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CAUSE NO. 2016-63859
RANDALL WHITNEY D/B/A
TITAN TECHNICAL TRAINING IN THE DISTRICT COURT OF
Plaintiff,
HARRIS COUNTY, TEXAS
ROWAN COMPANIES, INC JUDICIAL DISTRICT
Defendant
ROWAN COMPANIES, INC.
IN THE DISTRICT COURT OF
Counter Claimant
HARRIS COUNTY, TEXAS
RANDALL WHITNEY, J.P. MOOK and
TOM WOLFE JUDICIAL DISTRICT
Counter Defendants.
DEFENDANT ROWAN COMPANIES, INC.’S FOURTH AMENDED ANSWER
TO SECOND AMENDED PETITION, PLEA TO THE JURISDICTION,
SPECIAL EXCEPTIONS, AFFIRMATIVE DEFENSES
COUNTER CLAIMS & THIRD PARTY CLAIMS
Defendant Rowan Companies, Inc. (“1 wan”) submits its Fourth Amended Answer to
Plaintiff’ s Second Amended Petition (“Petition”), and respectfully states as follows:
GENERAL DENIAL
Pursuant
to Tex. R. Civ. P. 92, Rowan generally denies the allegations in the
Petition and demands strict proof thereof.
Rowan reserves
the right to amend
or supplement its Answer.
821739.2
PLEA TO THE JURISDICTION
Plaintiff’
s lack of standing
may be challenged through
a plea to the jurisdiction or
other procedural devices. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000).
Plaintiff lacks standing because he is an individual (Second Amended Petition §] 1.1) and was not
a party to any contract or agreement entered into between Titan Technical Training, LLC and
Rowan. Allen v. Wright, 468 U.S. 737, 751 (1984) (“Standing doctrine embraces several
judicially self imposed limits on the exercise of federal jurisdiction, such as the general
prohibition on a litigant’s raising another person’s legal rights”). A plaintiff must demonstrate
that “he, himself,” not a third party, suffered the injury. Heckman v. Williamson Cty., 369
S.W.3d 137, 150 (Tex. 2012). The cause of action “is vested in the corporation, as distinguished
from its stockholders, even though it may result indirectly in loss of eamings to the
stockholders.” Commonwealth of Mass. v. Davis, 140 Tex. 398, 407, 168 S.W.2d 216, 221
(1942).
SPECIAL EXCEPTIONS
Rowan specially excepts to Plaintiff’ s Second Amended Petition as follows:
Rowan specially excepts to Count D (Negligent Misrepresentation ff] 6.106.11),
as the facts pled in the Second Amended Petition fail to establish this cause of action. To the
contrary, the Second Amended Petition alleges that Defendant acted intentionally, which is
inconsistent with a theory of negligence.
Rowan specially excepts to Count D (Negligent Misrepresentation {| 6.106.11)
in that it fails to provide fair notice of (1) the particular misrepresentation at issue; (2) its falsity;
(3) the alleged failure to exercise ordinary care; and (4) pecuniary loss.
821739.2
Iv. AFFIRMATIVE AND OTHER DEFENSES
Without admitting the veracity or the merits of any of Plaintiff's allegations or claims,
Rowan asserts as follows:
Plaintiff's breach of contract claim is barred because Mook lacked Defendant’ s
authority to enter into a contractoral or otherwise with Plaintiff on Defendant's behalf
aintiff’s claims are barred by Plaintiff’s own conduct constituting fraud, fraud.
by non disclosure, and/or fraudulent inducement Defendant incorporates into this defense the
facts and allegations set out below in Rowan’s Counterclaims, Section VII, paragraphs 24, et.
seq,
Plaintiff’
s claims are barred by the statute of frauds.
Plaintiff’
s claims are barred by unclean
hands.
Plaintiff’ s claims are barred by illegality.
Plaintiff's claims are bared because Plaintiff failed to perform a condition
precedent Defendant incorporates into this defense the facts and allegations set out below in
Rowan’s Counterclaims, Section VII, paragraphs 24, et seq.
Plaintiff’
s claims are barred by prior material breach.
Plaintiff’
s claims are barred
by estoppel.
Plaintiff’
s claims are barred
by laches.
Plaintiff’s claims are barred by waiver.
Plaintiff’
s claims are barred
by consent.
Plaintiff’ s claims are barred by ratification.
Plaintiff’
s claims are barred by lack of good faith.
Plaintiff’s claims are barred
by his failureto mitigate damages.
Plaintiff’ s claims are barred by accord and satisfaction.
821739.2
Under Texas Civil Practices and Remedies Code Chapter 33, Plaintiff is
proportionately responsible for any damage he alleges to have suffered. Therefore, Plaintiff’s
claims are barred in whole or in part by his contributory fault.
COUNTERCLAIMS
Rowan complains of Randall Whitney, J.P. Mook, and Tom Wolfe (the
“Defendant Conspirators”), and further seeks disclosures from the newly named Defendant
Conspirators pursuant to Texas Rule of Civil Procedure 194. Rowan intends to conduct
discovery in accordance with Level 3.
ADDITIONAL PARTIES
John Patrick “J.P.” Mook is an individual and a resident and citizen of Texas.
Mook is the former Rowan Global Training Manager. He is also the step father of Randall
Whitney. Mr.Mook can be served at 2362314, Dayton, Texas 77535.
Thomas Greenberry Wolfe III is an individual and a resident and citizen of Texas.
Wolfe was a friend of J.P. Mook. Mook hired him as a Rowan employee. Mr.Wolfe can be
served at 630 Ames St., Spring, Texas 77373.
JURISDICTION AND VEN
This Court has jurisdiction over the Defendant Conspirators because they all have
continuous and systematic contacts with the State of Texas such that exercising jurisdiction does
not offend traditional notions of fair play and substantial justice.
Specifically, this Court has jurisdiction over the Defendant Conspirators because
they are residents of the State of Texas, Mook and Wolfe were employed by Rowan in Texas,
Whitney engaged in business with Rowan in Texas, and all of the Defendant Conspirators,
acting in concert, engaged in a pattem of tortious conduct within the State of Texas, including
acts and schemes involving Texas transactions and agreements.
821739.2
Venue is proper in Haris County, Texas because
a substantial part of the acts and.
omissions giving rise to the Counterclaims occurred in Haris County and because the
Defendant Conspirators made statements and representations to individuals and entities located
in Hanis Count
Rowan seeks damages in an amount within the jurisdictional requirements of this
court. Rowan seeks monelary relief of at least $1,094,965.70.
JURY DEMAND
Rowan demands trial by jury on its Counterclaims and has tendered the required
fee to the Court.
ACTUAL BACKGROUND
Whitney, Mook and Wolfe's Fraudulent Scheme to Defraud Rowan
Whitney, Mook and Wolfe conspired to defraud Rowan of over $1,500,000.
Through false statements, material omissions, and concealment of conflicts of interest, the
Defendant Conspirators caused Rowan to enter into a contract with a sham entity called “Titan
Technical Training, LLC,” and fraudulently billed Rowan in order to unjustly enrich themselves
at Rowan’s expense. The Defendant Conspirators successfully defrauded Rowan of
Pproximately $1,094,965.70 before their scheme was discovered and Rowan ceased paying
Titan’s fraudulent invoices.
Whitney Mook, and Wolfe Establish a Sham Entity and Cause It to Obtain a Lucrative
Contract with Rowan
Mook was hired as Rowan’s Global Training Manager in October 2012. In
January 2013, Mook hired Wolfe to serve under him as Technical Training Manager. Together,
Mook and Wolfe were responsible for developing and delivering specialized technical and safety
trainingto Rowan’s global oilfieldworkforce.
