NetJets Aviation, Inc. et al v. Peter Sleiman Development Group, LLC et al

Filing 88

ORDER denying 67 Motion to dismiss; denying 80 Motion for sanctions; directing defendants Peter Sleiman Development Group, LLC and Peter Sleiman to file answers to the third amended complaint no later than 10/17/2011; granting 87 motion to modify case schedule; amended scheduling order to issue separately. Signed by Judge Timothy J. Corrigan on 9/27/2011.(SRW)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
JACKSONVILLE DIVISION

NETJETS AVIATION, INC. and
NETJETS SALES, INC.,
Plaintiffs,
vs.

Case No. 3:10-cv-483-J-32MCR

PETER SLEIMAN DEVELOPMENT
GROUP, LLC, PETER SLEIMAN, and
JENNIFER WARD, individually,
Defendants.

ORDER
This case is before the Court on defendants Peter Sleiman Development Group,
LLC’s (“PSDG”) and Peter Sleiman’s Motion to Dismiss Counts One and Five of the Second
Amended Complaint (Doc. 67) and NetJets Aviation, Inc.’s and NetJets Sales, Inc.’s
(together, “NetJets”) response thereto (Doc. 69). At issue is whether NetJets can pierce the
corporate veil to state a breach of contract claim under Florida law against PSDG and
Sleiman for contracts entered into between NetJets and J.Ward, Inc., an entity whose sole
shareholder is defendant Jennifer Ward. Upon referral from the undersigned, the assigned
United States Magistrate Judge issued a Report and Recommendation (Doc. 75), in which
he found that while NetJets sufficiently alleged that PSDG and Sleiman dominated and
controlled J.Ward to such an extent that J.Ward did not have an independent existence,
NetJets failed to sufficiently allege that PSDG’s and Sleiman’s use of J.Ward was fraudulent
or for an improper purpose, as is necessary to state a claim for alter ego liability. The

Magistrate Judge therefore recommended that defendants’ Motion to Dismiss be granted
and that Counts I and V of plaintiffs’ second amended complaint be dismissed without
prejudice. Both sides filed objections (Docs. 77, 79) and responses thereto (Docs. 81, 85),
with NetJets arguing that the Magistrate Judge erred in finding their “improper purpose”
allegations to be deficient and PSDG and Sleiman arguing the Magistrate Judge erred by
concluding that a party other than a shareholder could serve as an alter ego.
Upon independent review of these issues, the undersigned finds it to be a close
question as to whether a non-shareholder can serve as an alter-ego under Florida law.
However, at the pleadings stage, the Court is unprepared to adopt PSDG’s and Sleiman’s
broad reading of Molinas,1 which would foreclose further consideration of whether the “family
unit” exception or any others are applicable here. Additionally, and again because we are
at the pleadings stage, it seems premature to foreclose the possibility that NetJets could
establish that J.Ward was used fraudulently or for an improper purpose, a fact-intensive
inquiry. The undersigned finds the allegations are sufficient for purposes of Rule 8 and only
further discovery will provide the proper record upon which to determine whether NetJets can
ultimately make the required showing necessary to sustain these claims.

1

See Molinas Valle Del Cibao v. Lama, 633 F.3d 1330 (11th Cir. 2011).
2

For these reasons, it is hereby
ORDERED:
Defendants PSDG’s and Sleiman’s Motion to Dismiss (Doc. 67) is denied.2
Defendants’ Motion for Sanctions (Doc. 80) (premised on the frivolity of plaintiffs’ pursuit of
Counts I and V), is likewise denied. PSDG and Sleiman shall file answers to the third
amended complaint no later than October 17, 2011. The parties’ Agreed Motion to Modify
Amended Case Management and Scheduling Order (Doc. 87) is granted. The Court will
enter a separate Second Amended Case Management and Scheduling Order memorializing
the parties’ proposed deadlines and settings.3
DONE AND ORDERED at Jacksonville, Florida this 27th day of September, 2011.

s.
Copies:
Honorable Monte C. Richardson
United States Magistrate Judge
counsel of record
2

The Report and Recommendation (Doc. 75) is therefore adopted in part. Plaintiffs’
objections (Doc. 79) are sustained and defendants’ objections (Doc. 77) are overruled.
3

The parties’ proposed discovery deadlines should leave ample time for the parties to
bring to the Magistrate Judge’s attention any discovery issues that need to be revisited in
light of this Order.
3