United States District Court, M.D. Louisiana
WASHINGTON-ST. TAMMANY ELECTRIC COOPERATIVE, INC., ET AL.
LOUISIANA GENERATING, L.L.C.
RICHARD L. BOURGEOIS, JR. UNITED STATES MAGISTRATE JUDGE
the Court is Defendant's Rule 12(e) Motion for More
Definite Statement (R. Doc. 14) filed on September 18, 2017.
The motion is opposed. (R. Doc. 22). Defendant has filed a
Reply. (R. Doc. 26).
28, 2017, Washington-St. Tammany Electric Cooperative, Inc.
(“Washington-St. Tammany”) and Claiborne Electric
Cooperative, Inc. (“Claiborne”) (collectively,
“Plaintiffs”), filed this breach of contract
action against Louisiana Generating, L.L.C.
(“Defendant”). (R. Doc. 1, “Compl.”).
Plaintiffs allege that they are non-profit electric
cooperative corporations who obtain electric power from
Defendant. (Compl. ¶¶ 1-4). Plaintiffs seek a
finding that Defendant breached certain Power Supply and
Service Agreements (“Contracts”) by charging them
for costs associated with Defendant's remediation of
environmental conditions existing at the Big Cajun II power
generating plant before the execution of the Contracts, as
well as a declaration that Defendant may not assess such
costs in the future. (Compl. ¶¶ 4-5). Plaintiffs
assert that in light of certain Environmental Law Clauses in
the Contracts, Defendant “has exclusive responsibility
for the costs of complying with Environmental Laws existing
prior to June 24, 2002, and also the costs of remediating
environmental conditions that existed at the Big Cajun II
power generating plant prior to June 24, 2002.” (Compl.
assert that Defendant has improperly assessed Plaintiffs with
certain remediation costs incurred pursuant to a Consent
Decree between Defendant and the Environmental Protection
Agency (“EPA”) and Louisiana Department of
Environmental Quality. (Compl. ¶¶ 11-22). The
federal action in which the Consent Decree was entered was
brought by the EPA against Defendant on February 18, 2009
“pursuant to Sections 113(b) and 167 of the Clean Air
Act (‘the Act'), 42 U.S.C. § 7413(b) and 7477,
for injunctive relief and the assessment of civil penalties
for violations of the Prevention of Significant Deterioration
(‘PSD') provisions of the Act, 42 U.S.C.
§§ 7470-92; the federally approved Louisiana PSD
regulations of the Louisiana State Implementation Plan
(“SIP”); Title V of the Act, 42 U.S.C.
§§ 7661-7661f, and the federally approved Louisiana
Title V program, or any rule or permit issued
thereunder.” EPA v. Louisiana Generating,
Civil Action No. 09-100-JJB-RLB, ECF No. 1 at 1 (M.D. La.
Feb. 18, 2009). On March 5, 2013, the Court entered a
Consent Decree providing, in pertinent part, the following:
WHEREAS, the Settling Defendant affirms that a portion of the
emissions technology, including related to PM emissions and
refueling, under this consent decree, will allow it to comply
with the Mercury [and] Air Toxics Rule, a change in
environmental law promulgated after the filing of the
Louisiana Generating, ECF No. 427 at
Plaintiffs allege that in light of the foregoing whereas
clause, Defendant has wrongly characterized remediation costs
of past excess emissions of nitrous oxides
(“NOx”), sulfur dioxide (“SO2”), and
particulate matter (“PM”) as related to the 2011
Mercury and Air Toxics Standards (“MATS”) Rule,
which was proposed by the EPA on May 3, 2011, and became
effective on April 16, 2012, as opposed to environmental laws
in effect prior to the execution of the Contracts.
