.

 During the spring and summer of 2000, EGS continued to send ARR drafts contracts. On 

at least one occasion, in April 2001, EGS forwarded an executed copy of a proposed contract to 

RTG. See Exhibit "V", at 17. None of these proposals were ever agreed to or signed by RTG or 

ARR. Nor were any of these proposals ever directed to Casella. EGS continued to negotiate 

with RTG through April 2002. 

III. LEGAL ARGUMENT

A. The Standard For Granting Summary Judgment

 Summary judgment is proper where there is no genuine issue as to any material fact, and 

the moving party is entitled to judgment as a matter of law. Adena, Inc. v. Cohn, 2002 WL 

1832839, Civ. A. No. 00-3041 (E.D. Pa. Aug. 7, 2002) (McGirr Kelly, S.J.). As this Court has 

explained, Rule 56 "requires the entry of summary judgment 'after adequate time for discovery . . 

. against the party who fails to make the showing sufficient to establish the existence of an 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 12 of 29
10

element essential to that party's case, and on which that party will bear the burden of proof at 

trial.'" Id. (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986)). 

 Once the moving party establishes the absence of a genuine issue of material fact, the 

burden shifts to the non-moving party "to do more than simply show that there is some 

metaphysical doubt as to the material fact." Bailey v. United Airlines, Inc., 101 F. Supp. 2d 311, 

315 (E.D. Pa. 2000) (Reed, S.J.) (citing, Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 

475 U.S. 574, 586 (1986)). To meet this burden, the non-moving party may not rely merely upon 

bare assertions, conclusory allegations, or suspicions, Id. (citing, Fireman's Ins. Co. v. Du 

Fresne, 676 F.2d 965, 969 (3d Cir. 1982)). 

 Although the movant has the initial burden of demonstrating the absence of a genuine 

issue of material fact, the non-movant must then establish the existence of each element on 

which it bears the burden of proof. J.F. Feeser, Inc. v. Serv-A-Portion, Inc., 909 F.2d 1524, 

1531 (3d Cir. 1990) (citing Celotex, 477 U.S. at 323). The non-moving party may not rest on his 

pleadings but must come forward with competent evidence from which a reasonable jury could 

return a verdict in his favor. Anderson, 477 U.S. at 248. 

B. Applicable Law

It is undisputed that the parties never entered into a turnkey contract. Accordingly, no 

express choice of law provision exists in this lawsuit. Various drafts of the proposed contract 

included choice of law provisions for the laws of Nova Scotia, Pennsylvania and New York. 

 Pennsylvania courts apply a hybrid conflict of interest analysis, which combines the 

approach of the Restatement (Second) of Conflict of Laws, known as the "most significant 

relationship" test, and the theory known as "governmental interest analysis." Celebre v. 

Windsor-Mount Joy Mutual Ins. Co., 1994 WL 13840, No. Civ. A. 93-5212, at *2 (E.D. Pa. Jan. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 13 of 29
11

14, 1994) (Cahn, J.). The object of this analysis is to "determine which jurisdiction has the 

greater interest in the application of its law." Teledyne Techs. Inc. v. Freedom Forge Corp., No. 

3398 May Term 2000, 2002 WL 748898, at *4 (Phila. CCP April 19, 2002) (citations omitted). 

 In a contract action, courts review the following factors: place of contracting, place of 

negotiations, place of performance, where the subject matter of the contract is located and the 

place of incorporation and place of business of the parties. Benevento v. LIFE USA Holding, 

Inc., 61 F. Supp.2d 407, 414-15 (E.D. Pa. 1999) (Joyner, J.). Based on these factors, as well as 

Pennsylvania's interest in protecting its corporate entities, such as MLEA, for purposes of this 

motion only, Casella assumes that Pennsylvania law would apply. 

C. Casella Is Not Liable For Any Damages In This Lawsuit

MLEA's claim that Casella can be held liable for any alleged liability of ARR is directly 

contrary to governing Pennsylvania law, which provides that piercing the corporate veil is an 

extraordinary remedy that should be invoked only when justice permits no other alternative. 

