Ranger Panama Fund, LLC et al v. Keamy et al
Filing
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ORDER granting in part 16 Plaintiffs' Motion to Dismiss Counterclaims. Defendants' Counterclaim 3 is DISMISSED without prejudice. Defendants have up to and including December 21, 2015, to amend this counterclaim. Signed by Judge Sheri Polster Chappell on 12/7/2015. (LMF)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
RANGER PANAMA FUND, LLC,
RANGER FUND, S.A., EL POZO
BONITO, S.A., DAVID NIPPER and
BETTY NIPPER, a Florida limited liability
corporation
Plaintiffs,
v.
Case No: 2:15-cv-413-FtM-38CM
JOHN KEAMY and CHAMOND LIU,
Defendants.
/
ORDER1
This matter comes before the Court on Plaintiffs' Motion to Dismiss Counterclaims
(Doc. #16) filed on September 3, 2015. Defendants filed a Response in Opposition (Doc.
#19) on September 22, 2015. The matter is ripe for review.
Background
This is a breach of contract action. Plaintiffs Ranger Panama Fund, LLC, Ranger
Fund, S.A., and El Pozo Bonito, S.A. are domestic and foreign corporations engaged in
purchasing, selling, and developing real estate in the Republic of Panama. (Doc. #14 at
3). Plaintiffs David Nipper and Betty Nipper are the principals of these corporations. (Doc.
#14 at 3). In March 2007, Defendant Chamond Liu invested $210,000 in a limited liability
1
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corporation called Ranger Fund, LLC (“Series”) that was tasked with creating the Los
Pozos Development in Panama. (Doc. #14 at 3).
At the time of this investment, Liu believed he would receive profits from the
development and eventually the return of his principal investment. (Doc. #14 at 4).
Recently, Liu assigned his rights in the development to Defendant John Keamy for the
purposes of collecting these benefits. Plaintiffs, however, claim Liu had no interest in the
development to assign, and filed this action seeking a declaratory judgment specifying as
much. Defendants responded by filing three counterclaims for breach of contract, unjust
enrichment, and violation of the Florida Securities Investors Protection Act, Fla. Stat. §
517.301(1)(c). Now, Plaintiffs seek to dismiss all three counterclaims.
Legal Standard
In deciding a Rule 12(b)(6) motion to dismiss, the Court limits its consideration
to well-pleaded factual allegations, documents central to, or referenced in, the complaint,
and matters judicially noticed. La Grasta v. First Union Sec., Inc., 358 F.3d 840, 845
(11th Cir. 2004). The Court must accept all factual allegations in a plaintiff's complaint as
true and take them in the light most favorable to the plaintiff. Pielage v. McConnell, 516
F.3d 1282, 1284 (11th Cir. 2008). Conclusory allegations, however, are not entitled to a
presumption of truth. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009); Marsh v. Butler County,
Ala., 268 F.3d 1014, 1036 n. 16 (11th Cir. 2001).
The Court employs the Twombly–Iqbal plausibility standard when reviewing a
complaint subject to a motion to dismiss. Randall v. Scott, 610 F.3d 701, 708, n. 2 (11th
Cir. 2010). A claim is plausible if the plaintiff alleges facts that “allow[ ] the court to draw
the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal,
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556 U.S. at 678. The plausibility standard requires that a plaintiff allege sufficient facts
“to raise a reasonable expectation that discovery will reveal evidence” that supports the
plaintiff's claim. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556 (2007); Marsh, 268
F.3d at 1036 n. 16.
Thus, “the-defendant-unlawfully harmed me accusation” is
insufficient. Iqbal, 556 U.S. at 677. “Nor does a complaint suffice if it tenders naked
assertions devoid of further factual enhancement.” Id. (internal modifications omitted).