(see Compl. ¶¶ 21-31).
specifically contend that the following five categories of
costs have been wrongly assessed by Defendant: (i) the boiler
conversion of Unit 2 at Defendant's Big Cajun II power
plan from coal to natural gas (including natural gas pipeline
costs); (ii) the installation of PM continuous emission
monitoring systems (“CEMS”) on Units 1 and 3;
(iii) “certain costs” associated with the ash
handling collection systems; (iv) “certain costs”
of electrostatic precipitator (“ESP”) upgrades;
and (v) “certain costs” that Defendant has
identified as MATS chemical costs. (Compl. ¶¶ 27,
30, 34, 37).
assert that Defendant has wrongly assessed Plaintiffs with
approximately $38.1 million between 2016 and 2025 in
remediation costs. (Compl. ¶ 28). Plaintiffs allege that
“[o]f the approximately $38.1 million in costs that
[they] dispute, approximately $10.4 million are capital
costs, approximately $16.2 million are interest expenses, and
approximately $11.5 million are operations and maintenance
expenses.” (Compl. ¶ 28). Plaintiffs challenge
Defendant's position that it “has appropriately
allocated chemical costs between the Activated Carbon
Injection system (a mercury control) and the dry sorbent
injection (“DSI”) and SNCR [Selective
Non-Catalytic Reduction system] required by the Consent
Decree.” (Compl. ¶ 29). Plaintiffs assert that
they have “already suffered significant harm, paying
more than $7.6 million in unjustified charges from July 2015
through May 2017.” (Compl. ¶ 31).
September 18, 2017, Defendant filed the instant Motion for a
More Definite Statement under Fed.R.Civ.P. 12(e). (R. Doc.
14). Defendant contends that the Complaint “fails to
provide any information regarding the disputed ash handling
collection systems costs, little to no information regarding
the disputed ESP costs, and little information regarding the
disputed chemical costs.” (R. Doc. 14 at 3). Defendant
argues that because Plaintiffs have not specifically
identified the “certain costs” related to these
three categories, it cannot prepare a response to the
allegations regarding those costs. (R. Doc. 14-1 at 5-7).
opposition, Plaintiffs contend that they have satisfied the
pleading requirements of Rule 8(a)(2), and that the
specificity sought by Defendant is more appropriately
addressed through discovery. (R. Doc. 22). Plaintiffs assert
that they have specifically pled that the “certain
costs” alleged in the Complaint are those costs
associated with Defendant's “implementation of its
remediation obligations in the Consent Decree or other
Environmental Laws enacted before 2002, and not the MATS
Rule.” (R. Doc. 22 at 4; Compl. ¶ 30). In short,
Plaintiffs assert that the only challenged costs are those
that Defendant has mischaracterized as costs incurred to
comply with the MATS Rule, and that discovery is required to
identify which costs have been mischaracterized. (R. Doc. 22
at 4-5). Plaintiffs further assert that in November 2016
(prior to commencing the instant action), they attempted to
obtain more information regarding Defendant's cost
calculations and that Defendant responded that the
information sought is confidential. (R. Doc. 22 at 5-6).
reply, Defendant represents that it attempted to provide
Plaintiffs with information about the allocation of costs
towards MATS Rule compliance as early as January of 2016, but
Plaintiffs refused to sign a confidentiality agreement to
obtain the information sought until they filed the instant
action. (R. Doc. 26 at 2-3, 4-6). Defendant again asserts
that Plaintiffs have not identified the specific costs at
issue regarding the ash handling collection systems, ESP
upgrades, and chemical costs. (R. Doc. 26 at 3-5).
Law and Analysis
12(e) provides that “a party may move for a more
definite statement of a pleading to which a responsive
pleading is allowed but which is so vague or ambiguous that
the party cannot reasonably prepare a response.”
Fed.R.Civ.P. 12(e); see also Beanel v. Freeport-McCoran,
Inc., 197 F.3d 161, 164 (5th Cir. 1999) (“If a
complaint is ambiguous or does not contain sufficient
information to allow a responsive pleading to be framed, the
proper remedy is a motion for a more definite statement under
Rule 12(e)”). The complaint must “give the
defendant fair notice of what the plaintiff's claim is
and the grounds upon which it rests.” Swierkiewicz
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