MARK W. BENNETT, District Judge.
TABLE OF CONTENTS I. FACTUAL AND PROCEDURAL BACKGROUNDS ........................................888II. ISSUES ....................................................................889III. DISCUSSION ................................................................889A. Standard Of Review For Motion To Dismiss ..............................889B. Unreasonable Interference With Private Property .......................890C. Tortious Interference With Prospective Economic Benefit ...............893D. Malicious Prosecution .................................................895E. Abuse Of Process ......................................................897F. Claim For Attorneys' Fees .............................................899G. Whether To Dismiss ITC Holdings From This Litigation ..................901IV. CONCLUSION ................................................................902
In this Memorandum Opinion and Order, I address the motion to dismiss filed by the defendants, ITC Midwest LLC (ITC Midwest) and ITC Holdings Corp. (ITC Holdings), on June 11, 2015 (docket no. 6). Defendants move to dismiss, with prejudice, Counts III-VI of the plaintiff's petition, the claim for attorneys' fees, and ITC Holdings from this action.
Plaintiff Hawkeye Land Company (Hawkeye), is an Iowa corporation that "owns the right to sell easements across active railroad tracks," in certain areas in the Midwest, including Franklin County, Iowa. See Plaintiff's Resistance (docket no. 9), 3; see also Hawkeye Land Co. v. Iowa Utils. Bd., 847 N.W.2d 199, 201 (Iowa 2014). The defendants are ITC Midwest, a Michigan limited liability company, and ITC Holdings, a Michigan corporation. Plaintiff's Resistance Brief at 3. ITC Midwest is an independent electric transmission company, and ITC Holdings is the parent company and sole member of ITC Midwest. See id. at 2-3, 18; see also Hawkeye Land Co., 847 N.W.2d at 201. The present dispute arose in 2009 when the Iowa Utilities Board (IUB) permitted ITC Midwest to use a railroad-crossing statute (crossing statute), Iowa Code § 476.27,
On August 7, 2009, Hawkeye contested ITC Midwest's actions by filing a complaint with the IUB. Id. An Administrative Law Judge (ALJ) rejected Hawkeye's claims in a proposed decision on October 14, 2010: it "upheld the use of the pay-and-go procedure and denied compensation beyond the $750.00 per crossing." Id. at 201, 205. Hawkeye appealed the ALJ's proposed decision to the IUB. "IUB, asserting interpretative authority over section 476.27, reached the same conclusions in its final decision, and the district court affirmed on judicial review." Id. at 201, 206. Hawkeye appealed, and the Iowa Supreme Court retained the appeal.
The Iowa Supreme Court summarized Hawkeye's contentions on appeal as follows: "[Hawkeye] contends the crossing
Following the Iowa Supreme Court's decision, on June 6, 2015, Hawkeye filed a six-count petition (docket no. 4) in Franklin County, Iowa District Court, against ITC Midwest and ITC Holdings regarding the same three railroad crossings. Hawkeye alleged counts of (1) trespass; (2) unjust enrichment; (3) unreasonable interference with private property; (4) tortious interference with prospective economic benefit; (5) malicious prosecution; and (6) abuse of process. On June 5, 2015, the defendants removed this case to the United States District Court for the Northern District of Iowa (docket no. 1). On June 11, 2015, the defendants filed a motion to dismiss Counts III-VI of Hawkeye's petition, Hawkeye's claim for attorneys' fees, and ITC Holdings from this litigation. Hawkeye filed its resistance brief on June 24, 2015 (docket no. 9), following which the defendants filed their reply brief on July 6, 2015 (docket no. 17).
In this Memorandum Opinion and Order, I address whether Hawkeye has stated claims upon which relief may be granted as to its claims for: (1) unreasonable interference with private property (Count III); (2) tortious interference with prospective economic benefit (Count IV); (3) malicious prosecution (Count V); (4) abuse of process (Count VI); (5) attorneys' fees; and (6) relief against ITC Holdings. I also address whether oral argument is necessary in this case.
