Presently before the Court are motions to dismiss filed by Defendants Cargill, Inc. and Louisiana Sugar Refining, LLC, pursuant to Rule 12 (b)(6) of the Federal Rules of Civil Procedure. Having carefully considered the parties' supporting and opposing submissions, and applicable law, IT IS ORDERED that Defendants' motions (Rec. Docs. 6 and 8) are GRANTED IN PART and DENIED IN PART as stated herein.
To the extent that Defendants' motions are granted, IT IS FURTHER ORDERED that these rulings are without prejudice to Plaintiffs' right to attempt to cure the identified deficiencies by amendment filed no later twenty (20) days from the entry of this Order and Reasons. Any such amendment is to be set forth in a second amended and superseding complaint. The second amended and superseding complaint must include all of the allegations from Plaintiffs' first amended complaint (Rec. Doc. 4) on which they continue to rely, as well as their amended and added allegations, such that the case can proceed on the basis of the second amended and superseding complaint without requiring further reference to prior pleadings. Should Plaintiffs fail to timelymake the necessary amendment, the Court shall, upon properly supported motion by the Defendants, order that the affected claims be dismissed with prejudice.
Louisiana Sugar Refining, LLC ("LSR"), a joint venture between Defendant Cargill, Inc. ("Cargill") and Sugar Growers and Refiners, Inc. ("SUGAR"), operates a white sugar refinery in Gramercy, Louisiana.1 Cargill and SUGAR each possess a 50 percent interest in the sugar refinery. SUGAR is a cooperative association. Plaintiffs, Peaker Energy Group., LLC ("Peaker") and Energy Coast Logistics Terminal, LLC ("ECLT"), characterize Cargill as a privately held business with worldwide operations in a variety of markets, including agriculture commodity trading and processing, food ingredients and applications, farmer services, animal feed and nutrition, energy and industrial services, and financial services.2
Plaintiff Peaker describes itself as having special expertise in rail and shipping terminals for crude oil, biofuels, natural gas liquids, and refined products, and Peaker, its agents, and consultants have used that expertise to develop, design, and manage such terminals throughout North America. Because LSR's facility enjoys important connections to both water and rail shipping, has an existing dock, is in close proximity to oil refineries, and is adjacent to farm land suitable for industrial development, Peaker devised a plan, referred to by Plaintiffs as the "Project," premised upon using LSR's terminal site as a distribution point for crude oil, refined products, natural gas liquids and biofuels. Peaker's sole member, Matthew Goitia, formed a limited liability company,Plaintiff ECLT, to execute that plan.
Seeking to move forward with the Project, Plaintiffs then approached LSR, on August 13, 2013, to propose that Plaintiffs lease certain assets at LSR's facility (referred to by Plaintiffs as the "Terminal Site"), including LSR's dock, and be allowed to utilize LSR's rail connections, in return for LSR's receipt of certain fees and certain upgrades of its infrastructure. According to Plaintiffs, the proposal to LSR included the execution of the Project at LSR's Terminal Site through ECLT.
In support of their claims, Plaintiffs also allege the following relative to the Project and their dealings with Defendants LSR and Cargill:
Plaintiffs' business plan for the Project was an extremely valuable asset - as conceived, the Project was valued at nearly $1 billion. In order to ensure that the very valuable proprietary business plan for the Project would remain confidential, Peaker and LSR entered into a Non-Disclosure Agreement ("NDA"), entitled "Confidentiality Agreement - Site Business Development," dated August 20, 2013 (herein, "LSR NDA"), which was initially drafted and presented by LSR.
The LSR NDA was intended to protect Plaintiffs from having their prospective business partner, LSR, usurp the Project or Plaintiffs' plans for the Project, and to prevent LSR from sharing with any third parties confidential information relating to the Project. The LSR NDA specifically precluded LSR from any "attempt in any manner to contact or deal with any . . . individuals or companies identified in the confidential information in connection with or related to the project or business plan proposed by the company [Peaker]" and from acting to "by-pass, compete, avoid, circumvent, or attempt to circumvent the company [Peaker] relative to the proposed project . . . ." Thus, the LSR NDA created an obligation in perpetuity on LSR's part not to disclose the plans for the Project or use those plans to arrogate the Project to itself.
