Petro Marine Underwriters, Inc. et al v. Cox Operating, L.L.C. et al
Filing
86
ORDER denying 57 Defendants' Motion for Summary Judgment and granting in part and denying in part 59 Plaintiffs' Motion for Partial Summary Judgment. Defendants motion is denied as set forth in document and Plaintiffs' motion is granted in part and denied in part as set forth in document. Signed by Judge Greg Gerard Guidry on 03/31/2020. (ko)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
PETRO-MARINE UNDERWRITERS,
INC. ET AL.
CIVIL ACTION
VERSUS
NO. 2:17-cv-09955
COX OPERATING, LLC, ET AL.
SECTION: T(2)
ORDER
Before this Court are two Motions for Summary Judgment. Cox Operating, L.L.C. and Cox
Oil Offshore, L.L.C. (“Cox Entities” or “Defendants”) filed a Rule 56 Motion for Summary
Judgment against Petro-Marine Underwriters, Inc. and Delta Energy Management and
Consultants, L.L.C. (“Petro-Marine” or “Plaintiffs”), entitled “Motion for Summary Judgment on
Plaitniffs’ Claims and, in the alternative, Motion for Summary Judgment on Defendants’ Defense
of Error .1 Additionally, Plaintiffs filed a Rule 56 Motion for Partial Summary Judgment against
Defendants on the issue of liability. 2 For the following reasons, Defendants’ Motion for Summary
Judgment 3 is DENIED, and Plaintiffs’ Motion for Partial Summary Judgment 4 is GRANTED IN
PART and DENIED IN PART.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff Petro-Marine Underwriters, Inc., provides surety bond broker services, 5 while
Plaintiff Delta Energy Management Consultants, LLC, provides consulting services. 6 Defendants,
R. Doc. 57.
R. Doc. 59.
3
R. Doc. 57.
4
R. Doc. 59.
5
R. Doc. 57-1, pp.3-4.
6
R. Doc. 57-1, p.4.
1
2
1
the Cox Entities, are engaged in oil and gas exploration and production. 7 This breach of contract
dispute arises out of an arrangement between Plaintiffs and Defendants for the payment of bond
commissions to Plaintiffs in exchange for consulting services they provided and would provide in
assisting the Defendants with the acquisition of certain assets from Chevron USA, Inc.
(“Chevron”) located in the Gulf of Mexico and the placement of any supplemental bonding. 8
Plaintiffs assert Defendants failed to designate Petro-Marine as a co-broker on the surety bonds so
that Plaintiffs would be paid the contracted-for commission payments and, therefore, breached the
agreement between them. 9 Defendants filed a counterclaim asserting Plaintiffs did not perform, or
did not adequately perform, the services contemplated between the parties and therefore have
breached the agreement such that no amounts are owed. 10
According to the pleadings, Defendants engaged Plaintiffs to provide consulting services
regarding financial responsibility requirements relating to assets Defendants sought to acquire
from Chevron in its 2015 offering (“Cox-Chevron transaction”). 11 Before the parties executed a
contract, Plaintiffs performed work for Defendants by writing reports to Defendants and attending
meetings on Defendants’ behalf in Louisiana and Texas. 12 On August 27, 2015, Plaintiffs provided
Defendants with a proposed contract that included compensation for work performed. 13
Defendants, however, did not enter into this contract. 14 Thereafter, Defendants conferred with their
insurance broker, McGriff, Seibels, & Williams, Inc. (“McGriff”), about compensating Plaintiffs
R. Doc. 57-1, p.3.
R. Doc. 1.
9
Id.
10
R. Doc. 10.
11
R. Doc. 57-1, p.3; R. Doc. 59-6, p.1.
12
Id.
13
R. Doc. 57-1, p.4.
14
Id.