821739.2
On or around October 2013, Mook and Wolfe determined that they would hire
training contractors through staffing agencies to supplemental Rowan’s training department. In
late October 2013, Whitney who also happens to be Mook’s stepsonsubmitte d his resume to
one of these staffing agencies for consideration as a training contractor. Mook, Wolfe, and
Whitney quickly realized, however, that they could all profit off Rowan by creating a third party
training companywhich Whitney would “run andco _ niracting directly with Rowan.
Shortly thereafter, Mook, Wolfe, and Whitney created the so called “Titan
Technical Training, LLC” and misrepresented to Rowan that Whitney was Titan’s Chief
Operations Officer. Mook and Wolfe further misrepresented to Rowan that Titan was
experienced in proving specialized training on a global scale in areas including, but not limited
to, electrical, mechanical, fluid dynamics, and industry standards on matters such as safety and
the environment, and that Whitney had good standing in the oilfield services industry.
In truth, there was no “Titan Technical Training, LLC,” and Whitney had no
experience
in the technical training industry, must less experience
that would qualify him to train
Rowan’s global workforce. The purported “Titan Technical Training, LLC” had no customers,
no offices, and no employees. It was a sham entity used solely for the purpose of defrauding
Rowan.
In an effort to create the appearance that “Titan Technical Training, LLC” and
Whitney were legitimate, the Defendant Conspirators hid from Rowan the fact that Whitney wes
Mook’s stepson, and that Whitney and Mook owned real property together
and shared a joint
savings account.
As a direct result of their omissions, material misrepresentations, and othe
fraudulent actions, the Defendant Conspirators caused Rowan to enter into a contract with “Titan
821739.2
Technical Training, LLC” (entitled “Statement of Work for Rowan Companies, Inc.”) on or
about November 15, 2013, mere weeks after Whitney had submitted his resume to a staffing
agency for consideration. Plaintiff later claimed that, despite the existence of the Statement of
Work, which was executed by Plaintiff and Defendant’ s authorized representative, Plaintiff made
separate oral contract with Mook for the delivery of training services and construction of
training equipment
Mook had no authority
to enter into contracts on Defendant’
s behalf
By representing that (a) “Titan Technical Training, LLC” was an established
entity of good standing in the industry, (b) Whitney was an experienced oilfield trainer capable
of providing “specialized training” to Rowan’s global workforce, and (c) concealing the Mook
Whitney familial relationship, Mook and Wolfe abused their fiduciary duties to Rowan.
Whitney knowingly and willfully participated in and aided these breaches of fiduciary duties in
order to profit therefrom.
To further cover up and facilitate the fraud, Mook lied on his 2013 and 2014
Rowan Annual Conflicts of Interest Questionnaires and Certifications by giving false answers to
eleven of the fourteen questions asked. One example of Mook’s lies was his “ answer
to the
following question:
Since January 1, 2012, have you or any of your family members
or close friends, either on your or their own behalf or as a
shareholder, partner, director, officer, employee, consultant,
distributor, agent, or other representative of any other company or
entity, engaged in any transactions or other business dealings
with [Rowan], whether as a customer, supplier contractor,
subcontractor or otherwise?
The Conspirators Implement Their Scheme and Fraudulently Obtain $1,094,965.70 from
Rowan
By fraudulently deceiving Rowan into contracting with “Titan Technical
Training, LLC” the Defendant Conspirators laid the groundwork to put their scheme into action.
821739.2
Thereafter, the Defendant Conspirators implemented their fraud by causing Titan to submit
invoices to Rowan, which Mookin his capacity as Global Training Manager was authorized.
to approve
for payment. Mook claimed that he carefully reviewed each invoice to ensure that all
items billed had been performed
by Titan. In truth
and in fact, however, the invoices Mook
approved for payment routinely billed Rowan for work Titan had not performed, and consistently
evidenced abusive billing practices not provided for in the already favorable Statement of Work
that Mook had fraudulently shepherded through on Whitney’s behalf. For example, although the
Statement of Work provided that “course development” would be billed out at $1,200 per day, a
number of invoices billed “course development” at $1,450 per day.
The Defendant Conspirators also caused Titan to submit invoices with work
billed by fictitious employees. Mook approved these invoices for payment with full knowledge
that these “employees” did not exist. Given that Mook was authorized to approve invoices in his
capacity as Global Training Manager, Rowan reasonably relied on Mook’s statements and
representations that the invoices had been reviewed before being approved for payment. The
Defendant Conspirators knew they could abuse Mook’s invoice approving authority and submit
fraudulent invoices worth tens of thousands of dollars each without discovery.
Mook further misused his authority in order to (a) push out Rowan employees
© were competent and experienced in providing technical training, (b) artificially inflate
training budgetary forecasts; and (c) increase the monies that flowed from Rowan to Titan and
Whitney.
The Defendant Conspirators knowingly and willfully participated in and benefited
from that fraud by obtaining $1,094,965.70 from Rowan. At all times during this scheme, Mook
and Whitney shared a joint savings account, where portions of the funds Titan received from
821739.2
Rowan were deposited. Mook and Whitney also jointly owned a ten acre plot of land and used
funds received from Rowan to make improvements to the property and pay property taxes. For
his part in the scheme, Wolfe was compensated at least tens of thousands of dollars in cash that
Titan received from Rowan.
The defrauding of Rowan was not limited to monies paid directly to Titan. Mook
and Wolfe arranged for Rowan to provide Whitney and Titan with office space, equipment, and
transportation, both domestically and intemationally, at no charge. Mook also approved Titan
invoices billing Rowan for time spent training Titan’s un or under qualified instructors.
Defendant Conspirator Wolfe and his wife, who was also a Rowan employee,
were aware of Mook and Whitney’s relationship, but did not disclose this fact to anyone at
Rowan. When the fraud was uncovered, both Wolfe and his wife lied to Rowan’s investigative
team about this fact.
The Scheme Expands
Wolfe and Whitney, with Mook’s knowledge and participation, expanded the
scheme by devising and implementing a plan to steal Rowan’s property and then sell it back to
Rowan at an enommous markup.
While employed by Rowan, Wolfe constructed training equipment and simulators
out of parts that were Rowan’s property. Whitney/Titan paid Wolfe at least $62,430.75 for
constructing the training equipment and simulators, which Whitney/Titan had no ability to
construct on its own. Titan then sold these simulators back to Rowan by submitting fraudulent
invoices totaling $186,264.76.
The Conspirators C ontinue Their Fraud Even after Mook is Fired
On or about November, 30, 2015, Mook was terminated by Rowan for breach of
company policies/disciplinary violations, thus cutting off the essential aspect of the scheme
821739.2
Mook’s ability to approve Titan’s fraudulent invoices. At the time of Mook’s termination, Titan
had gotten approximately
six (6) months behind in submitting invoices to Rowan. In the days
following Mook’s termination, Whitney and Mookusing the name of the same fictitious
employee listed on many prior invoicessubmitted _ the six months’ worth of Titan invoices to
Rowan in an effort to defraud Rowan out of as much money as possible.
Almost immediately, Rowan flagged these and certain other large and
unsubstantiated Titan invoices. No one at Rowan was able to explain or account for the work
purportedly performed by Titan. Rowan began to investigate the legitimacy of the invoices. The
scheme was uncovered and Rowan immediately ceased paying the fraudulent Titan invoices that
had been submitted
but not yet paid.
