FEC Heliports, LLC v. Hornbeck Offshore Operators, LLC

Filing 49

ORDER AND REASONS denying 41 Motion for Reconsideration. Signed by Judge Martin L.C. Feldman on 11/2/16. (clc)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
FEC HELIPORTS, LLC

CIVIL ACTION

V.

NO. 15-4827

HORNBECK OFFSHORE OPERATORS, LLC

SECTION "F"

ORDER AND REASONS
Before the Court is plaintiff’s motion to reconsider the
Court’s order granting defendant’s motion for summary judgment as
to

breach

of

the

Pricing

Agreement

and

PO

2155141.

For

the

following reasons, the motion is DENIED.
Background
Plaintiff,

FEC

Heliports,

originally

filed

suit

against

Hornbeck to recover unpaid invoices for work FEC completed on the
M/V HOS Bayou heliport and for unpaid shipping costs related to
work on the M/V HOS Riverbend. Hornbeck responded and filed a
counterclaim against FEC alleging that: (1) The purchase order for
the Riverbend helideck stipulated that FEC could not recover
charges for shipping; (2) FEC breached the Master Service Agreement
and Purchase Order 2155141 (PO) for the Bayou heliport because it
failed to provide an American Bureau of Shipping (ABS) and CAP 437
compliant helideck as required by the PO; and (3) FEC breached the
Pricing Agreement when it failed to honor Hornbeck’s purchase
orders for two additional helidecks.

1

Hornbeck moved for partial summary judgment on FEC’s breach
of the PO, MSA, and Pricing Agreement. The Court granted the
motions for partial summary judgment and denied FEC’s cross motion
for partial summary judgment. The Court hereby incorporates the
statement of facts from the Order and Reasons, dated October 3,
2016, where the Court granted Hornbeck’s partial motions for
summary judgement and denied FEC’s cross motion.
FEC now moves the Court to reconsider its Order and Reasons
of October 3, 2016 as to the PO and Pricing Agreement. 1
I.
Motions requesting reconsideration of court orders generally
fall under Rule 54(b), Rule 59(e), or Rule 60(b) of the Federal
Rules of Civil Procedure. See Higgins v. Cain, No. 07–9729, 2012
WL 3309716, at *1 (E.D. La. Aug. 13, 2012); Waste Mgmt. of La.,
Inc. v. River Birch, Inc., No. 11–2405, 2012 WL 876717, at *1 (E.D.
La. Mar. 14, 2012); Castrillo v. Am. Home Mortg. Servicing, Inc.,
No. 09–4369, 2010 WL 1424398, at *3–4 (E.D. La. Apr. 5, 2010).
Rule 59(e) provides that a motion to alter or amend a judgment
must be filed no later than twenty-eight days after the entry of
judgment. Fed.R.Civ.P. 59(e). Rule 60(b), on the other hand,
applies to motions filed after the twenty-eight day period, but

1

Notably, FEC does not move the Court to reconsider its Order and
Reasons pertaining to granting summary judgment on breach of the
MSA.
2

demands more “exacting substantive requirements.” See Lavespere v.
Niagara Mach. & Tool Works, Inc., 910 F.2d 167, 173–74 (5th Cir.
1990), abrogated on other grounds, Little v. Liquid Air Corp., 37
F.3d 1069, 1078 (5th Cir. 1994) (en banc).
Rules 59 and 60, however, apply only to final judgments. When
a party seeks to revise an order that adjudicates fewer than all
the claims among all of the parties, then Rule 54(b) controls.
Under Rule 54(b), the district court possesses the inherent power
to reconsider, rescind, or modify an interlocutory order for cause
seen by it to be sufficient. See Fed.R.Civ.P. 54(b). Because the
Court's October 3, 2016 Order and Reasons adjudicated fewer than
all of the claims among the parties to this suit, Rule 54(b)
governs. Notably, Rule 54(b) motions are construed under the same
standards that govern Rule 59(e) motions to alter or amend a final
judgment. See Waste Mgmt. of La., 2012 WL 876717, at *1; Castrillo,
2010 WL 1424398, at *3.
II.
“A Rule 59(e) motion ‘calls into question the correctness of
a judgment.’” Templet v. Hydrochem, Inc., 367 F.3d 473, 478 (5th
Cir. 2004) (quoting In re Transtexas Gas Corp., 303 F.3d 571, 581
(5th Cir. 2002)). Because of the interest in finality, Rule 59(e)
motions may only be granted if the moving party shows there was a
mistake of law or fact or presents newly discovered evidence that
could not have been discovered previously. Id. at 478–79. Moreover,
3

