Lagarde Ltd. et al v. Federal Express Corporation

Filing 7

ORDER AND REASONS granting #3 Motion to Dismiss for Failure to State a Claim. Plaintiff's complaint is dismissed without prejudice, as set forth herein. Signed by Judge Lance M Africk on 08/29/2024. (ko)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
LAGARDE LTD.

CIVIL ACTION

VERSUS

No. 24-1747

FEDERAL EXPRESS CORPORATION

SECTION I

ORDER & REASONS
Before the Court is defendant Federal Express Corporation’s (“defendant”)
motion 1 to dismiss plaintiff Lagarde Ltd.’s, doing business as Chiller Specialties,
(“plaintiff”) complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). Plaintiff
filed a response 2 in opposition, and defendant filed a reply. 3 For the reasons that
follow, the Court grants defendant’s motion to dismiss.
I.

BACKGROUND

This case involves an alleged failure to pay for services rendered. In its
complaint, under a heading labeled “Suit on Open Account,” plaintiff claims that
defendant retained plaintiff “to perform various repair services, including parts and
labor.” 4 Plaintiff states that it “performed air conditioning work at [defendant’s]
facility in a good and workmanlike manner and invoiced following completion of each
item of repair.” 5 Yet, defendant allegedly “failed to pay several invoices sent by

R. Doc. No. 3.
R. Doc. No. 4.
3 R. Doc. No. 5.
4 R. Doc. No. 1-1, ¶ 2.
5 Id. ¶ 3.
1
2

[p]laintiff to [d]efendant.” 6 Plaintiff thereby contends that defendant owes it
$141,601.07, “plus legal interest, court costs[,] and legal fees, for services provided
under the work orders issued to [defendant].” 7 Plaintiff states that it has never been
paid, “[d]espite amicable demand” and that defendant failed for over fifteen days to
pay what it owed after receiving said demand. 8 Plaintiff did not attach a copy of any
written contract, invoices, or work orders to its complaint.
On July 18, 2024, defendant filed the instant motion9 to dismiss for failure to
state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). Defendant argues
that the terms of use governing the parties relationship states that any breach of
their agreement would be governed by Pennsylvania law, not Louisiana law. 10
Because plaintiff’s complaint focuses on a solitary claim of “Suit on Open Account”—
a cause of action recognized in Louisiana as stated in La. R.S. § 9:2781—defendant
argues that plaintiff’s complaint does not contain factual allegations supporting any
cause of action pursuant to Pennsylvania law. 11
In its response, plaintiff states that it was unaware at the time of filing that it
had a written contract with defendant and was thus unaware of the choice-of-law
provision in the agreement. 12 Despite never stating explicitly that it was asserting a

Id.
Id. ¶ 4.
8 Id. ¶ 5–6.
9 R. Doc. No. 3.
10 R. Doc. No. 3-1, at 6.
11 Id. at 7–9.
12 R. Doc. No. 4, at 1.
6
7

2

breach-of-contract claim in the complaint, plaintiff nonetheless argues that all the
elements of a breach-of-contract claim are alleged. 13
In its reply, defendant argues that plaintiff has not alleged the facts necessary
to sustain a breach-of-contract claim pursuant to Pennsylvania law. 14 In particular,
it argues that Pennsylvania law requires a plaintiff to plead, not only the existence
of a contract, but it must also include the essential terms of that contract. 15 Defendant
maintains that, because plaintiff does not include specific facts, “which establish the
relevant time and manner of the work in question, the specific duties owed by the
parties under the contract to effectuate payment, and/or the specific terms of the
contract which [defendant] allegedly breached,” plaintiff’s complaint lacks the
required legal specificity to raise a breach-of-contract claim consistent with
Pennsylvania law. 16
II.
a.

STANDARDS OF LAW

Rule 12(b)(6) Motion to Dismiss

Federal Rule of Civil Procedure 12(b)(6) allows for dismissal of a complaint for
“failure to state a claim upon which relief can be granted.” To survive a motion to
dismiss under Rule 12(b)(6), a plaintiff’s complaint must meet the requirement in
Rule 8(a)(2), requiring “a short and plain statement of the claim showing that the
pleader is entitled to relief.” Ashcroft v. Iqbal, 556 U.S. 662, 677–78 (2009) (quoting

