United States District Court, M.D. Alabama, Northern Division
REPORT AND RECOMMENDATION
A. Baker United States Magistrate Judge
Christopher Jarvis filed a Complaint in this Court against
Defendants T. Britt Taylor, Norman Chandler, James R.
Johnson, and Taylor Chandler, LLC (“Taylor
Chandler”) (collectively, “Defendants”),
alleging claims of breach of implied covenant of good faith,
fraudulent inducement, negligence, breach of contract,
tortious interference with contract, tortious interference
with business relationships, wantonness, civil conspiracy,
and accounting. (Docs. 1, 6). Defendants filed a
counter-claim against Plaintiff alleging three counts of
breach of contract, breach of fiduciary duty, negligence,
breach of loyalty, and fraud and suppression. (Doc. 10).
matter is before the court on Plaintiff's motion to
dismiss the counterclaims for breach of loyalty, negligence,
and fraud for failure to state a claim upon which relief can
be granted. (Doc. 13). The motion is fully briefed and the
arguments are taken under submission on the record without
matter jurisdiction is conferred by 28 U.S.C. § 1332 as
to the parties' state law causes of action. The parties
do not contest personal jurisdiction or venue, and there are
adequate allegations to support both. See 28 U.S.C.
§ 1391. On June 29, 2017, this matter was referred to
the undersigned by U.S. Chief District Judge W. Keith Watkins
for disposition or recommendation on all pretrial matters.
(Doc. 4). See also 28 U.S.C. § 636(b); Rule 72,
Fed. R. Civ. P.; United States v. Raddatz, 447 U.S.
667 (1980); Jeffrey S. v. State Board of Education of
State of Georgia, 896 F.2d 507 (11th Cir. 1990).
BACKGROUND AND STATEMENT OF FACTS
was a life insurance broker who owned a company called Jade
Risk, LLC (“Jade Risk”) with its principal place
of business in Texas. (Doc. 10 at ¶¶ 6, 10). On
July 1, 2016, Defendants purchased Jade Risk from
Jarvis pursuant to the terms of a Membership
Interest Purchase Agreement. Id. at ¶ 9.
Defendants Taylor Chandler hired Plaintiff as an employee
simultaneously with the aforementioned sale. Id. at
¶ 15. As part of the sale of Jade Risk, Plaintiff
provided Defendants with a spreadsheet for a 2016 forecast of
Jade Risk clients that included 58 clients, of which,
Defendants allege that “19 were entirely fabricated
by” Plaintiff. Id. at ¶ 18. Defendants
further alleged that Plaintiff suppressed from Defendants
that he “planned on shutting down 24 of the other
[clients] by the end of 2016.” Id. at ¶
19. “As part of the closing, [Plaintiff] also executed
a Membership Interest Purchase Agreement (the ‘Purchase
Agreement'), an employee agreement (the ‘Employee
Agreement'), and a restrictive covenants agreement (the
‘Restrictive Covenants Agreement').”
Id. at ¶ 32. Defendants allege that Plaintiff
engaged in a number of actions that “violated the
aforementioned provisions of the Purchase Agreement, the
Employment Agreement, and the Restrictive Covenants
Agreement.” Id. at ¶ 57.
STANDARD OF REVIEW
12(b)(6) motion to dismiss tests the sufficiency of the
Complaint against the legal standard set forth in Rule 8:
“a short and plain statement of the claim showing that
the pleader is entitled to relief.” Fed.R.Civ.P.
evaluating a motion to dismiss pursuant to Rule 12(b)(6), the
court must take “the factual allegations in the
complaint as true and construe them in the light most
favorable to the plaintiff.” Pielage v.
McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008).
However, “the tenet that a court must accept as true
all of the allegations contained in a complaint is
inapplicable to legal conclusions.” Ashcroft v.
Iqbal, 556 U.S. 662, 663 (2009). “[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.”
Twombly, 550 U.S. at 555.
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570 (2007)).
“Determining whether a complaint states a plausible
claim for relief [is] ... a context-specific task that
requires the reviewing court to draw on its judicial
experience and common sense.” Id. at 663
(alteration in original) (citation omitted). “[F]acial
plausibility” exists “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. (citing Twombly, 550
U.S. at 556).
standard also “calls for enough facts to raise a
reasonable expectation that discovery will reveal
evidence” of the claim. Twombly, 550 U.S. at
556. While the complaint need not set out “detailed
factual allegations, ” it must provide sufficient
factual amplification “to raise a right to relief above
the speculative level.” Id. at 555.
when the allegations in a complaint, however true, could not
raise a claim of entitlement to relief, ‘this basic
deficiency should ... be exposed at the point of minimum
expenditure of time and money by the parties and the
court.'” Twombly, 550 U.S. 558 (quoting 5
Wight & Miller § 1216, at 233-34 (quoting in turn
Daves v. Hawaiian Dredging Co., 114 F.Supp.
643, 645 (D. Haw. 1953)) (alteration original). “[O]nly
a complaint that states a plausible claim for relief survives
a motion to dismiss.” Iqbal, 556 U.S. at 679
(citing Twombly, 550 U.S. at 556).
keeping with these principles a court considering a motion to
dismiss can choose to begin by identifying pleadings that,
because they are no more than conclusions, are not entitled
to the assumption of truth. While legal conclusions can
provide the framework of a complaint, they must be supported
by factual allegations. When there are well-pleaded factual
allegations, a court should assume their veracity and then
determine whether they plausibly give rise to an entitlement
to relief.” Iqbal, 556 U.S. at 679.