United States District Court, N.D. Alabama, Middle Division
OWEN BOWDRE CHIEF UNITED STATES DISTRICT JUDGE
matter comes before the court on Defendant Synergi Holdings,
Inc.'s Motion to Dismiss. (Doc. 15). Plaintiff Hiring
Automation, LLC, filed this case against Synergi, Simple
Onboard, LLC, Neon Workforce Technologies, Inc., and Shannon
Scott in this court on May 21, 2018, (doc. 1), and amended
its complaint on August 14, (doc. 13). Synergi then filed a
motion to dismiss Counts II, III, and V of Hiring
Automation's amended complaint as those counts relate to
Synergi. (Doc. 15). For the reasons below, the court WILL
GRANT Synergi's motion to dismiss Count III and DENY
Synergi's motion to dismiss Counts II and V.
Hiring Automation alleges that it agreed to sell its software
known as “Click Onboard” to Defendant Simple
Onboard in 2015. As part of this Software Acquisition
Agreement, Simple Onboard allegedly agreed to pay Hiring
Automation a sum certain, an ongoing royalty fee, and a
portion of the sales price in the event a third party
purchased either Click Onboard or Simple Onboard. Plaintiff
also alleges that Defendant Neon Workforce agreed to
guarantee Simple Onboard's obligations under the Software
Acquisition Agreement, though Hiring Automation does not
provide any additional details about the relationship between
Simple Onboard and Neon Workforce.
Automation alleges that Simple Onboard breached the Software
Acquisition Agreement and owes Hiring Automation money.
Hiring Automation alleges that Neon Workforce also owes it
money as Simple Onboard's guarantor under the Software
to the formation and alleged breach of the Software
Acquisition Agreement, Defendant Synergi purchased all of
Neon Workforce's stock in exchange for notes payable to
Neon Workforce's three shareholders, one of whom was
Defendant Shannon Scott. (Docs. 12 at ¶ 14; 15-1 at 11).
So Synergi now fully owns Neon Workforce and still owes Mr.
Scott under the terms of the Stock Purchase Agreement. (Doc.
15-1 at 12-13).
Stock Purchase Agreement between Synergi and Neon
Workforce's former shareholders includes a standard
indemnification clause, under which the selling shareholders
must indemnify Synergi for any losses it incurs as a result
of undisclosed Neon Workforce liabilities. (Doc. 15-1 at 19,
44). The Stock Purchase Agreement also provides that neither
“Neon nor any of its Subsidiaries is a guarantor or
otherwise is liable for any Liability (including
indebtedness) of any other Person.” (Id., at
Automation's amended complaint does not allege any
wrongdoing against Synergi. But Hiring Automation alleges
that by owning Neon Workforce, which guaranteed Simple
Onboard's payments under the Software Acquisition
Agreement, Synergi is a proper defendant in this case as to
Counts II, III, and V.
II of Hiring Automation's amended complaint requests an
accounting of Simple Onboard and Neon Workforce's
financial records. It also includes Synergi to the extent
that “Synergi has either merged its operations with
Neon, has absorbed Neon's accounting function or
otherwise has the accounting records of Neon.”
III of the amended complaint alleges that the indemnification
clause in the Stock Purchase Agreement between Synergi and
Mr. Scott created an express trust, with Synergi as trustee
and any undisclosed Neon Workforce creditor as a beneficiary.
As an alleged creditor of Neon Workforce, Hiring Automation
brings this claim as beneficiary against Synergi to enforce
its rights under the alleged express trust.
alternative claim, Count V of Hiring Automation's amended
complaint requests this court to impose a constructive trust
on the funds Neon Workforce allegedly owes Hiring Automation,
which Synergi now controls.
court found as moot Synergi's original motion to dismiss
after Hiring Automation amended its original complaint. (Doc.
14). In a largely similar motion to dismiss the amended
complaint, Synergi now moves the court to dismiss it from all
three claims, arguing that Hiring Automation's amended
complaint does not state a cause of action against it.
Synergi also argues that Hiring Automation has not pled facts
sufficient to pierce Neon Workforce's corporate veil and
hold Synergi liable for Neon Workforce's debt as its
Automation simultaneously filed its amended complaint and
response to Synergi's motion to dismiss the original
complaint. (Docs. 12-13). But Hiring Automation did not
timely file, and indeed never filed, any response to
Synergi's motion to dismiss the amended