UNITED STATES DISTRICT COURT EASTERN DISTRICT OF …ace-insurance-litigation.com/sites/default/files/United States of... · NOW COMES Plaintiff, UNITED STATES OF AMERICA for the use

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF TENNESSEE

UNITED STATES OF AMERICA for the )

use of RAGAN MECHANICAL, INC., )

)

Plaintiffs, )

)

v. ) NO.:

)

APPLIED ENERGY MANAGEMENT, INC., )

and WESTCHESTER FIRE INSURANCE )

COMPANY, )

)

Defendants. )

COMPLAINT

NOW COMES Plaintiff, UNITED STATES OF AMERICA for the use of RAGAN

MECHANICAL, INC. (APlaintiff@), by and through counsel, and for its Complaint against the

Defendants states:

1. This action arises under 40 U.S.C. ''3131 - 3134, commonly known as the

AMiller Act.@

2. Defendant, APPLIED ENERGY MANAGEMENT, INC. (AAEM@), is a

Massachusetts corporation authorized to do business in Tennessee that maintains its principal office

at 16810 Kenton Drive, Suite 240, Huntersville, North Carolina 28078. A copy of the summons and

complaint may be served upon AEM via its registered agent for service of process, CT Corporation,

800 S. Gay Street, Ste 2021, Knoxville, Tennessee 37929.

3. Defendant, WESTCHESTER FIRE INSURANCE COMPANY

(AWestchesterA), a Pennsylvania corporation, maintains its principal place of business at 436 Walnut

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Street, Philadelphia, Pennsylvania. Westchester is, upon information and belief, in the business of,

inter alia, issuing surety bonds on public projects. Pursuant to Tenn. Code. Ann. § 56-2-504,

Westchester can be served with process by forwarding the summons and complaint to its statutory

agent, the Tennessee Commissioner of Commerce and Insurance, 500 James Robertson Parkway, 5th

Floor, Nashville, Tennessee 37243.

4. Upon information and belief, AEM was at all relevant times the contractor

under a certain Agreement with Johnson Controls, Inc., the General Contractor for a project

commonly known as the AMelton Valley Steam Plant@ for the construction of a steam plant at Oak

Ridge National Laboratory (“ORNL”) located in Oak Ridge, Tennessee.

5. Westchester furnished a performance and payment bond to the United States

(the “Bond”) and is now a surety under a contract between Johnson Controls, Inc., and the United

States. A copy of said Bond is attached to this Agreement, marked Exhibit AA@ and made a part

hereof.

6. On or about November 1, 2009, Plaintiff and AEM entered into a Subcontract

providing that Plaintiff would provide supervision, labor, material and equipment for the

construction of the Melton Valley Steam Plant ORNL. A copy of said Subcontract is attached

hereto, marked Exhibit AB@ and made a part hereof. (ASubcontract@)

7. On the dates shown herein, Plaintiff and AEM, in accordance with the terms

of the Subcontract, modified the Subcontract between themselves as follows:

a. By Contract dated December 30, 2009, Plaintiff agreed to perform additional service and provide additional material in exchange for an additional payment of $32,237.00 by AEM.


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b. By Contract dated December 18, 2009, Plaintiff agreed to perform

additional service and provide additional material in exchange for additional payment of $203,888.00.

c. By Contract dated January 22, 2010, Plaintiff agreed to provide

additional service and provide additional material in exchange for additional payment of $12,176.00.

d. By Contract dated May 11, 2010, Plaintiff agreed to provide additional

service and provide additional material in exchange for additional payment of $6,583.74.

e. By Contract dated May 11, 2010, Plaintiff agreed with AEM to

provide additional service and material in exchange for the payment by AEM in the amount of $69,856.90.

f. By Contract dated May 11, 2010, Plaintiff agreed with AEM to

provide additional service and material in exchange for the payment by AEM in the amount of $4,974.00.

g. By Contract dated May 11, 2010, Plaintiff agreed to provide additional

service and material in exchange for the payment by AEM in the amount of $10,725.00.

Copies of the written change orders set forth above are attached here to as Collective Exhibit "C".

8. On or about the date of each of the above-mentioned amendments to the

Subcontract with AEM, Plaintiff began the additional work to be completed and finished in

accordance with plans and specifications and has performed and completed all conditions of the

Subcontract as modified by the amendments referenced in Paragraph 7 hereof.

9. After application of all credits, AEM now owes Plaintiff herein the sum of

$287,624.09, which amount AEM refuses to pay in violation of its contractual obligations despite

Plaintiff=s demand for payment.


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10. The Subcontract between Plaintiff and AEM provides in pertinent part:

If either Party is required to commence legal proceedings to enforce any provisions of this Agreement or to protect its interests in any manner arising under this Agreement, the Party prevailing in such proceedings shall be entitled to reimbursement for all reasonable costs and expenses, including attorney=s fees, included in such proceeding. Any dispute concerning the amount of such fees, costs, and expenses to which the prevailing Party is entitled shall be independent of the dispute that gave rise to the entitlement and its resolution shall be subject to the Disputes clause of this Agreement.