Both this Court and the Supreme Court of Pennsylvania have repeatedly explained that 

piercing a corporation's veil is an extraordinary remedy reserved for the exceedingly rare 

situation in which the existence of the corporate form was used to defraud, and justice demands 

the remedy's invocation. Ziegler v. Delaware County Daily Times, 128 F. Supp.2d 790 (E.D. Pa. 

2001) (Dalzell, J.) ("In Pennsylvania, there is a strong presumption against piercing the corporate 

veil."); Lumax Indus., Inc. v. Aultman, 669 A.2d 893, 895 (Pa. 1995) (same); Sams v. 

Redevelopment Auth., 244 A.2d 779, 781 (Pa. 1968) ("The corporate entity or personality will be 

disregarded only when the entity is used to defeat public convenience, justify wrong, protect 

fraud or defend crime."). Compare United States v. Best Foods, 524 U.S. 51, 55-56 (1998) 

(holding a parent liable for the actions of a subsidiary is the exception rather than the rule). 

Under Pennsylvania law, a subsidiary is generally regarded as a "separate and independent 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 14 of 29
12

entity" from the parent corporation. Commonwealth v. Vienna Health Prods., Inc., 726 A.2d 

432, 434 (Pa. Commw. 1999). Accordingly, a parent corporation is not generally liable for the 

contractual obligations of a subsidiary, even if the parent wholly owns the subsidiary. Quandel 

Group v. Chamberlin Co., Inc., Civ. A. No. 98-5762, 1999 WL 386602, at *2 n. 1 (E.D. Pa. June 

14, 1999) (Waldman, J.) (citing Botwinick v. Credit Exch., Inc., 213 A.2d 349, 353 (Pa. 1965)). 

Pennsylvania law allows the corporate form to be disregarded in limited situations where 

there is gross undercapitalization of the subsidiary, failure to adhere to corporate formalities, 

substantial intermingling of various corporate affairs, and the use of the corporate form to 

perpetrate a fraud. Saint Joseph Hosp. v. Berks County Board of Assessments, 709 A.2d 928 (Pa. 

Commw. 1998) (citations omitted). None of these factors applies here. Other factors that are 

relevant under Pennsylvania law to establish alter-ego liability include: non-payment of 

dividends; siphoning of funds from subsidiary by dominant shareholders; non-functioning of 

other officers and directors; and absence of corporate records. Lumax, 669 A.2d at 895. 

The reason why piercing a corporation's veil is limited to the exceptional case is obvious. 

A principal goal of organizations that operate using the corporate form is to limit the 

corporation's liability to the assets that are invested in the corporation. Indeed, in Wedner v. 

Unemployment Compensation Bd. of Review, 296 A.2d 792, 794-95 (Pa. 1972), the Pennsylvania 

Supreme Court quoted with approval from a ruling of the U.S. Court of Appeals for the Third 

Circuit that stated: 

In applying this test [for piercing the corporate veil], however, any court 

must start from the general rule that the corporate entity should be 

recognized and upheld, unless specific, unusual circumstances call for an 

exception. . . . . Care should be taken on all occasions to avoid making the 

entire theory of the corporate entity * * * useless. 

Id. at 795 (citing Zubik v. Zubik, 384 F.2d 267, 273 (3d Cir. 1967), cert. denied, 390 U.S. 988 

(1968)) (internal quotations omitted). 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 15 of 29
13

Additionally, the law recognizes that the corporate veil may more readily pierced when 

involuntary creditors are involved than when the claims of voluntary creditors are at stake. See, 

e.g., Miners, Inc. v. Alpine Equip. Corp., 722 A.2d 691, 695 (Pa. Super. 1998) (recognizing this 

distinction between voluntary and involuntary creditors), alloc. denied, 745 A.2d 1223 (Pa. 

