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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Greyhound Lines Incorporated,

Plaintiff, 

v. 

Viad Corporation, 

Defendant. 

No. CV-15-01820-PHX-DGC

ORDER 

 Plaintiff Greyhound Lines, Inc. filed a complaint against Defendant Viad Corp. 

Doc. 1. Greyhound seeks damages and declaratory relief for Viad’s alleged failure to 

satisfy its statutory and contractual obligations to indemnify Greyhound for costs 

associated with environmental damages on certain specific properties, as well as for 

nuisance. Id., ¶ 25; Doc. 30. Viad responded to Greyhound’s complaint and asserted its 

own counterclaims, seeking declaratory and monetary relief for an alleged breach of 

contract, as well as indemnification for environmental costs paid by Viad. Doc. 15, 

¶¶ 30-53. Viad subsequently amended its counterclaims to include allegations of fraud 

and negligent misrepresentation. Doc. 31, ¶¶ 49-68. 

 Greyhound and Viad have filed cross-motions for partial summary judgment. The 

motions are fully briefed, and the Court heard oral argument on November 10, 2016. For 

the reasons set forth below, the Court will grant Greyhound’s motion for summary 

judgment as to the fraud and misrepresentation claims, and deny Greyhound’s and Viad’s 

motions for summary judgment on the contract claims. 

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I. Background. 

 Between 1986 and 1999, Greyhound and Viad entered into four contracts 

(collectively, “Agreements”), which are at the center of this litigation. First, on 

December 22, 1986, the parties entered into an Acquisition Agreement that provided for 

the sale of certain of Viad’s assets – including real properties – to Greyhound. Doc. 66-

10. As part of the Acquisition Agreement, Viad indemnified Greyhound for costs related 

to general liabilities and obligations. Id. at 50-51. Several amendments were made to the 

Acquisition Agreement, but only the Third Amendment, dated March 18, 1997, is 

relevant here. Article III of the Third Amendment laid out several detailed changes 

concerning Viad’s liability to Greyhound for environmental matters. Doc. 66-11 at 7. 

Specifically, the Third Amendment created a particular scheme for remediation of 

contamination caused by underground storage tank (“UST”) leaks at the various 

properties. Id. at 8. 

 On August 23, 1991, the parties entered into a Claims Treatment Agreement. 

Doc. 66-12. Section 14(a) addressed environmental indemnification between the parties, 

clarifying their respective responsibilities under the amended Acquisition Agreement and 

limiting Viad’s liability for remediation to contamination identified prior to March 1, 

1992. Id. at 11. Finally, in 1999, the parties entered into a Settlement Agreement which 

further clarified the responsibilities of the parties under the amended Acquisition 

Agreement and Claims Treatment Agreement by amending them to include newly 

defined terms. Doc. 66-13 at 3. The Court will discuss the provisions of the Agreements 

in more detail below. 

 There are numerous factual disputes concerning the parties’ performance under the 

Agreements, but it is undisputed that Greyhound has submitted reimbursement requests 

to Viad over the years and some have been paid. Viad has made no payment since 2009. 

Doc. 73 at 51; Doc. 90 at 51. Viad’s Director of Environment and Energy from 1987 to 

2001, Ken Ries, was responsible for coordinating and overseeing remediation efforts for 

Viad in connection with the properties covered by the Agreements. Doc. 66, ¶ 37; Doc. 

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89, ¶ 37. Since 2001, Ries has continued to work for Viad as an independent consultant 

in the same capacity. Id. 

 On September 11, 2015, Greyhound brought a claim against Viad seeking 

declaratory and monetary relief for breach of contract and private nuisance. Doc. 1. 

Additionally, Greyhound seeks cost recovery under the Comprehensive Environmental 

Response, Compensation, and Liability Act of 1980 (“CERCLA”). Doc. 30. According 

to the complaint, Viad has “failed to meet its obligations under both its statutory 

obligations and the [Agreements] to pay for the environmental costs incurred by” 

Greyhound. Id., ¶ 25. Viad’s counterclaim alleges breach of contract and also seeks 

declaratory and injunctive relief. Doc. 31. According to Viad, Greyhound “has 

improperly sought and obtained payment from Viad for costs associated with 

Environmental Obligations of which Viad was not notified before March 1, 1992[.]” Id., 

¶ 22. 

 The claims relate to six properties, located in Portland, Seattle, Memphis, Miami, 

Jacksonville, and Oakland. Doc. 64 at 6; Doc. 72 at 1. Greyhound sold the Seattle and 

Miami properties to third parties in 2008 and 2013, respectively. Doc. 73, ¶¶ 27, 36; 

Doc. 90, ¶¶ 27, 36. Greyhound seeks reimbursement from Viad for costs incurred in the 

sale of these properties relating to environmental conditions thereon. 

II. Legal Standard. 

 A party seeking summary judgment “bears the initial responsibility of informing 

the district court of the basis for its motion, and identifying those portions of [the record] 

which it believes demonstrate the absence of a genuine issue of material fact.” Celotex 

Corp. v. Catrett, 477 U.S. 317, 323 (1986). Summary judgment is appropriate if the 

evidence, viewed in the light most favorable to the nonmoving party, shows “that there is 

no genuine dispute as to any material fact and the movant is entitled to judgment as a 

matter of law.” Fed. R. Civ. P. 56(a). Summary judgment is also appropriate against a 

party who “fails to make a showing sufficient to establish the existence of an element 

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

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trial.” Celotex, 477 U.S. at 322. Only disputes over facts that might affect the outcome 

of the suit will preclude the entry of summary judgment, and the disputed evidence must 

be “such that a reasonable jury could return a verdict for the nonmoving party.” 

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). 

 The parties’ arguments focus on Arizona law, and no choice-of-law issues have 

been raised. The Court therefore will look to Arizona law for the relevant statutes of 

limitations, principles of contract interpretation, accord and satisfaction, and the 

economic loss doctrine. 

III. Greyhound’s Motion for Summary Judgment. 

 A. Statute of Limitations. 

 Greyhound argues that Viad’s counterclaims are time-barred. The Court finds that 

disputed facts prevent summary judgment on this issue. 

