Gulf Valve Services Company, LLC has filed a lawsuit against Baker Hughes Energy Services, LLC, accusing the latter of breaching a longstanding business relationship and failing to conduct necessary audits that are crucial for Gulf Valve's operations. The complaint was lodged in the United States District Court for the Middle District of Louisiana on October 2, 2024. Gulf Valve is seeking both injunctive relief and damages from Baker Hughes.
Gulf Valve, a Baton Rouge-based company specializing in assembling and distributing safety valves, has been in business with Baker Hughes for over five decades. Their partnership was formalized through an Authorized Sales Channel Master Agreement signed on May 19, 2021, which allowed Gulf Valve to purchase and assemble products from Baker Hughes. This agreement was set to expire on May 31, 2024. According to Gulf Valve's complaint, Baker Hughes abruptly decided not to renew this agreement without any prior warning or explanation. This decision came as a shock to Gulf Valve, which had never faced such non-renewal in their long-standing relationship.
The crux of the dispute lies in the annual audits that Baker Hughes is required to perform according to industry standards. These audits are essential for Gulf Valve to certify its inventory of safety valves for sale. Without these certifications, Gulf Valve cannot legally sell its products beyond 2024. Despite having a large inventory valued at over $25 million, Gulf Valve finds itself unable to sell these products due to Baker Hughes' failure to conduct the necessary audits scheduled for September 17, 2024.
Gulf Valve argues that this failure constitutes a breach of contract and violates both Louisiana and New York laws regarding good faith and fair dealing. They further allege that Baker Hughes' actions amount to unfair trade practices under Louisiana law. The plaintiff is seeking preliminary and permanent injunctive relief requiring Baker Hughes to continue conducting annual audits until all existing inventory is sold. Alternatively, they seek compensatory damages for loss of use and profits, along with attorney fees and other associated costs.
Representing Gulf Valve are attorneys J. Alan Harrell, Brad M. Boudreaux, Anthony J. Gambino Jr., Nena M. Eddy from Phelps Dunbar LLP in Baton Rouge and Blake C. Donewar from New Orleans. The case has been assigned Case ID: 3:24-cv-00822-BAJ-EWD but does not yet list specific judges overseeing it.