The defendants move to dismiss Hawkeye's action pursuant to Federal Rule of Civil Procedure 12(b)(6). Rule 12(b)(6) authorizes a pre-answer motion to dismiss for "failure to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). As the Eighth Circuit Court of Appeals has explained,
Richter v. Advance Auto Parts, Inc., 686 F.3d 847, 850 (8th Cir.2012); accord Freitas v. Wells Fargo Home Mortg., Inc., 703 F.3d 436, 438 (8th Cir.2013) (quoting Richter, 686 F.3d at 850); Whitney v. Guys, Inc., 700 F.3d 1118, 1128 (8th Cir. 2012) (stating the same standards).
Courts consider "plausibility" under this Twom-bal standard
Gallagher v. City of Clayton, 699 F.3d 1013, 1016 (8th Cir.2012); Whitney, 700 F.3d at 1128 (stating the same standards).
With the above standards in mind, I turn to consider the defendants' motion to dismiss. In each section below, I initially discuss the requirements for the claim at issue, following which I analyze whether Hawkeye's factual allegations sufficiently state a plausible claim.
The first issue I consider is whether Hawkeye has stated a claim upon which relief may be granted as to its claim for unreasonable interference with private property. According to the defendants, "[a]n action for unreasonable interference with private property is a private nuisance action, as distinguished from a trespass
The Iowa legislature enacted a statutory nuisance provision under Iowa Code § 657.1, which is supplemented by the common law of nuisance. Miller v. Rohling, 720 N.W.2d 562, 567 (Iowa 2006). The Iowa legislature defined a "nuisance" under Iowa Code chapter 657.1 as follows:
IOWA CODE § 657.1 (emphasis added). Common law principles governing "private nuisances" supplement the above skeletal statutory provisions:
Perkins v. Madison County Livestock & Fair Ass'n, 613 N.W.2d 264, 271 (Iowa 2000) (quoting Weinhold v. Wolff, 555 N.W.2d 454, 459 (Iowa 1996), in turn quoting Bates, 154 N.W.2d at 857). "From this discussion, it is clear that whether a party has created and maintained a nuisance is ordinarily a factual question." Weinhold, 555 N.W.2d at 459 (citing Bates, 154 N.W.2d at 857).
Nuisance and trespass are related doctrines, but there are differences between them. On the one hand, a claim of trespass involves "an actionable invasion of interests in the exclusive possession of land," and "an actual invasion by tangible matter." Ryan, 4 N.W.2d at 438. On the other hand, a claim of nuisance is "an actionable invasion of interests in the use and enjoyment of land," the invasion "is usually by intangible substances, such as noises or odors," and "[i]t usually involves the idea of continuance or recurrence over a considerable period of time." Id. Despite these understood differences, the Iowa Supreme Court has explained, "[t]he line of demarcation between private nuisance and trespass is not always clear." Id. at 438-39. A trespass and a nuisance can arise from the same occurrence (e.g., cases involving the flooding of land), and "[i]n some instances trespasses of continuing character have been dealt with as nuisances." Id. at 439.
In this case, ITC Midwest's three power lines, which constitute tangible matter, physically cross Hawkeye's property. Hawkeye purchased the real estate before the defendants constructed the power lines. Although recognizing a nuisance generally involves intangible substances, Hawkeye cites the less common nuisance cases involving tangible substances, such as dust. Plaintiff's Resistance Brief at 9-10 (citing Miller, 720 N.W.2d at 565; Bates, 154 N.W.2d at 858). I also note that this case is not unlike the example in which person A's tree branches and roots constitute a private nuisance by encroaching onto person B's property. See, e.g., Lane v. W.J. Curry & Sons, 92 S.W.3d 355, 366 (Tenn.2002) (finding defendant's tree constituted a private nuisance where it "adversely affected the plaintiff's reasonable and ordinary use and occupation of her home, not to mention pos[ed] hazards to the plaintiff's health and safety.").
Hawkeye has sufficiently pled facts to state a claim for unreasonable interference with private property. Thus, defendants' motion to dismiss Count III is denied.
The second issue I consider is whether Hawkeye has stated a claim upon which relief may be granted as to its claim for tortious interference with prospective economic benefit. The defendants argue Hawkeye's factual allegations are "deficient" as to each element of its tortious interference claim. Defendants' Brief at 9. In reply, Hawkeye makes the case that it sufficiently pled facts, which allow me to draw the reasonable inference that the defendants intentionally interfered with Hawkeye's prospective business relations. See Plaintiff's Resistance Brief at 12. Thus, Hawkeye contends, Count IV of their petition should not be dismissed. See id.
