KB Industries, Inc et al v. Mr. Appliance, LLC et al

Filing 42

MOTION by Defendants Mark Bruckbauer, Dwyer Franchising LLC, Mr. Appliance, LLC, ProTradeNet, LLC, The Dwyer Group, Inc, The Dwyer Group, LLC for judgment on Counts I and VII of Plaintiffs' Amended Complaint Pursuant to Rule 12(c) (Kingsbury, Colby)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
KB INDUSTRIES, INC., an Illinois
Corporation, KIMBERLY GANDY, an
individual, and ROBERT HOSIER, an
individual
Plaintiffs,

Case No. 3:16-cv-50202

v.
MR. APPLIANCE, LLC, a Texas Limited
Liability Company, DWYER GROUP, INC., a
Delaware Corporation, DWYER
FRANCHISING LLC, a Delaware Limited
Liability Company, THE DWYER GROUP
LLC, a Delaware Limited Liability Company,
THE FINANCE STORE, INC., a Nevada
Corporation, PROTRADENET, LLC, a
Delaware Limited Liability Company, MARK
BRUCKBAUER, an individual, and Grey
Nguyen, an individual, and John Does,
Defendants.

TDG DEFENDANTS’ MOTION FOR JUDGMENT ON COUNTS I AND VII
OF PLAINTIFFS’ AMENDED COMPLAINT PURSUANT TO RULE 12(C)
Now come Defendants, Mr. Appliance LLC (“Mr. Appliance”), The Dwyer Group, Inc.
(“TDG,”improperly named as Dwyer Group, Inc.) (“TDG”), The Dwyer Group LLC (“Dwyer”),
ProTradeNet LLC (“ProTradeNet”), and Mark Bruckbauer (“Bruckbauer”) (collectively the
“TDG Defendants”), by and through their attorneys, Faegre Baker Daniels LLP, and move for
judgment on Counts I and VII of Plaintiffs’ Amended Complaint pursuant to Rule 12(c). In
support of this Motion, the TDG Defendants state as follows:
1.

In 2014, Plaintiff Kimberly Gandy contracted with Mr. Appliance to license a Mr.

Appliance® Franchise.

US.109327114.03

2.

In their Amended Complaint, KB Industries, Inc., Kimberly Gandy, and Robert

Hosier (collectively “Plaintiffs”) allege that The Finance Store and Grey Nguyen (“The Finance
Store Defendants”) fraudulently secured financing for their Mr. Appliance franchise, causing
them to close their franchise and suffer certain economic losses. Because The Finance Store was
a “preferred vendor” of ProTradeNet, a network of vendors owned by TDG, Plaintiffs allege that
the TDG Defendants are also to blame for the closure of their Mr. Appliance Franchise.
3.

Pursuant to the franchise agreement that governs Plaintiffs’ relationship with the

TDG Defendants all state law claims are governed by Texas Law.
4.

In Counts I and VII of the Amended Complaint, Plaintiffs allege that the TDG

Defendants negligently recommended (or endorsed) that they explore the services of The
Finance Store Defendants. Plaintiffs seek economic damages for injuries they allegedly incurred
as a result of the TDG Defendants’ alleged negligence.
5.

Under Texas law (as under Illinois law), the economic loss rule bars parties to a

commercial transaction from recovering for economic losses based on a theory of negligence,
regardless of whether either party can sustain a claim for breach of contract.
6.

Further, though framed as negligent misrepresentation, Count I of Plaintiffs’

Amended Complaint alleges that the TDG Defendants negligently induced Plaintiffs to enter into
a franchise agreement with TDG. Negligent inducement, however, is not a recognized cause of
action under Texas law.
7.

Accordingly, Counts I and VII of Plaintiffs Amended Complaint fail as a matter

of law.
WHEREFORE, the TDG Defendants respectfully ask this Court to grant their
Rule 12(c) Motion for Judgment on Counts I and VII of Plaintiffs’ Amended Complaint, dismiss

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Counts I and VII of Plaintiff’s Amended Complaint with prejudice, and grant such other relief as
the Court deems just and appropriate.

Dated: December 13, 2016

Respectfully submitted,
FAEGRE BAKER DANIELS LLP
/s/ Colby A. Kingsbury
Colby A. Kingsbury (No. 6272842)
Kerry L. Bundy (No. 0266917)
Kate E. Middleton (No. 6306578)
FAEGRE BAKER DANIELS LLP
311 South Wacker Drive, Suite 4300
Chicago, IL 60606
Tel: [phone]
Fax: [phone]
[e-mail]
[e-mail]
[e-mail]
Attorneys for Defendants, Mr. Appliance LLC,
Dwyer Group, Inc., Dwyer Franchising LLC, The
Dwyer Group, LLC, ProTradeNet LLC and Mark
Bruckbauer

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CERTIFICATE OF SERVICE

I, Colby A. Kingsbury, an attorney, hereby certify that on December 13, 2016, I caused a
true copy of TDG Defendants’ Motion to For Judgment on Counts I and VII of Plaintiffs’
Amended Complaint Pursuant to Rule 12(c) to be filed electronically. Notice of this filing
will be sent to the following parties by operation of the Court's electronic filing system:
Sara E. Cook
Kristin Tauras
MCKENNA STORER
1004 Courtaulds Drive, Suite A
Woodstock, Illinois 60098
[e-mail]
[e-mail]
[phone]
Counsel for Plaintiffs

Thomas E. Ladegaard
Les W. Robertson
ROBERTSON & ASSOCIATES, APC
550 West C. Street, Suite 500
San Diego, CA 92101
[e-mail]
[e-mail]
[phone]
Counsel for The Finance Store, Inc.
and Greg Nguyen
Joseph E. Mallon
JOHNSON & KROL, LLC
300 S. Wacker Drive, Suite 1313
Chicago, IL 60606
[e-mail]
[phone]
Counsel for The Finance Store, Inc.
and Greg Nguyen

/s/ Colby A. Kingsbury

US.109327114.03