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Macquarie Bank Limited and Macquarie Americas Corp v. Bradley D. Knickel; Lexmac Energy

March 15, 2011

MACQUARIE BANK LIMITED AND MACQUARIE AMERICAS CORP., PLAINTIFFS AND COUNTER DEFENDANTS,
v.
BRADLEY D. KNICKEL; LEXMAC ENERGY, L.P.; LEXAR ENERGY, INC.;NOVUS OPERATING COMPANY, L.P.; KHL, INC.; AND MINERAL LAND SERVICES, INC.,
DEFENDANTS, COUNTER CLAIMANTS, AND
THIRD-PARTY PLAINTIFFS,
v.
MACQUARIE BARNETT, LLC, THIRD-PARTY DEFENDANT.



The opinion of the court was delivered by: Daniel L. Hovland, District Judge United States District Court

ORDER

Before the Court is the Counter Claimants and Third-Party Plaintiffs' "Motion for Leave to Amend Counterclaims" filed on January 7, 2011. See Docket No. 172. The Counter Defendant and Third-Party Defendant filed a response in opposition to the motion on January 24, 2011. See Docket No. 178. The Counter Claimants and Third-Party Plaintiffs filed a reply brief on February 3, 2011. See Docket No. 182. The Counter Defendant and Third-Party Defendant filed a sur-reply on February 9, 2011. See Docket No. 191. The Counter Claimants and Third-Party Plaintiffs filed a response to the sur-reply on February 16, 2011. See Docket No. 195. For the reasons stated below, the motion is granted in part and denied in part.

Also before the Court is the Counter Claimants and Third-Party Plaintiffs' "Motion for Leave to Designate Retained Industry Expert and Motion for Reconsideration on Court's December 17, 2010 Ruling on the Admissibility of the Sproule Report" filed on January 7, 2011. See Docket No. 174. The Counter Defendant and Third-Party Defendant filed a response in opposition to the motion on January 24, 2011. See Docket No. 179. The Counter Claimants and Third-Party Plaintiffs filed a reply brief on February 3, 2011. See Docket No. 183. For the reasons stated below, the motion is denied.

I. BACKGROUND

Macaqurie Bank and Macquarie Barnett (collectively "Macquarie") were the original plaintiffs in this action. After the Court's Order of June 30, 2010, the only remaining claims are the defendants' counterclaims for misappropriation and misuse of confidential and proprietary information, conspiracy, breach of duty of good faith and fair dealing, and alter-ego. See Docket No. 137. Each of the remaining claims is premised on Macquarie's alleged misappropriation and misuse of confidential information.

On August 20, 2010, Lexar Energy, Inc., Novus Operating Company, LP, and LexMac Energy, L.P. (collectively "Lexar"), filed a "Motion to Determine Admissibility of Damages Testimony, and in the Alternative, Motion for Leave to Designate Non-Retained Testifying Experts." See Docket No. 148. On September 13, 2010 Macquarie filed a "Motion for Further Summary Judgment Ruling." See Docket No. 152. Oral argument on the motions was held in Bismarck, North Dakota on December 6, 2010. During that hearing, the Court made the following statement:

Of course, aren't the recoverable damages primarily one of unjust enrichment? I know they didn't plead that and they haven't revealed that in their Rule 26 disclosures, but essentially, I mean, those are the damages that remain, are one of whether the bank -- whether Macquarie Barnett was unjustly enriched as a result of acquiring this confidential information, if the jury concludes that they did acquire See Docket No. 179-1, p. 12. The Court also commented at the close of the hearing, "I see this as a case where there are some potentially recoverable damages in the form of unjust enrichment or how the plaintiff, Macquarie Bank, Macquarie Barnett, may have unjustly benefited from its actions." See Docket No. 179-1, p. 47. The Court also expressed its intention to "keep this case simple and condensed." See Docket No. 179-1, p. 49.

On December 17, 2010, the Court issued an order granting in part and denying in part Lexar's motion and denying Macquarie's motion. See Docket No. 171. In that order, the Court explained the measure of damages for the remaining claims, "In light of the remaining claims, the Court would note that the recoverable damages in this case will, as a general rule, be the amount of monies, if any, the Plaintiffs [Macquarie] were unjustly enriched or unjustly gained from their actions, and any other actual losses sustained by the Defendants." See Docket No. 171, p. 7. The Court commented further:

Simply stated, the recoverable damages for the claims which remain in this litigation are essentially damages for unjust enrichment, or for the value of the benefits, profits, or advantages gained by Macquarie as a result of any misappropriation and misuse of confidential and proprietary information. Recoverable damages may also include any actual losses sustained by the injured party or parties.

See Docket No. 171, p. 11.

On January 7, 2011, Lexar filed a motion to amend the counterclaim. See Docket No. 172. Lexar seeks to make additions to the facts in its counterclaim, add references to the North Dakota Uniform Trade Secrets Act and Texas law, clarify the damages being sought for misappropriation and misuse of confidential and trade secret information, and add claims for unjust enrichment and exemplary damages. See Docket Nos. 172 and 172-1. Lexar contends its proposed amendments are in keeping with the Court's December 17, 2010 order. Macquarie contends that justice does not require the Court to permit the proposed amendments so late in the litigation.

On January 7, 2011, Lexar also filed a motion for leave to designate an expert witness and for reconsideration of the portion of the Court's December 17, 2010 order that denied Lexar's motion to admit the report written by Sproule Associates Inc. ("the Sproule Report"). See Docket No. 174. Lexar contends that the Court's December 17, 2010 order "again changed the landscape of this case. . . ." See Docket No. 175. Lexar argues that an expert witness is necessary to testify concerning damages. Lexar also contends that the Sproule Report is relevant to the types of damages the Court described in its December 17, 2010 order. Macquarie contends that the deadline to disclose an expert witness was July 1, 2009, and that justice does not require an exception to that deadline. Macquarie also contends that the Court properly excluded the Sproule Report. In essence, Lexar seeks leave to (1) add a claim for unjust enrichment, (2) add a claim for exemplary damages, and (3) to clarify and add specificity to their remaining counterclaims.

II. LEGAL DISCUSSION

A. MOTION FOR LEAVE TO AMEND THE ...


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