Astro Tel, Inc. v. Verizon Florida LLC et al

Filing 66

ORDER: Defendants Verizon Florida, LLC and Verizon Communications, Inc.'s Motion to Strike Portions of Plaintiff's Second Amended Complaint and to Dismiss Plaintiff's Second Amended Complaint 57 is DENIED. See Order for details. Signed by Judge Virginia M. Hernandez Covington on 8/27/2012. (KAK)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
ASTROTEL, INC.,
Plaintiff,
v.

Case No. 8:11-cv-2224-T-33TBM

VERIZON FLORIDA, LLC and
VERIZON COMMUNICATIONS, INC.,
Defendants.
______________________________/
ORDER
This matter comes before the Court pursuant to Defendants
Verizon Florida, LLC and Verizon Communications, Inc.’s Motion
to Strike Portions of Plaintiff’s Second Amended Complaint and
to Dismiss Plaintiff’s Second Amended Complaint (Doc. # 57),
filed on June 14, 2012. Plaintiff AstroTel, Inc., filed a
Response to Verizon’s Motion to Dismiss on July 12, 2012.
(Doc. # 60).

Verizon filed a Reply with leave of Court (Doc.

# 63) on July 27, 2012.

For the reasons that follow, the

Court denies the Motion.
I.

Procedural Background
Plaintiff Astrotel filed its Amended Complaint against

Verizon on October 3, 2011, alleging that Verizon engaged in
conduct in violation of antitrust, RICO, and state law. (Doc.
# 9).

Specifically, Astrotel alleged the following counts:

(count 1) monopolization, (count 2) attempted monopolization,
(count 3) monopoly leveraging, (count 4) tying, (count 5)

civil

RICO,

interference

(count
with

6)

Lanham

contract,

Act,

(count

(count
8)

7)

tortious

interference

with

prospective business relations, (count 9) unfair competition,
(count 10) business defamation and disparagement, (count 11)
civil conspiracy, (count 12) unjust enrichment, (count 13)
equitable accounting, and (count 13) injunctive relief.
Subsequently, Verizon filed a Motion to Dismiss (Doc. # 27)
seeking the dismissal of each count.

On May 4, 2012, this

Court entered an Order granting the Motion to Dismiss in part.
(Doc. # 49).

Specifically, the Court dismissed without

prejudice and with leave to amend counts 4-6, 8, and 11-13 and
otherwise denied the Motion to Dismiss.
On May 15, 2012, Astrotel filed its Second Amended
Complaint (the “SAC”) containing the following counts: (count
1) monopolization, (count 2) attempted monopolization, (count
3) monopoly leveraging, (count 4) civil RICO, (count 5)
tortious

interference

with

contract,

(count

6)

unfair

competition, (count 7) business defamation and disparagement,
(count 8) civil conspiracy, and (count 9) injunctive relief.
(Doc. # 52).1

Verizon responded to the SAC by filing its so-

1

Although given the opportunity to do so, Astrotel did
not amend its counts alleging tying, Lanham Act violations,
interference with prospective business relations, unjust
enrichment, and equitable accounting. Astrotel has abandoned
2

called Motion to Strike and Motion to Dismiss on June 14,
2012, seeking the dismissal of each count of the SAC.

In

actuality, except as to the amended RICO count and civil
conspiracy count, the present Motion to Strike and Motion to
Dismiss is a motion for reconsideration.

As explained by

Astrotel,

that

this

Court

previously

found

Astrotel’s

antitrust (counts 1-3 of the SAC), tortious interference with
contract (count 5 of the SAC), unfair competition (count 6 of
the SAC), and business defamation (count 7 of the SAC) counts
satisfied

Rule

12(b)(6).

Accordingly, Verizon’s current

attempt to strike or dismiss is, in essence, a thinly-veiled
motion for reconsideration as to counts 1-3 and 5-7--counts
that this Court has already found to be sufficiently alleged.
Thus, this Court will evaluate Verizon’s motion as to counts
1-3 and 5-7 pursuant to the standards appropriate for a motion
for reconsideration.
As Astrotel amended its civil RICO count and civil
conspiracy count (counts 4 and 8 of the SAC) after the
dismissal of such counts without prejudice, Verizon’s Motion
to Dismiss as to counts 4 and 8 will be addressed pursuant to
Rule 12(b)(6).

these claims.
3

II.

Motion for Reconsideration
A.

Legal Standard

Federal Rules of Civil Procedure 59(e) and 60 govern
motions for reconsideration. Ludwig v. Liberty Mut. Fire Ins.
Co., Case No. 8:03-cv-2378-T-17-MAP, 2005 U.S. Dist. LEXIS
37718, at *6 (M.D. Fla. Mar. 30, 2005).

The time when the

party files the motion determines whether the motion will be
evaluated under Rule 59(e) or Rule 60. Id.

