Recurrent Energy Development Holdings, LLC v. SunEnergy1, LLC
| Decision Date | 07 March 2017 |
| Docket Number | 16 CVS 15107 |
| Citation | 2017 NCBC 18 |
| Court | Superior Court of North Carolina |
| Parties | RECURRENT ENERGY DEVELOPMENT HOLDINGS, LLC, Plaintiff, v. SUNENERGY1, LLC, Defendant. |
Poyner Spruill, LLP, by Cynthia L. Van Horne, Lee A. Spinks, and Sarah L. DiFranco, for Plaintiff.
Robinson, Bradshaw & Hinson, P.A., by John R. Wester Douglas M. Jarrell, and Fitz E. Barringer, for Defendant.
ORDER AND OPINION ON PLAINTIFF'S MOTION FOR PARTIAL JUDGMENT ON THE PLEADINGS AND MOTION TO STRIKE OR DISMISS COUNTERCLAIM
1. THIS MATTER is before the Court on Plaintiff's motion for partial judgment on the pleadings (the "Rule 12(c) Motion") and motion to strike (the "Motion to Strike") or, in the alternative, to dismiss the counterclaim (the "Rule 12(b)(6) Motion") filed on December 29, 2016 as a single motion. The Rule 12(c) Motion Motion to Strike, and Rule 12(b)(6) Motion are collectively referred to herein as the "Motions." For the reasons set forth below, the Court hereby DENIES the Motions.
2. The Court sets forth here only those portions of the procedural history relevant to its determination of the Motions.
3. Plaintiff Recurrent Energy Development Holdings, LLC ("Plaintiff" or "Recurrent") initiated this action by filing its complaint on August 23, 2016. This case was designated as a mandatory complex business case by order of the Chief Justice of the Supreme Court of North Carolina dated August 26, 2016 and assigned to the undersigned by order of Chief Business Court Judge James L. Gale dated August 29, 2016.
4. On September 9, 2016, Plaintiff filed its Amended Complaint ("Complaint"). 5. On November 9, 2016, Defendant SunEnergy1, LLC ("Defendant" or "SunEnergy") filed its answer.
6. On November 30, 2016, Plaintiff filed a motion for partial judgment on the pleadings and brief in support.
7. On December 9, 2016, Defendant filed its first amended answer and counterclaim ("Answer" or "Counterclaim").
8. On December 29, 2016, Plaintiff filed the Motions and a supporting brief seeking judgment on the pleadings as to certain of its claims for relief, and to strike or dismiss the Counterclaim. The Motions have been fully briefed, and the Court held a hearing on the Motions on February 21, 2017. The Motions are now ripe for resolution.
9. The Court does not make findings of fact on a motion for judgment on the pleadings under Rule 12(c) of the North Carolina Rules of Civil Procedure ("Rule(s)"), but only recites the factual allegations of the Answer and the undisputed factual allegations of the Complaint.
10. Recurrent is a Delaware limited liability company ("LLC") with its principal place of business in California. (Am. Compl. ¶ 1 [hereinafter Compl.]; First Am. Answer & Countercl. 10, ¶ 2 [hereinafter Answer].)
11. SunEnergy is a North Carolina LLC with its principal place of business in North Carolina. (Compl. ¶ 2; Answer 2, ¶ 2.)
12. Recurrent and SunEnergy are in the business of developing solar energy projects. (Compl. ¶¶ 1-2; Answer 2, 10.)
13. Recurrent expressed interest in buying, and SunEnergy desired to sell, all of the assets necessary for the development of two solar energy projects in North Carolina (the "Proposed Transaction"), one in Bertie County (the "Aulander Project") and the other in Gates County (the "Haslett Project") (collectively, the "Project(s)"). (Compl. ¶ 3; Answer 2, ¶ 3.)
14. On or about February 11, 2016, Recurrent and SunEnergy executed a Confidential Letter of Intent (the "LOI"). (Compl. ¶ 4; Answer 3, ¶ 4.) The LOI set forth the parties' agreement on certain matters pending consummation of the Proposed Transaction. (Compl. Ex. A, ¶ C [hereinafter LOI].)
