Brothers Petroleum, LLC v. Wagners Chef, LLC et al

Filing 46

ORDER AND REASONS - IT IS HEREBY ORDERED that LNV's Motion to Dismiss (Rec. Doc. 20) pursuant to 12(b)(1) is GRANTED and LNV is dismissed as a party to these proceedings. IT IS FURTHER ORDERED that the Motions to Dismiss submitted by Defendants Wagner World, LLC (Rec. Doc. 21); and Empire Express, LLC (Rec. Doc. 22) are GRANTED and that Wagner World and Empire Express are dismissed as parties to these proceedings. IT IS FURTHER ORDERED that the Motion to Dismiss submitted by Defendants, Jad allah Enterprises, LLC and Ahmed 1, LLC, jointly, (Rec. Doc. 18) is GRANTED IN PART to dismiss with prejudice the revocatory actions asserted against Defendants; DENIED IN PART as to Brothers' claims against Jadallah Enterprises and Ahmed 1 for unfair trade practices; and GRANTED IN PART to dismiss with prejudice Brothers' claims against Jadallah Enterprises and Ahmed 1 for unjust enrichment. Signed by Judge Carl Barbier on 7/31/2018. (cg)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
BROTHERS PETROLEUM,
LLC

CIVIL ACTION

VERSUS

No.: 17-6713

WAGNERS CHEF, LLC,
ET AL.

SECTION: “J”(1)

ORDER & REASONS
NATURE OF MOTION AND RELIEF REQUESTED
Before the Court are Motions to Dismiss submitted by Defendants, Jadallah
Enterprises, LLC and Ahmed 1, LLC, jointly, (Rec. Doc. 18); LNV Corporation (Rec.
Doc. 20); Wagner World, LLC (Rec. Doc. 21); and Empire Express, LLC (Rec. Doc.
22). Brothers responded to Defendants with a single omnibus memorandum in
opposition (Rec. Doc. 24), to which all Defendants except Empire Express have
replied. This Court heard oral argument regarding the Motions on July 11, 2018.
Having considered the motions and legal memoranda, the record, and the applicable
law, the Court finds that LNV Corporation’s, Wagner World’s, and Empire Express’s
Motions should be GRANTED and the Motion by Jadallah Enterprises and Ahmed
1 should be GRANTED IN PART and DENIED IN PART.
FACTS AND PROCEDURAL BACKGROUND
The central dispute of this case is between a petroleum distributor, Brothers
Petroleum, LLC, (“Brothers”) and a petroleum retailer, Wagners Chef, LLC. In

October of 2012, Brothers entered into a supply contract (the “Contract”) for Exxon
branded fuel with the retail operator of a gas station and convenience store at the
intersection of Chef Menteur Highway and Louisa Street in New Orleans, Louisiana
(the “Property”). Less than a year later, Wagners Chef acquired the right to operate
the gas station and storefront as well as the right to purchase fuel under the Contract
from Brothers. 1 According to Brothers, the Contract does not terminate until at least
September of 2026, with an automatic 5-year renewal. 2
Mr. Jadallah Saed—who is not a party to this suit—subsequently acquired a
100% interest in Wagners Chef. 3 Following the change in ownership, Wagners Chef
initiated state court litigation against Brothers in July of 2014, alleging that Wagners
Chef was not bound by the Contract. 4 However, the Louisiana Fourth Circuit Court
of Appeal found the Contract valid, 5 and a state district court ordered specific
performance of the Contract in May of 2016. 6 Brothers avers that despite these
rulings, Wagners Chef continued to refuse to comply with the Contract. 7 Brothers
attempted to force compliance by filing a motion for contempt proceedings against
Wagners Chef, and sole owner, Mr. Saed. 8 It also sought a writ of distringas to have
the Sheriff for the Parish of Orleans appointed to take control of the Property. 9