After Peaker and LSR executed the LSR NDA, between August 2013 and January 2014, Plaintiffs and LSR engaged in detailed discussions about the Project and conducted numerous meetings with each other to further the Project. [] Between August 2013 and January 2014, on numerous occasions and with LSR's full knowledge and cooperation (and at Plaintiffs' expense), Plaintiffs and their agents, consultants, and/or contracted third parties traveled to the Terminal Site, where they performed activities in support and development of the Project [and explained to LSR their business plan and the contemplated infrastructure changes.] Throughoutthat period, LSR expressed enthusiasm for the Project and reassured Plaintiffs that the Project would go forward once LSR and Plaintiffs finalized the terms of the agreement to effectuate the Project (the "Deal"). Further, on several occasions, LSR stated that it had obtained board approval for the Project and all that remained for the Project to be finalized was to present an agreement acceptable to LSR's Chief Executive Officer and General Manager, Larry Faucheux.
Plaintiffs and LSR worked together to finalize the terms of the Deal, exchanging at least five rounds of term sheets for the Deal between October 20, 2013 and December 9, 2013. LSR's executives represented that they had been working with local community leaders, politicians, and landowners to advance the Project; thus, LSR became deeply involved in the joint effort between Plaintiffs and LSR to bring the Project to fruition. LSR represented to Plaintiffs that it either possessed title, or had options that ensured its ability to acquire title, to adjacent lands that fell within the Project's proposed footprint. Subsequently, Plaintiffs learned that LSR misrepresented its rights to the lands and their title." [Additionally,] Plaintiffs hired engineering firms and coordinated with LSR to plan surveys of the site where the proposed terminal would be located. Plaintiffs [also] provided LSR with a detailed bullet-point summary of the survey requirements and attached sketches for the site that Peaker's rail and engineering teams had prepared.
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While negotiating with LSR, Plaintiffs - expending the combined reputational capital and acquired goodwill that their agents and consultants had built up in the energy industry through many years - worked steadily towards securing the other aspects and requirements of the Project such as acquiring the proper permits and licenses, obtaining financial backing, and soliciting customers. In sum, LSR worked jointly with Plaintiffs towards development and realization of the Project, and throughout that process indicated to Plaintiffs that finalizing the terms of the Dealwould be a mere formality.
Just prior to reaching agreement with LSR on the terms for the deal, Plaintiffs arranged a meeting with Cargill, [which] had been suggested to Plaintiffs as a potential customer for the Project because of Cargill's interest in the energy industry through its Energy, Transportation, Metals division. On or about December 31, 2013, Goitia spoke by telephone with Gaston Garrido, Cargille's ETM business development manager, and presented a highly generalized description of the Project. During that conversation, Goitia mentioned that Cargill was a one-half owner of the LSR site - a fact that Garrido did not know.
On January 2, 2014, Goitia and Garrido met, at which time Goitia made a detailed presentation of the Project. Again, Garrido expressed surprise that Cargill had not heard about the Project before, given Cargill's one-half interest in LSR. At that time, Garrido also disclosed to Goitia that Cargill had been trying unsuccessfullyto develop a project similar to Plaintiffs at the site of another Cargill asset several miles down the Mississippi River from the LSR site. At that January 2, 2014 meeting, Goitia also disclosed to Garrido the existence of the LSR NDA. Upon learning of the LSR NDA, Garrido admitted that Cargill would be bound to work with Plaintiffs on the Project as a result of that document. Cargill also expressed interest in becoming an equity partner in the Project. As the meeting concluded, Garrido indicated that his next step would be to introduce the Project idea to a bigger group within Cargill.
Shortly after leaving the meeting with Cargill, Goitia received a telephone call from Scott MacKenzie ("MacKenzie"), LSR's Business Development Consultant, requesting a meeting, and expressly asking him to come alone. On January 3, 2014, Goitia met with Faucheux and MacKenzie. The principal topic discussed was the Deal. And at that time, Goitia, Faucheux, and MacKenzie reached a verbal agreement on the Deal, which agreement incorporated and built upon the most recent term sheet that they had exchanged. Also at the January 3, 2014 meeting, Goitia told Faucheux and MacKenzie that he had met with representatives of Cargill. MacKenzie mentioned that LSR
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