Rule 59 motions should not be used to relitigate old matters, raise
new arguments, or submit evidence that could have been presented
earlier in the proceedings. See id. at 479; Rosenblatt v. United
Way of Greater Houston, 607 F.3d 413, 419 (5th Cir. 2010)(“[A]
motion to alter or amend the judgment under Rule 59(e) ‘must
clearly establish either a manifest error of law or fact or must
present newly discovered evidence’ and ‘cannot be used to raise
arguments which could, and should, have been made before the
judgment issued.’”)(citing Rosenzweig v. Azurix Corp., 332 F.3d
854, 864 (5th Cir. 2003)(quoting Simon v. United States, 891 F.2d
1154, 1159 (5th Cir. 1990)). The grant of such a motion is an
“extraordinary remedy that should be used sparingly.” Indep. Coca–
Cola Employees' Union of Lake Charles, No. 1060 v. Coca–Cola
Bottling Co. United, Inc., 114 F. App'x 137, 143 (5th Cir. Nov.
11, 2004) (citing Templet, 367 F.3d at 479). The Court must balance
two important judicial imperatives in deciding whether to reopen
a case in response to a motion for reconsideration: “(1) the need
to bring the litigation to an end; and (2) the need to render just
decisions on the basis of all the facts.” Templet, 367 F.3d at
479. 2
III.

2

In its motion for reconsideration, FEC failed to provide the
Court with the legal standard for a court to reconsider an Order
and Reasons.
4

FEC contends that reconsideration is appropriate for two
reasons: (1) FEC cannot be found to be in breach of the PO because
Hornbeck now has an ABS and CAP 437 compliant helideck on the HOS
Bayou; (2) The Court misinterpreted a crucial provision in the PO
which led to the Court misinterpreting the effect of changing the
material used on the validity of the Pricing Agreement. The Court
disagrees.
A. Purchase Order 2155141
In its motion for reconsideration as to the breach of the PO,
FEC first contends that that the Court erred in determining that
FEC’s quote for the HOS Bayou helideck was not incorporated in the
PO itself. 3 It argues that the Court misinterpreted terms of the
PO, namely, whether the quote is incorporated by reference into
the PO and whether parties contemplated changes to the PO. However,
FEC ignores that, though those two issues may affect other portions
of the Court’s Order and Reasons, these issues do not address why
the Court granted summary judgment as to FEC’s breach of the PO.

3

FEC alleges, again, that the quote for the HOS Bayou helideck
was incorporated into the PO. In its Order and Reasons, the Court
found that the PO was a fully-integrated contract. The Court
upholds this finding, reasoning that the quote was referenced as
a point of identification. Clause 10 of the PO, “Entire Contract,”
explicitly confirms the Court’s order that the PO constitutes the
entire contract. Additionally, the PO references incorporation of
the MSA terms, but it does not reference incorporation of the quote
terms. Therefore, FEC rehashing this incorporation by reference
argument fails.
5

Hornbeck originally moved for partial summary judgment as to
FEC’s breach of the PO because FEC failed to provide an ABS and
CAP 437 compliant helideck, as explicitly required under the terms
of the PO. FEC’s argument does not address or alter the premise
upon which summary judgment was granted, namely that FEC admitted
to not initially providing a helideck design that was both ABS and
CAP 437 compliant; this failure coupled with Hornbeck having to
hire and pay a third party to assist in a contractually compliant
design is where the breach lies. Therefore, FEC’s submission cannot
be said to “call[] into question the correctness of the judgment.”
In re Transtexas Gas Corp., 303 F.3d at 581. 4
FEC also contends that summary judgment as to the breach of
the

PO

must

be

reconsidered

because

the

parties

changed

the

material used on the vertical supports from aluminum, as listed in
the PO, to steel. FEC’s argument is far less than clear, but it
appears that FEC is making a timeliness argument. FEC seemingly
urges that the change from the agreed-upon aluminum to steel caused
a delay in the process, which FEC appears to believe is the basis
for the Court finding a breach of the PO. However, this again is
misguided. To underscore, the Court held that summary judgment as
to

the

PO

breach

was

appropriate

4

because

FEC

did

not,

when

The Court hereby reiterates and incorporates all findings related
to the PO breach from its October 3, 2016 Order and Reasons into
this Order and Reasons.
6

contractually obliged to do so, independently provide a suitable
ABS and CAP 437 helideck; rather, the final design incorporated
the work of a third party. 5 Therefore, because FEC’s arguments
fail, the Court denies reconsideration of its grant of summary
judgment as to the breach of the PO. 6
B. Pricing Agreement
FEC discredits the Court’s interpretation and application of
certain terms in the PO, which are incorporated into the Pricing
Agreement. FEC is correct in stating that the Court quoted portions
of the PO, which FEC urges infers that the Court misinterpreted

5

At the time ABS revoked its original certificate of compliance,
and FEC had yet to secure CAP 437 compliance, Hornbeck sought
design input from A.K. Suda, Inc. FEC agreed to incorporate Suda’s
work into its final design product. FEC did not pay for Suda’s
design services.
6 FEC alleges that either the PO was terminated when Hornbeck sent
FEC a demand letter in November 2014 and Hornbeck is entitled to
post-termination damages, or the PO was not terminated and Hornbeck
is not entitled to consequential damages. FEC alerts the Court
that Hornbeck cannot have it “both ways.” However, in the original
motion for summary judgment for the breach of the PO, Hornbeck
specifically reserves the determination of damages for trial.
Therefore, the Court need determine whether damages are
appropriate or not. On this note, in the original partial motions
for summary judgment the parties never sought a determination of
whether the PO was breached in November 2014. Because a
reconsideration is not a chance for parties to allege new arguments
to the Court, the Court is also not compelled to speculate whether
Hornbeck terminated the contract in November 2014. See Templet,
367 F.3d at 478-79. At this time, the Court merely considers
whether FEC breached the PO by failing to comply with a critically
unconditional and important term of the PO: the requirement to
provide an ABS and CAP 437 compliant helideck.
7