1999). An example of an involuntary creditor of a corporation is someone who has a tort claim 

against the company as the result of having been injured by the company's allegedly negligent 

business practices. For example, someone who is injured in a collision with a truck would 

qualify as an involuntary creditor of the trucking company. An example of a voluntary creditor, 

by contrast, is someone who voluntarily agrees to enter into a contractual relationship with a 

trucking company. Such a voluntary creditor has the option to choose both whether and with 

whom to contract, and voluntary creditors can require that a debtor provide security for the debt. 

MLEA is undoubtedly a voluntary creditor in this case. 

A plaintiff bears the burden of proof, and must meet a very high threshold, in order to 

establish that the court should pierce the corporate veil. See Garden State Tanning, Inc. v. 

Mitchell Mfg. Group, Inc., 55 F.Supp.2d 337, 344 (E.D. Pa. 1999) (Katz, S. J.). The parent must 

be shown to have a complete domination of not only finances, but of policy and business practice 

with respect to the transaction. 

The principal issue presented in this case could not be more straightforward. In the fall 

of 2000, MLEA attempted to enter into a turnkey contract with defendant ARR. See Exhibit "J," 

DelGaizo Transcript, at 28-29, 101, 104. Additionally, plaintiff, although aware that RTG, and 

possibly Casella, were located up the corporate ladder, chose to contract with ARR. See Exhibit 

"F," Timberlake Transcript, at 178-79 (admitted that he knew that ARR and RTG were whollyowned subsidiaries of Casella, and that Casella did not guarantee any action by ARR or RTG); 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 16 of 29
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Exhibit "L," Trial Transcript, at 146-47, 181 (Messrs. Menendez and DelGaizo testified that 

they knew ARR was a subsidiary of RTG). Further, MLEA accepted the purchase orders from 

ARR alone on two separate occasions, and did not request a guarantee or any other 

acknowledgement from RTG, RTI – Canada or Casella. Id. Further, at this early stage of the 

negotiations, Casella was not involved in this project. See Exhibit "B," Kelley Transcript, at 31 

("Casella wasn't involved in the ARR programs at all."). 

At the time MLEA was negotiating the proposed turnkey contract with ARR, RTI – 

Canada owned ARR. See Exhibit "W; " Exhibit "A," Bohlig Transcript, at 23. And at that same 

time, defendant RTG owned RTI – Canada. Id. Thus, Casella was essentially three rungs up the 

corporate ladder from ARR. 

Q. Just so I understand this chart, again, we're on the April 30, 2001 chart, 

does the solid line that runs from Recovery Technologies Group, Inc., to 

Recovery Technologies Canada, Inc., does that indicate that the Recovery 

Technologies Canada, Inc., is a wholly owned subsidiary of Recovery 

Technologies Group, Inc.? 

A. Recovery Technologies Canada, Inc., was held by Recovery 

Technologies Group, Inc., and I believe that Atlantic Recycled Rubber was 

wholly owned and, and held by Recovery Technologies, Canada. 

Q. When you said that Recovery Technologies Canada, Inc., was held by 

Recovery Technologies Group, Inc., did you also mean that to mean a 

wholly owned subsidiary of Recovery Technologies Group, Inc.? 

A. I, I believe that that is -- I believe that this chart attempted to reflect both 

organizational space as well as how the entities were actually held. 

Q. And so is it your understanding that the Recovery Technologies Canada, 

Inc., as of this date was wholly owned by Recovery Technologies Group, 

Inc.? 

A. I believe it was. 

Q. Same question or similar question actually. Was Recovery 

Technologies Group, Inc., wholly owned by Casella Waste Systems, Inc., as 

of April 30, 2001? 

A. Yes. 

Exhibit "A," Bohlig Transcript, at 23-24. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 17 of 29
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Plaintiff voluntarily chose to accept the purchase orders from ARR, and plaintiff obtained 

in return no security from RTG, let alone RTI - Canada or Casella, to ensure payment of ARR's 

obligations to it. See Exhibits "O" and "P." See also Exhibit "F," Timberlake Transcript, at 178-

79. A plaintiff such as MLEA who has voluntarily entered into contractual relations with one 

company cannot be permitted to hold that company's great-grandparent corporation liable 

without having demonstrated any evidence whatsoever to justify piercing the corporate veil of 

that corporation. 

