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Marco International, LLC v. Como-Coffee, LLC

United States District Court, E.D. Michigan, Southern Division

April 16, 2018

MARCO INTERNATIONAL, LLC, a Pennsylvania limited liability company, Plaintiff,
v.
COMO-COFFEE, LLC, a Delaware limited liability company, and COMOBAR, LLC, a Florida limited liability company, Defendants.

          OPINION AND ORDER GRANTING DEFENDANT CRAIG STEEN'S MOTION FOR JUDGMENT ON THE PLEADINGS (ECF NO. 28) AND DISMISSING STEEN FROM THIS ACTION WITH PREJUDICE

          PAUL D. BORMA UNITED STATES DISTRICT JUDGE

         Plaintiff Marco International, LLC (“Marco”) claims that Defendants Como-Coffee, LLC (“Como-Coffee”), Comobar, LLC (“Comobar”), and Craig Steen (“Steen”), (collectively Defendants), breached promises and agreements to make certain lump sum and royalty payments to Marco in exchange for a license to use Marco's publicity rights, specifically the name and image of Marco Andretti, in marketing Como-Coffee's products. On June 15, 2018, this Court issued an Opinion and Order denying Defendants' motion filed pursuant Fed.R.Civ.P. 12(b)(1) to dismiss for lack of personal jurisdiction and improper venue. Defendants then filed Answers to Plaintiff's Complaint.

         Defendant Craig Steen now moves for judgment on the pleadings, arguing that the Plaintiff's Complaint fails to state a plausible claim for relief against him. (ECF No. 28, Defendant Craig Steen's Motion to Dismiss.) Plaintiff filed a Response (ECF No. 33) and Steen filed a Reply (ECF No. 36). The Court held a hearing on the motion on February 1, 2018. For the reasons that follow, the Court GRANTS the motion.

         I. BACKGROUND

         The Court takes the facts for purposes of this motion for judgment on pleadings, as it must, from the allegations of the Plaintiff's Complaint.[1] The Complaint alleges that on or about January 26, 2015, Marco and Como-Coffee entered into an Agreement in which Como-Coffee was granted a license to use Marco's rights of publicity in exchange for guaranteed payments and royalties. (ECF No. 1, Compl. ¶ 11, Ex. 2, Jan. 26, 2015 Agreement.) Defendant Como-Bar executed a Guaranty agreeing to pay the liabilities and obligations of Como-Coffee under the Agreement. (Compl. ¶ 12.) The Complaint alleges that amounts due under the Agreement were payable to Marco in Oakland County, Michigan. (Compl. ¶ 6, Ex. 1, Jan. 11, 2016 Letter and Invoice.) The Complaint alleges that the Agreement called for three (3) $45, 000 Minimum Annual Guarantee payments to be paid by Como-Coffee to Marco. The Complaint alleges that except for one payment of $1, 000.00, none of the payments agreed to under the Agreement have been made. (Compl. ¶¶ 16-17.) Marco claims in the Complaint that at least $134, 000.00 is due and owing as a result of Defendants' failures to pay under the terms of the Agreement. (Compl. ¶ 18.)

         Marco alleges three separate Counts in the Complaint: Count I for Breach of Contract against Como-Coffee; Count II for Breach of Contract against Comobar on the Guaranty; and Count III against Craig Steen “Fraud (Bad Faith Promise).” Only Count III against Steen is at issue in this motion for judgment on the pleadings. Count III alleges that Steen “repeatedly promised [Marco] that Como-Coffee and Comobar would make the payments required by the Agreement.” Count III further alleges that at the time Steen made these promises, he knew neither Como-Coffee nor Comobar had any intention to make the payments required under the Agreement, and that Steen made these statements with the intent that Marco would rely on them, and that Marco did rely on them. (Compl. ¶¶ 29-32.) The only documents attached to the Complaint are the January 11, 2016 request for the 2015 Minimum Annual Guaranty payment under the Agreement to Craig Steen and the accompanying January 11, 2016 Invoice. (Compl. Exs. 1, 2.)

