THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

PORTLAND DIVISION 

ROSS ISLAND SAl'ID & GRAVEL CO., 

Plaintiff: 

v. 

LEHIGH SOUTHWEST CEMENT CO., 

Defendant. 

PAP AK, Magistrate Judge: 

No. 3:15-cv-01369-PK 

OPINION AND ORDER 

Plaintiff Ross Island Sand & Gravel Co. (Ross Island) manufactures and sells concrete. 

For forty years, Ross Island purchased cement, a key ingredient in concrete, from defendant 

Lehigh Southwest Cement Co. (Lehigh). 

In this action, Ross Island alleges that in fall 2014, Lehigh sold defective cement that 

caused Ross Island's concrete to fail at two construction sites. Ross Island claims that Lehigh is 

liable for damages caused by the allegedly defective cement. 

After the alleged failure of Lehigh's cement, Ross Island began purchasing all of its 

cement from a different cement supplier that charged higher prices than Lehigh. Ross Island now 

claims that Lehigh is obligated to pay Ross Island for the price difference, based on the paiiies' 

2012 "price protection agreement," in which Lehigh agreed to charge Ross Island discounted 

prices for cement used in three specific construction projects. I refer to these claims as cost-toPage 1 - OPINION AND ORDER 

Case 3:15-cv-01369-PK Document 89 Filed 10/27/16 Page 1 of 21
cover or price protection claims. Ross Island brings claims for breach of contract, breach of 

express warranty, breach of implied warranty, breach of the covenant of good faith and fair 

dealing, promissory estoppel, declaratory relief, and attorney's fees. 

Lehigh now moves for summary judgment on all of Ross Island's claims. Lehigh also 

moves to exclude opinion evidence from Ross Island's expert William Weyrauch; to strike the 

proposed testimony of certain Ross Island witnesses; and to amend its answer to include an 

affirmative defense. 

Ross Island moves for partial summary judgment on Lehigh's affirmative defense based 

on the pmiies' Janumy 2015 settlement agreement (the 2015 Settlement Agreement). 

For the reasons that follow, I grant Lehigh's motion for summmy judgment as to Ross 

Island's price protection claims, and deny the motion as to the defective cement claims. I deny 

Lehigh's motion to exclude Weyrauch's expe1i opinion, and its motion to strike proposed 

,testimony. I grant Lehigh's motion to amend its answer. I deny Ross Island's motion for pmiial 

summary judgment. 

I. LEHIGH IS ENTITLED TO SUMMARY JUDGMENT ON ROSS ISLAND'S COSTTO-COVER CLAIMS 

In its cost-to-cover claims, Ross Island seeks to recover the difference between Lehigh's 

proposed cement prices for 2015 and 2016 under the parties' 2012 price protection agreement 

(the Price Protection Agreement), and the higher prices Ross Island now pays for cement from its 

current supplier, Ash Grove Cement Co. I conclude that Ross Island has failed to overcome the 

Statute of Frauds' requirement ofa writing to show that the parties agreed to expand the 2012 

Price Protection Agreement beyond the three construction projects specified in the original 

agreement. 

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A. Background 

1. The 2012 Price Protection Agreement 

Before entering into the 2012 Price Protection Agreement at issue, the parties reached 

similar agreements in 2006 and in 2010. A1mstrong Deel. Exs. 36Under each agreement, Lehigh 

granted Ross Island discounted prices per ton of cement that Ross Island purchased for specified 

large constrnction projects. For example, in the paiiies' 2010 price protection agreement, Lehigh 

agreed to charge Ross Island $87 per ton of cement in 2011, discounted from Lehigh's base price 

of $94 per ton. Armstrong Deel. Ex. 37, ECF No. 73-36. The 2010 agreement listed the 

construction projects to which it applied, and included a discount schedule for subsequent years 

through 2014. Both the 2006 and the 2010 price protection agreements were oral agreements, 

which were documented at a later time. Armstrong Deel. Ex. 13, at 136-38. 1 

The parties orally agreed to the Price Protection Agreement at issue here on April 17, 

2012, when Bill Boughton, Lehigh's vice president of sales, met with Chuck Steinwandel, Ross 

Island's president and CEO, in a P01iland restaurant. The next day, Steinwandel handwrote the 

te1ms of the Price Protection Agreement on a spreadsheet that listed the three construction 

projects that would be eligible for the discounted cement prices, with estimates for the amount of 

cement required per year. The three construction projects were the Willamette River Transit 

Bridge, Portland Milwaukie Light Rail, and the Sellwood Bridge. 