15. Under the terms of the LOI, Recurrent had the right to pay $2 million to SunEnergy in connection with each Project to secure a twelve-month exclusivity period during which SunEnergy agreed not to engage in any activity that would effect a disposition of the assets of the Project for which payment had been made (the "Exclusivity Payment"). (LOI ¶ 1.)
16. For each Project, the LOI set forth target development milestones by which SunEnergy was to achieve certain objectives with respect to the Projects (the "TDM"). (LOI ¶ 3.) With respect to both Projects, the TDM required the following:
The Aulander Project TDM additionally required wetlands delineation by April 30, 2016 and an executed option to lease additional land by June 30, 2016. (LOI Annex B.)
(LOI ¶ 3.)
18. Except as specifically provided in paragraph 4 of the LOI, the Exclusivity Payment was non-refundable. (LOI ¶ 4a.) Paragraph 4b of the LOI provided that if SunEnergy "fails to achieve the [TDM] for a Project . . . due to a wetlands issue with such Project, then 100% of the Exclusivity Payment for the applicable Project will be refunded to [Recurrent] within sixty (60) days of the date of [Recurrent]'s written election." (LOI ¶ 4b.)
(LOI ¶ 4c.)
21. As of the date of the LOI, three replacement projects with the same MWac capacity as the Projects were specifically identified and exclusively available to Recurrent in the event that SunEnergy failed to achieve the TDM for either Project (the "Replacement Project(s)"): Moyock Solar, LLC ("Moyock"); Shawboro East Ridge Solar, LLC; and Hobbsville Solar, LLC. (LOI Annex C.)
22. On or about February 11, 2016, Recurrent made a $2 million Exclusivity Payment to SunEnergy for the Aulander Project (the "Aulander Exclusivity Payment") and a $2 million Exclusivity Payment to SunEnergy for the Haslett Project (the "Haslett Exclusivity Payment"). (Compl. ¶ 10; Answer 3, ¶ 10.)
23. According to SunEnergy, "the [Aulander Project] could not proceed at its planned size because of wetlands issues with the project site." (Answer 3, ¶ 11.) A wetlands survey revealed that a percentage of the Aulander Project site was located in an area that would be considered jurisdictional wetlands by the United States Army Corps of Engineers. (Compl. ¶ 12; Answer 3-4, ¶ 12.) Thus, the site was unsuitable for a solar energy facility with the MWac capacity that was planned for the site. (Answer 4, ¶ 12.)
24. SunEnergy alleges that, at some time prior to May 2, 2016, Recurrent "effectively made a written election to proceed" with the Moyock Replacement Project, rather than the Aulander Project. (Answer 4, ¶ 13.)
25. On May 2, 2016, Recurrent gave written notice to SunEnergy demanding a full refund of the Aulander Exclusivity Payment. (Compl. ¶ 14, Ex. B; Answer 4, ¶ 14.)
26. On July 13, 2016, Recurrent gave written notice to SunEnergy asserting that SunEnergy had failed to comply with the LOI by failing to refund the Aulander Exclusivity Payment. (Compl. ¶ 22, Ex. E; Answer 5, ¶ 22.)
27. SunEnergy has not refunded the Aulander Exclusivity Payment. (Compl. ¶ 34; Answer 7, ¶ 34.)
28. SunEnergy could not obtain a special use permit for the Haslett Project because of a moratorium on the issuance of special use permits or construction of solar projects in Gates County. (Answer 4, ¶ 16.)
29. On August 31, 2016, Recurrent gave written notice to SunEnergy asserting that SunEnergy had failed to meet the August 30, 2016 TDM for the Haslett Project and requesting that SunEnergy provide a Replacement Project within one day. (Compl. ¶ 17, Ex. C; Answer 4, ¶ 17.) The Moyock Replacement Project was available to Recurrent as a Replacement Project for the Haslett Project. (Answer 5, ¶ 18.)
30. On September 8, 2016, Recurrent gave written notice to SunEnergy demanding a 37.5% refund of the Haslett Exclusivity Payment. (Compl. ¶ 20, Ex. D; Answer 5, ¶ 20.) Recurrent alleges that the refund was due by November 7, 2016, which was after the Complaint was filed, but SunEnergy denies that allegation. (Compl. ¶ 20; Answer 5, ¶ 20.)
31. In addition to the provisions concerning the Projects, the LOI contained a provision regarding a...
To continue reading
Request your trial