United States District Court, S.D. Indiana, Indianapolis Division
ENTRY ON CROSS-MOTIONS FOR SUMMARY JUDGMENT
WALTON PRATT, JUDGE
matter is before the Court on cross-motions for summary
judgment filed pursuant to Federal Rule of Civil Procedure 56
by Defendants Town of Nashville ("Nashville"),
Charles King, Jane Gore, Alisha Jacoba, Arthur Omberg, and
Dave Rudd (collectively, "Defendants") (Filing
No. 57). and Plaintiff Brown County Water Utility, Inc.
("Brown County Water") (Filing No. 63).
Also pending is Defendants' Objection to Undisclosed
Expert Opinion (Filing No. 67). Brown County Water
initiated this litigation alleging the Defendants are
encroaching upon its water service rights, in violation of 7
USC 1926(b). Defendants filed a motion for summary judgment,
contending they are entitled to judgment as a matter of law
because Brown County Water is encroaching on their water
service rights. Brown County Water filed a cross motion
making a similar argument. For the following reasons, the
Court denies the cross-motions for summary
judgment and overrules the Defendants'
Objection to Undisclosed Expert Opinion.
case involves the parties' dispute as to which entity is
allowed under federal regulation to provide water services to
a property located in Brown County, Indiana ("Brown
property at issue in this case is located in Brown County in
an area commonly known as Firecracker Hill. The property is
east of Greasy Creek Road and Memorial Drive, south of
Creamer Road, and north of Old State Road 46. In December
2016 a new customer, Big Woods Brewing Co. LLC ("Big
Woods"), purchased two undeveloped parcels and began
constructing a distillery, brewery, restaurant and event
center on the property on Firecracker Hill. Big Woods
completed construction on key phases by December 2017 and
August 2018 and the restaurant and other facilities are
presently open. (Filing No. 31-2 at 1-2, 6-7;
Filing No. 58-4 at 2; Filing No. 64-6 at 3,
15; Filing No. 64-7 at 4; Filing No. 64-8 at
4). Big Woods requires a six-inch water main to
adequately service its facilities with water. (Filing No.
5-4 at 2).
County Water is a federally-indebted, rural not-for-profit
corporation in the business of supplying water to customers
in and surrounding Brown County, Indiana (Filing No. 49
at 1). When this lawsuit began in early 2017, Brown
County Water had 5, 339 customers and provided water to its
customers who are located throughout most of Brown County and
parts of Bartholomew County, Johnson County, Morgan County,
and Monroe County (Filing No. 5-3 at 2).
town of Nashville is an Indiana municipality located in Brown
County, and individual Defendants Charles King, Jane Gore,
Alisha Jacoba, Arthur Omberg, and Dave Rudd are members of
the Nashville Town Council (Filing No. 49 at 2). In
1977, Nashville obtained $568, 000.00 in funding from the
United States Department of Agriculture to complete a project
involving the construction of 75, 000 feet of new
distribution mains, and as part of the project, Nashville
installed a six-inch water main along Old State Road 46
directly in front of the property at issue in this case
(Filing No. 31-1 at 1-2; Filing No. 58-1 at
December 2010, Brown County Water financed significant
improvements to its infrastructure through federal loans
issued by the United States of America, acting by and through
the Rural Development Agency of the United States Department
of Agriculture ("USD A"). As of December 2016,
Brown County Water was indebted to the USDA in the amount of
$4, 973, 674.92 and was making monthly payments of $19,
533.00. The longest term of Brown County Water's federal
loans will mature in December 2050 (Filing No. 5-3 at
1-2; Filing No. 5-1 at 1-2).
3, 2016, the USDA issued to Nashville a "letter of
conditions" for a $1, 220, 000.00 federal loan for a
project that included installation of an automated meter
reading system, which would be used to service
Nashville's water mains including the six-inch water main
along Old State Road 46 (Filing No. 31-1 at 2,
18-19; Filing No. 58-3 at 2-3). The letter of
conditions provided that the "loan/grant will be
considered approved on the date Form RD 1940-1, 'Request
for Obligation of Funds,' is signed by the approving
official," (Filing No. 31-1 at 19), and the
approving official signed Form RD 1940-1 on June 3, 2016
(Filing No. 70-3). The USDA had previously provided
Nashville with approximately $26, 625.00 in pre-planning
grant funds for the project in 2016 (Filing No. 31-1 at
2. 18-20). On October 10, 2018, the USDA loaned
Nashville $967, 000.00 for its project (Filing No.
annexed the Big Woods property on April 20, 2017, and passed
an ordinance to establish the property as within its
exclusive water service area on May 15, 2017 (Filing No.
5-8 at 2-3; Filing No. 5-12 at 2-3). Nashville
then entered into a contract with Big Woods on May 18, 2017,
to provide water services to the property (Filing No.
