JOHN MICHAEL VAZQUEZ, District Judge.
This matter comes before the Court on Defendant Power Play Marketing Group, LLC's Motion to Dismiss the Amended Complaint. D.E. 7. The Court reviewed all submissions made in support of the motion and considered the motion without oral argument pursuant to Fed. R. Civ. P. 78(b) and L. Civ. R. 78.1(b). For the reasons set forth below, the motion is
Plaintiff Dialectic Distribution, LLC is a New Jersey company "in the business of selling wholesale electronic products." Am. Compl. ¶ 1, D.E. 4. Defendant Power Play Marketing Group, LLC is a Minnesota company "in the business of purchasing electronic products and re-selling them to the public." Id. ¶ 2. Plaintiff purchased 2,500 Nabi Big Tab 20" tablets ("Tablets") for $331,250 from Defendant for resale. Id. ¶¶ 3-4, Ex. A. The only terms contained in the invoice memorializing the sale ("Invoice") are the identity of the parties, date, total due, product description, quantity, rate, that "Net 30" terms apply, and a "PO # Reference" to number "616." Id., Ex. A. Purchase Order #616 ("Purchase Order") contains several additional provisions, including "[m]ust have 1 year warranty directly back to [the manufacturer]. If not PPM must take back any defectives we have trouble returning it."
After Plaintiff purchased and resold the Tablets, many of its customers returned them due to battery and near field communication ("NFC") problems. Am. Compl. ¶¶ 1, 5. Plaintiff alerted Defendant to the problems and sought a refund, but Defendant denied any liability and asserted that Plaintiff should seek recourse from the manufacturer. Id. ¶¶ 6-7, Ex. B. The manufacturer, in turn, told Plaintiff that Defendant was liable. Id. ¶ 8. Defendant then ignored Plaintiff's renewed requests to accept return of the Tablets and Plaintiff filed this lawsuit. Id. ¶ 9-11.
Plaintiff alleges liability for breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment, and seeks compensatory damages, attorneys' fees, and interests and costs. Defendant filed the present Motion to Dismiss ("Motion"), D.E. 7, Plaintiff Opposed ("Opposition"), D.E. 8, and Defendant Replied ("Reply"), D.E. 9.
Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint if the plaintiff fails to state a claim upon which relief can be granted. The movant bears the burden of showing that no claim has been stated. Hedges v. United States, 404 F.3d 744, 750 (3d Cir. 2005). "[A]ll allegations in the complaint must be accepted as true, and the plaintiff must be given the benefit of every favorable inference to be drawn therefrom." Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011). But the court is not required to accept as true "legal conclusions," and "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
To survive a 12(b)(6) motion, "a complaint must contain sufficient factual matter . . . to `state a claim to relief that is plausible on its face.'" Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). "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. "The plausibility standard is not akin to a `probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id.
Defendant argues the breach of contract claim should be dismissed because the Amended Complaint contains no allegation that it "violated any actual provision of any actual contract between the parties." Mot. at 4. Plaintiff counters that the facts alleged "establish that Defendant offered certain electronics, valued at certain amounts, but that the Plaintiff did not receive what was offered — instead, Plaintiff received defective electronics of lower value than advertised." Opp. at 7. Plaintiff also relies on the Purchase Order's terms in asserting "[i]t is clear that the parties contemplated a return of defective products . . . and that Defendant has refused to abide by this agreement." Opp. at 8.
Breach of contract consists of four elements: (1) the parties entered into a contract; (2) the plaintiff performed under the contract; (3) the defendant breached the contract; and (4) the breach caused an alleged loss. Globe Motor Co. v. Igdalev, 139 A.3d 57, 64 (N.J. 2016) (quoting Model Jury Charge (Civil), § 4.10A "The Contract Claim-Generally" (1998)). As to the third element, to provide the required notice to a defendant, a complaint must allege which provision of a contract the defendant breached, and how the defendant breached it. See GKE Enterprises, LLC v. Ford Motor Credit Co. LLC USA, No. 09-cv-4656(JLL), 2010 WL 2179094, at *3 (D.N.J. May 26, 2010).
