U.S. Magistrate Judge Kathleen Kay in local federal court has ruled that the Lake Charles Harbor and Terminal District owes as yet undetermined treble (triple) damages to Infrastructure Funding Group (IFG) Port Holdings LLC because of a breach of contract.
IFG filed its suit against the port Jan. 29, 2016, which involves a grain export terminal that it opened for business July 15, 2015, at a cost of over $50 million, according to IFG.
The judge's ruling said the port did not secure the necessary permits that would have allowed IFG to dredge a portion of Contraband Bayou to the contract's designated depth prior to export terminal opening at City Docks.
Kay issued the ruling July 31, which states that "formal judgement will be signed when the appropriate damages (to which the judge said IFG is entitled) have been calculated and attorney fees and costs (are) determined."
John Ringo, the port's legal counsel, said the ruling is under review.
"It was adverse to the port," he said. "We're looking at all of our options."
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 ruling found the port as being responsible for having Contraband Bayou ready to be dredged by IFG to the desired depth before the export terminal was fully operational. Under the contract with the port and IFG, the port was required to secure appropriate permitting through the U.S. Army Corps of Engineers and "proper assurance of slope stability along the proposed dredging area."
"Accordingly, we find the port 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.
The ruling also found 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.
It adds, "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 made some counterclaims, but the judge said, "Given our findings above with respect to the claims of IFG, these counterclaims will be denied and dismissed with prejudice."