SIM LAKE, District Judge.
Plaintiff, PEMEX Exploracion y Produccion ("PEP"), has brought suit against multiple defendants for claims arising from sales in the United States of natural gas condensate allegedly stolen from PEP in Mexico. On June 8, 2012, the court held a scheduling conference and issued a Memorandum Opinion and Order (Docket Entry No. 106) granting three motions to dismiss to the extent that they sought dismissal of claims that PEP had asserted under Mexican law for illegal possession and use of Mexican sovereign property: (1) Defendant Sunoco Partners Marketing & Terminals, L.P.'s ("Sunoco") Motion to Dismiss in Lieu of Answer or Alternatively to Sever (Docket Entry No. 17), (2) Defendants Shell Trading U.S. Company ("STUSCO") and Shell Chemical LP's ("Shell Chemical") Motion to Dismiss (Docket Entry No. 31), and (3) Defendant FR Midstream Transport, LP's ("FR Midstream") Fed. R.Civ.P. 12 Motions to Dismiss, Joinder in All Other Defendants' Fed.R.Civ.P. 12 Motions to Dismiss, and, in the Alternative, Fed.R.Civ.P. 12(e) Motion for a More Definite Statement (Docket Entry No. 43).
For reasons stated on the record at the June 8, 2012, scheduling conference, defendants waived all Rule 12(b) arguments except standing asserted in the following motions to dismiss:
Also pending are the following motions seeking leave to designate responsible third parties: Defendant FR Midstream Transport, LP's Motion for Leave to Designate Responsible Third Parties (Docket Entry No. 120); Plains Marketing, L.P.'s Motion for Leave to Designate Responsible Third Parties (Docket Entry No. 121); Defendants Shell Chemical LP and Shell Trading U.S. Company's Motion for Leave to Designate Responsible Third Parties (Docket Entry No. 123); Defendant Superior Crude Gathering, Inc.'s Motion to Join in Defendants Shell Chemical LP and Shell Trading U.S. Company's Motion for Leave to Designate Responsible Third Parties (Docket Entry No. 124); High Sierra Crude Oil & Marketing, LLC's Motion to Join Defendants Shell Chemical LP and Shell Trading U.S. Company's Motion for Leave to Designate Responsible Third Parties (Docket Entry No. 125); Joint Motion for Leave to Designate Responsible Third Parties filed by Sunoco Partners Marketing & Terminals L.P., ConocoPhillips Co., and Marathon Petroleum Company, L.P. ("Marathon") (Docket Entry No. 127); Defendant Murphy Energy Corporation's
For the reasons explained below, the motions to dismiss for lack of standing will be granted; the motions to designate responsible third-parties for PEP's indirect, assigned claims will be declared moot; and the motions to designate responsible third parties for PEP's direct claims for conversion, equitable relief, constructive trust, unjust enrichment, and money had and received will be granted.
This is the third action that PEP has filed in this court based on allegations of "trade in the United States of natural gas condensate stolen in Mexico."
Defendants Plains, STUSCO, Murphy Energy, F & M Transportation, Big Star, St. James, High Sierra, and Superior Crude argue that the indirect claims that PEP has asserted as assignee of AGE Refining, Inc. ("AGE"), Flint Hills Resources, Inc. ("Flint Hills"), and/or Valero Marketing and Supply Company ("Valero") for fraud, breach of warranty, and breach of contract are subject to dismissal under Rule 12(b)(1) for lack of subject matter jurisdiction because PEP lacks standing to assert these claims.
A motion to dismiss pursuant to Fed. R.Civ.P. 12(b)(1) for lack of subject matter jurisdiction tests the court's statutory or constitutional power to adjudicate the case. Home Builders Association of Mississippi, Inc. v. City of Madison, Miss., 143 F.3d 1006, 1010 (5th Cir.1998). "The burden of proof for a Rule 12(b)(1) motion to dismiss is on the party asserting jurisdiction." Ramming v. United States, 281 F.3d 158, 161 (5th Cir.2001), cert. denied sub nom. Cloud v. United States, 536 U.S. 960, 122 S.Ct. 2665, 153 L.Ed.2d 839 (2002). In examining a Rule 12(b)(1) motion, the district court can consider matters of fact that may be in dispute.
