CAM Logistics, LLC v. Pratt Indus.
| Decision Date | 11 August 2021 |
| Docket Number | Civil Action 1:20-CV-00445 |
| Parties | CAM LOGISTICS, L.L.C., Plaintiff v. PRATT INDUSTRIES, INC., ET AL., Defendants |
| Court | U.S. District Court — Western District of Louisiana |
CAM LOGISTICS, L.L.C., Plaintiff
v.
PRATT INDUSTRIES, INC., ET AL., Defendants
Civil Action No. 1:20-CV-00445
United States District Court, W.D. Louisiana, Alexandria Division
August 11, 2021
DRELL, JUDGE
AMENDED REPORT AND RECOMMENDATION
JOSEPH H.L. PEREZ-MONTES, UNITED STATES MAGISTRATE JUDGE
Before the Court are the following opposed motions: (1) a Motion to Dismiss for Lack of Jurisdiction, Motion to Transfer (“Motion to Dismiss”) (ECF No. 15) filed by Defendants Pratt Industries, Inc. (“Pratt Industries”), Pratt (Rockwall Corrugating), L.L.C. (“Rockwall”) (collectively, “Defendants”); and (2) a Motion for Leave to File First Amended Complaint (“Motion to Amend”) (ECF No. 38) filed by Plaintiff CAM Logistics, L.L.C. (“CAM”). Defendants seek dismissal for lack of subject matter jurisdiction, lack of personal jurisdiction, improper venue, and failure to state a claim for relief. ECF No. 15-1. Alternatively, Defendants seek to transfer venue under 28 U.S.C. § 1404(a). Id. CAM opposes (ECF No. 27) and seeks to amend (ECF No. 38) its Complaint (ECF No. 1) to “correct misstatements” and more fully set forth underlying facts.
Defendants' Motion to Dismiss (ECF No. 15) should be DENIED IN PART and GRANTED IN PART. The Court lacks general personal jurisdiction over all Defendants. And the Court lacks specific personal jurisdiction over Pratt
Industries, Inc.. Thus, Defendants' Motion to Dismiss (ECF No. 15) should be GRANTED IN PART to the extent Defendants seek dismissal for lack of personal jurisdiction over Pratt Industries, Inc.
Because the Court has diversity jurisdiction; because the Court has specific personal jurisdiction over Rockwall only; and because venue is proper; Defendants' Motion to Dismiss (ECF No. 15) should be DENIED IN PART to the extent they assert lack of subject matter jurisdiction, lack of personal jurisdiction over Rockwall, and improper venue.
Because transfer to Delaware under 28 U.S.C. § 1404(a) is unwarranted, Defendants' alternative Motion to Transfer (ECF No. 15) should be DENIED.
And Because Louisiana choice of law rules and Louisiana law govern CAM's claims and CAM states plausible claims for breach of contract and detrimental reliance against Rockwall, Defendants' Motion to Dismiss (ECF No. 15) should be DENIED IN PART to the extent Defendants seek dismissal for failure to state a claim for relief.
Because CAM timely seeks to amend, because Defendants did not oppose, and because no relevant factors are present, CAM's Motion to Amend (ECF No. 38) should be GRANTED allowing CAM's proposed amendment (ECF No. 38-2).
I. Background
CAM filed a Complaint (ECF No. 1) for anticipatory breach of contract, or alternatively detrimental reliance, under this Court's diversity jurisdiction. ECF No. 1. CAM is a limited liability company (L.L.C.), whose sole member is Susan
Stedman, a domiciliary of Ohio. Id. at 1. CAM further alleges Defendant Pratt Industries is incorporated in Delaware, with its principal place of business in Georgia. Id. at 2. And Defendant Rockwall Corrugating is an L.L.C. whose sole member is Pratt Corrugated Holdings, Inc., which is incorporated in Delaware, with its principal place of business in Georgia. Id.
The dispute arises from an alleged breach of contract for warehousing services by CAM for Defendants. CAM is a business that specializes in supply chain services and solutions, including freight shipment and warehousing. Id. Pratt Industries is a corrugated packaging company and its subsidiary Rockwall Corrugating operates a facility in Rockwall, Texas that produces recycled paper and packaging. Id.
On October 23, 2017, Richard Turner (“Turner”), a representative of Defendants, and Patrick Shea (“Shea”), a representative of CAM, began discussions at a conference in Detroit, Michigan for warehousing services for Defendants. Id. CAM alleges Defendants wanted warehousing services in Central Louisiana for a three-year minimum term. Id. at 3. CAM asserts Defendants had recently received a contract from Proctor & Gamble Company (“P&G”) and needed a local warehouse in Central Louisiana to ship its products. Id. In October of 2017, CAM informed Defendants it was interested in bidding on the three-year warehousing services contract. Id.
