United States District Court, E.D. Louisiana
ADDY'S BURGER, L.L.C.
PARADIGM INVESTMENT GROUP, LLC
ORDER AND REASONS
MICHAEL B. NORTH UNITED STATES MAGISTRATE JUDGE
RELEVANT FACTS AND PROCEDURAL BACKGROUND
lawsuit arises out of an alleged breach of a lease agreement
between Plaintiff, Addy's Burger, LLC (“Addy's
Burger”) and its tenant, Paradigm Investment Group, LLC
(“Paradigm”), which is said to have occurred
after the sale of the property and the assignment of the
lease by the original lessor, Chalmette Burgers, LLC
March 15, 2013, Paradigm and Chalmette Burgers executed a
Lease Agreement (the “Lease”) for property
located at 8400 West Judge Perez Dr., Chalmette, LA 70043
(the “Property”). (Rec. doc. 1). Pursuant to the
Lease, Paradigm would operate a Hardee's restaurant on
the Property. Section 5.02 of the Lease contains an indemnity
clause that provides, in pertinent part:
INDEMNITY: TENANT will indemnify, defend, and hold harmless
LANDLORD . . . from any and all damages, losses, liabilities,
obligations, penalties, claims, litigation, demands,
defenses, judgments, suits, proceedings, costs, disbursements
or expenses of any kind or nature whatsoever (including,
without limitation, reasonable attorneys' fees and
experts' fees and disbursements) (collectively, the
“Liabilities”) arising from . . . (iv) any
misrepresentation or breach of warranty by TENANT under this
(Rec. doc. 1-1).
2015 Chalmette Burgers decided to sell the Property and
eventually did sell it to Addy's Burger. As part of the
sale of the Property, on March 2, 2016, Chalmette Burgers and
Addy's Burger executed an Assignment and Assumption of
the Lease (the “Assignment”). (Rec. doc. 1-2).
The Effective Date of the Assignment was March 2, 2016.
(Id.). The Assignment provides, in pertinent part:
1. Assignment. As of the Effective Date, Assignor
hereby assigns, conveys, transfers and sets over unto
Assignee all of Assignor's right, title and interest in,
to and under the Lease, including, without limitation, the
Guaranty, if any, and all of Assignor's right, title and
interest in and to security, cleaning or other deposits and
in and to any claims for rent, arrears rent or any other
claims arising under the Lease against any lessee thereunder,
subject to the rights of the lessees under the Lease.
2. Assumption. Assignee hereby assumes and agrees to
pay all sums, and perform, fulfill and comply with all
covenants and obligations, which are to be paid, performed,
fulfilled and complied with by the lessor under the Lease,
from and after the Effective Date.
after the Assignment and sale of the Property from Chalmette
Burgers to Addy's Burger, Paradigm informed Addy's
Burger that it would not be able to make its rental payments
under the Lease and it vacated the Property. On March 23,
2017, Addy's Burger filed the instant lawsuit against
Paradigm, seeking damages from Paradigm for its alleged
breach of the Lease.
thereafter, on March 29, 2017, Addy's Burger filed suit
against Chalmette Burgers in the Civil District Court for the
Parish of Orleans, seeking damages and rescission of the sale
of the Property. On October 5, 2017, Addy's Burger filed
its Second Amended and Supplemental Complaint in this Court,
adding as defendants Chalmette Burgers; its principal, Paul
Dorsey; and Capital Pacific Real Estate Brokerage Company,
the real estate brokerage company hired by Chalmette Burgers
to sell the Property. (Rec. doc. 28).
March 14, 2018, the Court granted Paradigm's motion for
leave to file a crossclaim against Addy's Burger and a
counterclaim against Chalmette Burgers. (Rec. docs. 67-69).
Chalmette Burgers responded by filing its own crossclaim
against Paradigm, seeking defense and indemnity under the
Lease vis-à-vis Addy's Burger's claim against
it, to wit:
Under the clear language of section 5.01 of the Lease,
Paradigm owes Chalmette Burgers indemnity and defense to the
claims brought by Addy's Burger. Accordingly, Chalmette
Burgers seeks enforcement of the terms and provisions of the
Lease by way of an award of its attorneys' fees and costs
incurred to defend the underlying Action by Plaintiff,
Addy's Burger, as well as indemnity for any and ...