Unaware that the scheme had been uncovered, Whitney attempted to obtain
payment on the remaining fraudulent invoices by enlisting Mook to write a letter on his/Titan’s
behalf
to Rowan. On or about January 30, 2016, Mook sent the letter to Rowan, under
the guise
being
a disinterested party. The letter materially omitted the fact that Whitney was Mook’s
stepson
and was filled with false statements, including, inter alia, that Titan had been hired after
a search of several companies that were competent to provide “specialized training” on a “global
basis,” and that Titan ultimately was chosen “based on the owner's good standing in the
industry.” In truth
and in fact, as Mook well knew, Titan Technical Training was a sham alter
ego for his stepson Whitney, who had no standing in the industry or qualifications to provide
“specialized” training
to Rowan’s global workforce.
After discovering the fraud, Rowan separately interviewed Wolfe and his wife. In
a continuing attempt to hide their participation in the scheme, the Wolfes both stated that they
were not aware of any familial connection between Mook and Whitney.
821739.2
The Wolfes were later separately interviewed a second time. Mr. Wolfe
continued to deny knowledge of the Whitney Mook relationship, even when confronted with
evidence thereof. However, Mrs. Wolfe recanted her prior denials and admitted that both she
and Mr. Wolfe had been aware that Mook was Whitney’s step father, and that they had never
disclosed this fact to anyone at Rowan.
After Mook wrote the fraudulent January 30, 2016 letter, he declined to be
interviewed
by Rowan. Whitney, however, agreed to be interviewed. In that interview Whitney
denied any financial or familial relationship with Mook.
Later in the interview Whitney was shown documents evidencing that he and
Mook owned real property together. Whitney admitted that he and Mook had purchased a ten
acre plot of land together, but he continued to deny any other relationship with Mook. Whitney
also failed to disclose the fact that he and Mook shared a joint savings account and that funds
received from Titan were used to make improvements
to, and pay taxes
on, their joint property.
Whitney was then shown documentation evidencing that he was named on
Mook’s car insurance policy. At this point, Whitney visibly reddened, announced that he was
leaving, and informed the interviewers that he would not be speaking to them further. Whitney
refused to answer any further questions and left the Rowan facility
COUNT ONE: COMMON LAW FRAUD AND FRAUDULENT INDUCEMENT
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
The Defendant Conspirators made material misrepresentations and omissions to
Rowan as part of a scheme to enrich themselves through improper and illegal methods.
821739.2
A few examples of the Defendant Conspirators’ misrepresentations and omissions
are that (a) Whitney was the Chief Operations Officer of a company called “Titan Technical
Training, LLC;” (b) “Titan Technical Training, LLC” was an established entity of good standing
in the industry; (c) Whitney was an experienced oilfield trainer capable of providing “specialized
training’ to Rowan’s global workforce; and (d) concealment of the Mook Whitney familial
relationship. The Defendant Conspirators also submitted fraudulent invoices for work that Titan
had never performed, overbilled for work Titan allegedly performed, and submitted invoices
with work billed by fictitious employees.
These and other false representations
and material omissions
were made by the
Defendant Conspirators who knew that the representations were false and the omissions were
material. The misrepresentations and omissions were made with the intent that they should be
acted upon
by Rowan. Rowan reasonably relied on these false representations and material
omissions by entering into a contract with the purported “Titan Technical Training, LLC” and
paying fake and inflated invoices totaling $1,094,965.70in good faith reliance thereon.
Due to the Defendant Conspirators’ fraud, Rowan has suffered damages for
which it is entitledto compensation
in an amount to be determined at trial. Rowan will likely
suffer additional losses as legal proceedings continue and for which it is entitled to recover
damages.
COUNT TWO: BREACH OF FIDUCIARY DUTY
(Mook and Wolfe)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
As employees of Rowan, Mook and Wolfe owed fiduciary duties to Rowan as a
matter
of law. These included, inter alia the duty of loyalty (to act in good faith and not allow
821739.2
personal interests
to prevail over those of their employer, Rowan) and the duty of care (to act and
perform corporate duties in the same manner as an ordinarily prudent person would under similar
circumstances). Mook and Wolfe therefore had the duty to fully disclose all material facts
relative to the existence and ownership of “Titan Technical Training, LLC,” to disclose the
Mook Whitney familial relationship, to avoid committing fraud against Rowan, to avoid self
dealing, and to truthfully answer their Rowan Annual Conflicts of Interest Questionnaires and
Certifications.
Mook and Wolfe breached their fiduciary duties by, inter alia, committing the
acts alleged above.
As a result of their breaches of fiduciary duties, Rowan has suffered damages for
which it is entitledto compensation
in an amount to be determined at trial. Rowan will likely
suffer additional losses as legal proceedings continue and for which it is entitled to recover
damages.
COUNT THREE: AIDING AND ABETTING FRAUD
AND BREACH OF FIDUCIARY DUTY
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
All of the Defendant Conspirators aided and abetted in the fraud and breaches of
fiduciary duty as set forth above in Counts One and Two, which are incorporated herein by
reference.
The Defendant Conspirators knew that Mook and Wolfe had fiduciary duties to
Rowan and yet they committed acts in furtherance of the fraud and breaches of those duties by
inter alia, making misrepresentations and concealing material facts as set forth above, and acting
in concert
with each other to achieve the objective of defrauding Rowan of at least $1,500,000.
821739.2
Due to the Defendant Conspirators’ unlawful acts, Rowan has suffered and
continues
to suffer harm, as well as economic and non economic damages, in an amount to be
determined at trial. The Defendant Conspirators’ conduct was willful, malicious, and fraudulent,
thereby entitling Rowan to exemplary damages.
COUNT FOUR: NEGLIGENCE AND GROSS NEGLIGENCE
(Mook and Wolfe)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
As Rowan employees, Mook and Wolfe each owed a duty to Rowan to act with
reasonable prudence. Each of them violated this duty when they committed the acts complained
of herein.
Mook and Wolfe’s acts, when viewed objectively, involved an extreme risk,
indeed the certainty
of risk, to Rowan. Specifically, they should have known that participating
in
a conspiracy to defraud Rowan of over $1,000,000 would result in extreme harm to Rowan.
Despite being aware of the risk, Mook and Wolfe proceeded with conscious indifference to the
welfare of Rowan.
As a result of Mook and Wolfe's negligence and gross negligence, Rowan has
suffered damages for which it is entitled to compensation in an amountto be determined
at trial.
Rowan will likely suffer additional losses as legal proceedings continue and for which it is
entitled to recover damages.
COUNT FIVE: NEGLIGENCE AND NEGLIGENT MISREPRESENTATION
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
821739.2
Whitney, Mook and Wolfe each owed a duty to Rowan to act as a reasonably
prudent person and use ordinary care to not engage in acts that would harm Rowan. The
Defendant Conspirators violated that duty by the fraudulent acts and omissions, breaches of
duty, and negligence set forth above.
Whitney, Mook and Wolfe acted negligently
and made materia
misrepresentations and omissions to Rowan in the course of business and in business
transactions. As a result of these acts and omissions, Rowan continued to justifiably rely on the
Defendant Conspirators to perform their employment duties and/or to conduct business fairly
and not to Rowan’
s detriment.
The Defendant Conspirators failed to exercise reasonable care in their actions
toward Rowan, and these negligent acts and omissions inflicted damages upon Rowan for which
it is entitled to compensation in an amount to be determined at trial. Rowan
will likely suffer
additional losses as legal proceedings continue and for which it is entitled to recover damages.