Pennsylvania law does not permit plaintiff to hold Casella liable simply because its 

corporate "great-grandchild", ARR, may have owed money to the plaintiff. No facts warrant 

piercing the corporate veil to reach RTG, let alone Casella. Accordingly, this Court should grant 

Casella's motion for summary judgment and dismiss MLEA's claims against defendant Casella in 

their entirety. 

D. MLEA Is Not Entitled To Damages Flowing From Its Preparation Of 

Engineering Plans/Drawings

MLEA claims that defendants breached a contract for MLEA to "create plans, including 

foundation plans, and equipment specifications for the Truro Facility." [Complaint, ¶18]. 

Plaintiff further claims that defendants owe $234,050.00 and $81,864.00, respectively, for these 

so-called "design/specifications/drawings" and "process design/specifications," that were 

completed by MLEA. See Exhibit "S." However, neither ARR nor RTG ever authorized or 

agreed to MLEA's design of these plans. As Casella was not involved in the project at that point, 

as described above, it could not have given approval to prepare these engineering plans. 

MLEA also claims that it can somehow recover from defendants for these engineering 

plans based on the equitable theories of promissory estoppel and unjust enrichment. Plaintiff 

cannot recover on either theory, as will be shown below. 

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1. The Parties Never Entered Into Any Agreement Regarding The 

Engineering Plans

MLEA cannot recover for the engineering plans under a breach of contract theory 

because no contract or agreement ever existed between the parties regarding these plans. Indeed, 

Manuel Menendez, one of MLEA's owners and its Vice-President of Engineering, has testified 

that no one from ARR or RTG "ever agree[d] to pay for the services that went into" the 

engineering plans. See Exhibit "I," Menendez Transcript, at 93-94. 

It is black letter law that in order to form an enforceable contract, there must be an offer, 

acceptance, consideration or mutual meeting of the minds. See Jenkins v. County of Schuylkill, 

658 A.2d 380, 384 (Pa. Super. 1995) (citing cases). A breach of contract claim requires proof 

that the defendant breached a duty imposed under the contract, and further proof of actual loss 

resulting from the defendant's alleged breach. See, e.g., Corestates Bank, N.A. v. Cutillo, 723 

A.2d 1053, 1058 (Pa. Super. 1999) (claim for breach of contract must be established by pleading 

(1) the existence of a contract, including its essential terms, (2) a breach of a duty imposed by the 

contract and (3) resultant damages). 

Under Pennsylvania law, contracts are enforceable when the parties reach a mutual 

agreement, exchange consideration, and set forth the terms of their bargain with sufficient 

clarity. See SDK Investments, Inc. v. Ott, No. Civ. A. 94-111, 1996 WL 69402, at *6 (E.D. Pa. 

Feb. 15, 1996) (Giles, J.). Similarly, "the test for enforceability of an agreement is whether both 

parties have manifested an intention to be bound by its terms and whether the terms are 

sufficiently definite to be specifically enforced." Channel Home Ctrs. v. Grossman, 795 F.2d 

291, 298-99 (3d Cir. 1986) (relying on and citing Pennsylvania cases). This is clearly not the 

case here. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 19 of 29
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Indeed, all three of MLEA's witnesses concur that the parties never agreed to the terms of 

any turnkey contract. See Exhibit "I," Menendez Transcript, at 73; Exhibit "F," Timberlake 

Transcript, at 189 ("I didn't believe that we had an order for a turnkey plant."); Exhibit "J," 

DelGaizo Transcript, at 33-34. Moreover, two of these principals, Messrs. Menendez and 

DelGaizo, testified during trial in a related case that ARR did not sign a turnkey contract with 

Messer, MLEA or EGS. See Exhibit "L," Trial Transcript at 149,152-53, 174. In fact, under 

questioning from the Honorable Jacqueline C. Cody, Mr. DelGaizo admitted that MLEA 

accepted the transfer of the Truro project from Messer knowing that "there was no signed 

contract for this [Truro] project." Id. at 174-75. 