Steinwandel's summary of the 2012 Price Protection Agreement stated: 

Presented and agreed between myself and Bill Boughton on the evening of April 

17, 2012. Regular pricing on cement for 2012, starting April 1, 2012, is 91.50 

1

Page numbers for deposition transcripts refer to the page numbers for the original 

transcript, not the page numbers for the exhibit that contains selected pages of the transcript. 

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Case 3:15-cv-01369-PK Document 89 Filed 10/27/16 Page 3 of 21
[per] ton. Standard pricing, 96.50 ton. [Ross Island] will pay down debt' by 

$300,000 by Dec. 31, 2012. [Initialed by Steinwandel and dated April 18, 2012] 

Armstrong Deel. Ex. 21. Steinwandel testified that his handwritten summaty is essentially a 

"complete recitation of the [Price Protection Agreement]." Armstrong Deel. Ex. 13, at 154. 

To receive price rebates under the 2012 Price Protection Agreement, Ross Island sent 

Lehigh monthly spreadsheets showing the amount of cement Ross Island had purchased from 

Lehigh during the previous month for the three specified construction projects. See Armstrong 

Deel. Ex. 11, at 148-49. Because of Ross Island's outstanding debts, Lehigh applied the rebate 

credits to Ross Island's old debt. Armstrong Deel. Ex. 2, at 114 (Boughton Depo.). 

The key issue for the cost-to-cover claims is whether Lehigh agreed to modify the 2012 

Price Protection Agreement to include construction projects that were not covered by the initial 

Agreement. Steinwandel testified that during the April 17, 2012 meeting, he asked Boughton to 

consider adding other construction projects to the Price Protection Agreement, and Boughton 

responded, "If you have other projects, come to me, and then we'll discuss whether I'm going to 

protect those projects." Armstrong Deel. Ex. 13, at 161. Steinwandel testified that he had "a 

general memory" of discussing with Boughton an expansion of the Price Protection Agreement 

to include other construction projects, but he had no "specific recall of a particular conversation 

on a particular date or time." Anderson Deel. Ex. 8, at 69, ECF No. 47. Steinwandel considered 

the inclusion of additional projects to be an expansion of the 2012 Price Protection Agreement. 

Armstrong Deel. Ex. 14, at 43. 

During 2013, Ross Island sent Lehigh monthly spreadsheets showing the amount of 

2 As of April 2013, Ross Island owed Lehigh about $1.7 million. Anderson Deel., Ex. 10, 

at 1. 

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cement purchased from Lehigh during the previous month for the three specified projects. 

Through 2013, Ross Island apparently limited its monthly spreadsheets to cement used in the 

three construction projects specified by the Agreement. 

Ross Island asserts that sometime in late 2013, Steinwandel and Boughton agreed to 

expand the Price Protection Agreement. PL Opp'n 8, ECF No. 71. Steinwandel testified that 

Lehigh, through Boughton, agreed to discount cement used in construction projects by four 

contractors: Skanska USA Building Inc., Perlo Construction, Cascade Bridge LLC, and Pacific 

Foundation. See Armstrong Deel. Ex. 14, at 40-41, ECF No. 73-13. But Ross Island has not 

presented any writing showing an agreement to modify the Price Protection Agreement. 

Boughton testified that he never agreed to expand the 2012 Price Protection Agreement beyond 

the original three projects. He testified that "the only thing that was protected, in my eyes and 

my understanding, were those three jobs." Anderson Deel. Ex. 5, at 122. 

In an attempt to show that the parties did agree to expand the Agreement, Ross Island 

cites the monthly spreadsheets it sent Lehigh to receive discounted cement prices. In early 2014, 

Ross Island changed the format of the monthly spreadsheets to show the tons of cement used by 

the four contractors, without showing on which construction projects the cement was used. A 

Ross Island employee, Ken Gambill, testified he decided to change the format of the 

spreadsheets, noting that by the end of2013, "We were running out of projects. We had done the 

first group [named in the initial agreement]." Anderson Deel. Ex. 6, at 261. Relying on the 

newly formatted spreadsheets, in 2014, Lehigh granted discounts to Ross Island for cement used 

by the four contractors, regardless of whether the cement was used on the three construction 

projects specified in the original Price Protection Agreement. 

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Lehigh now argues that its employees assumed that Ross Island would seek discounts 

only for the three original projects named in the 2012 Price Protection Agreement. Boughton 

testified that "everything that was submitted [by Ross Island as eligible for the discount], I would 

have assumed was appropriate and right for those three jobs. So, if ... a couple of jobs that got 

on that list that got by, it could have been overlooked by [a Lehigh employee]; unfortunate, but 

that could have been the case." Anderson Deel., Ex. 5, at 122. Referring to Ross Island's 2014 

spreadsheets, Boughton stated, "If they weren't related to those three jobs, they should not be 

requested for special pricing." Anderson Deel. Ex. 5, at 121. 