 1. Arizona Law.

 Arizona law applies the discovery rule to cases under both contract and tort law. 

Gust, Rosenfeld & Henderson v. Prudential Ins. Co. of Am., 898 P.2d 964, 967-68 (Ariz. 

1995). “Under the discovery rule, a plaintiff’s cause of action does not accrue until the 

plaintiff knows or, in the exercise of reasonable diligence, should know the facts 

underlying the cause.” Id. at 966. The discovery rule is motivated by the equitable 

concern that “it is unjust to deprive a plaintiff of a cause of action before the plaintiff has 

a reasonable basis for believing that a claim exists.” Id. at 967. Courts have recognized 

that statutes of limitations are intended to protect defendants from stale claims where 

plaintiffs have slept on their rights, but “[a] blamelessly uninformed plaintiff cannot be 

said to have slept on his rights.” Walk v. Ring, 44 P.3d 990, 995-96 (Ariz. 2002).

 The key “inquiry in applying the discovery rule is whether the plaintiff’s injury or 

the conduct causing the injury is difficult for plaintiff to detect.” Gust, 898 P.2d at 968. 

Importantly, the discovery rule “does not permit a party to hide behind its ignorance 

when reasonable investigation would have alerted it to the claim.” ELM Ret. Ctr., LP v. 

Callaway, 246 P.3d 938, 941 (Ariz. Ct. App. 2010). In a breach of contract case, this 

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means that a party must still “exercise[] reasonable diligence in monitoring the 

performance of another under the contract.” Gust, 898 P.2d at 969. Where the “wrong 

constituting the cause of action is concealed, limitation will not begin to run until such 

concealment is discovered, or reasonably should have been discovered.” Walk, 44 P.3d 

at 995 (citing Acton v. Morrison, 155 P.2d 782, 784 (Ariz. 1945)). Accordingly, “the 

core question is whether a reasonable person would have been on notice to investigate.” 

Id. at 996. “[S]ummary judgment is warranted only if the failure to go forward and 

investigate is not reasonably justified.” Id. 

 The Arizona Supreme Court has made clear that “[w]hen discovery occurs and a 

cause of action accrues are usually and necessarily questions of fact for the jury.” Doe v. 

Roe, 955 P.2d 951, 961 (Ariz. 1998); Walk, 44 P.3d at 996. “The jury must determine at 

what point Plaintiff’s knowledge, understanding, and acceptance in the aggregate 

provided sufficient facts to constitute a cause of action.” Doe, 955 P.2d at 962. “A 

plaintiff need not know all the facts underlying a cause of action to trigger accrual. But 

the plaintiff must at least possess a minimum requisite of knowledge sufficient to identify 

that a wrong occurred and caused injury.” Id. at 961 (emphasis in original; internal 

citation omitted). 

 Additionally, Arizona law permits the tolling of the statute of limitations “when a 

party wrongfully conceals facts giving rise to the cause of action so as to prevent a 

potential plaintiff from reasonably discovering the claim’s existence during the limitation 

period.” Walk, 44 P.3d at 999 (emphasis in original). “In general, to toll the statute of 

limitations the fraud must prevent inquiry, elude investigation or mislead the party who 

claims the cause of action. The concealment must come after the injury, and there must 

be some affirmative act of the defendant calculated to obscure the existence of a cause of 

action.” Anson v. Am. Motors Corp., 747 P.2d 581, 588 (Ariz. Ct. App. 1987) (internal 

quotation marks and citations omitted); Cooney v. Phoenix Newspapers, Inc., 770 P.2d 

1185, 1187 (Ariz. Ct. App. 1989); Tovrea Land & Cattle Co. v. Linsenmeyer, 412 P.2d 

47, 63 (Ariz. 1966) (“Mere silence by the person allegedly committing the fraud will not 

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avoid the running of the statute. There must be positive acts of concealment done to 

prevent detection. There must be some trick or contrivance intended to exclude suspicion 

and prevent inquiry.”). 

 “The defense of statute of limitations is never favored by the courts, and if there is 

doubt as to which of two limitations periods should apply, courts generally apply the 

longer.” Gust, 898 P.2d at 968. Because the statute of limitations is an affirmative 

defense, the burden of proof lies with the defendant. Estate of Page v. Litzenburg, 865 

P.2d 128, 135 (Ariz. Ct. App. 1993). The burden of proving the statute was tolled, 

however, rests with the claimant. Engle Bros. v. Superior Court In & For Pima Cty., 533 

P.2d 714, 716 (Ariz. Ct. App. 1975). Similarly, “[t]he burden of establishing that the 

discovery rule applies to delay the statute of limitations rest[s] on plaintiff.” Logerquist 

v. Danforth, 932 P.2d 281, 284 (Ariz. Ct. App. 1996). 

 2. Viad’s Claims. 

 Greyhound argues that Viad’s breach of contract claims are subject to a six-year 

statute of limitations under A.R.S. § 12-548, and that Viad’s claims for fraud and 

negligent misrepresentation are subject to at least a three-year statute of limitations under 

A.R.S. §§ 12-542.1

 Doc. 64 at 14-15. Viad does not dispute these limitation periods, but 

argues that it did not learn the facts underlying its claims until after Greyhound filed this 

lawsuit. Doc. 78 at 14. Viad also contends that Greyhound intentionally concealed 

information that would have put Viad on notice that it was being wrongfully billed for 

remediation for which it was not contractually liable. Id. at 11-14. Because Viad seeks 

to recover for alleged overpayments it made to Greyhound, and Viad last made a 

payment to Greyhound on March 25, 2009, the only issues are when the respective 

limitations periods commenced, and whether the periods were subject to tolling. As 

discussed above, Viad has the burden of proof on both of these issues.2

 

1

 Greyhound contends that the fraud and negligent misrepresentation claims may also be subject to a two-year statute of limitations under A.R.S. § 12-543. The Court 

need not decide which statute of limitations applies at this time. 

2

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 The Court concludes that a genuine factual dispute precludes summary judgment. 

