explaining that “[w]hat offends the [LUTPA] statute in [many employer-employee] cases is the breach of a special relationship of trust between the employer and employee”
How later courts described this case
- explaining that “[w]hat offends the [LUTPA] statute in [many employer-employee] cases is the breach of a special relationship of trust between the employer and employee”
Written by the judges who cited it.
The opinion
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
HOSPITAL HOUSEKEEPING CIVIL ACTION
SYSTEMS, LLC
VERSUS No. 23-1309
JOHN CALVEY ET AL. SECTION I
ORDER & REASONS
Before the Court is plaintiff Hospital Housekeeping Systems, LLC’s
(“plaintiff”) motion1 to review the U.S. Magistrate Judge’s (“magistrate judge”) order2
denying plaintiff’s motion3 for leave to file a second amended complaint. Defendants
John Calvey (“Calvey”) and Ochsner Clinic Foundation (“Ochsner”) (collectively,
“defendants”) oppose4 the motion. For the reasons that follow, the Court affirms the
magistrate judge’s order in part and reverses it in part.
I. FACTUAL BACKGROUND
Plaintiff filed its initial complaint on April 19, 2023.5 On April 20, 2023,
plaintiff filed an ex parte motion for leave to file an amended complaint.6 This Court
granted7 the motion, and the amended complaint was filed into the record.8 As
amended, the complaint alleges that, on August 1, 2015, plaintiff and Ochsner
1 R. Doc. No. 52.
2 R. Doc. No. 48.
3 R. Doc. No. 31.
4 R. Doc. No. 54.
5 R. Doc. No. 1.
6 R. Doc. No. 3.
7 R. Doc. No. 4.
8 R. Doc. No. 5.
entered into a contract pursuant to which “[plaintiff] would provide and manage the
facilitation of housekeeping services at multiple Ochsner . . . facilities.”9 The contract
allegedly contained a non-solicitation provision prohibiting Ochsner and plaintiff
from soliciting each other’s employees “for a period beginning at the start of the
[c]ontract to twelve . . . months after the termination of the [c]ontract.”10
The first amended complaint further alleges that Calvey, the former Director
of Environmental Services for plaintiff, entered an “Agreement Not to Compete” with
plaintiff.11 Pursuant to this agreement, Calvey allegedly agreed that, during his
employment with plaintiff and for a period of two years after, he would not “directly
or indirectly[] solicit the employees of plaintiff to leave the service of plaintiff or solicit
and/or accept the business of any person or business entity for whom plaintiff
rendered services at any time during the employment relationship.”12 Calvey also
allegedly “agreed that he would not disclose any of the information concerning the
business and affairs of [plaintiff]” and “to treat all such information as confidential.”13
According to the first amended complaint, Ochsner informed plaintiff of its
intent to terminate its contract with plaintiff effective August 1, 2021.14 On July 31,
2021, “Calvey’s employment with plaintiff ended.”15 Following Calvey’s departure,
plaintiff “learned that Ochsner employees/management asked plaintiff’s former
9 Id. ¶ 4.
10 Id. ¶ 5.
11 Id. ¶ 13.
12 Id. ¶ 19.
13 Id. ¶ 20.
14 Id. ¶ 8.
15 Id. ¶ 15.
managers to apply for positions at Ochsner.”16 Calvey allegedly began working for
Ochsner in its in-house housekeeping department on August 1, 2021.17 The first
amended complaint asserts claims for breach of an employment contract, breach of a
non-compete agreement, and breach of a non-solicitation agreement.18 It also alleges
that “it is highly probabl[e] that [Calvey] is disclosing plaintiff’s practices, procedures,
methods, and trade secrets to [Ochsner].”19
On October 10, 2023, defendants filed a motion20 to strike or dismiss plaintiff’s
first amended complaint. On October 12, 2023, plaintiff filed an ex parte motion to
enroll new counsel,21 which this Court granted.22 Plaintiff’s new counsel then filed a
motion23 for leave to file a second amended complaint, as well as an ex parte motion24
to continue the submission date on defendants’ motion to strike or dismiss until after
the submission date on plaintiff’s motion for leave to amend. Based on plaintiff’s
argument that the magistrate judge’s decision on plaintiff’s motion for leave to amend
