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Reel Pipe, LLC v. USA Comserv, Inc.

United States District Court, E.D. Louisiana

January 8, 2019


         SECTION "L" (5)



         Before the Court is a 12(b)(6) motion to dismiss filed by Reel Pipe, LLC and C-Logistics, LLC. R. Doc. 20. USA Comserv, Inc. opposes. R. Doc. 23. Having considered the parties' briefs and the applicable law, the Court now issues this Order and Reasons.

         I. BACKGROUND

         This dispute arises out of a time charter between Reel Pipe, LLC (“Reel Pipe”) and USA Comserv, Inc. (“USA Comserv”). In September 2017, USA Comserv chartered Reel Pipe's vessel, the M/V CAROL CHOUEST (the “Vessel”) to transport 850, 000 gallons of fuel to Puerto Rico. Under the terms of the Charter, USA Comserv was to pay (1) charter hire to Reel Pipe at a rate of $20, 000 per day, (2) $1, 200 per day for C-Logistics LLC, an affiliate of Reel Pipe, to coordinate the receiving, loading, and manifesting of all equipment, and (3) certain other defined expenses. If Reel Pipe paid for any of the expenses designated for USA Comserv's account, USA Comserv was obligated to reimburse Reel Pipe at its cost plus 10%.

         The Vessel was delivered to USA Comserv on October 2, 2017 and redelivered to Reel Pipe on October 30, 2017, for a total charter period of 28.17 days. Reel Pipe invoiced USA Comserv for a total of $303, 008.33 for daily charter hire and other costs and expenses under the Charter, but has not been paid. Accordingly, Reel Pipe sued USA Comserv for breach of the Charter and under Louisiana's Open Account statute.

         In answer, USA Comserv asserts counterclaims against Reel Pipe and third-party claims against C-Logistics, LLC (“C-Logistics”). USA Comserv alleges that Reel Pipe breached the Charter by delivering a vessel that was unfit for its intended voyage and by failing to obtain necessary certifications and regulatory permitting. Specifically, USA Comesrv claims that Reel Pipe represented that the Vessel could transport the required 850, 000 gallons of fuel by storing additional fuel in its liquid mud tanks - which required Coast Guard approval. According to USA Comserv, Reel Pipe and C-Logistics indicated that the Vessel's liquid mud tanks had already been inspected and would easily obtain approval, and that the Coast Guard permitting was merely a formality.

         Reel Pipe and C-Logistics never secured Coast Guard approval to transport the fuel in the Vessel's liquid mud tanks, limiting the amount of fuel that could be transported to Puerto Rico. Additionally, USA Comserv was not allowed to offload any fuel upon arrival in Puerto Rico because the Vessel lacked the required certificates, and the fuel was sold offshore at a loss. USA Comserv later learned that (1) Reel Pipe did not apply for authorization to carry fuel in the Vessel's liquid mud tanks until after the Vessel returned from Puerto Rico, and (2) the Vessel's liquid mud tanks did not meet the Coast Guard's requirements and in fact never would have been approved to carry fuel.

         USA Comserv further alleges that it entered into a separate agency agreement with C-Logistics, in which C-Logistics agreed to coordinate all logistics and related services under the Charter. USA Comserv claims that C-Logistics failed to perform these duties and, as a result, Reel Pipe has attempted to double bill USA Comserv - once through its affiliate C-Logistics for the $1, 200 per day logistics fee, and again by seeking an additional 10% surcharge on services that should have been performed by C-Logistics. Additionally, USA Comserv avers that C-Logistics owed it a duty to obtain all necessary permits and certificates for the Vessel's voyage to Puerto Rico and for unloading and discharging fuel in Puerto Rico. Finally, USA Comserv alleges that as its agent, C-Logistics owed it a duty to use commercially reasonable efforts to contract with suppliers of goods and services at competitive market rates, but instead engaged in self-dealing and contracted with affiliates of Reel Pipe and C-Logistics at rates that were higher than other non-affiliated suppliers.

         Accordingly, USA Comserv brings claims against Reel Pipe and C-Logistics for breach of contract (Counts 1 and 5), recognition of its maritime lien on the Vessel (Count 2), negligent misrepresentation (Count 3), violation of the Louisiana Unfair Trade Practices Act (Count 6) and unjust enrichment (Count 7).[1] Reel Pipe and C-Logistics now move to dismiss Counts 2, 5, 6, and 7 under Federal Rule of Civil Procedure 12(b)(6).


         The Federal Rules of Civil Procedure permit a defendant to seek a dismissal of a complaint based on the “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). A complaint should not be dismissed for failure to state a claim “unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” Conley v. Gibson, 355 U.S. 41, 47 (1957).

         “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. The district court must construe facts in the light most favorable to the nonmoving party and must accept as true all factual allegations contained in the complaint. Iqbal, 556 U.S. at 678. A court “do[es] not accept as true conclusory allegations, unwarranted factual inferences, or legal conclusions.” Plotkin v. IP Axess Inc., 407 F.3d 690, 696 (5th Cir. 2005).

         Reel Pipe and C-Logistics move to dismiss Counts 2, 5, 6, and 7. The ...

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