The Contract was originally between Brothers Petroleum and B-Xpress Louisa, LLC. However,
“through a subsequent ratification of the Contract in June 2013,” Wagners Chef became party to the
Contract “as successor-in-interest to B-Xpress at the Store.” (Rec. Doc. 3-3 at 3.).
2 (Rec. Doc. 24 at 4).
3 (Rec. Doc. 24 at 2).
4 (Rec. Doc. 24 at 3).
5 (Rec. Doc. 24 at 3).
6 (Rec. Doc. 38-4).
7 (Rec. Doc. 43-2 at 6).
8 (Rec. Doc. 24 at 3).
9 (Rec. Doc. 43-2 at 6).
1

2

Brothers claims that Wagners Chef did not begin purchasing fuel from Brothers in
compliance with the Contract and the order of specific performance, until September
of 2016, and only complied at all due to the threat of further legal action. 10
While Wagners Chef operated the gas station and store, it did not own the
Property; it leased the Property (the “Chef Lease”) from the then-owner, Wagner
World, LLC. The Chef Lease allegedly “extended through February, 2022 with a
seven (7) year option to purchase thereafter.” 11 However, on July 8, 2016, Wagners
Chef cancelled the Chef Lease. 12 Brothers alleges that the Chef Lease was Wagners
Chef’s “single most valuable asset” because it operated its business from the Property,
its operational licenses and permits relied on the lease, and the lease contained an
option to purchase.
On the same day as the lease cancellation, Jadallah Enterprises, LLC
purchased the Property from Wagner World and then leased it to Ahmed 1, LLC.
Jadallah Saed is the sole owner of both these entities, as well as Wagners Chef. First
NBC Bank provided a multiple indebtedness mortgage to fund Jadallah Enterprise’s
purchase of the Property and Ahmed 1 executed an assignment of rents in favor of
First NBC as security (the “First NBC Loans”). Brothers claims that a month before
cancelling the lease, Wagners Chef received approval for $2.9 million dollar loan from
First NBC for purchase of the Property. 13 Subsequently, Ahmed 1 subleased the

(Rec. Doc. 24 at 5).
(Rec. Doc. 24 at 4).
12 (Rec. Doc. 5 at 3).
13 (Rec. Doc. 24 at 6).
10
11

3

Property to Empire Express and on November 8, 2016, Wagners Chef sold all of its
assets to Empire Express, LLC.
Brothers alleges that during the period after these transactions, but before the
distringas hearing set for November 2, 2016, it was “necessary to deceive the [state]
trial court into believing ‘all was well’ and that they were and that they were willing
to finally . . . honor the contract.” 14 Brothers further asserts that contemporaneously
with this deception on the state trial court, Mr. Saed sent a verified application for a
liquor license for the property on behalf of a single-member LLC which is not a party
to this lawsuit, and then another application on behalf of Wagners Chef. In each of
these applications, Mr. Saed allegedly indicated that the property was operated under
a lease from Jadallah Enterprises, knowing this to be false, because Jadallah
Enterprises had leased the entirety of the property to Ahmed 1, which had executed
the assignment of rents in favor of First NBC. 15
On December 21, 2016, Brothers filed a revocatory action in state court seeking
to annul the cancellation of the Chef Lease, the sale of the Property to Jadallah
Enterprises, the lease to Ahmed 1, and the sale of Wagners Chef’s assets to Empire
Express. Brothers alleges that the cancellation of the lease and the transfers of the
Property caused or increased the insolvency of Wagners Chef to the detriment of
Brothers. 16 Further, Brothers claims that it is entitled to a judgment annulling both
the multiple indebtedness mortgage and the assignment of rents because First NBC