In May 2014, Lehigh employee Tony McCauley asked Ross Island employee Ken 

Gambill about the new format for the cement usage spreadsheets. Referring to the April 2014 

spreadsheet as an example, McCauley asked Gambill why Ross Island listed cement use by 

contractor rather than by project, as it had jn the 2013 spreadsheets. Although McCauley did not 

receive a complete answer from Gambill, he did not pursue the issue futiher. Armstrong Deel. 

Ex. 11, at 151, 152. 

After the concrete at a construction project failed, Ross Island stopped purchasing cement 

from Lehigh on November 21, 2014. Ross Island began purchasing cement from Ash Grove at 

higher prices than Lehigh's prices would have been under the Price Protection Agreement. 

In June 2015, Ross Island filed this action against Lehigh in Multnomah County Circuit 

Court. In July 2015, Lehigh removed the action to this cou1i. 

2. The Parties' 2015 Settlement Agreement 

In 2012 and 2013, Ross Island fell behind on its payments due to Lehigh. In April 2013, 

Ross Island agreed to repay Lehigh about $1. 7 million, in quarterly payments of $50,000 until 

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Case 3:15-cv-01369-PK Document 89 Filed 10/27/16 Page 6 of 21
fully paid. Anderson Deel., Ex. 10, at I. In July 2013, Ross Island again fell behind on its 

payments to Lehigh, accruing a new balance of about $731,000, in addition to the amount already 

owing. Ross Island agreed to make payments of $7,000 three times per month. 

In Janumy 2015, Lehigh filed a complaint in Multnomah County Circuit Court against 

Ross Island and other defendants, seeking amounts due under its agreements with Ross Island. 

About ten days later, Ross Island and Lehigh reached a settlement agreement (the 2015 

Settlement Agreement). Ross Island agreed that it owed Lehigh $1.3 million, including 

attorney's fees and costs up to January 22, 2015. Ross Island paid Lehigh $100,000 and agreed 

to pay Lehigh $750,000 by February 27, 2015, and the remainder due, about $450,000, by 

January 22, 2016. 

The 2015 Settlement Agreement included the following release: 

5. RELEASES 

Subject to the complete and timely performance of all obligations set f011h 

in this Agreement, the Parties, on behalf of themselves and their subsidiaries, 

parent companies, affiliates, owners, members, shareholders, agents, officers, 

attorneys, directors, employees, contractors, and representatives hereby release 

and discharge each other from all claims, counterclaims, cross-claims, causes of 

action, liens, damages, charges, penalties, and obligations whether known or 

unknown, or which the Pm1ies have ever had or now have, arising at any time up 

to the Effective Date of this Agreement (the "Released Claims"). Except as 

expressly set foi1h herein, the Pm1ies shall each pay their own attorney fees 

incurred in connection with the Litigation and this Agreement. 

El:plicitly excluded from the Released Claims are any and all: (I) claims 

arising from or in any way related to the enforcement of this Agreement; (ii) 

claims made by Ross Island against Lehigh arising out of the quality of the 

Product[3]; and (iii) claims that are not otherwise released in this Agreement. 

Notwithstanding anything to the contra1y herein, Lehigh's obligations, if any, 

under any wananty or wananty exclusion or limitation applicable to any of the 

Product shall remain unchanged. 

3

The word "Product" refers to Lehigh's cement. 

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Case 3:15-cv-01369-PK Document 89 Filed 10/27/16 Page 7 of 21
Anderson Deel., Ex. 10, at 5 (emphasis added). 

B. Legal Standards for Summary Judgment Motions 

The comt must grant summmy judgment when there are no genuine issues of material 

fact and the moving patty is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). If the 

moving party shows that there are no genuine issues of material fact, the nonmoving patty must 

go beyond the pleadings and designate facts showing an issue for trial. Celotex Corp. v. Catrett, 

477 U.S. 317, 322-23 (1986). A factual dispute is genuine "if the evidence is such that a 

reasonable jmy could return a verdict for the nonmoving pmty." Anderson v. Liberty Lobby, Inc., 

477 U.S. 242, 248 (1986). The substantive law governing a claim or defense determines which 

facts are material. See }vforeland v. Las Vegas lvfetro. Police Dep't, 159 F.3d 365, 369 (9th Cir. 

1998). In ruling on a motion for summaty judgment, the comt must draw all reasonable 

inferences in favor of the nonmoving pmty and may not make credibility detenninations or weigh 

evidence. See Anderson, 477 U.S. at 255. 

