UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF OHIO

WESTERN DIVISION AT DAYTON

WCR, INCORPORATED,

Plaintiff,

vs.

WESTERN CANADA PLATE 

EXCHANGER, LTD.,

Defendant.

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Case No. 3:18-cv-00278

District Judge Thomas M. Rose

Magistrate Judge Sharon L. Ovington

REPORT AND RECOMMENDATIONS1

In this case, Plaintiff WCR, Inc. seeks to impose liability on Defendant Western 

Canada Plate Exchanger Ltd. (Western Canada Plate) for breach of contract. In a second 

and more expansive case, Plaintiff WCR, Inc. seeks to impose liability on a similarly

named Defendant—Western Canada Heat Exchanger, Ltd. (Western Canada Heat)—and 

its owner Earl Strohschein for fraud, breach of contract, reformation, and unjust 

enrichment. WCR, Incorporated v. Western Canada Heat Exchanger, Ltd., et al., 

3:20cv00143 (S.D. Ohio). The instant case is before the Court upon Plaintiff WCR’s 

Motion to Consolidate (Doc. No. 38), Defendant’s Memorandum in Opposition (Doc. 

No. 41), WCR’s Reply (Doc. No. 44), and the record as a whole.

WCR argues that consolidation of the two cases—WCR I and WCR II (for ease of 

reference)—is warranted under Fed. R. Civ. P. 42(a) because the cases involve 

1 Attached is a NOTICE to the parties regarding objections to this Report and Recommendations.

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substantially the same parties and common questions of law and fact. WCR maintains 

that the common questions concern the same alleged fraudulent scheme perpetrated by 

Western Canada Plate and Western Canada Heat at the direction of Earl Strohschein—

who is the owner of each entity. WCR also alleges that Strohschein improperly formed, 

intermingled, and operated Western Canada Heat as the alter ego of Western Canada 

Plate.

Western Canada Plate contends that consolidation of WCR I and WCR II is

unwarranted because (1) the cases involve different parties, different claims, and different 

evidence; (2) the cases were filed years apart from each other; (3) WCR improperly seeks 

consolidation, in part, to compensate for its own procedural missteps; and (4) each case 

has its own technical issues including discovery disputes in the instant case and threshold 

jurisdictional issues now pending in WCR II.

Rule 42(a) controls consolidation through its requirement of “a common question 

of law or fact ....” The goal “is to administer the court’s business ‘with expedition and 

economy while providing justice to the parties.’” Advey v. Celotex Corp., 962 F.2d 1177, 

1180 (6th Cir. 1992) (citation omitted); see Guild Associates, Inc. v. Bio-Energy 

(Washington), LLC, 309 F.R.D. 436, 439 (S.D. Ohio 2015) (Marbley, J). To secure 

justice to the parties, “‘[c]are must be taken that consolidation does not result in 

unavoidable prejudice or unfair advantage.’” Cantrell v. GAF Corp., 999 F.2d 1007, 

1011 (6th Cir. 1993) (citation omitted). If consolidation would leave minimal savings of 

judicial resources, “the risk of prejudice to a party must be viewed with even greater 

scrutiny.” Id. And when common questions of law or fact exist, the decision to 

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consolidate considers:

[W]hether the specific risks of prejudice and possible confusion [are] 

overborne by the risk of inconsistent adjudications of common factual and 

legal issues, the burden on parties, witnesses and available judicial

resources posed by multiple lawsuits, the length of time required to 

conclude multiple suits as against a single one, and the relative expense to 

all concerned of the single-trial, multiple-trial alternatives.

Id. (citation omitted); see Dreher v. Eskco, Inc., 3:08–cv–325, 2009 WL 2176060, at *3 

(S.D. Ohio 2009) (Rose, J).

WCR I and WCR II share common questions of law and fact concerning whether 

Western Canada Plate violated the exclusivity terms in a 2017 Service Center Agreement. 