COUNT SIX: CIVIL CONSPIRACY
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
The Defendant Conspirators planned and acted in a concerted fashion amongst
themselves and with others in a conspiracy to defraud Rowan. Using Mook and Wolfe’s
positions of trust at Rowan, and a fraudulent scheme as set forth above, the Defendant
Conspirators conspired
to commit improper acts and engaged in a series of overt acts to carry out
the scheme to the detriment
of Rowan.
Due to the Defendant Conspirators’ concerted acts with each other, Rowan has
suffered damages for which it is entitled to compensation in an amountto be determined
at trial.
821739.2
Rowan will likely suffer additional losses as legal proceedings continue and for which it is
entitled to recover damages.
COUNT SEVEN: MONEY HAD AND RECEIVED/UN]
UST ENRICHMENT
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
The Defendant Conspirators secured money through fraud and by taking undue
advantage
of Rowan. That money, in equity and good conscience, belongs
to Rowan. Said
money includes approximately $1,094,965.70 obtained from Rowan as a result of the acts and
omissions, breaches of duty, and negligence alleged above.
The Defendant Conspirators should
be required,in equity and good conscience, to
tum over all the profits they made through their fraud, conspiracy, and/or breaches of duty
toward Rowan.
COUNT EIGHT: EXEMPLARY DAMAGES
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
The Defendant Conspirators’ conduct was willful, intentional and/or grossly
negligent. The Defendant Conspirators knew that their actions, including their
misrepresentations, omissions, and breaches of their fiduciary duties, were harmful to Rowan.
Nevertheless, they proceeded with conscious indifference toward Rowan.
The Defendant Conspirators, in the acts and conduct described above, also
engaged in intentional, deliberate, knowing and malicious conduct designed to deceive and
defraud Rowan. As a result they should be held accountable and subjected to
punitive/exemplary damages as provided for under Texas law.
821739.2
Therefore, Rowan seeks punitive and exemplary damages in an amount to be
determined
by a jury under Texas law. RAC ODE SEC
COUNT NINE: ATTORNEY’S FEES AND COSTS
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
Rowan is entitled to an award of its attomey’s fees, costs
of court, and expenses
pursuant
to Texas Law Rowan therefore seeks an award from the Defendant Conspirators of all
such attomey’s fees, costs
of court, and expenses incurred in this litigation.
COUNT TEN: PRE AND POST JUDGMENT INTEREST
All Defendant Conspirators
Rowan incorporates by reference the factual allegations above as if set forth fully
Rowan is entitled
to pre and post judgment interest pursuant to Texas Law.
Rowan therefore
seeks pre and post judgment interest from the Defendant Conspirators.
COUNT ELEVEN: SETOFF AND RECOUPMENT.
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
Rowan denies that it owes any money to the Defendant Conspirators due to their
wrongful actions and tortious conduct described herein. To the extent the Court finds that
Rowan owes the Defendant Conspirators any money, then pursuant to the doctrines of setoff and
recoupment Rowan demands to setoff that amount by the amount owed to Rowan by Defendant
Conspirators, including but not limited to the damages and other remedies awarded
in this case.
821739.2
COUNT TWELVE: FEE FORFEITURE AND DISGORGEMENT
All Defendant Conspirators
Rowan incorporates by reference
the factual allegations above as if set forth fully
As employees of Rowan, Mook and Wolfe owed fiduciary duties to Rowan as a
matter of law. Mook and Wolfe breached their fiduciary duties by, inter alia, failing to fully
disclose all material facts relative to the existence and ownership of “Titan Technical Training,
LLC,” failing to disclose the Mook Whitney familial relationship, failing to respond truthfully on
their Rowan Annual Conflicts of Interest Questionnaires and Certifications, and by conspiring to
defraud and. defrauding Rowan of over $1,000,000. Furthermore, the Defendant Conspirators
knew that Mook and Wolfe owed fiduciary duties to Rowan, and yet they aided and abetted in
the breaching of those duties and committed acts to defraud Rowan, including inter alia, making
misrepresentations
and concealing material facts as set forth above, and acting
in concert with
each other to achieve
the objective of defrauding Rowan
of at least $1,500,000.
The Defendant Conspirators’ breaches of fiduciary duties and acts of fraud were
clear and serious and significantly
harmed Rowan. The fees and profits collected
by the
Defendant Conspirators as a result of their breaches of fiduciary duties and acts of fraud should
therefore be forfeited and disgorged in an amount to be determined at trial.
COUNT THIRTEEN: CONSTRUCTIVE TRUST
All Defendant Conspirators
Rowan incorporates by reference
the factual allegations above as if set forth fully
Mook and Wolfe breached their fiduciary duties to and defrauded Rowan of over
000 by, inter alia , failing to fully disclose all material facts relative to the existence and
821739.2
ownership of “Titan Technical Training, LLC,” failing to disclose the Mook Whitney familial
relationship, and failing to respond truthfully on their Rowan Annual Conflicts of Interest
Questionnaires and Certifications. The Defendant Conspirators further aided and abetted in the
breaching of Mook and Wolfe's fiduciary duties and acted in concert with each other to achieve
the objective of defrauding Rowan of at least $1,500,000.
As aresult of the Defendant Conspirators’ breaches of fiduciary duties and acts of
fraud, the Defendant Conspirators were unjustly enriched
in excess of $1,000,000. Whitney and
Mook were also unjustly enriched through improvements to their jointly owned real property.
Rowan demands that a constructive trust be placed on the proceeds, funds,
and property
improvements obtained as a result of the Defendant Conspirators’ breaches of their fiduciary
duties
and acts of fraud.
COUNT FOURTEEN: RESCISSION
(All Defendant Conspirators)
Rowan incorporates by reference the factual allegations above as if set forth fully
herein.
Altematively, Rowan requests that the contract with Whitney/Titan be rescinded
and that Rowan be awarded consideration
paid, together with such further special damages and.
expenses incurred as a result of the fraudulent contract, which are necessary to restore Rowan to
its position before the fraudulent contract was entered into. Smith v. Nat’] Resort Commumities,
Inc., 585 S.W.2d 655, 660 (Tex. 1979).
The contract with Whitney/Titan was secured through fraud and Mook and
Wolfe's breaches of their fiduciary duties. Prior to uncovering the fraud, Rowan did not breach
the contract. As soon as Rowan uncovered the fraud, Rowan immediately stopped paying
Titan’s fraudulent invoices and teminated its relationship with Titan. Rowan is therefore
821739.2
entitled to rescission of the fraudulent contract to avoid the Defendant Conspirators’ unjust
enrichment.
VI. CONDITIONS PRECEDENT
All conditions precedent to Rowan’s counterclaims have been performed,
discharged or waived.
VII. TOLLING OF LIMITATIONS
To the extent that Mook, Wolfe, or Whitney raises the statute of limitations as a
defense, limitations were tolled based on the discovery nile, the doctrine of fraudulent
concealment, and the continuing tort doctrine.
VIII. PRAYER
Rowan prays that Plaintiff take nothing on its claims and that Rowan be granted
Judgment in its favor on all Counterclaims and be awarded the following against the Defendant
Conspirators:
Damages on its Counterclaims;
Attomey’s
fees and expenses; and
All other relief to which Rowan may be entitled at law and in equity.
821739.2
Respectfully submitted,
MYSER APLAN ESELKA L.L.P.
