Pathfinder Aviation, INC. v. XTO Energy INC. et al
Filing
26
ORDER denying 22 Motion to Dismiss. Signed by Judge H. Russel Holland on 5/4/16. (PRR, COURT STAFF)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ALASKA
PATHFINDER AVIATION, INC.,
)
)
Plaintiff,
)
)
vs.
)
)
XTO ENERGY INC. and SCOTT GRIFFITH,
)
)
Defendants.
)
__________________________________________)
No. 3:15-cv-0200-HRH
ORDER
Motion to Dismiss
Defendants move to dismiss plaintiff’s negligent misrepresentation and UTPA
claims and to strike plaintiff’s prayer for punitive damages.1 This motion is opposed.2 Oral
argument was not requested and is not deemed necessary.
Background
Plaintiff is Pathfinder Aviation, Inc. Defendants are XTO Energy Inc. and Scott
Griffith.
1
Docket No. 22.
2
Docket No. 24.
-1-
Plaintiff “is a Homer-based provider of helicopter services and logistical support...,
providing services to the oil and gas, mining and construction industries.”3 Michael and
Mary Fell are plaintiff’s owners and Michael Fell (“Fell”) is the president of plaintiff.4
“XTO is a subsidiary of ExxonMobil.... Its Alaska Operations focused on oil
production in the Cook Inlet....”5 During the time at issue in this case, “Griffith served as
the production superintendent for the Alaska Operations division of XTO.”6
Plaintiff alleges that “[o]n June 4, 2014, XTO reached out to Pathfinder to explore the
possibility of hiring [Pathfinder] to support its Alaskan operations because it was not
happy with its current provider of transportation services.”7 Plaintiff alleges that in
January 2015, “Fell and Griffith met ... to discuss the acquisition of a specific helicopter
airframe that met XTO’s particular contract requirements: An Airbus EC135P2+....”8
Plaintiff further alleges that “[t]hereafter, XTO’s aviation management team met with
Pathfinder to perform a ‘gap analysis’ of Pathfinder’s assets and services, after which XTO
3
First Amended Complaint at 3, ¶ 8, Docket No. 21.
4
Id.
5
Id. at 2, ¶ 7.
6
Id.
7
Id. at 3, ¶ 10.
8
Id. at ¶ 11.
-2-
determined that Pathfinder qualified as an acceptable vendor.”9
Plaintiff alleges that “[o]n February 25, 2015, Griffith and Fell had a telephone
conversation wherein Griffith announced that Pathfinder had been awarded the contract
and would be XTO’s transportation services provider.”10 Plaintiff alleges that Griffith sent
Fell a follow-up email, in which Griffith stated that “XTO Energy has made the decision to
go with Pathfinder Aviation as our helicopter support contractor for our Alaska
Operations. I will begin working immediately to put the contract together under the terms
we have discussed.”11 Plaintiff alleges that as of February 25, 2015, the parties had agreed
upon the length of the contract (10 years), the effective date of the contract (September 1,
2015), and the price plaintiff would be paid for its services ($176,636 per month, plus $1,100
per flight hour).12 Plaintiff alleges that “[t]he February 25, 2015 email also included details
regarding a start-up fee of $50,000 and a termination clause.”13 “The February 25, 2015
email also confirmed that XTO Energy planned to enter into an additional agreement with
Pathfinder whereby if the primary helicopter – the Airbus EC – was taken off the XTO
contract in support of other aviation clientele or for repairs and maintenance, XTO would
9
Id.
10
Id. at 4, ¶ 13.
11
Id. at ¶ 14.
12
Id. at ¶ 15.
13
Id. at ¶ 16.
-3-
pay for the use of a twin-engine Bell 212 helicopter for backup, up to the first 12 months of
the contract.”14 And, plaintiff alleges that “[t]he February 25, 2015 email further indicated
that XTO was about to notify its then-current helicopter provider, ERA Helicopters, that
it would be terminating its contract and ‘going in another direction.’”15
Plaintiff alleges that “[a]fter the February 25, 2015 confirmation email and over the
course of the spring 2015, [it] worked to acquire the additional aircraft and to arrange for
[the] modifications to conform to XTO’s operation guidelines.”16 Plaintiff further alleges
that it “purchased ground support equipment, helicopter support equipment, and devoted
hundreds of labor hours into ensuring that [its] personnel and equipment complied with
XTO’s requirements and needs.”17 Plaintiff alleges that it expended over $400,000 on this
equipment and preliminary work.18
Plaintiff alleges that “[o]ver the course of spring 2015, Fell and Griffith worked
together on minor remaining details of the contract between XTO and Pathfinder.”19
Plaintiff further alleges that “Griffith continually communicated to Fell that there was an
14
Id. at 5, ¶ 18.