C. Ross Island's Claims Under the 2012 Price Protection Agreement 

1. Ross Island Has Not Shown That the Parties Agreed to Expand the 2012 

Price Protection Agreement 

A valid contract "requires a clear and unequivocal acceptance of a ce1tain and definite 

offer." Estey & Assocs., Inc. v. lvfcCul/och Corp., 663 F. Supp. 167, 173 (D. Or. 1986). A 

discussion will not create a contract "unless it is carried on to such an extent that the minds of the 

patties meet upon all the essential te1ms." Steel Prod. Co. of Oregon, Inc. v. Fi\1D Corp., 282 

Or. 513, 519, 579 P.2d 855, 858 (1978) (citations and quotation marks omitted). The pmty 

asse1ting the existence of an agreement bears the burden of proof. See J. L. Price Brokerage Co. 

v. Baker Groce1y Co., 94 Or. 538, 548, 186 P. 23, 25 (1919). 

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Here, Lehigh contends that Ross Island's cost-to-cover claims fail because the alleged 

expansion of the Price Protection Agreement is not documented by a writing. Under the Statute 

of Frauds, "a contract for the sale of goods for the price of $500 or more is not enforceable by 

way of action or defense unless there is some writing sufficient to indicate that a contract for sale 

has been made between the parties and signed by the party against whom enforcement is sought 

or by the authorized agent or broker of the party." Or. Rev. Stat.§ 72.2010(1). The Statute of 

Frauds' writing requirement also applies to alleged oral modifications of an agreement. Or. Rev. 

Stat.§ 72.2010(3) ("The requirements of ORS 72.2010, relating to the statute of frauds must be 

satisfied if the contract as modified is within its provisions."). The Unifo1m Commercial Code 

(UCC)'s official commentary on the UCC's equivalent to Or. Rev. Stat.§ 72.2010(3) is 

instructive here: 

The Statute of Frauds provisions of this Article are expressly applied to 

modifications by subsection (3). Under those provisions the "delivery and 

acceptance" test is limited to the goods which have been accepted, that is, to the 

past. "Modification" for the future cannot therefore be conjured up by oral 

testimony ifthe price involved is $500.00 or more since such modification must 

be shown at least by an authenticated memo. And since a memo is limited in its 

effect to the quantity of goods set foiih in it there is safeguard against oral 

evidence. 

Official Comment 3, UCC 2-209 (noting that subsection (3) is "intended to protect against false 

allegations of oral modifications"). 

Ross Island has not provided any writing showing that the parties agreed to modify the 

2012 Price Protection Agreement to include additional construction projects. Steinwandel 

testified that Boughton told him, in effect, "If you have other projects, come to me, and then 

we'll discuss whether I'm going to protect those projects." Armstrong Deel. Ex. 13, at 161. 

Steinwandel' s deposition testimony on this issue is at best vague and provisional, while 

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Boughton denies that Lehigh agreed to modify the Agreement to include additional construction 

projects. 

Ross Island argues that it has presented documents showing the pmiies agreed to modify 

the Price Protection Agreement to include additional projects. "If a writing is used to supply 

rather than to explain a term in another writing, then there must be additional evidence that the 

parties intended the two writings to be read together." }vfclnnis v. Lind, I 08 P .3d 578, 585, 198 

Or. App. 139, 149 (2005). Here, none of the evidence cited by Ross Island shows that the pmiies 

agreed to modify the Price Protection Agreement. 

As evidence of the alleged modification, Ross Island cites a July 2012 email it sent to 

Lehigh, attached to a spreadsheet report on cement usages, which states, "This rep01i will change 

as we add other work to the locations that are part of the agreement between Ross Island and 

Lehigh." Armstrong Deel. Ex. 46. The email acknowledges that additional work will occur on 

the three large construction projects subject to the Price Protection Agreement, but the email does 

not show that the parties agreed to include additional construction projects. 

Ross Island also cites the testimony of Tony McCauley, a Lehigh employee, that the Price 

Protection Agreement included locations where work had not yet begun. I note that McCauley 

had no role in negotiating the 2012 Price Protection Agreement. See Armstrong Deel. Ex. 14, at 

25 (Steinwandel testified that he negotiated "singly and solely" with Boughton). In any event, 

McCauley's statement is consistent with the terms of the 2012 Price Protection Agreement, 

which contemplated that the three large construction projects would be pouring concrete at 

multiple locations. 

In a fi.niher attempt to show a writing that documents the alleged expansion of the Price 

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Protection Agreement, Ross Island cites the monthly spreadsheets it sent to Lehigh during 2014, 

which sought price rebates for cement used on projects that were not included in the original 

Price Protection Agreement. Ross Island contends that Lehigh's willingness to allow credit for 

additional construction projects shows that the parties had a course of dealing that modified the 

original terms of the 2012 Price Protection Agreement. I disagree. The monthly spreadsheets 

refer only to past usage, so they are limited in effect "to the quantity of goods set forth" in them. 