Plaintiffs have also repeatedly admitted that the parties reached no agreement regarding 

the engineering plans: 

Q. Your counsel has produced with you today what we've marked as 

DelGaizo-1, 2 and 3 which are construction drawings and some specifications. 

. . . Did anyone from ARR or RTG ever agree to pay for the services that 

went into those drawings --

A. No.

Q. -- or specifications?

A. No, but the point is without doing this work, you can't really order 

the equipment. I mean, in other words, until you know a lot of this 

information, including the specifications which you go out with on the 

purchase order, you know, you just can't order that in a vacuum, so there's a 

certain amount of this work that has to go on just to buy the equipment. 

Q. When you talk about buying the equipment, are you referring to the 

equipment that was the subject of the purchase orders that were sent out in 

December and January? 

A. Yes. Right. 

* * * * * 

Q. At the time that you did the foundation drawings, was there an 

agreement by RTG or ARR to pay for your services in making those 

drawings? 

A. No.

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Exhibit "I," Menendez Transcript, at 93-96 (emphasis added). Mr. DelGaizo also admitted that 

no one from ARR or RTG ever agreed to pay for the services that went into the engineering 

plans. See Exhibit "J," DelGaizo Transcript, at 93-94. 

 Accordingly, there is no basis for a breach of contract claim regarding MLEA's claim for 

damages as to the "engineering plans," and MLEA's claim for recovery of the engineering plans 

should be dismissed. 

2. No Defendants Made Any Promise Regarding The Engineering Plans

MLEA also asserts that defendants are liable to pay for the engineering costs based on a 

promissory estoppel theory. 

 A cause of action for promissory estoppel arises when a party relies on a promise which 

could be reasonably be expected to influence the action or forbearance of a party. See Murphy v. 

Burke, 454 Pa. 391, 398 (1973) (applying the principles of the RESTATEMENT (SECOND) 

CONTRACTS §90); Rinehimer v. Luzerne Cty. Com. College, 539 A.2d 1298, 1306 (Pa. Super. 

1988). 

 In Pennsylvania, to support a claim based on promissory estoppel, the plaintiff must show 

that: 

1) the promisor made a promise that he should have reasonably expected to 

induce action or forbearance on the part of the promisee; 

2) the promisee actually took action or refrained from taking action in reliance 

on the promise; and 

3) injustice can be avoided only by enforcing the promise. 

Crouse v. Cyclops Indus., 745 A.2d 606, 610 (Pa. 2000). To recover under the theory of 

promissory estoppel a plaintiff must allege an express promise. An implied promise is 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 21 of 29
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insufficient to support a claim for promissory estoppel. Constar, Inc. v. National Distribution 

Center, Inc., 101 F.Supp.2d 319, 324 (E.D. Pa. 2000) (R. Kelly, J.) (applying Pennsylvania law).

 MLEA admits that neither Casella, nor RTG, ever expressly promised EGS to pay for the 

engineering plans, or to enter into a binding contract for their completion. Indeed, the two 

MLEA employees who primarily dealt with ARR during the relevant time period admit that their 

first dealings with Casella came in late February or early March 2001. See Exhibit "I," 

Menendez Transcript, at 43, 90, 99; Exhibit "F," Timberlake Transcript, at 49-50, 67-68. See 

also Exhibit "B," Kelley Transcript, at 95-96. The engineering plans were completed by that 

date. See Exhibit "I," Menendez Transcript, at 93.

Casella was not involved in these negotiations until February 2001, and, even then, only 

on a very limited basis. EGS had already ordered the equipment at issue in this litigation by that 

time, and had mostly completed the engineering and design work. Moreover, no Casella 

employee ever made any promise that MLEA can claim to have relied on to its detriment. 

