U.S. District Court Magistrate Judge Kathleen Kay ruled Monday that the Lake Charles Harbor and Terminal District owes Infrastructure Funding Group (IFG) Port Holdings LLC $124,531,652 in damages because of a breach of contract stemming from a more than decade-old contract dispute.

IFG filed suit against the port in late January 2016. Kay ruled in late July 2020 that the port owed IFG triple damages related to a more than $50 million grain export terminal IFG opened in July 2015. Her ruling stated the port did not secure the permits needed to let IFG dredge part of Contraband Bayou to the contract’s desired depths before the terminal opened at City Docks.

Monday’s ruling follows IFG’s calculation of damages, along with attorney fees and costs. Port Director Richert Self issued a statement Wednesday, saying the port “intends to file a new motion for a new trial.” If Judge Kay denies the motion, the port “will appeal the judgement” before the 5th Circuit Court of Appeals, he said.
“We have new leadership in place,” Self said. “We look forward to the day when we can put this litigation behind us and focus our attention on rebuilding and growing the port for the betterment of Southwest Louisiana.”

Kay’s recent ruling also states that IFG “was not in default of its lease” with the port, and the Sept. 30, 2015, default notice issued by the port “is declared null, void and of no effect.” The port has seven days within the final judgment being entered to withdraw the default notice and provide proof to IFG.

A letter of intent executed in 2008 by IFG and the port stated IFG wanted to “develop an export grain terminal that would use Berth 8 located at the port’s City Docks for loading ships for export.”

The July 2020 ruling held the port responsible for making sure Contraband Bayou was ready to be dredged by IFG to the desired depth before the export terminal was operational. Under the contract with the port and IFG, the port had to secure appropriate permitting through the U.S. Army Corps of Engineers and “proper assurance of slope stability along the proposed dredging area.”

The port was found “liable to IFG for losses attributable to IFG’s inability to market itself as a fully operational terminal and to load larger, deeper draft cargo vessels as was intended by its original business plan,” the ruling reads. It also stated that IFG “suffered ascertainable loss of money as a result of the port’s use of unfair and deceptive methods, acts and practices.”

“We believe these unscrupulous activities were engaged in purposely by the port to cause IFG to abandon its project and leave the Port of Lake Charles,” the ruling reads. “If the port had simply behaved as a responsible business entity and worked with IFG (as IFG showed a willingness to do) to address the permitting problem quickly, these issues could have been resolved much sooner than they were…”

The port in October 2020 requested Kay’s decision be reheard by a different U.S. District Court judge. The motion stated that Kay’s longstanding personal relationship with William B. Monk, IFG’s lead counsel, was not discovered until after she made her ruling. That motion was denied in January 2021. U.S. District Judge Patricia Minaldi and Kay were originally set to hear the case, but Minaldi took leave of absence from the bench in 2017.