United States District Court, E.D. Louisiana
LOGAN LANDRY, ET AL.
POSIGEN, INC., ET AL.
ORDER AND REASONS
are three pending motions in this case. Defendants filed a
motion to strike certain paragraphs from Plaintiff Logan
Landry's original petition for damages (Rec. Doc. 1-1).
Rec. Doc. 4. Landry timely filed an opposition. Rec. Doc. 14.
Defendants also filed a motion to dismiss Landry's
petition for damages. Rec. Doc. 5. Landry again timely filed
an opposition. Rec. Doc. 13. Landry, along with Plaintiff BLG
Innovative Solutions, LLC, then filed an amended complaint.
Rec. Doc. 12. Defendants filed a motion to dismiss the
amended complaint. Rec. Doc. 29. Plaintiffs Landry and BLG
filed an opposition. Rec. Doc. 33. Defendants then sought,
and were granted, leave to file a reply. Rec. Doc. 38.
reasons discussed below, IT IS ORDERED that
Defendants' motion to dismiss the amended complaint (Rec.
Doc. 29) is GRANTED IN PART and
DENIED IN PART.
IS FURTHER ORDERED that Defendants' motion to
dismiss the petition for damages (Rec. Doc. 5) is
DISMISSED AS MOOT.
IS FURTHER ORDERED that Defendants' motion to
strike (Rec. Doc. 4) is GRANTED IN PART and
DENIED IN PART.
BACKGROUND AND PROCEDURAL HISTORY
case stems from a dispute between Plaintiff Logan Landry and
Defendant PosiGen over whether PosiGen violated Landry's
employment contract by failing to pay bonuses, award stock
options, and allow Landry to work out of a satellite office.
See Rec. Doc. 12 ¶¶ 45-70, 84-105. But
Plaintiffs Landry and BLG Innovative Solutions, LLC claim
that this is not just an employment dispute. Plaintiffs have
also brought federal Racketeer Influenced and Corrupt
Organizations (RICO) claims, alleging that the violations of
Landry's employment contract are one part of a larger
scheme to defraud that is currently being carried out by
Defendant Thomas Neyhart, a PosiGen executive and partial
owner. See Id. ¶¶ 14-70.
is a solar energy company. See Id. ¶ 14. It
purchases equipment that produces solar energy, leases that
equipment to residential customers, and installs the
equipment at customers' homes. See Id.
¶¶ 14, 17. This work sometimes requires a
contractor's license, which Neyhart obtained in 2011 for
Green Grants, a predecessor to PosiGen. See Id.
¶ 20. The license application asked whether any
principal of the applicant had been convicted of a crime.
See Id. ¶ 21. Neyhart was a principal of Green
Grants and had previously pled guilty to battery, but Neyhart
did not disclose this information on the application. See
Id. ¶¶ 19, 21. Neyhart submitted the
application by mail. See Id. ¶ 22.
has multiple streams of income. See Id. ¶¶
17, 25-26. Customers who lease solar equipment make monthly
payments to PosiGen. See Id. ¶ 17. PosiGen also
obtains tax credits from federal and state government
programs created to encourage solar energy production.
See Id. ¶¶ 25-26. The tax credits are paid
per completed installation of solar equipment. See
Id. ¶ 27. To receive the credit, applicants must
submit a packet of information to the relevant tax authority
for each completed installation. See id.
in 2012, and continuing today, Neyhart allegedly caused
PosiGen to submit tax credit applications for some
installations that were still in progress and others that
were never completed. See Id. ¶¶ 31-36.
Plaintiffs also allege that Song Yi, PosiGen's CFO, knew
of Neyhart's scheme and aided Neyhart in submitting the
fraudulent applications. See Id. ¶¶ 31,
81. On average, PosiGen schedules 150 installations per month
and, according to the complaint, Neyhart normally caused
PosiGen to prematurely submit tax credit applications for 75
to 80 of those scheduled installations. See Id.
¶¶ 30, 34. To hide the fact that PosiGen is
submitting tax credit applications for more installations
than it actually completes, Neyhart purportedly causes
PosiGen employees to conceal excess inventory and manipulate
inventory records. See Id. ¶ 42.
2014, Neyhart approached Landry about purchasing BLG's
assets, including BLG's customer list. See Id.
¶¶ 47, 49. PosiGen and BLG were business
competitors and Landry was a majority owner of BLG. See
Id. ¶¶ 45, 46. Landry and Neyhart reached a
deal, through negotiations over the phone and by mail, in
which BLG would sell its assets to PosiGen, and PosiGen would
pay BLG cash and hire Landry. See Id. ¶¶
51-52, 56-57, 62. Landry agreed to sell BLG's assets for
a below-market cash price in exchange for more generous
compensation while employed at PosiGen, including annual
bonuses, stock options, and the opportunity to work out of an
office near his home. See Id. Neyhart allegedly did
not intend to honor these generous compensation terms when he
agreed to purchase BLG's assets for a below-market price.
See Id. ¶ 65. PosiGen ultimately failed to pay
annual bonuses, award stock options, or allow Landry to work
from an office near his home. See Id. ¶¶
resigned from PosiGen in August 2016 and filed the instant
lawsuit in August 2017. Id. ¶ 70. The lawsuit
asserts two federal RICO claims against Neyhart and various
state law claims against Neyhart and PosiGen. See
Rec. Doc. 12. After Landry initiated the lawsuit, PosiGen
repeatedly contacted Landry and Landry's current employer
to urge Landry to stop the instant legal proceedings. See
Id. ¶¶ 117-126. Counsel for Neyhart also
contacted Landry's current employer with similar
requests. See Id. ¶ 127.
Motion to dismiss
survive a motion to dismiss under Federal Rule of Civil
Procedure 12(b)(6), a plaintiff's complaint “must
contain ‘enough facts to state a claim to relief that
is plausible on its face.'”Varela v. Gonzalez,
773 F.3d 704, 707 (5th Cir. 2014) (quoting Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). When
deciding whether a plaintiff has met his burden, a court
“accept[s] all well-pleaded factual allegations as true
and interpret[s] the complaint in the light most favorable to
the plaintiff, but ‘[t]hreadbare recitals of the
elements of a cause of action, supported by mere conclusory
statements' cannot establish facial plausibility.”
Snow Ingredients, Inc. v. SnoWizard, Inc., 833 F.3d
512, 520 (5th Cir. 2016)(quoting Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009))(some internal citations and
quotation marks omitted).
Federal Law Claims
law prohibits “any person employed by or associated
with any enterprise engaged in . . . interstate . . .
commerce, to conduct or participate, directly or indirectly,
in the conduct of such enterprise's affairs through a
pattern of racketeering activity . . . .” 18 U.S.C.
§ 1962(c). It also makes it “unlawful for any
person to conspire to” commit a RICO violation.
Id. § 1962(d). The law creates a private civil
remedy to aid enforcement. “Any person injured in his
business or property by reason of a [RICO] violation . . .
may sue therefor . . . and shall recover threefold the
damages he sustains and the cost of the suit, including a
reasonable attorney's fee . . . .” Id.
§ 1964(c). Plaintiffs allege that Neyhart (1) violated
18 U.S.C. § 1962(c) by using his position as ...