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Pathfinder Aviation, Inc. v. XTO Energy Inc.

United States District Court, D. Alaska

May 4, 2016



H. Russel Holland United States District Judge.

Motion to Dismiss

Defendants move to dismiss plaintiff’s negligent misrepresentation and UTPA claims and to strike plaintiff’s prayer for punitive damages.[1] This motion is opposed.[2] Oral argument was not requested and is not deemed necessary.


Plaintiff is Pathfinder Aviation, Inc. Defendants are XTO Energy Inc. and Scott Griffith.

Plaintiff “is a Homer-based provider of helicopter services and logistical support..., providing services to the oil and gas, mining and construction industries.”[3] Michael and Mary Fell are plaintiff’s owners and Michael Fell (“Fell”) is the president of plaintiff.[4]

“XTO is a subsidiary of ExxonMobil.... Its Alaska Operations focused on oil production in the Cook Inlet....”[5] During the time at issue in this case, “Griffith served as the production superintendent for the Alaska Operations division of XTO.”[6]

Plaintiff alleges that “[o]n June 4, 2014, XTO reached out to Pathfinder to explore the possibility of hiring [Pathfinder] to support its Alaskan operations because it was not happy with its current provider of transportation services.”[7] Plaintiff alleges that in January 2015, “Fell and Griffith met ... to discuss the acquisition of a specific helicopter airframe that met XTO’s particular contract requirements: An Airbus EC135P2....”[8]Plaintiff further alleges that “[t]hereafter, XTO’s aviation management team met with Pathfinder to perform a ‘gap analysis’ of Pathfinder’s assets and services, after which XTO determined that Pathfinder qualified as an acceptable vendor.”[9]

Plaintiff alleges that “[o]n February 25, 2015, Griffith and Fell had a telephone conversation wherein Griffith announced that Pathfinder had been awarded the contract and would be XTO’s transportation services provider.”[10] Plaintiff alleges that Griffith sent Fell a follow-up email, in which Griffith stated that “XTO Energy has made the decision to go with Pathfinder Aviation as our helicopter support contractor for our Alaska Operations. I will begin working immediately to put the contract together under the terms we have discussed.”[11] Plaintiff alleges that as of February 25, 2015, the parties had agreed upon the length of the contract (10 years), the effective date of the contract (September 1, 2015), and the price plaintiff would be paid for its services ($176, 636 per month, plus $1, 100 per flight hour).[12] Plaintiff alleges that “[t]he February 25, 2015 email also included details regarding a start-up fee of $50, 000 and a termination clause.”[13] “The February 25, 2015 email also confirmed that XTO Energy planned to enter into an additional agreement with Pathfinder whereby if the primary helicopter - the Airbus EC - was taken off the XTO contract in support of other aviation clientele or for repairs and maintenance, XTO would pay for the use of a twin-engine Bell 212 helicopter for backup, up to the first 12 months of the contract.”[14] And, plaintiff alleges that “[t]he February 25, 2015 email further indicated that XTO was about to notify its then-current helicopter provider, ERA Helicopters, that it would be terminating its contract and ‘going in another direction.’”[15]

Plaintiff alleges that “[a]fter the February 25, 2015 confirmation email and over the course of the spring 2015, [it] worked to acquire the additional aircraft and to arrange for [the] modifications to conform to XTO’s operation guidelines.”[16] Plaintiff further alleges that it “purchased ground support equipment, helicopter support equipment, and devoted hundreds of labor hours into ensuring that [its] personnel and equipment complied with XTO’s requirements and needs.”[17] Plaintiff alleges that it expended over $400, 000 on this equipment and preliminary work.[18]

Plaintiff alleges that “[o]ver the course of spring 2015, Fell and Griffith worked together on minor remaining details of the contract between XTO and Pathfinder.”[19]Plaintiff further alleges that “Griffith continually communicated to Fell that there was an enforceable and binding contract in place[.]”[20] Plaintiff alleges that these communications included a March 23, 2015 email, an April 30, 2015 email, and numerous verbal conversa-tions.[21] Plaintiff alleges that in the March 23, 2015 email, Griffith “made clear that there was a binding contract in place with the use of quotations” and that in the April 30, 2015 email, Griffith “reiterat[ed] the existence of a ‘ten year contract[.]’”[22]

Plaintiff alleges that despite Griffith’s representation in the February 25, 2015 email that he would put the contract together immediately, “XTO delayed in signing the actual written contract.”[23] Plaintiff alleges that Griffith finally emailed the written contract to Pathfinder on May 8, 2015 for Pathfinder’s signature.[24] But, plaintiff alleges that Griffith never signed the written contract.[25]

Plaintiff alleges that while it “was diligently working on building the infrastructure needed to perform under the contract, XTO was in active negotiations with Hilcorp Energy, Inc. (‘Hilcorp’) regarding the sale of all of XTO’s assets in Alaska[.]”[26] Plaintiff believes that XTO began discussions with Hilcorp in late 2014.[27] Plaintiff alleges that “XTO made a concerted effort not to make these negotiations public, and actively hid these negotiations from Pathfinder because it wanted Pathfinder to continue to build the infrastructure needed to support the transportation services contract in the event the sale with Hilcorp fell through....”[28]

Plaintiff alleges that “[b]ecause [it] was unaware that XTO was considering a sale to Hilcorp, it continued to work on putting the necessary equipment in place to support the contract, including the purchase of a Bell 212 helicopter for over $1.2 million.”[29] Plaintiff further alleges that it “also located an Airbus EC that met XTO’s standards and requirements with a purchase price of over $3.5 million.”[30]

Plaintiff alleges that

[j]ust prior to purchasing the Airbus EC, Fell received a call from a Hilcorp representative ... who was close to the negotiations between Hilcorp and XTO.... While the Hilcorp representative did not inform Fell that Hilcorp was about to purchase XTO, he did instruct Fell to be very careful when dealing with XTO and committing resources to Pathfinder’s contract with XTO. The Hilcorp Representative hinted that Fell needed to ...

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