15
Id. at ¶ 19.
16
Id. at ¶ 20.
17
Id. at 6, ¶ 20.
18
Id.
19
Id. at ¶ 21.
-4-
enforceable and binding contract in place[.]”20 Plaintiff alleges that these communications
included a March 23, 2015 email, an April 30, 2015 email, and numerous verbal conversations.21 Plaintiff alleges that in the March 23, 2015 email, Griffith “made clear that there was
a binding contract in place with the use of quotations” and that in the April 30, 2015 email,
Griffith “reiterat[ed] the existence of a ‘ten year contract[.]’”22
Plaintiff alleges that despite Griffith’s representation in the February 25, 2015 email
that he would put the contract together immediately, “XTO delayed in signing the actual
written contract.”23 Plaintiff alleges that Griffith finally emailed the written contract to
Pathfinder on May 8, 2015 for Pathfinder’s signature.24 But, plaintiff alleges that Griffith
never signed the written contract.25
Plaintiff alleges that while it “was diligently working on building the infrastructure
needed to perform under the contract, XTO was in active negotiations with Hilcorp Energy,
20
Id.
21
Id.
22
Id.
23
Id. at ¶ 22.
24
Id. at 7, ¶ 22.
25
Id.
-5-
Inc. (‘Hilcorp’) regarding the sale of all of XTO’s assets in Alaska[.]”26 Plaintiff believes that
XTO began discussions with Hilcorp in late 2014.27 Plaintiff alleges that “XTO made a
concerted effort not to make these negotiations public, and actively hid these negotiations
from Pathfinder because it wanted Pathfinder to continue to build the infrastructure
needed to support the transportation services contract in the event the sale with Hilcorp
fell through....”28
Plaintiff alleges that “[b]ecause [it] was unaware that XTO was considering a sale to
Hilcorp, it continued to work on putting the necessary equipment in place to support the
contract, including the purchase of a Bell 212 helicopter for over $1.2 million.”29 Plaintiff
further alleges that it “also located an Airbus EC that met XTO’s standards and requirements with a purchase price of over $3.5 million.”30
Plaintiff alleges that
[j]ust prior to purchasing the Airbus EC, Fell received a call
from a Hilcorp representative ... who was close to the negotiations between Hilcorp and XTO.... While the Hilcorp representative did not inform Fell that Hilcorp was about to purchase
XTO, he did instruct Fell to be very careful when dealing with
26
Id. at 7, ¶ 24.
27
Id.
28
Id. at 8, ¶ 26.
29
Id. at ¶ 27.
30
Id.
-6-
XTO and committing resources to Pathfinder’s contract with
XTO. The Hilcorp Representative hinted that Fell needed to do
whatever was necessary to ensure that XTO understood that
there was an enforceable contract in place.[31]
Plaintiff alleges that
Fell contacted Griffith on or about June 20, 2015 to further
discuss the purchase of the Airbus EC and to again confirm the
agreement between the two parties. Fell asked Griffith if they
had an enforceable contract in place and Griffith assured Fell
that the contract between the two parties was enforceable and
binding....[32]
Plaintiff further alleges that “Fell asked Griffith a second time if the contract was binding,
and explained that XTO’s act of walking away from this contract ‘had the potential to put
him out of business.’ Griffith again stated that the contract was enforceable, by responding
as follows: ‘Mike, this contract is solid.’”33 Plaintiff alleges, however, that at this point in
time, Griffith knew “XTO would later claim that the contract was no good for a number of
reasons, including that there was no signed contract.”34
Plaintiff alleges that “[o]n July 1, 2015, a little over a week after [its] purchase of the
Airbus EC, and a little more than a week after Griffith assured Fell that the contract was
31
Id. at ¶ 28.
32
Id. at 10, ¶ 32.
33
Id. at ¶ 33.
34
Id. at 11, ¶ 35.
