Adams Arms, LLC v. Unified Weapon Systems, Inc. et al
Filing
164
ORDER: Adams Arms, LLC's Motion to Dismiss or Strike Unified Weapons Systems, Inc.'s First Amended Counterclaim (Doc. #119 ) is DENIED. Adams Arms' Motion to Dismiss Aguieus, LLC's Counterclaim (Doc. #123 ) is GRANTED IN PART to the extent that Aguieus' Counterclaim for breach of the Letter of Intent is dismissed with leave to amend by February 21, 2017. The Motion is otherwise DENIED. Signed by Judge Virginia M. Hernandez Covington on 2/8/2017. (KAK)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
ADAMS ARMS, LLC,
Plaintiff,
v.
Case No. 8:16-cv-1503-T-33AEP
UNIFIED WEAPON SYSTEMS, INC.
et al.,
Defendants.
______________________________/
ORDER
This cause is before the Court pursuant to Adams Arms,
LLC’s Motion to Dismiss or Strike Unified Weapon Systems,
Inc.’s First Amended Counterclaim (Doc. # 119), which was
filed on October 28, 2016.
On November 18, 2016, Unified
Weapon Systems, Inc. (“UWSI”) filed a Response in Opposition
to the Motion. (Doc. # 128).
Also before the Court is Adams’
Motion to Dismiss Aguieus, LLC’s Counterclaim (Doc. # 123),
which was filed on November 2, 2016. Aguieus filed a Response
to the Motion on November 28, 2016. (Doc. # 131).
As explained below, the Court denies Adams’ Motion to
Dismiss UWSI’s Counterclaims. The Court grants in part Adams’
Motion to Dismiss Aguieus’ Counterclaims to the extent that
Aguieus’ Counterclaim for breach of the Letter of Intent is
dismissed
without
February 21, 2017.
prejudice
and
with
leave
to
amend
by
I.
Facts
A. The Parties
Adams
is
a
Tampa,
Florida,
weapons
manufacturer
specializing in “small arms, including high-powered military
rifles.” (Doc. # 106 at ¶ 1).
UWSI is a Delaware corporation
with its principal place of business in Florida. (Id. at ¶
11).
UWSI is alleged to be a subsidiary of Aguieus. (Doc. #
106 at ¶ 11).
Aguieus is a Delaware limited liability
corporation. (Id. at ¶ 12).
Michael Bingham claims to be the
managing member of Aguieus and the Vice President and Chief
Operating
Officer
of
UWSI.
(Id.
at
¶
13).1
Christian
Quintanilla Aurich, an individual who resides in Peru, is the
President and Chief Executive Officer of UWSI. (Doc. # 106 at
¶ 14).
General James W. Parker, a resident of Hillsborough
County, is a retired Major General from the United States Army
1
On January 20, 2017, UWSI and Aurich filed an elevencount Cross-claim against Aguieus and Bingham, alleging, inter
alia, that Bingham falsely represented that he was the true
owner of UWSI and containing the following counts: Fla. Stat.
§ 495.151 (Count One); common law trade name & trademark
infringement (Count Two); Fla. Stat. § 495.131 (Count Three);
tortious interference (Count Four); Lanham Act (Count Five);
Fla. Stat. § 501.204 (Count Six); common law indemnity (Counts
Seven and Eight); breach of fiduciary duty (Count Nine); fraud
(Count Ten); and the wrongful act doctrine (Count Eleven).
(Doc. # 149).
The filing of the Cross-claim calls into
question the relationship between the Defendants. Aguieus and
Bingham are not currently represented by counsel and have not
yet responded to the Cross-claim.
2
and serves as a Director and advisor for UWSI. (Id. at ¶ 15).
B.
The Letter of Intent and Nondisclosure Agreements
In early 2014, Aguieus approached Adams with a proposal
for the two companies to work together on a bid to supply
high-powered military rifles designed and built by Adams to
the Peruvian military. (Id. at ¶ 18).
According to Bingham,
the Ministry of Defense of the Republic of Peru (the “Peruvian
MOD”) contacted UWSI concerning the opportunity to secure a
multi-year contract for the supply of rifles. (Id. ¶ 19).
“The Peruvian MOD was purportedly funding the purchase through
the Peruvian Factory of Weapons and Ammunition from the Army
S.A.C. (‘FAME’).” (Id.).
The rifles would be constructed
based on the Peruvian MOD’s specifications “with input by UWSI
and its business partners.” (Id. ¶ 20).
“Aguieus
and
UWSI,
through
Mr.
Adams alleges that
Bingham
and
Mr.
Aurich,
solicited [Adams] to be a business partner in the project.”
(Id.). The project would require Adams to provide UWSI with
products, such as demonstration rifles, to disclose trade
secrets and confidential information, and allow a tour of
Adams’ manufacturing facility. (Id. at ¶ 21).