Id. (citing Barrera-Montenegro v. United States, 74 F.3d 657, 659 (5th Cir.1996)). Dismissal on jurisdictional grounds alone is not a dismissal on the merits. Id. (citing Hitt v. City of Pasadena, 561 F.2d 606, 608 (5th Cir.1977) (per curiam)).
Standing questions "whether the litigant is entitled to have the court decide the merits of the dispute or of particular issues." Warth v. Seldin, 422 U.S. 490, 95 S.Ct. 2197, 2205, 45 L.Ed.2d 343 (1975). "[S]tanding is an essential and unchanging part of the case-or-controversy requirement of Article III." Lujan v. Defenders of Wildlife, 504 U.S. 555, 112 S.Ct. 2130, 2136, 119 L.Ed.2d 351 (1992). "Standing requires, at a minimum, three elements: injury in fact, a `fairly traceable' causal link between that injury and the defendant's conduct, and the likelihood that the injury will be `redressed by a favorable decision.'" Cadle Co. v. Neubauer, 562 F.3d 369, 371 (5th Cir.2009) (quoting Lujan, 112 S.Ct. at 2136). "A defect in Article III standing is a defect in subject-matter jurisdiction." Id. at 374. See also Harold H. Huggins Realty, Inc. v. FNC, Inc., 634 F.3d 787, 795 n. 2 (5th Cir.2011) ("dismissal for lack of constitutional standing... should be granted under Rule 12(b)(1)"). "Standing is a question of law" for the court to decide. Friends of St. Frances Xavier Cabrini Church v. Federal Emergency Management Agency, 658 F.3d 460, 466 (5th Cir.2011). In deciding questions of law, including standing, involving claims based on state law, applicable state law governs. See Crocker v. Federal Deposit Insurance Corp., 826 F.2d 347, 349 (5th Cir.1987), cert. denied, 485 U.S. 905, 108 S.Ct. 1075, 99 L.Ed.2d 235 (1988).
"In Texas, the standing doctrine requires a concrete injury to the plaintiff and a real controversy between the parties that will be resolved by the court." Heckman v. Williamson County, 369 S.W.3d 137, 154 (Tex.2012). Because the Texas test for standing parallels the federal test for Article III standing, Texas courts "turn for guidance to precedent from the U.S. Supreme Court, which has elaborated on standing's three elements." Id. "The standing inquiry `requires careful judicial examination of a complaint's allegations to ascertain whether the particular plaintiff is entitled to an adjudication of the particular claims asserted.'" Id. at 156 (quoting Allen v. Wright, 468 U.S. 737, 104 S.Ct. 3315, 3325, 82 L.Ed.2d 556 (1984)).
Subject to limited exceptions, Texas law allows assignees to assert assigned claims. See State Farm Fire & Casualty Co. v. Gandy, 925 S.W.2d 696, 705-07 (Tex.1996) (acknowledging that causes of action in Texas are freely assignable). However, the only injury sufficient to support an assignee's standing to assert an assigned claim is an injury suffered by the assignor, and that injury must satisfy all the requirements of constitutional standing, i.e., the injury suffered must be an injury-in-fact that is causally traceable to a named defendant and likely to be redressed by the court action. See Gulf Insurance Co. v. Burns Motors, Inc., 22 S.W.3d 417, 420 (Tex.2000) (citing Jackson v. Thweatt, 883 S.W.2d 171, 174 (Tex.1994) (recognizing that assignees stand in assignors' shoes and may assert only those rights that the assignors' themselves could assert)). See also Southwestern Bell Telephone Co. v. Marketing on Hold Inc., 308 S.W.3d 909, 916 (Tex.2010) (a holder of contractually valid assignments steps "into the shoes of the claim-holders and is considered under
Defendants Plains, STUSCO, Murphy Energy, F & M Transportation, Big Star, St. James, High Sierra, and Superior Crude argue that PEP lacks standing to assert indirect, assigned claims for fraud, breach of warranty, and breach of contract because the assignors, AGE, Flint Hills, and/or Valero, have not suffered an injury-in-fact traceable to these defendants. Alternatively, these defendants argue that the assignments to PEP are void under Texas law as against public policy. For the reasons explained below, the court concludes that PEP lacks standing to assert the assigned claims because PEP has failed to show that the assignors suffered an injury-in-fact traceable to these defendants. Alternatively the court concludes that PEP lacks standing to assert the assigned claims because the assignments are void under Texas law.