7
8
2
for their services on the Cox-Chevron transaction. 15 McGriff, via email dated September 3, 2015,
informed Defendants that McGriff would be willing to share commissions with Plaintiffs. 16
On September 9, 2015, the Defendants executed an agreement with Plaintiffs via email
(“Email Agreement”). 17 Subsequently, the parties formalized their Email Agreement in another
agreement (“Letter Agreement”). 18 The parties entered into the Letter Agreement a few weeks
after the Email Agreement and back-dated it to September 9, 2015. 19 The Email Agreement
detailed the sharing of commissions between Plaintiffs and McGriff. 20 The Letter Agreement
detailed the sharing of commissions between Plaintiffs and the “Broker or Agent actually acquiring
such surety on behalf of Cox.” 21 McGriff was ultimately the broker that acquired the surety on
Cox’s behalf. 22 Further, the Letter Agreement provided that “Petro-Marine Underwriters, Inc. will
be made co-broker on all bonds placed on properties purchased from Chevron and is entitled to
the above referenced commission structure as long as a Cox-related entity has an any [sic] interest
in these properties.” 23
In the fall of 2015, oil prices dropped; the future of the Cox-Chevron transaction looked
dubious. 24 Defendants notified Plaintiffs of the transaction’s uncertainty and advised Plaintiffs that
they could invoice Defendants for their performed work. 25
15
Id.
Id.
17
R. Doc. 59-6, p.1.
18
R. Doc. 59-6, p.2.
19
R. Doc. 57-1, p.6; R. Doc. 59-6, p.2.
20
R. Doc. 57-2, Ex. A-6.
21
R. Doc. 57-2, Ex. A-9.
22
R. 57-1, p.7.
23
R. Doc. 57-2, Ex. A-9.
24
R. Doc. 57-1, p.6.
25
Id.
16
3
On December 9, 2015, Defendants, Chevron, and Union Oil Company of California
(“Union Oil”) entered into an Asset Sale and Purchase Agreement (“ASPA”), which transferred
assets to Defendants. 26 The ASPA required Defendants to place a $48 million performance bond. 27
The deal closed on April 15, 2016. 28 Due to regulation of all offshore operators with the Bureau
of Ocean Energy Management (“BOEM”), Defendants placed two additional bonds: a $3 million
operator’s bond and a $300,000 right-of-way bond. 29 Defendants acquired all three bonds through
Aspen American Insurance Company (“Aspen”), a bond surety company. 30 Each of the bonds was
issued effective April 15, 2016.31 McGriff solely brokered all three bonds. 32
In mid-2017, after learning of the bond placements, Plaintiffs sent a letter to Defendants,
demanding commissions from the bond placements. 33 Defendants responded by letter, denying an
obligation to pay commissions to Plaintiffs, noting that the bonds were not obtained through
Plaintiffs’ efforts. 34 Also, in the letter, Defendants terminated the Letter Agreement.
In response, Plaintiffs filed this suit alleging breach of contract.35 Defendants filed a motion
for summary judgment asserting that (1) Plaintiffs’ breach of contract claim fails because the Email
Agreement and Letter Agreement provide that a surety, not Defendants, shall pay the commissions;
(2) Plaintiffs are not entitled to the commissions because Plaintiffs were not the procuring cause
of the bonds; and (3) in the alternative, the Letter Agreement should be rescinded because error
R. Doc. 57-1, p.7.
Id.
28
Id.
29
Id.
30
Id.; R. Doc. 59-5, p.7.
31
R. Doc. 57-1, p.7.
32
Id.; R. Doc. 59-5, p.7.
