Magellan Pipeline Company, L.P. v. Suncor Energy (U.S.A) Inc.

Opinion

SUPERIOR COURT

OF THE

STATE OF DELAWARE

PAUL R. WALLACE LEONARD L. WILLIAMS JUSTICE CENTER JUDGE 500 N. KING STREET, SUITE 10400 WILMINGTON, DELAWARE 19801 (302) 255-0660

Submitted: August 3, 2026* Decided: August 21, 2026

Richard L. Renck, Esquire David E. Ross, Esquire Robert M. Palumbos, Esquire (argued) S. Reiko Rogozen, Esquire Rebecca E. Bazan, Esquire A. Gage Whirley, Esquire DUANE MORRIS LLP ROSS ARONSTAM & MORITZ LLP 1201 North Market Street, Suite 501 1313 North Market Street, Suite 1001 Wilmington, Delaware 19801 Wilmington, Delaware 19801

Hugh Q. Gottschalk, Esquire Eric L. Robertson, Esquire (argued) Danielle L. Trujillo, Esquire WHEELER TRIGG O’DONNELL LLP 370 Seventeenth Street, Suite 4500 Denver, Colorado 80202

RE: Magellan Pipeline Company, L.P. v. Suncor Energy (U.S.A.) Inc., et al.

C.A. No. N25C-02-418 PRW CCLD Magellan Pipeline Company, L.P.’s Motion to Dismiss Counterclaims and to Strike Affirmative Defenses

Dear Counsel:

This Letter Decision and Order addresses Magellan’s Motion to Dismiss

Suncor Energy (U.S.A.) Inc.’s two fraud-related counterclaims and several

affirmative defenses arising from those counterclaims (D.I. 65). For the reasons

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 2 of 22

explained now, the Motion is GRANTED in part and DENIED in part.

I. FACTUAL BACKGROUND1

A. PARTIES

Suncor is a Delaware corporation, with its principal place of business in

Colorado.2 Suncor owns and operates refining assets in Colorado.3

Magellan is a limited partnership organized under the laws of Delaware.4

Magellan owns and operates the Dupont Terminal in Colorado.5

B. LEAD UP TO THE AGREEMENTS AND THE PIPELINE EXPANSION “CONCEPT”

In early 2023, Suncor and Magellan entered into several agreements to

transport, store, and load gasoline from Commerce City, Colorado, to the Dupont

Terminal.6 After signing those agreements, Aaron Cissell, Magellan’s Vice President

*

While the Court initially believed it would need to consider this matter fully submitted only upon docketing of the hearing transcript (D.I. 74), it has found that its notes and review of all other motion materials has sufficed. 1 The Court draws the following facts from the well-pleaded allegations and documents incorporated by reference in Suncor’s Counterclaim. The Court has also laid out some of this background in its earlier decision on Defendants’ motions to dismiss. See Magellan Pipeline Co., L.P. v. Suncor Energy (U.S.A.) Inc., 2026 WL 766429, at *1–3 (Del. Super. Ct. Feb. 26, 2026). 2 Countercl., ¶ 12 (D.I. 58).

3 Id., ¶ 13.

4 Id., ¶ 14.

5 Id.

6 Id., ¶ 18.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 3 of 22

of Commercial, Refined Products, contacted Suncor agents to discuss further

strategic opportunities between Suncor and Magellan.7 Suncor agreed to a meeting

to discuss additional opportunities regarding gasoline supply.8

Before the meeting, Suncor employee James Piscatelli talked to Magellan

representative Fawn McWilliams about a winter fill agreement.9 Under the proposed

winter fill agreement, Suncor would store gasoline in Magellan tanks in Colorado

during the winter to capitalize on lower gasoline supply in the Denver area during

the summer months.10

At the meeting, Magellan representatives presented a slide deck that included

a reference to a “Front Range Supply Optimization Concept.”11 The Magellan

representatives explained that the concept contemplated Magellan potentially

building a pipeline from Scott City, Kansas, to Denver International Airport.12 The

Magellan reps referred to this idea only as a “concept” and didn’t share any plans