On February 24, 2014, as an “inducement” for Adams to
join the project, Aurich and Bingham, on behalf of Aguieus,
executed
a
“Mutual
Confidentiality
3
and
Nondisclosure
Agreement” with Adams “in which Aguieus agreed not to use
[Adams’]
confidential
information,
including
[Adams’]
technical data, trade secrets, and know-how, for its own use
or for any purpose other than the commercial relationship
between [Adams] and Aguieus.” (Id. at ¶ 22).2
The Mutual
Confidentiality and Nondisclosure Agreement allowed Aguieus to
share Adams’ confidential information with others, such as
UWSI, so long as they “acknowledged and agreed to be bound by
the [Mutual Confidentiality and Nondisclosure Agreement].”
(Id.).
Thereafter, on April 29, 2014, Bingham sent Adams a sixpage Letter of Intent, which UWSI and Adams executed. (Id. at
¶ 23). The Letter of Intent describes the “mutual intentions”
between “Unified Weapon Systems (‘Buyer’) and Adams Arms
(‘Seller’).”
(Doc.
#
117-3
at
1)(emphasis
in
original).
“After signing the [Letter of Intent], on or about June 25,
2014, Mr. Bingham represented to [Adams] that there would be
an immediate order for 3,000 units for use by the Peruvian
MOD.” (Doc. # 106 at ¶ 32).
During
that
time,
General
2
Parker
met
with
Adams’
There
are
at
least
two
Adams
Arms
Mutual
Confidentiality and Nondisclosure Agreements on file dated
February 24, 2014. One is executed by Aurich (Doc. # 106-1 at
4) and the other is executed by Bingham. (Doc. # 106-2 at 4).
Both of these Agreements name “Aguieus” as the “Receiving
Party.” (Id.). General Parker signed a different version of
the agreement on June 24, 2014. (Doc. # 106-4 at 8).
4
President and CEO, Michael Froning, “and represented to Mr.
Froning that General Parker possessed significant expertise
and knowledge regarding foreign and domestic military matters,
which would be helpful to [Adams] in negotiating the rifle
contract with UWS[I].” (Id. at ¶ 33). According to Adams,
General Parker failed to disclose that he was a Director and
advisor for UWSI and “when Mr. Froning asked General Parker
whether he had any conflicts of interest or ties with UWS[I]
that would prevent him from being loyal to [Adams], General
Parker misrepresented to Mr. Froning that he had no ties to
UWS[I].” (Id. at ¶ 34).
In furtherance of General Parker’s efforts to gain access
to Adams’ trade secrets, on June 24, 2014, General Parker
executed a separate confidentiality agreement vowing to hold
Adams’ confidential information and trade secrets “in strict
confidence”
and
agreeing
“not
to
use
any
Confidential
Information for any purpose other than the Business Purpose.”
(Doc.
#
106-4
Consulting
at
Services
3).
General
Agreement
on
Parker
July
also
7,
executed
2014,
a
further
agreeing to keep Adams’ proprietary information confidential
and to only use such information in connection with providing
services on behalf of Adams. (Doc. # 106-5).
C.
Adams Divulges Trade Secrets
Adams “has spent a number of years and endless resources”
5
developing
“numerous
trade
secrets
that
are
crucial
and
extremely valuable to its business.” (Doc. # 106 at ¶¶ 29-30).
Adams explains that it “exerts great efforts to ensure that
its trade secrets remain confidential,” such as requiring
employees and third parties to sign nondisclosure agreements,
maintaining security cameras at its facilities, and requiring
badges for entry into its facilities. (Id. at ¶ 30).
Nonetheless,
and
in
reliance
on
the
Mutual
Confidentiality and Nondisclosure Agreements, General Parker’s
confidentiality agreement, the Letter of Intent, and other
assurances,
Adams
disclosed
its
trade
secrets
Aguieus, Bingham, Aurich, and General Parker.
to
UWSI,
(Id. at ¶ 28).
After the parties formalized their agreements and Adams
disclosed its trade secrets, the rifle project began in
earnest. Between August of 2014, and February of 2015, Adams
manufactured demonstration rifles for examination and testing
by UWSI and the Peruvian MOD.
(Id. at ¶¶ 38-44).
On October
13, 2014, UWSI sent Adams a 2.1 million dollar purchase order
for rifles. (Id. at ¶ 39).
On February 8 and 9, 2015, representatives of
[Adams] attended the demonstration of [Adams’]
rifles
to
the
Peruvian
MOD.
During
the
demonstration, UWSI leveraged [Adams’] brand name
and weapons-making experience, identifying [Adams]
as one of its lead partners, and UWSI used [Adams’]
trademarks to market the rifles to the Peruvian
MOD. To [Adams’] knowledge, UWSI has no ability to
6
design or manufacture any rifles. Instead, it was
marketing [Adams’] rifles to the customer.
(Id. at ¶ 44). According to Adams, the demonstration was a
success, and “all parties approved moving forward with the
joint venture with [Adams] as the manufacturer.” (Id. at ¶
45).
