Cheramie Services, Inc. v. Shell Deepwater Production, Inc., No. 09-C-1633 (La. 4/23/2010)
| Decision Date | 23 April 2010 |
| Docket Number | No. 09-C-1633.,09-C-1633. |
| Parties | CHERAMIE SERVICES, INC. AND ATTECIA CHERAMIE v. SHELL DEEPWATER PRODUCTION, INC. AND FILCO INTERNATIONAL, INC. |
| Court | Louisiana Supreme Court |
The threshold legal issue in this case is whether persons who are neither business competitors nor consumers can bring an action for damages pursuant to the Unfair Trade Practices and Consumer Protection Law, LSA-R.S. 51:1401, et seq. (LUTPA). Finding no such limiting language in the statute, we hold the dismissal of plaintiffs' LUTPA claim against Shell Deepwater Production, Inc. (Shell) by the district court on the basis of this procedural requirement was error. Nevertheless, we find the appellate court's reversal of summary judgment dismissing plaintiffs' LUTPA claim was inappropriate because plaintiffs failed to produce evidence of a material factual dispute regarding Shell's alleged use of an "unfair or deceptive method, act or practice" in its dealings with plaintiffs.
Thus, we reverse the appellate court judgment and render judgment dismissing claimant's claims.
Plaintiffs, Cheramie Services, Inc. (Cheramie Services) and its sole owner, Attecia Cheramie, filed suit in 1999 against Shell and Filco International, Inc. (Filco) asserting several causes of action2 for damages allegedly sustained due to wrongful acts by and between the two defendants. The events leading to the filing of the petition are as follows.
Cheramie Services was one of several businesses that provided services to the oil industry, especially support personnel for offshore activities; these businesses bid on jobs for specific platforms. After submitting a successful bid to Shell, Cheramie Services first supplied clerks to Shell's "Auger" tension-leg platform (Auger TLP) in the Gulf of Mexico in 1996. In August 1997, Cheramie Services entered into a written contract with Shell "to furnish all tools, equipment, materials, labor and supervision in order to provide the furnishing of clerical support for buyer." Thereafter, Cheramie Services placed two clerks on the Auger TLP, Kenneth K. Ward and Kevin W. Kays, who each worked fourteen-day shifts. They alternated their shifts so that one of them was always on the platform. The procedure was that Shell paid Cheramie Services, and Cheramie Services in turn paid Ward and Kays $13.00 per hour, with no benefits for vacation, retirement, or insurance. Cheramie Services made no deductions for income tax or social security taxes.
Approximately six months later, Shell stopped paying Cheramie Services and began paying Filco for services provided by Ward and Kays. In support of a motion for summary judgment filed by Shell, Ward and Kays signed affidavits which attested to the fact that they voluntarily quit Cheramie Services and went to work for its competitor, Filco. The plaintiffs allege in their petition that Shell's actions constituted a wrongful termination of the contract and a breach of contract in January of 1998.
Although plaintiffs also allege collusion on the part of Shell and Filco regarding a Cheramie Services worker by the name of Mary Perez, Shell introduced the deposition testimony of Ms. Cheramie that is at odds with this allegation. Shortly after Ward and Kays switched parent companies (late 1997 to early 1998), according to Ms. Cheramie's testimony, she called Shell which had a need for a logistics coordinator aboard the Ursa TLP. Ms. Cheramie met with a Shell representative and submitted a bid to provide workers for the Ursa TLP and provided the resume of Mary Perez, who had worked for Cheramie on a recent project known as the "Ram Powell" job, which had been completed. Thereafter, Perez was sent by Ms. Cheramie to One Shell Square in New Orleans to be interviewed for the position by Shell employees. Perez attested she was told that if she wanted the position she would have to work for Filco, apparently because Filco, not Cheramie Services, had submitted the successful bid. Because Perez needed the job, she chose to leave the plaintiffs' employ and work for Filco.
Shell answered the suit timely, but Filco failed to file an answer. The plaintiffs obtained a default which was confirmed by judgment on September 5, 2000. On May 2, 2001, Filco paid plaintiffs a settlement sum for dismissal of their suit against Filco.
In 2007, after the trial court granted Shell's motion for summary judgment and dismissed plaintiffs' claim in its entirety, plaintiffs appealed. They specifically argued the trial court erred in granting the motion for summary judgment finding that there was no breach of contract and that LUTPA did not apply.