58-2 at 23-28). In July 2017, Nashville connected its
six-inch water main along Old State Road 46 to the property
and began providing water service to the property (Filing
No. 31-2 at 2). On February 7, 2018, Nashville received
approval from the Indiana Utility Regulatory Commission
("IURC") to establish the property as within its
exclusive water service area (Filing No. 58-5).
20, 2017, two months after Nashville annexed the Big Woods
property but shortly before the town connected its water main
to the property and began providing water services, Brown
County Water filed this lawsuit, alleging that its water
service area included the Big Woods property, and Nashville
was encroaching on its service area (Filing No. 1).
County Water began providing water services to a customer
adjacent to what would become the Big Woods property (the
"Reichman property") beginning in February 1974.
Brown County Water provided water to the Reichman property
and the surrounding area through a two-inch water main. After
initiating this lawsuit, Brown County Water upgraded its
two-inch water main to a six-inch water main, completing the
upgrade on August 10, 2017, and placing the water main into
service on August 15, 2017. This existing six-inch water main
runs along Greasy Creek Road and Weddle Lane and runs to the
Big Woods property line through an easement on the Reichman
property. The connection point is approximately 1, 050 feet
from Big Woods' facilities through the Big Woods
property. As of September 2018, Brown County Water was
serving seventy-seven customers within a half-mile radius of
the Big Woods property (Filing No. 64-2 at 2-3;
Filing No. 64-3 at 2-3; Filing No. 64-6 at
County Water initiated this lawsuit, seeking injunctive
relief and a declaratory judgment that the Big Woods property
is in Brown County Water's federally-protected service
area and that Nashville is prohibited from providing water
service to Big Woods. After months of unsuccessful efforts to
resolve their dispute, the parties filed cross-motions for
summary judgment concerning their rights to provide water
services to the Big Woods property.
SUMMARY JUDGMENT STANDARD
purpose of summary judgment is to "pierce the pleadings
and to assess the proof in order to see whether there is a
genuine need for trial." Matsushita Elec. Indus. Co.
v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). Federal
Rule of Civil Procedure 56 provides that summary judgment is
appropriate if "the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to
any material fact and that the moving party is entitled to a
judgment as a matter of law." Hemsworth v.
Quotesmith.com, Inc., 476 F.3d 487, 489-90 (7th Cir.
2007). In ruling on a motion for summary judgment, the court
reviews "the record in the light most favorable to the
non-moving party and draw[s] all reasonable inferences in
that party's favor." Zerante v. DeLuca, 555
F.3d 582, 584 (7th Cir. 2009) (citation omitted).
"However, inferences that are supported by only
speculation or conjecture will not defeat a summary judgment
motion." Dorsey v. Morgan Stanley, 507 F.3d
624, 627 (7th Cir. 2007) (citation and quotation marks
omitted). Additionally, "[a] party who bears the burden
of proof on a particular issue may not rest on its pleadings,
but must affirmatively demonstrate, by specific factual
allegations, that there is a genuine issue of material fact
that requires trial." Hemsworth, 476 F.3d at
490 (citation omitted). "The opposing party cannot meet
this burden with conclusory statements or speculation but
only with appropriate citations to relevant admissible
evidence." Sink v. Knox County Hosp., 900
F.Supp. 1065, 1072 (S.D. Ind. 1995) (citations omitted).
much the same way that a court is not required to scour the
record in search of evidence to defeat a motion for summary
judgment, nor is it permitted to conduct a paper trial on the
merits of [the] claim." Ritchie v. Glidden Co.,
242 F.3d 713, 723 (7th Cir. 2001) (citations and quotation
marks omitted). "[N]either the mere existence of some
alleged factual dispute between the parties nor the existence
of some metaphysical doubt as to the material facts is
sufficient to defeat a motion for summary judgment."
Chiaramonte v. Fashion Bed Grp., Inc., 129 F.3d 391,
395 (7th Cir. 1997) (citations and quotation marks omitted).
same standards apply even when each side files a motion for
summary judgment. The existence of cross-motions for summary
judgment does not imply that there are no genuine issues of
material fact. R.J. Corman Derailment Serv., LLC v.
Int'l Union of Operating Eng'rs., 335 F.3d 643,
647 (7th Cir. 2003). The process of taking the facts in the
light most favorable to the non-moving party, first for one
side and then for the other, may reveal that neither side has
enough to prevail without a trial. Id. at 648.
"With cross-motions, [the Court's] review of the
record requires that [the Court] construe all inferences in
favor of the party against whom the motion under
consideration is made." O 'Regan v. Arbitration
Forums, Inc., 246 F.3d 975, 983 (7th Cir. 2001)
(citation and quotation marks omitted).