Between April of 2015, and September of 2015, Bingham
requested
supplier
pricing
information
for
the
components of Adams’ rifles, which Adams provided.
46).
Bingham
also
requested
information
separate
(Id. at ¶
about
Adams’
manufacturing facility and equipment, and Adams allowed tours
of its facility in Florida during which Adams revealed stepby-step details of its manufacturing processes, machinery, and
tooling.
(Id. at ¶¶ 46-48).
Following the meetings in Florida, Bingham requested
additional confidential and proprietary information, which he
represented was necessary to secure the contract with FAME.
(Id. at ¶ 50).
This information included photographs of
Adams’ facility, assembly work stations, and tool boxes; a
complete list of parts, parts configurations, parts suppliers,
and prices; a list of all tooling needed for assembly of
Adams’ rifles; a breakdown of the rifle configuration; and
proprietary details of Adams’ technician training program.
(Id.).
7
On September 25, 2015, Bingham represented to Adams that
all submissions to FAME were completed on time “thanks to
[Adams].”
(Id. at ¶ 52).
On November 19, 2015, FAME issued
its bid solicitation for the rifles.
December
10,
response
to
2015,
the
UWSI
bid
submitted
solicitation
procedures, and specifications.
(Id. at ¶ 53).
a
On
qualified
in
using
offer
Adams’
(Id. at ¶ 55).
designs,
On December
18, 2015, FAME announced UWSI as the winning bidder.
(Id. at
¶ 58).
D.
Squeeze-Out of Adams
After UWSI obtained the winning bid, UWSI “began taking
steps
to
squeeze
contract[.]”
[Adams]
(Id. at ¶ 61).
out
of
the
final
purchase
UWSI and Bingham refused Adams’
requests for documents and meetings, although UWSI and Bingham
“continued to seek guidance and input” from Adams about the
design of the rifles.
(Id. at ¶¶ 62-64).
On December 30,
2015, Aurich advised Adams that UWSI would take the entire
project over now that UWSI had all of Adams’ technical and
pricing data.
(Id. at ¶ 65).
In the months that followed,
Adams was excluded from multiple meetings with FAME, including
another meeting in Peru to test Adams’ rifles before final
contract execution.
II.
(Id. at ¶ 66).
Procedural History and Amended Counterclaims
A.
Adams Sets the Stage
8
Adams initiated this action on June 10, 2016, by filing
the Complaint. (Doc. # 1).
At this juncture, the Complaint
has been amended and contains the following counts: breach of
Letter of Intent against UWSI (Count One); breach of Mutual
Confidentiality
and
Nondisclosure
Agreement
against
all
Defendants (Count Two); breach of Confidentiality Agreement
against General Parker (Count Three); breach of the Consulting
Services
Agreement
as
to
General
Parker
(Count
Four);
misappropriation under the Defend Trade Secrets Act as to all
Defendants (Count Five); misappropriation under the Florida
Trade Secrets Act against all Defendants (Count Six); unfair
competition under the Lanham Act against UWSI (Count Seven);
unjust enrichment against UWSI and Aguieus (Count Eight);
specific
performance
of
the
Mutual
Confidentiality
and
Nondisclosure Agreement as to Aguieus and UWSI (Count Nine);
and replevin (Count Ten). (Doc. # 106).
On July 13, 2016, UWSI filed its Motion to Dismiss Counts
One, Two and Five of Adams’ original Complaint (Doc. # 49), as
well as its Answer, Affirmative Defenses, and a tortious
interference Counterclaim against Adams. (Doc. # 52). Aurich
likewise filed a Motion to Dismiss Counts Two and Five of
Adams’ original Complaint (Doc. # 50) along with his Answer
and Affirmative Defenses on July 13, 2016. (Doc. # 51).
Thereafter, on August 2, 2016, Adams filed a Motion to Dismiss
9
UWSI’s tortious interference Counterclaim. (Doc. # 81).
On September 27, 2016, the Court entered a detailed Order
denying
all
of
the
then-pending
Motions.
(Doc.
#
94).
Thereafter, on October 12, 2016, Adams filed a Motion to Amend
the Complaint, which the Court granted. (Doc. ## 104, 105).
Adams’ Amended Complaint was filed on October 13, 2016. (Doc.
# 106).
Motion
One day later, on October 14, 2016, UWSI filed a
to
Amend
its
Counterclaim,
which
the
Court
also
granted. (Doc. ## 107, 108).
B.
UWSI and Aguieus Lodge Counterclaims
UWSI filed its Amended Counterclaim on October 17, 2016.
(Doc. # 109). UWSI’s Amended Counterclaim seeks relief against
Adams for tortious interference (Count One), breach of the
Letter
of
Intent
(Count
Two),
breach
of
the
Mutual
Confidentiality and Nondisclosure Agreement (Count Three), and
unjust enrichment (Count Four).
In support of these claims,
UWSI maintains that Adams’ untimely provision of ultimately
defective
rifles
cost
UWSI
the
Peruvian MOD. (Id. at ¶¶ 13-17).
lucrative
deal
with
the
When Adams did produce
rifles, UWSI alleges that such rifles “did not function
properly.” (Id. at ¶ 17).