7 Id., ¶ 19.

8 Id., ¶ 20.

9 Id., ¶¶ 21–22.

10 Id., ¶ 22.

11 Id., ¶ 25.

12 Id.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 4 of 22

for actual construction.13

Suncor didn’t like the “concept.” Mr. Piscatelli rejected it and indicated that

Suncor wouldn’t back the idea because it would hurt Suncor’s summer gasoline

margins.14 The parties didn’t discuss the concept further and instead continued

discussing the winter fill agreement plan.15 Suncor left the meeting understanding

that the concept and the winter fill agreement were mutually exclusive options—that

is, if Suncor agreed to the winter fill agreement then Magellan wouldn’t pursue the

“concept.”16 Eventually, Suncor and Magellan entered into the winter fill plan

through the DuPont Storage and Terminalling Agreement (“Terminalling

Agreement”) and Amendment I to the Ethanol Storage Services Agreement

(“Ethanol Agreement”) (collectively, “Agreements”).17

C. MAGELLAN ANNOUNCES PIPELINE EXPANSION PROJECT

Several months after executing the Agreements, Magellan issued a press

release introducing the Pipeline Expansion Project.18 That Project was the Kansas-

13 Id.

14 Id., ¶ 26.

15 Id., ¶¶ 26–28.

16 Id.

17 Id., ¶ 32.

18 Id., ¶ 36.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 5 of 22

to-Denver pipeline “concept” discussed at the meeting.19 After some back-and-forth,

Suncor told Magellan to stop all work associated with the Agreements.20 Suncor

then notified Magellan that Suncor was electing to rescind the Agreements, and

Magellan responded with a notice of default, a notice of termination, and a demand

for payment.21

D. RELEVANT CONTRACT PROVISIONS

In the Terminalling Agreement, Suncor disclaimed reliance on any of

Magellan’s extra-contractual representations:

No Warranty; No Reliance. Except as expressly provided in this Agreement, Magellan makes no representations or warranties, express or implied, including any implied warranty of merchantability or fitness for a particular purpose. In entering into this Agreement, Customer is relying upon its own judgment, and Customer is not relying upon, and disclaims any reliance upon, any representation made by or on behalf of Magellan that is not specified in this Agreement.22

The Parties also agreed in the Terminalling Agreement that they had no

express relationship:

No Partnership. There is no partnership, joint venture, association or special relationship of any kind, or intent to create one, between or among the parties or their respective Affiliates with respect to the

19 Id.

20 Id., ¶ 40.

21 Id., ¶¶ 42–43.

22 Compl., Ex. A [hereinafter the “Terminalling Agreement”] Sched. B, § 7 (D.I. 1).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 6 of 22

arrangements contemplated by this Agreement, and the parties expressly disclaim the formation of any such relationship. Neither this Agreement nor any discussions, conduct or interactions between or among them may be interpreted as creating such a relationship or intent, which may instead only arise when and if documented and approved by the respective boards or other governing bodies of each of the parties. Neither party will be or become liable or bound by any representation, act or omission of the other party.23

Finally, the Terminalling Agreement contains an integration clause:

Entire Agreement; Amendment. This Agreement states the entire agreement between the parties with respect to the subject matter hereof, and supersedes all prior agreements, negotiations and understandings, whether oral or written, between the parties with respect to such subject matter. This Agreement may not be amended except by written instrument executed by the parties hereto.24

E. SUNCOR’S FRAUDULENT MISREPRESENTATION AND FRAUDULENT NONDISCLOSURE COUNTERCLAIMS

In this action, Suncor now brings two counterclaims against Magellan for:

(1) fraudulent misrepresentation; and (2) fraudulent nondisclosure.25 For Count I,

Suncor alleges that Magellan fraudulently misrepresented the truth about Magellan’s

intentions concerning the expansion project.26 For Count II, Suncor asserts that

Magellan had a duty to disclose and failed to reveal that the expansion concept was

23 Terminalling Agreement § 23.

24 Id., § 24.

25 Countercl., ¶ 47.

26 Id., ¶¶ 49–52.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 7 of 22

more than just a concept.27 Suncor also pleads affirmative defenses of fraudulent

inducement, fraudulent concealment, frustration of purpose, and failure of

consideration.28

II. PARTIES’ CONTENTIONS

Magellan argues that the Court should dismiss the fraud counterclaims

because Suncor disclaimed reliance on Magellan’s representations in the

Terminalling Agreement.29 Magellan also contends that inquiry notice prevents

Suncor from establishing justifiable reliance.30

Turning to the fraudulent misrepresentation counterclaim, Magellan asserts

that Suncor fails to identify a misrepresentation of a material fact. 31 For the

fraudulent nondisclosure counterclaim, Magellan posits it didn’t have a duty to

unveil its pipeline project intentions.32 Magellan also avers that Suncor’s fraudulent

inducement, fraudulent concealment, frustration, and lack-of-consideration

affirmative defenses should be dismissed because they are not well pleaded, and the