33
R. Doc. 57-2, Ex. A-15.
34
R. Doc. 57-2, Ex. A-16.
35
R. Doc. 1.
26
27
4
concerning the Agreement’s cause vitiated Defendants’ consent.36 Plaintiffs filed an opposition to
Defendants’ motion for summary judgment. 37 With leave of court, Defendants filed a reply to
Plaintiffs’ opposition. 38
Additionally, Plaintiffs filed a motion for partial summary judgment. 39 Plaintiffs contend
that (1) the Letter Agreement required a surety company to compensate Plaintiffs for the already
completed work, but (2) because Defendants did not designate Petro-Marine Underwriters, Inc. as
co-broker on all bonds placed on properties purchased from Chevron, the surety company did not
compensate Plaintiffs. 40 Defendants filed an opposition to Plaintiffs’ motion for partial summary
judgment.41 With leave of court, Plaintiffs filed a reply to Defendants’ opposition. 42
LAW AND ARGUMENT
I. Summary Judgment
Summary judgment is proper where “the movant shows that there is no genuine dispute as
to any material fact and the movant is entitled to judgment as a matter of law.” 43 When assessing
whether a dispute as to any material fact exists, the court considers “all of the evidence in the
record but refrains from making credibility determinations or weighing the evidence.” 44 All
reasonable inferences are drawn in favor of the nonmoving party, but “unsupported allegations or
affidavits setting forth ‘ultimate or conclusory facts and conclusions of law’ are insufficient to
R. Doc. 57-1.
R. Doc. 66.
38
R. Doc. 84.
39
R. Doc. 59.
40
R. Doc. 59-1.
41
R. Doc. 69.
42
R. Doc. 76.
43
Fed. R. Civ. P. 56(a).
44
Delta & Pine Land Co. v. Nationwide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 2008).
36
37
5
either support or defeat a motion for summary judgment.” 45 The party seeking summary judgment
bears the burden of demonstrating the absence of a genuine issue of material fact. 46 “Once the
movant does so, the burden shifts to the nonmovant to establish an issue of fact that warrants
trial.” 47
A. Contract Interpretation
A federal court sitting in diversity must apply the substantive law of the state in which it
sits. 48 Under Louisiana law, the interpretation of a contract is a question of law for the court. 49
“Interpretation of a contract is a determination of the common intent of the parties.” 50 “When the
words of a contract are clear and explicit and lead to no absurd consequences, no further
interpretation may be made in search of the parties’ intent.” 51 Additionally, a provision is
unambiguous “where only one of two competing interpretations is reasonable or merely because
one party can create a dispute in hindsight.”52
Here, there is no dispute that this Court has diversity jurisdiction over this lawsuit;
therefore, Louisiana law applies to this breach of contract claim.
The parties do not dispute (1) that “the surety company” was to pay the commissions
(splitting the commissions between Plaintiffs and McGriff) and (2) that Plaintiffs, prior to the
45
Galindo v. Precision Am. Corp., 754 F.2d 1212, 1216 (5th Cir. 1985); Little v. Liquid Air Corp., 37 F.3d 1069,
1075 (5th Cir. 1994).
46
Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986).
47
Smith v. Reg'l Transit Auth., 827 F.3d 412, 420 n.4 (5th Cir. 2016).
48
Phillips v. Correct Care Sols., Inc, No. CV 16-16551, 2017 WL 367663, at *3 (E.D. La. Jan. 25, 2017) (citing
Erie v. Tompkins, 304 U.S. 64, 71-77 (1938)).
49
Tulane Hotel Inv'rs Corp. v. First Fin. Bank, F.S.B., No. CIV. A. 84-6127, 1987 WL 15651, at *3 (E.D. La. Aug.
7, 1987) (citing Chevron U.S.A., Inc. v. Belco Petroleum Corp., 755 F.2d 1151, 1153, reh. denied, 761 F.2d 695 (5th
Cir.), cert. denied, 106 S. Ct. 140, 88 L.Ed.2d 116 (1985)).
50
La. Civ. Code art. 2045.
51
La. Civ. Code art. 2046.
52
Texas E. Transmission Corp. v. Amerada Hess Corp., 145 F.3d 737, 741 (5th Cir. 1998) (citing Lloyds of London
v. Transcontinental Gas Pipe Line Corp., 101 F.3d 425, 429 (5th Cir. 1996); Rutgers, State Univ. v. Martin
Woodlands Gas Co., 974 F.2d 659, 662 (5th Cir. 1992)).
6
execution of the Letter Agreement, had already performed services for Defendants. 53 However,
the parties dispute whether the procuring cause doctrine applies here and whether Defendants had
an affirmative duty to designate Petro-Marine as a co-broker on the bonds at issue. For the reasons
set forth below, this Court finds no ambiguity in the contested provisions of the Letter Agreement.