According to UWSI, the rifles
“jammed” and a demonstration held on February 12, 2015, “was
an embarrassment and a total failure.” (Id. at ¶ 18). “In the
months following the failed demonstration, UWSI’s frustration
10
grew
because
Adams
failed
to
produce
functioning
Rifles
despite having over a year to do so.” (Id. at ¶ 20).
Despite losing the MOD deal, UWSI claims that it gave
Adams another chance with respect to securing a deal with
FAME. UWSI indicates that it “conducted ammunition testing for
FAME at Adams’ facility” successfully. (Id. at ¶ 24).
UWSI
maintains that, using its own “ingenuity,” it conducted a
successful rifle demonstration with the Peruvian Police in
November of 2015. (Id. at ¶ 25). Thereafter, “FAME selected
UWSI to co-manufacture the Rifles.” (Id. at ¶ 27).
However,
reconfigured
according
with
to
“numerous
UWSI,
the
rifles
modifications”
to
had
to
meet
be
the
exacting bid specifications. (Id. at ¶¶ 28-30). UWSI explains
that, as originally configured, the rifles “failed 70% of the
time.” (Id. at ¶ 28).
“On January 13, 2015, UWSI and Adams
put the Rifles through FAME testing protocol and the Rifles
failed
again.
After
several
testing
failures,
Adams’
representatives abandoned UWSI and the prototype Rifles.” (Id.
at ¶ 29).
UWSI explains that its relationship with Adams
completely deteriorated and UWSI found alternative vendors to
provide the rifle parts, as such, the UWSI “Rifles that are in
FAME’s possession have no Adams parts in them.” (Id. at ¶
33)(emphasis in original).
Adams voiced its concerns to FAME officials in an email
11
dated May 6, 2016, asserting that the rifles subject to the
bid employed technology belonging to Adams and threatening
litigation. (Id. at ¶¶ 36-41). On May 16, 2016, UWSI and FAME
entered
into
a
written
agreement
(the
“FAME
Agreement”)
specifying that FAME and UWSI agreed to manufacture the rifles
in FAME’s facilities in Peru. (Id. at ¶¶ 34-35).
UWSI asserts that the email from Adams to FAME was
written “with the specific and malicious intent of interfering
with UWSI’s agreement and ongoing relationship with FAME and
[to] disrupt the same.” (Id. at ¶ 40). UWSI claims that after
FAME
received
purchase
Adams’
orders
for
email,
the
FAME
rifles.”
“refused
(Id.
at
to
¶
issue
50).
any
UWSI
indicates that Adams knew about the agreement between UWSI and
FAME and issued the threatening email in an effort to harm
that relationship. (Id. at ¶¶ 47-48). UWSI claims that it has
lost millions, if not billions, of dollars due to Adams’
interference. (Id. at ¶ 39).
Adams
misappropriated
In addition, UWSI claims that
confidential
information
including
“UWSI’s product plans, designs, and hardware configuration” to
launch Adams’ Small Frame .308 Rifle (aka the Patrol Rifle).
(Id. at ¶¶ 62, 63).
Likewise,
on
October
27,
2016,
Aguieus
filed
its
Counterclaim against Adams containing allegations akin to
those
presented
in
UWSI’s
Counterclaim
12
and
bringing
the
following
claims
Confidentiality
against
and
Adams:
Nondisclosure
breach
of
Agreement
the
(Count
Mutual
One);
unjust enrichment (Count Two); and breach of the Letter of
Intent (Count Three). (Doc. # 117).
At this point, Adams has filed two Motions that seek
dismissal of the Counterclaims pursuant to Rule 12(b)(1) and
12(b)(6) of the Federal Rules of Civil Procedure. (Doc. ##
119, 123).
Adams also asserts that certain passages in the
Counterclaims are subject to being stricken pursuant to Rule
12(f), Fed. R. Civ. P. (Id.).
Now that UWSI and Aguieus have
responded to the Motions, and the Motions are ripe for the
Court’s review. (Doc. ## 128, 131).
III. Legal Standard
A.
Rule 12(b)(1) Motion to Dismiss
Federal
courts
are
courts
of
limited
jurisdiction.
“[B]ecause a federal court is powerless to act beyond its
statutory grant of subject matter jurisdiction, a court must
zealously insure that jurisdiction exists over a case, and
should
itself
raise
the
question
of
subject
matter
jurisdiction at any point in the litigation where a doubt
about jurisdiction arises.” Smith v. GTE Corp., 236 F.3d 1292,
1299 (11th Cir. 2001).
Motions
to
dismiss
for
lack
of
subject
matter
jurisdiction pursuant to Fed. R. Civ. P. 12(b)(1) may attack
13
jurisdiction facially or factually.
Morrison v. Amway Corp.,
323
Cir.
F.3d
920,
924
n.5
(11th
2003).