-7-
enforceable and ‘solid’, XTO announced that it had sold its Alaska operations to Hilcorp.”35
Plaintiff alleges that “Griffith called Fell and told him that XTO would not be going
forward with its contract with Pathfinder.”36 Plaintiff alleges that Griffith also sent an email
on July 2, 2015, in which he “admitted that there was a ‘contract’ with Pathfinder, but
[stated that] XTO would not be going forward with it ‘due to the sale of [XTO’s] Alaska
assets.’”37
Plaintiff alleges that “[a]fter this communication, Fell attempted to contact Griffith
and XTO regarding the contract, but to no avail.”38
Plaintiff alleges that
[s]ince XTO’s communication indicating that it would not
agree to the terms of the contract, and in order to avoid a
monthly payment in excess of $40,000 to support and maintain
the helicopters, Pathfinder sold the Bell 212 helicopter at a loss
of over $140,000 , and Pathfinder has been making every effort
to sell the Airbus EC, but has not yet been successful.[39]
Plaintiff alleges that “[i]t is anticipated that due to the unique nature of the Airbus EC,
which is a result of [XTO’s] unusual specifications, the aircraft will likely be sold for a loss
35
Id. at ¶ 36.
36
Id. at ¶ 37.
37
Id.
38
Id. at ¶ 38.
39
Id. at 11-12, ¶ 39.
-8-
of over $1 million.”40
On September 17, 2015, plaintiff commenced this action. In its original complaint,
plaintiff asserted six counts against defendants: 1) breach of contract, 2) breach of quasicontract and quantum meruit, 3) promissory estoppel, 4) breach of the covenant of good
faith and fair dealing, 5) misrepresentation, and 6) violation of Alaska Unfair Trade
Practices Act. Defendants moved to dismiss the contract claims against Griffith, the breach
of the covenant of good faith and fair dealing claim against XTO, and the misrepresentation
and UTPA claims against both defendants.41 Defendants also moved to strike plaintiff’s
prayer for punitive damages.42 The court granted defendants’ motion to dismiss but denied
the motion to strike.43 The court gave plaintiff leave to amend its breach of the implied
covenant of good faith and fair dealing claim against XTO and its misrepresentation and
UTPA claims against both defendants.44
Plaintiff timely filed an amended complaint. In its amended complaint, plaintiff
asserts five counts: 1) a breach of contract claim against XTO, 2) a breach of quasi-contract
and quantum meruit claim against XTO, 3) a promissory estoppel claim against XTO, 4) a
40
Id. at 12, ¶ 39.
41
Docket No. 10.
42
Docket No. 10.
43
Order re Motion to Dismiss; Motion for Leave to Amend at 19, Docket No. 20.
44
Id.
-9-
negligent misrepresentation claim against XTO and Griffith, and 5) a UTPA claim against
XTO and Griffith.
Pursuant to Rule 12(b)(6), Federal Rules of Civil Procedure, defendants now move
to dismiss plaintiff’s negligent misrepresentation and UTPA claims and to strike plaintiff’s
prayer for punitive damages.
Discussion
“Rule 12(b)(6) is read in conjunction with Rule 8(a), which requires not only ‘fair
notice of the nature of the claim, but also grounds on which the claim rests.” Zixiang Li v.
Kerry, 710 F.3d 995, 998 (9th Cir. 2013) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
556 n.3 (2007)). “To survive a Rule 12(b)(6) motion to dismiss, a ‘plaintiff must allege
enough facts to state a claim to relief that is plausible on its face.’” Turner v. City and
County of San Francisco, 788 F.3d 1206, 1210 (9th Cir. 2015) (quoting Lazy Y Ranch Ltd. v.
Behrens, 546 F.3d 580, 588 (9th Cir. 2008)). “In assessing whether a party has stated a claim
upon which relief can be granted, a court must take all allegations of material fact as true
and construe them in the light most favorable to the nonmoving party; but ‘conclusory
allegations of law and unwarranted inferences are insufficient to avoid a Rule 12(b)(6)
dismissal.’” Id. (quoting Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009)). “‘A claim
has facial plausibility when the plaintiff pleads factual content that allows the court to draw
the reasonable inference that the defendant is liable for the misconduct alleged.’” Id.
-10-
(quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “This standard ‘asks for more than a
sheer possibility that a defendant has acted unlawfully,’ but it ‘is not akin to a probability
requirement.’” Id. (quoting Iqbal, 556 U.S. at 678). “In sum, for a complaint to survive a
motion to dismiss, the non-conclusory ‘factual content,’ and reasonable inferences from that
content, must be plausibly suggestive of a claim entitling the plaintiff to relief.” Moss v.