(Rec. Doc. 43-2 at 6).
(Rec. Doc. 43-2 at 7).
16 See (Rec. Doc. 1).
14
15

4

knew or should have known that these transactions would cause Wagners Chef to
breach its Contract with Brothers and increase the insolvency of Wagners Chef. 17
Brothers also seeks damages for unfair trade practices, or alternatively, unjust
enrichment from each of the Defendants (with the exception of NBC First’s successorin-interest). 18
First NBC was declared insolvent and the FDIC became First NBC’s receiver
in April of 2017. Per the extensive powers granted it under the Federal Institutions,
Recovery, and Enforcement Act (“FIRREA”), the FDIC removed this case from state
court on May 30, 2017. On July 17, 2017, the FDIC moved to stay these proceedings
until it could complete its administrative review of any claims set forth by First
NBC. 19 This Court granted a stay of proceedings extending for 180-days from the
filing of Brothers’ administrative claim, or until the FDIC denied Brothers claims for
administrative relief, whichever occurred first. 20 In October of 2017, the FDIC as
receiver conveyed the First NBC Loans to LNV Corporation. The Court then removed
the FDIC-receiver as a defendant and added LNV. 21 This Court terminated the stay
on January 19, 2018. 22 Soon after, Defendants filed their respective Motions to
Dismiss.

LEGAL STANDARD
(Rec. Doc. 3-3 at 9).
(Rec. Doc. 17) (naming Wagners Chef, Jadallah Enterprises, Ahmed 1, Empire Express, Wagner
World, and First NBC as Defendants in its Amending Petition).
19 (Rec. Doc. 3-1 at 1).
20 (Rec. Doc. 9).
21 (Rec. Doc. 11).
22 (Rec. Doc. 13).
17
18

5

Under the Federal Rules of Civil Procedure, a complaint must contain “a short
and plain statement of the claim showing that the pleader is entitled to relief.” Fed.
R. Civ. P. 8(a)(2). The complaint must “give the defendant fair notice of what the
claim is and the grounds upon which it rests.” Dura Pharm., Inc. v. Broudo, 544 U.S.
336, 346 (2005) (internal citations omitted). The allegations “must be simple, concise,
and direct.” Fed. R. Civ. P. 8(d)(1).
To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must plead enough
facts to “state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim
is facially plausible when the plaintiff pleads facts that allow the Court to “draw the
reasonable inference that the defendant is liable for the misconduct alleged.” Id. A
court must accept all well-pleaded facts as true and must draw all reasonable
inferences in favor of the plaintiff. Lormand v. U.S. Unwired, Inc., 565 F.3d 228, 232
(5th Cir. 2009); Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996). The Court is not,
however, bound to accept as true legal conclusions couched as factual allegations.
Iqbal, 556 U.S. at 678. “[C]onclusory allegations or legal conclusions masquerading
as factual conclusions will not suffice to prevent a motion to dismiss.” Taylor v. Books
A Million, Inc., 296 F.3d 376, 378 (5th Cir. 2002).
When examining matters of state law, this Court will employ the principles of
interpretation used by the state’s highest court. Am. Int'l Specialty Lines Ins. Co. v.
Rentech Steel LLC, 620 F.3d 558, 564 (5th Cir. 2010). Mindful of Louisiana’s
distinction between primary and secondary sources of law, the Court will begin its

6

analyses with reliance on the Louisiana Constitution and statutes before looking to
“jurisprudence, doctrine, conventional usages, and equity, [which] may guide the
court in reaching a decision in the absence of legislation and custom.” Shaw
Constructors v. ICF Kaiser Eng'rs, Inc., 395 F.3d 533, 547 (5th Cir. 2004) (quoting La.
Civ. Code. art. 1 rev. cmt. b). If the Court must make an “Erie guess” on an issue of
Louisiana law, the Court will decide the issue the way that it believes the Supreme
Court of Louisiana would decide it. Id. (citation omitted). This Court is not strictly
bound by the decisions of the state intermediate courts and will disregard them if the
Court is “convinced that the Louisiana Supreme Court would decide otherwise.” In re
Katrina Canal Breaches Litig., 495 F.3d 191, 206 (5th Cir. 2007).
DISCUSSION
I.