might render defendants’ motion to strike or dismiss moot, the Court granted
plaintiff’s motion to continue.25
16 Id. ¶ 16.
17 Id. ¶ 17.
18 Id. at 1.
19 Id. ¶ 23.
20 R. Doc. No. 25.
21 R. Doc. No. 27.
22 R. Doc. No. 29.
23 R. Doc. No. 31.
24 R. Doc. No. 32.
25 R. Doc. No. 33.
On January 4, 2024, the magistrate judge denied plaintiff’s motion for leave to
amend.26 The magistrate judge held that granting plaintiff leave to file its second
amended complaint would be futile because the second amended complaint fails to
state a claim for breach of a non-solicitation agreement, fails to state a claim pursuant
to the Louisiana Unfair Trade Practice and Consumer Protection Law (“LUTPA”),
fails to state a claim pursuant to the Louisiana Uniform Trade Secrets Act (“LUTSA”),
and fails to state a claim for conversion.27
Following the magistrate judge’s ruling, the Court held a telephone conference
to discuss the status of the case.28 At the conference, plaintiff’s counsel advised the
Court of plaintiff’s intent to appeal the magistrate judge’s decision.29 The Court set a
briefing schedule for plaintiff’s appeal,30 and the parties timely filed the instant
motion and response.
II. STANDARDS OF LAW
a. Review of a Magistrate Judge’s Order
Rule 72 of the Federal Rules of Civil Procedure governs a district court’s review
of a magistrate judge’s decision on a pretrial matter. Rule 72(a) requires a party who
objects to a magistrate judge’s ruling to “serve and file objections to the order within
14 days after being served with a copy.”
26 R. Doc. No. 48.
27 Id. at 9–14.
28 R. Doc. No. 50.
29 Id. at 1.
30 Id.
Rule 72(a) provides that a district judge reviewing an order on a non-
dispositive matter may “modify or set aside any part of the order that is clearly
erroneous or contrary to law.” A motion for leave to amend a complaint is non-
dispositive. PYCA Indus., Inc. v. Harrison Cnty Waste Water Mgmt. Dist., 81 F.3d
1412, 1421 (5th Cir. 1996); see also Dalrymple v. U.S. Postal Serv., 2020 WL 1181845,
at *2 (E.D. La. Mar. 12, 2020) (Vance, J.) (collecting cases). “The district court may
only find the magistrate judge’s ruling clearly erroneous or contrary to law when the
reviewing court is ‘left with the definite and firm conviction that a mistake has been
committed.’” McCallon v. BP Am. Prod. Co., No. 05-0597 c/w 05-0700, 2006 WL
3246886, at *2 (E.D. La. Nov. 8, 2006) (Fallon, J.) (quoting Palacios Seafood, Inc. v.
Piling, Inc., 888 F.2d 1509, 1513 (5th Cir. 1989)). Rule 72(a) further provides that “[a]
party may not assign as error a defect in [a magistrate judge’s non-dispositive order]
not timely objected to.”
b. Leave to File an Amended Complaint
Federal Rule of Civil Procedure 15(a) provides that leave to amend pleadings
“shall be freely given when justice so requires.” Fed. R. Civ. P. 15(a). Although Rule
15 “evinces a bias in favor of granting leave to amend,” it is not automatic. Martin’s
Herend Imps., Inc. v. Diamond & Gem Trading U.S.A. Co., 195 F.3d 765, 770 (5th
Cir. 1999); United States ex rel. Lin v. Mayfield, 773 F. App’x 789, 790 (5th Cir. 2019)
(quotations omitted). A decision to grant leave to amend is within the discretion of
the trial court. Mayfield, 773 F. App’x at 790. However, a “district court must possess
a ‘substantial reason’ to deny a request for leave to amend.” Id. (quoting Smith v.