The parties agree that, under Iowa law, there are five elements of a claim for tortious interference with prospective economic benefit:
Iowa Coal Min. Co., Inc. v. Monroe County, 555 N.W.2d 418, 438 (Iowa 1996). The Iowa Supreme Court has "recognized the tort of interference with prospective business advantage, explaining that Iowa law thereby protects expectancies of future contractual relations such as the `opportunity of obtaining customers.'" North v. State, 400 N.W.2d 566, 569 (Iowa 1987) (citations omitted); see also Page County Appliance Ctr. v. Honeywell, 347 N.W.2d 171, 177 (Iowa 1984).
The parties' briefs focus primarily on the first element of Hawkeye's tortious interference with prospective economic benefit claim. Relying on Nesler v. Fisher and Co., 452 N.W.2d 191, 198-99 (Iowa 1990), the defendants argue that the "plaintiff must identify the third party with whom there was a prospective business or contractual relationship for the first element to be satisfied." Defendants' Brief at 9. In response, Hawkeye admits that, in Nesler, 452 N.W.2d at 198-99, the case relied upon by the defendants, the jury
In Hagen v. Siouxland Obstetrics & Gynecology, P.C., 934 F.Supp.2d 1026, 1049 (N.D.Iowa 2013), a case that recently came before me, the parties similarly disputed whether the plaintiff "provided sufficient evidence of identifiable third parties" in relation to the plaintiff's tortious interference with prospective business advantage claim. Id. There, I explained that "the Iowa Supreme Court has not specifically addressed this element of the cause of action." Id. However, other courts in different jurisdictions persuasively addressed the issue, and I noted that "[i]n making a claim for tortious interference with prospective business relationships, it has been held that the prospective relationship may be with an identifiable class of third persons, not just an identified third person." Id. (citing Hayes, M.D. v. Northern Hills General Hospital, 590 N.W.2d 243, 250 (S.D.1999); Lamdin v. Aerotek Commercial Staffing, 2010 WL 3896154, *6 (E.D.Tenn.2010)). As I further explained in Hagen, in Hayes, the Supreme Court of South Dakota found that requiring third parties to be identified by name "`would render the tort for the most part, a nullity and, in all actuality, never allow a plaintiff to proceed with its claim beyond summary judgment especially if the business enterprise is dependent upon a large pool of clientele.'" Id. (quoting Hayes, M.D., 590 N.W.2d at 250). Hawkeye has pled sufficient facts as to its prospective business relationships with third parties to develop utility projects on its property in Franklin County, Iowa, which constitutes "an identifiable class of third persons." See id. Thus, I find that the first element was sufficiently pled at the motion to dismiss stage.
As to the second element, the defendants contend that Hawkeye failed to allege that ITC had knowledge of "any prospective contract." Defendants' Brief at 9. In reply, Hawkeye directs my attention to an Iowa Supreme Court decision, Revere Transducers, Inc. v. Deere & Co., 595 N.W.2d 751, 764 (Iowa 1999), and interprets it to mean that "knowledge of a specific contract is not necessary to support a cause of action even in the context of interference with an existing contract." Plaintiff's Resistance Brief at 11. In Nesler, the Iowa Supreme Court found that this second element was met by a showing that the defendants "had reason to know" of potential contracts and a "binding contract" was unnecessary for a claim of interference with prospective business advantage. Nesler, 452 N.W.2d at 196; see also Tompkins Lawncare, Inc. v. Buchholz, No. 03-1284, 697 N.W.2d 126, 2005 WL 597016, *2 (Iowa Ct.App.2005) (unpublished op.). Here, the defendants were allegedly aware of Hawkeye's use of its property to develop competing power lines and get paid by third parties. See Plaintiff's Resistance Brief at 12. Therefore, ITC Midwest, an experienced independent transmission company, either knew or "had reason to know" of potential business relations and contracts Hawkeye may have formed. Nesler, 452 N.W.2d at 196. Thus, I find that the second element was sufficiently pled.
