Townson v. Koch Farms, LLC et al
MEMORANDUM OPINION AND ORDER GRANTING IN PART and DENYING IN PART 11 MOTION for Partial Judgment on the Pleadings or, in the Alternative, Partial Summary Judgment as set out herein. Signed by Judge Virginia Emerson Hopkins on 4/22/2014. (JLC)
2014 Apr-22 PM 02:00
U.S. DISTRICT COURT
N.D. OF ALABAMA
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
KOCH FARMS, LLC,
) Case No.: 4:13-CV-1703-VEH
MEMORANDUM OPINION AND ORDER
Plaintiff Phil Townson (“Mr. Townson”) initiated this lawsuit against
Defendant Koch Farms, LLC (“Koch”), in the Circuit Court of DeKalb County,
Alabama, on August 5, 2013. (Doc. 1-1 at 5).1 Koch removed the lawsuit to federal
court on September 12, 2013, on the basis of diversity jurisdiction. (Doc. 1 at 1; id.
2 ¶ 2).
Mr. Townson’s complaint contains seven counts stemming from his
commercial chicken dealings with Koch. Count One is for breach of contract. (Doc.
1-1 at 8). Counts Two, Three, and Four allege various fraud theories. (Id. at 8-11).
All page references to Doc. 1-1 correspond with the court’s CM/ECF numbering system.
Count Five asserts tortious interference with a business relationship. (Doc. 1-1 at 11).
Count Six is for civil conspiracy premised upon underlying fraudulent acts. (Id. at
12). Finally, Count Seven is a claim against fictitious parties.2 Id.
Pending before the court is Koch’s Motion for Partial Judgment on the
Pleadings Or, in the Alternative, Partial Summary Judgment (Doc. 11) (the “Partial
Motion”) filed on January 8, 2014. The Partial Motion seeks a dismissal of Counts
Two through Six. (Doc. 11 at 1). Koch filed a brief in support of its Partial Motion
(Doc. 12) on January 8, 2014.3
Mr. Townson opposed the Partial Motion (Doc. 13) on January 28, 2014, and
Koch followed with its reply (Doc. 15) on February 14, 2014. Accordingly, the Partial
Motion is now ready for disposition and, for the reasons explained below, is
GRANTED IN PART and DENIED IN PART.
Rule 12(c) of the Federal Rules of Civil Procedure provides that “[a]fter the
pleadings are closed--but early enough not to delay trial--a party may move for
judgment on the pleadings.” Fed. R. Civ. P. 12(c). As the Eleventh Circuit has
As a general rule, “fictitious-party pleading is not permitted in federal court.” Richardson
v. Johnson, 598 F.3d 734, 738 (11th Cir. 2010).
All page references to Doc. 12 correspond with the court’s CM/ECF numbering system.
explained the Rule 12(c) standard:
Judgment on the pleadings is appropriate when there are no material
facts in dispute, and judgment may be rendered by considering the
substance of the pleadings and any judicially noticed facts. See Bankers
Ins. Co. v. Florida Residential Property and Cas. Joint Underwriting
Ass'n, 137 F.3d 1293, 1295 (11th Cir.1998) (citing Hebert Abstract Co.
v. Touchstone Properties, Ltd., 914 F.2d 74, 76 (5th Cir.1990)); see also
Rule 12(c), Fed. R. Civ. P. When we review a judgment on the
pleadings, therefore, we accept the facts in the complaint as true and we
view them in the light most favorable to the nonmoving party. See
Ortega, 85 F.3d at 1524 (citing Swerdloff v. Miami Nat'l Bank, 584 F.2d
54, 57 (5th Cir.1978)). The complaint may not be dismissed “ ‘unless it
appears beyond doubt that the plaintiff can prove no set of facts in
support of his claim which would entitle him to relief.’ ” Slagle, 102
F.3d at 497 (quoting Conley v. Gibson, 355 U.S. 41, 45–46, 78 S. Ct. 99,
101–02, 2 L. Ed. 2d 80 (1957) & citing Hartford Fire Ins. Co. v.
California, 509 U.S. 764, 811, 113 S. Ct. 2891, 2916–17, 125 L. Ed. 2d
Hawthorne v. Mac Adjustment, Inc., 140 F.3d 1367, 1370 (11th Cir. 1998).
Mr. Townson’s Fraud-Based Claims
Koch maintains that, as presently pled, Mr. Townson’s fraud-based claims are
no different than his breach of contract count because they are not premised upon
“something above and beyond an alleged failure [on the part of Koch] to perform
contractual obligations.” (Doc. 12 at 8). Further, Koch relies upon the comparable
district court case of Stone v. Koch Farms of Gadsden, LLC, No. CV
1:12–3777–RBP, 2013 WL 121477 (N.D. Ala. Jan. 8, 2013), for the proposition that
these fraud claims are appropriately subject to dismissal because, under Alabama law,
“fraud . . . cannot be predicated solely on the fact that a contract was simply breached
during performance.” (Doc. 12 at 9).
In dismissing the plaintiff’s fraud claims as not separately cognizable in Stone,
Judge Propst of this court relied upon “Target Media Partners Operating Co, LLC
v. Specialty Marketing Corp. (Ala. Dec. 21, 2012) and its favorable reference to
Justice Gorman Houston’s concurrence in Hunt Petroleum Corp. v. State of Alabama,
901 So. 2d 1 (Ala. 2004).” Stone, 2013 WL 121477, at *1. In Hunt Petroleum,
Alabama Supreme Court Justice Houston explained:
I recently discussed the difference between breach-of-contract and
fraud claims in my special concurrence in Dickinson v. Land Developers
Construction Co., 882 So. 2d 291 (Ala. 2003): . . . .