The Court further finds that the procuring cause doctrine does not apply and that Defendants had
an affirmative duty under the Letter Agreement to designate Petro-Marine as a co-broker on the
bonds at issue.
First, the Court finds the procuring cause doctrine does not apply under the facts of this
case. Plaintiffs assert they were not required to be the ultimate broker to be compensated. Plaintiffs
contend the Letter Agreement merely provides the “payment mechanism” to compensate Plaintiffs
for past and potential future services, and for these reasons, the Letter Agreement is not a broker
agreement and thus the procuring cause doctrine does not apply. Defendants counter that the Letter
Agreement is a broker agreement, and, because the agreement is non-exclusive, the procuring
cause doctrine applies. Plaintiffs have the better argument under the facts of this case.
The Letter Agreement states in pertinent part:
In accordance with our [Email] Agreement dated September 9, 2015
between [Cox Entities and Petro-Marine], the parties have agreed to the following:
Delta and Petro have already provided, and may continue to provide, certain
consulting services to Cox with regard to the acquisition of Chevron assets and on
regulatory issues regarding financial assurances to the federal government and oil
and gas.
Compensation due Delta and/or Petro for these services shall be due
and payable on the initial placement and any subsequent renewals of any
surety bonding placed on behalf of any Cox entity which resulted from the
acquisition by Cox of interests in certain assets of Chevron in the Gulf of Mexico
in Chevron’s 2015 offering, regardless of the brokers or agents involved, for as
long as Cox owns any interest in those assets. This compensation is due at the initial
placement of any such security whenever that individual event occurs, it being
recognized that the assets may likely be bonded over a period of time. At the time
53
R. Doc. 69, pp.8-10; R. Doc. 84, pp.2-3.
7
of an initial placement of any surety relating to the Chevron assets to be acquired
on behalf of any Cox entity, Petro-Marine shall receive 65% of the standard
commission for the Bond (by the surety company) with the remaining 35% going
to the Broker or Agent actually acquiring such surety on behalf of Cox. All
reasonable expenses incurred by Delta and Petro, such as requested travel, etc., will
be reimbursed by Cox.
Regarding all surety renewals, the split for all compensation received,
either as commissions or for service or management fees, split of compensation
will be reversed with 65% of all compensation, service fees or gross income
received from renewals going to the placing Broker or Agency (or to their
interest) and the remaining 35% paid to Petro. All compensation to Petro must
be paid within 14 days of payment by Cox or its interests.
It is further agreed that Petro-Marine Underwriters, Inc., will be made
co-broker on all bonds placed on properties purchased from Chevron and is
entitled to the above referenced commission structure as long as a Cox related
entity has an any [sic] interest in these properties. Petro-Marine Underwriters,
Inc. will be entitled to full access to of all [sic] Cox documents relating to the
properties bonded including all financial information concerning bonds, premium
paid, consulting fees, monthly bonding accounts, commissions, management, or
service fees on those bonds whether in possession of Cox, its Brokers or Agents,
its sureties, or regulatory agencies. 54
The Court finds this Letter Agreement to be clear and unambiguous in that it specifically
does not obligate the Plaintiffs to be the sole or procuring brokers on the bonds at issue to be
compensated by the surety company. The agreement provides that Plaintiffs will be compensated
for services that Plaintiffs “have already provided, and may continue to provide….” 55 The “already
provided” provision reasonably encompasses services Plaintiffs previously performed on behalf
of Defendants, whereas, the “may continue to provide” provision contemplates the performance
of future services, but it does not obligate Plaintiffs to perform such future services to be
compensated. Furthermore, the Letter Agreement specifies that Plaintiffs shall be compensated,
“….upon the initial placement and any subsequent renewals of any surety bonding placed on behalf
of any Cox entity … regardless of the brokers or agents involved, for as long as Cox owns any
54
55
R. Doc. 57-2, Ex. A-9 (emphasis added); R. Doc. 59-7.
Id.