Greyhound contends that Viad had an in-house expert, Ken Ries, monitoring 

environmental work at the properties, reviewing invoices sent by Greyhound, reviewing 

explanatory information provided by Greyhound, and tracking the work and payments for 

each site on his own internal spreadsheets. Greyhound alleges that Ries had access to all 

of the information he requested, that he visited Greyhound and the properties in question, 

and that he spoke directly with consultants performing the work. Greyhound notes that 

Ries had been responsible for these sites for more than 30 years, and thus was intimately 

familiar with their contamination and the required remediation. As a result, Greyhound 

asserts, Viad knew or should have known precisely what work was being done at the 

properties and the scope of work covered by Greyhound’s bills to Viad – the very facts 

on which Viad now bases its breach of contract and tort claims. 

 Viad paints a different picture. It asserts that Greyhound knew it was investigating 

and remediating contamination for which Viad was not responsible under the 

Agreements, and yet billed Viad for that work on a regular basis. Viad asserts that 

Greyhound never informed Ries of this fact, and withheld key information that would 

have revealed that improper payments were being sought. Viad contends that Ries relied 

not only on the incomplete information provided by Greyhound, but also that Greyhound 

undertook an obligation in the Agreements to bill only for work for which Viad was 

responsible. Viad provides specific examples of contamination for which Greyhound 

allegedly was solely responsible at each of the sites, and yet which was included in the 

work for which Viad was billed. Additionally, Viad contends that Greyhound actively 

concealed information regarding new sources of contamination at the relevant properties 

and failed to provide information that Ries requested when reviewing reimbursement 

requests. Doc. 78 at 14-15; Doc. 89, ¶¶ 130-133. 

 This sharp factual disagreement precludes summary judgment. As Arizona courts 

 filed its counterclaims in this action. Doc. 78 at 10 n.1. This is still more than six years after the last payment received by Greyhound. 

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have noted, application of the discovery rule and related tolling doctrines often present 

factual issues that must be resolved at trial. Doe, 955 P.2d at 961; Walk, 44 P.3d at 996. 

This is such a case.3

 B. Collateral Estoppel. 

“Under collateral estoppel, once an issue is actually and necessarily determined by 

a court of competent jurisdiction, that determination is conclusive in subsequent suits 

based on a different cause of action involving a party to the prior litigation.” Montana v. 

United States, 440 U.S. 147, 153 (1979). “To foreclose relitigation of an issue under 

collateral estoppel: (1) the issue at stake must be identical to the one alleged in the prior 

litigation; (2) the issue must have been actually litigated in the prior litigation; and (3) the 

determination of the issue in the prior litigation must have been a critical and necessary 

part of the judgment in the earlier action.” Clark v. Bear Stearns & Co., Inc., 966 F.2d 

1318, 1320 (9th Cir. 1992). When analyzing a party’s attempt to assert collateral 

estoppel, “[t]he party asserting preclusion bears the burden of showing with clarity and 

certainty what was determined by the prior judgment.” Id. at 1321. “Since the doctrine 

of collateral estoppel applies only to matters actually litigated, it is imperative that the 

party claiming estoppel adequately show the controlling facts of the prior litigation.” 

United States v. Lasky, 600 F.2d 765, 769 (9th Cir. 1979).4

 

3

 Viad claims that it satisfied the requirement of due diligence by requiring Greyhound “to confirm that the work for which it billed was properly allocated to Viad under the parties’ agreement.” Doc. 78 at 16. Viad cites Gust for the assertion that “[a] 

party is not required to obtain more than a solemn promise to perform to satisfy the diligence requirement.” Id. at 16-17. The Court does not agree. Gust held that the 

protection of the discovery rule is not lost because a plaintiff failed to require in a contract that that the opposing party advise it of specific adverse events, but it did not hold that such a contract provision will satisfy the requirement of due diligence in all cases. 898 P.2d at 969. This is part of the factual issue to be addressed in this case. The 

parties’ contractual agreements will be relevant to whether Viad acted reasonably, but the Court cannot accept the suggestion that the contracts alone prove due diligence. The jury in Gust found that the plaintiff engaged in reasonably diligent monitoring. Id. The same 

inquiry will be required in this case. 

4

 The parties do not address in their briefs whether federal or Arizona state law 

governs the collateral estoppel issue raised by Greyhound, but rather assume federal law applies. Precedent from the Supreme Court and Ninth Circuit indicate that Arizona law 

may in fact be the relevant governing law. See Semtek Int’l Inc. v. Lockheed Martin 

Corp., 531 U.S. 497 (2001); Taco Bell Corp. v. TBWA Chiat/Day Inc., 552 F.3d 1137, 

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Greyhound argues that: 

Viad is precluded from arguing (i) that it did not have notice of the 

Environmental Obligations if the evidence shows that Viad was informed 

(either by [Greyhound], a regulator, or by the fact that Viad itself was 

performing the work) of subsurface contamination prior to March 1, 1992; 

and (ii) that releases to the subsurface, regardless of whether a specific tank 

or constituent can be identified, are Environmental Obligations for which it 

owes indemnification. 

Doc. 64 at 14. According to Greyhound, these issues are identical to issues decided in a 

2002 case between Greyhound and Viad before the United States District Court for the 

Southern District of California (“San Diego case”). Id. Viad argues that the issues in the 

San Diego case are irrelevant to its claims here. Doc. 78 at 8. The Court has reviewed 

the decision in the San Diego case, and the Ninth Circuit’s affirmance of that decision, 

and concludes that collateral estoppel does not apply. 

 On the question of notice, the judge in the San Diego case made a fact-specific 

decision, finding that Greyhound “has provided no less than seven specific instances in 

which either [Greyhound] or a regulatory agency informed [Viad] of the contamination 

plume, and its effect on the area properties (including the Bosa property).” Doc. 70-9 at 

7. The judge relied on specific communications and attachments to conclude that Viad 

was informed of the contamination and its effect on the adjacent property. This decision 

would be controlling if the issues in this case included the same contamination, the same 

adjacent property, and the same communications, but it does not. The alleged notices at 

issue in this case concern different properties, different contamination, and different 

communications. The issues are not identical. 

 Nor can the Court find the San Diego case controlling on whether releases to the 

 1144 (9th Cir. 2009). Collateral estoppel analysis under federal law and Arizona law, 

however, are substantially similar. See Hullett v. Cousin, 63 P.3d 1029, 1034-35 (Ariz. 