EMC Corp., 393 F.3d 590, 595 (5th Cir. 2004)). The “futility of the amendment” is one
such reason. Id. “[A]n amended complaint is futile ‘if the complaint as amended would
be subject to dismissal.’” Rohi v. Brewer (In re ABC Dentistry, P.A.), 978 F.3d 323, 325
(5th Cir. 2020) (quoting Varela v. Gonzales, 773 F.3d 704, 707 (5th Cir. 2014)).
Futility is evaluated “under the same standards as a dismissal under Rule 12(b)(6).”
Butler v. Denka Performance Elastomer, L.L.C., 16 F.4th 427, 437 (5th Cir. 2021)
(citing Villarreal v. Wells Fargo Bank, N.A., 814 F.3d 763, 766 (5th Cir. 2016)).
III. ANALYSIS
Plaintiff takes issue with the magistrate judge’s order on three different
grounds. First, plaintiff argues that the magistrate judge “failed to liberally construe
the proposed pleading in favor of plaintiff, as required by law.”31 Second, plaintiff
asserts that the magistrate judge “confused the allegations of the [f]irst [a]mended
[c]omplaint with those of the [s]econd [a]mended [c]omplaint” with respect to
allegations pertaining to the non-compete provision of Calvey’s employment
agreement.32 Third, plaintiff contends that the magistrate judge erroneously “applied
the law concerning the non-solicitation of business clients to this case, which involves
the non-solicitation of employees.”33 Applying Rule 72(a)’s standard, the Court
considers each of these arguments in turn.
31 R. Doc. No. 52-1, at 1.
32 Id. at 1, 4.
33 Id. at 1.
a. Liberal Construction of the Pleadings
As to plaintiff’s first argument, the Court concludes that the magistrate judge
did not clearly err by “fail[ing] to liberally construe the proposed pleading in favor of
plaintiff[.]”34 Plaintiff broadly suggests that the proposed second amended complaint
“alleged sufficient facts to put defendants on notice of plaintiff’s claims[.]”35 However,
the magistrate judge correctly applied the relevant legal standard in considering
whether granting leave to amend would be futile. As stated, courts may deny leave
to amend where the proposed amended complaint would be futile, meaning it would
be subject to dismissal pursuant to Rule 12(b)(6). See, e.g., ABC Dentistry, 978 F.3d
at 325; Butler, 16 F.4th at 437.
To survive a Rule 12(b)(6) 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) (citation and internal
quotations omitted). “[T]he face of the complaint must contain enough factual matter
to raise a reasonable expectation that discovery will reveal evidence of each element
of the plaintiffs’ claim.” Hi-Tech Elec., Inc v. T&B Constr. & Elec. Servs., Inc., No. 15-
3034, 2017 WL 615414, at *2 (E.D. La. Feb. 15, 2017) (Vance, J.) (emphasis added)
(citing Lormand v. US Unwired, Inc., 565 F.3d 228, 255–57 (5th Cir. 2009)). A
complaint is insufficient if it contains “only labels and conclusions, or a formulaic
recitation of the elements of a cause of action.” Whitley v. Hanna, 726 F.3d 631, 638
34 Id. at 1.
35 Id. at 2–3.
(5th Cir. 2013) (citation and internal quotations omitted). “Threadbare recitals of the
elements of a cause of action, supported by mere conclusory statements, do not
suffice.” Iqbal, 556 U.S. at 678 (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544,
555 (2007)).
Plaintiff does not identify any specific instances in the magistrate judge’s order
where the magistrate judge failed to view the complaint “in the light most favorable
to the plaintiff,” “accept[] as true all well-pleaded factual allegations[,]” or “draw[] all
reasonable inferences in the plaintiff’s favor.” Lovick v. Ritemoney Ltd., 378 F.3d 433,
437 (5th Cir. 2004). According to defendants, plaintiff has waived its right to
challenge any issues not specifically addressed in this appeal, including the
magistrate judge’s rulings as to plaintiff’s LUTPA, LUTSA, and conversion claims.36
However, in order to meaningfully evaluate plaintiff’s general argument regarding
the standard applied by the magistrate judge, the Court must consider the magistrate
judge’s analysis of specific claims. Having carefully reviewed the magistrate judge’s
order, the Court finds that the magistrate judge correctly determined that granting
plaintiff leave to amend would be futile with respect to plaintiff’s LUTPA, LUTSA,
and conversion claims.
i. LUTPA
To begin, the Court finds no clear error and nothing contrary to law in the
magistrate judge’s futility determination as to plaintiff’s proposed LUTPA claim.