3. Casella Was Not Unjustly Enriched By MLEA's Services

MLEA also claims that it should be rewarded for its engineering services under a theory 

of unjust enrichment. 

Pennsylvania law provides that "[a] person who has been unjustly enriched at the expense 

of another is required to make restitution to another." D.A. Hall Co. v. Clevertrust Realty 

Investors, 573 A.2d 1005 (Pa. 1990) (citing RESTATEMENT OF RESTITUTION § 1). To assert an 

unjust enrichment claim, a plaintiff must allege that (1) it conferred a benefit on the defendant, 

(2) the defendant appreciated the benefit, and (3) it would be inequitable for the defendant to 

accept and retain the benefit without paying the plaintiff for the value of the benefit conferred. 

Styer v. Hugo, 619 A.2d 347, 350 (Pa. Super. 1993), aff'd, 637 A.2d 276 (Pa. 1994). 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 22 of 29
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The unjust enrichment doctrine does not apply where the defendant may have benefited

as a result of the actions of the plaintiff. Meehan v. Cheltenham Township, 189 A.2d 593 (Pa. 

1963); Ameripro Search, Inc. v. Fleming Steel Co., 787 A.2d 988, 990 (Pa. Super. 2001). Thus, 

MLEA cannot merely allege its own loss as the measure of recovery. Instead, it must 

demonstrate that ARR or RTG or Casella in fact benefited from these services. See D.A. Hill, 

573 A.2d at 1009; Meehan, 189 A.2d at 595. MLEA cannot do this. 

MLEA certainly cannot argue that Casella was enriched by MLEA's engineering plans. 

First, ARR never constructed any liquid nitrogen-producing plant at the Truro facility, with or 

without the use of MLEA's plans to construct such a plant. Moreover, Casella had no use for 

the engineering plans and designs completed by EGS since it had divested itself of RTG and 

ARR by the time the plans were delivered. Compare supra footnote 2 (Casella sold RTG and 

ARR in August 2001) with Exhibit "J," DelGaizo Transcript, at 8-10 (engineering plans were 

delivered to ARR and RTG in September and October 2001). 

Further, no benefit ever could have been gained by any defendant because MLEA never 

delivered the entire set of the engineering plans and drawings to ARR or RTG. Indeed, Mr. 

Menendez testified that MLEA never delivered all of the engineering plans to ARR or RTG, and 

that the plant cannot be built, even now, without a full set of those plans: 

Q. As of September 14, 2001, with the plans that were provided in January 

or February and these foundation drawings, could RTG or ARR have built or 

manufactured the plant? 

A. No, not with those drawings. 

Q. What else was needed?

A. They needed the remainder of the detailed piping drawings.

Q. What? 

A. The piping drawings. 

Q. That's a piping drawing? 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 23 of 29
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A. The piping that goes from one piece of equipment to another, the 

plumbing. 

* * * * * 

Q. So besides the piping drawings there was a lot of other material that was 

not provided that was needed to build, to manufacture the plant? 

MR. KATAUSKAS: I thought the question was what was provided. 

MR. MCCORMICK: What was not provided. 

THE WITNESS: Certain specifications were not given to them; electrical 

drawings, piping drawings, equipment layout -- actually some equipment 

layout they did get. That's the majority of it, that's what encompasses a design 

for a plan. 

BY Mr. MCCORMICK: 

Q. The material that is not provided to RTG and ARR, was that 

necessary to construct the plant?

A. Yes. 

Exhibit "I," Menendez Transcript, at 94-96 (emphasis added). See also Exhibit "J," DelGaizo 

Transcript, at 109 ("Again, there might have been drawings being passed back and forth for 

comment, but some of them have still never been delivered. The electrical drawings are still at 

my place. And the reason that they really never were delivered is they never were totally 

finished either.") (emphasis added). Mr. Menendez testified that ARR could not construct the 

plant with the incomplete set of plans/designs provided by MLEA. Id.