8
interest in those assets.” 56 Thus, the Letter Agreement provides for a 65-35 reciprocal commission
sharing scheme upon initial placement of the surety bonds and a reversed commission sharing
scheme, 35-65, for renewal of the bonds, regardless whether Petro-Marine is a placing broker or
agent. Differentiating between Petro and the “placing Broker or Agency” and compensating
Plaintiffs “regardless of the brokers or agents,” the parties clearly intended for Plaintiffs, whether
or not the actual broker or agency on the Cox-Chevron transaction, to be compensated. As a result,
the Court finds the Letter Agreement is a contract between Cox and Petro-Marine, rather than a
broker agreement, and, therefore, the procuring cause doctrine, by the contract’s own terms, is not
applicable.
The Court next finds that Defendants had an affirmative duty to designate Petro-Marine as
a co-broker on the bonds at issue. The Letter Agreement unambiguously states that “Petro-Marine
Underwriters, Inc. will be made co-broker on all bonds placed on properties purchased from
Chevron and is entitled to the above referenced commission structure as long as a Cox related
entity has an any [sic] interest in these properties.” 57 The parties put forth two interpretations of
this provision: (1) the provision requires Defendants to designate Petro-Marine as a co-broker,
providing the “payment mechanism” for Plaintiffs’ services 58 or (2) the provision does not require
Defendants to designate Petro-Marine as a co-broker. 59 Plaintiffs contend that, if the provision
does not place an affirmative duty on Defendants to designate Petro-Marine as a co-broker, then
R. Doc. 57-2, Ex. A-9.
Id.
58
R. Doc. 59-5, p.13-14; R. Doc. 76, p.4; R. Doc. 66-3, p.8-10.
59
R. Doc. 69, p.10-13; R. Doc. 84, p.3-4.
56
57
9
Defendants have no obligations under the Letter Agreement. 60 Whereas, Defendants assert that the
provision does not obligate either party to designate Petro-Marine as a co-broker. 61
Under Plaintiffs’ interpretation, the Letter Agreement obligates Defendants to designate
Petro-Marine as a co-broker providing for the “payment mechanism” for Plaintiffs’ services. This
is certainly reasonable because the Letter Agreement sets forth the commission-sharing structure
to compensate Plaintiffs for “already provided” and potential future services.
Under Defendants’ interpretation, the Letter Agreement obligates no one to designate
Petro-Marine as a co-broker on the bonds at issue. If so, the Court can only question why the
agreement would include such a provision? Also, how is the surety company, as detailed in the
Letter Agreement, to compensate Plaintiffs if no party is obligated to designate Plaintiffs as a cobroker? Defendants’ proposed interpretation cuts squarely against the Letter Agreement’s stated
purpose of compensating Plaintiffs for “already provided” and potential future services.
Because only one of the competing interpretations is reasonable, the Court finds the
provision at issue to be unambiguous. 62 The Court thus finds that the Letter Agreement obligated
Defendants to designate Petro-Marine as a co-broker on the bonds at issue so that Plaintiffs could
be compensated according to the agreement. Because Defendants did not designate Petro-Marine
as a co-broker on the bonds at issue, and Plaintiffs were not compensated pursuant to the Letter
Agreement, the Court must conclude Defendants breached their obligations under the Letter
Agreement.
R. Doc. 76, pp.3-4.
R. Doc. 84, p.4; R. Doc. 69-4, p.11.
62
Texas E. Transmission Corp. v. Amerada Hess Corp., 145 F.3d 737, 741 (5th Cir. 1998) (citing Lloyds of London
v. Transcontinental Gas Pipe Line Corp., 101 F.3d 425, 429 (5th Cir. 1996); Rutgers, State Univ. v. Martin
Woodlands Gas Co., 974 F.2d 659, 662 (5th Cir. 1992)).
60
61
10
B. Defenses of Error
Defendants alternatively assert they are entitled to summary judgment based on the
affirmative defense of error. Specifically, Defendants contend they unilaterally erred on who
would pay Plaintiffs’ commissions and the parties bilaterally erred on who would designate PetroMarine a co-broker.
