United States District Court, W.D. Washington
ELBRIDGE H. STUART, III, Plaintiff,
CAMP KOREY, Defendant.
ORDER DENYING MOTIONS FOR SUMMARY JUDGMENT AND
DENYING PLAINTIFF'S MOTION TO STRIKE
RICARDO S. MARTINEZ CHIEF UNITED STATES DISTRICT JUDGE.
matter comes before the Court on Defendant Camp Korey's
Motion for Summary Judgment (Dkt. #10), Plaintiff Elbridge H.
Stuart, III's Motion to Strike (Dkt. #13), and Mr.
Stuart's Cross Motion for Summary Judgment (Dkt. #18).
For the reasons below, the Court DENIES all three Motions.
Elbridge H. Stuart III is a director of the Elbridge and
Debra Stuart Family Foundation and the manager of SCF
Holdings, LLC (“SCF”), previously known as
Carnation Farms, LLC, which is a subsidiary of the
Foundation. Dkt. #17 at 1. Mr. Stuart is the great-grandson
of Elbridge Stuart, who founded the Carnation Milk Company in
1899. Id. at 2. In 1985, Carnation was acquired by
the Nestle Corporation. Id. This sale included the
original Carnations Farm Site in Carnation, Washington.
Id. In 2008, Nestle sold Carnation Farms to
Defendant Camp Korey, a nonprofit organization that provides
camping facilities for children with serious illnesses.
Id. Mr. Stuart served on the board of directors for
Camp Korey starting in 2007. Id. at 2.
December 21, 2009, SCF purchased Carnation Farms from Camp
Korey and leased the property back to Camp Korey.
Id. at 4. At this time, Mr. Stuart was still on the
board of directors for Camp Korey.
April of 2016, Mr. Stuart resigned from the board and sent a
notice of default to Camp Korey alleging, among other things,
that Camp Korey had not performed certain maintenance and
improvement projects ostensibly required by the lease. Dkts.
#12 at 2; #12-1. This notice was sent “[o]n behalf of
Carnation Farms LLC” and signed by Mr. Stuart. Dkt.
#12-1. Eventually, counsel for Camp Korey and counsel
representing SCF negotiated an Agreement to Mediate to
Resolve Differences (“Agreement”) on May 27,
2016. Dkt. #12-5. The Agreement refers to disputes between
“the parties” but does not define that term or
list the parties to the Agreement. Id. The Agreement
states “[a]ny disputes between the parties that are not
resolved by September 30, 2016 shall be resolved by binding
arbitration, by an arbitrator agreed to by counsel for the
parties.” Id. The Agreement has only two
signature lines, and is signed by Chris McReynolds for Camp
Korey and Mr. Stuart for Carnation Farms LLC. Id.
ultimately occurred with Mr. Stuart in attendance. The
engagement letter for the mediation listed the parties as
“Camp Korey/Carnation Farms, LLC/Elbridge
Stuart.” Dkt. #12-8. Mr. Stuart's counsel submitted
a mediation brief “on behalf of the Elbridge and Debra
Stuart Family Foundation, its subsidiary, Carnation Farms
LLC, and Elbridge (‘Bridge') Stuart.” Dkt.
#12-9 at 1. This letter states “[t]he parties will
arbitrate any remaining claims if they cannot be resolved at
mediation, ” and appears to list Mr. Stuart as a party
under a section titled “The Parties.”
Id. at 3. Later, the letter reiterates “[t]he
parties have agreed to arbitrate all claims if they cannot be
resolved at mediation.” Id. at 9.
parties mediated but were unsuccessful and the dispute was
scheduled for binding arbitration. On October 4, 2016, the
arbitrator, Judge Kallas (ret.), issued a Report of
Preliminary Hearing and Case Scheduling Order listing
“Elbridge H. Stuart/Carnation Farms, LLC” as the
Plaintiffs. Dkt. #11-5. Although the arbitration included
claims between Carnation Farms LLC and Camp Korey, Camp Korey
also brought cross-claims against Mr. Stuart personally.
action, Mr. Stuart asserts that he was not subject to the
Agreement, cannot be bound to arbitration, and seeks
declaratory judgment. Dkt. #1. The parties have agreed to
stay the arbitration until this action is resolved.
Korey now moves for summary judgment, arguing that extrinsic
evidence establishes Mr. Stuart as a party to the Agreement,
that he should be bound to the Agreement by equitable
estoppel, and that he should be bound through agency theory.
Dkt. #10. Mr. Stuart also moves for summary judgment based on
the face of the Agreement and certain extrinsic evidence.
Plaintiff's Motion to Strike
Stuart brought this action for the Court to determine whether
his participation in a mediation binds him personally to the
Agreement and its term requiring mandatory arbitration. In
its Answer, Camp Korey alleges certain counterclaims. Dkt.
#7. In doing so, Camp Korey relies on language from a
mediation brief submitted “on behalf of the Elbridge
and Debra Stuart Family Foundation, its subsidiary, Carnation
Farms LLC (collectively referred to as the ‘Stuart
Foundation'), and Elbridge (‘Bridge')
Stuart.” Id. at ¶ 5.11. Camp Korey
asserts that Mr. Stuart's counsel “made clear that
any resolution in the mediation necessarily would have to
include the claims Camp Korey was asserting against Mr.
Stuart individually.” Id. at ¶ 5.12. Mr.
Stuart now moves to strike these paragraphs under the
mediation privilege and the terms of the mediation. Dkt. #13.
The Court has reviewed Mr. Stuart's Motion to Strike
Paragraphs 5.11 and 5.12 from Camp Korey's Answer
pursuant to Rule 12(f) and determined that Mr. Stuart cannot
rely on the mediation privilege or the terms of the mediation
to strike these paragraphs because he has necessarily opened
the door to such communications by bringing this action.
See Bradfield v. Mid-Continent Cas. Co., 15
F.Supp.3d 1253, 1256-57 (M.D. Fla. 2014) (discussing
mediation privilege); Chevron Corp. v. Pennzoil Co.,
974 F.2d 1156, 1162 (9th Cir. 1992). The Court is also
convinced that Mr. Stuart has waived the mediation privilege
with regard to ...