Id. at 3.
R. Doc No. 5, at 2.
15 Id.
16 Id. at 3–4.
13
14

3

Fed. R. Civ. P. 8(a)(2)). While this short and plain statement does not require
“detailed factual allegations,” it “must contain sufficient factual matter, accepted as
true, to state a claim to relief that is plausible on its face.” Id. at 678 (internal
quotations and citations omitted). A claim is facially plausible “when the plaintiff
pleads factual content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Id. “The plausibility standard is not
akin to a probability requirement, but it asks for more than a sheer possibility that a
defendant has acted unlawfully.” Culbertson v. Lykos, 790 F.3d 608, 616 (5th Cir.
2015) (citation and internal quotations omitted).
“[T]he face of the complaint must contain enough factual matter to raise a
reasonable expectation that discovery will reveal evidence of each element of the
[plaintiff’s] claim.” Hi-Tech Elec., Inc v. T&B Constr. & Elec. Servs., Inc., No. 15-3034,
2017 WL 615414, at *2 (E.D. La. Feb. 15, 2017) (Vance, J.) (citing Lormand v. US
Unwired, Inc., 565 F.3d 228, 255–57 (5th Cir. 2009)). A complaint is insufficient if it
contains “only labels and conclusions, or a formulaic recitation of the elements of a
cause of action.” Whitley v. Hanna, 726 F.3d 631, 638 (5th Cir. 2013) (citation and
internal quotations omitted). The complaint “must provide the defendant with fair
notice of what the plaintiff’s claim is and the grounds upon which it rests.” Dura
Pharms., Inc. v. Broudo, 544 U.S. 336, 346 (2005) (citation and internal quotations
omitted).
In considering a motion to dismiss, a court views the complaint “in the light
most favorable to [the] plaintiff, accepting as true all well-pleaded factual allegations

4

and drawing all reasonable inferences in [the] plaintiff’s favor.” Lovick v. Ritemoney
Ltd., 378 F.3d 433, 437 (5th Cir. 2004). A court must limit its review to “the complaint,
any documents attached to the complaint, and any documents attached to the motion
to dismiss that are central to the claim and referenced by the complaint.” Lone Star
Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010) (citing
Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498–99 (5th Cir. 2000)).
b.

Pennsylvania Breach of Contract

Pursuant to Pennsylvania law, “[a] cause of action for breach of contract must
be established by pleading (1) the existence of a contract, including its essential
terms, (2) a breach of a duty imposed by the contract and (3) resultant damages.”
Pennsy Supply, Inc. v. Am. Ash Recycling Corp. of Pa., 895 A.2d 595, 600 (Pa. Super.
Ct. 2006) (quoting Corestates Bank, N.A. v. Cutillo, 723 A.2d 1053, 1058 (Pa. Super.
Ct. 1999). “For a contract to be enforceable, the nature and extent of the mutual
obligations must be certain, and the parties must have agreed on the material and
necessary details of their bargain.” Lackner v. Glosser, 892 A.2d 21, 30 (Pa. Super.
Ct. 2006).
The essential terms of a contract under Pennsylvania law include, but are not
limited to, “time or manner of performance and price to be paid.” Horse Soldier, LLC
v. Tharpe, No. 1:13-CV-2892, 2014 WL 5312823, at *5 (M.D. Pa. Oct. 17, 2014). “While
not every term of a contract must be stated in complete detail, every element must be
specifically pleaded.” Pennsy Supply, 895 A.2d at 600. Furthermore, “[t]o properly
allege a breach of contract, a party needs to point at a specific provision of the

5

[contract] the counterparty breached.” Philidor Rx Servs. LLC v. Polsinelli PC, 552
F. Supp. 3d 506, 513 (E.D. Pa. 2021), aff’d, No. 22-2836, 2023 WL 6290746 (3d Cir.
Sept. 27, 2023).
III.

ANALYSIS

Because plaintiff refers to an agreement retaining it to perform various repair
services for defendant, and because it is central to the complaint, the Court considers
the terms-of-use document alongside the complaint. See Lone Star Fund V, 594 F.3d
at 387. Plaintiff does not dispute that the choice-of-law provision is enforceable. 17 Nor
does it dispute that the Court must dismiss its claim for suit on open account because
La. R.S. § 9:2781, the statute giving rise to this claim, is a Louisiana law. 18 The only
matter that the parties now dispute is whether plaintiff’s complaint nonetheless
alleges sufficient factual matter to constitute a valid claim for breach of contract
pursuant to Pennsylvania law.
Federal courts sitting in diversity cases apply the Federal Rules of Civil
Procedure, not state rules of civil procedure. Klocke v. Watson, 936 F.3d 240, 244 (5th
Cir. 2019) (citing Hanna v. Plumer, 380 U.S. 460, 465 (1965)). Unlike Pennsylvania
procedural rules, the Federal Rules of Civil Procedure do not require plaintiff to

See generally R. Doc. No. 4. When “a forum-selection clause is at issue in a diversity
case,” courts “apply the forum state’s choice-of-law rules to determine what
substantive law governs.” Barnett v. DynCorp Int’l, L.L.C., 831 F.3d 296, 301 (5th Cir.
2016). In Louisiana, contracts “are governed by the law expressly chosen or clearly
relied upon by the parties, except to the extent that law contravenes the public policy
of the state whose law would otherwise be applicable.” La. C.C. Art. 3540. In the
absence of arguments that the choice-of-law provision should not apply, the Court
will honor the parties’ agreement and apply Pennsylvania law.
18 See generally R. Doc. No. 4.
17