As to the third element, the defendants argue that Hawkeye failed to provide sufficient facts to support the assertion that
As to the fourth element, the defendants contend that Hawkeye failed to allege that the defendants caused a third party not to form a contractual or business relationship with Hawkeye. Defendants' Brief at 9. Hawkeye counters that the defendants' trespasses onto Hawkeye's property "substantially interfered" with the development of competing power line projects, which caused Hawkeye to lose business opportunities. Plaintiff's Resistance Brief at 12. To put it another way, as a consequence of the defendants building power lines on Hawkeye's property, the defendants caused other projects that may have developed on Hawkeye's property to "fail to materialize." See Id.; see also Iowa Coal Min. Co., Inc., 555 N.W.2d at 438. These factual allegations convince me that the fourth element was sufficiently pled.
Finally, as to the fifth element, Hawkeye alleged that it incurred damages from the above described lost business opportunities. The defendants do not contest Hawkeye's factual allegations concerning the fifth element. Based on the facts alleged, I find that the fifth element was sufficiently pled.
For the above reasons, I conclude Hawkeye has sufficiently pled facts to state a claim for tortious interference with prospective business relations. Therefore, defendants' motion to dismiss Count IV is denied.
The third issue I consider is whether Hawkeye has stated a claim upon which relief may be granted as to its claim for malicious prosecution. Pursuant to Rule 12(b)(6), defendants contend that Hawkeye's malicious prosecution claim fails "as a matter of law." Defendants' Brief at 11. Hawkeye responds by asserting that it has brought an "actionable malicious prosecution claim upon which relief can be granted," and for that reason, I should not dismiss Hawkeye's claim. Plaintiff's Resistance Brief at 12.
Royce, 423 N.W.2d at 200.
As to the first element, "a previous prosecution," the Iowa Supreme Court made clear in Sergeant v. Watson Bros. Transp. Co. that "[t]he prosecution contemplated" in a malicious prosecution case "is a proceeding of a judicial character." 244 Iowa 185, 52 N.W.2d 86, 91 (1952) (emphasis added) (citing C.J.S., Malicious Prosecution, § 5). The Iowa Supreme Court has defined a "judicial proceeding" as "`one carried on in a court of justice [established]
Hawkeye Land Co., 847 N.W.2d at 205 (emphasis added). All of these facts persuade me that ITC Midwest's use of the crossing statute was not a "proceeding of a judicial character" and, therefore, the defendants did not bring a previous prosecution against Hawkeye. Sergeant, 52 N.W.2d at 91.
Because there was not a previous prosecution to form the basis of Hawkeye's malicious prosecution action, Hawkeye's claim must fail.
The fourth issue I consider is whether Hawkeye has stated a claim upon which relief may be granted as to its claim for abuse of process. Defendants contend that Hawkeye's claim for abuse of process
Under Iowa law, to prove a claim of abuse of process, a plaintiff must show: "(1) use of the legal process, (2) in an improper or unauthorized manner, and (3) that damages were sustained as a result of the abuse." Stew-Mc Development, Inc. v. Fischer, 770 N.W.2d 839, 849 (Iowa 2009). The first two elements of an abuse of process claim "focus largely on the actual misuse of otherwise properly issued legal process, and are easily contrasted with the elements of malicious prosecution, which focus primarily on the malicious institution of criminal proceedings without probable cause." Tomash v. John Deere Indus. Equipment Co., 399 N.W.2d 387, 390 (Iowa 1987). However, "[a]buse of process is similar to malicious prosecution in that the basis for both is the improvident use of the courts." Wilson, 464 N.W.2d at 266 (citing Note, A Lawyer's Duty to Reject Groundless Litigation, 26 WAYNE L.REV. 1561, 1565 (1980)). Moreover, abuse of process is "`the use of legal process, whether criminal or civil, against another primarily to accomplish a purpose for which it was not designed.'" Fuller v. Local Union No. 106 of United Bhd. of Carpenters & Joiners of Am., 567 N.W.2d 419, 421 (Iowa 1997) (citing Palmer v. Tandem Mgmt. Servs., Inc., 505 N.W.2d 813, 817 (Iowa 1993)).
