One of the defendants in an antitrust lawsuit filed by the city of Charleston was dismissed in Kanawha County Circuit Court on Thursday morning.
In the first court hearing since Charleston filed an antitrust lawsuit against West Virginia Paving and at least seven other asphalt and paving companies in October, attorney Michael Farrell, representing defendant Kelly Paving, argued before Kanawha County Circuit Court Judge Tod Kaufman that his client should be dismissed from the city's lawsuit because it was never contracted to do asphalt projects in Charleston.
Farrell filed motions to dismiss the city's complaint naming Kelly Paving as a defendant, as well as in similar suits filed by Beckley, Bluefield, Huntington and the Kanawha County Commission.
"There has to be a causal connection between my client and the city of Charleston," Farrell said.
Farrell said because of the physical properties of asphalt, which is transported to project sites in liquid form, it would have been impossible for Kelly Paving to have done paving projects in Charleston and the other cities.
"It's beyond the range of the trucks we would hire to carry our materials, therefore we chose not to come," Farrell said, showing Kaufman a map of West Virginia that detailed the geographic area where Kelly Paving does business, which is mostly limited to the northern part of the state.
Kelly Paving has asphalt plants in St. Marys, Parkersburg, Benwood and Weirton, Farrell said.
Its parent company is Zanesville, Ohio-based Shelly & Sands, Inc.
The only complaint Kelly Paving answered without a motion to dismiss was that filed by the city of Parkersburg, which mirrors the allegations in the other complaints.
Farrell also denied allegations in the complaints that Kelly Paving conspired with the other defendants to illegally fix the price of asphalt in West Virginia by entering into a joint venture with West Virginia Paving to form Camden Materials, another defendant.
"For a conspiracy, you have to have an underlying cause of action," Farrell said.
Referring to the state's Antitrust Act, Farrell said, "where in this statute is there a proposition that if you do no business, that you can be held to respond and participate in a case like this, by merely alleging they were there?"
He argued that for the plaintiffs to argue Kelly Paving participated in monopolistic practices, they must demonstrate Kelly Paving was physically capable to do so, given the limitations in transporting liquid asphalt.
Mike Hissam of Bailey & Glasser LLP, which is representing all the involved municipalities, argued that it's not up to the court to determine the factual merits of the complaints during a hearing to dismiss.
Hissam said the Antitrust Act does apply to Kelly Paving, referring to a provision that states it is unlawful for a contract between two or more entities to have the effect of "fixing, controlling or maintaining the market price, rate or fee of the commodity or service."
"[Farrell's] argument is boiled down in essence to, unless you're a vendor to a municipality, you cannot be a defendant in an antitrust case," Hissam contended. "That language is found nowhere in the Antitrust statute."
While Kaufman approved Farrell's motion to dismiss Kelly Paving from the Charleston suit, he didn't make a decision on another motion made by Hissam to transfer and consolidate the six lawsuits, filed by Charleston, the Kanawha County Commission, Parkersburg, Beckley, Bluefield and Huntington, to Kanawha County Circuit Court.
Hissam said for the sake of efficiency, it's appropriate to consolidate the cases to the circuit court where the first complaint was filed, by the city of Charleston.
"If there's a discovery dispute, there's potential for six different discoveries, six motion to compel hearings, six different depositions of the same witnesses, over and over in different actions," Hissam said.
Attorney Booth Goodwin, representing defendants West Virginia Paving, Southern West Virginia Paving, Southern West Virginia Asphalt and Camden Materials, spoke in opposition to consolidating the cases at this point.
"We're simply saying that these complaints are not substantively identical, because the court has recognized ruling on a motion to dismiss today," Goodwin said. "There are different plaintiffs [and] different markets at issue. So necessarily, these don't arise from the same transaction or occurrence."
Attorney Charles Johnstone, representing American Asphalt and Aggregate and Blacktop Industries and Equipment Company, also opposed the motion to consolidate.
Similar hearings to consider Kelly Paving's motion to dismiss are scheduled in their respective circuit courts next week.
Thursday's hearing did not involve a similar antitrust lawsuit filed in January by Attorney General Patrick Morrisey's office on behalf of the Division of Highways. Morrisey's office issued a request for proposals for an outside firm to represent the Division of Highways. Bailey and Glasser submitted a bid for the case, but Morrisey's office hadn't awarded the case as of Thursday afternoon.
Reach Elaina Sauber at elaina.sauber@wvgazettemail.com, 304-348-3051 or follow @ElainaSauber on Twitter.