Turbine Powered Tech. LLC v. Crowe
| Decision Date | 12 August 2019 |
| Docket Number | Civil Action No. 6:19-cv-00475 |
| Parties | Turbine Powered Technology LLC v. Crowe et al |
| Court | U.S. District Court — Western District of Louisiana |
Before the undersigned by referral from the district judge is Plaintiff, Turbine Powered Technology LLC's ("TPT"), Motion to Remand [Rec. Doc. 14], an Opposition Memorandum filed by Defendant David Crowe ("Crowe) [Rec. Doc. 28] and a Reply thereto, filed by TPT [Rec. Doc. 32]. Based on the foregoing, the undersigned recommends that the motion be granted.
The Petition initiating this action was originally filed by TPT on November 7, 2016, in the 16th Judicial District Court for the Parish of St. Mary, State of Louisiana, Docket No. 130379-F ("State Court Case"). The Petition set forth multiple causes of action under Louisiana law including breach of contract, breach of fiduciary duty, tortious interference with a business relationship and violations of the Louisiana Uniform Trade Secrets and Unfair Trade Practices Acts against the named defendants, David Crowe ("Crowe"), Kenneth Braccia ("Braccia"), Kent Ellsworth ("Ellsworth"), AZTT, LLC, AZTT, Inc., all residents of the state of Arizona, Advanced Turbine Services, LLC ("ATS") and Turbine Integrated Power Systems, LLC ("TIPS"), residents of the state of Connecticut, and Donald "Danny" Foley and George Jackson, residents of the state of Louisiana, (collectively referred to as "Defendants"). No claims were alleged under federal statutes or law. R. 18-4.
TPT filed an Application for a Temporary Restraining Order ("TRO") and for Preliminary Injunction with the Petition. Id. The state court granted the TRO against Defendants and conducted a preliminary injunction hearing on January 3, 2017. Affidavits of Long Arm Service on defendants Ellsworth and AZTT, LLC were filed into the record. Affidavits of Long Arm Service in the record on defendants AZTT, Inc., ATS and TIPS indicated these defendants refused Long Arm Service. Also, Crowe was served with the preliminary injunction. While none of the Defendants were present at the hearing, the state court judge held that they were properly served and granted the preliminary injunction on January 5, 2017 against defendants Ellsworth, Braccio, AZTT, LLC, AZTT, Inc., ATS and TIPS.1 R 14-2. The injunction enjoined and enjoins Crowe from, among other things, "[t]he use or conveyance of any and all licenses related to software and/or hardware for industrial turbine controls for T-55 and TF40 engines..." and "[u]sing T-55 and TF40 digital engine controls on the Team Vesco racing project." R. 14-2, at ¶¶ (b) and (q).
While the case was pending in state court, Defendants filed multiple motions contending various exceptions including a motion to dissolve the preliminary injunction. Following a full day of hearings on the motions, the state judge denied some motions and took others, including the Defendants' motion to dissolve the preliminary injunction, under advisement. The court indicated a ruling would issue by July 15, 2017.
On March 13, 2017, Crowe, Braccio, AZTT, Inc. and ATS filed a lawsuit in this Court against TPT, Marine Turbine Technology ("MTT")—TPT's sister company, and Mr. Ted McIntyre, personally, as the owner of both companies. See, Arizona Turbine Technology et al v. Turbine Powered Technology et al, Civil Action No. 6:17-00386. Defendants included claims for defamation under Louisiana law, Louisiana Unfair Trade Practices, defamation and three claims for unfair competition under Arizona law, as well as a claim for conspiracy. Specifically, Defendants alleged that TPT, as the plaintiff in the State Court Case, was defaming them and engaging in other allegedly inappropriate business practices. Id.
On April 10, 2017, ATS filed a Complaint for Damages in this Court against TPT claiming breach of contract, unjust enrichment and detrimental reliance under Louisiana law arising from the same contractual relationship that TPT had sued upon in the State Court Case, Advanced Turbine Services, LLC v. Turbine Powered Technology LLC, Civil Action No. 17-00510. TPT filed a Motion to Consolidate 17- 00510 with 17-00386 based upon commonality of the parties and the claims in the State Court Case. ATS opposed the motion. On July 24, 2017, the Court granted the motion consolidating the cases.