FIRREA AND PLAINTIFF’S REVOCATORY ACTIONS

LNV asserts that this Court is jurisdictionally barred by FIRREA from
granting Brothers the equitable relief it seeks—rescission or annulment of the
Defendants’ various transactions and acts concerning the Property. If the Court finds
for LNV on this ground, this Court would also be restrained from granting revocatory
relief against the other Defendants. 23 Thus, the Court begins with examining the
scope of FIRREA’s anti-injunction provision. 12 U.S.C. § 1821(j), places the following
limitation on court action: “Except as provided in this section, no court may take any

At oral argument the Court asked each Party whether any individual transaction could be unwound
without affecting the First NBC Loans. Each of the Defendants argued that rescinding any of the
transactions would cause a domino effect—with consequences eventually cascading down to the First
NBC Loans. Brothers’ counsel suggested that LNV’s foreclosure option will protect the First NBC
Loans from being “affected,” but could not point to any transaction which it seeks to rescind that is
isolated from this “domino effect.”

23

7

action, except at the request of the Board of Directors by regulation or order, to
restrain or affect the exercise of powers or function of the [FDIC] as a conservator or
a receiver.”
The language is clear: this Court cannot “restrain” (or even merely “affect”) any
exercise of receivership powers by the FDIC. Obviously, “rescission is a ‘judicial
restraint’ that is barred by 1821(j).” Ward v. ADR Tr. Corp., 996 F.2d 99, 104 (5th
Cir. 1993). Moreover, “[t]here is no question . . . that the disposition of a failed federal
savings institution's assets is one of the quintessential statutory powers of the
RTC/FDIC as receiver.” Save Our Wetlands, Inc. v. State of La., Landmark Lands Co.,
CIV. A. 95-4221, 1996 WL 194924, at *2 (E.D. La. Apr. 19, 1996). Finally, antiinjunction protection extends even in cases where the receiver has conveyed the asset
to a third party. Dittmer Properties, L.P. v. F.D.I.C., 708 F.3d 1011, 1017 (8th Cir.
2013). Therefore, Brothers concedes (as it must) that FIRREA bars annulment of the
First NBC loans. 24
Nevertheless, Brothers claims there is no “provision of FIRREA which frees
LNV from the claims and defenses which were previously available against First NBC
Bank or from its position as a defendant in the revocatory action presented in this
litigation.” 25 Brothers apparently believes that this Court is not restrained from
reinstating the Chef Lease, regardless of “detrimental effect upon the title to the
property acquired by LNV’s mortgagor, Jadallah Enterprises,” 26 because the act to be

(Rec. Doc. 24 at 20-21).
(Rec. Doc. 24 at 21).
26 (Rec. Doc. 24 at 21).
24
25

8

rescinded preceded First NBC’s involvement and insolvency, and any detrimental
effect would be merely incidental. Brothers cites no authority for this proposition
which defies the plain language of the statute.
Ultimately, what Brothers seeks is to have the Wagners Chef’s right to operate
the Property reinstated so that Wagners Chef may fulfill its obligation to purchase
fuel from Brothers. However, this cannot be achieved without also rescinding all the
other downstream transactions between the various Defendants. Because the First
NBC Loans would necessarily be detrimentally effected by an order rescinding or
annulling any action by the Parties which transferred rights in the Property,
Defendants other than just LNV also benefit from 1812(j)’s shield—even those who
acted before First NBC even entered the picture. See Dittmer Properties, L.P. v.
F.D.I.C., 708 F.3d 1011, 1017 (8th Cir. 2013) (citation omitted) (“An action can ‘affect’
the exercise of powers by an agency without being aimed directly at the agency.”).
In this case, even if the Court merely reinstated the Chef Lease, that court
action would necessarily “restrain or affect the FDIC’s powers to deal with the [First
NBC Loans] it is charged with disbursing.” Id. That is so, because to accomplish this
result, the Court would have to restore ownership of the Property to Wagner World,
which would require dissolving Jadallah Enterprise’s lease to Ahmed 1 and Ahmed
1’s lease to Empire Express. The end result of all these revocations and annulments:
LNV would be forced to foreclose on the First NBC Loans. Clearly, forcing LNV to
foreclose on the assets it has been assigned by the FDIC would severely affect the
exercise of the receiver’s powers. See FDIC v. Urb. Partn. Bank, 17-CV-1517, 2018