By:__/s/David Isaak
David Isaak
State Bar No. 24012887
acquelyn R. Rex
State Bar No. 24098317
700 Louisiana, Suite 2300
Houston, Texas 77002
Telephone: (713) 221 2300
Facsimile: (713) 221 2320
disaak@skv.com.
jrex@skv.com
ATTORNEYS FOR DEFENDANT/
COUNTER PLAINTIFF
ROWAN COMPANIES, INC
CERTIFICATE OF SERVI
T hereby certify that a true and correct copy of the foregoing instrument was served on all
counsel of record and on Third Party Defendant J.P. Mook, pro se, via email and/or the Coutt’s
CM/ECF filing systemFebruary 2
/s/ David Isaak
David Isaak
821739.2
Preview
CAUSE NO. 2016-63859 RANDALL WHITNEY D/B/A TITAN TECHNICAL TRAINING IN THE DISTRICT COURT OF Plaintiff, HARRIS COUNTY, TEXAS ROWAN COMPANIES, INC JUDICIAL DISTRICT Defendant ROWAN COMPANIES, INC. IN THE DISTRICT COURT OF Counter Claimant HARRIS COUNTY, TEXAS RANDALL WHITNEY, J.P. MOOK and TOM WOLFE JUDICIAL DISTRICT Counter Defendants. DEFENDANT ROWAN COMPANIES, INC.’S FOURTH AMENDED ANSWER TO SECOND AMENDED PETITION, PLEA TO THE JURISDICTION, SPECIAL EXCEPTIONS, AFFIRMATIVE DEFENSES COUNTER CLAIMS & THIRD PARTY CLAIMS Defendant Rowan Companies, Inc. (“1 wan”) submits its Fourth Amended Answer to Plaintiff’ s Second Amended Petition (“Petition”), and respectfully states as follows: GENERAL DENIAL Pursuant to Tex. R. Civ. P. 92, Rowan generally denies the allegations in the Petition and demands strict proof thereof. Rowan reserves the right to amend or supplement its Answer. 821739.2 PLEA TO THE JURISDICTION Plaintiff’ s lack of standing may be challenged through a plea to the jurisdiction or other procedural devices. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000). Plaintiff lacks standing because he is an individual (Second Amended Petition §] 1.1) and was not a party to any contract or agreement entered into between Titan Technical Training, LLC and Rowan. Allen v. Wright, 468 U.S. 737, 751 (1984) (“Standing doctrine embraces several judicially self imposed limits on the exercise of federal jurisdiction, such as the general prohibition on a litigant’s raising another person’s legal rights”). A plaintiff must demonstrate that “he, himself,” not a third party, suffered the injury. Heckman v. Williamson Cty., 369 S.W.3d 137, 150 (Tex. 2012). The cause of action “is vested in the corporation, as distinguished from its stockholders, even though it may result indirectly in loss of eamings to the stockholders.” Commonwealth of Mass. v. Davis, 140 Tex. 398, 407, 168 S.W.2d 216, 221 (1942). SPECIAL EXCEPTIONS Rowan specially excepts to Plaintiff’ s Second Amended Petition as follows: Rowan specially excepts to Count D (Negligent Misrepresentation ff] 6.106.11), as the facts pled in the Second Amended Petition fail to establish this cause of action. To the contrary, the Second Amended Petition alleges that Defendant acted intentionally, which is inconsistent with a theory of negligence. Rowan specially excepts to Count D (Negligent Misrepresentation {| 6.106.11) in that it fails to provide fair notice of (1) the particular misrepresentation at issue; (2) its falsity; (3) the alleged failure to exercise ordinary care; and (4) pecuniary loss. 821739.2 Iv. AFFIRMATIVE AND OTHER DEFENSES Without admitting the veracity or the merits of any of Plaintiff's allegations or claims, Rowan asserts as follows: Plaintiff's breach of contract claim is barred because Mook lacked Defendant’ s authority to enter into a contractoral or otherwise with Plaintiff on Defendant's behalf aintiff’s claims are barred by Plaintiff’s own conduct constituting fraud, fraud. by non disclosure, and/or fraudulent inducement Defendant incorporates into this defense the facts and allegations set out below in Rowan’s Counterclaims, Section VII, paragraphs 24, et. seq, Plaintiff’ s claims are barred by the statute of frauds. Plaintiff’ s claims are barred by unclean hands. Plaintiff’ s claims are barred by illegality. Plaintiff's claims are bared because Plaintiff failed to perform a condition precedent Defendant incorporates into this defense the facts and allegations set out below in Rowan’s Counterclaims, Section VII, paragraphs 24, et seq. Plaintiff’ s claims are barred by prior material breach. Plaintiff’ s claims are barred by estoppel. Plaintiff’ s claims are barred by laches. Plaintiff’s claims are barred by waiver. Plaintiff’ s claims are barred by consent. Plaintiff’ s claims are barred by ratification. Plaintiff’ s claims are barred by lack of good faith. Plaintiff’s claims are barred by his failureto mitigate damages. Plaintiff’ s claims are barred by accord and satisfaction. 821739.2 Under Texas Civil Practices and Remedies Code Chapter 33, Plaintiff is proportionately responsible for any damage he alleges to have suffered. Therefore, Plaintiff’s claims are barred in whole or in part by his contributory fault. COUNTERCLAIMS Rowan complains of Randall Whitney, J.P. Mook, and Tom Wolfe (the “Defendant Conspirators”), and further seeks disclosures from the newly named Defendant Conspirators pursuant to Texas Rule of Civil Procedure 194. Rowan intends to conduct discovery in accordance with Level 3. ADDITIONAL PARTIES John Patrick “J.P.” Mook is an individual and a resident and citizen of Texas. Mook is the former Rowan Global Training Manager. He is also the step father of Randall Whitney. Mr.Mook can be served at 2362314, Dayton, Texas 77535. Thomas Greenberry Wolfe III is an individual and a resident and citizen of Texas. Wolfe was a friend of J.P. Mook. Mook hired him as a Rowan employee. Mr.Wolfe can be served at 630 Ames St., Spring, Texas 77373. JURISDICTION AND VEN This Court has jurisdiction over the Defendant Conspirators because they all have continuous and systematic contacts with the State of Texas such that exercising jurisdiction does not offend traditional notions of fair play and substantial justice. Specifically, this Court has jurisdiction over the Defendant Conspirators because they are residents of the State of Texas, Mook and Wolfe were employed by Rowan in Texas, Whitney engaged in business with Rowan in Texas, and all of the Defendant Conspirators, acting in concert, engaged in a pattem of tortious conduct within the State of Texas, including acts and schemes involving Texas transactions and agreements. 821739.2 Venue is proper in Haris County, Texas because a substantial part of the acts and. omissions giving rise to the Counterclaims occurred in Haris County and because the Defendant Conspirators made statements and representations to individuals and entities located in Hanis Count Rowan seeks damages in an amount within the jurisdictional requirements of this court. Rowan seeks monelary relief of at least $1,094,965.70. JURY DEMAND Rowan demands trial by jury on its Counterclaims and has tendered the required fee to the Court. ACTUAL BACKGROUND Whitney, Mook and Wolfe's Fraudulent Scheme to Defraud Rowan Whitney, Mook and Wolfe conspired to defraud Rowan of over $1,500,000. Through false statements, material omissions, and concealment of conflicts of interest, the Defendant Conspirators caused Rowan to enter into a contract with a sham entity called “Titan Technical Training, LLC,” and fraudulently billed Rowan in order to unjustly enrich themselves at Rowan’s expense. The Defendant Conspirators successfully defrauded Rowan of Pproximately $1,094,965.70 before their scheme was discovered and Rowan ceased paying Titan’s fraudulent invoices. Whitney Mook, and Wolfe Establish a Sham Entity and Cause It to Obtain a Lucrative Contract with Rowan Mook was hired as Rowan’s Global Training Manager in October 2012. In January 2013, Mook hired Wolfe to serve under him as Technical Training Manager. Together, Mook and Wolfe were responsible for developing and delivering specialized technical and safety trainingto Rowan’s global oilfieldworkforce. 