certain qualifying phrases. The quoted section FEC refers to reads
in full:
. . . Design also includes the structural steel
members supporting the aluminum structure that will
attach to the vessel in locations yet to be determined.
This design also includes emergency exit stairs,
walkways and platforms designed in either steel or
aluminum based on final weight requirements.
Fully aware of the full statement of the quote, the Court
paraphrased in a footnote, stating:
Design also includes the structural steel members
supporting the aluminum structure . . . will attach . .
. at locations yet to be determined. Additionally,
[Design Services] says that platforms [are to be]
designed in either steel or aluminum.
The Court highlighted that the parties contemplated further design
changes and decisions. Instead, FEC alleges that the Court used
the pieced-together phrasing to hold that all of the structures
and design elements were still undecided by the parties. (It was
not until FEC moved for reconsideration that it included a diagram,
which labelled and distinguished the different structures on the
helideck and the original materials the parties contemplated would
be used for each part).
This diagram, however, still supports the Court’s holding in
its Order and Reasons that the parties contemplated design changes
after entering into the PO. FEC now clarifies that the steel
structural members could be fewer in number than the aluminum
vertical supports, as more than one vertical support could possibly

8

connect to one steel structural member. The Court’s interpretation
assumed that the number of vertical supports was also still to be
considered under the “Design Services” provision in the PO. Rather,
FEC notes now that only the locations of the steel structural
members was yet to be determined.
FEC contends that the aluminum vertical supports, as provided
for in the PO, were changed to steel, and that caused the PO to be
“altered, modified, or changed.” Additionally, FEC asserts that
the number of supports was also decided when it entered into the
PO and Pricing Agreement, but that number also changed during the
design process. Because of these changes to the PO, FEC moves the
Court to reconsider its effect on the Pricing Agreement breach.
Hornbeck responds that FEC’s argument for reconsidering the
breach of the Pricing Agreement is unsound because there was a
mutual agreement to change the Pricing Agreement. On this record,
the Court agrees.
FEC’s submissions do not persuade the Court to reconsider
summary judgment. It fails to acknowledge that the change from
aluminum to steel was not mutually agreed upon by the parties.
What FEC neglects to realize is that FEC fulfilled a contract based
on changed terms. Although the parties failed to enter into written
modifications

of

modification

was

the

PO,

mutually

the

Court

agreed

nevertheless

upon

because

notes

that

“either

oral

agreement or conduct can . . . prove modification” as well. Taita
9

Chem. Co. v. Westlake Styrene Corp., 246 F.3d 377, 387 (5th Cir.
2001).

Here, the parties do not dispute whether the PO, which

originally provided for aluminum, was changed and performed using
steel. Further, the helideck provided for under the PO was in fact
completed using steel. Therefore, there is no foundation for the
Court to determine the parties did not mutually agree to this
change order. 7
Next, FEC correctly notes that the Pricing Agreement was based
on PO 2155141, as originally signed by the parties. It follows,
FEC alleges, that any subsequent changes to the PO invalidates the
Pricing

Agreement.

While

FEC

gratuitously

says

that

this

proposition is “hornbook contract law,” it patently fails to point
to any authority for such a sweeping comment.
In its October 3, 2016 Order and Reasons, the Court held that
the parties had not fully contemplated a finalized version the HOS
Bayou helideck design. Without having finalized the design at the
time of entering the Pricing Agreement, the Court held that on the
record before it, changes were contemplated, FEC assumed the risk
of price fluctuations, and, as Hornbeck suggests, FEC should be
held to the pricing terms in the Pricing Agreement as originally
agreed upon. A breach of the Pricing Agreement occurred when FEC

7

When the change from aluminum to steel became necessary to the
parties, FEC even offered a discounted price to Hornbeck upon
agreeing to the change.
10

failed

to

honor

the

prices

stipulated

in

the

agreement

when

Hornbeck submitted two additional helideck orders. Quite simply,
confusing rhetoric aside, FEC failed to honor the terms of its
contract. 8
IV.
Accordingly, IT IS ORDERED that the plaintiff’s motion for
reconsideration is hereby DENIED.

New Orleans, Louisiana, November 2, 2016

______________________________
MARTIN L. C. FELDMAN
UNITED STATES DISTRICT JUDGE

8

FEC untimely and improperly disputes the affidavit Hornbeck
submits to support its claim for damages related to the Pricing
Agreement breach. As already addressed in this Order and Reasons,
it is not appropriate to raise new issues through a motion for
reconsideration. The Court hereby adopts its findings from the
October 3, 2016 Order and Reasons as to the breach of the Pricing
Agreement and the related damages.
11