U.S. Secret Service, 572 F.3d 962, 969 (9th Cir. 2009) (quoting Iqbal, 556 U.S. at 678).
Defendants first move to dismiss plaintiff’s negligent misrepresentation claim. The
elements of a negligent misrepresentation claim are
(1) the party accused of the misrepresentation must have made
the statement in the course of his business, profession or
employment, or in any other transaction in which he has a
pecuniary interest, (2) the representation must supply false
information, (3) there must be justifiable reliance on the false
information supplied, and (4) the accused party must have
failed to exercise reasonable care or competence in obtaining or
communicating the information.
Reeves v. Alyeska Pipeline Service Co., 56 P.3d 660, 670-71 (Alaska 2002) (citations
omitted).
[A] cause of action for negligent misrepresentation is complete
when the injured party has suffered a pecuniary loss as a result
of the misrepresentation. To that extent, future occurrences
can be related back to the time when the misrepresentation
which resulted in the loss was made. However, to establish
liability under this theory it is not enough to demonstrate that
subsequent occurrences made an originally-accurate representation ultimately false. For a representation to be actionable, ...
the representation must be false when made.
-11-
Bubbel v. Wien Air Alaska, Inc., 682 P.2d 374, 381 (Alaska 1984). While negligent
misrepresentation does not require “proof that the maker knew of the untrue character of
his or her representation[,]” it does require proof that the statement was false when made.
Id.
Plaintiff alleges that Griffith made numerous representations that the parties had a
binding and enforceable contract but that “[a]ll of these representations contained false
information when they were made because XTO claims that there was never an enforceable
contract in place....”45 Plaintiff also alleges that these communications “were made without
reasonable care or competence because each time Griffith communicated to Pathfinder that
there was an enforceable contract in place, these representations were false due to XTO’s
belief that no contract ever existed.”46 By way of example, plaintiff alleges that when
Griffith told Fell that the contract was “solid” in June 2015, “Griffith most certainly knew
that XTO would not need Pathfinder’s services”, given that the sale to Hilcorp was
announced a little over one week later.47
Defendants argue that plaintiff has not alleged any factual support for its allegations
that Griffith’s representations were false at the time they were made.
45
First Amended Complaint at 15, ¶ 56, Docket No. 21.
46
Id. at ¶ 57.
47
Id. at ¶ 58.
-12-
Defendants
acknowledge that plaintiff has alleged that Griffith told Fell that there was an enforceable
contract on February 25, 2015; March 23, 2015; April 23, 2015; and on other unspecified
dates between February and July 2015. But defendants argue that an after-the-fact change
in circumstances, namely Hilcorp’s acquisition of XTO’s Alaska assets, does not make these
statements false when made.
Defendants argue that nothing about the timing of events in this case suggests that
Griffith’s statements were false when made. Defendants contend that any inference based
on the timing of events would be unreasonable, as the court has already decided. In
opposition to the first motion to dismiss, plaintiff argued that the timing of events, XTO’s
unwillingness to sign the written contract, and XTO’s refusal to communicate with plaintiff
after XTO was acquired by Hilcorp gave rise to inferences that XTO knew all along that it
was going to breach the contract and that XTO was seeking to maliciously cause plaintiff
injury.48 The court found that these inferences were not reasonable in part because plaintiff
had not alleged that XTO knew for months that it was going to be sold to Hilcorp.49
Plaintiff has attempted to fix this problem in its amended complaint. Plaintiff has
alleged that “on information and belief”, XTO’s negotiations with Hilcorp started in late
48
Order re Motion to Dismiss; Motion for Leave to Amend at 12, Docket No. 20.
49
Id.
-13-
2014 and continued into 2015.50 Defendants argue that allegations based on “information
and belief” are not sufficient. “But, [p]ost Twombly and Iqbal, the Ninth Circuit has not
considered the sufficiency of ... allegations made on ‘information and belief.’” Clifton v.
Houghton Mifflin Harcourt Publishing Co., — F. Supp. 3d —, 2015 WL 9319402, at *3 (N.D.
Cal. 2015). “The Second Circuit has, holding (in a copyright case) that the Twombly and
Iqbal plausibility standard allows factual allegations made ‘upon information and belief’
where (1) ‘the facts are peculiarly within the possession and control of the defendant,’ or
(2) ‘where the belief is based on factual information that makes the inference of culpability
plausible.’” Id. (quoting Arista Records, LLC v. Doe 3, 604 F.3d 110, 120 (2d Cir. 2010)).