11. Plaintiff has incurred attorney fees in these proceedings.

12. More than ninety (90) days have elapsed since Plaintiff last supplied labor and

materials. Less than one (1) year has elapsed since the last materials and/or labor was supplied.

13. All conditions precedent for bringing this action have been performed or

occurred. A copy of the Notice to Johnson Controls, Inc., General Contractor and Westchester, the

bond company, as required by statute is attached hereto, marked Exhibit “D”, and made a part hereof.

WHEREFORE, the UNITED STATES OF AMERICA on behalf and to the use of RAGAN

MECHANICAL, INC., requests judgment against Defendants, APPLIED ENERGY

MANAGEMENT, INC., and WESTCHESTER FIRE INSURANCE COMPANY and in favor of

RAGAN MECHANICAL, INC., in the amount of $287,624.09, plus pre-judgment interest as

provided by law plus reasonable attorney fees incurred and all taxable costs of this action.


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UNITED STATES OF AMERICA for the use of RAGAN MECHANICAL, INC., Plaintiffs,

s/Meghan H. Morgan

P. Edward Pratt, Esq. (BPR #12758) Meghan H. Morgan, Esq. (BPR # 024619) Baker, Donelson, Bearman, et al. 265 Brookview Centre Way Suite 600 Knoxville, Tennessee 37919 (865) 549-7000 [email protected] [email protected]

Of Counsel: Philip E. Koenig, (IL BPR #149806) Attorney at Law 1515 - 4th Avenue Suite 201 Rock Island, Illinois 61201 (309) 788-0743


mailto:[email protected]

mailto:[email protected]

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JS44 (Rev. 11/04)

CIVIL COVER SHEET The JS-44 civil cover sheet and the information contained herein neither replace nor supplement the filing and service of pleadings or other papers as required by law, except as provided by local rules of court. This form, approved by the Judicial Conference of the United States in September 1974, is required for the use of the Clerk of Court for the purpose of initiating the civil docket sheet. (SEE INSTRUCTIONS ON THE REVERSE OF THE FORM.)

I. (a) PLAINTIFFS DEFENDANTS United States of America for the use of Ragan Mechanical, Inc.

Applied Energy Management, Inc. and Westchester Fire Insurance Company

(b) COUNTY OF RESIDENCE OF FIRST LISTED PLAINTIFF COUNTY OF RESIDENCE OF FIRST LISTED DEFENDANT North Carolina (EXCEPT IN U.S. PLAINTIFF CASES) (IN U.S. PLAINTIFF CASES ONLY)

NOTE: IN LAND CONDEMNATION CASES, USE THE LOCATION OF THE TRACT OF LAND INVOLVED

(c) ATTORNEYS (FIRM NAME, ADDRESS, AND TELEPHONE NUMBER) ATTORNEYS (IF KNOWN)

P. Edward Pratt/Meghan Morgan Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C. 265 Brookview Centre Way Suite 600 Knoxville, TN 37919; (865) 549-7000

Philip Koenig 1515 4

th Avenue, Suite 201

Rock Island, IL 61201 (309) 788-0743

Terrill L. Adkins Trammell, Adkins & Ward, P.C. 128 Northshore Dr., Suite 201 Knoxville, TN 37919

III. CITIZENSHIP OF PRINCIPAL PARTIES (PLACE AN “X” IN ONE BOX FOR PLAINTIFF

(For Diversity Cases Only) AND ONE BOX FOR DEFENDANT)

PTF DEF

PTF DEF

Citizens of This State 1 1 Incorporated or Principal Place Of Business in This State

4 4

Citizens of Another State 2 2 Incorporated and Principal Place Of Business in Another State

5 5

II. BASIS OF JURISDICTION (PLACE AN x IN ONE BOX ONLY)

X 1 U.S. Government 3 Federal Question

Plaintiff (U.S. Government Not a Party)

2 U.S. Government 4 Diversity

(Indicate Citizenship of Parties in Item III)

Citizens or Subject of a Foreign County

3 3 Foreign Nation 6 6

IV. NATURE OF SUIT (PLACE AN X IN ONE BOX ONLY) CONTRACT TORTS FORFEITURE/PENALTY BANKRUPTCY OTHER STATUTES

422 Appeal 28 USC 158

423 Withdrawal 28 USC 157

PROPERTY RIGHTS

610 Agriculture

620 Other Food & Drug

625 Drug Related Seizure of Property 21 USC 881

630 Liquor Laws

640 R.R. & Truck

650 Airline Regs

660 Occupational Safety/Health

690 Other

820 Copyrights

830 Patent

840 Trademark

LABOR SOCIAL SECURITY

110 Insurance 120 Marine

X 130 Miller Act

140 Negotiable Instrument 150 Recovery of Overpayment

of Veteran’s Benefits 151 Medicare Act 152 Recovery of Defaulted

Student Loans (Excl. Veterans)

153 Recovery of Overpayment of Veteran’s Benefits

160 Stockholders’ Suits 190 Other Contract 195 Contract Product Liability 196 Franchise

PERSONAL INJURY 310 Airplane 315 Airplane Product

Liability 320 Assault, Libel & Slander 330 Federal Employers’