In other words, the monthly spreadsheets, which covered cement used during the prior month, 

cannot show an agreement to continue granting discounts for other projects in the foture. 

Lehigh's willingness, mistaken or not, to grant discounts based on Ross Island's 2014 

spreadsheets does not show an intent to extend the discounts to foture purchases of cement. 

Ross Island also argues that the 2012 Price Protection Agreement was a requirements 

contract, and that the Statute of Frauds does not require that requirements contracts include a 

written provision on the quantity of goods to be sold. Instead, a requirements contract may 

satisfy the Statute of Frauds if the pmiies agree that the quantity of goods sold will be the amount 

required by the buyer. See Or. Rev. Stat.§ 72.3060(1). 

Here, while I agree with Ross Island that the 2012 Price Protection Agreement is a 

requirement contract, I conclude that it is a requirements contract only as to the three projects 

named in the Agreement. The estimated cement usage figures included in the Price Protection 

Agreement are based on the three specified construction projects. To add multiple unknown 

construction projects as eligible for discounts would be a material modification of the Agreement 

that must be evidenced by a writing to be enforceable. See In re Empire Pac. Indus., Inc., 71 

B.R. 500, 504 n.3 (Bankr. D. Or.1987) ("The addition of a quantity te1m other than that 

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previously agreed to would materially alter the terms of the contract."). 

Ross Island also relies on the UCC merchant rule, which provides: 

Between merchants, if within a reasonable time a writing in confinnation of the 

contract and sufficient against the sender is received and the party receiving it has 

reason to know its contents, it satisfies the requirements of subsection (1) of this 

section against such party unless written notice of objection to its contents is 

given with 10 days after it is received. 

Or. Rev. Stat.§ 72.2010(2). I agree with Lehigh that the merchant rule does not aid Ross Island 

here, because, as noted, the spreadsheets submitted by Ross Island in 2014 do not show an 

agreement to expand the Price Protection Agreement to include additional projects. Lehigh's 

apparently cavalier attitude in allowing price rebates beyond the three construction projects, 

without more, does not show an intent to expand the Price Protection Agreement. 

In an attempt to avoid the requirements of the Statute of Frauds, Ross Island argues that 

Lehigh is liable under a promissory estoppel theory. "In Oregon promiss01y estoppel is not a 

cause of action in itself, but is a subset of and a the01y of recove1y in breach of contract actions." 

Kraft v. Arden, No. 07-487-PK, 2008 WL 4866182, at *10 (D. Or. Nov. 7, 2008) (citations and 

quotation marks omitted). "Under promissory estoppel, the party seeking enforcement of a 

promise must demonstrate: '1) a promise, 2) which the promisor, as a reasonable person, could 

foresee would induce conduct of the kind which occuned, 3) actual reliance on the promise, 4) 

resulting in a substantial change in position.' A party may seek relief under promissory estoppel 

when no valid contract exists. Thus, promissory estoppel can defeat the Statute of Frauds." Id. 

(citations omitted). 

Here, Ross Island alleges that it relied on Boughton's alleged statement to Steinwandel 

that he would consider future requests to expand the discount agreement to other projects. 

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Steinwandel could not recall specifically when Boughton orally agreed to expand the Price 

Protection Agreement. Boughton' s alleged statements are no more than an illusory promise, 

which cannot justify Ross Island's alleged reliance. See Kraft, at *36. 

Nor has Ross Island shown evidence of detrimental reliance. Ross Island has not 

presented documents suppo1iing its assertions that it submitted lower bids to contractors based on 

Lehigh's discounted price for cement. 

Ross Island argues that the court should strike evidence submitted by Lehigh in suppo1i of 

its Statute of Frauds affirmative defense because Lehigh's Rule 30(b)(6) witness, Boughton, did 

not mention the deposition testimony of Steinwandel as evidence supp01iing the defense. I see 

no prejudice to Ross Island when its CEO's deposition testimony is used as evidence against it. 

As an additional affirmative defense, Lehigh contends that Ross Island failed to mitigate 

damages. Lehigh notes that when Ross Island stopped purchasing cement that Lehigh 

manufactured in Redding, California, Ross Island did not seek to substitute cement that Lehigh 

manufactured in British Columbia, which Ross Island considered high quality and used for many 

years until 20 I 0. Instead, Ross Island chose to pay a higher price for cement from Ash Grove. 

Because I conclude that Lehigh is entitled to summary judgment on the cost-to-cover claims, I 

need not address this defense. 