         II. STANDARD OF REVIEW

         “Motions for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c) are analyzed under the same de novo standard as motions to dismiss pursuant to Rule 12(b)(6).” Sensations, Inc. v. City of Grand Rapids, 526 F.3d 291, 295 (6th Cir. 2008) (citing Penny/Ohlmann/Nieman, Inc. v. Miami Valley Pension Corp., 399 F.3d 692, 697 (6th Cir. 2005)). “The standard of review for a Rule 12(c) motion is the same as for a motion under Rule 12(b)(6) for failure to state a claim upon which relief can be granted.” Fritz v. Charter Twp. of Comstock, 592 F.3d 718, 722 (6th Cir. 2010). “[T]he legal standards for adjudicating Rule 12(b)(6) and Rule 12(c) motions are the same . . . .” Lindsay v. Yates, 498 F.3d 434, 437 n. 5 (6th Cir. 2007).

         When reviewing a motion to dismiss under Rule 12(b)(6), and therefore under Rule 12(c), a court must “‘construe the complaint in the light most favorable to the plaintiff, accept its allegations as true, and draw all reasonable inferences in favor of the plaintiff.'” Handy-Clay v. City of Memphis, 695 F.3d 531, 538 (6th Cir. 2012) (quoting Directv Inc. v. Treesh, 487 F.3d 471, 476 (6th Cir. 2007)). The court “need not accept as true a legal conclusion couched as a factual allegation, or an unwarranted factual inference.” Handy-Clay, 695 F.3d at 539 (internal quotation marks and citations omitted). See also Eidson v. State of Tenn. Dep't of Children's Servs., 510 F.3d 631, 634 (6th Cir. 2007) (“Conclusory allegations or legal conclusions masquerading as factual allegations will not suffice.”).

         In Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), the Supreme Court explained that “a plaintiff's obligation to provide the grounds of his entitle[ment] to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above the speculative level . . . .” Id. at 555 (internal quotation marks and citations omitted) (alteration in original). “To state a valid claim, a complaint must contain either direct or inferential allegations respecting all the material elements to sustain recovery under some viable legal theory.” LULAC v. Bredesen, 500 F.3d 523, 527 (6th Cir. 2007).

         The Supreme Court clarified the concept of “plausibilty” in Ashcroft v. Iqbal, 556 U.S. 662 (2009), explaining that “[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Id. at 678.” Thus, “[t]o survive a motion to dismiss, a litigant must allege enough facts to make it plausible that the defendant bears legal liability. The facts cannot make it merely possible that the defendant is liable; they must make it plausible. Bare assertions of legal liability absent some corresponding facts are insufficient to state a claim.” Agema v. City of Allegan, 826 F.3d 326, 331 (6th Cir. 2016) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).

         In ruling on a motion to dismiss, the Court may consider the complaint as well as (1) documents that are referenced in the plaintiff's complaint and that are central to plaintiff's claims, (2) matters of which a court may take judicial notice (3) documents that are a matter of public record, and (4) letters that constitute decisions of a governmental agency. Thomas v. Noder-Love, 621 Fed.Appx. 825, 829 (6th Cir. 2015) (“Documents outside of the pleadings that may typically be incorporated without converting the motion to dismiss into a motion for summary judgment are public records, matters of which a court may take judicial notice, and letter decisions of governmental agencies.”) (Internal quotation marks and citations omitted); Armengau v. Cline, 7 Fed.Appx. 336, 344 (6th Cir. 2001) (“We have taken a liberal view of what matters fall within the pleadings for purposes of Rule 12(b)(6). If referred to in a complaint and central to the claim, documents attached to a motion to dismiss form part of the pleadings. . . . [C]ourts may also consider public records, matters of which a court may take judicial notice, and letter decisions of governmental agencies.”); Greenberg v. Life Ins. Co. Of Virginia, 177 F.3d 507, 514 (6th Cir. 1999) (finding that documents attached to a motion to dismiss that are referred to in the complaint and central to the claim are deemed to form a part of the pleadings). Where the claims rely on the existence of a written agreement, and plaintiff fails to attach the written instrument, “the defendant may introduce the pertinent exhibit, ” which is then considered part of the pleadings. QQC, Inc. v. Hewlett-Packard Co., 258 F.Supp.2d 718, 721 (E.D. Mich. 2003). “Otherwise, a plaintiff with a legally deficient claims could survive a motion to dismiss simply by failing to attach a dispositive document.” Weiner v. Klais and Co., Inc., 108 F.3d 86, 89 (6th Cir. 1997).

         III. ANALYSIS

         Steen now argues that, assuming all of the allegations of Plaintiff's Complaint to be true, the Complaint does not state a plausible claim for relief against Steen because: (1) any fraud claim is barred by the Hart/Economic Loss doctrine; (2) Steen is protected from personal liability under the Michigan limited liability statute; and (3) ...


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