Regardless, it is clear that to assert a fraud claim that
stems from the same general facts as one's
breach-of-contract claim, the fraud claim must be based on
representations independent from the promises in the
contract and must independently satisfy the elements of
fraud. Deupree, 522 So. 2d at 245.
Hunt Petroleum, 901 So. 2d at 10, 10-11 (emphasis in original).
Here, the court is persuaded by the foregoing authorities and agrees with Koch
that, as presently formulated, Mr. Townson’s fraud claims overlap with and are not
sufficiently independent from his breach of contract count. Accordingly, because he
has not plausibly presented separately viable fraud claims, Counts Two through Four
of Mr. Townson’s complaint are HEREBY DISMISSED WITH PREJUDICE.
Additionally, because Mr. Townson’s claim of civil conspiracy is premised upon that
same inadequate fraudulent conduct, see, e.g., Goolesby v. Koch Farms, LLC, 955 So.
2d 422, 430 (Ala. 2006) (“A civil conspiracy cannot exist in the absence of an
underlying tort.”), Count Six is similarly HEREBY DISMISSED WITH
Mr. Townson’s Tortious Interference Claim
In Count Five of his complaint, Mr. Townson maintains that Koch interfered
with the financial relationships that he shared with the First Bank of the South and
the United States Department of Agriculture’s Farm Service Agency (“FSA”) because
Koch failed to deliver any flocks to him. (Doc. 1-1 at 7). A claim of tortious
interference requires allegations showing:
(1) the existence of a protectible business relationship; (2) of which the
defendant knew; (3) to which the defendant was a stranger; (4) with
which the defendant intentionally interfered; and (5) damage.
White Sands Group, L.L.C. v. PRS II, LLC, 32 So. 3d 5, 14 (Ala. 2009).
In seeking a dismissal of this count, Koch, first suggests in passing and without
clarifying under which particular authorities, that the claim fails for the same reasons
that Mr. Townson’s fraud ones do. (Doc. 12 at 20). However, none of the cases cited
by Koch in the fraud-focused section of its brief appear to have ever specifically
addressed the viability of an interference claim that overlaps with a breach of contract
count.4 Accordingly, the court rejects this ground offered for dismissal as
Koch then contends that, from a pleading perspective, prima facie elements
three and four are deficient. (Doc. 12 at 20-22). Alternatively, Koch urges that if this
court finds that Mr. Townson has sufficiently stated a claim for interference, then it
should convert the Count Five portion of its Partial Motion to one for summary
judgment and consider the attached declaration of Jim Marsh (“Mr. Marsh”) as
evidence to demonstrate that Koch was not a stranger to those business relationships
that Mr. Townson maintains were harmed by Koch’s actions. (Doc. 12 at 22-23).
Mr. Townson counters that he has plausibly pled his interference claim. (Doc.
13 at 13-15). Regarding the third prima facie element, Mr. Townson asserts:
The Defendants were not parties to these loans. They were aware
of them, but were not on the notes. The Defendants were not an agent of
or related to anyone  involved with the loans and had no financial
stake in the business relationship between the Plaintiff, the First Bank
of the South and the FSA.
In Stone, Judge Propst dismissed a negligence/wantonness count based upon Target’s
fraud-driven analysis. See id. at *3 (“Count Four is also subject to the Target case.”); see also Stone,
No. 1:12-CV-3777-RBP (N.D. Ala. Nov. 1, 2012) (Doc. 1-1 at 12 (pleading
“(NEGLIGENCE/WANTONNESS)” as plaintiff’s fourth count)).
(Doc. 1-1 ¶ 48).
As for the fourth prima facie element, Mr. Townson maintains:
The Defendants intentionally interfered with the business
relationship between the Plaintiff, the First Bank of the South and the
FSA by not sending the Plaintiff anymore flocks. Without flocks to grow
and receive compensation as previously promised, the Plaintiff was
unable to satisfy all of his obligations between the Plaintiff, the First
Bank of South and the FSA.
(Doc. 1-1 ¶ 49).
Mr. Townson also contends that the court should not consider Mr. Marsh’s
declaration. (Doc. 13 at 15). Alternatively, Mr. Townson maintains that, even if the
court does consider the procedurally challenged evidence, “the assignment of rights
by [Mr. Townson] to receive payments from Koch to the First Bank of the South
does not make Koch a party to the contract.” (Doc. 13 at 16).
Having considered both sides’ arguments and studied the cited authorities, the
court concludes that Mr. Townson’s interference claim is adequately pled from a Rule
12 standpoint and that analyzing the cause of action under a Rule 56 framework by
way of a Rule 12(d) conversion is not appropriate at this early stage of the litigation.
Instead and/or regardless, the court determines that the viability of this particular
claim should be decided on a much more developed evidentiary and legal (i.e., with
citations to on-point case authorities) record. Accordingly, that portion of the Partial
Motion is DENIED.
For the reasons stated herein the Partial Motion is GRANTED with respect to
Counts Two, Three, Four, and Six, and is otherwise DENIED. Accordingly, Counts
Two, Three, Four, and Six of Mr. Townson’s complaint are HEREBY DISMISSED
WITH PREJUDICE, and Counts One and Five remain pending.
DONE and ORDERED this 22nd day of April, 2014.
VIRGINIA EMERSON HOPKINS
United States District Judge
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