Under Louisiana law, a party’s consent “may be vitiated by error, fraud, or duress”. 63 If
error vitiates a party’s contractual consent, the contract may be rescinded. 64 Error can be unilateral
or bilateral. 65 Bilateral error occurs when both parties misunderstand each other at the time of
contracting. 66 Specifically, bilateral error vitiates consent only when the bilateral error “concerns
a cause without which the obligation would not have been incurred and that cause was known or
should have been known to the other party.” 67Cause is the reason why a party binds himself. 68
Further, error as to a cause occurs
when it bears on the nature of the contract, or the thing that is the contractual object
or a substantial quality of that thing, or the person or the qualities of the other party,
or the law, or any other circumstance that the parties regarded, or should in good
faith have regarded, as a cause of the obligation. 69
Bilateral error is a factual, not legal, determination. 70
First, this Court finds no merit in Defendants’ contention that Plaintiffs interpret the Letter
Agreement to require Defendants to pay Plaintiffs’ commissions. As previously noted, the parties
La. Civ. Code art. 1948.
Chalos & Co., P.C. v. Marine Managers, Ltd., No. CIV. A. 14-2441, 2015 WL 6442558, at *7 (E.D. La. Oct. 23,
2015) (citing Cyprien v. Bd. of Supervisors ex rel. Univ. of La., 5 So. 3d 862, 868 (La. 2009)).
65
La. Civ. Code art. 1949, cmt. (d).
66
La. Civ. Code art. 1949 (citing Lyons Milling Co. v. Cusimano, 161 La. 198, 108 So. 414 (1926)).
67
La. Civ. Code art. 1949.
68
La. Civ. Code art. 1967.
69
La. Civ. Code art. 1950.
70
Spencer Franchise Servs. of Georgia, Inc. v. Wow Cafe & Wingery Franchising Account, L.L.C., 624 F. App'x
842, 845 (5th Cir. 2015) (citing Peironnet v. Matador Res. Co., 144 So. 3d 791, 809 (La. 2013) (“[W]e must review
the record evidence and determine if the jury erred in its factual conclusions regarding mutual error.”)).
63
64
11
agree the Letter Agreement provided for the surety company to pay Plaintiffs’ commissions. 71
Plaintiffs merely seek damages for breach of contract. 72 Therefore, Defendants’ defense of
unilateral error as to who would pay Plaintiffs’ commissions is unfounded.
Second, Defendants have offered no competent summary judgment evidence that the
parties intended for a party other than Defendants to designate Petro-Marine as a co-broker on the
surety bonds at issue. Instead, Plaintiffs have produced competent summary judgment evidence to
support their burden of proving that the parties intended for Defendants, and only Defendants, to
designate Petro-Marine as a co-broker on the bonds at issue. 73 The Court can discern no genuine
factual dispute as to whether the parties intended for someone other than Defendants to designate
Petro-Marine as a co-broker on the surety bonds in order to be compensated pursuant to the
agreement. The Court thus finds Defendants’ defense of bilateral error is also unfounded.
C. Bad Faith
Under Louisiana law, “[a]n obligor is liable for the damages caused by his failure to
perform a conventional obligation.” 74 “Damages are measured by the loss sustained by the obligee
and the profit of which he has been deprived.” 75 “An obligor in good faith is liable only for the
damages that were foreseeable at the time the contract was made.” 76 “An obligor is in bad faith if
he intentionally and maliciously fails to perform his obligation.” 77 Bad faith “generally implies
R. Doc. 57-1, p.10; R. Doc. 66-3, p.20.
R. Doc. 59-5, p.2.
73
Scott Sewell Dep. 116:3-6, May 15, 2019 (Plaintiffs’ owner and chairman testified that “[a broker of record letter
is] up to Cox to provide”); Craig Sanders Dep. 183:16-18, June 20, 2019 (Defendants provided McGriff with a
broker of record letter (placing McGriff as a broker)); R. Doc. 57-2, Ex. A-3 (McGriff’s Senior Vice President
expressed to Defendants that McGriff did not want Petro-Marine to be placed as a co-broker).
74
La. Civ. Code art. 1994.
75
La. Civ. Code art. 1995.
76
La. Civ. Code art. 1996.