27 Id., ¶ 61.

28 Defs.’ Affirmative Defenses 2–3, 6–7 (D.I. 58).

29 See generally Magellan Op. Br. at 9–17 (D.I. 66).

30 See generally id. at 17–21.

31 See generally id. at 21–24.

32 See generally id. at 25–32.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 8 of 22

fraud-related defenses fail for the same reasons as the fraud-related counterclaims.33

In response, Suncor counters that it has pled all the elements of fraudulent

misrepresentation and fraudulent nondisclosure, and that the non-reliance clause

isn’t specific enough to disclaim reliance.34 Likewise, Suncor replies that the non-

reliance provision doesn’t cover Magellan’s undisclosed intentions relating to the

pipeline expansion project.35 As to the affirmative defenses, Suncor insists they are

well-pleaded at the motion-to-dismiss stage.36

In reply, Magellan reiterates that the Terminalling Agreement’s non-reliance

provision is broad enough to cover both claims, and Suncor was otherwise on inquiry

notice about the pipeline project, so Suncor cannot prove reliance.37 Magellan

maintains that Suncor fails to plead a false representation under its fraudulent

misrepresentation counterclaim, and cannot establish that Magellan had a duty to

disclose under the fraudulent nondisclosure claim based on the Restatement

(Second) of Torts.38 Finally, Magellan posits that the Court should dismiss Suncor’s

33 See generally id. at 32–34.

34 See generally Suncor’s Opp’n at 6–30 (D.I. 71).

35 See generally id. at 25–26.

36 See generally id. at 31–34.

37 See generally Magellan’s Reply at 2–11 (D.I. 72).

38 See generally id. at 11–21.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 9 of 22

affirmative defenses that are derivative of the faulty fraud-related counterclaims

under Superior Court Civil Rule 12(f).39

The Parties agree that Colorado law governs.40

III. STANDARD OF REVIEW

Magellan seeks to dismiss both counterclaims under Rule 12(b)(6) for failure

to state a claim upon which relief can be granted.41 The governing standard requires

the Court to “(1) accept all well pleaded factual allegations as true, (2) accept even

vague allegations as ‘well pleaded’ if they give the opposing party notice of the

claim, [and] (3) draw all reasonable inferences in favor of the non-moving party.”42

The Court need not “accept every strained interpretation of [Suncor’s] allegations”43

or conclusory statements “unsupported by allegations of specific facts.”44 Dismissal

is appropriate only if Suncor “would not be entitled to recover under any reasonably

39 See generally id. at 21–23.

40 Magellan Op. Br. at 1 n.2; Suncor’s Opp’n at 7 n.1.

41 D.I. 65.

42 Cent. Mortg. Co. v. Morgan Stanley Mortg. Cap. Hldgs. LLC, 27 A.3d 531, 535 (Del. 2011) (citing Savor, Inc. v. FMR Corp., 812 A.2d 894, 896–97 (Del. 2002)). 43 Gen. Motors (Hughes) S’holder Litig., 897 A.2d 162, 168 (Del. 2006) (quoting Malpiede v. Townson, 780 A.2d 1075, 1083 (Del. 2001)). 44 In re Lukens Inc. S’holders Litig., 757 A.2d 720, 727 (Del. Ch. 1999), aff’d sub nom., Walker v. Lukens, Inc., 757 A.2d 1278 (Del. 2000).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 10 of 22

conceivable set of circumstances susceptible of proof.”45

Magellan also seeks to dismiss several of Suncor’s affirmative defenses under

Rule 12(f). Rule 12(f) permits the Court to “‘order stricken from any pleading any

insufficient defense or any redundant, immaterial, impertinent, or scandalous

matter.’”46 Motions to strike an insufficient defense “focus on the form of the

pleading and not its substance.”47 When ruling on such motion, the Court construes

all facts in favor of the nonmoving party and denies the motion if the defense is

sufficient under law.48 The Court disfavors motions to strike.49

IV. ANALYSIS

Suncor’s fraudulent misrepresentation counterclaim fails because Suncor

disclaimed reliance on all Magellan representations in the Terminalling Agreement.