“LUTPA prohibits ‘[u]nfair methods of competition and unfair or deceptive acts or
36 R. Doc. No. 54, at 2–4.
practices in the conduct of any trade or commerce.’” Matrix HVAC, LLC v. Daikin
Applied Ams., Inc., No. 23-1669, 2023 WL 8701330, at *2 (E.D. La. Dec. 15, 2023)
(Barbier, J.) (quoting La. Rev. Stat. § 51:1405(A)). “Louisiana courts have confined
unfair practices to those which offend established public policy and are immoral,
unethical, oppressive, unscrupulous, or substantially injurious.” D.H. Griffin
Wrecking Co., Inc. v. 1031 Canal Dev., LLC, 463 F. Supp. 3d 713, 722 (E.D. La. 2020)
(Fallon, J.) (cleaned up). “Fraud, misrepresentation, deception, and similar conduct
is prohibited, mere negligence is not.” Id. at 722–23 (quoting Turner v. Purina Mills,
Inc., 989 F.2d 1419, 1422 (5th Cir. 1993)). Further, there is “a great deal of daylight
between a breach of contract claim and the egregious behavior the statute proscribes.”
Id. at 723 (cleaned up).
With respect to plaintiff’s LUTPA claim, the proposed amended complaint
alleges that Calvey converted plaintiff’s “business practices and procedures, and
internal business forms” containing “proprietary and confidential information” to his
own and Ochsner’s use and benefit.37 It further alleges that these business practices,
procedures, and internal business forms remained in Ochsner’s possession “after it
had been represented to [plaintiff] that all such information and documents had been
purged from Ochsner’s records.”38
Viewing these allegations in the light most favorable to plaintiff, the Court
finds nothing in the magistrate judge’s futility determination that amounts to clear
37 R. Doc. No. 31-2, ¶ 17.
38 Id. ¶ 18.
error or that is contrary to law. The magistrate judge correctly held that the proposed
pleading is devoid of any allegations suggesting that defendants’ actions were
sufficiently egregious to constitute a violation of LUTPA, particularly considering
that “cases that have been decided under LUTPA have defined ‘unfair trade practices’
narrowly.” Target Const., Inc. v. Baker Pile Driving & Site Work, L.L.C., No. 12-1820,
2012 WL 5878855, at *5 (E.D. La. Nov. 20, 2012) (Fallon, J.).
As the magistrate judge explained, the proposed pleading in the instant case
does not allege that the business practices and procedures or internal business forms
were “unique to [plaintiff] as opposed to any other similar business.”39 It also does
not allege that Calvey breached any fiduciary duty or ethical standard through his
conduct. Cf. Turner, 989 F.2d at 1422 (explaining that “[w]hat offends the [LUTPA]
statute in [many employer-employee] cases is the breach of a special relationship of
trust between the employer and employee”). At most, the complaint alleges facts
suggesting that Calvey breached his contractual duty to refrain from “using or
disclosing [plaintiff’s] confidential information except as required during the term of
his employment with [plaintiff].”40 As stated, there is “a great deal of daylight
between a breach of contract claim and the egregious behavior the [LUTPA] statute
proscribes.” D.H. Griffin Wrecking Co., 463 F. Supp. 3d at 723. Accordingly, the Court
finds no clear error and nothing contrary to law in the magistrate judge’s
39 R. Doc. No. 48, at 10.
40 R. Doc. No. 31-2, ¶ 16.
determination that plaintiff’s proposed second amended complaint does not state a
plausible LUTPA claim.
ii. LUTSA
The magistrate judge also did not clearly err in finding that the proposed
second amended complaint fails to state a LUTSA claim. To plead a plausible LUTSA
claim, a plaintiff must allege (1) the existence of a trade secret; (2) a misappropriation
of the trade secret by another; and (3) the actual loss caused by the misappropriation.