9

WL 2021223, at *5 (N.D. Ill. May 1, 2018). This Court cannot grant relief that would
entangle it in “the equitable thicket that FIRREA was intended to clear away.” Id.
“Although this limitation on courts' power to grant equitable relief may appear
drastic, it fully accords with the intent of Congress at the time it enacted FIRREA in
the midst of the savings and loan insolvency crisis.” Freeman v. F.D.I.C., 56 F.3d
1394, 1398 (D.C. Cir. 1995). Thus, this Court finds that it does not have jurisdiction
to grant relief in a revocatory action against LNV or against any of the Defendants.
Brothers also asserts that its action should not be dismissed because it has
elected to “continue on the claim in the federal district court where the failed bank’s
principal place of business is located” pursuant to § 1821(d)(6)(A). 27 This argument
too, is unavailing. Subsection (d) of § 1821 provides an exhaustion requirement that
funnels claims first through an administrative claims process. Freeman v. F.D.I.C.,
56 F.3d 1394, 1400 (D.C. Cir. 1995). Once a claim has been disallowed, or a certain
amount of time has passed, a rejected claimant may seek administrative review with
the FDIC, or take their claim directly to district court for review. Id. Contrary to
Brothers’ statements in its opposition memorandum, Brothers has not asked this
Court for review of its administrative claim. Brothers’ sole cause of action against
LNV in the instant matter is for revocatory relief. As noted above, this Court lacks
jurisdiction to grant that equitable remedy. Dismissal of all claims against LNV is
appropriate. 28

(Rec. Doc. 24 at 22).
The Court notes that with the dismissal of the FDIC’s successor-in-interest and only two state claims
remaining, remand to the state district court would be appropriate as a matter of discretion. However,
this case arose under the Court’s original jurisdiction and the Fifth Circuit has made clear that
27
28

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II.

UNFAIR TRADE PRACTICES
a. The Applicable law

The Court now reaches the two state law claims that Brothers asserts against
all parties other than LNV. The first of these causes of action is brought under the
Louisiana Unfair Trade Practices Act (“LUTPA”). LUTPA allows recovery from a
defendant who commits “unfair or deceptive acts or practices in the conduct of any
trade or commerce.” Cheramie Services, Inc. v. Shell Deepwater Prod., Inc., 35 So. 3d
1053, 1059 (La. 4/23/10), (quoting La. R.S. §51:1405(A)). Courts decide on a case-bycase basis what conduct violates this prohibition, but it is settled law that the
behavior must (1) violate public policy and (2) be “immoral, unethical, oppressive,
unscrupulous, or substantially injurious.” Id. Moreover, despite the apparent
discretion a court enjoys in deciding what conduct is prohibited under LUTPA, the
Louisiana Supreme Court has admonished that “the range of prohibited practices
under LUTPA is extremely narrow.” Id. at 1060.
A defendant’s motivation for engaging in allegedly unfair practices is a “critical
factor” in a court’s analysis. Harris v. Poche, 930 So. 2d 165, 171 (La. App. 4 Cir.
4/12/06), writ denied, 938 So. 2d 74 (La. 2006). Outright fraud is the prototypical
example of an unfair trade practice. See, e.g., Walker v. Hixson Autoplex of Monroe,
L.L.C., 2017 WL 5760363 (La. App. 2 Cir. 11/29/17) reh'g denied (Jan. 4, 2018), Dufau
v. Creole Engineering, Inc., 465 So. 2d 752, 758 (La. App. 5 Cir. 1985), writ denied,
regardless of how strongly principles of judicial economy recommend remand of lingering state law
claims, this Court may not do so. Adair v. Lease Partners, Inc., 587 F.3d 238, 245 (5th Cir. 2009).