821739.2 On or around October 2013, Mook and Wolfe determined that they would hire training contractors through staffing agencies to supplemental Rowan’s training department. In late October 2013, Whitney who also happens to be Mook’s stepsonsubmitte d his resume to one of these staffing agencies for consideration as a training contractor. Mook, Wolfe, and Whitney quickly realized, however, that they could all profit off Rowan by creating a third party training companywhich Whitney would “run andco _ niracting directly with Rowan. Shortly thereafter, Mook, Wolfe, and Whitney created the so called “Titan Technical Training, LLC” and misrepresented to Rowan that Whitney was Titan’s Chief Operations Officer. Mook and Wolfe further misrepresented to Rowan that Titan was experienced in proving specialized training on a global scale in areas including, but not limited to, electrical, mechanical, fluid dynamics, and industry standards on matters such as safety and the environment, and that Whitney had good standing in the oilfield services industry. In truth, there was no “Titan Technical Training, LLC,” and Whitney had no experience in the technical training industry, must less experience that would qualify him to train Rowan’s global workforce. The purported “Titan Technical Training, LLC” had no customers, no offices, and no employees. It was a sham entity used solely for the purpose of defrauding Rowan. In an effort to create the appearance that “Titan Technical Training, LLC” and Whitney were legitimate, the Defendant Conspirators hid from Rowan the fact that Whitney wes Mook’s stepson, and that Whitney and Mook owned real property together and shared a joint savings account. As a direct result of their omissions, material misrepresentations, and othe fraudulent actions, the Defendant Conspirators caused Rowan to enter into a contract with “Titan 821739.2 Technical Training, LLC” (entitled “Statement of Work for Rowan Companies, Inc.”) on or about November 15, 2013, mere weeks after Whitney had submitted his resume to a staffing agency for consideration. Plaintiff later claimed that, despite the existence of the Statement of Work, which was executed by Plaintiff and Defendant’ s authorized representative, Plaintiff made separate oral contract with Mook for the delivery of training services and construction of training equipment Mook had no authority to enter into contracts on Defendant’ s behalf By representing that (a) “Titan Technical Training, LLC” was an established entity of good standing in the industry, (b) Whitney was an experienced oilfield trainer capable of providing “specialized training” to Rowan’s global workforce, and (c) concealing the Mook Whitney familial relationship, Mook and Wolfe abused their fiduciary duties to Rowan. Whitney knowingly and willfully participated in and aided these breaches of fiduciary duties in order to profit therefrom. To further cover up and facilitate the fraud, Mook lied on his 2013 and 2014 Rowan Annual Conflicts of Interest Questionnaires and Certifications by giving false answers to eleven of the fourteen questions asked. One example of Mook’s lies was his “ answer to the following question: Since January 1, 2012, have you or any of your family members or close friends, either on your or their own behalf or as a shareholder, partner, director, officer, employee, consultant, distributor, agent, or other representative of any other company or entity, engaged in any transactions or other business dealings with [Rowan], whether as a customer, supplier contractor, subcontractor or otherwise? The Conspirators Implement Their Scheme and Fraudulently Obtain $1,094,965.70 from Rowan By fraudulently deceiving Rowan into contracting with “Titan Technical Training, LLC” the Defendant Conspirators laid the groundwork to put their scheme into action. 821739.2 Thereafter, the Defendant Conspirators implemented their fraud by causing Titan to submit invoices to Rowan, which Mookin his capacity as Global Training Manager was authorized. to approve for payment. Mook claimed that he carefully reviewed each invoice to ensure that all items billed had been performed by Titan. In truth and in fact, however, the invoices Mook approved for payment routinely billed Rowan for work Titan had not performed, and consistently evidenced abusive billing practices not provided for in the already favorable Statement of Work that Mook had fraudulently shepherded through on Whitney’s behalf. For example, although the Statement of Work provided that “course development” would be billed out at $1,200 per day, a number of invoices billed “course development” at $1,450 per day. The Defendant Conspirators also caused Titan to submit invoices with work billed by fictitious employees. Mook approved these invoices for payment with full knowledge that these “employees” did not exist. Given that Mook was authorized to approve invoices in his capacity as Global Training Manager, Rowan reasonably relied on Mook’s statements and representations that the invoices had been reviewed before being approved for payment. The Defendant Conspirators knew they could abuse Mook’s invoice approving authority and submit fraudulent invoices worth tens of thousands of dollars each without discovery. Mook further misused his authority in order to (a) push out Rowan employees © were competent and experienced in providing technical training, (b) artificially inflate training budgetary forecasts; and (c) increase the monies that flowed from Rowan to Titan and Whitney. The Defendant Conspirators knowingly and willfully participated in and benefited from that fraud by obtaining $1,094,965.70 from Rowan. At all times during this scheme, Mook and Whitney shared a joint savings account, where portions of the funds Titan received from 821739.2 Rowan were deposited. Mook and Whitney also jointly owned a ten acre plot of land and used funds received from Rowan to make improvements to the property and pay property taxes. For his part in the scheme, Wolfe was compensated at least tens of thousands of dollars in cash that Titan received from Rowan. The defrauding of Rowan was not limited to monies paid directly to Titan. Mook and Wolfe arranged for Rowan to provide Whitney and Titan with office space, equipment, and transportation, both domestically and intemationally, at no charge. Mook also approved Titan invoices billing Rowan for time spent training Titan’s un or under qualified instructors. Defendant Conspirator Wolfe and his wife, who was also a Rowan employee, were aware of Mook and Whitney’s relationship, but did not disclose this fact to anyone at Rowan. When the fraud was uncovered, both Wolfe and his wife lied to Rowan’s investigative team about this fact. The Scheme Expands Wolfe and Whitney, with Mook’s knowledge and participation, expanded the scheme by devising and implementing a plan to steal Rowan’s property and then sell it back to Rowan at an enommous markup. While employed by Rowan, Wolfe constructed training equipment and simulators out of parts that were Rowan’s property. Whitney/Titan paid Wolfe at least $62,430.75 for constructing the training equipment and simulators, which Whitney/Titan had no ability to construct on its own. Titan then sold these simulators back to Rowan by submitting fraudulent invoices totaling $186,264.76. The Conspirators C ontinue Their Fraud Even after Mook is Fired On or about November, 30, 2015, Mook was terminated by Rowan for breach of company policies/disciplinary violations, thus cutting off the essential aspect of the scheme 821739.2 Mook’s ability to approve Titan’s fraudulent invoices. At the time of Mook’s termination, Titan had gotten approximately six (6) months behind in submitting invoices to Rowan. In the days following Mook’s termination, Whitney and Mookusing the name of the same fictitious employee listed on many prior invoicessubmitted _ the six months’ worth of Titan invoices to Rowan in an effort to defraud Rowan out of as much money as possible. Almost immediately, Rowan flagged these and certain other large and unsubstantiated Titan invoices. No one at Rowan was able to explain or account for the work purportedly performed by Titan. Rowan began to investigate the legitimacy of the invoices. The scheme was uncovered and Rowan immediately ceased paying the fraudulent Titan invoices that had been submitted but not yet paid. Unaware that the scheme had been uncovered, Whitney attempted to obtain payment on the remaining fraudulent invoices by enlisting Mook to write a letter on his/Titan’s behalf to Rowan. On or about January 30, 2016, Mook sent the letter to Rowan, under the guise being a disinterested party. The letter materially omitted the fact that Whitney was Mook’s stepson and was filled with false statements, including, inter alia, that Titan had been hired after a search of several companies that were competent to provide “specialized training” on a “global basis,” and that Titan ultimately was chosen “based on the owner's good standing in the industry.” In truth and in fact, as Mook well knew, Titan Technical Training was a sham alter ego for his stepson Whitney, who had no standing in the industry or qualifications to provide “specialized” training to Rowan’s global workforce. After discovering the fraud, Rowan separately interviewed Wolfe and his wife. In a continuing attempt to hide their participation in the scheme, the Wolfes both stated that they were not aware of any familial connection between Mook and Whitney. 