The fighting issue, here, is whether the defendants' use of the crossing statute, Iowa Code § 476.27, constitutes "use of the legal process" under the first element of Hawkeye's abuse of process claim, even though the defendants did not file a formal complaint with the IUB or a civil lawsuit against Hawkeye in a court of law. To assist me in my analysis below, I turn to Van Stelton v. Van Stelton, in which I recently analyzed, in detail, the first element of an abuse of process claim:
994 F.Supp.2d 986, 992 (N.D.Iowa 2014).
Defendants rely on Dobratz v. Krier, No. 11-0120, 808 N.W.2d 756, 2011 WL 5867067, *1 (Iowa Ct.App. Nov. 23, 2011) (unpublished op.), a decision of the Iowa Court of Appeals, where the appellate court held that a claim for an abuse of process "requires misuse of a judicial process." See Defendants' Brief at 14. At the end of the appellate court's opinion in Dobratz, the court concluded by explaining its unwillingness to extend the abuse of process tort to include the abuse of administrative proceedings:
Dobratz, 2011 WL 5867067 at *4 (emphasis added). Hawkeye replies by citing to Gibson, 621 N.W.2d at 398-99, and argues that "[t]he Iowa Supreme Court has allowed abuse of process claims arising out of administrative actions." Plaintiff's Resistance Brief at 16. Hawkeye's reliance on Gibson is misplaced.
In Gibson, the Iowa Supreme Court held that the issue of whether the claimant was entitled to punitive damages on his abuse of process claim was for the jury. Gibson, 621 N.W.2d at 399. Gibson does not stand for the proposition that an administrative procedure will give rise to an abuse of process claim in conflict with the later holding in Dobratz, 2011 WL 5867067 at *4. Rather, in Gibson, because the defendant did "not appeal[ ] from the judgment in favor of [the plaintiff] on [the abuse of process claim]," the Supreme Court did not allow the defendant to "challenge the judgment." Id. In this case, ITC Midwest's use of the crossing statute, as permitted by the IUB, was not a "use of the process of the court." See Dobratz, 2011 WL 5867067, *4. Rather, the evidence shows that this case involves ITC Midwest's use of IUB's administrative regulations governing crossings in Iowa. Subsequent litigation was initiated in the court system only after Hawkeye decided to lodge its formal complaint with the IUB against ITC Midwest. See Hawkeye Land Co., 847 N.W.2d at 205. The defendants never initiated a civil lawsuit or filed a complaint with the IUB against Hawkeye. Thus, the first element is not factually plausible.
For these reasons, Hawkeye has not sufficiently pled facts as to the first element of its abuse of process claim. I need not consider the remaining elements of this claim. Hence, Hawkeye's abuse of process claim is dismissed.
The fifth issue I consider is whether Hawkeye has stated a claim upon which relief may be granted as to its claim for attorneys' fees as to all six counts. The crux of the defendants' argument is two-fold: (1) no statute or contract provides attorneys' fees in this matter and common law attorneys' fees are not warranted; and (2) "every Court and administrative agency presented with [Hawkeye's] fee claim denied it." Defendants' Brief at 15-17. In reply, Hawkeye urges that the issue of attorneys' fees is "not ripe, as it is unknown at this time whether or not Hawkeye may receive attorneys' fees." Plaintiff's Resistance Brief at 17. Even if the matter is ripe, Hawkeye argues that the Iowa Supreme Court in Hawkeye Land Co., 847 N.W.2d at 219, indicated that the issue of attorneys' fees will be resolved by later litigation, and Hawkeye is entitled to attorneys' fees based on "numerous legal theories" at common law. Id. at 18-19.
"Generally, a party has no claim for attorney fees as damages in the absence of a statutory or written contractual provision allowing such an award." Williams v. Sickel, 659 N.W.2d 572, 579 (Iowa 2003) (citing Hockenberg Equipment Co. v. Hockenberg's Equipment & Supply Co., 510 N.W.2d 153, 158 (Iowa 1993)). Under common law, "[c]ourts have recognized a rare exception to this general rule, however, `when the losing party has acted
Here, Hawkeye does not cite to any statutory provisions or a written contract between the parties authorizing an award of attorneys' fees. See Plaintiff's Resistance Brief at 17-19. Therefore, Hawkeye must prove that its claim for attorneys' fees is one of the "rare" instances where common law attorneys' fees may be awarded. See Hockenberg Equipment Co., 510 N.W.2d at 158. In advancing the contention that an award of common law attorneys' fees is justified, here, Hawkeye cites to Williams, 659 N.W.2d at 581. In Williams, the Iowa Supreme Court held that the county treasurer's conduct of fabricating documents after the start of trial and offering them as evidence at trial, with the intent to establish her case and defeat counterclaims against her, rose to the level of justifying attorneys' fees at common law. Plaintiff's Resistance Brief at 19. Drawing parallels to Williams, Hawkeye argues,
Id. "[A]ccepting as true all factual allegations in the complaint," as I am required to when considering a motion to dismiss for failure to state a claim, I find that Hawkeye has alleged a plausible factual basis as to the defendants' conduct to support an inference that this case is a "rare exception" in which recovery of attorneys' fees may be permissible under the common law. See Palmer, 666 F.3d at 1083; see also FED.R.CIV.P. 12(B)(6).