A Rule 59(e)

motion must be filed within 28 days after the entry of the
judgment or order. Motions filed after the 28-day period will
be decided under Federal Rule of Civil Procedure 60(b). Here,
the Court’s Order dismissing certain counts without prejudice
and allowing Astrotel to amend (Doc. # 49) was filed on May 4,
2012, and Verizon’s construed Motion for Reconsideration was
filed on June 14, 2012.

As the Motion was not filed within 28

days of the Court’s Order, the Motion will be addressed
pursuant to Rule 60(b).
It is within the Court's discretion to grant a motion for
reconsideration. Lussier v. Dugger, 904 F.2d 661, 667 (11th
Cir. 1990).

Arguments in favor of granting reconsideration

must be balanced against the desire to achieve finality in
litigation. Id. As stated in Florida College of Osteopathic

4

Medicine, Inc. v. Dean Witter Reynolds, Inc., 12 F. Supp. 2d
1306, 1308 (M.D. Fla. 1998), “A motion for reconsideration
must demonstrate why the court should reconsider its past
decision and set forth facts or law of a strongly convincing
nature to induce the court to reverse its prior decision.”
Further, “in the interests of finality and conservation of
scarce judicial resources, reconsideration is an extraordinary
remedy to be employed sparingly.” Lamar Adver. of Mobile, Inc.
v. City of Lakeland, 189 F.R.D. 480, 489 (M.D. Fla. 1999).
Rule 60(b), Fed.R.Civ.P., is available to relieve a party
from a final judgment or order for the following reasons:
(1)
(2)

(3)
(4)
(5)
(6)

mistake, inadvertence, surprise, or excusable
neglect;
newly
discovered
evidence
that,
with
reasonable diligence, could not have been
discovered in time to move for a new trial
under Rule 59(b);
fraud . . . misrepresentation, or misconduct
by the opposing party;
the judgment is void;
the judgment has been satisfied . . .; or
any other reason that justifies relief.

Rule 60(b), Fed.R.Civ.P.
Whether asserted under either Rule 59 or 60, “a motion
for reconsideration is not the proper forum for the party to
vent dissatisfaction with the Court’s reasoning.” Ludwig, 2005
U.S. Dist. LEXIS 37718, at *11 (internal citation omitted).
B.

Analysis
5

Here,
decided

by

Verizon
the

attempts

Court.

to

relitigate

Verizon

asserts

issues
that

already

Astrotel’s

remaining antitrust counts (counts 1-3 of the SAC) are subject
to

dismissal

as

a

matter

of

law

pursuant

to

Verizon

Communications, Inc. v. Law Offices of Curtis v. Trinko, 540
U.S. 398 (2004); Covad Communications v. Bellsouth Corp., 374
F.3d 1044 (11th Cir. 2004); Covad Communications v. Bell
Atlantic Corp., 398 F.3d 666 (D.C. Cir. 2005); and Cavalier
Telephone, LLC v. Verizon Virginia, Inc., 330 F.3d 176 (4th
Cir. 2003).
Verizon previously asserted the very same arguments,
citing the very same cases, in its initial Motion to Dismiss,
and this Court rejected such arguments.

Nothing has changed

since the entry of the Court’s Order on Verizon’s initial
Motion to Dismiss. There has not been a change in controlling
law,

the

discovery

of

new

evidence,

or

new

factual

developments warranting reconsideration. In addition, Verizon
has not presented arguments regarding mistake, fraud, or any
other

factor

militating

in

favor

Verizon’s re-hashed arguments and

of

reconsideration.

previously tendered cases

do not warrant reconsideration of the Court’s prior Order
finding the antitrust claims sufficient pursuant to Rule
12(b)(6) and Twombly.

Accordingly, the construed Motion for
6

Reconsideration is denied as to counts 1-3 of the SAC.
In addition, as to the state law claims asserted in
counts 5-7 of the SAC, Verizon simply argues that the Court
should decline to exercise supplemental jurisdiction over
these pendant state law claims after the dismissal of the
federal counts.

As the Court has determined that the federal

antitrust claims are sufficient at this juncture, the Court
denies the Motion for Reconsideration as to counts 5-7 of the
SAC.
III. Rule 12(b)(6) Motion to Dismiss
A.

Legal Standard

On a motion to dismiss, this Court accepts as true all the
allegations in the complaint and construes them in the light
most

favorable

to

the

plaintiff.

Jackson

Telecomms., 372 F.3d 1250, 1262 (11th Cir. 2004).

v.

Bellsouth

Further, this

Court favors the plaintiff with all reasonable inferences from
the allegations in the complaint.

Stephens v. Dep’t of Health

& Human Servs., 901 F.2d 1571, 1573 (11th Cir. 1990) (“On a
motion to dismiss, the facts stated in [the] complaint and all
reasonable inferences therefrom are taken as true.”).
However, the Supreme Court explains that:
While a complaint attacked by a Rule 12(b)(6)
motion to dismiss does not need detailed factual
allegations, a plaintiff’s obligation to provide
7

the grounds of his entitlement to relief requires
more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action
will not do. Factual allegations must be enough to
raise a right to relief above the speculative
level.
Bell

Atl.