821739.2 The Wolfes were later separately interviewed a second time. Mr. Wolfe continued to deny knowledge of the Whitney Mook relationship, even when confronted with evidence thereof. However, Mrs. Wolfe recanted her prior denials and admitted that both she and Mr. Wolfe had been aware that Mook was Whitney’s step father, and that they had never disclosed this fact to anyone at Rowan. After Mook wrote the fraudulent January 30, 2016 letter, he declined to be interviewed by Rowan. Whitney, however, agreed to be interviewed. In that interview Whitney denied any financial or familial relationship with Mook. Later in the interview Whitney was shown documents evidencing that he and Mook owned real property together. Whitney admitted that he and Mook had purchased a ten acre plot of land together, but he continued to deny any other relationship with Mook. Whitney also failed to disclose the fact that he and Mook shared a joint savings account and that funds received from Titan were used to make improvements to, and pay taxes on, their joint property. Whitney was then shown documentation evidencing that he was named on Mook’s car insurance policy. At this point, Whitney visibly reddened, announced that he was leaving, and informed the interviewers that he would not be speaking to them further. Whitney refused to answer any further questions and left the Rowan facility COUNT ONE: COMMON LAW FRAUD AND FRAUDULENT INDUCEMENT (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. The Defendant Conspirators made material misrepresentations and omissions to Rowan as part of a scheme to enrich themselves through improper and illegal methods. 821739.2 A few examples of the Defendant Conspirators’ misrepresentations and omissions are that (a) Whitney was the Chief Operations Officer of a company called “Titan Technical Training, LLC;” (b) “Titan Technical Training, LLC” was an established entity of good standing in the industry; (c) Whitney was an experienced oilfield trainer capable of providing “specialized training’ to Rowan’s global workforce; and (d) concealment of the Mook Whitney familial relationship. The Defendant Conspirators also submitted fraudulent invoices for work that Titan had never performed, overbilled for work Titan allegedly performed, and submitted invoices with work billed by fictitious employees. These and other false representations and material omissions were made by the Defendant Conspirators who knew that the representations were false and the omissions were material. The misrepresentations and omissions were made with the intent that they should be acted upon by Rowan. Rowan reasonably relied on these false representations and material omissions by entering into a contract with the purported “Titan Technical Training, LLC” and paying fake and inflated invoices totaling $1,094,965.70in good faith reliance thereon. Due to the Defendant Conspirators’ fraud, Rowan has suffered damages for which it is entitledto compensation in an amount to be determined at trial. Rowan will likely suffer additional losses as legal proceedings continue and for which it is entitled to recover damages. COUNT TWO: BREACH OF FIDUCIARY DUTY (Mook and Wolfe) Rowan incorporates by reference the factual allegations above as if set forth fully herein. As employees of Rowan, Mook and Wolfe owed fiduciary duties to Rowan as a matter of law. These included, inter alia the duty of loyalty (to act in good faith and not allow 821739.2 personal interests to prevail over those of their employer, Rowan) and the duty of care (to act and perform corporate duties in the same manner as an ordinarily prudent person would under similar circumstances). Mook and Wolfe therefore had the duty to fully disclose all material facts relative to the existence and ownership of “Titan Technical Training, LLC,” to disclose the Mook Whitney familial relationship, to avoid committing fraud against Rowan, to avoid self dealing, and to truthfully answer their Rowan Annual Conflicts of Interest Questionnaires and Certifications. Mook and Wolfe breached their fiduciary duties by, inter alia, committing the acts alleged above. As a result of their breaches of fiduciary duties, Rowan has suffered damages for which it is entitledto compensation in an amount to be determined at trial. Rowan will likely suffer additional losses as legal proceedings continue and for which it is entitled to recover damages. COUNT THREE: AIDING AND ABETTING FRAUD AND BREACH OF FIDUCIARY DUTY (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. All of the Defendant Conspirators aided and abetted in the fraud and breaches of fiduciary duty as set forth above in Counts One and Two, which are incorporated herein by reference. The Defendant Conspirators knew that Mook and Wolfe had fiduciary duties to Rowan and yet they committed acts in furtherance of the fraud and breaches of those duties by inter alia, making misrepresentations and concealing material facts as set forth above, and acting in concert with each other to achieve the objective of defrauding Rowan of at least $1,500,000. 821739.2 Due to the Defendant Conspirators’ unlawful acts, Rowan has suffered and continues to suffer harm, as well as economic and non economic damages, in an amount to be determined at trial. The Defendant Conspirators’ conduct was willful, malicious, and fraudulent, thereby entitling Rowan to exemplary damages. COUNT FOUR: NEGLIGENCE AND GROSS NEGLIGENCE (Mook and Wolfe) Rowan incorporates by reference the factual allegations above as if set forth fully herein. As Rowan employees, Mook and Wolfe each owed a duty to Rowan to act with reasonable prudence. Each of them violated this duty when they committed the acts complained of herein. Mook and Wolfe’s acts, when viewed objectively, involved an extreme risk, indeed the certainty of risk, to Rowan. Specifically, they should have known that participating in a conspiracy to defraud Rowan of over $1,000,000 would result in extreme harm to Rowan. Despite being aware of the risk, Mook and Wolfe proceeded with conscious indifference to the welfare of Rowan. As a result of Mook and Wolfe's negligence and gross negligence, Rowan has suffered damages for which it is entitled to compensation in an amountto be determined at trial. Rowan will likely suffer additional losses as legal proceedings continue and for which it is entitled to recover damages. COUNT FIVE: NEGLIGENCE AND NEGLIGENT MISREPRESENTATION (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. 821739.2 Whitney, Mook and Wolfe each owed a duty to Rowan to act as a reasonably prudent person and use ordinary care to not engage in acts that would harm Rowan. The Defendant Conspirators violated that duty by the fraudulent acts and omissions, breaches of duty, and negligence set forth above. Whitney, Mook and Wolfe acted negligently and made materia misrepresentations and omissions to Rowan in the course of business and in business transactions. As a result of these acts and omissions, Rowan continued to justifiably rely on the Defendant Conspirators to perform their employment duties and/or to conduct business fairly and not to Rowan’ s detriment. The Defendant Conspirators failed to exercise reasonable care in their actions toward Rowan, and these negligent acts and omissions inflicted damages upon Rowan for which it is entitled to compensation in an amount to be determined at trial. Rowan will likely suffer additional losses as legal proceedings continue and for which it is entitled to recover damages. COUNT SIX: CIVIL CONSPIRACY (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. The Defendant Conspirators planned and acted in a concerted fashion amongst themselves and with others in a conspiracy to defraud Rowan. Using Mook and Wolfe’s positions of trust at Rowan, and a fraudulent scheme as set forth above, the Defendant Conspirators conspired to commit improper acts and engaged in a series of overt acts to carry out the scheme to the detriment of Rowan. Due to the Defendant Conspirators’ concerted acts with each other, Rowan has suffered damages for which it is entitled to compensation in an amountto be determined at trial. 