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Landry v. Posigen, Inc.

United States District Court, E.D. Louisiana

March 8, 2019

LOGAN LANDRY
v.
POSIGEN, INC. ET AL

         SECTION "B"(5)

          ORDER AND REASONS

         Defendants Posigen, Inc. et al filed a motion for partial summary judgment on damages. Rec. Doc. 95. Plaintiffs filed a response in opposition, and a second response in opposition upon the Court's continuance of the submission deadline. Rec. Doc. 159, Rec. Docs. 186. Defendants sought, and were granted, leave to file a reply. Rec. Doc. 180.

         For the reasons discussed below, IT IS ORDERED that defendants' motion for partial summary judgment on damages is GRANTED in part and DENIED in part.

         FACTUAL BACKGROUND AND PROCEDURAL HISTORY

         This case arises from an employment contract dispute between plaintiff Logan Landry and defendants PosiGen Inc, et al over whether defendants PosiGen violated plaintiff Landry's employment contract by failing to pay him bonuses, award stock options, and forcing him to commute to New Orleans for work. In their amended complaint, plaintiffs bring federal Racketeer Influenced and Corrupt Organizations (RICO) claims against defendants, alleging that defendant Thomas Neyhart, owner, president, and director of PosiGen of Louisiana LLC, has been running a number of fraud schemes involving submitting false tax credit requests to the federal government, fraudulently inducing BLG to sell its customer lists and assets to PosiGen La, and forcing Landry to participate in the tax credit fraud scheme. Rec. Doc. 12. The facts of defendants' alleged scheme are laid out in greater detail in an earlier Order and Reasons issued by this Court and are incorporated by reference here. Rec. Doc. 54.

         This Court previously granted in part and denied in part defendants' motion to dismiss the amended complaint. Rec. Doc. 29. Among other things, this Court held that plaintiffs could not base their breach of contract claim on unpaid bonuses as Landry's written employment contract did not obligate defendants to pay him bonuses. Rec. Doc. 54 at 17.

         Defendants filed the instant motion for partial summary judgment on damages, arguing that plaintiffs were not entitled to recover certain categories of damages sought in their complaint. Specifically, defendants assert that the following categories of damages sought by plaintiffs should be denied: 1) over $4 million for the value of BLG assets lost when plaintiffs were fraudulently induced by Neyhart to sell BLG's assets to PosiGen LA for $244, 975.05; 2) approximately $120, 000 for the amount in stock options/bonuses that PosiGen LA never paid to Landry as part of the fraudulently induced agreements that plaintiffs entered into; 3) $16, 000 or the equivalent of enough Delta Sky Miles to cover the average mileage cost of (2) first class tickets, or 200, 000 miles; 4) severe emotional distress caused by having to commute from Houma, Louisiana to New Orleans, Louisiana for work; and 5) attorney's fees. Rec. Doc. 95 at 2. In support of their motion, Defendants argue that plaintiffs have no evidence to prove that BLG's assets were worth more than what PosiGen paid for them and that BLG and PosiGen LA have already settled all disputes relating to the value of the assets. Id. Defendants also assert that plaintiffs are not entitled to recover unpaid bonuses, attorney's fees, or emotional distress damages as a matter of law. Id. at 2-3. Finally, defendants aver that plaintiffs do not have a legal basis to recover the value of any Delta Sky Miles. Id. at 2.

         Plaintiffs oppose defendants' motion for summary judgment, asserting that there is sufficient evidence in the record to demonstrate that genuinely disputed material facts exist as to whether defendants paid less than fair market value for BLG's assets. Rec. Doc. 186 at 9-12. Plaintiffs also assert that they are entitled to recover the value of unpaid bonuses, unpaid Delta Sky Miles, attorney's fees and non-pecuniary damages such as for emotional distress or mental anguish. Id. at 12-21.

         THE PARTIES' CONTENTIONS

         Defendants seek summary judgment declaring that plaintiffs are not entitled to recover the following categories of damages: 1) the value of BLG assets plaintiffs allege they lost when the assets were allegedly sold below market value to PosiGen La; 2) the value of bonuses that plaintiffs allege PosiGen La did not pay to plaintiffs; 3) the value of Delta Sky Miles plaintiffs allege they are owed; 4) damages for emotional distress; and 5) attorney's fees for plaintiff's breach of contract or detrimental reliance claims. Rec. Doc. 95 at 2.

         First, defendants assert that plaintiffs are not entitled to recover damages relating to the alleged underpayment of BLG's assets because plaintiffs have no evidence to prove that the amount PosiGen paid for BLG's assets was below market value. Rec. Doc. 95-1 at 3. Defendants state that plaintiffs have not specified the amount by which PosiGen allegedly underpaid for any particular asset and the expert report provided by plaintiffs is not relevant to this question as it does not provide a valuation of BLG's assets. Rec. Docs. 85-1 at 4, 180 at 2. Additionally, defendants state that BLG and PosiGen La have already agreed to settle all claims relating to the Asset Purchase Agreement (APA), and that plaintiffs are barred from seeking to recover money for the assets as they have not sought to set aside either the APA or the Settlement Agreement. Rec. Doc. 95-1 at 5.

         Second, defendants argue that plaintiffs are not entitled to recover any amount for unpaid bonuses as a matter of law because of this Court's Order and Reasons dismissing plaintiffs' claim for unpaid bonuses. Id. Defendants state that because this Court has already determined that defendants were not contractually obligated to pay Landry bonuses, it should now declare that plaintiffs are not entitled to recover the amount of any allegedly unpaid bonuses as a matter of law. Id. at 6.

         Third, defendants argue that plaintiffs do not have a legal claim for recovery of the value of any Delta Sky Miles because the Amended Complaint states that defendants never confirmed an arrangement to provide Landry with the miles and therefore no defendant was obliged to give him any Delta Sky Miles. Id.

         Fourth, defendants assert that plaintiffs are not entitled to recover attorneys' fees because a plaintiff is not legally entitled to attorney's fees for breach of contract and detrimental reliance claims unless they are provided by the contract or a statute. Id. at 7. Because Landry's employment agreement with PosiGen La does not provide for him to recovery attorney's fees and there is no statutory basis for the recovery of attorney's fees, ...


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