Here, the facts as to when Hilcorp and XTO began their negotiations would not be in
plaintiff’s possession and control, but rather XTO’s. Thus, plaintiff has adequately alleged
that XTO knew for several months that it is was going to be acquired by Hilcorp. More
importantly, as to the timing of events, plaintiff alleges that on June 20, 2015, Griffith told
Fell that the parties’ contract was “solid”, which was only a little over a week before
Hilcorp’s acquisition of XTO was announced. It is reasonable to infer from this timing that
Griffith’s representation on June 20, 2015 was false when made.
Defendants also argue that the fact that Griffith did not “immediately” sign a written
contract does not give rise to an inference that Griffith’s representations were false when
50
First Amended Complaint at 7, ¶ 24, Docket No. 21.
-14-
made. Rather, defendants argue that the only inference that can be drawn from this “fact”
is that the parties were still in contract negotiations.
But the facts alleged in plaintiff’s amended complaint do not suggest that the parties
were still in contract negotiations, but rather that defendants were stalling in signing the
written contract. Plaintiff has alleged that many of the terms of the contract had been
agreed upon by February 25, 2015 and that during the spring of 2015, there were only
“minor remaining details” of the contract to be worked out.51 And plaintiff has alleged that
XTO did not send a written contract to plaintiff until May 8, 2015 and “then only after
being continually requested to do so by Pathfinder.”52 “If there are two alternative
explanations, one advanced by defendant and the other advanced by plaintiff, both of
which are plausible, plaintiff’s complaint survives a motion to dismiss under Rule 12(b)(6).
Plaintiff’s complaint may be dismissed only when defendant’s plausible alternative
explanation is so convincing that plaintiff's explanation is implausible.” Starr v. Baca, 652
F.3d 1202, 1216 (9th Cir. 2011). Defendants’ argument that the parties were still in contract
negotiations until July 2015 is not so convincing that it makes plaintiff’s contention to the
contrary implausible. Plaintiff has alleged sufficient factual support for its contention that
XTO was delaying signing the contract. That allegation, along with plaintiff’s allegation
51
Id. at 6, ¶ 21.
52
Id. at 7, ¶ 22.
-15-
that XTO was in negotiations with Hilcorp by late 2014, is sufficient to suggest that
Griffith’s representations that the parties’ contract was binding and enforceable were false
when made.
Defendants also argue that plaintiff’s allegations about Fell’s conversation with the
Hilcorp Representative do not suggest that Griffith’s statements were false when made.53
Defendants argue that it would not be reasonable to infer from these allegations that XTO
and Griffith knew that they never intended to enter into a contract with plaintiff.
Defendants point out that plaintiff expressly alleged that “the Hilcorp Representative did
not inform Fell that Hilcorp was about to purchase XTO[.]”54 Defendants argue that the
Hilcorp Representative’s alleged suggestion that plaintiff get contractual assurances simply
does not demonstrate that Griffith’s representations about an enforceable contract were
false when made. Defendants insist that all plaintiff has alleged is that a Hilcorp
Representative called Fell and told Fell to be careful and get contractual assurances from
XTO, but defendants argue that these “facts” do not in anyway suggest that Griffith’s
representations about the parties’ contract were false when made.
53
Contrary to defendants’ contention, the allegations about the phone call from the
Hilcorp Representative to Fell are not the only new factual allegations in plaintiff’s first
amended complaint. Plaintiff’s first amended complaint contains other factual allegations
that were not in plaintiff’s original complaint or in plaintiff’s proposed first amended
complaint.
54
First Amended Complaint at 8, ¶ 28, Docket No. 21.
-16-
The alleged call from the Hilcorp Representative does suggest that Griffith’s
statements about there being a binding and enforceable contract were false. Even though
the Hilcorp Representative did not mention the possible acquisition, the Hilcorp
Representative appeared to be warning Fell that plaintiff’s contract with XTO might not be
as “solid” as Griffith was assuring Fell it was.
Plaintiff has adequately alleged that Griffith’s representations that plaintiff and XTO
had a binding and enforceable contract were false when made. Thus, plaintiff has stated
a plausible negligent misrepresentation claim.
