Brown & Root Industrial Services, LLC v. Brown

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF LOUISIANA

BROWN & ROOT INDUSTRIAL CIVIL ACTION

SERVICES, LLC, ET AL.

VERSUS

JAESON M. BROWN NO. 21-00291-BAJ-SDJ

RULING AND ORDER

This is a trade secrets case. Plaintiff Brown & Root Industrial Services, LLC

filed a Complaint on May 18, 2021, asserting claims for violation of the Computer

Fraud and Abuse Act, 18 U.S.C. § 1080(e), misappropriation of trade secrets under

the Defend Trade Secrets Act (DTSA), 18 U.S.C. §1836, and the Louisiana Uniform

Trade Secrets Act (LUTSA), La. R.S. 51:1431, et seq., breach of fiduciary duty and

unjust enrichment. (Doc. 1). In September 2021, with leave of the Court, Brown &

Root joined Plaintiff BRIS Engineering, LLC and filed an Amended Complaint for

Injunctive Relief and Damages (Doc. 24), adding additional Defendants and a state

law claim for civil conspiracy. Generally, Plaintiffs allege that the individual

Defendants left jobs at BRIS to work for Defendant Fides Consulting, LLC, and those

Defendants have disclosed and used BRIS’ trade secrets in their work for Fides. (Doc.

24). Plaintiffs’ claim for unjust enrichment is only asserted against Fides. (Id. at 42).

Fides is also the subject of Plaintiffs’ claims under DTSA and LUTSA, which are

asserted against all Defendants. (/d. at 36, 39). Now before the Court is Defendants’

Motion to Dismiss Plaintiffs’ Unjust Enrichment Claim (Doc. 85), which seeks

to dismiss the unjust enrichment claim against Fides for failure to state a claim upon

which relief can be granted under Federal Rule of Civil Procedure 12(b)(6). The

Motion is opposed. (Doc. 91). For the reasons that follow, the Motion will be granted.

A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint against

the legal standard set forth in Rule 8, which requires “a short and plain statement of

the claim showing that the pleader is entitled to relief.” Fed. R. Civ. Proc. 8(a)(2). “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 Atl. Corp. v. Twombly, 550 U.S. 544, 570

(2007)). “Determining whether a complaint states a plausible claim for relief [is] . . .

a context-specific task that requires the reviewing court to draw on its judicial

experience and common sense.” Jd. at 679. “[Flacial plausibility” exists “when the

plaintiff pleads factual content that allows the court to draw the reasonable inference

that the defendant is liable for the misconduct alleged.” Jd. at 678 (citing Twombly,

550 U.S. at 556). When conducting its inquiry, the Court must “accept[ ] all

well-pleaded facts as true and view ] those facts in the light most favorable to the

plaintiff” Bustos v. Martini Club Inc., 599 F.3d 458, 461 (5th Cir. 2010) (quotation

marks omitted).

Defendants move to dismiss Plaintiffs’ state law unjust enrichment claim. The

Louisiana Civil Code provides that the remedy for unjust enrichment “is subsidiary

and shall not be available if the law provides another remedy ... or declares a

contrary rule.” La. Civ. Code art. 2298. The Louisiana Supreme Court has set out five

requirements for unjust enrichment claims: (1) there must be an enrichment; (2)

there must be an impoverishment; (3) there must be a connection between the

enrichment and resulting impoverishment; (4) there must be an absence of

Justification’ or ‘cause’ for the enrichment and the impoverishment; and (5) there

must be no other remedy at law available to the plaintiff. Baker v. Maclay Properties

Co., 648 So. 2d 888, 897 (La. 1995).

Defendants contend that Plaintiffs cannot meet the fifth element because

Plaintiffs have other remedies available against Fides: the DTSA and LUTSA claims.

Plaintiffs argue that they may plead unjust enrichment as an alternative theory

pursuant to Federal Rule of Civil Procedure 8(d)(3), which allows a party to allege

seemingly inconsistent alternative causes of action. Specifically, Rule 8(d)(3) provides

that “[a] party may state as many separate claims or defenses as it has, regardless of

consistency.” Id.

In Walters v. MedSouth Rec. Mgmt., LLC, 38 So. 3d 248, 244 (La. 2010), the

Louisiana Supreme Court held that a plaintiff “failed to state a cause of action in

unjust enrichment” when “the law provided plaintiff with another remedy.”

Additionally, the Walters court found that “[t]he mere fact that a plaintiff does not

successfully pursue another available remedy does not give the plaintiff the right to

recover under the theory of unjust enrichment.” Id. In other words, even though a

plaintiff may not succeed when it pursues its other available remedies, there is no

cause of action in unjust enrichment if such a remedy exists. See Ferrara Fire

Apparatus, Inc. v. JLG Indus., Inc., 581 F. App’x 440, 443-44 (5th Cir. 2014) (“The

important question is whether another remedy is available, not whether the party

seeking a remedy will be successful.”). Similarly, the U.S. Court of Appeals for the

Fifth Circuit, in Bank of Abbeville & Tr. Co. v. Commonwealth Land Title Ins. Co.,

201 F. App’x 988, 990-91 (5th Cir. 2006), held that, as a matter of substantive

Louisiana law, a plaintiff was “not entitled to relief... under the theory of unjust

enrichment” when it cannot prove “a lack of other remedy at law.”