11

468 So. 2d 1207 (La. 1985) (finding a plaintiff must prove “some element of fraud,
misrepresentation, deception, or other unethical conduct”). The United States Fifth
Circuit has found that only competitors or consumers can bring a claim under
LUTPA, Orthopedic & Sports Injury Clinic v. Wang Labs., Inc., 922 F.2d 220, 226
(5th Cir. 1991), but the Defendants argue merely that Brothers has not stated a
proper claim under LUTPA—they have not contested that Brothers has standing to
bring a claim under the act. 29
Defendants instead assert that there are no real claims of fraud or
unscrupulous behavior, only allegations that the Defendant companies engaged in
what are proper and legal transactions—namely, the sale of the Property by Wagner
World to Jadallah Enterprises, and the leases by Jadallah Enterprises to Ahmed 1,
and by Ahmed 1 to Empire Express. However, Brothers claims that Defendants
undertook these acts and transactions “with the specific purpose and intent of
depriving plaintiff, Brothers, of its rights against defendant, Wagners Chef, LLC . . .
and preventing Brothers . . . from recovering damages.” 30 In other words, Brothers
alleges the various Saed-owned LLCs acted in collusion with one another to leave
Brothers’ sole obligor insolvent and unable to comply with a court judgment ordering
the specific performance of a contract. Before determining whether the claimed

Since the Fifth Circuit’s decision in Wang Labs, the Louisiana Supreme Court has found that parties
other than competitors and customers may bring suit under LUTPA. Cheramie Services, Inc. v. Shell
Deepwater Prod., Inc., 35 So. 3d 1053, 1057 (La. 4/23/10) (“Although business consumers and
competitors are included in the group afforded this private right of action, they are not its exclusive
members.”). Some lower courts have been persuaded to follow this diverging state precedent, see Max
Access, Inc. v. Gee Cee Co. of LA, Inc., No. 15-1728, 2016 WL 454389, at *4 (E.D. La. Feb. 5, 2016), but
this Court need not address the issue now because it has not been raised.
30 (Rec. Doc. 17 at 18).
29

12

conduct has been stated with sufficient particularity to meet Iqbal’s plausibility
standard, the Court should determine whether this conduct could ever amount to an
unfair trade practice.
Although, the Court is unaware of any case in which the Louisiana Supreme
Court has held that assisting a party in defying an order of specific performance
amounts to an unfair trade practice, the Louisiana Supreme Court held long ago that
where an obligor and judgment debtor transfers her assets to a newly formed
corporation in order to escape enforcement of a judgment, that conduct amounts to
fraud on the part of all involved, Price v. Florsheim, 142 So. 135, 137 (La. 1932), and
fraud is clearly an unfair trade practice. See Dufau, 465 So. 2d at 758. Furthermore,
Louisiana appellate courts have found behavior similar but less egregious than what
is alleged here, to amount to an unfair trade practice. For example, in Bank of New
Orleans & Tr. Co. v. Phillips, 415 So. 2d 973, 975 (La. Ct. App. 1982), the Louisiana
Fourth Circuit, upheld a trial court’s determination that it was an unfair trade
practice for a bank to intentionally file suit against a credit card customer in an
improper venue. The court found this act to be “tantamount to an abuse of process,”
an act of “harassment to the defendant” and an attempt “hinder him in his access to
the courts.” Id.
Bank of New Orleans highlights an important feature of unfair trade practices
suits. While merely filing in the wrong venue is not usually considered tortious, doing
so with the intent to harass the defendant made the conduct actionable. Id. In
Louisiana, conduct that is otherwise not illegal, may constitute an unfair trade

13

practice if is undertaken with the unscrupulous purpose of harming competition,
rather than helping oneself. Monroe Med. Clinic, Inc. v. Hosp. Corp. of Am., 622 So.
2d 760, 766 (La. Ct. App.1993), writ denied, 629 So .2d 1135 (La. 1993). Accordingly,
the Court finds that assisting a person or entity in defying an order of specific
performance on a contract may constitute an unfair trade practice, if the act is done
with the specific purpose of depriving the party entitled to performance of its rights.
A motivation to “hinder [a person] in his access to the courts” and the courts’ remedies
is key for such a claim. See Bank of New Orleans, 415 So. 2d at 975.
b. Plausibility of Brothers’ Claim
The Court must still determine whether the facts alleged here give rise to a
plausible claim that the Defendants acted with the specific purpose of depriving
Brothers of its right to specific performance. Brothers leans heavily on the fact that
Wagners Chef, Jadallah Enterprises and Ahmed 1, all share Mr. Saed as their sole
member. However, Jadallah Enterprises and Ahmed 1 counter that “[t]he common
ownership of the limited liability companies involved in this matter is irrelevant to
the determination of whether Brothers has a claim against these individual legal
entities. Jadallah Enterprises and Ahmed 1 are separate legal entities, distinct from
Wagners Chef, and must be treated as such.” 31
This point has some merit because Brothers has not put forth an alter ego,
single enterprise, continuing enterprise or veil piercing theory in this case, and
therefore the acts of one defendant entity may not be attributed to the other.