Asserting that PEP has made only conclusory allegations of entitlement to unspecified damages for the assigned claims, Plains argues that PEP has failed to show that the assignors suffered an injury-in-fact. Citing Rivera v. Wyeth-Ayerst Laboratories, 283 F.3d 315 (5th Cir.2002), Plains states that in that case
Plains also argues that AGE and Valero will never suffer any damages, and that AGE's and Valero's promises to reimburse PEP do not confer standing.
The other defendants all make the same or virtually the same arguments regarding the assigned claims asserted against them.
PEP responds that the injury-in-fact needed to establish constitutional standing is satisfied merely by the assignors' involvement in this matter.
PEP argues that "[t]hose promises are damage supporting recovery under the assignments, despite PEP's promises to limit how it recovers on those promises."
PEP's argument that the threshold for constitutional standing is met by the assignors' involvement in this matter lacks merit because PEP has neither alleged nor argued that the assigned claims for fraud, breach of warranty, and/or breach of contract asserted in this action seek redress for injuries that the assignors suffered as a result of their involvement in this matter, or that any such injury is traceable to any of the named defendants or redressable by the claims asserted in this action. Instead, PEP candidly states that "PEP is not bringing the assigned claims to recover for Valero's [AGE's] [Flint Hills'] embarrassment at having been involved in the injuring of a major trading partner. PEP brings the assigned claims to recover the value of the goods sold to the assignors."
PEP argues that the promises to reimburse PEP for any stolen gas condensate that the assignors purchased and/or received are "damage supporting recovery under the assignments, despite PEP's promises to limit how it recovers on those promises." PEP explains that the assignors' promises to reimburse are damages supporting recovery under the assignments "because a covenant not to collect is a contract and not a release of the underlying liability."
The cases on which PEP relies are distinguishable and inapposite because they did not identify a mere promise to reimburse as an injury sufficient to establish constitutional standing. In fact, standing was not at issue in either of the two cases cited by PEP. Instead, each of the cases cited by PEP involved assignments from assignors who had suffered actual injuries in the form of judgments that imposed liability on the assignors. See Puget Plastics, 649 F.Supp.2d at 617, 619, 624-26 (defendant adjudged liable by trial court assigned rights to an insurance policy, and accepted a covenant not to execute except as to the assigned insurance); Ard, 894 S.W.2d at 15 (agreement at issue was covenant not to execute judgments that imposed liability on assignors). PEP's argument that promises made by AGE, Flint Hills, and Valero to reimburse PEP for stolen gas condensate constitute injuries-in-fact lacks merit because instead of establishing that the assignors suffered an injury by having admitted to liability, or having been held liable for purchasing and/or receiving stolen gas condensate, the agreements establish that the assignors (1) deny liability for having purchased and/or received stolen gas condensate, and (2) will not be held liable for purchasing and/or receiving stolen gas condensate because in addition to agreeing not to seek reimbursement from the assignors, PEP has agreed not to pursue its claims against the assignors.