Defendants next move to dismiss plaintiff’s UTPA claim. “Two elements must be
proved to establish a prima facie case of unfair or deceptive acts or practices under the
Alaska Act: (1) that the defendant is engaged in trade or commerce; and (2) that in the
conduct of trade or commerce, an unfair act or practice has occurred.” State v. O'Neill
Investigations, Inc., 609 P.2d 520, 534 (Alaska 1980). “An act or practice is deceptive or
unfair if it has the capacity or tendency to deceive.” Id. “An act or practice need not be
‘deceptive’ to be ‘unfair.’” Id. at 535. Factors the court may consider when determining
whether an act or practice is unfair include
“(1) whether the practice, without necessarily having been
previously considered unlawful, offends public policy as it has
been established by statutes, the common law, or otherwise
whether, in other words, it is within at least the penumbra of
some common-law, statutory, or other established concept of
unfairness; (2) whether it is immoral, unethical, oppressive, or
-17-
unscrupulous; [and] (3) whether it causes substantial injury to
consumers (or competitors or other businessmen).”
Id. (quoting F. T. C. v. Sperry & Hutchinson Co., 405 U.S. 233, 244-45 n.5 (1972)). Alaska
law requires a plaintiff to demonstrate that the defendant did something more egregious
than breach a contract or assert the non-existence of a contract. Kenai Chrysler Center, Inc.
v. Denison, 167 P.3d 1240, 1256 (Alaska 2007); see also, Alaska Rent-A-Car, Inc. v. Cendant
Corp., Case No. 3:03–cv–00029–TMB, 2007 WL 2206784, at *22 (D. Alaska July 27, 2007)
(“The fact that an act is a breach of a contractual obligation does not, ipso facto, render it
an unfair trade practice”).
Plaintiff alleges that defendants
engaged in unfair and deceptive practices, including but not
limited to, the following: Misrepresenting their intent to
contract with Pathfinder for its services; representing that
Pathfinder’s services had approval and status [they] did not
have; engaging in conduct creating a likelihood of confusion or
misunderstanding which misled, deceived and damaged
Pathfinder in connection with the sale of good and services,
specifically transportation services; and knowingly making
false or misleading statements regarding the existence of a
contract.[55]
Plaintiff’s UTPA claim in its amended complaint is identical to the UTPA claim in
its original complaint except for the allegation that defendants knowingly made false or
misleading statements regarding the existence of a contract. Defendants argue that this
55
First Amended Complaint at 17, ¶ 66, Docket No. 21.
-18-
new allegation is not sufficient to save plaintiff’s UTPA claim because plaintiff has not pled
any factual support for its allegation that Griffith’s representations about the existence of
a contract were false when made. Defendants insist that statements made about the
parties’ contract prior to Hilcorp’s acquisition of XTO were true and only became false after
the Hilcorp acquisition.
But, as discussed above, plaintiff has adequately alleged that at least some of
Griffith’s statements were false when made. False or misleading statements can be
considered an unfair or deceptive act. See, e.g., Golber v. BayBank Valley Trust Co., 704
N.E.2d 1191, 1194 (Mass. Ct. App. 1999) (holding that negligent misrepresentation may be
an unfair and deceptive act). Thus, plaintiff has stated a plausible UTPA claim.
Finally, defendants move to strike plaintiff’s prayer for punitive damages.
Defendants argue that even if plaintiff has alleged viable tort claims, which the court finds
that plaintiff has, plaintiff’s prayer for punitive damages should still be stricken because
plaintiff has not alleged that defendants’ conduct was 1) outrageous or done with malice
or bad motives or 2) evidenced reckless indifference to the interests of another person. AS
09.17.020. Defendants point out that “[i]f the evidence does not give rise to an inference of
actual malice or conduct sufficiently outrageous to be deemed equivalent to actual malice,
then the trial court need not submit the issue of punitive damages to the jury.” Hayes v.
Xerox Corp., 718 P.2d 929, 935 (Alaska 1986). Defendants insist that plaintiff has not
-19-
alleged that they acted outrageously or with malice or bad motives. Rather, defendants
contend that all plaintiff has alleged is a breach of contract.
Plaintiff has alleged more than a breach of contract here. A reasonable jury could
conclude that defendants acted outrageously or with malice if, as plaintiff has alleged, XTO
was negotiating with Hilcorp at the same time it was encouraging plaintiff to develop the
infrastructure and buy the helicopters necessary for the contract.
Conclusion
Defendants’ motion to dismiss plaintiff’s negligent misrepresentation and UTPA
claims is denied as is their motion to strike plaintiff’s prayer for punitive damages.
DATED at Anchorage, Alaska, this 4th day of May, 2016.
/s/ H. Russel Holland
United States District Judge
-20-
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?