2003) (“Collateral estoppel . . . applies when an issue was actually litigated in a previous proceeding, there was a full and fair opportunity to litigate the issue, resolution of the 

issue was essential to the decision, a valid and final decision on the merits was entered, 

and there is a common identity of parties.”). Because the Court finds that collateral 

estoppel would not bar Viad’s claims under either Arizona or federal law, the Court need 

not decide which law governs here. 

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subsurface constitute an Environmental Obligation. In addition to the fact that this too 

was a fact-specific issue in the San Diego case, the judge in that case was not required to 

decide the matter, noting instead that “it is undisputed that the harm at issue (hydrocarbon 

plumes, soil and water contamination) constitute[s] an Environmental Obligation as 

defined in [the parties’] Agreement.” Id. at 6 n.1. The Ninth Circuit likewise noted that 

“Viad concedes that the harm to Bosa’s property constitutes an Environmental Obligation 

within the meaning of the Settlement Agreement[.]” Bosa Dev. of Cal., Inc. v. Shell Oil 

Co., 71 Fed. Appx. 632 (9th Cir. 2003). The issue was not identical and was not actually 

litigated. 

 C. Accord and Satisfaction. 

Greyhound claims that the Settlement Agreement constituted an accord and 

satisfaction that resolved Viad’s claim for recovery of erroneous overpayments and 

Greyhound’s claim for past due indemnity payments. Doc. 91 at 13. According to 

Greyhound, Viad’s agreement to pay the amount owed and Greyhound’s agreement to 

offset the amount of erroneous payments, once carried out, “served to bar an action on 

Viad’s current claim to recover alleged erroneous payments made prior to the 1999 

Settlement.” Id. 

“An accord and satisfaction discharges a contractual obligation or cause of action 

when the parties agree to exchange something of value in resolution of a claim or demand 

and then perform on that agreement, the accord being the agreement, and the satisfaction 

its execution or performance.” Abbott v. Banner Health Network, 372 P.3d 933, 937 

(Ariz. 2016) (internal quotation marks and citation omitted). The elements necessary for 

an accord and satisfaction are the same as those required to form a contract: “(1) A 

proper subject matter, (2) competent parties, (3) an assent or meeting of the minds of the 

parties, and (4) a consideration.” Vance v. Hammer, 464 P.2d 340, 343 (Ariz. 1970). 

The first, second, and fourth elements are not at issue. Viad claims that there was no 

meeting of the minds because the parties did not agree to resolve the matters at issue in 

its counterclaim when they entered into the Settlement Agreement. Doc. 78 at 17. 

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The Court is not persuaded that there was an accord and satisfaction in this case. 

Greyhound cites nothing besides the Settlement Agreement in support of its motion, and 

the Agreement does not contain an express release of all claims for overpayment that 

Viad might have had prior to execution of the Agreement. The Settlement Agreement 

does reflect the parties’ acknowledgement that Viad overpaid Greyhound by $158,435, 

and the parties clearly reached an enforceable contract to resolve this amount in dispute, 

but the Settlement Agreement does not mention any of the other payments that are now at 

issue. Section 1.6 – cited by Greyhound for the first time in its reply brief – does say that 

the parties “have been in dispute about the meanings of certain provisions of [the 

Agreements] regarding liability for environmental matters first identified on or after 

March 1, 1992,” and that the parties “enter into this Agreement to fully and finally 

resolve such dispute.” Doc. 66-13 at 1. But the specific amount then resolved in the 

Agreement is the $158,435 in overpayments mentioned in § 3.3. No other claims are 

discussed or resolved, and the Settlement Agreement specifically states that it “contain[s] 

the entire agreement between the parties[.]” Id. at 5. This limits the Settlement 

Agreement to the claims expressly resolved. Greyhound provides no other evidence of 

an accord and satisfaction.5

 

 D. Economic Loss Doctrine. 

Greyhound argues that Viad’s tort claims for fraud and negligent 

misrepresentation are barred by Arizona’s economic loss doctrine. The economic loss 

doctrine is “a common law rule limiting a contracting party to contractual remedies for 

the recovery of economic losses unaccompanied by physical injury to persons or other 

property.” Flagstaff Affordable Hous. Ltd. P’ship v. Design All., Inc., 223 P.3d 664, 667 

(Ariz. 2010); Apollo Grp., Inc. v. Avnet, Inc., 58 F.3d 477, 479 (9th Cir. 1995) (Applying 

Arizona law and commenting that “[g]enerally, under the ‘economic loss’ rule, a plaintiff 

 

5

 Greyhound does contend that the parties fully reviewed the history of their contractual relationship before entering into the Settlement Agreement. Viad disputes this assertion (Doc. 64 at 20; Doc. 78 at 18), but even if true it would not show that the 

parties arrived at a meeting of the minds on claims not mentioned in the Agreement. 

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who suffers only pecuniary injury as a result of the conduct of another cannot recover 

those losses in tort. Instead, the claimant is limited to recovery under the law of 

contract.”). Economic loss “refers to pecuniary or commercial damage[.]” Flagstaff, 223 

P.3d at 667. As the Arizona Supreme Court emphasized, “[t]he principal function of the 

economic loss doctrine, in our view, is to encourage private ordering of economic 

relationships and to uphold the expectations of the parties by limiting a plaintiff to 

contractual remedies for loss of the benefit of the bargain.” Id. at 671. 

Arizona has not yet considered whether the economic loss doctrine applies to 

cases concerning indemnification contracts. On this issue of first impression, the Court 

“must use [its] best judgment to predict” how the state’s highest court – in this case the 

Arizona Supreme Court – would interpret the doctrine. Burlington Ins. Co. v. Oceanic 

Design & Constr., Inc., 383 F.3d 940, 945 (9th Cir.2004) (citation and internal quotations 

omitted). 