2. The 2015 Settlement Agreement Bars Ross Island's Price Claims 

Alternatively, Lehigh contends that it is entitled to summmy judgment on Ross Island's 

price protection claims because of the 2015 Settlement Agreement, which releases all claims 

except, as relevant here, "claims made by Ross Island against Lehigh arising out of the quality of 

the Product [i.e., cement]." Lehigh argues that Ross Island's price protection claims are based on 

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the quantity of Lehigh's cement, not its quality. 

Because I conclude that the Statute of Frauds bars the price protection claims, I need not 

address the effect of the 2015 Settlement Agreement. 

II. DISPUTED ISSUES OF MATERIAL FACT PRECLUDE SUMMARY JUDGMENT 

ON ROSS ISLAND'S DEFECTIVE CEMENT CLAIMS 

The cement sold by Lehigh to Ross Island is referred to as Cl50-12, Type I/II under 

standards set by the American Society for Testing and Materials (ASTM). Anderson Deel., Ex. 

1, at 11, ECF No. 47. For about 30 years, Lehigh sold Ross Island Type I/II cement that was 

manufactured in Vancouver, British Columbia, which the pmiies refer to as Delta cement.4 

Armstrong Deel. Ex. 13, at 105 (Steinwandel Depo.). 

Starting in about 2008, Lehigh asked Ross Island to switch from the Delta cement to 

cement Lehigh manufactured at a plant in Redding, California. Steinwandel testified that he 

initially refused to switch to Redding cement because Delta cement had performed so reliably for 

many years. After Ross Island and Lehigh separately compared Redding cement to Delta cement. 

Steinwandel decided that Redding cement would be satisfacto1y. Anderson Deel. Ex. 6, at 108 

(Ken Gamill Depo). By July 2010, Ross Island switched to Redding cement and stopped using 

Delta cement. Aimstrong Deel. Ex. 19. 

Wayne Flues, Ross Island's quality control manager, testified that from 2010 until fall 

2014, Ross Island had no problems with the Redding cement. Flues stated that "we trusted [the 

Redding cement] and used it exclusively for the Tilikum Bridge project ... because of our trust 

in that cement, and in our ability to produce strengths that we needed, like we needed to happen." 

4 Former Ross Island president and CEO Chuck Steinwandel refened to Delta cement as 

"Tilbury cement." Aimstrong Deel. Ex. 13, at 76-77 (Steinwandel Depo.). 

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Armstrong Deel. Ex. 4, at 122. 

A. Concrete Failures at Two Projects 

Ross Island alleges that Lehigh's cement caused its concrete to fail at two construction 

projects. 5 The first concrete failure occurred on October 11, 2014, at the I-5 Corporate Park . 

project in Wilsonville, Oregon. The concrete was used for a "tilt wall panel," placed on October 

11, 2014. Anderson Deel., Ex. 1at47. Tilt wall panels are poured onto a casting slab and then 

tilted into place. The project owner rejected the panels because of surface imperfections when 

the panels were lifted into place. Perlo Construction, the contractor, removed and replaced the 

panels. 

The second concrete problem was at a foundation poured at the Athey Creek project in 

West Linn, Oregon. On November 20, 2014, Ross Island concrete was poured for a basement 

floor slab. Ross Island alleges that Lehigh cement caused the concrete slab to set too slowly. 

Before the slab could set, it rained, ruining the slab's surface and requiring removal and a new 

pour. 

Ross Island's expe1i, William Weyrauch, used the process of elimination to conclude that 

Lehigh's cement had the problems with Ross Island's concrete at the I-5 and Athey Creek 

projects. Weyrauch reasoned that he could eliminate all other possible extemal and internal 

reasons for the concrete problems, other than the cement. Although Weyrauch acknowledged 

that Lehigh's regular test records indicated that Lehigh's cement met the standards for Type I/II 

5 In its Second An1ended Complaint, Ross Island alleged that Lehigh's cement caused two 

other concrete failures, at the Burnside Bridgehead Project and the Sumise Corridor Project. 2d 

Amd. Comp!. ~~ 33-38, ECF No. 22. In the Third Amended Complaint, which is now the 

operative complaint, Ross Island has dropped its allegations about these two projects. 

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cement, Weyrauch concluded compliance with the basic standards was not sufficient to show that 

the Lehigh cement had perfonned adequatdy. 