Matrix HVAC, 2023 WL 8701330, at *2 (citing Comput. Mgmt. Assistance Co. v.
Robert F. DeCastro, Inc., 220 F.3d 396, 403 (5th Cir. 2000)). “To allege a trade secret,
the plaintiff must describe the subject matter of the trade secret with sufficient
particularity to separate it from matters of general knowledge in the trade or of
special persons who are skilled in the trade, and to permit the defendant to ascertain
the boundaries within which the secret lies.” Id. (quoting Am. Biocarbon, LLC v.
Keating, No. 20-259, 2020 WL 7264459, at *4 (M.D. La. Dec. 10, 2020) (internal
quotations omitted)).
The proposed second amended complaint alleges that Calvey violated LUTSA
by “convert[ing] to his own [and Ochsner’s] use and benefit” plaintiff’s “business
practices and procedures, and internal business forms, all of which Ochsner has
employed in the running and management of its own housekeeping service, and
which proprietary and confidential information [p]laintiff entrusted to its former
managers/employees, including [] Calvey.”41 The proposed complaint also alleges that
41 Id. ¶ 17.
plaintiff discovered its “business practices and procedures and internal business
forms” were still in Ochsner’s possession “after it had been represented to plaintiff
that all such information and documents had been purged from Ochsner’s records.”42
Nowhere in the complaint does plaintiff “describe the subject matter of the
trade secret with sufficient particularity to separate it from matters of general
knowledge.” Matrix HVAC, 2023 WL 8701330, at *2. Rather, the complaint refers
vaguely to “business practices and procedures, and internal business forms,” without
specifying the subject matter of the trade secret.43 Accordingly, the magistrate judge
correctly determined that granting leave to amend would be futile with respect to the
LUTSA claim. The Court finds no clear error and nothing contrary to law.
iii. Conversion
Likewise, the magistrate judge’s holding regarding plaintiff’s conversion claim
is neither clearly erroneous nor contrary to law. To state a conversion claim pursuant
to Louisiana law, a plaintiff must allege (1) acquisition of possession in an
unauthorized manner; (2) removal of a chattel from one place to another with the
intent to exercise control over it; (3) unauthorized transfer of possession of a chattel;
(4) withholding possession from the owner; (5) alteration or destruction of the chattel;
(6) improper use of the chattel; or (7) assertion of ownership over the chattel. See
Quality Env’t Processes, Inc. v. IP Petroleum Co., Inc., 219 So. 3d 349, 369 (La. App.
1st Cir. 2017) (citing Dual Drilling Co. v. Mills Equip. Invs., Inc., 72 So. 2d 853, 857
42 Id. ¶ 18.
43 Id. ¶ 17.
(La. 1998)); First Am. Bankcard, Inc. v. Smart Bus. Tech., Inc., 178 F. Supp. 3d 390,
406 (E.D. La. 2016) (Engelhardt, J.). “One of the essential elements of a conversion
claim is deprivation of possession from the owner.” Matrix HVAC, 2023 WL 8701330,
at *5 (citing Quealy v. Paine, Webber, Jackson & Curtis, Inc., 475 So. 2d 756, 760 (La.
1985)).