The agreements that PEP has entered with each of the three assignors contains the following paragraph pursuant to which the parties agree that the assignors have not admitted liability:
Each of the agreements also either releases the assignors from being held liable
The Flint Hills agreement states that Flint Hills' assignment of its claims to PEP
Because the Flint Hills' agreement states that "PEP fully releases and waives any and all claims relating to the subject hydrocarbons that it may have against Flint Hills,"
The AGE agreement states that
Because the AGE agreement states that PEP "covenants not to sue, collect, file a claim against AGE in the Bankruptcy Case or Liquidating Trust, or otherwise act against AGE in any manner," that "[t]he intention is that AGE will not be subject to any monetary payments or liability to PEP," that "PEP will withdraw with prejudice its Proof of Claim filed in the Bankruptcy Case," and that "PEP further agrees not to file any future claim or demand for payment in the Bankruptcy Case or with the Liquidating Trust established in the Bankruptcy Case," AGE faces no imminent threat of being held liable for purchasing and/or receiving stolen condensate. Consequently, AGE faces no imminent threat of ever having to pay PEP damages for having purchased and/or received stolen gas condensate. Because AGE has not been held liable and faces no threat of being held liable to PEP for purchasing and/or receiving stolen gas condensate, AGE has not suffered an injury-in-fact arising from its purchase and/or receipt of stolen gas condensate capable of supporting PEP's standing to assert the assigned claims.
As additional evidence that AGE has not suffered an injury-in-fact capable of supporting PEP's standing to assert AGE's assigned claims, defendants point to the joint motion for approval of the settlement agreement submitted to the AGE Bankruptcy Court on February 2, 2012.
PEP has not submitted any evidence showing that since the joint motion was
PEP admits that its covenant to collect on the assignors' promises to reimburse PEP for purchasing and/or receiving stolen gas condensate solely through the assigned claims means that Flint Hills and the bankrupt AGE are making no payment.
PEP's argument that by paying a very material sum in damages to PEP, Valero suffered an injury capable of establishing standing lacks merit because the Valero agreement that PEP cites in support of this argument required Valero to pay PEP
Thus, the Valero agreement establishes that (1) Valero reimbursed PEP the sum of $3,750,000.00 for gas condensate purchased from Kemco Resources, Inc., an entity that is not a defendant in this action,
PEP has neither alleged nor pointed to any evidence showing that the assigned claims asserted in this action seek damages for injuries-in-fact suffered by the assignors, or that any injuries-in-fact suffered by the assignors are traceable to a defendant named in this action. Instead, PEP candidly admits that it "is not bringing the assigned claims to recover for Valero's [Flint Hills'] [AGE's] embarrassment at having been involved in the injuring of a major trading partner. PEP brings the assigned claims to recover the value of the goods sold to the assignors."
Defendants Plains, STUSCO, Murphy Energy, F & M Transportation, High Sierra, and Superior Crude argue that the assignments to PEP of the indirect claims asserted in this action are void under Texas law as against public policy because a settling defendant cannot attempt to preserve its contribution rights by assigning those rights to the plaintiff, and because they distort the litigation.
Citing Jackson v. Freightliner Corp., 938 F.2d 40, 41-42 (5th Cir.1991), and Beech Aircraft Corp. v. Jinkins, 739 S.W.2d 19, 22 (Tex.1987), defendants Plains, STUSCO, Murphy Energy, F & M Transportation, High Sierra, and Superior Crude argue that PEP lacks standing to assert the indirect, assigned claims that it has alleged in this action because Texas law prohibits AGE, Flint Hills, and Valero from assigning any contribution rights against non-settling defendants.
In Beech Aircraft, 739 S.W.2d at 20, three settling defendants tried to bring post-settlement counterclaims for contribution against the remaining non-settling defendant. The Texas Supreme Court held that "a defendant can settle only his proportionate share of common liability and cannot preserve contribution rights under either the common law or the comparative negligence statute by attempting to settle the plaintiff's entire claim." Id. at 22. Under well-established Texas law, therefore, a settling tortfeasor is not entitled to contribution from a non-settling tortfeasor. See Jackson, 938 F.2d at 41-42 (examining Texas case law holding that a settling tortfeasor has no right of contribution against a non-settling tortfeasor).