Nevertheless, Louisiana’s federal district courts are divided on whether Rule 8

permits a plaintiff to plead unjust enrichment in the alternative. In JP Mack

Industries LLC v. Mosaic Fertilizer, LLC, 970 F. Supp. 2d 516, 520-21 (E.D. La. 2013),

the court granted a defendant’s motion to dismiss an unjust enrichment claim

because alternate remedies were available. The JP Mack court found that, under

Louisiana law, unjust enrichment is “subsidiary,” not “alternative.” Id.; see also

Zavert v. Condor Petroleum Corp., 27 F. Supp. 8d 695, 699-702 (W.D. La. 2014)

(collecting cases and holding that unjust enrichment claims may not be pled in the

alternative when other remedies exist). Other courts have found that Louisiana law

permits unjust enrichment to be pled in the alternative. See Schott, Tr. for Est. of

InforMD, LLC v. Massengale, No. 18-759, 2019 WL 4738795, at *16 (M.D. La. Sept.

27, 2019) (finding that Rule 8(d)(3) permits a plaintiff to plead a claim for unjust

enrichment under Louisiana law in the alternative); U.S. ex rel. Sun Coast

Contracting Servs., LLC v. DQSI, LLC, No. 13-00297-BAJ-RLB, 2014 WL 7246936,

at “5 (M.D. La. Dec. 17, 2014). In those cases, however, the validity of the other claims

arising out of the same facts was still in question. See Schott, 2019 WL 4738795, at

*17 (“the validity of the other claims... are still in question.”); Sun Coast, 2014 WL

7246936, at *4 (“[T]he validity of the contract itself remains contested.”); see also

Perez v. Utility Constructors, No. 15-4675, 2016 WL 5930877, at *2 (E.D. La. Oct. 12,

2016) (holding that, “until the validity of [an] alleged contract can be determined,” an

unjust enrichment claim “should not be dismissed on the ground that [the plaintiff]

has another available remedy” (quotations omitted)); see also 24/7 Restoration

Specialists, LLC v. Young, 634 F. Supp. 3d 287, 292 (E.D. La. 2022) (same). In

contrast, courts have held that when the validity of other claims is not in question,

the plaintiff may not plead a cause of action for unjust enrichment because another

adequate remedy at law exists. Perez, 2016 WL 5930877, at *2 (citing Wood Materials

LLC v. Berkley Ins. Co., No. 17-10955, 2018 WL 5604738, at *5—6 (E.D. La. Jan. 24,

2018)). The Fifth Circuit has approved this approach. See Jones v. Administrators of

Tulane Educ. Fund, 51 F.4th 101, 119 (5th Cir. 2022) (‘Because the parties here

disagree whether a contract for in-person instruction and on-campus facilities exists,

it is not clear whether another remedy is available under the law” (quotation

omitted)).

Here, where Plaintiffs’ claims under DTSA, LUTSA, and unjust enrichment

arise from identical operative facts, Plaintiffs have failed to establish that the validity

of their DTSA and LUTSA claims are in question. Instead, Plaintiffs offer the

conclusory argument that if the Court dismissed those claims at some unspecified

point in litigation and for some unspecified reason, Plaintiffs would no longer have a

remedy at law and therefore should be allowed to proceed with the unjust enrichment

claim. (Doc. 91 at 5). But if the Court were to accept this line of reasoning, every in-

the-alternative claim for unjust enrichment would survive. Courts interpreting

Louisiana’s unjust enrichment law demand more. Bank of Abbeville, 201 F. App’x at

990-91 (holding that plaintiff was “not entitled to relief... under the theory of unjust

enrichment” unless it can prove “a lack of other remedy at law”). The validity of a

primary claim, and therefore the availability of unjust enrichment as an alternative

remedy, cannot rest solely on the vague possibility that the primary claim could fail.

See Jones, 51 F.4th at 119 (allowing unjust enrichment in the alternative when the

parties disputed the existence of a contract underlying a breach of contract claim);

Nave v. Gulf States Servs. LEC, No. CV 20-546, 2020 WL 4584294, at *2 (E.D. La.

Aug. 10, 2020) “Unjust enrichment... may not be asserted against a defendant asa

mere catchall or safety net in the event that a plaintiff fails to succeed on the merits

of his or her other claims.” (quotation omitted)).

As Defendants note, the issue here is not whether Plaintiffs may assert a

possibly inconsistent alternative claim, but rather whether “Plaintiffs are legally

entitled to assert a claim for unjust enrichment.” (Doc. 98 at 3). An element of

Louisiana’s version of unjust enrichment is that no other remedy at law is available.

Walters, 38 So. 3d at 244. Here, a review of the record and the parties’ briefing shows

that the validity of the DTSA and LUTSA claims is not in question. As such, other

remedies are available to Plaintiffs, and therefore Plaintiffs have failed to plausibly

allege that all the elements of unjust enrichment are met. See Iqbal, 556 U.S. at 678.

Accordingly,

IT IS ORDERED that Defendants’ Motion to Dismiss (Doc. 85) be and is

hereby GRANTED.

IT IS FURTHER ORDERED that Plaintiffs’ claim for unjust enrichment

against Defendant Fides Consulting, LLC be and is hereby DISMISSED WITH

PREJUDICE.

Judgment shall issue separately.

Baton Rouge, Louisiana, this! ~~ day of August, 2024

a.-

JUDGE BRIAN A. JACKSON

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF LOUISIANA