I conclude that disputed issues of material fact exist whether Lehigh provided defective 

cement. At the Athey Creek project, Wayne Flues, Ross Island's quality control manager, 

observed that concrete containing Lehigh cement did not set properly, but concrete using the 

same mix, except with Ash Grove cement, did set properly. Flues testified that he was surprised 

by this result because "[i]f anything, it's the coldest part of the slab. It should be the part that's 

not. It shouldn't be setting up, because it doesn't have the protection and the heat of the rest of 

that slab. This should be the least set-up part of the whole thing." Annstrong Deel. Ex. 5, at 

143.6 

Lehigh argues that Ross Island's breach of wananty claims are baned by the wmTanty 

disclaimer included on Lehigh's invoices. The disclaimer provides that the cement "shall 

conform to the present standard specifications (for the respective types) of the American Society 

for Testing and Materials, and no other wananty, representation or condition of any kind, express 

or implied (including no wananty of merchantability or of fitness for a particular purpose) shall 

apply thereto." Anderson Deel. Ex. 5, at 24. Under the UCC, a contract for the sale of goods 

includes an implied wananty that the goods shall be merchantable "if the seller is a merchant 

with respect to goods of that kind." Or. Rev. Stat. § 72.3140. "The purpose of such a wananty is 

to protect the buyer of goods from bearing the burden of loss when the goods, although not 

violating an express wmTanty, do not meet the buyer's particular purpose." Controltek, Inc. v. 

6

Lehigh moves to strike this and other po1iions ofFlues's deposition testimony. I will 

discuss Lehigh's motion to strike below. 

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Kwikee Enterprises, Inc., 284 Or. 123, 128, 585 P.2d 670, 673 (1978). I conclude that there are 

disputed issues of material fact on whether there was at least an implied warranty of fitness for 

purpose that goes beyond simply meeting the standards for Type VII cement. 

III. Lehigh's Motion to Exclude Expert Opinion Evidence 

Lehigh moves to exclude the expe1i opinion evidence of Ross Island's expe1i William 

Weyrauch. I deny the motion. 

A. Legal Standards for Evaluating Expert Testimony 

Federal Rule of Evidence 702 provides: 

A witness who is qualified as an expert by knowledge, skill, experience, training, 

or education may testify in the foim of an opinion or otherwise if: 

(a) the expert's scientific, technical, or other specialized knowledge 

will help the trier of fact to understand the evidence or to determine 

a fact in issue; 

(b) the testimony is based on sufficient facts or data; 

( c) the testimony is the product of reliable principles and methods; and 

( d) the expe1i has reliably applied the principles and methods to the 

facts of the case. 

Expe1i opinion is admissible if the expert is qualified and the expe1i' s testimony is 

reliable and relevant. See Daubert v. lvlerrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 589 

(1993). The district court acts as a '"gatekeeper,' excluding 'junk science' that does not meet the 

standards ofreliability required under Rule 702." Domingo ex rel. Domingo v. T.K, 289 F.3d 

600, 605 (9th Cir. 2002). The inquhy into reliability is flexible and depends on the facts of the 

pmiicular case. See Estate of Barabin v. AstenJohnson, Inc., 740 F.3d 457, 463 (9th Cir. 2014) 

(en bane). 

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Admissibility of expert testimony is a matter for preliminaiy determination by the court 

under Federal Rule of Evidence 104(a), and the pmiy offering the evidence must prove 

admissibility by a preponderance of the evidence. See Daubert, 509 U.S. at 592-93. The 

admissibility of expeii testimony is "'a subject peculiarly within the sound discretion of the trial 

judge, who alone must decide the qualifications of the expert on a given subject and the extent to 

which his opinions may be required."' United States v. Chang, 207 F.3d 1169, 1172 (9th Cir. 

Cal. 2000) (quoting Fineberg v. United States, 393 F.2d 417, 421 (9th Cir. 1968)). 

The trialjudge may consider a number of factors to detennine the reliability of an 

expert's testimony, including: "1) whether a theory or technique can be tested; 2) whether it has 

been subjected to peer review and publication; 3) the known or potential error rate of the theory 

or technique; and 4) whether the theory or technique enjoys general acceptance within the 

relevant scientific community." United States v. Hankey, 203 F.3d 1160, 1167 (9th Cir. 2000). 

B. Wcyrauch's Background and Expert Opinion 

Weyrauch is a geotechnical and materials engineer who has more than 3 8 years of 

experience with concrete and other constrnction materials. Weyrauch has been a member, and a 

past president, of the American Concrete Institute since 1980. He is a member of technical 

committees at the Oregon Concrete and Aggregate Producers Association that oversees Oregon 

Depmiment of Transportation (ODOT) certification programs for "testing fresh concrete, 

preparing samples and developing and adjusting concrete mix designs on ODOT projects." Pl. 

Opp'n 3, ECF No. 67. 

Weyrauch's report concludes that the concrete failures at the Athey Creek and I-5 projects 

were caused by "excessively slow set times." Id. Weyrauch states that four factors could have 

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caused the slow set times: "improper concrete mix, weather conditions, admixtures, and 

cement." Id He stated that he could eliminate concrete mix, weather, and admixtures as 

potential causes of the slow set times. Although Weyrauch could not test the Lehigh cement that 

was actually used by Ross Island at the two sites, he concluded that based on the process of 

elimination, Lehigh's cement caused the concrete failures. 