When
the
jurisdictional attack is factual, the Court may look outside
the four corners of the complaint to determine if jurisdiction
exists.
Eaton v. Dorchester Dev., Inc., 692 F.2d 727, 732
(11th Cir. 1982).
In a factual attack, the presumption of
truthfulness afforded to a plaintiff under Rule 12(b)(6) does
not attach. Scarfo v. Ginsberg, 175 F.3d 957, 960 (11th Cir.
1999)(citing Lawrence v. Dunbar, 919 F.2d 1525, 1529 (11th
Cir. 1990)). Because the very power of the Court to hear the
case is at issue in a Rule 12(b)(1) motion, the Court is free
to weigh evidence outside the complaint.
Eaton, 692 F.2d at
732.
B.
Rule 12(b)(6) Motion to Dismiss
A motion to dismiss a counterclaim under Rule 12(b)(6) of
the Federal Rules of Civil Procedure is evaluated in the same
manner as a motion to dismiss a complaint.
Stewart Title
Guar. Co. v. Title Dynamics, Inc., No. 2:04-cv-316-FtM-33SPC,
2005
WL
2548419,
at
*1
(M.D.
Fla.
Oct.
11,
2005).
A
counterclaim must contain “a short and plain statement of the
claim showing that the pleader is entitled to relief.”
R. Civ. P. 8(a)(2).
Fed.
In deciding a motion to dismiss pursuant
to Rule 12(b)(6), a court must accept all factual allegations
in the counterclaim as true and construe them in the light
14
most favorable to the counterclaim plaintiff.
See United
Techs. Corp. v. Mazer, 556 F.3d 1260, 1269 (11th Cir. 2009).
“While a [counterclaim] attacked by a Rule 12(b)(6)
motion to dismiss does not need detailed factual allegations,
. . . a plaintiff's obligation to provide 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.”
Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007) (internal citations and quotations marks
omitted).
“Factual allegations must be enough to raise a
right to relief above the speculative level on the assumption
that all the allegations in the complaint are true.”
Id.
(internal citations omitted).
A counterclaim plaintiff must plead enough facts to state
a plausible basis for the claim.
Id.; James River Ins. Co. v.
Ground Down Eng'g, Inc., 540 F.3d 1270, 1274 (11th Cir. 2008)
(“To survive dismissal, the [counterclaim's] allegations must
plausibly suggest that the plaintiff has a right to relief,
raising that possibility above a speculative level; if they do
not, the plaintiff's [counterclaim] should be dismissed.”).
Additionally, “the tenet that a court must accept as true all
of
the
allegations
contained
in
a
[counterclaim]
is
inapplicable to legal conclusions. Threadbare recitals of the
elements of a cause of action, supported by mere conclusory
15
statements, do not suffice.” Ashcroft v. Iqbal, 566 U.S. 662,
678 (2009).
C.
Rule 12(f) Motion to Strike
Pursuant to Rule 12(f), Fed. R. Civ. P., a “court may
strike
from
a
pleading
an
insufficient
defense
or
any
redundant, immaterial, impertinent, or scandalous matter." In
addition, courts are at liberty to strike material that bears
“no possible relation to the controversy, may confuse the
issues, or may cause prejudice to one of the parties.” Ayers
v. Consol. Constr. Servs. of Sw. Fla., Inc., No. 2:07-cv-123,
2007 U.S. Dist. LEXIS 86596, at *2 (M.D. Fla. Nov. 26, 2007).
Although the Court has broad discretion in ruling on a motion
to strike, such motions are disfavored due to their “drastic
nature.”
Royal Ins. Co. of Am. v. M/Y Anastasia, No. 95-cv-
30498, 1997 U.S. Dist. LEXIS 15595, at *10 (N.D. Fla. Jan. 30,
1997).
IV.
Analysis
A.
UWSI’s Tortious Interference Counterclaim
As noted, the Complaint and the Counterclaims have been
amended.
Before the amendments, UWSI’s original Counterclaim
against Adams sought relief for tortious interference based on
Adams’ email to FAME, as well as Adams’ initiation of the
present lawsuit. (Doc. # 52). Adams filed a motion to dismiss
the tortious interference Counterclaim. (Doc. # 81).
16
The
Court carefully analyzed the Counterclaim and determined that
UWSI
adequately
pled
a
claim
for
relief
interference based on the email. (Doc. # 94).
for
tortious
However, the
Court found that the filing of the present lawsuit could not
form a basis for a tortious interference claim based on
Florida’s litigation privilege: “It cannot be disputed that
Adams Arms’ initiation of this suit . . . is not actionable as
tortious interference.” (Id. at 24-25).
Specifically, the
Court determined:
“To prove tortious interference, Plaintiff
must show: (1) the existence of a contract or
business relationship not necessarily evidenced by
an enforceable contract under which [the plaintiff]
has rights; (2) defendants’ knowledge of the
relationship; (3) an intentional and unjustified
interference with the relationship by defendants;
and (4) damage as a result of the interference.”
