Transformer Disposal Specialists, Inc. v. Trinity Technologies, Inc. et al

Filing 21

MEMORANDUM AND ORDER denying 13 Motion to Dismiss. Signed by District Judge Monti L. Belot on 06/25/2015. (aa)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS

TRANSFORMER DISPOSAL SPECIALISTS,
INC.,

)
)
)
Plaintiff,
)
)
v.
)
)
TRINITY TECHNOLOGIES, INC., et al.,)
)
Defendants.
)
)

CIVIL
No.

ACTION
15-1056-MLB

MEMORANDUM AND ORDER
This case comes before the court on plaintiff’s motion to
dismiss defendant Trinity Technologies’ counterclaim. (Doc. 13). The
motion has been fully briefed and is ripe for decision.
15, 19).

(Docs. 14,

Plaintiff’s motion is denied for the reasons set forth

herein.
I.

Motion to Dismiss Standards: FRCP 12(b)(6)
The standards this court must utilize upon a motion to dismiss

are well known. To withstand a motion to dismiss for failure to state
a claim, a complaint must contain enough allegations of fact to state
a claim to relief that is plausible on its face. Robbins v. Oklahoma,
519 F.3d 1242, 1247 (10th Cir. 2008) (citing Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 127 S. Ct. 1955, 1974 (2007)).

All well-

pleaded facts and the reasonable inferences derived from those facts
are viewed in the light most favorable to plaintiff.

Archuleta v.

Wagner, 523 F.3d 1278, 1283 (10th Cir. 2008). Conclusory allegations,
however, have no bearing upon this court’s consideration.
City of Grove, Okla., 510 F.3d 1196, 1200 (10th Cir. 2007).

Shero v.
In the

end, the issue is not whether plaintiff will ultimately prevail, but
whether he is entitled to offer evidence to support his claims.
Beedle v. Wilson, 422 F.3d 1059, 1063 (10th Cir. 2005).
II.

Analysis
Plaintiff and defendant entered into a licensing agreement under

which defendant was to provide technical information to plaintiff in
exchange for a fee of $1,125,000.

(Doc. 1, exh. 1).

The licensing

agreement provided that defendant would not license the technical
information to any other entity without plaintiff’s permission.
Plaintiff filed a complaint against defendant alleging that defendant
breached the licensing agreement because it provided the technical
information

to

plaintiff’s

competitors.

Defendant

filed

a

counterclaim alleging that plaintiff breached the licensing agreement
by failing to pay for consulting services as required by the licensing
agreement.

(Doc. 12).

The provision pertaining to consulting

services is as follows:
3.4 TRINITY will provide one technician of its choosing
to TDS for up to two
weeks of on-site training and/or
consultation
after
conducting
the
NaX
Process
Demonstration as part of this Agreement and at no charge
to TDS. TRINITY will further provide, at its discretion,
reasonable access to its personnel for up to two months
from the date of Process Demonstration by phone and
facsimile for consultation at no additional charge. After
the two month period, for additional consultation at TDS'
site, TDS will pay TRINITY $2,000 per day to cover
travel, lodging, and other associated expenses for this
support. Personnel, as designated by TRINITY, will be
available to travel to TDS's site during regular business
days for consultation with at least one (1) week's
written notice from TDS. For telephone consultation by
TRINITY on behalf of TDS, and research conducted by
TRINITY on behalf of TDS by TRINITY, TDS will pay $200.00
per hour, with a minimum of ¼ hour billed for each
consultation or support activity. Then, beginning on the
second anniversary of the date of signing this Agreement
and annually thereafter, TRINITY may add a percentage
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equaling up to the Consumer Price Index (CPI), as
determined by US Department of Labor, Bureau of Labor
Statistics for the prior 12 months, plus 2% to the hourly
or daily support rate to cover cost of living increases.
TRINITY will provide a summary of these activities with
all such billings to TDS on a weekly basis as incurred.
(Doc. 1, exh. 1).
Plaintiff moves for dismissal on the basis that defendant’s
counterclaim does not comply with the pleading requirements set forth
in Twombly.

To state a claim for breach of contract, defendant must

allege facts supporting the following elements under Kansas law: (1)
the existence of a contract between the parties; (2) consideration;
(3) defendant’s performance or willingness to perform in compliance
with the contract; (4) plaintiff’s breach of the contract; and (5)
defendant suffered damage caused by the breach.1 Britvic Soft Drinks,
Ltd. v. ACSIS Techs., Inc., 265 F. Supp.2d 1179, 1187 (D. Kan. 2003).
Defendant

alleges

that

plaintiff

has

failed

to

pay

for

consulting and training of operators which allegedly occurred on five
separate dates.

Defendant alleges that the total due for those

services is $11,257.65.

Defendant sent plaintiff a notice to cure

default for failure to pay.

Plaintiff did not cure the default and

defendant terminated the licensing agreement and demanded return of
the technical information.
Plaintiff contends that the allegations are insufficient to
state a claim because the counterclaim does not specify the services
provided by defendant, fails to allege if plaintiff was billed for the
1

Plaintiff’s motion does not contend that defendant has not
established the first two elements.
The court finds that the
allegations in plaintiff’s complaint and the answers set forth in
defendant’s answer and counterclaim establish the first two elements.
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services and fails to state whether the billings complied with the
licensing agreement.

(Doc. 14 at 2-3).

These alleged deficiencies

are not defects of the counterclaim mandating dismissal under Twombly.
The standard set forth in Twombly does not change other principles
governing motions to dismiss, such as that a court must accept all
factual allegations as true and may not dismiss on the ground that it
appears unlikely the allegations can be proven.
1247 (quoting Twombly, 550 U.S. at 555).
middle

ground

between

heightened

fact

Robbins, 519 F.3d at

Twombly merely seeks a
pleading

and

“allowing

complaints that are no more than ‘labels and conclusions' or ‘a
formulaic recitation of the elements of a cause of action,’ which the
Court stated ‘will not do.’”

Id.

Defendant has set forth plausible allegations which state a claim
for breach of contract.

Defendant has alleged that it provided

services under the licensing agreement which were not paid. Defendant
set forth the dates and the amounts billed for the services.

The

facts alleged comply with the standard set forth in Twombly.2
III. Conclusion
Plaintiff’s motion to dismiss defendant’s counterclaim is denied.
(Doc. 13).

2

Twombly has been on the books for 8 years. The most recent
case cited by Trinity is a 1995 5th Circuit case.
If Trinity’s
counsel is going to practice in this court, he is advised to become
knowledgeable of recent, pertinent cases from the Supreme Court and
the Tenth Circuit. Cases outside the Tenth Circuit are of limited
value, particularly when there are many recent Tenth Circuit cases on
the point in question. If counsel cannot do this for some reason, he
should advise his client to seek different counsel who can effectively
litigate in federal court.
-4-

IT IS SO ORDERED.
Dated this

25th

day of June 2015, at Wichita, Kansas.

s/ Monti Belot
Monti L. Belot
UNITED STATES DISTRICT JUDGE

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