And Colorado enforces non-reliance provisions that expressly disclaim reliance.

45 Savor, 812 A.2d at 896–97; Priveterra Capital, Mgmt., LLC v. Pixium Vision, LLC, 2026 WL 940227, at *3 (Del. Super. Ct. Apr. 7, 2026). 46 DDS Striker Holdings, LLC v. Verisk Analytics, Inc., 2024 WL 3983973, at *3 (Del. Super. Ct. Aug. 29, 2024) (quoting Super. Ct. Civ. R. 12(f)). 47 Columbus Life Ins. Co. v. Wilmington Tr. Co., 2021 WL 537117, at *5 (Del. Super. Ct. Feb. 15, 2021). 48 Id. (citation modified).

49 Heisenberg Principals Fund IV, LLC v. Bellrock Intelligence, Inc., 2018 WL 3460433, at *1 (Del. Super. Ct. July 17, 2018) (citing Vannicola v. City of Newark, 2010 WL 5825345, at *8 (Del. Super. Ct. Dec. 21, 2010))

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 11 of 22

But the fraudulent nondisclosure counterclaim endures. While Suncor

disclaimed reliance on Magellan’s representations, Suncor didn’t disclaim reliance

on Magellan’s unstated true intentions about the expansion project. And Suncor has

otherwise stated a reasonably conceivable counterclaim of fraudulent nondisclosure.

Finally, Suncor’s affirmative defenses are well-pleaded. The fraudulent

nondisclosure counterclaim is well-pleaded. And because the affirmative defenses

relate to that well-pleaded counterclaim, they survive this early stage of litigation on

the same grounds.

A. SUNCOR’S FRAUDULENT MISREPRESENTATION COUNTERCLAIM FAILS TO STATE A CLAIM AS SUNCOR UNAMBIGUOUSLY DISCLAIMED RELIANCE ON ANY MAGELLAN REPRESENTATIONS.

To prevail on a fraud claim, under Colorado law, a party must prove: (1) that

the opposing party made a false representation of a material fact; (2) that the one

making the representation knew it was false; (3) that the person to whom the

representation was made was ignorant of the falsity; (4) that the representation was

made with the intention that it be acted upon; and (5) that the reliance resulted in

damage to the plaintiff.50

For the reliance element, a party must show actual reliance, the reasonableness

50 Bristol Bay Prods., LLC v. Lampack, 312 P.3d 1155, 1160 (Colo. 2013).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 12 of 22

of the reliance, and that the reliance caused damage.51 Contract language that clearly

and specifically disclaims precontract representations or omissions can preempt

fraud claims which are based on those statements or omissions.52 A general

integration clause alone will not suffice.53 Instead, a non-reliance provision “must

be couched in clear and specific language.”54

Here, the Terminalling Agreement has an integration clause.55 And Suncor

disclaimed reliance on “any representation made by or on behalf of Magellan that is

not specified in this Agreement.”56 Suncor’s fraudulent misrepresentation

counterclaim rests entirely upon its reliance on Magellan’s representation that the

expansion was only a concept and not a definite plan. The Agreements don’t

mention the pipeline expansion project. So Suncor could not have reasonably relied

on this representation, since it disclaimed reliance on any Magellan representations

outside the Agreements. Because Suncor cannot prove reasonable reliance on this

51 Id.

52 Keller v. A.O. Smith Harvestore Products, Inc., 819 P.2d 69, 74 (Colo. 1991); LBI Grp., LLC v. Scanlan, 2024 WL 3947026, at *5 (Colo. App. July 11, 2024). 53 LBI Grp., 2024 WL 3947026, at *5.

54 Keller, 819 P.2d at 74; Colorado Coffee Bean, LLC v. Peaberry Coffee Inc., 251 P.3d 9, 19 (Colo. App. 2010), as modified on denial of reh’g (Apr. 1, 2010). 55 Terminalling Agreement § 24.

56 Terminalling Agreement Sched. B, § 7

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 13 of 22

representation, Counterclaim Count I is DISMISSED.