Mobile Shelter Sys. USA, Inc. v. Grate Pallet
Sols., LLC, 845 F. Supp. 2d 1241, 1258 (M.D. Fla.
2012).
A tortious interference claim will fail absent
“a business relationship evidenced by an actual and
identifiable understanding or agreement which in
all probability would have been completed if the
defendant had not interfered.” Ethan Allen, Inc. v.
Georgetown Manor, Inc., 647 So. 2d 812, 815 (Fla.
1994). Florida law also requires actual harm to a
business relationship, as opposed to merely a
suspicion
or
unsupported
and
speculative
supposition of harm. Realauction.com, LLC v. Grant
St. Grp., Inc., 82 So. 3d 1056, 1058 (Fla. DCA
2011).
Here, the counterclaim sufficiently alleges
each required element.
UWS[I] claims that a
business relationship existed between FAME and
UWS[I] that afforded UWS[I] with existing or
prospective legal rights, that Adams Arms was aware
of that relationship, and that Adams Arms
intentionally interfered with the relationship
17
without justification, causing harm to UWS[I].
Specifically, UWS[I] claims that Adams Arms sent a
defamatory and threatening email to FAME “just as
UWS[I] and FAME were getting ready to ink the deal”
and that the email caused damage to UWS[I]. (Doc. #
90 at 3-4). UWS[I] claims that due to the email
from Adams Arms, FAME refused to issue any purchase
orders, effectively depriving UWS[I] of its
expected monetary benefits under the contract.
At this juncture, these allegations are
sufficient to withstand Adams Arms’ Motion to
Dismiss.
(Doc. # 94 at 22-23).
UWSI has not altered the substance of its tortious
interference Counterclaim since the entry of the Court’s
September
27,
2016,
Order.
Adams
does
not
ask
for
reconsideration of the Court’s prior Order, which upheld the
sufficiency of UWSI’s tortious interference Counterclaim.
Instead, Adams requests that the Court strike UWSI’s reference
to Adams’ filing of this lawsuit as a basis for tortious
interference. Although the Court has ruled that the filing of
the present lawsuit does not constitute an act of tortious
interference by Adams, the Court sees no reason to strike all
reference
to
the
filing
of
the
lawsuit
from
UWSI’s
Counterclaim.
UWSI’s reference to the filing of the lawsuit is not
“redundant, immaterial, impertinent, or scandalous." 12(f),
Fed. R. Civ. P.
In addition, UWSI’s allegations regarding
Adams’ act of initiating the lawsuit by filing the initial
Complaint are not subject to being stricken as confusing,
18
prejudicial, or baseless. The factual allegations regarding
the filing of the lawsuit provide a temporal context for the
complex chain of events in question. Adams’ Motion to Strike
is accordingly denied with respect to UWSI’s Counterclaim for
tortious
interference
and
specifically
with
allegations regarding the filing of the lawsuit.
respect
to
The Court
reiterates its finding that the filing of the present lawsuit
is not an appropriate basis for a tortious interference claim.
The Court is allowing UWSI to include in its Counterclaim some
allegations regarding the filing of the Complaint merely to
provide background information and temporal orientation.
B.
UWSI and Aguieus’ Unjust Enrichment Counterclaims
The elements of an unjust enrichment claim are “(1) the
plaintiff conferred a benefit on the defendant, who had
knowledge
of
accepted
and
the
benefit,
retained
the
(2)
the
defendant
benefit,
and
(3)
voluntarily
under
the
circumstances it would be inequitable for the defendant to
retain the benefit without paying for it.” My Classified Ads,
L.L.C. v. Greg Welteroth Holding, Inc., No. 8:14-cv-2365-T33AEP, 2015 U.S. Dist. LEXIS 31180, at *9 (M.D. Fla. Mar. 13,
2015).
UWSI and Aguieus have alleged each element and satisfy
the burden imposed by Rule 12(b)(6).
Specifically, UWSI and
Aguieus claim that Adams used UWSI and Aguieus’ confidential
19
information to launch a rifle, Adams’ Patrol Rifle, for which
Adams will receive financial gain; that Adams voluntarily
accepted
and
retained
the
benefit
of
the
confidential
information; and that Adams has been enriched at the expense
of UWSI and Aguieus. UWSI and Aguieus also allege that the
circumstances are such that it would be inequitable for Adams
to retain the benefit of the confidential information without
paying for it. See (Doc. # 109 at ¶¶ 67-70; Doc. # 117 at ¶¶
28-31).
Although UWSI and Aguieus have provided a concise
outline of their respective unjust enrichment Counterclaims,
Adams seeks dismissal because these claims lack “requite [sic]
particularity.” (Doc. # 119 at 14; Doc. # 123 at 5).
The Court denies the Motion because the Counterclaims are
more than sufficient to place Adams on notice of the conduct
in question.