PEP argues that Jackson is distinguishable because the assigned claims in that case were for contribution and indemnity, while the assigned claims at issue here are assigned claims for breach of warranty and breach of contract made pursuant to Texas's version of the Uniform Commercial Code (UCC). PEP argues that
PEP's argument that the assigned claims asserted in this action are not claims for contribution or indemnity but, instead, claims for breach of warranty and breach of contract, is belied, however, by the terms of the assignment clauses included in the settlement agreements. The Flint Hills agreement provides as follows:
Like Trailmaster, the settling manufacturer of the gasoline trailer in Jackson, 938 F.2d at 40, who impermissibly attempted to preserve its contribution rights against its alleged joint tortfeasors by assigning its third-party claims to the decedent truck driver's beneficiaries, AGE, Valero, and Flint Hills have impermissibly attempted to preserve their contribution rights against their alleged joint tortfeasors by assigning their third-party claims to PEP. Although PEP's Original Complaint characterizes the assigned claims as claims for breach of contract and breach of warranty, the claims that PEP seeks to assert as assignee of AGE, Flint Hills, and Valero are derivative of the causes of action PEP has asserted in this lawsuit and are, therefore, actually third-party claims for contribution and indemnity. PEP acknowledged this in the joint motion for approval of the AGE settlement agreement filed in bankruptcy court:
Because the assigned claims asserted in this action are all contingent upon PEP's ability to hold AGE, Flint Hills, and Valero liable for having purchased and/or received stolen gas condensate, the assigned claims are claims for contribution from non-settling tortfeasors that are invalid under Texas law regardless of how they are characterized in PEP's pleadings. See Jackson, 938 F.2d at 40. See also Garland Dollar General LLC v. Reeves Development, LLC, Civil Action No. 3:09-CV-0707-D, 2010 WL 1962560, *3 (N.D.Tex. May 17, 2010) ("Reeves Development cannot bring a contribution claim framed as an action for breach of contract.").
Citing State Farm Fire and Casualty Company v. Gandy, 925 S.W.2d 696
In Gandy the Texas Supreme Court considered and found impermissible a settlement agreement and assignment similar to the settlements and assignments at issue in this action. Gandy sued her stepfather for sexual abuse, and State Farm, his insurer, agreed to undertake his defense while reserving its right to deny coverage. The stepfather settled with Gandy for an agreed judgment of $6 million and assigned all his claims against State Farm both for coverage and for negligent defense to Gandy, and Gandy agreed not to collect from her stepfather but, instead, to pursue the assigned claims against State Farm. Id. at 697-98. Gandy then sued State Farm in a new lawsuit, and State Farm argued that the assignment of claims was invalid as against public policy. The court of appeals agreed in principle, stating that the assignment should effectively be void because the agreement not to execute against the stepfather meant that the stepfather had not suffered any damages from Gandy's tort claims against him, and could not therefore collect on a claim against State Farm. Nevertheless, the court of appeals reasoning that since State Farm had voluntarily agreed to defend the stepfather, State Farm had a duty to conduct the defense properly. Id. at 698.
The Texas Supreme Court reversed, holding that the stepfather's assignment of claims to Gandy violated public policy and, therefore, conveyed nothing. Id. The Court cited four instances in which Texas courts have held agreements to assign claims invalid: (1) assignment of legal malpractice claims, id. at 707-08; (2) Mary Carter agreements, whereby a plaintiff assigns to a settling defendant part of his claims against any nonsettling defendants, id. at 709-10; (3) assignment of a plaintiff's claim to a tortfeasor as part of a settlement agreement, which allows the settling defendant to prosecute the claim against a joint tortfeasor, id. at 710-11; and (4) assignment of interests in an estate, id. at 711. The Court observed that these instances show that "[i]n widely different
Observing that the stepfather's settlement with Gandy not only prolonged the litigation but also "greatly distorted the litigation that followed [the settlement]," id. at 712, the Court concluded that Gandy and her stepfather had perpetrated a fraud against State Farm by trying to hold it liable for damages for which it would not have been liable had the case proceeded to trial against the stepfather. Id. at 712-13. The Court explained that
Id. at 714.