On October 24, 2017, Defendants sent details of its warehousing needs to CAM, advising that Defendants' new contract with P&G had an initial three-year
term of January 1, 2018 to December 31, 2020. Id. CAM alleges Defendants expected the warehousing services for that same term. Id.
To provide a bid for the contract, CAM priced elements for warehousing services, including a lease with a three-year term. Id. CAM sent its bid to Defendants on December 1, 2017, including the warehousing pricing. Id. at 4. CAM contends negotiations took place on the pricing, and after CAM lowered its pricing by five percent, Defendants accepted CAM's bid on December 6, 2017. Id.
On December 11, 2017, CAM sent a draft written agreement titled “Warehousing and Logistics Services Agreement” (the “Agreement”) to Defendants. Id. As part of the bid and Agreement, prior to the award, CAM began discussions for a warehousing lease with a three-year term coinciding with the P&G contract. Id. at 5. CAM alleges Defendants assisted when issues arose in the lease negotiations. Id. at 5. Relying on the award and with Defendants' assistance, CAM avers it secured the warehousing lease in late 2017 with a term from January 1, 2018 to December 31, 2020. Id. at 6.
CAM alleges it discussed the status of the Agreement with Defendants' General Manager John Batts (“Batts”) in late December 2017. Id. Batts advised it was with their legal group. Id.
While a written contract had not been entered, CAM asserts it began performance of the Agreement by providing warehousing services in January 2018. Id. CAM contends it invoiced Defendants, who paid the monthly invoices as contemplated under the Agreement. Id.
On February 13, 2018, Batts sent a draft of the Agreement to CAM with questions from their legal department, none relating to the essential terms. Id. On April 24, 2018, Batts sent the Agreement to CAM with their edits, which was approved by the President of Pratt Industries John Day (“Day”) and their legal department. Id. at 7. CAM alleges this draft recognized the parties were already operating under the previously negotiated terms, effective January 1, 2018. Id. CAM alleges the parties unintentionally did not complete its execution. Id. CAM asserts the parties have operated under certain agreed upon terms reflected in the Agreement since January of 2018. Id. In March of 2020, Defendants informed CAM it would no longer use its warehousing services beginning May 1, 2020 and would no longer remit monthly payments. Id. at 7-8.
On April 1, 2020, CAM initiated this suit for anticipatory breach of contract and detrimental reliance. Id. at 8. CAM contends it will suffer damages, including the monthly payments due under the Agreement from May 2020 to December 2020, a total of $445, 829.28. Id. CAM seeks monetary damages, attorney fees, costs, and interest. Id. CAM further alleges it relied on representations, promises, and conduct of Defendants that they would require warehousing services for a three-year period. Id. at 8-9. Based on the representations and award by Defendants, CAM entered a three-year warehousing lease, outfitted the leased premises, and secured equipment for the warehousing services. Id. at 9. CAM seeks damages for the sum of the remainder of the lease payments for May 2020 to December 2020,
prorated expenses for the outfitting of the warehouse and equipment, and any and all out of pocket expenses, costs, and interest. Id.
Defendants answered, asserting various affirmative defenses. ECF No. 8. Defendants now seek dismissal for lack of subject matter jurisdiction, lack of personal jurisdiction, improper venue, and failure to state a claim for relief. ECF No. 15. In support, Defendants submit the Declaration of Turner (ECF No. 15-2); the Declaration of Batts (ECF No. 15-3); and a draft of the Agreement (ECF No. 154). On July 28, 2020, the Court granted jurisdictional discovery limited to the issue of personal jurisdiction. ECF No. 26.
CAM opposes dismissal. ECF No. 34. In support, CAM submits: (1) the Declaration of Shea (ECF No. 34-1), including attached exhibits; (2) Defendants' Responses to Jurisdictional Discovery (ECF No. 34-2); and (3) a manual attachment of a video of Batts (ECF No. 34-3).
CAM also responds with a Motion for Leave to File First Amended Complaint (“Motion to Amend”) (ECF No. 38) to “correct misstatements in the original Compliant, including, but not limited to, Paragraph 31, and to more fully set forth the underlying facts.” ECF No. 38. Defendants did not file an opposition.
II. Law and Analysis
A. Standards governing a Rule 12(b)(1) Motion to Dismiss.
It is well settled that when a Rule 12(b)(1) motion is filed in conjunction with other Rule 12 motions, the Court should consider the Rule 12(b)(1) jurisdictional motion before addressing any attack on the merits. Hill v. City of Pasadena, 561
F.2d 606, 608 (5th. Cir. 1977) (per curiam). Therefore, the Court considers Defendants' jurisdictional arguments first.
Motions filed under Rule 12(b)(1) of the Federal Rules of Civil Procedure allow a party to challenge the subject matter jurisdiction of the district court to hear a case. Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001); see also Fed.R.Civ.P. 12(b)(1). A district court may dismiss an action for lack of subject matter jurisdiction on any one of three separate bases: (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts. Ramming, 281 F.3d at 161.
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