WCR’s complaint in WCR I alleges that Western Canada Plate breached the Agreement 

(1) by not paying for goods it ordered from WCR; (2) by not selling, using, and installing 

only WCR products (or other Plate Products approved by WCR); and (3) by not engaging 

in the sale of products similar to WCR’s products or providing services similar to those 

WCR provides.” (WCR I, Doc. No. 1, ¶ 17). These same allegations arise in, and are 

integral to, WCR II where the Complaint alleges:

WCR was damaged as a result of Strohschein’s control over WCPE 

[Western Canada Plate Exchanger] and WCHE [Western Canada Heat

Exchanger] and his deceptive and fraudulent use of them to deprive WCR 

of sales and the ability to have another, honest, distributor in the territory 

such that maintaining the corporate formalities would work an injustice 

upon WCR.

(WCR II, Doc. No. 1, ¶ 69).

Further commonality emerges from Strohschein’s control over Western Canada 

Plate and Western Canada Heat. In WCR I, Plaintiff says that Strohschein owns Western 

Canada Plate and is its sole voting shareholder and director. (WCR I, Doc. No. 1, ¶ 3). In 

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WCR II, Plaintiff alleges that “Strohschein identifies himself as the Owner of [Western 

Canada Heat], runs its day-today operations, and has sent and directed numerous 

communications on its behalf to WCR in Ohio. Strohschein is also the ‘President’ of the 

nearly identically named [Western Canada Plate].” (WCR II, Doc. No. 1, ¶ 8). WCR 

alleges in WCR II, “Strohschein caused [Western Canada Plate] to enter into the Service 

Center Agreements with WCR in Ohio, but then ordered goods using the [WesternCanada-Heat] name, which Strohschein then caused [Western Canada Heat] and

[Western Canada Plate] to not pay for.” Id. at ¶ 29. More colloquially, by pulling the 

strings of both entities, Strohschein allegedly masterminded the situation that leads to 

WCR’s breach-of-contract claim in WCR I and its fraud claims against both entities in 

WCR II as well as its contract-reformation claim (which aims to add Western Canada 

Heat to the 2017 Security Center Agreement) and its unjust-enrichment claim in WCR II. 

WCR’s counsel, moreover, cogently asserts, “the companies have substantially similar 

names, the same employees and physical address and offices, the same purpose and 

function, and both are operated by Strohschein interchangeably, with no attempt to follow 

corporate formalities, such that they are effectively the same entity.” (WRC I, Doc. No. 

38, PageID 348).

Additional common questions of law and fact concern WCR’s allegations that the 

2017 Service Center Agreement required Western Canada Plate and Western Canada

Heat to purchase goods exclusively from WCR, and prohibited both entities (or their 

shareholders) from owning an interest in any competing venture. Thus, both cases 

explore whether or to what extent Strohschein wrongly caused Western Canada Plate or 

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Western Canada Heat to purchase goods in contravention of the 2017 Service Center 

Agreement, and whether Strohschein caused Western Canada Plate or Western Canada 

Heat to fail to pay WCR for custom-manufactured goods ordered from WCR.

It is reasonable to wonder, in light of the above commonalities, why WCR only 

sued Western Canada Plate in WCR I. The WCR II Complaint explains this. WCR

reports that Western Canada Plate “was the only named defendant in ... [WCR I] because 

that was the entity identified in the Service Center Agreements and because Western 

Canada Plate had used the name ‘Western Canada Heat Exchanger’ interchangeably with 

‘Western Canada Plate Exchanger,’ and further because WCR had yet to fully discover 

the fraud committed by Earl Strohschein personally and through [Western Canada 

Heat].” (WCR II, Doc. No. 1, ¶ 53). “After WCR commenced the Litigation against 

[Western Canada Plate], [Western Canada Heat] refused to produce documents that 

would identify the purchases made by [Western Canada Heat] in order to circumvent the 

Current Service Center Agreement, now claiming the two companies were separate.” Id. 

at ¶ 54 (emphasis added). Of course, to date, these allegations have not proved true or 

false. Still, they serve for now to illuminate commonality.

Western Canada Plate contends that consolidation risks conflating claims and 

causing prejudice. It accurately describes WCR claim in WCR I as a single 

straightforward breach-of-contract claim. But there is nothing inordinately difficult about 

keeping this single straightforward claim separate from the claims in WCR II. Judicial 

experience teaches that breach-of-contract claims and fraud claims often arise in a single 

case without conflation or confusion. The risk of conflation or confusion is low even 

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when such cases involve multiple defendants facing different claims. In the present case, 

consolidation will help clarify, rather than conflate or confuse, to whom liability (if any) 

attaches. Cf. Rodriguez v. Passinault, 637 F.3d 675, 689 n.6 (6th Cir. 2011)

(“‘Consolidation ... does not merge the suits into a single cause, or change the rights of 

the parties or make those who are parties in one suit parties in another.’” (quoting Kraft, 

Inc. v. Local Union 327, Teamsters, 683 F.2d 131, 133 (6th Cir. 1982))). And, if any 

significant confusion or prejudice emerges from consolidation, the Court retains 

discretion to order separate trials on the claim in WCR I and the claims in WCR II. See

Fed. R. P. 42(b).

