Superior Offshore International, Inc v. Schaefer, Jr. et al

Filing 32

MEMORANDUM AND ORDER. ORDERED that the Motion to Clarify [Doc. # 28] is GRANTED to the extent that the Court clarifies that the dismissal of the claims regarding the special dividend was as to Schaefer only.(Signed by Judge Nancy F. Atlas) Parties notified.(arrivera, )

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
SUPERIOR OFFSHORE
INTERNATIONAL, INC.,
Plaintiff,
v.
LOUIS E. SCHAEFER, JR., et al.,
Defendants.

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CIVIL CASE NO. H-11-3130

MEMORANDUM AND ORDER
This case is before the Court on the Motion to Clarify [Doc. # 28] filed by
Plaintiff Superior Offshore International, Inc. (“Superior”).

Plaintiff seeks

clarification regarding whether the Court dismissed the claims arising out of a special
dividend paid to Defendant Louis Schaefer, Jr. as to Schaefer only or as to all
Defendants. Defendants Louis E. Schaefer, Jr., James J. Mermis, Roger D. Burks, and
Joshua Koch filed a Response [Doc. # 29], and Plaintiff filed a Reply [Doc. # 30]. As
explained more fully herein, the Court clarifies that Defendants in their Motion to
Dismiss [Doc. # 3] sought and briefed a request for dismissal of the special dividend
claim “against Schaefer,” and that is the relief granted by the Court.
Plaintiff alleged that Defendants breached their fiduciary duty by improperly
paying a $28,000,000.00 special dividend to Schaefer. The Plan Agent in H. Malcolm
Lovett, Jr., Plan Agent, v. Louis E. Schaefer, et al., Adversary No. 09-3263 (the
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“Lovett Adversary”), challenged the same special dividend as a fraudulent transfer.
Defendants Koch, Mermis and Burks were not parties to the Lovett Adversary. The
Lovett Adversary was settled; the parties therein executed a Settlement Agreement and
filed a Joint Stipulation of Dismissal with the Bankruptcy Court. The Joint Stipulation
of Dismissal stated that the parties had “resolved the issues that formed the basis of
this adversary” and the Lovett Adversary was dismissed with prejudice.
Defendants argued in their Motion to Dismiss that Plaintiff “is barred by res
judicata from bringing any claims against Schaefer related to payment of the special
dividend.” See Motion to Dismiss [Doc. # 3], p. 2. Later in the Motion to Dismiss,
Defendants again asserted that “res judicata bars claims against Schaefer regarding the
special dividend and stock sale.” See id. at 11. Defendants argued that the res
judicata requirement for identity of parties was satisfied because the Plan Agent and
Plaintiff in this case were both acting for the benefit of Superior and, as a result,
Superior and Schaefer are the real parties in interest in both proceedings. See id. at 13.
Defendants did not argue in the Motion to Dismiss or in the Reply that Mermis, Koch
and Burks were in privity with Schaefer and, therefore, the identity of parties
requirement was satisfied as to these three individual defendants. Defendants argued
only that the Court should “dismiss the claims asserted against Schaefer regarding the

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special dividend and the stock sale because they are barred by res judicata. Schaefer
has already settled those claims.” See id. at 17.
In their Reply, Defendants continued to argue that the “claims against Schaefer
are barred by res judicata” and challenged Plaintiff’s position that res judicata did
“not bar the claims against Schaefer arising out of the special dividend.” See Reply
in Support of Motion to Dismiss [Doc. # 5], pp. 2, 6. As they did in their Motion to
Dismiss, Defendants argued in their Reply that the Court “should dismiss the claims
asserted against Schaefer regarding the special dividend . . ..” See id. at 7.
The Court considered Defendants’ Motion to Dismiss as presented and agreed
that the claims against Schaefer regarding the special dividend were barred by res
judicata, noting specifically that the “identity of parties” requirement was satisfied
because Plaintiff and the Plan Agent in the Lovett Adversary were in privity with
Superior. See Memorandum and Order [Doc. # 7], pp. 8-9. Based on the Court’s
statement at page 12 of the Memorandum and Order that “Defendants are entitled to
dismissal of the claims based on the special dividend,” Defendants Mermis, Koch and
Burks now take the position that the Court dismissed the claims as against them also.
Defendants Mermis, Koch, and Burks misconstrue the Court’s statement. Defendants
collectively moved to dismiss the special dividend claims against Schaefer, and the

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Court granted Defendants’ collective Motion as to those claims against Schaefer. See
id. at 12. Accordingly, it is hereby
ORDERED that the Motion to Clarify [Doc. # 28] is GRANTED to the extent
that the Court clarifies that the dismissal of the claims regarding the special dividend
was as to Schaefer only.
SIGNED at Houston, Texas, this 19th day of December, 2011.

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