True, even if only one counterclaim endured the motion-to-dismiss stage,

discovery would proceed in largely the same manner. Likewise, Rule 12(b)(6) asks

only whether the complaint states a claim upon which relief can be granted, not

whether every theory states a claim on which relief can be granted.57

There can be significant value in dispensing with meritless claims at the pleading stage. But a court need not examine the sufficiency of every count in a complaint or consider every argument that a defendant has advanced. That is particularly true when an issue will not result in the dismissal of a defendant from the case and where the case involves a common nucleus of operative fact that will be the focus of discovery in any event. In that setting, the case can readily proceed past the pleading stage.58 The counterclaims here indeed arise from the same nucleus of fact. And discovery

overlaps substantially since both counterclaims revolve around what was said during

the presentation and in the lead-up to the Terminalling Agreement. But it is

impossible for Counterclaim Count I to ultimately succeed because the disclaimer

expressly covers representations. Even if the “concept” was a done deal at the

presentation, and Magellan knew that referring to the done deal as a “concept” was

false, the disclaimer encompasses any extra-contractual representations. This is also

57 In re EngageSmart, Inc. Stockholder Litig., 354 A.3d 796, 863 (Del. Ch. 2026) (cleaned up).

58 Cygnus Opportunity Fund, LLC v. Washington Prime Grp., LLC, 302 A.3d 430, 464 (Del. Ch. 2023).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 14 of 22

true if Magellan represented that the pipeline project and the winter fill plans were

mutually exclusive since, again, this is an extra-contractual representation by

Magellan. The Court need not punt this counterclaim to summary judgment because

further testing of the facts is unnecessary for this counterclaim. 59 Accordingly,

Suncor’s fraudulent misrepresentation counterclaim fails as a matter of law.60

B. BUT SUNCOR’S FRAUDULENT NONDISCLOSURE COUNTERCLAIM SURVIVES, AS THE NON-RELIANCE PROVISION DOESN’T COVER OMISSIONS THAT MAGELLAN KEPT TO ITSELF.

To succeed on a fraudulent nondisclosure or concealment claim under

Colorado law,61 a party must demonstrate: (1) the concealment or nondisclosure of

a material existing fact that in equity and good conscience should be disclosed;

(2) knowledge on the part of the party against whom the claim is asserted that such

a fact is being concealed or not disclosed; (3) ignorance of that fact on the part of

59 See, e.g., Powers v. Office of Child Support, 795 A.2d 1259, 1263 (Vt. 2002) (“The purpose of a motion to dismiss is to test the law of the claim, not the facts which support it.”); see also Total Containment, Inc. v. Environ Products, Inc., 1992 WL 208981, at *1 (E.D. Pa. Aug. 19, 1992) (same). 60 See In re Gen. Motors (Hughes) S’holder Litig., 897 A.2d at 169 (“It is well established that a claim may be dismissed if allegations in the complaint or in the exhibits incorporated into the complaint effectively negate the claim as a matter of law.”) (quotations omitted). 61 See generally Wisehart v. Zions Bancorporation, 49 P.3d 1200, 1204 (Colo. App. 2002)

(acknowledging that the terms fraudulent concealment and fraudulent nondisclosure are used interchangeably and require essentially the same elements). Here, nondisclosure is more accurate because Suncor alleges that Magellan had a duty to disclose that it planned to proceed with the pipeline expansion project.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 15 of 22

the one from whom the fact is concealed or not disclosed to; (4) the intention that

the concealment or nondisclosure be acted upon; and (5) action on the concealment

or nondisclosure resulting in damages.62

For the first element, a party must show that the other party held a duty to

disclose the material information.63 Colorado courts look to the Restatement

(Second) of Torts § 551(2) to determine whether there was a duty to disclose in

equity and good conscience.64 Relevant to Suncor’s counterclaim, a party has a duty

to disclose “matters known to him that he knows to be necessary to prevent his partial

or ambiguous statement of the facts from being misleading.”65

1. The non-reliance clause only covers representations—not omissions.

Unlike the fraudulent misrepresentation counterclaim, the fraudulent

concealment claim avers that Magellan failed to divulge that the pipeline expansion

project was more than just a notion. The non-reliance clause doesn’t cover this, or

any, omission. The clause only covers Magellan’s actual representations—not

omissions that Magellan never conveyed to Suncor.