In fact, Adams, in presenting its Motions to
Dismiss, was able to succinctly distill the unjust enrichment
Counterclaims as follows: “AA breached the nondisclosure
agreement and was unjustly enriched when it utilized [the]
confidential information for AA’s own commercial gain in
bringing a new product to market (a .308 [Patrol] rifle), a
different product from those discussed in the letter of intent
(a 5.56 and a 7.62 rifle).” (Doc. # 119 at 14; Doc. # 123 at
5). As such, the Court denies the Motions to Dismiss to the
extent they are aimed at the unjust enrichment Counterclaims.
20
C.
UWSI and Aguieus’ Breach of Contract Counterclaims
1.
Standing
Adams seeks an order dismissing Counts Two (breach of
Letter of Intent) and Three (breach of Mutual Confidentiality
and Nondisclosure Agreement) of UWSI’s Counterclaim for lack
of subject matter jurisdiction pursuant to Rule 12(b)(1), Fed.
R. Civ. P. However, rather than claiming that the Court lacks
subject
matter
jurisdiction
over
UWSI’s
relevant
Counterclaims, Adams argues that UWSI does not have standing
to sue Adams for breach of the Letter of Intent and of the
Mutual Confidentiality and Nondisclosure Agreement.
Adams
also contends that Aguieus lacks standing to sue for a breach
of the Letter of Intent because it is not a party to that
contract.
Just as it was necessary to draw upon the Court’s prior
Order to address Adams’ Motion to Dismiss UWSI’s tortious
interference Counterclaim, the Court must once again look back
to the prior Order to assess whether it is appropriate to
dismiss any breach of contract Counterclaims.
Previously,
UWSI sought dismissal of Adams’ breach of contract claim by
arguing that UWSI was not a party to the contract.
however, denied UWSI’s motion to dismiss.
The Court
Based on the
Court’s ruling, UWSI sought leave to amend its Counterclaim to
add a claim for breach of contract.
21
As explained by UWSI:
UWSI amended its Counterclaim to add counts for
breach of the LOI and NDA in the event this Court
ultimately finds that UWSI is a party to those
agreements, as pled and argued by Adams and given
this Court’s rejection of UWSI’s argument to the
contrary in its motion to dismiss. . . . If UWSI is
held to be
a party, then it certainly has the
right to bring its own claims under those
agreements. . . . Adams cannot have it both ways.
It cannot claim that UWSI is a party for purposes
of Adams’ claims against UWSI, but not a party for
purposes of UWSI’s counterclaims against Adams.
(Doc. # 128 at 10-11)(emphasis in original).
Adams’ subject
matter jurisdiction and standing arguments miss the mark to
the extent such arguments are focused on UWSI.
Adams has
taken the position that Adams and UWSI are parties to various
contracts and that UWSI breached those contracts in myriad
ways.
UWSI contends that, if it is a party to the contracts,
it was Adams that breached the contracts, not UWSI. Surely if
the Court has subject matter jurisdiction over Adams’ breach
of contract claims with UWSI as a Defendant, the Court has
subject matter jurisdiction over UWSI’s Counterclaims with
Adams as a Counterclaim Defendant.
The same cannot be said for Aguieus, however, in regards
to the Letter of Intent.3
Adams correctly points out that
3
In contrast, Aguieus does specifically allege that it
is a contracting party to the Mutual Confidentiality and
Nondisclosure Agreement. (Doc. # 117 at ¶ 21). At the Motion
to Dismiss stage, the Court accepts this allegation as true.
Furthermore, Aguieus attaches an executed copy of the Mutual
Confidentiality
and
Nondisclosure
Agreement
to
the
Counterclaim and Aguieus is named as the “Receiving Party” on
the executed Agreement. (Doc. # 117-2 at 4).
22
Aguieus never alleged in its Counterclaim that it is a party
to the Letter of Intent.
And, Adams sued UWSI for breach of
the Letter of Intent, not Aguieus.
The Letter of Intent
states that UWSI is partially owned by Aguieus, but the Letter
of Intent does not reflect that Aguieus is a contracting
party.
Rather, the Letter of Intent is “between Unified
Weapon Systems (‘Buyer’) and Adams Arms (‘Seller’).” (Doc. #
117-3 at 1)(emphasis in original).
Aguieus alleges in Count
Three:
On April 29, 2014, [Adams] executed and delivered a
LOI. Pursuant to the LOI, [Adams] was to deliver
three orders of the Rifles on or before September
1, 2014. [Adams] failed to timely deliver the
Rifles as required by the LOI. [Adams] failed to
deliver a single prototype . . . by September 1,
2014. As a direct result of [Adams’] failure to
timely deliver the Rifles, the opportunity to
secure a contract with the MOD for the MOD Project
was lost. [Adams] materially breached the LOI by
failing to deliver the Rifles before September 1,
2014, and damage has been caused by [Adams’] breach
of the LOI.
(Doc. # 117 at ¶¶ 32-37).