31

(Rec. Doc. 33 at 2).

14

Nevertheless, the Court does not find the shared ownership and control of Wagners
Chef, Jadallah Enterprises, and Ahmed 1 by the same Jadallah Saed, totally
irrelevant. What purpose the alleged conduct was undertaken with controls whether
it constitutes an unfair trade practice. See Bank of New Orleans, 415 So. 2d at 975.
The motivations of the Defendant entities are therefore relevant to determining
whether their conduct amounts to unfair trade practices. The Court cannot determine
the motivations of Wagners Chef, Jadallah Enterprises, and Ahmed 1, without
acknowledging that each is composed and controlled by a single member: Mr. Saed.
This fact of common ownership and control, along with Wagners Chef’s
previous attempts to get out of the Contract, the allegedly gratuitous cancellation of
the Chef Lease by Wagners Chef, the alleged deceptions on the state trial court and
the City of New Orleans, and the sale of the property to another LLC owned by Mr.
Saed, rather than Wagners Chef (which had already received approval to purchase
the Property) combine to plausibly suggest a concerted effort to frustrate Brothers’
right to specific performance on the Contract from Wagners Chef. The Court can infer
that the above conduct was plausibly undertaken by Wagners Chef, Jadallah
Enterprises, and Ahmed 1, with the intent to leave Brothers with an insolvent debtorobligor, from whom Brothers cannot hope to collect or expect performance. 32 The

The Court does not suggest that these Defendants are one entity, but finds merely that Brothers
has pleaded a plausible claim that Jadallah Enterprises and Ahmed 1 helped Wagners Chef to
circumvent an order of specific performance with an unscrupulous purpose. The critical distinction
between what the Court finds today, and a single enterprise theory, is that entities in the instant
matter can only be held liable for their own acts, whereas under a single enterprise theory, each entity
is responsible for all of the acts of the others entities also considered to be a part of the collective
enterprise. See Green v. Champion Ins. Co., 577 So. 2d 249, 258 (La. App. 1 Cir. 1991), writ denied,
580 So. 2d 668 (La. 1991).
32

15

Court finds that this alleged behavior is against public policy and unscrupulous and
unethical. Therefore, the Court will not dismiss the unfair trade practices claims that
are alleged against the single member entities owned by Mr. Saed, at this time.
However, the claims of unfair trade practices asserted against Wagner World
and Empire Express are not sufficiently supported to reach even the plausibility
standard. For these companies, which are not owned by Mr. Saed, Brothers has not
alleged, and the Court cannot infer, a plausible illicit motivation for these entities’
roles in the attacked transactions. Therefore, these actions are dismissed without
prejudice.
III.

UNJUST ENRICHMENT

Brothers’ other state law claim is for unjust enrichment. To succeed, Brothers
must prove: “1) an enrichment, (2) an impoverishment, (3) a connection between the
enrichment and resulting impoverishment, (4) an absence of ‘justification’ or ‘cause’
for the enrichment and impoverishment, and (5) no other remedy at law available to
plaintiff.” Huntsman Int'l LLC v. Praxair, Inc., 201 So.3d 899, 911 (La. App. 4 Cir.
9/14/16).
Defendants argue that per the fifth element, unjust enrichment may only serve
for “gap filling.” 33 Therefore, it is only properly considered when it is the only avenue
for relief. Mouton v. State, No. 2010-0353 (La. 6/4/10), 38 So.3d 243, 244. That it is
“the only avenue” does not mean that an unjust enrichment is an alternative to other
claims which a plaintiff has unsuccessfully put forth. JP Mack Indus. LLC v. Mosaic

33

(Rec. Doc. 18-1 at 9).