While Defendants were filing the above federal cases in this Court, the State Court Case continued to be litigated. Before the state court issued its ruling on the remaining exceptions and the motion to dissolve the preliminary injunction, on June 22, 2017, Defendants filed a Notice of Removal of the State Court Case to the 16th JDC on the grounds that there was federal question jurisdiction based on patent law as well as diversity jurisdiction. The case was assigned to then District Judge Rebecca F. Doherty as Civil Action No. 17-cv-00801. A week later, on June 29, 2017, Defendants again filed a motion to dissolve the preliminary injunction entered in state court, this time in the federal court case. On July 17, 2017, Judge Doherty denied the motion as premature. TPT filed a Motion to Remand two days later, arguing the case should be remanded for lack of subject matter jurisdiction as the parties were not diverse in citizenship and no questions of federal law pertained to the case. The Motion to Remand was assigned to the undersigned judge for report and recommendation. On July 24, 2017, Defendants filed a Motion to Vacate the State Court Judgment. The Motion to Vacate was set before Judge Doherty.2
Thereafter, on August 17, 2017, Eco-Stim Energy Solutions Inc. ("Eco-Stim"), an oil-field service company, with which Crowe and his companies was associated as a contractor, filed a declaratory judgment lawsuit against McIntyre, TPT, MTT and MTT Properties, LLC, in the Southern District of Texas. See, Eco-Stim Energy Solutions Inc V. McIntyre et al, 4:17-cv-02531. Eco-Stim had been served with a copy of the preliminary injunction against Crowe, AZTT, Inc. and AZTT, LLC. Eco-Stim's lawsuit alleged that it had been wrongly threatened and accused by defendants, McIntyre and TPT, of violating their patent, trade secret and intellectual property rights. In the complaint, Eco-Stim cited testimony from the State Court Case involving the motion to dissolve the injunction as well as the June 22, 2017 removal of Civil Action No. 17-cv-00801. Eco-Stim further cited and quoted the lawsuit in this Court filed by AZTT and Crowe, 17-cv-00386. Throughout the lengthy complaint Eco-Stim's allegations criticized and vilified McIntyre, while supporting the actions of Crowe and AZTT. Ultimately, Eco-Stim complained that McIntyre's actions caused it to suffer inter alia lost profits and lost business opportunities.
On February 27, 2018, U.S. District Judge Nancy Atlas, Southern District of Texas, transferred Eco-Stim, 4:17-cv-02531, to this Court stating that the Texas lawsuit involved claims that "substantially overlap with the Louisiana cases" and therefore the lawsuit should be decided by the Louisiana court. Judge Atlas further considered the defendants' motion to stay the case in favor of related first-filed cases in Louisiana. Judge Atlas agreed and ordered that the case should be stayed or consolidated into the already consolidated cases Civil Action Nos. 17-cv-00386 and 17-cv-00510. Upon transfer, the case became Civil Action No. 18-cv-00249 in this Court. On August 16, 2018, the case was stayed and administratively closed pending adjudication of the State Court Case.
On February 9, 2018, before Judge Atlas transferred the Texas lawsuit, Defendants filed an "Emergency Motion to Reassign Case and Dissolve Preliminary Injunction" in Civil Action No. 17-00801, demanding, "If the Court does not act on Defendants' Emergency Motion by [February 23, 2019], Defendants will consider the Emergency Motion denied and will seek immediate relief before the appropriate Federal Court of Appeals."
Five days later, on February 14, 2018, the Court completed and issued its 24 page Report and Recommendation recommending that the case be remanded to the 16th JDC. On February 22, 2018, Judge Drell issued an order denying the Emergency Motion to Dissolve the Preliminary Injunction as premature for the reasons set forth in the July 17, 2017 ruling by Judge Doherty. In his order, Judge Drell addressed "the threatening pleadings filed by the attorneys in the motion." Specifically, Judge Drell stated that counsel "'threatened' this Court to seek a spurious appeal after counsel frivolously and improperly 'deemed' a non-ruling by the Court on a specific date as a denial of the motion on its merits."3 The following day, February 23, 2018, Judge Drell adopted the Report and Recommendation remanding the case.
Once the State Court Case was remanded, on March 2, 2018, the state judge issued a Judgment on the various rules to show cause that had previously been heard in June, 2017. On April 2, 2018, the state court issued its reasons for having previously denied Defendants' Motion to Dissolve the Preliminary Injunction and entered a written Judgment so holding. Defendants sought writs to the First Circuit Court of Appeal, which remain pending. R. 14-1, p. 13.
TPT moved for contempt against Defendants contending they were continuing to do business in violation of the court's preliminary injunction. The state judge conducted a hearing and on April 9, 2018 granted the Motion for Contempt, reserving damages for a future hearing.
Before the State Court Case was remanded the court issued several orders related to TPT's motions related to Defendants' failure to respond to discovery requests. On February 12, 2019, TPT again filed a Motion for Contempt against Crow and Braccio, AZTT, Inc., AZTT, LLC and ATS for failure to comply with the court's order mandating discovery. After a March 6, 2019 hearing, on March 22, 2019, the court...
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