Scotts attorney asks court to vacate $7.4 million seed ruling

A motion to vacate a $7,448,103 ruling against Scotts Inc. was filed Friday in Whitman County Superior Court by an attorney with the Seattle law firm which has represented Scotts in the case which involves payments to area grass seed producers.

In the Jan. 21 ruling, Seeds Inc., Tekoa, was awarded the partial summary judgment for sums said due from Scotts under terms of contracts for Kentucky Bluegrass seed harvested in 2010.

Seeds Inc. sought the partial summary judgment in a cross complaint after growers sued Seeds, Scotts and Dye Seed Ranch of Pomeroy for payment of sums alleged due under terms of growers’ contracts. The sums were ruled due for partial payments which had not been made by Scotts under terms of contracts for the 2010 crops.

The payments, based on calculation of the seed crop, which had yet to be processed, were due in September and December.

Filed by Seattle attorney Colin Folawn, Friday’s motion to vacate the ruling contends the court erred when it denied a Scotts motion for continuance before the Jan. 21 ruling. The motion contends Scotts needed the extra time to document its argument that sums allegedly due were based on invalid crop estimates.

Folawn filed an affidavit which said 31,042 documents have been received by Scotts which would have been used in their contention that the crop estimates were invalid. Of the total, he noted 13,613 of the documents were received Feb. 3, too late to be presented in the motion which was heard by the court Jan. 3.

The documents derived from an October audit of Seeds records which was conducted by accountants on behalf of Scotts.

Scotts has contended the drop in spot market prices for Kentucky Bluegrass, caused by the slump in the real estate market, led growers to deliver seed from non-contracted fields for payment under the higher price in the standing contracts.

In his Jan. 21 ruling, Judge David Frazier said the contracts for the 2010 crop did include a provision which allowed Scotts to conduct an audit of Seeds records, but the judge ruled the audit provision was not included in the contract as pre-condition for payment. He ruled Scotts was obligated to make September and December partial payments on the estimated total crop.

Friday’s motion also contended the court incorrectly shifted the burden of proof to Scotts. The motion for the partial summary judgment was filed by Pullman Attorney Timothy Esser on behalf of Seeds, Inc.

Folawn’s motion Friday also contended “opinion testimony” from Scotts executives, who filed declarations about their beliefs that seed production exceeded the harvest from fields under contract, created a sufficient basis for denying the motion.

During his ruling, Judge Frazier read portions of the declarations from Scotts executives and pointed out they lacked any factual basis to support an argument for not complying with terms of the payment contracts.

A hearing on the motion has been scheduled for Feb. 25.

The summary judgment ruling here was granted to Seeds on their motion and does not include the third defendant, Dye Seed.

In another filing Monday, attorneys for all sides filed an agreement under which use of business records involved in the suit would be restricted to the litigation at hand. Under terms of the agreement, any party could designate records “confidential” or “proprietary information” which would make them subject to the agreed restrictions.