Viad argues that the Arizona Supreme Court has applied the economic loss 

doctrine only to product liability and construction cases, and the Court therefore would be 

improperly expanding the doctrine by applying it here. Doc. 78 at 19 (citing Flagstaff, 

223 P.3d at 66; Atlas Flooring, LLC v. Porcelanite S.A. de C.V., 425 F. App’x 629, 633 

(9th Cir. 2011)). The Court does not find, however, that the Flagstaff decision intended 

to limit the application of the doctrine to product liability and construction cases. Rather, 

the Arizona Supreme Court explained that application of the doctrine to various tort 

claims requires a context-specific analysis that must take into account the policies behind 

contract and tort law. Flagstaff, 223 P.3d at 669. While tort law seeks to promote safety 

and spread the costs of accidents, contract law “seeks to preserve freedom of contract and 

to promote the free flow of commerce.” Id. Thus, if “common law contract remedies 

provide an adequate remedy because they allow recovery of the costs of remedying the 

defects . . . and other damages reasonably foreseeable to the parties upon entering the 

contract[,]” there is no strong policy reason to also provide a tort remedy. Id. 

In 2011, the Arizona Court of Appeals applied the economic loss doctrine to bar 

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tort claims relating to a pest control company’s failure to rid a home of termites after the 

parties had entered into a contract for termite treatment. Cook v. Orkin Exterminating 

Co., 258 P.3d 149, 150 (Ariz. Ct. App. 2011). In addition to breach of contract claims, 

the homeowners brought negligence, misrepresentation, and fraud claims relating to the 

company’s allegedly misleading statements that it could rid their house of termites and 

would repair any damages caused by termites after the treatment. Id. at 153. The Court 

“held that the Cooks are limited to their contractual remedies for purely economic loss 

from Orkin’s alleged failure to adequately perform its promises under the Agreement. 

Because the Cooks are seeking remedies for purely economic loss from Orkin’s alleged 

failure to adequately perform its promises under the Agreement, the [economic loss rule] 

bars their tort claims.” Id. 

Several cases decided by this Court have also predicted that Arizona courts would 

apply the economic loss doctrine outside of construction and product liability cases. This 

Court held that the economic loss doctrine applied to bar tort claims alleging conversion 

and fraud in the performance of a contract for credit card payment processing services. 

TSYS Acquiring Sols., LLC. v. Elec. Payment Sys., LLC, No. CV10-1060 PHX, 2010 WL 

3882518, at *3-4 (D. Ariz. Sept. 29, 2010). In reaching this conclusion, the Court noted 

that the harms alleged in these claims arose directly from the “failure to provide the 

benefit of the parties’ bargain[.]” Id. at *4 (“Because the harm alleged by the conversion 

counterclaim is the failure to receive the property or interest promised by the parties’ 

contract, and not some separate harm, the counterclaim is barred by the economic loss 

rule.”); see also Int’l Franchise Sols. LLC v. BizCard Xpress LLC, No. CV13-0086 PHX 

DGC, 2013 WL 2152549, *3 (D. Ariz. May 16, 2013) (applying the economic loss 

doctrine to bar tort claims alleging negligence and negligent misrepresentation in the 

carrying out of a franchise agreement, finding that “[t]he contract law policy of upholding 

the expectations of the parties would be undermined by allowing BizCard’s tort claims to 

proceed”). 

Another case applied the economic loss doctrine in the context of a supply 

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contract where the defendant agreed to charge the plaintiff prices set in compliance with 

certain enumerated criteria. Maricopa Cty. v. Office Depot, Inc., No. 2:14-CV-1372-

HRH, 2014 WL 6611562, at *1 (D. Ariz. Nov. 21, 2014). The plaintiff brought both tort 

and contract claims against the defendant. Id. at *2. The tort claims alleged that the 

defendant engaged in common law fraud by misrepresenting that the plaintiff was being 

charged the lowest prices of any government entity for office supplies, informing the 

plaintiff that prices had been approved in accordance with contractual terms when they 

had not, and withholding from the plaintiff the fact that it was charging other government 

entities lower prices. Id. at *3. According to the court, “[b]ecause plaintiff’s common 

law fraud claims are based on the same alleged conduct as its contract claims, these 

claims are barred by the economic loss rule.” Id. at *7. 

Viad argues that the harm alleged in its tort claims “results not from a frustration 

of the parties expectations, but from the intentional or negligent concealment of material 

information.” Doc. 78 at 19. Viad argues that this case is distinct from TSYS and Cook

where “the alleged fraud was merely a breach of the promise to perform under the 

parties’ agreements.” Id. at 20. The Court is not persuaded. Viad claims that Greyhound 

committed breach of contract by billing Viad for contamination Viad was not required to 

pay for under the parties’ Agreements. Viad claims that Greyhound committed fraud and 

misrepresentation by billing Viad for the same contamination. Id. at 11, 16, 19-20. The 

wrong is the same: Greyhound’s alleged billing for payments to which it was not entitled 

under the Agreements. The harm is also the same: Viad seeks $2,118,934.27 for its 

contract claims and the same amount for its tort claims. Id. 

Viad provides no reason why contract remedies are inadequate to redress the harm 

it has suffered from Greyhound’s alleged non-compliance with the Agreements. Viad 

and Greyhound are both sophisticated corporate parties, and easily could have provided 

for such risks in their contracts. Limiting Viad to its contract remedies would serve the 

important policy, recognized in Flagstaff, “of encouraging parties to [commercial] 

contracts to allocate risk prospectively and identify remedies within their agreements[.]” 

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TSYS, 2010 WL 3882518, at *2. The Court accordingly concludes that the economic loss 

doctrine applies and will dismiss Viad’s claims for fraud and misrepresentation.6

IV. Viad’s Motion for Summary Judgment.

A. Viad’s Liability under the Agreements. 

 Viad asks the Court to hold that its liability under the Agreements is “limited to 

Viad’s percentage share of costs incurred by Greyhound in remediating contamination 

caused by specific [UST] leaks that Viad was notified of prior to March 1, 1992[.]” 

Doc. 72 at 20. Viad argues that the Agreements, particularly the Third Amendment to the 

Acquisition Agreement, limit its liability to UST leaks. 

 Viad relies on the language of the Agreements, and also on evidence regarding the 

parties’ understanding of and course of dealing under the Agreements. In opposing the 

motion, Greyhound also looks to the language of the Agreements, as well as to other 

evidence that suggests its meaning. Neither party addresses the legal role to be played by 

evidence outside the Agreements; both seem to think that the Court can readily look to 

such evidence in interpreting the Agreements on this summary judgment motion. 