C. Discussion 

Lehigh contends that Weyrauch's expert opinion should be excluded because he did not 

examine each potential cause of the concrete failures. Lehigh also argues that Weyra{1ch's 

testimony should be excluded because "he provides an insufficient explanation for why he did 

not bother to examine the ve1y substance at issue in this case: data pertaining to the cement at 

issue." Def. Reply 4, ECF No. 80. 

Ross Island contends that Weyrauch's process of elimination method is recognized as a 

proper basis for expert opinion. See Clausen v. }vf!VNew Carissa, 339 F.3d 1049, 1061 (9th Cir. 

2003). Ross Island argues that Weyrauch's extensive experience qualifies him to testify as an 

expert. 

Lehigh's objections go to the weight, not the admissibility, ofWeyrauch's expert 

opinions. Lehigh may, for example, cross-examine Weyrauch on his failure to test the cement at 

issue. I conclude that Weyrauch's expert opinion testimony as to the I-5 and Athey Creek 

concrete failures is admissible. 

Lehigh also argues that Weyrauch' s testimony as to other projects where concrete 

allegedly failed may should not be admitted. Weyrauch states that he did not evaluate the other 

alleged concrete failures in depth. I reserve ruling on this issue. 

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IV. Lehigh's J\ilotion to Strike Evidence 

Lehigh moves to strike portions of the testimony ofRoss Island witnesses Wayne Flues, 

Ken Gambill, and Morgan Johnson, although Lehigh's briefing focuses solely on the testimony 

of Flues, Ross Island's quality control manager. Lehigh contends that Flues is offering expert 

testimony, violating Federal Rule of Evidence 701(c)'s prohibition against a lay witness 

testifying to an opinion that is based on "scientific, technical, or other specialized knowledge 

within the scope of Rule 702." Fed. R. Evid. 70l(c). Lay witnesses' opinions must be 

"'predicated upon concrete facts within their own observation and recollection~that is facts 

perceived from their own senses, as distinguished from their opinions or conclusions drawn from 

such facts."' United States v. Durham, 464 F.3d 976, 982 (9th Cir. 2006) (quoting United States 

v. Skeet, 665 F.2d 983, 985 (9th Cir. 1982) (further citation and quotation marks omitted)). 

I deny Lehigh's motion to strike. Flues's testimony is generally based on his own 

observations of the performance of Ross Island concrete at construction sites, and on his personal 

knowledge of concrete. See, e.g. Hammann v. 800 Ideas Inc., No. 2:08-cv-0886-LDG-GWF, 

2014 WL 1089664, at *2 (D. Nev. Mar. 18, 2014) ("the law does not prohibit lay witnesses from 

testifying based on particularized knowledge gained from their own experience"). Lehigh's 

objections based on hearsay or other grounds may be addressed at trial. 

V. Lehigh's Motion to Amend Answer 

Lehigh moves to amend its answer to include an affirmative defense based on Ross 

Island's apparent promise in the 2012 Price Protection Agreement to pay down $300,000 of Ross 

Island's outstanding debt to Lehigh. Ross Island apparently never fulfilled that promise. 

Although Lehigh could have raised this affirmative defense sooner, the proposed 

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amendment should not prejudice Ross Island. I grant Lehigh's motion to amend the answer, 

although in light of my rulings on Ross Island's cost-to-cover claims, the amendment may be 

moot. 

VI. Ross Island's Motion for Partial Summary Judgment 

Ross Island moves for partial summary judgment on Lehigh's atfamative defense based 

on the 2015 Settlement Agreement, which released all claims other than claims based on the 

quality of Lehigh's cement. 

I deny Ross Island's motion for pa1iial summary judgment. The atfomative defense may 

apply to Ross Island's claims related to the Price Protection Agreement. I also conclude that it 

would be premature to address entitlement to attorney's fees under the 2015 Settlement 

Agreement. 

CONCLUSION 

Lehigh's Motion for Summary Judgment, ECF No. 46, is GRANTED as to Ross Island's 

Price Protection Claims, and otherwise DENIED. Lehigh's Motion for Extension of Time to 

Amend Pleadings, ECF No. 60, is GRANTED. Ross Island's Motion for Partial Summary 

Judgment, ECF No. 50, is DENIED. Lehigh's Motion to Exclude Expert Opinion Evidence from 

William Weyrauch, ECF No. 48, and Motion to Strike Evidence Offered by Ross Island, ECF 

No. 78, are DENIED. 

Dated this ,'-t)i \1ay j Or~ber,20~~ . 

·. //d IU ('\- Cj\ c-/2 

Hono;able Paul Papak 

United States Magistrate Judge 

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