In addition, contrary to the defendants' arguments, the Iowa Supreme Court in Hawkeye Land Co. did not reject attorneys' fees for Hawkeye. Rather, as Hawkeye correctly asserted, the Iowa Supreme Court noted the issue would be resolved later: "Iowa Code chapter 6B governs the compensation owed Hawkeye for the crossing easements taken by ITC Midwest, as well as the related claims for attorney fees, costs and expenses." Hawkeye Land Co., 847 N.W.2d at 219; see also Plaintiff's Resistance Brief at 18. The Iowa Supreme Court then continued by explaining that "[c]ompensation and entitlement to fees cannot be determined until the procedures of chapter 6B are invoked." Id.; see also IOWA CODE §§ 6B.33-34 (these statutory provisions under Iowa Code chapter 6B govern the award of costs and attorneys' fees in condemnation proceedings). The Iowa Supreme Court's decision does not forbid Hawkeye's present claim for attorneys' fees based on its six causes of action.
Hawkeye has sufficiently pled facts that may allow me to draw the reasonable inference that Hawkeye may be entitled to attorneys' fees from the defendants at
The sixth issue I consider is whether ITC Holdings should be dismissed from this action. The defendants argue that ITC Holdings should be dismissed from this action because the power lines that Hawkeye complains about are owned and constructed by ITC Midwest, and only ITC Midwest attempted to use the crossing statute. Defendants' Brief at 18. "[ITC Midwest] is a Michigan limited liability corporation and ITC Holdings is its sole member."
Without citing to any authority, Hawkeye counters that I should not dismiss ITC Holdings as ITC Holdings is included in each count of Hawkeye's petition, and ITC Holdings was engaged in the parties' previous litigation, which gave rise to several of Hawkeye's claims here. "Even if ITC Holdings proves it is not actually engaged in the illegal activity," Hawkeye writes, "[ITC Holdings] still knowingly benefits from ITC Midwest's illegal activities that harm Hawkeye." Plaintiff's Resistance Brief at 20. Furthering this point, Hawkeye alleges that "ITC Midwest has presumably passed profits" to ITC Holdings for the six years that ITC Midwest has illegally and freely used Hawkeye's property. Id. Those profits, Hawkeye argues, have "unjustly enriched" ITC Holdings. Id.
"One of the hallmark features of a limited liability company is the limited liability of its members and managers." CCS, Inc. v. K & M Enterprises, L.L.C., No. 12-1213, 829 N.W.2d 193, 2013 WL 751284, *2 (Iowa Ct.App. Feb. 27, 2013) (citing IOWA CODE § 489.304 (2009)). "A member or manager is not liable for the `debts, obligations, or other liabilities of a limited liability company, whether arising in contract, tort, or otherwise' solely by reason of acting as a member or manager." Id. (citing IOWA CODE § 489.304 (2009)). Moreover, "[a] limited liability company is an entity distinct from its members." IOWA CODE § 489.104 (2009).
There are "exceptional circumstances" when a court will decide to "pierce the veil of a limited liability company and hold members or managers individually liable." CCS, Inc., 2013 WL 751284 at *2. For example, six factors support a court's decision to pierce the corporate veil, including: "(1) it is undercapitalized, (2) it is without separate books, (3) its finances are not separated from individual finances, (4) it pays an individual's obligations, (5) it is used to promote fraud or illegality, or (6) it is merely a sham." Northeast Iowa Co-Op. v. Lindaman, No. 13-0297, 843 N.W.2d 477, 2014 WL 69605, *9 (Iowa Ct.App.2014) (citing Briggs Transp. Co., Inc. v. Starr Sales Co., Inc., 262 N.W.2d 805, 810 (Iowa 1978)); see also Cemen Tech., Inc. v. Three D. Indus., L.L.C., 753 N.W.2d 1, 6 (Iowa 2008) (putting forth the six-step analysis for piercing an L.L.C.'s veil).