The court of appeal affirmed the trial court's finding that there was no breach of contract, and plaintiffs have not challenged that holding. Thus, the breach of contract issue is not before this court.
However, the court of appeal reinstated plaintiffs' LUTPA claim. Without addressing whether the language of LUTPA limits the availability of a cause of action to consumers and business competitors, the court cited jurisprudence which allows a plaintiff to claim damages when one party conspires with a business competitor to commit unfair trade practices. The court held that the plaintiffs in the instant case made a prima facie showing that Shell conspired with Filco to injure plaintiffs, which brings their action within the ambit of LUTPA. One member of the panel concurred, noting that the range of prohibited practices under LUTPA is narrow, but concluding that Shell's conduct was "so unscrupulous and egregious" that reversal of the summary judgment was appropriate. Cheramie Services, Inc. v. Shell Deepwater Production, Inc., 07-1231 (La.App. 4 Cir. 3/4/09), 14 So.3d 1, writ granted, 09-1633 WL5698045 ((La. 11/20/09), ___ So.3d ___).
Standing to Assert a LUTPA Claim:
As previously mentioned, the threshold legal issue in this case is whether plaintiffs have standing to bring a claim for damages pursuant to LUTPA. Noting that plaintiffs are neither business competitors of Shell nor consumers, facts that plaintiffs concede, Shell has urged a lack of standing. The issue is one of first impression with this court. Although we have denied writs as early as 1982 in cases3 that have rendered contradictory holdings, we have never addressed the conflict.
At issue is an evaluation of LSA-R.S. 51:1401, et seq., Louisiana's Unfair Trade Practices and Consumer Protection Law enacted in 1972 as part of Title 51 entitled "Trade and Commerce."4 We begin as we must with the words of the statute. Grant v. Grace, 03-2021, p. 4 (La. 4/14/04), 870 So.2d 1011, 1014.
The legislation specifies that "[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful." LSA-R.S. 51:1405(A).
Entitled "Private actions," LSA-R.S. 51:1409 provides, in pertinent part:
A. Any person who suffers any ascertainable loss of money or movable property, corporeal or incorporeal, as a result of the use or employment by another person of an unfair or deceptive method, act, or practice declared unlawful by R.S. 51:1405, may bring an action individually but not in a representative capacity to recover actual damages. If the court finds the unfair or deceptive method, act, or practice was knowingly used, after being put on notice by the attorney general, the court shall award three times the actual damages sustained. In the event that damages are awarded under this Section, the court shall award to the person bringing such action reasonable attorney fees and costs. Upon a finding by the court that an action under this Section was groundless and brought in bad faith or for purposes of harassment, the court may award to the defendant reasonable attorney fees and costs.
The definition portion of LUTPA is found in LSA-R.S. 51:1402 which provides, in pertinent part:
(1) "Consumer" means any person who uses, purchases, or leases goods or services.
....
(3) "Consumer transaction" means any transaction involving trade or commerce to a natural person, the subject of which transaction is primarily intended for personal, family, or household use.
....
(8) "Person" means a natural person, corporation, trust, partnership, incorporated or unincorporated association, and any other legal entity.
(9) "Trade" or "commerce" means the advertising, offering for sale, sale, or distribution of any services and any property, corporeal or incorporeal, immovable or movable, and any other article, commodity, or thing of value wherever situated, and includes any trade or commerce directly or indirectly affecting the people of the state.
An examination of these sections of LUTPA reveals that the legislation contains no language that would clearly and expressly bar a "person" (such as the individual and the corporation that are the plaintiffs herein) from bringing an action for unfair trade practices. To the contrary, LUTPA grants a right of action to any person, natural or juridical, who suffers an ascertainable loss as a result of another person's use of unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce. Although business consumers and competitors are included in the group afforded this private right of action, they are not its exclusive members. As noted in Capitol House Preservation Company, L.L.C. v. Perryman Consultants, Inc., 98-1514, pp. 12-13 (La.App. 1 Cir. 12/10/98), 725 So.2d 523, 530, Louisiana courts have repeatedly held that there is no such limitation in LUTPA.5
An evaluation of the words of this statute leads to the conclusion that, consistent with the definition and usage of the word "person," there is no such limitation on those who may assert a LUTPA cause of action. Any such limitation that has found its way into the jurisprudence resulted without...
To continue reading
Request your trial