 The only issue to be decided in this order is whether Viad’s interpretation of the 

Agreements is correct as a matter of law and undisputed fact. If it is, summary judgment 

on this issue can be entered for Viad. If it is not, the Court need not attempt to provide a 

definitive interpretation of the Agreements. Greyhound’s motion does not ask the Court 

to adopt its view by summary judgment. 

 The Court concludes that the contract language does not support Viad’s view that 

its environmental liabilities are limited to USTs at the properties. The Court also finds 

that the parties present conflicting evidence regarding their respective understandings of 

the Agreements, requiring a trial to determine the Agreements’ final meaning. The Court 

 

6

 Consistent with the analysis in Flagstaff as applied in TSYS, the Court also notes 

that the injuries allegedly suffered by Viad are not to an interest outside the scope of the parties’ agreements. TSYS, 2010 WL 3882518, at *2. It is squarely within the parties’ Agreements – Viad’s right to pay only for the environmental liabilities assigned to it in the Agreements. Nor did the parties specify in the Agreements that tort remedies would be available in a case such as this. Id. Both of these factors further support application of the economic loss doctrine. Id. 

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will review each of the Agreements and explain why their language does not support 

Viad’s narrow interpretation. 

 The Acquisition Agreement signed in 1986 imposed broad and unrestricted 

indemnification obligations on Viad. Those obligations included “any claim, action, 

proceeding, damage, liability, loss, cost, expenses, judgment, fine, penalty or deficiency . 

. . arising out of, or resulting from or related to . . . [a]ny liability or obligation of [Viad].” 

Doc. 66-10 at 50-51. 

 Three months later, the parties signed the Third Amendment to the Acquisition 

Agreement. Viad relies upon this contract as narrowing its environmental obligations to 

USTs. Section III of the Third Amendment is titled “Environmental Matters” and was 

intended by the parties to “make certain arrangements with respect to certain 

underground storage tanks on properties [covered by the Acquisition Agreement].” 

Doc. 66-11 at 7. 

 Section 3.3 is the key to Viad’s argument. It provides in relevant part that, 

“[n]otwithstanding any provision of the Acquisition Agreement to the contrary, [Viad] 

shall be obligated to bear a proportionate share of any costs, fees, expenses, fines, 

penalties and governmental levies associated with remediation done in respect of leaks 

from the Tanks, and the actual costs or expenses of remediation of the properties where 

the Tanks are located . . . (collectively, the ‘Remediation Expenses’).” Id. at 8. “[Viad’s] 

proportionate share” for these UST expenses “shall be 100% of the Remediation 

Expenses for a period of one year after the Closing Date, and shall decrease linearly 20% 

every year thereafter, such that the Seller is not responsible for any Remediation 

Expenses from and after five years after the Closing Date.” Id. The agreement thus 

includes a step-down process under which Viad’s liability for UST remediation would 

decrease each year, reaching zero after five years. Section 3.3 makes clear that 

“[Greyhound] shall be obligated to bear the remaining share of the Remediation 

Expenses.” Id. 

From this language, and the earlier statement in the Third Amendment explaining 

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that it is intended “to make certain arrangements with respect to certain underground 

storage tanks,” Viad argues that its liability for environmental matters was limited to 

leaking USTs. And because the Third Amendment clearly modified the Acquisition 

Agreement and its broad imposition of liability, Viad argues that UST leaks became its 

only responsibility after the Third Amendment. 

 The problem with Viad’s argument is that it entirely overlooks the plain language 

of section 3.3, as well as section 3.5 of the Third Amendment: 

 Application. This Article supersedes in its entirety any other 

representations, covenants or agreements (including without limitation 

indemnification agreements) contained in the Acquisition Agreement only 

with respect to the matters specifically described in this Article and does 

affect any other representations, covenants or agreements (including 

without limitation indemnification agreements) contained in the 

Acquisition Agreement with respect to any other matter (including without 

limitation other environmental matters). 

Id. at 9 (emphasis added).7

 The highlighted language suggests that the “only” amendment to the Acquisition 

Agreement is with respect to matters “specifically described in this Article [III].” And 

the only matters specifically described in Article III are USTs – those are the specific 

items addressed in sections 3.1 through 3.4 of the article. Nowhere does Viad point to 

language that would suggest that contamination caused by UST leaks was intended to be 

the only contamination for which Viad is responsible. As a result, Viad’s liability for any 

other matter under the Acquisition Agreement, including its broad indemnification 

obligation for other environmental matters, does not appear to be changed. Viad’s 

 

7

 The second clause of § 3.5 does not contain the word “not” between “does” and 

“affect” as would seem to be the natural reading. The Court notes that, as written, the second clause would seem to nullify the first. The language of the first clause is clearly intended to limit the amendment’s effects on the parties’ division of liability to explicit changes contained in Article III. During oral argument, Greyhound indicated that it had always read the provision to include the word “not” in the second clause, and Viad 

similarly had not noticed the absence of the word prior to the Court’s questioning. The Court cannot add a word that is not in the document, but will read the first part of § 3.5 according to its plain meaning so as to avoid an absurd result. Regardless, there is no language in § 3.5 which would suggest an intent to supersede and replace all other assignments of liability made in the Acquisition Agreement. 

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environmental liabilities were narrowed by the Third Amendment, but only in the stepdown process put in place for UST contamination. 

 The foregoing is based solely on the language of the Third Amendment. It does 

not include evidence of the parties’ intent or course of dealing, on which there are factual 

disputes. It is possible that additional evidence will change the Court’s interpretation of 

the agreement. For example, Greyhound conceded during oral argument that it has 

always understood that the step-down process in § 3.3 applies to all of Viad’s 

environmental liabilities under the Agreements, not just those limited to USTs, and that it 

is seeking indemnification from Viad in accordance with this understanding.8

 See also

Doc. 80 at 7. The Court cannot now judge how parol or course of dealing evidence will 

affect its interpretation of the Third Amendment, but it can conclude that the plain 

language of the document does not support Viad’s contention. As a result, the Court 

cannot enter summary judgment in Viad’s favor on this issue, even though later evidence 

may be seen to support Viad’s position. 