62 BP Am. Prod. Co. v. Patterson, 263 P.3d 103, 109 (Colo. 2011); Morrison v. Goodspeed, 68 P.2d 458, 462 (Colo. 1937). 63 Mallon Oil Co. v. Bowen/Edwards Associates, Inc., 965 P.2d 105, 111 (Colo. 1998).

64 Id.

65 RESTATEMENT (SECOND) OF TORTS § 551(2)(b) (A.L.I. 1977).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 16 of 22

And under Colorado law, a non-reliance provision in an agreement bars fraud

claims only when a party expressly disclaims reliance. For instance, in Colorado

Coffee Bean, LLC v. Peaberry Coffee Inc.,66 the Colorado Court of Appeals held that

the trial court erred by holding that a non-reliance clause barred reliance on

nondisclosure of losses. There, the plaintiff bought a retail coffee shop franchise

after receiving the defendant’s uniform franchise offering circular (UFOC), which

disclosed the gross sales of existing stores, but stated that it contained no data on

profits and no guarantee of profitability and advised prospective franchisees to

conduct their own financial analyses.67 The franchise agreement was integrated and

contained general exculpatory clauses disclaiming reliance on representations not

found in the agreement.68 The plaintiff asserted a claim for fraudulent nondisclosure

based on two theories—that the franchisor had concealed: (1) losses at existing

stores; and (2) the franchisor’s own losses.69

The appellate court determined that “clear and specific language” in the

UFOC or the franchise agreement could prove the absence of reasonable reliance on

66 251 P.3d 9, 19 (Colo. App. 2010), as modified on denial of reh’g (Apr. 1, 2010).

67 Id. at 15–18.

68 Id. at 20–21.

69 Id. at 18.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 17 of 22

the purported omissions.70 The court thus concluded that the UFOC’s statements

precluded reasonable reliance under the first theory, but that the UFOC and franchise

agreement contained no terms that nullified reasonable reliance under the second

theory.71 The reason was that while the plaintiffs disclaimed reliance on affirmative

representations outside the transactional documents, there was no disclaimer

concerning a failure to disclose material information.72 In doing so, the court

distinguished between disclaiming reliance on affirmative representations outside

the transactional documents and a failure to disclose material information.73

Here, the non-reliance provision only covers Magellan’s representations.

Suncor alleges that Magellan failed to disclose that the pipeline expansion project

was a sure thing. Although this counterclaim relates to the representation that the

pipeline expansion was only a concept, and Suncor disclaimed reliance on this

representation:

[a] statement that is partial or incomplete may be a misrepresentation because it is misleading, when it purports to tell the whole truth and does not. So also may a statement made so ambiguously that it may have two interpretations, one of which is false. When such a statement

70 Id. at 19–20.

71 Id. at 19–22.

72 Id. at 19.

73 Id. at 19–21; see also id. at 21 (noting that “neither clause disclaims reliance on undisclosed but material information.”).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 18 of 22

has been made, there is a duty to disclose the additional information necessary to prevent it from misleading the recipient. In this case there may be recovery either on the basis of the original misleading statement or of the nondisclosure of the additional facts.74

Magellan’s failure to disclose the additional facts may entitle Suncor to recovery.

And the disclaimer here doesn’t apply to facts that Magellan failed to represent to

Suncor. The disclaimer also doesn’t state that Suncor is disclaiming reliance on the

completeness of Magellan’s representations. So the Terminalling Agreement’s non-

reliance clause doesn’t bar the fraudulent non-disclosure counterclaim since the non-

reliance clause doesn’t cover undisclosed material facts.

2. It is reasonably conceivable that Magellan had a duty to correct its statement that the pipeline project was only a “concept.”

Next, Magellan insists that the fraudulent nondisclosure counterclaim fails as

it didn’t have a duty to disclose that the pipeline expansion project was more than

just a concept. Under the Restatement, Magellan had a duty to disclose matters it

knew were necessary to prevent its partial or ambiguous statement of the facts from

misleading Suncor. Based on the well-pleaded facts in Counterclaim Count II, it is

reasonably conceivable that Magellan stated only that there was a pipeline expansion

project concept when it had far more definitive plans to complete the project and

74 RESTATEMENT (SECOND) OF TORTS § 551 cmt. 2(g) (A.L.I. 1977) (emphasis added).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 19 of 22

knew that calling the expansion a concept would make it seem less like the expansion

was already going to happen. It is also reasonably conceivable that Magellan knew

the pipeline expansion was a done deal and that Suncor wouldn’t sign the

Terminalling Agreement if it knew the pipeline expansion was happening. Under

these facts, Magellan may have had a duty to correct its partial or ambiguous

description of the pipeline project as a concept.