Corp.

v.

Twombly,

(2007)(internal citations omitted).

550

U.S.

544,

555

Further, courts are not

“bound to accept as true a legal conclusion couched as a
factual allegation.” Papasan v. Allain, 478 U.S. 265, 286
(1986).
B.

Analysis- RICO

The Court previously dismissed Astrotel’s RICO claims
with leave to amend after finding that Astrotel failed to
allege

the

specificity.

predicate

acts

(mail

and

wire

fraud)

with

The Court explained that “AstroTel fails to

plead the necessary ‘who, what, when, where, and how’ of the
alleged fraud as required by Rule 9(b).” (Doc. # 49 at
15)(citing Mizzaro v. Home Depot, Inc., 544 F.3d 1230, 1237
(11th Cir. 2008)).
Although Astrotel has filed amended RICO allegations,
Verizon maintains its argument that the predicate acts are not
described with sufficient particularity. Furthermore, Verizon
asserts that the RICO claim is deficient because Astrotel
failed to allege scienter to support its allegations of mail

8

and wire fraud.

In addition, Verizon asserts that further

amendment of the RICO claim would be futile because Astrotel
cannot demonstrate that Defendants are distinct from the RICO
enterprise.
Astrotel’s amended RICO count spans twenty pages of the
seventy-five page SAC and asserts claims pursuant to 18 U.S.C.
§§ 1962(b),(c), and (d). (Doc. # 52 at 42-62).2

Astrotel

argues that its amended paragraphs 35, 39, 40, 41, 49-54, and
84-111

allege

activity.
In

with

specificity

Verizon’s

racketeering

At this preliminary juncture, this Court agrees.

addition,

while

the

Court

concurs

with

Verizon

that

specific allegations of scienter are required pursuant to
Republic of Panama v. BCCI Holdings (Luxembourg), S.A., 119

2

The RICO provisions at issue state:

(b) It shall be unlawful for any person through a pattern of
racketeering activity or through collection of an unlawful
debt to acquire or maintain, directly or indirectly, any
interest in or control of any enterprise which is engaged in,
or the activities of which affect, interstate or foreign
commerce.
(c) It shall be unlawful for any person employed by or
associated with any enterprise engaged in, or the activities
of which affect, interstate or foreign commerce, to conduct or
participate, directly or indirectly, in the conduct of such
enterprise’s affairs through a pattern of racketeering
activity or collection of unlawful debt.
(d) It shall be unlawful for any person to conspire to violate
any of the provisions of subsection (a), (b) or (c) of this
section.
18 U.S.C. §§ 1962(b)-(d).
9

F.3d 935, 949 (11th Cir. 1997), the Court determines that
Astrotel’s allegations of intent or scienter pass muster at
the Rule 12(b)(6) stage.
Finally,

at

this

preliminary

juncture,

the

Court

declines to dismiss with prejudice the SAC based on Verizon’s
argument that Astrotel cannot demonstrate that Defendants are
distinct from the RICO enterprise.

As explained in Kushner

Promotions, Ltd. v. King, 533 U.S. 158, 161 (2001), “to
establish liability under § 1962(c) one must allege and prove
the existence of two distinct entities: (1) a ‘person;’ and
(2) an ‘enterprise’ that is not simply the same ‘person’
referred to by a different name.”

Verizon correctly argues

that “RICO forbids the imposition of liability where the
enterprise is nothing more than a subdivision or part of the
person.” (Doc. # 57 at 9)(citing United States v. Goldin
Indus., 219 F.3d 1271, 1276 (11th Cir. 2000)).
Astrotel does not present any opposition to Verizon’s
argument that the SAC fails to show distinctness between a
RICO person and a RICO enterprise.

However, the Court notes

that “distinctness is a fact-intensive inquiry that is not
driven solely by formal legal relationships.” Lockheed Martin
Corp. v. Boeing Co., 314 F. Supp. 2d 1198, 1212 (M.D. Fla.

10

2004).

Thus, the Court determines that it is appropriate to

deny the Motion to Dismiss and allow this case to proceed to
the

summary

judgment

stage.

Verizon’s

fact-intensive

arguments are better suited for disposition under Rule 56,
with reference to the materials on file obtained during
discovery.3
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
Defendants
Communications,
Plaintiff’s

Verizon
Inc.’s

Second

Florida,
Motion

Amended

to

LLC
Strike

Complaint

and

and

Verizon

Portions
to

of

Dismiss

Plaintiff’s Second Amended Complaint (Doc. # 57) is DENIED.
DONE and ORDERED in Chambers in Tampa, Florida, this 27th
day of August 2012.

3

Verizon does not advance any independent arguments in
support of the dismissal of Astrotel’s civil conspiracy claim,
except that it should be dismissed as a pendant state law
claim. The Court thus denies the Motion to Dismiss as to that
claim.
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Copies:

All Counsel of Record

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