16

Fertilizer, LLC, 970 F.Supp. 2d 516, 521 (E.D. La. 2013), Walters v. MedSouth Record
Mgmt., LLC, So.3d 241, 242 (La. 6/4/10) (per curiam) (“The mere fact that a plaintiff
does not successfully pursue another available remedy does not give the plaintiff the
right to recover under the theory of unjust enrichment.”). Rather, unjust enrichment
is allowed where the law has not “provided plaintiff with another remedy.” Walters,
38 So.3d at 242.
Unfortunately for Brothers, it has persuaded the Court that the law has
provided it a remedy—the revocatory action—against two parties: Wagner World,
LLC and Empire Express. Under Louisiana law, an obligee such as Plaintiff has a
right to annul an act of his obligor if the act was made or effected after the right of
the obligee arose and that act causes or increases the obligor's insolvency. La. C.C.
art. 2036; see also Parish National Bank v. Wilks, 923 So. 2d 8, 15 (La. App. 1 Cir.
8/3/05). Thus, in order to succeed in a revocatory action, an obligee must prove: (1)
there was an act (or failure to act) of the obligor that caused or increased the obligor's
insolvency; and (2) the act occurred after the obligee's rights arose. Wilks, 923 So. 2d
at 15. Each of the Defendants complain they are not Brothers’ “obligor” and so a
necessary element is not met. But for a fraudulent conveyance (which a revocatory
action seeks to undo), it takes two to tango: the obligor and the third party to whom
the obligor has transferred the property. See Opelousas Prod. Credit Ass'n v. B.B. &
H., Inc., 525 So. 2d 91, 93 (La. App. 3 Cir. 1988). Admittedly, Brothers confuses things
by asking this Court to annul some transactions that are too far removed from any
action by its obligor, but both Wagner World and Empire Express transacted directly

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with Brothers’ obligor, Wagners Chef. In order to undo the acts that rendered its
obligor insolvent, Brothers would need to join the third parties who transacted with
Wagners Chef. See Id., La. C.C. art. 2042 (requiring obligee to join as defendants third
parties who were involved in the obligor’s act or failure to act). Therefore, the law has
provided Brothers a remedy against these parties, albeit one that Brothers cannot
act on because of the anti-injunction provision of FIRREA. Brothers’ only remaining
claims against Wagner World and Empire Express for unjust enrichment must be
dismissed. See JP Mack Indus., 970 F.Supp. 2d at 522. Likewise, since the Court has
found Brothers has a valid remedy in the form of an unfair trade practices claim
against Jadallah Enterprises and Ahmed 1, the unjust enrichment claims alleged
against those Defendants must be dismissed as well.
CONCLUSION
Accordingly,
IT IS HEREBY ORDERED that LNV’s Motion to Dismiss (Rec. Doc. 20)
pursuant to 12(b)(1) is GRANTED and LNV is dismissed as a party to these
proceedings.
IT IS FURTHER ORDERED that the Motions to Dismiss submitted by
Defendants Wagner World, LLC (Rec. Doc. 21); and Empire Express, LLC (Rec.
Doc. 22) are GRANTED and that Wagner World and Empire Express are dismissed
as parties to these proceedings.
IT IS FURTHER ORDERED that the Motion to Dismiss submitted by
Defendants, Jadallah Enterprises, LLC and Ahmed 1, LLC, jointly, (Rec. Doc. 18)

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is GRANTED IN PART to dismiss with prejudice the revocatory actions asserted
against Defendants; DENIED IN PART as to Brothers’ claims against Jadallah
Enterprises and Ahmed 1 for unfair trade practices; and GRANTED IN PART to
dismiss with prejudice Brothers’ claims against Jadallah Enterprises and Ahmed
1 for unjust enrichment.
New Orleans, Louisiana this 31st day of July, 2018.

_____________________________

Carl J. Barbier
United States District Judge

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