As the magistrate judge rightly held, the proposed complaint fails to allege that
plaintiff was deprived of possession of anything. Rather, plaintiff appears to claim
that it still maintains possession of the purportedly confidential information, but that
Ochsner also maintains possession of that information. This is insufficient to state a
plausible conversion claim. See Matrix HVAC, 2023 WL 8701330, at *5. Accordingly,
the Court finds no clear error and nothing contrary to law in the magistrate judge’s
order in this regard.
b. Allegations Regarding Calvey’s Non-Compete Agreement
As to plaintiff’s second argument, the Court finds that plaintiff has failed to
identify any “clearly erroneous action by the magistrate judge that materially affects
the outcome of this litigation.” Gilbert v. Cates, No. 17-4786, 2018 WL 4363590, at *4
(E.D. La. Sept. 13, 2018) (Milazzo, J.). According to plaintiff, the magistrate judge’s
conclusion that the second amended complaint restated the allegations related to the
non-compete “arises only from a confusion of the allegations of the [f]irst and [s]econd
[a]mended [c]omplaints.”44
44 R. Doc. No. 52-1, at 4.
It is true that, in determining that the proposed second amended complaint
reincorporated allegations pertaining to an alleged non-compete agreement between
Calvey and plaintiff, the magistrate judge’s order cited paragraph 18 of the first
amended complaint rather than the proposed pleading.45 But this mistake hardly
undermines the magistrate judge’s conclusion that granting leave to amend would be
futile. As the magistrate judge correctly pointed out,46 the first paragraph of the
second amended complaint confusingly provides that it “restat[es] all previously filed
complaints to specifically remove all claims based on the non-compete provisions of
the Agreement Not to Compete entered into by [] Calvey and [plaintiff] on May 12,
2015[.]”47 Even accepting that the second amended complaint removes any reference
to the non-compete agreement between plaintiff and Calvey despite this confusing
language, plaintiff does not convincingly explain how the magistrate judge’s mistake
would significantly affect the analysis around futility.
Plaintiff argues only that, because one of the goals of the proposed second
amended complaint was to remove the previously alleged claims against Calvey
premised on the non-compete provision of his employment agreement, the magistrate
judge’s “mistake is significant.”48 Yet the decision to deny leave to amend was not
predicated solely on the magistrate judge’s understanding that the proposed amended
complaint did not meet one of its stated goals. Rather, the decision was based on a
45 See R. Doc. No. 48, at 9–10.
46 See id.
47 R. Doc. No. 31-2, ¶ 1.
48 R. Doc. No. 52-1, at 4.
number of findings, including the magistrate judge’s findings that granting leave to
amend as to the LUTPA claim, LUTSA claim, and conversion claim in the proposed
second amended complaint would be futile.49 Accordingly, the Court cannot conclude
on the basis of this error that the magistrate judge’s decision to deny leave to amend
based on futility was clearly erroneous or contrary to law.
c. Breach of the Non-Solicitation Agreement
However, with respect to plaintiff’s third argument, the Court finds that the
magistrate judge clearly erred in holding that permitting the second amended
complaint to be filed would be futile as to plaintiff’s claim that Ochsner breached its
non-solicitation agreement with plaintiff. The magistrate judge’s holding was
predicated on the incorrect notion that, pursuant to § 23:921(C) of the Louisiana
Revised Statutes, the non-solicitation agreement between plaintiff and Ochsner
would only be enforceable if it contained a geographical restriction specifying the
“parish or parishes, municipality or municipalities, or parts thereof.”50
As plaintiff notes,51 § 23:921(C) applies to agreements requiring those
“employed as an agent, servant or employee” to refrain from soliciting customers from
their employers. La. Rev. Stat. Ann. § 23:921(C). By its terms, the statute does not
appear to apply to agreements like plaintiff’s agreement with Ochsner. The non-
solicitation agreement was an agreement between plaintiff and Ochsner not to solicit
each other’s employees, not customers. Moreover, the agreement does not appear to
49 See generally R. Doc. No. 48, at 9–14.
50 Id. at 10–12.
51 R. Doc. No. 52-1, at 5.
qualify as an agreement between an employer and someone “employed as an agent,
servant, or employee” since there is no indication that Ochsner was employed in any
of these capacities by plaintiff. Id. § 23:921(C).
