Egenberg v. Mainsail Digital LLC et al
MEMORANDUM OPINION AND ORDER-For the reasons stated herein, the motion to dismiss counterclaim 13 is GRANTED. Mainsail and Moore have not requested, in the alternative or otherwise, to amend their counterclaim complaint; however, nothing in this memorandum opinion and order is intended to prevent the parties from amending their pleadings as provided for in the Scheduling Order 12 and the Federal Rules of Civil Procedure. Signed by Magistrate Judge John H England, III on 04/27/2021. (AKD)
2021 Apr-27 PM 12:57
U.S. DISTRICT COURT
N.D. OF ALABAMA
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
MAINSAIL DIGITAL, LLC, et al.,
Case Number: 2:21-cv-00026-JHE
MEMORANDUM OPINION AND ORDER1
Plaintiff Bradley Egenberg (“Egenberg”) initiated this action against Defendants Mainsail
Digital, LLC (“Mainsail”) and Douglass Moore (“Moore”) by filing a Complaint in this Court.
(Doc. 1). Egenberg, a minority member of Alliance Injury Group (“AIG”) and Legal Management
Solutions (“LMS”) (collectively, the “Companies”), asserts claims against Mainsail, also a
member of the Companies, and Moore, a third-party, arising out of conduct relating to the two
Companies. (See id.). In response to the Complaint, Defendants collectively filed an Answer and
Counterclaims against Egenberg. (Doc. 5). Count Three of Defendants’ Counterclaims alleges a
tortious interference claim against Egenberg. (Id. at 33). Egenberg moves to dismiss the tortious
interference counterclaim, contending there is no allegation that he is a stranger to the AIG and
LMS contracts with which he allegedly interfered. (Doc. 13). The motion is fully briefed and ripe
for review. (Docs. 13 & 16). Because there are no allegations to support Egenberg being a stranger
In accordance with the provisions of 28 U.S.C. § 636(c) and Federal Rule of Civil
Procedure 73, the parties have voluntarily consented to have a United States Magistrate Judge
conduct any and all proceedings, including trial and the entry of final judgment. (Doc. 10).
to the contracts at issue, the motion to dismiss Count Three of the Counterclaim (doc. 13) is
I. Standard of Review
Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain “a short and plain
statement of the claim showing the pleader is entitled to relief.” “[T]he pleading standard Rule 8
announces does not require ‘detailed factual allegations,’ but it demands more than an unadorned,
the-defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Mere “labels and conclusions”
or “a formulaic recitation of the elements of a cause of action” are insufficient. Iqbal, 556 U.S. at
678. (citations and internal quotation marks omitted). “Nor does a complaint suffice if it tenders
‘naked assertion[s]’ devoid of ‘further factual enhancement.” Id. (citing Twombly, 550 U.S. at
Rule 12(b)(6), Fed. R. Civ. P., permits dismissal when a complaint fails to state a claim
upon which relief can be granted. “To 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 (citations and internal quotation marks omitted). A complaint states a
facially plausible claim for relief “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. (citation
omitted). The complaint must establish “more than a sheer possibility that a defendant has acted
unlawfully.” Id. See also Twombly, 550 U.S. at 555 (“Factual allegations must be enough to raise
a right to relief above the speculative level.”). Ultimately, this inquiry is a “context-specific task
that requires the reviewing court to draw on its judicial experience and common sense.” Iqbal,
556 U.S. at 679.
II. Factual Allegations2
The original lawsuit arises out of activities concerning the Companies, AIG and LMS.