821739.2 Rowan will likely suffer additional losses as legal proceedings continue and for which it is entitled to recover damages. COUNT SEVEN: MONEY HAD AND RECEIVED/UN] UST ENRICHMENT (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. The Defendant Conspirators secured money through fraud and by taking undue advantage of Rowan. That money, in equity and good conscience, belongs to Rowan. Said money includes approximately $1,094,965.70 obtained from Rowan as a result of the acts and omissions, breaches of duty, and negligence alleged above. The Defendant Conspirators should be required,in equity and good conscience, to tum over all the profits they made through their fraud, conspiracy, and/or breaches of duty toward Rowan. COUNT EIGHT: EXEMPLARY DAMAGES (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. The Defendant Conspirators’ conduct was willful, intentional and/or grossly negligent. The Defendant Conspirators knew that their actions, including their misrepresentations, omissions, and breaches of their fiduciary duties, were harmful to Rowan. Nevertheless, they proceeded with conscious indifference toward Rowan. The Defendant Conspirators, in the acts and conduct described above, also engaged in intentional, deliberate, knowing and malicious conduct designed to deceive and defraud Rowan. As a result they should be held accountable and subjected to punitive/exemplary damages as provided for under Texas law. 821739.2 Therefore, Rowan seeks punitive and exemplary damages in an amount to be determined by a jury under Texas law. RAC ODE SEC COUNT NINE: ATTORNEY’S FEES AND COSTS (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. Rowan is entitled to an award of its attomey’s fees, costs of court, and expenses pursuant to Texas Law Rowan therefore seeks an award from the Defendant Conspirators of all such attomey’s fees, costs of court, and expenses incurred in this litigation. COUNT TEN: PRE AND POST JUDGMENT INTEREST All Defendant Conspirators Rowan incorporates by reference the factual allegations above as if set forth fully Rowan is entitled to pre and post judgment interest pursuant to Texas Law. Rowan therefore seeks pre and post judgment interest from the Defendant Conspirators. COUNT ELEVEN: SETOFF AND RECOUPMENT. (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. Rowan denies that it owes any money to the Defendant Conspirators due to their wrongful actions and tortious conduct described herein. To the extent the Court finds that Rowan owes the Defendant Conspirators any money, then pursuant to the doctrines of setoff and recoupment Rowan demands to setoff that amount by the amount owed to Rowan by Defendant Conspirators, including but not limited to the damages and other remedies awarded in this case. 821739.2 COUNT TWELVE: FEE FORFEITURE AND DISGORGEMENT All Defendant Conspirators Rowan incorporates by reference the factual allegations above as if set forth fully As employees of Rowan, Mook and Wolfe owed fiduciary duties to Rowan as a matter of law. Mook and Wolfe breached their fiduciary duties by, inter alia, failing to fully disclose all material facts relative to the existence and ownership of “Titan Technical Training, LLC,” failing to disclose the Mook Whitney familial relationship, failing to respond truthfully on their Rowan Annual Conflicts of Interest Questionnaires and Certifications, and by conspiring to defraud and. defrauding Rowan of over $1,000,000. Furthermore, the Defendant Conspirators knew that Mook and Wolfe owed fiduciary duties to Rowan, and yet they aided and abetted in the breaching of those duties and committed acts to defraud Rowan, including inter alia, making misrepresentations and concealing material facts as set forth above, and acting in concert with each other to achieve the objective of defrauding Rowan of at least $1,500,000. The Defendant Conspirators’ breaches of fiduciary duties and acts of fraud were clear and serious and significantly harmed Rowan. The fees and profits collected by the Defendant Conspirators as a result of their breaches of fiduciary duties and acts of fraud should therefore be forfeited and disgorged in an amount to be determined at trial. COUNT THIRTEEN: CONSTRUCTIVE TRUST All Defendant Conspirators Rowan incorporates by reference the factual allegations above as if set forth fully Mook and Wolfe breached their fiduciary duties to and defrauded Rowan of over 000 by, inter alia , failing to fully disclose all material facts relative to the existence and 821739.2 ownership of “Titan Technical Training, LLC,” failing to disclose the Mook Whitney familial relationship, and failing to respond truthfully on their Rowan Annual Conflicts of Interest Questionnaires and Certifications. The Defendant Conspirators further aided and abetted in the breaching of Mook and Wolfe's fiduciary duties and acted in concert with each other to achieve the objective of defrauding Rowan of at least $1,500,000. As aresult of the Defendant Conspirators’ breaches of fiduciary duties and acts of fraud, the Defendant Conspirators were unjustly enriched in excess of $1,000,000. Whitney and Mook were also unjustly enriched through improvements to their jointly owned real property. Rowan demands that a constructive trust be placed on the proceeds, funds, and property improvements obtained as a result of the Defendant Conspirators’ breaches of their fiduciary duties and acts of fraud. COUNT FOURTEEN: RESCISSION (All Defendant Conspirators) Rowan incorporates by reference the factual allegations above as if set forth fully herein. Altematively, Rowan requests that the contract with Whitney/Titan be rescinded and that Rowan be awarded consideration paid, together with such further special damages and. expenses incurred as a result of the fraudulent contract, which are necessary to restore Rowan to its position before the fraudulent contract was entered into. Smith v. Nat’] Resort Commumities, Inc., 585 S.W.2d 655, 660 (Tex. 1979). The contract with Whitney/Titan was secured through fraud and Mook and Wolfe's breaches of their fiduciary duties. Prior to uncovering the fraud, Rowan did not breach the contract. As soon as Rowan uncovered the fraud, Rowan immediately stopped paying Titan’s fraudulent invoices and teminated its relationship with Titan. Rowan is therefore 821739.2 entitled to rescission of the fraudulent contract to avoid the Defendant Conspirators’ unjust enrichment. VI. CONDITIONS PRECEDENT All conditions precedent to Rowan’s counterclaims have been performed, discharged or waived. VII. TOLLING OF LIMITATIONS To the extent that Mook, Wolfe, or Whitney raises the statute of limitations as a defense, limitations were tolled based on the discovery nile, the doctrine of fraudulent concealment, and the continuing tort doctrine. VIII. PRAYER Rowan prays that Plaintiff take nothing on its claims and that Rowan be granted Judgment in its favor on all Counterclaims and be awarded the following against the Defendant Conspirators: Damages on its Counterclaims; Attomey’s fees and expenses; and All other relief to which Rowan may be entitled at law and in equity. 821739.2 Respectfully submitted, MYSER APLAN ESELKA L.L.P. By:__/s/David Isaak David Isaak State Bar No. 24012887 acquelyn R. Rex State Bar No. 24098317 700 Louisiana, Suite 2300 Houston, Texas 77002 Telephone: (713) 221 2300 Facsimile: (713) 221 2320 disaak@skv.com. jrex@skv.com ATTORNEYS FOR DEFENDANT/ COUNTER PLAINTIFF ROWAN COMPANIES, INC CERTIFICATE OF SERVI T hereby certify that a true and correct copy of the foregoing instrument was served on all counsel of record and on Third Party Defendant J.P. Mook, pro se, via email and/or the Coutt’s CM/ECF filing systemFebruary 2 /s/ David Isaak David Isaak 821739.2