 Thus, MLEA's own Vice-President of Engineering has admitted that (1) there never was 

an agreement by RTG or ARR to pay for MLEA's services in assembling the engineering plans, 

(2) Casella never promised to pay for the engineering plans, (3) certain plans and drawings were 

never delivered to ARR, and (4) the liquid nitrogen plant could not be constructed with the plans 

as drawn. Accordingly, MLEA cannot recover for the cost of the engineering plans, and they 

must be stricken from MLEA's request for damages. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 24 of 29
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E. MLEA's Recovery Is Limited To The Amounts Listed In The Purchase 

Orders

Plaintiff repeatedly claims that the only written contracts that exist between the parties 

are the three purchase orders issued by ARR. Two of these purchase orders and the invoice sent 

out by MLEA relating to the first purchase order reference only prices for down payments. 

However, MLEA claims that it is owed the full purchase price for each piece of equipment. 

As stated above, in order to form an enforceable contract, there must be an offer, 

acceptance, consideration or mutual meeting of the minds. See Jenkins, 658 A.2d at 384. "It is 

also well-settled that '[a]bsent a manifestation of an intent to be bound, however, negotiations 

concerning the terms of a possible future contract do not result in an enforceable contract." Id.

(citations omitted). 

The first essential of any contract is the existence of a "definite and certain" promise or 

an offer to enter into a contract. See GMH Assocs., Inc. v. The Prudential Realty Group, 2000 

WL 228918, at *6 (Pa. Super. Mar. 1, 2000) (citation omitted). See Ingrassia Constr. Co., Inc. v. 

Walsh, 486 A.2d 478, 484 (Pa. Super. 1984) (stating that "[a] court cannot enforce a contract 

unless it can determine what it is.") (quoting I A. CORBIN, CORBIN ON CONTRACTS § 95 (1963)). 

If the existence of an informal or oral contract is alleged, "it is essential to the enforcement of 

such an informal contract that the minds of the parties should meet on all the terms as well as the 

subject matter." GMH Assocs., 2000 WL 228918, at *7. See also Courier Times, Inc. v. United 

Feature Syndicate, Inc., 445 A.2d 1288, 1295 (Pa. Super. 1982). It is well-settled that since an 

offer to form the basis of a contract must be so complete that on acceptance an agreement is 

formed which contains all the terms necessary to determine whether the contract has been 

performed or not, there is no contract where the price is not determined. Butler v. Kemmerer, 67 

A. 332 (PA. 1907); Beachler v. Mellon-Stuart Co., 47 A.2d 147, 149 (Pa. 1946) (price is an 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 25 of 29
23

essential element of a contract, and price must be sufficiently definite or capable of 

ascertainment from contract). 

Applying these principles here, this Court must find that the record fails to establish that 

the parties had reached an enforceable agreement that ARR would pay MLEA for the entire price 

of the equipment. It is undisputed that the parties had never entered into a written agreement for 

the turnkey project. See Exhibit "I," Menendez Transcript, at 73; Exhibit "J," DelGaizo 

Transcript, at 92; Exhibit "R" ("Our first problem is that we do not have an order for the plant in 

Nova Scotia."). It is also undisputed that no essential terms as to the price, delivery dates or size 

of the plant were ever established. See Exhibit "I," Menendez Transcript, at 46; Exhibit "F," 

Timberlake Transcript, at 186-87; Exhibit "J," DelGaizo Transcript, at 93. Additionally, Messrs. 

DelGaizo and Menendez testified that the descriptions of the equipment in the ARR purchase 

orders were so incomplete that MLEA had to recreate them so as to order the equipment from the 

vendors. See Exhibit "L," Trial Transcript, at 154-55, 177. 

All that exist are purchase orders and invoices reflecting certain amounts for the 

equipment. See Exhibit "L," Menendez Transcript, at 25, 29; Exhibit "F," Timberlake 

Transcript, at 161-63, 168-69, 177. Even Mr. Timberlake admitted that the down payments in 

the second purchase orders did not correspond to any certain figure: 

These items have been evaluated to the minimum down payment for which 

the suppliers are willing to begin work. For example the compressors are at 

20%, some items are more some are less. . . . The total down payment for 

these items not including freight or installation for any of the items: 

$298,000. . . . Please note that no taxes of any kind have been included. 