Here, Plaintiff failed to adequately plead the third element—that Defendant breached the contract. Plaintiff alleges a breach due to Defendant delivering defective products and refusing to accept return. Am. Compl. ¶ 12.1.
Plaintiff's counterarguments are unpersuasive. Plaintiff fails to sufficiently articulate how the Tablets were of "lower value than advertised." Opp. at 7. More importantly, this allegation is not in the Amended Complaint, and Plaintiff may not amend its pleading through its briefing. Further, as to the argument that the parties "contemplated a return of defective products," Opp. at 7, the Purchase Order required Defendant to accept return of defective Tablets only absent a "1 year warranty directly back to [the manufacturer]," Purchase Order. Count One contains no allegation that Defendant failed to secure the warranty, see Am. Compl. ¶¶ 3-14.1.
Plaintiff asserts liability for violating the covenant of good faith and fair dealing due to Defendant's refusal "to recompense the Plaintiff for the defective" Tablets. Opp. at 10. Defendant argues that the claim should be dismissed because (1) it is based on the same allegations as the breach of contract claim; and (2) there is no allegation of bad motive or intent by Defendant. Mot. at 11.
"Every party to a contract . . . is bound by a duty of good faith and fair dealing in both the performance and enforcement of the contract." Brunswick Hills Racquet Club, Inc. v. Route 18 Shopping Ctr. Assocs., 864 A.2d 387, 395 (N.J. 2005). "Although the implied covenant of good faith and fair dealing cannot override an express term in a contract, a party's performance under a contract may breach that implied covenant even though that performance does not violate a pertinent express term." Wilson v. Amerada Hess Corp., 773 A.2d 1121, 1126 (N.J. 2001). "As a general rule, subterfuges and evasions in the performance of a contract violate the covenant . . . even though the actor believes his conduct to be justified." Brunswick Hills Racquet Club, Inc., 864 A.2d at 396 (brackets and citations omitted) (finding violation where landlord evaded tenant's attempt to schedule closing on an option landlord knew tenant intended to exercise). "However, bad motive or intention is essential, and an allegation of bad faith or unfair dealing should not be permitted to be advanced in the abstract and absent improper motive." Elliott & Frantz, Inc. v. Ingersoll-Rand Co., 457 F.3d 312, 329 (3d Cir. 2006) (citations omitted).
Here, Plaintiff failed to adequately plead facts from which a bad motive or intent can be inferred, and thus the claim is dismissed. While Plaintiff does allege Defendant "ignored th[eir] request and refused to respond," Am. Compl. ¶ 11, and "subterfuges and evasions in the performance of a contract violate the covenant," Brunswick, 864 A.2d at 396, the circumstances here are materially distinct from those in Brunswick Hills Racquet Club, Inc. v. Route 18 Shopping Center Association. In Brunswick Hills, a tenant notified its landlord of its intent to exercise a lease option nineteen months before the option's deadline, but mistakenly believed payment was not due until closing. Id. at 398. While execution of the option remained unperfected, the landlord "engaged in a pattern of evasion, sidestepping every request by plaintiff to discuss the option and ignoring plaintiff's repeated . . . entreaties to move forward on closing." Id. Thus, the landlord had the requisite bad intent because it "lulled plaintiff into believing it had exercised the lease option properly" before refusing to honor it. Id. at 399. Here, Plaintiff makes no allegation of similar, bad-faith conduct. For example, Plaintiff does not plead facts indicating that Defendant knew that the Tablets were defective before Defendant delivered them to Plaintiff. As a result, Defendant's motion is also granted as to Count II, and this claim is
Plaintiff alleges unjust enrichment liability based on Defendant's representations that the Tablets were new, free of defects, and included a warranty with the manufacturer, despite knowing those representations were false. Am. Compl. ¶¶ 17-19. Defendant is purportedly liable because it "failed to honor the Contract by failing to provide a return of the monies for the defective products." Id. ¶ 20. Defendant argues that the unjust enrichment claim should be dismissed because the sale was covered by an express contract. Mot. at 9.