Discussion
1. Counterclaim 1 – Breach of Contract
To adequately plead a breach of contract claim under Florida law, a
counterclaimant must allege three elements: (1) a valid contract; (2) a material breach;
and (3) damages. See Friedman v. New York Life Ins. Co., 985 So. 2d 56, 58 (Fla. 4th
DCA 2008). Here, Liu alleges that when he provided his $210,000 investment to Ranger
Fund LLC (“Series”), there was an understanding with Plaintiffs that he “would receive
profits from his investment and ultimately the return of the initial investment.” (Doc. #14
at 4). And Plaintiffs “breached this oral agreement” by refusing to acknowledge Liu’s
rights to the development, thereby causing him damages. (Doc. #14 at 4).
Plaintiffs contend these allegations fail to state a breach of contract claim under
Florida law for two reasons. First, Ranger Fund LLC (“Series”) is not a Plaintiff/CounterDefendant to this action, nor is there any allegation that any of the Plaintiffs are associated
with this entity. (Doc. #16 at 4). So even if Defendants allegations are taken as true,
Defendants fail to allege that they entered into a valid contract with any party involved in
this action.
(Doc. #16 at 4).
Second, Defendants allege only that there was an
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“understanding,” which is insufficient to establish the existence of a contract. (Doc. #16
at 4). The Court disagrees.
In the Complaint, Defendants do not allege that Liu entered into a contract with
only the Ranger Fund LLC (“Series”) entity. Defendants allege that Liu entered into an
oral contract with Plaintiffs. And that contract provided Liu would receive a share of the
profits from the Los Pozos Development and the eventual return of his $210,000
investment. (Doc. #14 at 3-4). Indeed, Ranger Fund LLC (“Series”) is not a party to this
action. But this does not change the fact that Defendants allege it was the oral contract
between Liu and Plaintiffs that led him to invest $210,000 with the Ranger Fund LLC
(“Series”) entity. When these factual allegations are taken as true, the Court finds
Plaintiffs’ first argument must be denied.
Plaintiffs’ second argument fares no better. Relying on Textron Financial Corp. v.
Lentine Marine Inc., 630 F. Supp. 2d 1352, 1356 (S.D. Fla. 2009), Plaintiffs contend
Defendants allegation of an “understanding” is not sufficient to allege “the existence of a
contract.” (Doc. #16 at 4). Yet, without any explanation from Plaintiffs, the Court is
perplexed as to how Textron supports this argument. To begin, Textron dealt with a
motion for partial summary judgment, not a motion to dismiss. These distinct motions
require distinct perspectives from the Court. Moreover, there is no indication that Textron
dealt with an oral agreement or otherwise ruled that alleging an “understanding” is
insufficient to allege the existence of a contract. By titling Count 1 as “Breach of Contract”
and alleging an “oral agreement,” Defendants have satisfied the minimal requirements to
state a claim for breach of an oral contract. See, e.g., Aseguradora Colseguros S.A. v.
Reinhausen Mfg., Inc., No. 6:15-CV-979-ORL-31-DAB, 2015 WL 5735231, at *3 (M.D.
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Fla. Sept. 29, 2015) (finding allegations of an oral contract, material breach of that
contract, and damages were sufficient for a breach of oral contract claim).
2. Counterclaim 2 – Unjust Enrichment
There are three elements to an unjust enrichment claim asserted under Florida
law: “(1) a benefit conferred upon a defendant by the plaintiff, (2) the defendant’s
appreciation of the benefit, and (3) the defendant’s acceptance and retention of the
benefit under circumstances that make it inequitable for him to retain it without paying the
value thereof.” Vega v. T-Mobile USA, Inc., 564 F.3d 1256, 1274 (11th Cir. 2009) (citation
omitted). Here, Defendants allege that Liu conferred a benefit on Plaintiffs in the form of
his $210,000 investment into the Ranger Fund LLC (“Series”) entity, that Plaintiffs
appreciated this benefit, and that allowing Plaintiffs to accept and retain the benefit
without paying back the value thereof would be inequitable. (Doc. #14 at 4). Plaintiffs
aver this claim fails because Florida law does not allow an unjust enrichment claim if an
express contract exists covering the same subject matter. The Court disagrees.