See Exhibit "X" (emphasis added). See also Exhibit "R" ("We do have two limited orders which 

together constitute approximately 10% of the value of the plant.") (emphasis added); Exhibit "F," 

Timberlake Transcript at 168-69 (admitting that there were no discussions with anyone at ARR 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 26 of 29
24

or RTG regarding entering into agreements for amounts above the down payments in the 

purchase orders). 8 

It is clear here that there was no meeting of the minds as to the final price and terms of 

the purchase orders. The purchase orders contain full value for some items (PO no. 715258) and 

only down payments for other items (PO nos. 715260 and 715261). See Exhibit "I," Menendez 

Transcript, at 25, 29. If one were to calculate the amount listed on the purchase order as a down 

payment for MLEA's claimed damages it would show that the down payments listed on purchase 

order nos. 715260 and 715261 range from seven percent of the purchase price (membrane 

system) to 58% of the purchase price (electrical package/transformers). Compare Exhibit "P" 

with Exhibit "S." In addition, the EGS/MLEA invoice that corresponds to purchase order no. 

715258 lists only the down payment amount as due and owing. Compare Exhibit "O" and "T" 

(purchase order states one price, and invoice states a different price). 

It is clear that there was no complete, definite purchase price for the majority of the 

pieces of equipment listed on the three purchase orders at issue. Indeed, Mr. Timberlake's own 

letter indicates that the down payment amounts in the second purchase orders themselves do not 

contain any relation to the final, unknown purchase price. See Exhibit "X." Accordingly, since 

ARR only agreed to pay the down payment amounts, and 

IV. CONCLUSION

For all the foregoing reasons, defendant Casella Waste Systems, Inc., respectfully 

requests that the Court grant its motion for summary judgment, and dismiss the claims against 

Casella in their entirety. Alternatively, Casella requests that the Court grant its motion for partial 

 

8

 Additionally, Mr. Timberlake told ARR that one of the largest items, the high-pressure membrane, was in stock, 

and only needed to be kept on "skids" at the manufacturer, and not ordered. See Exhibit "Y." See also Exhibit "F," 

Timberlake Transcript, at 138-39. Mr. Timberlake never told ARR that it was ordering a specially-manufactured 

item worth $475,000. In fact, Mr. Timberlake never informed ARR of the full purchase price amount before the 

purchase orders were created. 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 27 of 29
25

summary judgment and (1) dismiss plaintiff's claims for damages as to the engineering plans, 

and (2) limit plaintiff's damages to the amounts listed in the three purchase orders at issue. 

 

 ____________________________ 

Antoinette R. Stone, I.D. No. 23464 

Brian J. McCormick, Jr., I.D. No. 81437 

BUCHANAN INGERSOLL PC 

1835 Market Street, 14th Floor 

Philadelphia, PA 19103 

(215) 665-8700 

(215) 665-8760 (fax) 

Attorneys for Defendant Casella Waste 

Systems Inc. 

Dated: February 10, 2004 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 28 of 29
CERTIFICATE OF SERVICE

 I, Brian J. McCormick, Jr., hereby certify that on February 10, 2004, I caused to be 

served a true and correct copy of the foregoing Motion for Summary Judgment via first-class 

mail upon the following: 

Philip J. Katauskas 

Pepper Hamilton LLP 

3000 Two Logan Square 

18th & Arch Streets 

Philadelphia, PA 19103-2799 

John F. O'Riordan 

Eckert Seamans Cherin & Mellott, LLC 

1515 Market Street, Ninth Floor 

Philadelphia, PA 19102 

 

 Brian J. McCormick, Jr. 

#617310-v3;PHL1_General; 

Case 2:02-cv-04393-JS Document 18 Filed 02/10/2004 Page 29 of 29