(Doc. 5 at 29, ¶10). Egenberg is a member of both AIG and LMS, holding a 25% interest in each
company. (Id. at ¶¶11, 12 ). Defendant Mainsail3 is also a member and holds the remaining 75%
interest in both AIG and LMS. (Id. at ¶13). As a member, Egenberg, through voting power,
maintains the right to direct and oversee AIG and LMS. (Id. at ¶ 39) (citing ALA. CODE § 10A4A-4.07(b)(1)(A)).4
AIG and LMS held contracts with third-party law firms to perform work in exchange for
consideration. (Doc. 5 at ¶48). The substance of the tortious interference claim is based on the
allegation that “[w]hile a member of AIG and LMS, Egenberg contacted multiple clients and
instructed them to discontinue doing business with AIG and LMS.” (Id. at ¶49). Defendant Moore
is not a member of AIG, LMS, or Mainsail. (Id. at ¶17). There are no further allegations regarding
“When considering a motion to dismiss, all facts set forth in the complaint ‘are to be
accepted as true and the court limits its consideration to the pleadings and exhibits attached
thereto.’” Grossman v. Nationsbank, N.A., 225 F.3d 1228, 1231 (11th Cir. 2000) (quoting GSW,
Inc. v. Long Cnty., 999 F.2d 1508, 1510 (11th Cir. 1993)). In other words, the “facts” are taken
directly from the complaint.
Mainsail has two members, each with 50% interest in the company. (Doc. 5 at ¶15).
Mainsail and Moore point out that, in his answer to their Counterclaim Complaint,
Egenberg denies he has the right to control or oversee the Companies, he denies he can influence
decisions of the companies, and he denies he can challenge the Companies’ decisions through his
voting power. (Doc. 16 at 7-8). However, at the motion to dismiss stage, all facts in the
complaint are to be accepted as true. See Grossman, 225 F.3d at 1231 (quoting GSW, Inc., 999
F.2d at 1510). Notably, Mainsail and Moore drafted the Counterclaim Complaint in which they
assert Egenberg had such right of control, influence, and challenge through his voting power.
(Doc. 5 at 32, ¶¶39-40).
the contracts at issue or Egenberg’s actions in the Counterclaim Complaint. (See doc. 5).
A. There Are No Allegations that Egenberg is a Stranger to Contractual Relationship.
To state a claim for intentional interference with a business relationship, the party asserting
the claim must allege, inter alia, “that the [alleged wrongdoer] is a ‘third party,’ i.e., a ‘stranger’
to the contract with which the [individual] allegedly interfered.” Tom's Foods, Inc. v. Carn, 896
So. 2d 443, 454 (Ala.2004) (citation omitted); see White Sands Group, LLC v. PRS II, LLC, 32 So.
3d 5, 14 (Ala. 2009). The alleged wrongdoer is not a stranger to a business or contractual
relationship if he “has any beneficial or economic interest in, or control over, that relationship.”
Tom’s Food Inc., 896 So. 2d at 454 (citation omitted); see also Waddell & Reed, Inc. v. United
Investors Life Ins. Co., 875 So.2d 1143, 1157 (Ala.2003). Egenberg contends the tortious
interference counterclaim must be dismissed because Mainsail and Moore cannot state a claim that
he tortiously interfered with AIG and LMS’s contracts because there are no allegations to support
that Egenberg is not a stranger to those agreements—but, instead, the allegations show he is not a
stranger because they establish he had a financial/economic interest in those contracts as a result
of his membership interest in both AIG and LMS. (Doc. 13 at 2).
As Egenberg points out (doc. 13 at 5), there are no allegations to support that Egenberg is
a third-party or a stranger to the AIG and LMS’s contractual relationships with which he allegedly
interfered. To the contrary, Mainsail and Moore allege Egenberg is a member of both AIG and
LMS. (See doc. 5 at ¶11, 12). As a member of AIG and LMS, Egenberg would have an economic
interest in AIG and LMS’s contracts. See Mitchell Co., Inc. v. Campus, III, No. 08-0342-KD-C,
2009 WL 3527744, *11 (S.D. Ala. Oct. 23, 2009). (“Moreover, Saint is a managing member of
both LLCs and so has an economic interest in the LLCs' relationships. Thus, under Alabama law
neither Saint nor TMC is a stranger to Campus' relationship with the LLCs, which is fatal to
Mainsail and Moore argue that, even though Egenberg is a member of AIG and LMS, he
is a stranger to the contractual relationships he is alleged to have interfered with. (Doc. 16 at 3).