 In August 1991, the parties entered into the Claims Treatment Agreement. It too 

limited Viad’s responsibilities, but not to contamination from USTs. Section 14(a) 

provided that “[t]he environmental indemnities in the Acquisition Agreement shall be 

modified as follows: [Viad] shall have no obligation to indemnify [Greyhound] for any 

liabilities for environmental matters or claims, regardless of when the acts giving rise to 

liability occurred, and [Greyhound] shall assume all such environmental obligations and 

indemnities, except . . . indemnities arising from liabilities which are identified prior to 

March 1, 1992.” Doc. 66-12 at 11 (emphasis added). The agreement further provided 

that the liabilities identified before March 1, 1992 “shall continue to be governed by the 

Acquisition Agreement” (id.), which is defined to include the Third Amendment. Id. at 

2. Thus, the Claims Treatment Agreement narrowed Viad’s environmental liability under 

the Acquisition Agreement and Third Amendment in only one respect, limiting it to 

 

8

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liabilities “identified” before March 1, 1992. 

 Eight years later, the parties’ 1999 Settlement Agreement added some relevant 

definitions to the Agreements. It defines “Environmental Obligations” as follows: 

The term “Environmental Obligations” shall mean any and all liabilities 

and obligations, whether statutory, regulatory, contractual, legal, financial 

or otherwise, relating to the physical or environmental condition of a 

Property (as defined below), including but not limited to the presence, use 

or release of Hazardous Materials (as defined below) at a Property, the 

migration of Hazardous Materials to or from a Property, the transportation 

of Hazardous Materials from a Property, or off-site disposal of Hazardous 

Materials which were kept, used or stored at a Property, regardless of 

whether such liability or obligation is predicated upon tort, contract, strict 

liability, warranty, Superfund . . . or any other state or federal statute, law, 

ordinance, or other basis of liability for damage to the environment. 

Doc. 66-13 at 2. 

 This definition is important in two respects. First, it appears to be as broad as the 

virtually unlimited obligations Viad assumed in the Acquisition Agreement. Second, it is 

not limited to contamination from USTs. If the parties understood at the time that Viad 

was responsible only for UST contamination, that fact presumably would have been 

included in this definition. Viad notes, correctly, that Greyhound is the party primarily 

made responsible for Environmental Obligations in the Settlement Agreement, but that 

contract also imposes liability on Viad, and uses the phrase Environmental Obligations 

when defining Viad’s liability, as will be shown below. 

 The Settlement Agreement also defined “Notified,” a term of some importance in 

this litigation: 

[Viad] shall have been “Notified” about an Environmental Obligation only 

if: (a) the existence or nature of the Environmental Obligation has been 

reasonably disclosed in writing: (i) by Greyhound to [Viad], or (ii) by a 

state or federal environmental regulatory agency to [Viad], or (b) [Viad] 

has addressed or has been addressing such Environmental Obligations by 

way of site assessment, testing or remediation. 

Id. at 2-3. 

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 The Settlement Agreement then amends paragraph 14(a) of the Claims Treatment 

Agreement to make it consistent with these new definitions: 

[Viad] shall have no obligation to indemnify [Greyhound] for any liabilities 

for Environmental Obligations with respect to Properties, regardless of 

when the acts giving rise to liability occurred, and [Greyhound] shall 

assume all such Environmental Obligations and indemnities with respect to 

all Properties, except (A) indemnities arising from Environmental 

Obligations which [Viad was] Notified about prior to the Effective Date. 

The foregoing exception (A) shall continue to be governed by the Amended 

Acquisition Agreement[.] . . . In addition, Greyhound shall indemnify 

[Viad] with respect to Environmental Obligations relating to Properties sold 

to [Greyhound] which [Viad was] not Notified about prior to the Effective 

Date. 

Id. at 3. 

The “Effective Date” in this provision is the cut-off date established in the Claims 

Treatment Agreement – March 1, 1992. The Settlement Agreement thus preserves the 

temporal limitation on Viad’s liability established in the Claims Treatment Agreement. It 

also makes the cut-off more precise, stating that Viad must have been “Notified” of the 

liability by that date, as opposed to the Claims Treatment Agreement’s provision that the 

liability merely needed to have been “identified” by that date. But this contract does not 

limit the broad environmental liabilities that Viad assumed in the Acquisition Agreement, 

carried forward in the Third Amendment, and limited only temporally in the Claims 

Treatment Agreement. 

 The Court thus rejects Viad’s argument that the language of the Agreements limits 

its liability to contamination from USTs. As noted above, the parties provide additional 

evidence to support their respective interpretations of the language, but the Court finds 

that this evidence creates a factual dispute that precludes summary judgment. The Court 

therefore will deny Viad’s motion for summary judgment that asks the Court to adopt its 

narrow interpretation of the Agreements. The Court expresses no view on whether 

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Greyhound’s expansive reading of the Agreements is correct.9 

 Viad also presents factual evidence regarding the specific environmental liabilities 

of which it received notice before March 1, 1992. Viad asks the Court to hold that its 

legal obligations are limited to these liabilities. Greyhound presents controverting 

evidence that raises a question of fact regarding the notices Viad received before the cutoff date, precluding summary judgment. In addition, Viad’s arguments regarding the 

import of this evidence assume that the Court agrees with its narrow reading of the 

Agreements. The evidence from both sides will need to be addressed in light of the 

Court’s conclusions set forth above. 

 B. Viad’s Liability under CERCLA and MTCA. 

 Both parties agree, and the Ninth Circuit has made clear, that private agreements 

can allocate potential liability under CERCLA. Jones-Hamilton Co. v. Beazer Materials 

& Servs., Inc., 973 F.2d 688, 692 (9th Cir. 1992). As Greyhound notes, any responsible 

party under CERCLA may be held liable to the government, but courts will enforce 

contractual allocations of liability between private parties. Id. Similarly, Washington 

courts have found that private parties may contractually allocate MTCA liability. See, 

e.g., Car Wash Enterprises, Inc. v. Kampanos, 874 P.2d 868, 873 (Wash. 1994). Thus, it 

appears clear that Viad’s CERCLA and MTCA liabilities in this case will be controlled 

by the limitations in the Agreements. As a result, if all of Viad’s liabilities under the 

Agreements are subject to the step-down process, as Greyhound appears to concede, 

Viad’s indemnification responsibility for liabilities under CERCLA and MTCA will also 

be subject to the step-down process. 