Citing H.S.M. Acquisitions v. West, 917 S.W.2d 872 (Tex.App.-Corpus Christi 1996, writ denied), the Gandy Court acknowledged that settlement arrangements like the one at issue in Gandy are not confined to insurance cases but are also used in other contexts. The Court explained that in the H.S.M. Acquisitions case
Gandy, 925 S.W.2d at 715. Because, like the settlement agreements found invalid in Gandy and H.S.M. Acquisitions, the settlement agreements that AGE, Flint Hills, and Valero entered with PEP increase the complexity of the litigation and misalign
Like the settlement agreements at issue in Gandy and H.S.M. Acquisitions, the settlement agreements that AGE, Flint Hills, and Valero entered with PEP did not end any litigation and offered no reasonable expectation of ending any litigation. The agreements that PEP entered with all three assignors show that they were not intended to secure damages from AGE, Flint Hills, or Valero but, instead, were intended to provide PEP a way to recover against the defendants named in this action. Like the stepfather in Gandy and the lessee in H.S.M. Acquisitions who suffered no damages because plaintiffs in those cases agreed not to enforce the judgments that they obtained against the settling defendants, AGE, Flint Hills, and Valero have not suffered any damages because PEP, the only party that could claim superior title to the gas condensate, has agreed not to pursue liability claims against them, and not to enforce their promises to reimburse PEP for any stolen gas condensate they purchased and/or received. PEP's covenants not to seek to hold AGE, Flint Hills, or Valero liable for having purchased and/or received stolen gas condensate and not to enforce their promises to reimburse PEP are, therefore, analogous to the agreements at issue in Gandy and H.S.M. Acquisitions. Moreover, the assignments at issue in this case put PEP into a dual role as both the alleged original owner of the gas condensate at issue and the last purchaser of that gas condensate. The dual role that the assignments require PEP to play in this litigation threatens to confuse the jury as to whose damages should be considered and raises the possibility that PEP could receive a prohibited double recovery of the same damages if it is successful in this action and in the BASF suit. See Jackson, 938 F.2d at 42.
The court concludes that like the settlements and agreed judgments at issue in Gandy and H.S.M. Acquisitions, the settlement agreements and assignments of claims at issue in this action are invalid because they did not and were not intended to end any litigation but were instead intended to prolong PEP's litigation against the defendants named in this action and because they have distorted the litigation positions of the parties by placing PEP in the dual role of original owner and last purchaser of the gas condensate alleged to have been stolen.
All of the defendants have filed motions to designate responsible third parties pursuant to §§ 33.004(a) and (j) of the Texas Civil Practices and Remedies Code. Because the only claims asserted against the following defendants are indirect, assigned claims that the court has already concluded PEP lacks standing to assert, the motions to designate responsible third parties urged by these defendants are moot: Plains (Docket Entry No. 121), Superior Crude (Docket Entry No. 124), High Sierra (Docket Entry No. 125), Murphy (Docket Entry No. 129), F & M Transportation (Docket Entry No. 130), and Big Star and Saint James (Docket Entry No. 132). Because PEP has alleged both direct and indirect, assigned claims against STUSCO, the motion to designate responsible third-parties urged by STUSCO and Shell Chemical is moot as to the indirect, assigned claims and live as to the direct claims. Accordingly, the live motions to designate responsible third parties are those urged by FR Midstream (Docket Entry No. 120), Shell Chemical and STUSCO (Docket Entry No. 123), and Sunoco, ConocoPhillips, and Marathon (Docket Entry No. 127).
Defendants seek leave to designate responsible third parties under the Texas proportionate responsibility scheme contained in Chapter 33 of the Texas Civil Practices and Remedies Code. With certain express exceptions not relevant here, Chapter 33 applies to all common law torts and to statutory torts that do not include a separate and conflicting legislative fault-allocation scheme. Tex. Civ. Prac. & Rem. Code § 33.002; JCW Electronics, Inc. v. Garza, 257 S.W.3d 701, 704-06 (Tex.2008).
Tex. Civ. Prac. & Rem. Code § 33.011(6). Responsible third parties are not limited to those who can be joined as parties to the litigation. Responsible third parties may be persons or entities outside the court's jurisdiction, unable to be sued by the plaintiff, or even unknown. See In re Unitec Elevator Services Co., 178 S.W.3d 53, 58 n. 5 (Tex.App.-Houston [1st Dist.] 2005, no pet.). See also Tex. Civ. Prac. & Rem. Code §§ 33.004(j)-(k).
