An eight-year-long, three-way legal fight involving 84 Lumber in Louisiana that prompted a 2013 ProSales article has ended with all charges dismissed, in part on procedural grounds.
Legal skirmishes over issues like attorney's fees continue, but the main event concluded Jan. 22 when a federal judge granted the dismissal of a slew of complaints and claims involving 84; bonding agent Maggie's Management; several insurance companies; Chicago-based construction business F.H. Paschen, S.N. Nielsen & Associates (Paschen); and J&A Construction Management Resources, run by Addie Mills (pictured above).
Paschen had hired J&A in 2010 to build an elementary school and a high school near New Orleans. Mills' J&A in turn hired 84 Lumber to serve as its subcontractor. Mills told ProSales in 2013 she first got interested in working with 84 when she learned the dealer offered special programs to assist small minority contracting firms like hers with bonding, project supervision, and materials for large construction projects.
J&A claimed in various court documents that 84 violated its agreement with J&A by failing to provide skilled workers, necessary materials, and proper supervision as well as pay advances on funds from Paschen. A Louisiana newspaper reported last month that Mills claimed 84 Lumber failed to secure adequate bond coverage for the construction projects, leaving her company bankrupt when F.H. Paschen cut funding over delays. She was forced to lay off more than a dozen employees when she closed her firm, the newspaper said.
By April 2011, Paschen and J&A stopped paying 84. In July 2012, 84 sued Paschen and its surety companies, alleging it wasn't paid for work performed under its Master Services Agreement with J&A. Paschen replied by adding J&A as a third-party defendant. J&A came back with a cross-claim against Paschen and counterclaims against 84 for breach of contract and other wrongdoings. J&A also named Maggie's Management--it's named for 84 President Maggie Hardy Magerko--as a third-party defendant.
84 and Maggie's Management fought and won a July 2013 court order requiring that J&A abide by its Master Services Agreement with 84 and take the dispute to arbitration. J&A replied that it would proceed with arbitration "at the time it sees fit," but didn't move. A federal judge ordered J&A to start arbitration by May 30, 2014, then extended the deadline to July 24, 2014. On July 23 of that year, J&A submitted an arbitration demand to the American Arbitration Association (AAA) but didn't pay the standard filing fee. In October 2014, AAA closed that file.
Eleven months later, in September 2015, Judge Helen Berrigan of the U.S. District Court for Louisiana's Eastern District ordered J&A to show cause why it shouldn't be held in contempt of court for failing to submit to arbitration. J&A responded by saying an arbitration agreement would be overly favorable to 84 and because arbitration is prohibitively expensive.
Finally, in May 2016, District Judge Sarah Vance (who had taken over the case) said three years of inaction was enough. She dismissed J&A's claims against 84 and Maggie's Management for failure to prosecute. The dismissal was made "with prejudice," meaning J&A can't refile charges.
84's case with J&A slowed the progress of the two other legal fights going on, between Paschen and 84 and between Paschen and J&A. Those finally were all dismissed on Jan. 22 of this year. Over J&A's objections, Paschen's case against J&A was dismissed without prejudice.
Mills, who also is president of Minority Contractors Association Of Louisiana, told ProSales in an interview April 4 that her No. 1 goal was to have her day in court. When one magistrate asked her why she didn't take a deal offered by Paschen, she said she replied: "It's not about the money. It's about my name and my company. ... They basically didn't want me to testify."
"Those eight years drained me," she added later. "I'm glad it's behind me, but the bottom line is, they still got away with too much."