The parties appear to disagree on two points: whether Viad can be held liable for 

 

9

 The parties should consider Arizona’s unique parol evidence rule when deciding what evidence to present at trial. The Arizona Supreme Court has adopted a more liberal interpretation of the parol evidence rule than many courts. “[T]he judge first considers the offered evidence and, if he or she finds that the contract language is ‘reasonably susceptible’ to the interpretation asserted by its proponent, the evidence is admissible to 

determine the meaning intended by the parties.” Taylor v. State Farm Mut. Auto. Ins. 

Co., 854 P.2d 1134, 1140 (Ariz. 1993). Arizona does not adhere to the view “that 

ambiguity must exist before parol evidence is admissible.” Id. 

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anything other than UST contamination, and whether Viad received notice of specific 

instances of contamination before the March 1, 1992 cut-off date. The Court has found 

that Viad’s position on the first issue cannot be justified solely on the language of the 

Agreements, and that additional evidence concerning the meaning of the Agreements 

must be considered at trial. The Court also finds that factual disputes prevent the Court 

from entering summary judgment on the second question – whether Viad received notice 

of specific instances of contamination before the cut-off date.

 C. Sale of the Seattle and Miami Properties. 

Viad contends that purchase price reductions granted by Greyhound for the Seattle 

and Miami properties are not recoverable. Doc. 72 at 16-19. Citing the Third 

Amendment, Viad argues that its liability is limited to indemnification for “actual costs” 

of “remediation done.” Id. But the Court, looking solely to the plain language of the 

text, has already found that the Third Amendment limited Viad’s liability only by 

imposing a step-down process for UST contamination; it did not otherwise alter Viad’s 

broad environmental obligations as established in the Acquisition Agreement. Those 

obligations, as defined more precisely in the Settlement Agreement, include “any and all 

liabilities and obligations, whether statutory, regulatory, contractual, legal, financial, or 

otherwise, relating to the . . . environmental condition of a Property.” Doc. 66-13 at 2 

(emphasis added). Because the price reductions granted by Greyhound might be viewed 

as a contractual liability relating to environmental conditions at the Seattle and Miami 

properties, the language of the Settlement Agreement may be broad enough to encompass 

Greyhound’s reimbursement claim. The Court therefore cannot grant summary judgment 

on this issue. The precise scope of the Agreements in light of parol evidence, the precise 

nature of the price reductions granted by Greyhound on sale of the Seattle and Miami 

properties, and whether those reductions fit within the language of the Agreements, are 

matters that must be addressed at trial. Summary judgment cannot resolve this issue.10 

 

10 Greyhound conceded in oral argument that the step-down process applies to the purchase price reductions. The Court finds this position confusing. On one hand, Greyhound is claiming that Viad’s liability is defined by the broad language in the 

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 Because Viad’s CERCLA and MTCA liability will be limited by the Agreements, 

there is no circumstance under which Greyhound can recover sums under these statutes 

that exceed the agreed-upon limitations of the Agreements. The Court therefore need not 

decide whether the price reductions qualify as recoverable costs under CERCLA and the 

MTCA. 

 D. Statute of Limitations. 

 Viad argues that Greyhound’s claim to recover the $5.95 million purchase price 

reduction for the Seattle property is barred by the six-year statute of limitations in A.R.S. 

§ 12-548. Doc. 72 at 19. It is undisputed that Greyhound submitted a reimbursement 

request for the Seattle price reduction on April 21, 2009. On May 5, 2009, Ken Ries 

responded to the request by asking: “[w]hat in the world is going on here?” Doc. 73, 

¶ 50; Doc. 80 at 23. Greyhound followed up on this request for reimbursement on 

September 16, 2009 and June 3, 2010. Doc. 66, ¶ 50; Doc. 89, ¶ 50. There is some 

dispute as to whether Viad responded to Greyhound’s inquiries and whether Greyhound 

provided requested information concerning the reimbursement. Doc. 66, ¶¶ 47-70; 

Doc. 89, ¶¶ 47-70. 

 Greyhound brought suit on September 11, 2015, some six years and five months 

after the initial demand. Doc. 73 at 51; Doc. 90 at 51. Greyhound contends that it was 

common for Viad to take several months to review and make payment in response to a 

reimbursement request, and claims that it had no reason to know Viad was breaching its 

agreement until at least June 2010 when Viad failed to respond to Greyhound’s second 

demand. Doc. 66, ¶ 46. Viad disputes that it routinely delayed payment (Doc. 89, ¶ 46), 

but identifies no date on which it was required to pay a reimbursement request under the 

Agreements. 

 The parties disagree on the nature of their course of dealing and when that course 

 Settlement Agreement. On the other hand, Greyhound concedes that the same liability is subject to the step-down process in § 3.3 of the Third Amendment, even though that section is limited to USTs. The Court does not understand how that broad liability defined in the Settlement Agreement fits into § 3.3. Evidence at trial concerning the parties’ understanding and course of dealing hopefully will clear up the confusion. 

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should have alerted Greyhound to the fact that Viad was refusing to pay. The Court 

concludes that a factual dispute precludes summary judgment on this issue. As noted 

above, “[w]hen discovery occurs and a cause of action accrues are usually and 

necessarily questions of fact for the jury.” Doe, 955 P.2d at 961; Walk, 44 P.3d at 996. 

IT IS ORDERED: 

1. Greyhound’s motion for summary judgment (Doc. 64) is granted as to the 

 fraud and misrepresentation claims, and denied as to all other claims. 

 2. Viad’s motion for partial summary judgment (Doc. 72) is denied. 

 3. The Court will hold a status conference with the parties on 

December 2, 2016, at 11:00 a.m. The purpose of the conference will be to 

determine the next step in this case and how best to bring it to resolution. 

The parties should confer before the conference to see if they can reach 

agreement on how best to proceed. 

 Dated this 21st day of November, 2016. 

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