Once a defendant has moved for leave to designate responsible third parties plaintiffs may object. Tex. Civ. Prac. & Rem. Code § 33.004(f). To successfully prevent designation of a responsible third party, the burden is on the plaintiffs to establish that "(1) the defendant did not plead sufficient facts concerning the alleged responsibility of the [third party] to satisfy the pleading requirement of the Texas Rules of Civil Procedure; and (2) after having been granted leave to replead, the defendant failed to plead sufficient facts concerning the alleged responsibility ..." Tex. Civ. Prac. & Rem. Code § 33.004(g).
A court's grant of a motion for leave to designate a responsible third party at this stage in the litigation does not preclude a party from later challenging the designation. After adequate time for discovery, "a party may move to strike the designation of a responsible third party on
FR Midstream Transport LP seeks to designate as responsible third-parties 106 different entities and/or individuals, 147 Known Traffickers, 48 Known Detainees, and 26 Accused Parties, as well as unspecified numbers of unknown traffickers, criminals, and Mexican government officials and customs agents. In support of its motion to designate responsible third parties, FR Midstream cites PEP documents, documents from the Mexican government, PEP's witnesses, PEP's disclosures, as well as pleadings and discovery materials from the BASF litigation, Civil Action No. 4:12-cv-1997.
Shell Chemical and STUSCO seek to designate as responsible third-parties 106 different entities and/or individuals, as well as unspecified numbers of known and unknown traffickers, unknown criminals, and unknown Mexican government officials and customs agents. In support of their motion to designate responsible third-parties, Shell Chemical and STUSCO cite "PEP's Complaints in this case and the BASF case, documents produced by PEP and other Pemex documents, documents produced by Defendants and third parties, reports and documents from the Mexican government, and PEP and other witnesses' testimony."
Sunoco, ConocoPhillips, and Marathon seek to designate as responsible third-parties PEP and its other subsidiaries, as well as various third-parties alleged to have stolen, smuggled, transported, distributed,
Sunoco, ConocoPhillips, and Marathon explain that
PEP argues that the motions to designate responsible third parties should be denied because they each suffer from procedural deficiencies.
PEP further argues that
In addition PEP argues that the
PEP's argument that the pending motions are deficient because they do not demonstrate how the parties they seek to designate as responsible third-parties caused FR Midstream, Shell Chemical and STUSCO, Sunoco, ConocoPhillips, and Marathon to purchase stolen gas condensate lacks merit because Chapter 33 of the Texas Civil Practices & Remedies Code § 33.011(6) defines "[r]esponsible third party" as "any person who is alleged to have caused or contributed to causing in any way the harm for which recovery of damages is sought." Accordingly, defendants only need to plead facts capable of showing how the third-parties they seek to designate as responsible third-parties caused or contributed to PEP's alleged injury, not to their own conduct. Defendants allege, and PEP does not deny, that PEP's pleadings, disclosures, and discovery responses identify the parties that they seek to designate as responsible third-parties as parties who caused or contributed to PEP's injuries. These allegations are sufficient at this early stage of the case to satisfy the pleading requirements for designating responsible third parties.
PEP's contention that the defendants improperly seek to designate as responsible third parties certain individuals who are already defendants, cross-defendants, or settling persons in this case is similarly without merit because none of the named individuals are defendants, cross-defendants, or settling parties in this action. Because the court concludes that PEP's arguments that the motions to designate responsible third parties urged by FR Midstream, Shell Chemical and STUSCO, Sunoco, ConocoPhillips, and Marathon should be denied because they suffer from "procedural deficiencies" lack merit, the live motions to designate responsible third parties urged by these defendants will be granted.
For the reasons explained in § II, above, the court concludes that PEP lacks standing to assert the indirect, assigned claims for fraud, breach of contract, and breach of warranty alleged in PEP's Original Complaint (Docket Entry No. 1). Accordingly, Plains Marketing, L.P.'s Motion to Dismiss (Docket Entry No. 12) is
For the reasons explained in § III, above, the court concludes that the motions to designate responsible third-parties