Under New Jersey law, "where there is an express contract covering the identical subject matter of the claim, plaintiff[s] cannot pursue a quasi-contractual claim for unjust enrichment." Royale Luau Resort, LLC, 2008 WL 482327, at *10 (brackets and citations omitted). However, plaintiffs may plead mutually-exclusive, alternative theories of liability. FRCP 8(d)(3).
Nevertheless, Plaintiff's unjust enrichment claim fails the facial plausibility standard because it expressly relies on a contract. Plaintiff incorporates paragraphs 1-15 of the Amended Complaint into Count III. Am. Compl. ¶ 16.
Defendant moves to strike Plaintiff's prayers for relief in the form of attorneys' fees, interest, and costs because such relief is "unsupported by law." Mot. at 12. Plaintiff counters that it "is too premature" to decide the issue. Opp. at 13.
"The court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Fed. R. Civ. P. 12(f).
Garlanger v. Verbeke, 223 F.Supp.2d 596, 609 (D.N.J. 2002) (citations omitted).
Here, Defendant failed to explain how Plaintiff's prayer for attorneys' fees, interest, and costs would cause any prejudice or confuse the issues. See id.; Mot. at 12-13; Reply at 8-10. The Court will not award such damages absent evidence that Plaintiff is entitled to such relief. Therefore, Defendant's Motion to Strike is
Defendant moved to dismiss with prejudice. Mot. at 14. While Plaintiff did not request leave to amend, even when a party does not seek leave, district courts should expressly state whether a party may replead. See Shane v. Fauver, 213 F.3d 113, 116 (3d Cir. 2000). The decision is within the Court's discretion. Id. at 115. Denial is warranted in cases of "undue delay, bad faith or dilatory motive . . ., repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, [and] futility of amendment." Great W. Mining & Mineral Co. v. Fox Rothschild LLP, 615 F.3d 159, 174 (3d Cir. 2010) (quoting Foman v. Davis, 371 U.S. 178, 182 (1962)).
None of the conditions warranting dismissal with prejudice are present here. There is no evidence of undue delay, bad faith, or dilatory motive. See Shane, 213 F.3d at 116. Plaintiff has only amended its complaint once pursuant to Rule 15(a)(1)(B), see D.E. 4, and thus this Opinion is the first judicial scrutiny of the allegations. Regarding futility, Plaintiff could remedy the deficiencies identified above by (1) alleging Defendant failed to secure a warranty with the Tablet manufacturer in Counts One and Two, thus triggering the Purchase Order's return provision and rendering Defendant's refusal to respond to Plaintiff's demands a potential bad-faith act; (2) alleging liability based on applicable implied warranties; and (3) excluding fatal allegations of an existing contract in its unjust enrichment claim. Therefore, the Motion is
For the reasons set forth above, Defendant Power Play Marketing Group LLC's Motion to Dismiss the Amended Complaint is
Even assuming "[t]hese representations" refer to both sentences of paragraph 17, Plaintiff fails to incorporate paragraphs 17-18 into Counts One and Two, and the Court declines to do so sua sponte. See FRCP 8(c) ("A statement in a pleading may be adopted by reference elsewhere in the same pleading." (emphasis added)); see generally Amend. Compl. ¶¶ 3-15.2. The fact that paragraphs 17-18 are only part of Plaintiff's unjust enrichment claim, which is factually distinct from the breach of contract claim, undergirds the Court's decision. See Royale Luau Resort, LLC v. Kennedy Funding, Inc., No. 07-1342 HAA, 2008 WL 482327, at *10 (D.N.J. Feb. 19, 2008) (dismissing unjust enrichment claim because conduct covered by express contract).