These allegations do not support
Augieus’ claim against Adams for breach of the Letter of
Intent because Aguieus never alleged that it is a party to the
contract or that it is otherwise in privity. “It is hornbook
law that privity of contract ‘is essential to the maintenance
of an action on any contract.’” Katchmore Luhrs, LLC v.
Allianz Global Corp. & Speciality, No. 15-cv-23420, 2017 U.S.
Dist. LEXIS 13778, at *14 (S.D. Fla. Jan. 31, 2017) (citing
23
Sumitomo Corp. of Am. v. M/V Saint Venture, 683 F. Supp. 1361,
1369 (M.D. Fla. 1988)). In addition, “[g]enerally, a contract
does not bind one who is not a party to the contract” and
“[u]nder
Florida
law,
corporations
are
separate
legal
entities, and contracts made by a parent corporation do not
bind a subsidiary.” Whetstone Candy Co., Inc. v. Kraft Foods,
Inc., 351 F.3d 1067, 1072-74 (11th Cir. 2003).
The Court
accordingly grants Adams’ Motion to Dismiss to the extent that
Motion targets Count Three of Aguieus’ Counterclaim, for
breach of the Letter of Intent.
However, the Court grants
Aguieus the opportunity to amend its Counterclaim in light of
the
recent
filing
of
the
Cross-claim,
which
effectively
shuffles the deck regarding corporate identities, ownership,
and alliances in this case.
Any amendment to Aguieus’
Counterclaim must be filed by February 21, 2017.
2.
Rule 12(b)(6) Breach of Contact Analysis
The Court has determined that UWSI has standing to sue
Adams for breach of the Letter of Intent and that both UWSI
and Aguieus have standing to sue Adams for breach of the
Mutual Confidentiality and Nondisclosure Agreement. The Court
now addresses whether UWSI and Aguieus state a claim for
breach of these agreements.
The elements of a breach of contract action are “(1) the
existence of a contract, (2) a breach of the contract, and (3)
24
damages resulting from the breach.” Rollins, Inc. v. Butland,
951
So.
2d
860,
876
(Fla.
2nd
DCA
2006).
In
the
Counterclaims, UWSI and Aguieus allege that the Letter of
Intent
and
the
Mutual
Confidentiality
and
Nondisclosure
Agreement are contracts, that Adams breached the contracts,
and that UWSI and Augieus suffered damages as a result. (Doc.
# 109 at ¶¶ 57-64; Doc. # 117 at ¶¶ 21-26).
Adams’ arguments that the relevant breach of contract
Counterclaims lack specificity are unavailing.
Adams
argues:
“Nothing
indicates
when
For instance,
the
confidential
information was disclosed or whether the information was
conveyed
in
person,
by
phone,
or
through
electronic
transmission. . . . [the] conclusory assertions . . . do not
answer such basic questions as who, what, when, or how.” (Doc.
# 123 at 7). However, none of the Counterclaims allege fraud,
which would require such a greater specificity under Fed. R.
Civ. P. 9(b). The allegations in the questioned Counterclaims
accusing
Adams
confidential
of
wrongfully
information
to
using
create
UWSI
the
and
Patrol
Aguieus’
Rifle
are
sufficient to place Adams on notice regarding the nature of
the claims.
As argued by Aguieus:
Count 1 of Aguieus’s Counterclaim alleges that
[Adams] breached the [Mutual Confidentiality and
Nondisclosure
Agreement]
by
using
Aguieus’
disclosed
Confidential
Information
(a
term
specifically defined in Paragraph 7 of the
Counterclaim and Section 1 of the [Mutual
25
Confidentiality and Nondisclosure Agreement]),
including product plans, designs, and hardware
configuration information, to launch [Adams’] Small
Frame .308 Rifle (aka-Patrol Rifle), and that
Aguieus has been damaged as a result. No further
“particularity” is required for a breach of
contract claim.
(Doc. # 131 at 6).
Adams does not agree with the factual allegations leveled
by UWSI and Aguieus, but that is a matter for a later
determination by a fact-finder, not for disposition on a
Motion to Dismiss or Motion to Strike. The relevant breach of
contract Counterclaims contain more than sufficiently detailed
factual allegations to place Adams on notice regarding the
alleged breaches. The Court accordingly denies Adams’ Motion
to Dismiss UWSI and Aguieus’ Counterclaims for breach of the
Mutual Confidentiality and Nondisclosure Agreement and UWSI’s
Counterclaim for breach of the Letter of Intent.
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
(1)
Adams Arms, LLC’s Motion to Dismiss or Strike Unified
Weapons Systems, Inc.’s First Amended Counterclaim (Doc.
# 119) is DENIED.
(2)
Adams Arms’ Motion to Dismiss Aguieus, LLC’s Counterclaim
(Doc. # 123) is GRANTED IN PART to the extent that
Aguieus’ Counterclaim for breach of the Letter of Intent
is dismissed with leave to amend by February 21, 2017.
26
The Motion is otherwise DENIED.
DONE and ORDERED in Chambers in Tampa, Florida, this 8th
day of February, 2017.
27
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