77
La. Civ. Code art. 1997 cmt. (b).
71
72
12
actual or constructive fraud or a refusal to fulfill contractual obligations, not an honest mistake as
to actual rights or duties.” 78 If an obligor breaches a contract in bad faith, the obligor is liable “for
all the damages, foreseeable or not, that are a direct consequence of his failure to perform.” 79
Determining whether a party breached a contract in bad faith is a factual inquiry. 80
Plaintiffs contend Defendants breached the Letter Agreement in bad faith. Plaintiffs point
to statements made by Craig Sanders and Rodney Dykes, Defendants’ CEO. 81 Mr. Sanders
testified that he took “Zero” steps to figure out how Plaintiffs would get paid. 82 Mr. Dykes testified
that if Plaintiffs had been “made co-broker or agent, then the bonding company would have paid
commissions to them and they would have been compensated.” 83
On the other hand, Defendants submit they did not act in bad faith. Supporting this
assertion, Defendants point to Mr. Dykes’s meeting with Scott Sewell and Keith Vincent. 84 In this
meeting, Mr. Dykes notified Defendants that the Cox-Chevron transaction remained uncertain and
that Plaintiffs could invoice Defendants for their work performed. 85 Also, Defendants maintain
they did not have a legal obligation to meet with and notify Plaintiffs. 86 Because there is a factual
dispute as to whether Defendants breached the agreement in bad faith, Plaintiffs’ motion for partial
Whitney Bank v. SMI Companies Glob., Inc., No. 18-31189, 2020 WL 525566, at *10 (5th Cir. Feb. 3, 2020)
(citing Delaney v. Whitney Nat’l Bank, 1996-2144 (La. App. 4 Cir. 11/12/97), 703 So. 2d 709, 718).
79
La. Civ. Code art. 1997.
80
Volentine v. Raeford Farms of Louisiana, LLC, 50,698 (La. App. 2 Cir. 8/15/16), 201 So. 3d 325, 342, writ
denied, 2016-1924 (La. 12/16/16), 212 So. 3d 1171, and writ denied, 2016-1925 (La. 12/16/16), 212 So. 3d 1171
(citing N-Y Associates, Inc. v. Board of Com'rs of Orleans Parish Levee Dist.,2004-1598 (La. App. 4th Cir.2/22/06),
926 So. 2d 20, writ denied, 06–0666 (La. 5/26/06), 930 So. 2d 31; Weeks v. T.L. James & Co., 626 So. 2d 420 (La.
App. 3d Cir.1993), writ denied, 630 So.2d 794 (La.1994). Cf. Miller v. Conagra, Inc., 08–0021 (La. 9/8/08), 991 So.
2d 445).
81
R. Doc. 59-5, pp.15-16.
82
Id.; R. Doc. 59-7, Ex. E, pp.184-86.
83
R. Doc. 59-5, pp.15-16; R. Doc. 59-7, Ex. C, p.156.
84
R. Doc. 69-4, p.16.
85
Id.; R. Doc. 57-2, Ex. C, pp.159-161.
86
R. Doc. 69-4, p.16.
78
13
summary judgment concerning Defendants’ bad faith is not warranted under the summary
judgment standard.
CONCLUSION
For the reasons set forth above, the Court finds Defendants are not entitled to summary
judgment as a matter of law, and thus Defendants’ Motion for Summary Judgment 87 is DENIED.
The Court further finds that Plaintiffs are entitled to summary judgment as a matter of law on the
issue of liability, in that Defendants were obligated under the Letter Agreement to designate
Plaintiffs as a co-broker on the surety bonds at issue in order to be compensated and failed to do
so. Accordingly, Plaintiffs’ Motion for Partial Summary Judgment 88 is GRANTED as to liability
on the part of Defendants, but the Motion is DENIED on the issue of whether Defendants acted
in bad faith.
31st
New Orleans, Louisiana, on this _____ day of March, 2020.
GREG GERARD GUIDRY
UNITED STATES DISTRICT JUDGE
87
88
R. Doc. 57.
R. Doc. 59.
14
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?