3. It is reasonably conceivable that Suncor didn’t know that the pipeline expansion project was going to happen. Magellan also asserts that Suncor cannot state a claim for fraudulent

nondisclosure since Suncor cannot establish ignorance of the pipeline expansion

project. Magellan cites Nielson v. Scott75 to support this contention. There, the

plaintiffs, buyers of an RV park, sued the seller for misrepresenting the seriousness

of a wastewater problem in the park. The seller verbally assured the buyers that a

$15,000 upgrade could solve the problems with the park’s septic system. 76 But the

buyers’ attorney learned the park needed a groundwater discharge permit from a

state agency and that this agency suspected the RV park didn’t comply with state

75 55 P.3d 777, 780 (Colo. App. 2002).

76 Id. at 778.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 20 of 22

water quality laws.77 Despite the attorney’s warnings, the buyers proceeded with the

purchase, and acknowledged in the sales contract that their “due diligence

inspection,” including environmental and water issues, had been completed to their

satisfaction.78 When the buyers learned that the septic system did not follow state

regulations, and that the problem could not be solved by expanding the septic

system, the plaintiffs sued the sellers for fraudulent misrepresentation.79 The trial

court granted the sellers’ motion for summary judgment, and the Colorado Court of

Appeals affirmed since any reliance on the sellers’ representation was not justifiable

because the buyers knew there were problems and should have investigated further.80

Here, Suncor alleges it didn’t know that Magellan was definitely completing

the pipeline project and thought if the Parties agreed to the winter fill plan, then the

pipeline project wouldn’t happen. No doubt, Suncor shoulders a heavy burden to

prove that it was under the impression that the pipeline was only a “concept” and

that a thorough investigation and due diligence—or even just a few more follow-up

questions at the meeting with Magellan—wouldn’t have shown that the project was

77 Id. at 778–79.

78 Id.

79 Id.

80 Id.

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 21 of 22

more than just that. But this case is only at the motion-to-dismiss stage. And Suncor

has set forth facts showing that it didn’t know the pipeline project was a sure thing

and that Magellan created an impression that the pipeline project was only a potential

idea during negotiations.81 Accordingly, Suncor has stated a reasonably conceivable

counterclaim for fraudulent nondisclosure, and the Court DENIES the Motion as to

Counterclaim Count II.

C. SUNCOR’S AFFIRMATIVE DEFENSES ARE WELL-PLEADED BECAUSE A FRAUD THEORY REMAINS IN PLAY.

Magellan also moves to dismiss Suncor’s affirmative defenses of fraudulent

inducement, fraudulent concealment, frustration, and lack of consideration because

they are derivative of Suncor’s faulty counterclaims.

Here, only Suncor’s fraudulent misrepresentation counterclaim fails. The

fraudulent concealment counterclaim and its related defenses are still alive and

relevant to this action. And the only challenged defenses are those that depend on

the Court dismissing both fraud-related counterclaims. But there is still a fraud-

related theory in play, and the affirmative defenses linked to the surviving well-

81 See Wisehart, 49 P.3d at 1206–07 (holding that trial court erred when ruling that reliance was unjustified at summary judgment when there was a factual dispute over whether the plaintiff availed himself of the invitation to seek more information); see also Franklin Bank, N.A. v. Bowling, 74 P.3d 308, 313 n.11 (Colo. 2003), as modified on denial of reh’g (Aug. 4, 2003) (recognizing that “inquiry notice depends on extrinsic factual inquiry.”).

C.A. No. N25C-02-418 PRW CCLD August 21, 2026 Page 22 of 22

pleaded counterclaim are also well-pleaded. So, Magellan’s Motion is DENIED as

to Suncor’s affirmative defenses.

VI. CONCLUSION

For these reasons, the Court GRANTS Magellan’s Motion, in part, and

DENIES it, in part. Only Counterclaim Count I is DISMISSED.

IT IS SO ORDERED.

/s/ Paul R. Wallace

_________________________

Paul R. Wallace, Judge

cc: All Counsel via File and Serve