In this case, ITC Holdings is ITC Midwest's corporate parent, sole member, and owner, and it is shielded from liability under Iowa Code § 489.104. Hawkeye Land Co., 847 N.W.2d at 204; see also Defendants' Reply Brief at 5. Hawkeye
In addition, although ITC Holdings is included in each count of Hawkeye's petition, and ITC Midwest's acts were alleged to "have been through concerted action with ITC Holdings," the facts alleged to support liability on behalf of ITC Holdings are scant. It is merely alleged that ITC Holdings "knowingly benefits from ITC Midwest's illegal activities," and ITC Midwest "presumably passed profits" to ITC Holdings. Plaintiff's Resistance Brief at 20. Even if it is erroneous to apply the six factors of the piercing the corporate veil standard, facts as to ITC Holdings's specific involvement in ITC Midwest's construction and operation of the power lines are missing. I am left questioning whether ITC Holdings supervises any activities of ITC Midwest. Hawkeye also only equivocally asserts that ITC Holdings "presumably" received profits from ITC Midwest. Cf. Broadcast Music, Inc. v. Mooney Hollow Saloon LLC, No. C13-1038, 2014 WL 4384323, *2 (N.D.Iowa Sept. 3 2014) (slip op.) (denying motion to dismiss defendant, a member of an L.L.C., and finding plaintiff's allegations met Iqbal's pleading requirements and stated a plausible claim for individual liability where plaintiff asserted that defendant had primary responsibility for operation management of L.L.C., had a right and ability to supervise activities of L.L.C., and had a direct financial interest in L.L.C.). Agreeing with the defendants, Hawkeye has failed to plead sufficient factual content as to ITC Holdings's involvement in this action.
In sum, Hawkeye did not present sufficient factual allegations that allow me to draw the reasonable inference that ITC Holdings has liability for the counts asserted in Hawkeye's petition. Thus, defendants' motion to dismiss ITC Holdings is granted.
Accordingly, the defendants' motion to dismiss is granted in part and denied in part. I grant the defendants' motion to dismiss Hawkeye's Counts V and VI, but deny their motion to dismiss Hawkeye's Counts III and IV. Additionally, I deny the defendants' motion to dismiss the claim for attorneys' fees as Hawkeye sufficiently pled facts for the reasonable inference that attorneys' fees are recoverable under common law, and I granted the defendants' motion to dismiss ITC Holdings from this petition, as it is shielded by the limited liability laws of Iowa and the specific facts alleged to support liability on behalf of ITC Holdings were negligible. Pursuant to Local Rule 7(c), I deny the parties' requests for oral argument because good cause has not been shown for such a hearing. See Local Rule 7(c). As I have stated before, "the issue on a Rule 12(b)(6) motion to dismiss for failure to state a claim upon which relief can be granted is not whether a claimant will ultimately prevail, but whether the claimant is entitled to offer evidence in support of his, her, or its claims." Van Stelton, 994 F.Supp.2d at 994 (citing Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1973)). I anticipate that, in round two, the inevitable motions for summary judgment, I will have the opportunity to revisit the arguments of the parties.
Plaintiff's Resistance Brief at 8. None of the authorities cited by Hawkeye use the "abusive condemnation" language. Nor did I find any Iowa case law employing those terms. The defendants are correct that the cases relied on by Hawkeye — Nadler, Osborn, and Skaff — involve distinguishable facts where city defendants "repeatedly started, then stopped the condemnation process, until either the city completed condemnation or the plaintiff landowner brought a mandamus action to compel condemnation proceedings." Defendants' Brief at 2. The defendants are not municipalities or governmental bodies and Hawkeye did not assert a mandamus action to compel condemnation proceedings by the defendants. See Phelps v. Board of Sup'rs of Muscatine County, 211 N.W.2d 274, 276 (Iowa 1973) ("We have held on a number of occasions that mandamus is a proper remedy to compel condemnation when there has been a taking of private property for public use without just compensation.") (citations omitted). In agreement with the defendants, Hawkeye's unreasonable interference with private property claim is a private nuisance cause of action.
Kennedy, 601 N.W.2d at 64 (quoting RESTATEMENT (SECOND) OF TORTS § 586 (1977)).