Liability 340 Marine 345 Marine Product Liability 350 Motor Vehicle 355 Motor Vehicle Product

Liability 360 Other Personal Injury

PERSONAL INJURY 362 Personal Injury – Med

Malpractice 365 Personal Injury – Product

Liability 368 Asbestos Personal Injury

Product Liability

PERSONAL INJURY

370 Other Fraud

371 Truth in Lending

380 Other Personal Property Damage

385 Property Damage Product Liability

710 Fair Labor Standards Act

720 Labor/Mgmt. Relations

730 Labor/Mgmt. Reporting & Disclosure Act

861 HIA (1395ff)

862 Black Lung (923)

863 DIWC/DIWW (405(g))

864 SSID Title XVI

865 RSI (405(g))

REAL PROPERTY CIVIL RIGHTS PRISONER PETITIONS 740 Railway Labor Act FEDERAL TAX SUITS

210 Land Condemnation

220 Foreclosure

230 Rent Lease & Ejectment

240 Torts to Land

245 Tort Product Liability

290 All Other Real Property

441 Voting

442 Employment

443 Housing/ Accommodations

444 Welfare

440 Other Civil Rights

510 Motions to Vacate Sentence

HABEAS CORPUS: 530 General

535 Death Penalty

540 Mandamus & Other

550 Civil Rights

555 Prison Condition

790 Other Labor Litigation

791 Empl. Ret. Inc. Security Act

870 Taxes (U.S. Plaintiff or Defendant)

871 IRS – Third Party 28 USC 7609

400 State Reapportionment

410 Antitrust

430 Banks and Banking

450 Commerce

460 Deportation

470 Racketeer Influenced and Corrupt Organizations

480 Consumer Credit

490 Cable/Sat. TV

810 Selective Service

850 Securities/Commodities/ Exchange

875 Customer Challenge 12 USC 3410

890 Other Statutory Actions

891 Agricultural Acts

892 Economic Stabilization Act

893 Environmental Matters

894 Energy Allocation Act

895 Freedom of Information Act

900 Appeal of Fee Determination Under Equal Access to Justice

950 Constitutionality of State Statutes

V. ORIGIN (PLACE AN X IN ONE BOX ONLY) Appeal to District X 1 Original

Proceeding 2 Removed from

State Court 3 Remanded from

Appellate Court 4 Reinstated or

Reopened 5 Transferred from

Another District (Specify)

6 Multidistrict Litigation

7 Judge from Magistrate Judgment

CITE THE U.S. CIVIL STATUTE UNDER WHICH YOU ARE FILING (DO NOT CITE JURISDICTIONAL STATUTES UNLESS DIVERSITY):

40 U.S.C. 3131-3134

BRIEF DESCRIPTION OF CAUSE:: MILLER ACT CLAIM

VII. REQUESTED IN COMPLAINT

CHECK IF THIS IS A CLASS ACTION

UNDER F.R.C.P. 23

DEMAND $287,624.09

Check YES only if demanded in complaint:

JURY DEMAND: YES NO

VIII. RELATED CASE(S) IF ANY (See instructions)

DATE SIGNATURE OF ATTORNEY OF RECORD

May 3, 2011____________________________________________ _s/ Meghan H. Morgan FOR OFFICE USE ONLY RECEIPT # AMOUNT APPLYING IFP JUDGE MAG. JUDGE

VI. CAUSE OF ACTION

Judge ________________________________ DOCKET NUMBER ___________________________


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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF TENNESSEE

UNITED STATES OF AMERICA for the )

use of RAGAN MECHANICAL, INC., )

)

Plaintiff, )

)

v. ) No. _______________

)

APPLIED ENERGY MANAGEMENT, INC. )

and WESTCHESTER FIRE INSURANCE )

COMPANY, )

)

Defendants. )

DISCLOSURE STATEMENT

I, the undersigned, counsel of record for Ragan Mechanical, Inc., certify to the best of my

knowledge and belief:

X My client has no corporate interests to be certified under Federal Rule of Civil Procedure

7.1 or Federal Rule of Criminal Procedure 12.4.

� My client has the following parent corporation(s):

� The following publicly held corporation(s) own 10% or more of my client's stock:

s/ Meghan H. Morgan

(Signature of Counsel)

May 3, 2011

(Date)


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CERTIFICATE OF SERVICE

The undersigned hereby certifies that on May 3, 2011, a true and exact copy of the

foregoing Disclosure Statement was filed electronically. Notice of this filing will be sent by

operation of the Court's electronic filing system to all parties indicated on the electronic filing

receipt. All other parties will be served by electronic mail, hand delivery or regular U.S. mail.

Parties may access this filing through the Court's electronic filing system.

Terrill L. Adkins

Trammell, Adkins & Ward, P.C.

128 Northshore Dr., Suite 201

Knoxville, TN 37919

s/ Meghan H. Morgan

Attorney






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UNITED STATES DISTRICT COURT EASTERN DISTRICT OF …ace-insurance-litigation.com/sites/default/files/United States of... · NOW COMES Plaintiff, UNITED STATES OF AMERICA for the use