It is well established that a party cannot assert a quasi-contract claim, such as
unjust enrichment, if there is no dispute among the parties that an express contract
governs the subject matter at issue. See Wiand v. Wells Fargo Bank, N.A., 86 F. Supp.
3d 1316, 1332 (M.D. Fla. 2015). But the same does not hold true when there is only an
allegation that an oral contract has been breached. In those circumstances, the party
alleging breach may, in the alternative, assert a claim for unjust enrichment pursuant to
Federal Rule of Civil Procedure 8(d)(2). See Rolyn Const. Corp. v. Coconut Grove PT
Ltd. P'ship, No. 07-20834-CIV-HUCK, 2007 WL 2071268, at *2 (S.D. Fla. July 19, 2007).
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To do so, however, the party must ensure it excludes any allegations that a contract exists
from the unjust enrichment claim. See id.
Turning to this action, while Defendants assert a claim for breach of oral contract,
they separate any allegations relating to this claim from their unjust enrichment claim.
The pertinent allegations asserted for the unjust enrichment claim are only that Liu
conferred a $210,000 benefit; Plaintiffs accepted and appreciated this benefit, promising
to share proceeds and return the benefit principal; and Plaintiffs failed to do so, making it
inequitable for them to retain the benefit. By separating the allegations for their separate
and distinct claims, Defendants successfully asserted an unjust enrichment claim that
survives this Motion.
3. Counterclaim 3 – Violation of Fla. Stat. § 517.301
Florida’s Securities Investors Protection Act makes it unlawful for a person “to
knowingly and willfully falsify, conceal, cover up, by any trick, scheme, or device, a
material fact, make any false, fictitious, or fraudulent statement or representation, or make
or use any false writing or document, knowing the same to contain any false, fictitious, or
fraudulent statement or entry.” Fla. Stat. § 507.301(1)(c). Defendants allege Plaintiffs
violated this Act by “failing to acknowledge Lui’s [sic] investment” and by
“misrepresent[ing] the existence of Lui’s [sic] investment.” (Doc. #14 at 5). Plaintiffs
argue this claim fails for two reasons. First, Defendants allege only that Liu invested only
with Ranger Fund LLC (“Series”), a Nevada entity that is not covered under the Act.
Second, Defendants fail to allege that Plaintiffs engaged in “knowing and willful” conduct,
as required by the Act.
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The Court disagrees with Plaintiffs’ first argument. Defendants base Counterclaim
3 on their alleged oral agreement with Plaintiffs, and that agreement involved Florida
residents who are covered by the Act. But the Court agrees with Plaintiffs’ second
argument.
In alleging this claim, Defendants provide two bare-bones, conclusory
statements: (1) Plaintiffs “misrepresented the existence of Lui’s [sic] investment”; and (2)
“[b]y failing to acknowledge Lui’s [sic] investment, [Plaintiffs] have violated [the Act].”
(Doc. #14 at 5). Beyond the lack of allegations that Defendants engaged in knowing and
willful conduct, as required by the Act, these bare-bones allegations do not withstand the
Iqbal-Twombly pleading standard. Therefore, Counterclaim 3 must be dismissed without
prejudice.2
Accordingly, it is now
ORDERED:
1. Plaintiffs' Motion to Dismiss Counterclaims (Doc. #16) is GRANTED in part.
2. Defendants’ Counterclaim 3 is DISMISSED without prejudice. Defendants
have up to and including December 21, 2015, to amend this counterclaim.
DONE and ORDERED in Fort Myers, Florida, this 7th day of December, 2015.
Copies: All Parties of Record
2
Should Defendants wish to amend Counterclaim 3, they should strive to specify which part of Fla. Stat. §
517.301(1)(c) they believe Plaintiffs violated and remember that if they are relying on allegations of fraud,
those allegations must meet the requirements of Federal Rule of Civil Procedure 9(b).
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