Defendants contend that the magistrate judge’s ultimate conclusion regarding
the futility of the proposed amended claim for breach of the non-solicitation
agreement is not clearly erroneous because it can be upheld on a different and
independent basis.52 According to defendants, “there is no allegation in the proposed
amended pleading . . . that Ochsner successfully solicited Calvey—or any other HHS
employee it identifies.”53 More specifically, defendants assert that the proposed
second amended complaint’s allegations are insufficient to state a claim for breach of
the non-solicitation provision of the Ochsner contract, noting that “there is no
allegation that Ochsner actually solicited Calvey, or that Ochsner actually hired any
[of plaintiff’s] employee(s) whom it also solicited.”54
The Court disagrees. The proposed second amended complaint does state a
claim for breach of the non-solicitation provision of the Ochsner contract. As
explained, the proposed complaint alleges that plaintiff’s contract with Ochsner
contained a non-solicitation provision prohibiting Ochsner and plaintiff from
soliciting each other’s employees for twelve months after termination of the
contract.55 The proposed complaint also alleges that “Ochsner actively solicited
52 R. Doc. No. 54, at 4.
53 Id. at 5.
54 Id. (quoting R. Doc. No. 25-1 (memorandum in support of motion to dismiss), at 8–
9) (emphasis in original).
55 R. Doc. No. 31-2, ¶ 5.
[plaintiff’s] management employees for positions as Ochsner employees, and has
hired at least three HHS employees, namely [] Calvey, Louisa Spears, and Edward
Barnes.”56
To state a plausible breach of contract claim pursuant to Louisiana law,
plaintiff must allege that (1) a contract existed between the parties; (2) defendant
breached that contract; and (3) plaintiff suffered damages as a result. D.H. Griffin
Wrecking Co., 463 F. Supp. 3d at 727. Defendants suggest that, in order to find that
the second amendment states a breach of contract claim, the Court would need to
make a “speculative leap” to infer from Calvey’s employment by Ochsner and from
Ochsner’s alleged recruitment of unidentified managers, that “it follows that Ochsner
solicited Calvey (as opposed to Calvey seeking out employment with Ochsner, which
is exactly what happened).”57 As discussed, the second amended complaint states that
a contract existed between the parties which included a non-solicitation of employees
agreement, that Ochsner breached that contract by soliciting plaintiff’s management
employees, and that plaintiff suffered damages as a result. The Court is not
persuaded that any “speculative leap” is required to find that plaintiff has stated a
breach of contract claim.58 Accordingly, with respect to this claim, permitting plaintiff
56 R. Doc. No. 31-2, ¶ 11.
57 R. Doc. No. 54, at 5 (quoting R. Doc. No. 25-1, at 8–9).
58 At this early stage, the Court expresses no view as to whether a motion for
summary judgment on this question would be appropriate.
to amend its complaint would not be futile. The magistrate judge’s denial of leave to
amend on this basis was clearly erroneous.59
IV. CONCLUSION
For the foregoing reasons,
IT IS ORDERED that the magistrate judge’s order is AFFIRMED IN PART
and REVERSED IN PART. Plaintiff’s second amended complaint shall be filed into
the record. The proposed pleading states a plausible breach-of-contract claim against
Calvey based on Calvey’s agreement with plaintiff to refrain from using or disclosing
confidential information. It also states a plausible breach-of-contract claim against
Ochsner based on the non-solicitation agreement in Ochsner’s alleged contract with
plaintiff. However, plaintiff’s LUPTA, LUTSA, and conversion claims are
DISMISSED WITH PREJUDICE as futile.
IT IS FURTHER ORDERED that defendants’ motion60 to strike or dismiss
plaintiff’s first amended complaint is DISMISSED AS MOOT in light of the analysis
set forth herein.
59 The Court notes defendants’ request that the Court condition any grant or partial
grant of leave to amend on plaintiff’s payment of any attorneys’ fees incurred by
defendants in defending against the now-removed allegations relating to the non-
compete in Calvey’s contract with plaintiff. See R. Doc. No. 54, at 6 n.7. Defendants
do not cite the authority pursuant to which they seek attorneys’ fees, and the Court
does not find such fees to be appropriate.
60 R. Doc. No. 25.
New Orleans, Louisiana, January 24, 2024.
ANCE M. AFRICK
UNITED STATES DISTRICT JUDGE
19