Specifically, they argue that Egenberg’s financial interest in AIG and LMS is insufficient to negate
his stranger status as it relates to the specific contractual relationships when he had no right of
control or participating in the contracts at issue. (Id. at 6). They further argue that Egenberg did
not offer any proof that he was not involved in drafting the contracts or that he was responsible for
performing any duties under the contracts, that he brought in the clients that are parties to the
contracts, or that he would express the terms or details of the specific contracts. (Id. at 5). This
argument impermissibly flips the burden from the parties asserting the claim to the party defending
the claim. The burden to state a claim is on Mainsail and Moore, as the parties asserting the tortious
interference claim, to sufficiently allege Egenberg was a stranger to the contractal relationships at
issue. See Parsons, 849 849 So. 2d at 937. Although Mainsail and Moore are correct, that the
court should look at whether there are allegations Egenberg was a stranger to the contractual
relationships at issue and not a stranger to AIG and LMS generally, they fail to point to any
allegations in the counterclaim complaint that show they have alleged that Egenberg is a stranger
to the contractual relationships or contracts at issue.
As outlined above, the case law plainly states the alleged wrongdoer “is a party in interest
to a relationship if [he] has any beneficial or economic interest in, or control over, that
relationship.” Waddell & Reed, Inc., 875 So. 2d at 1154. (emphasis added). The counterclaim
complaint alleges Egenberg is a 25% member of both AIG and LMS, and the contractual
relationships he allegedly interfered with were between those companies and third-party law firms
to perform work in exchange for consideration. (Doc. 5 at ¶¶11, 12, 48). The complaint also
alleges that, as a member, Egenberg, through voting power, maintains the right to direct and
oversee AIG and LMS. (Id. at ¶ 39) (citing ALA. CODE § 10A-4A-4.07(b)(1)(A)). Thus, even
assuming that there could be some type of arrangement where Egenberg’s economic interests were
not impacted by the contracts at issue, Mainsail and Moore have not alleged any such facts in their
counterclaim complaint. Thus, Mainsail and Moore have not alleged Egenberg is a stranger to the
contractual relationships at issue.
B. Stating an Interference Tort When the Alleged Wrongdoer is Not a “Stranger”
When the alleged wrongdoer is not a stranger to the contractual relationship, Alabama law
permits a claim of intentional interference with business relationships against an individual officer
or employee with regard to “business or contractual relations to which their corporation or
employer is a party.” Perlman v. Shurett, 567 So. 2d 1296, 1299 (Ala. 1990) (quoting Hickman v.
Winston Cty. Hosp. Bd., 508 So. 2d 237, 241 (Ala. 1987) (Adams, J., concurring)). However, such
an intentional interference claim is only viable where the officer or employee “act[ed] outside their
scope of employment and [acted] with actual malice.” Id. (quoting Hickman, 508 So. 2d at 239).
An action outside the scope of employment is the same as an action outside of the employee’s
scope of authority. McGlathery v. Ala. A&M Univ., 105 So. 3d 437, 447 (Ala. Civ. App. 2012).
And, “in order to show malice[, there must be] a strong showing of a pattern of interference,”
which requires “more than an isolated incident” of actions beyond the scope of the alleged
interferer’s employment. Id. In response to the motion to dismiss, Mainsail and Moore do not
argue for the application of such a tort, and there are no such allegations in their counterclaim
complaint to support such a claim.
For the reasons stated above, the motion to dismiss counterclaim (doc. 13) is GRANTED.5
Mainsail and Moore have not requested, in the alternative or otherwise, to amend their
counterclaim complaint; however, nothing in this memorandum opinion and order is intended to
prevent the parties from amending their pleadings as provided for in the Scheduling Order (doc.
12) and the Federal Rules of Civil Procedure.
DONE this 27th day of April, 2021.
JOHN H. ENGLAND, III
UNITED STATES MAGISTRATE JUDGE
Mainsail and Moore request oral argument. (Doc. 16 at 1). Because oral argument
would not be beneficial to the resolution of this motion, the request is denied.
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?