Western Canada Plate contends that consolidation is unwarranted because these 

two cases involve different parties, different claims, and different evidence. These points 

do not assist Western Canada Plate. The differences between Western Canada Plate and

Western Canada Heat might well turn out to be minimal or nonexistent, in light of 

WCR’s alter-ego theory and allegations that Strohschein allegedly (1) owns the former 

and is the owner or president of the latter, and (2) acted at different times on behalf of 

one or the other in connection with the 2017 Security Center Agreement. While the 

single claim in WCR I advances a theory different from the fraud theories in WCR II, the 

claims and evidence in both cases involve Strohschein’s alleged activities—activities that 

gave rise to the claims in both cases (in WCR’s view). Additionally, the reformation 

claim in WCR II concerns the contract at issue in WCR I—the 2017 Security Center 

Agreement. If that Agreement is reformed as WCR wants, Western Canada Heat might 

incur liability for breach of contract either alone or together with Western Canada Plate. 

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As a result, the reformation claim in WCR II is tied to, rather than different from, the 

breach-of-contract claim in WCR I. For these reasons, the purportedly different parties, 

claims, and evidence do not suffice to avoid consolidation.

Western Canada Plate’s reliance on the years between the filing of WCR I and II

along with WCR’s “own procedural missteps” are unavailing. Just short of nineteen 

months lapsed between the time WCR filed its two cases. No prejudice arises from this 

time lapse. Additionally, Strohschein’s alleged misconduct and WCR’s discovery of it, 

see supra, p. 5, accounts for the delay in filing WCR II. And WCR did not commit a 

procedural misstep by filing two cases rather than seeking to amend its Complaint in 

WCR I. Western Canada Plate offers no authority to conclude otherwise. (WCR I, Doc.

No. 41, PageID 451-52).

Lastly, Western Canada Plate contends that consolidation should not occur 

because each case has its own technical issues including discovery disputes in the instant 

case and threshold jurisdictional issues now pending in WCR II. Yet, consolidation will 

not merge or confuse these issues and will not prejudice Western Canada Plate or 

Western Canada Heat. Cf. Rodriguez, 637 F.3d at 689 n.6. Consolidation will instead set 

the cases on the same procedural path by way of a new scheduling order that will advance 

the interests of conserving judicial resources while providing justice to the parties.

Accordingly, WCR’s Motion to Consolidate is well taken.

IT IS THEREFORE RECOMMENDED THAT:

1. WCR’s Motion to Consolidate (Doc. No. 38) be granted; and

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2. The instant case be consolidated with WCR, Inc. v. Western Canada Heat 

Exchanger, Ltd., et al., 3:20cv00143.

October 20, 2020 s/Sharon L. Ovington

Sharon L. Ovington

United States Magistrate Judge

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NOTICE REGARDING OBJECTIONS

Pursuant to Fed. R. Civ. P. 72(b), any party may serve and file specific, written 

objections to the proposed findings and recommendations within FOURTEEN days after 

being served with this Report and Recommendations. Such objections shall specify the 

portions of the Report objected to and shall be accompanied by a memorandum of law in 

support of the objections. If the Report and Recommendation is based in whole or in part 

upon matters occurring of record at an oral hearing, the objecting party shall promptly 

arrange for the transcription of the record, or such portions of it as all parties may agree 

upon or the Magistrate Judge deems sufficient, unless the assigned District Judge 

otherwise directs. A party may respond to another party’s objections within 

FOURTEEN days after being served with a copy thereof. 

Failure to make objections in accordance with this procedure may forfeit rights on 

appeal. See Thomas v. Arn, 474 U.S. 140 (1985); United States v. Walters, 638 F.2d 947, 

949-50 (6th Cir. 1981). 

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