NEW ORLEANS — A federal judge in New Orleans recently reversed part of an order issued last summer, finding there exists after all "a material issue of fact" in a $2 million rebate ownership dispute between a Colorado restaurant company and a shareholder.
In his 22-page order issued Oct. 17, U.S. District Court Judge Martin L. C. Feldman, on the bench in Louisiana's Eastern District, said he "now finds that there is a genuine factual dispute as to the ownership of rebates" in Restaurant Supply v. Pride Centric Resources.
Feldman handed down his order in response to Restaurant Supply's motion that the judge reconsider his Aug. 22 order in which he granted part of a defense motion for summary judgment and dismissed the plaintiff's equitable accounting claim.
The litigation is over whether shareholders are entitled to rebates from a restaurant equipment cooperative, according to the background portion of Feldman's order. Restaurant Supply had been a shareholder in Pride Centric Resources since 2006.
Restaurant Supply claims to be due $2 million in rebates accrued from purchases in 2015 and 2016, according to the background portion of Feldman's order. Pride Centric Resources, based in Centennial, Colorado, said it couldn't pay rebates those two years because of significant losses sustained when Pride Centric had to guarantee a large debt.
Restaurant Supply asked Feldman to reconsider his order based on an amendment to a relevant shareholder agreement that vests rebate ownership in Pride Centric Resources, formerly known as Pride Marketing & Procurement, Inc.
"The plaintiff contends that the Court made erroneous and unsupported factual findings because it (1) overlooked evidence the plaintiff had submitted in opposition to the defendant's motion, and (2) made credibility and factual determinations on disputed issues of fact," the order said.
Feldman said in his more recent order that he now finds representations in Pride's financial statements "do create disputed issues of fact."
"As such, the court alters its finding on the issue of rebate ownership, now concluding that there is a material issue of fact as to the intent of the parties in adopting the first amendment," Feldman continued.