6

attach a copy of the relevant contractual documents to its complaint. See 231 Pa. Code
§ 1019(i). However, despite the liberality of federal pleading rules, a plaintiff’s
complaint “still must contain either direct or inferential allegations respecting all the
material elements necessary to sustain a recovery under some viable legal theory.”
In re Plywood Antitrust Litig., 655 F.2d 627, 641 (5th Cir. 1981). Plaintiff must “allege
facts sufficient to place the defendant on notice of the contract claim in such a way
that the defendant can reasonably respond.” See Kingdom Empowerment Intl.
Ministries v. Chubb Custom Ins. Co., No. CV 16-1640, 2016 WL 7423142, at *1 (E.D.
Pa. May 11, 2016) (quoting Transp. Int’l Pool, Inc. v. Ross Stores, Inc., No. CIV. A. 061812, 2009 WL 1033601, at *3 (E.D. Pa. Apr. 15, 2009)).
Pennsylvania breach-of-contract claims are frequently dismissed by federal
courts when the complaint fails to describe the source of the alleged contractual duty
or explain how this duty was violated. 19 For example, in Bissett v. Verizon Wireless

See, e.g., Elliot v. Pa. Interscholastic Athletic Ass’n, Inc., 486 F. Supp. 3d 838, 855
(M.D. Pa. 2020) (dismissing a breach-of-contract claim based on an alleged violation
of bylaws because the provision the plaintiff pointed to only required that an election
be held, and the plaintiff’s allegations “fail[ed] to make clear how the [d]efendants
breached a bylaw term”); Brown v. Am. Airlines, Inc., No. CV 23-2001, 2024 WL
1143478, at *3 (E.D. Pa. Mar. 15, 2024) (dismissing a breach-of-contract claim
alleging that American Airlines breached its Conditions of Carriage because the
complaint “fail[ed] to allege the manner in which the conduct of [American Airlines]’s
employees breached those Conditions or point to a specific provision which [American
Airlines] breached,” thereby failing to “allege facts which would permit [the court] to
draw a reasonable inference that [American Airlines] breached a duty imposed by the
Conditions of Carriage”); Clark Res., Inc. v. Verizon Bus. Network Servs., Inc., No.
1:10-CV-1119, 2010 WL 4973342, at *7 (M.D. Pa. Dec. 1, 2010) (dismissing a breachof-contract claim where the plaintiff attached a written teaming agreement because
it did not state “the services for which [the defendant] would be negotiating, price
terms for those services, or the scope of those services,” and it did not “provide any
19

7

the court dismissed a complaint alleging that a service provider breached a contract
to transfer data from one phone to another by making an unlawful duplication of
private messages and sending them to his personal phone. 401 F. Supp. 3d 487, 500
(M.D. Pa. 2019). The court dismissed the complaint because, while the complaint
alleged that the contract did not allow the data to be duplicated or transferred, it did
not point to the source of this alleged duty—a privacy policy—until its response to
the defendant’s motion to dismiss. Id. at 500–01.
Here, the complaint fails to allege sufficient factual material for the Court to
conclude that defendant contracted with plaintiff to render air-conditioning services.
Nor does the complaint allege sufficient factual matter to conclude that the
$141,601.07 that plaintiff says it is owed20 was the price agreed upon for any services
rendered. Indeed, even the written terms-of-use agreement between the parties does
not alone amount to a contract for services. The terms of use defines “Agreement” as
collectively referring to work orders for services issued by defendant, a vendor’s rate
sheet, and the terms of use. 21 Without the relevant rate sheet, work orders, or a
summary of the essential terms contained in these documents, plaintiff’s allegation
that defendant retained plaintiff to “perform various repair services” is insufficient
to allege a contract to perform air-conditioning services for the price it alleges is owed.

terms outlining what [the p]laintiff was obligated to do to comply,” so the court would
have no way of judging whether the defendant breached the contract).
20 See R. Doc. No. 1-1, ¶ 4.
21 R. Doc. No. 3-3, at 1–2.
8

Furthermore, without alleging the essential terms of the contract, plaintiff
cannot point to a specific provision in the contract that was violated. There is nothing
from which this Court can conclude that there is a duty to pay the $141,601.07
plaintiff says is owed. 22 The Court has no basis to conclude that there is a duty to pay
invoices within fifteen days of a demand for payment, as defendant allegedly failed
to do.23 The complaint is therefore insufficient to state a claim from which relief
can be granted and it must be dismissed.
IV.

CONCLUSION

Accordingly,
IT IS ORDERED that defendant’s motion to dismiss pursuant to Rule 12(b)(6)
is GRANTED, and plaintiff’s complaint is DISMISSED WITHOUT PREJUDICE.
New Orleans, Louisiana, August 29, 2024.

_______________________________________
LANCE M. AFRICK
UNITED STATES DISTRICT JUDGE

22
23

See R. Doc. No. 1-1, ¶ 4.
See id. ¶ 6.
9