Holmberg v. Peel et al
ORDER granting 8 Motion to Dismiss/General(Written Opinion). See Order for details. Signed by Judge Patrick J. Schiltz on August 11, 2017. (CLG)
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Case No. 17‐CV‐1577 (PJS/LIB)
JEFFREY B. PEEL; TARA PEEL;
BENJAMIN B. STERN; BENJAMIN A.
THORUD; TACTACAM, LLC, a/k/a
TACTACAM LIMITED LIABILITY
Mark K. Thompson, MKT LAW PLC, for plaintiff.
Terrance C. Newby, David E. Suchar, and Jevon C. Bindman, MASLON
LLP, for defendants.
This matter comes before the Court on defendants’ motion to dismiss or, in the
alternative, for a more definite statement. Defendants argue that the complaint of
plaintiff Larry Holmberg is deficient in two respects: First, the complaint does not
identify the specific products that defendant Tactacam, LLC, sold and that triggered
defendant Jeffrey B. Peel’s obligation to pay royalties—an obligation that he allegedly
breached. Second, the complaint does not adequately inform the individual defendants
(save Peel) as to the basis on which Holmberg seeks to hold them personally liable. The
Court agrees with the first but not the second of defendants’ arguments.
As to the first argument: To recover royalties from Peel, Holmberg must prove
that Tactacam sold a product that was defined as a “Licensed Product” under § 2.2 of
the Holmberg Patent License Agreement (“Agreement”). ECF No. 1‐1 at 35. To prove
that a product sold by Tactacam was a “Licensed Product,” Holmberg must prove, in
essence, that the product was covered by a patent owned by Holmberg. Id. The Court
agrees that the complaint neither gives fair notice of Holmberg’s royalty‐related claims
nor pleads a plausible basis for those claims because it fails to identify a single product
that Holmberg alleges (1) was sold by Tactacam and (2) was a “Licensed Product”
under the Agreement.
As to the second argument: Holmberg makes only two substantive claims
against the individual defendants (save Peel). First, Holmberg alleges that the
individual defendants have been unjustly enriched, because they have benefitted from
Peel’s breach of the Agreement. Second, Holmberg alleges that the individual
defendants tortiously interfered with the Agreement by inducing and assisting Peel to
breach the Agreement in specified ways.
The “general, if not universal rule” is that corporate officers are personally liable
for any torts that they commit, even if they commit these torts on behalf of the
corporation. Kamensky v. Roemer Indus., Inc., 1 Pa. D. & C. 4th 497, 499 (1988) (quoting
Wicks v. Milzoco Builders, Inc., 470 A.2d 86, 90 (Pa. 1983)). This rule also “applies to
limited liability companies.” Ventres v. Goodspeed Airport, LLC, 881 A.2d 937, 964
(Conn. 2005). So “if a member of a limited liability company injures another person
while working in the course of the firm’s business, the member is personally liable for
that harm . . . , just as the member would be if he worked for a firm organized as a
corporation, a partnership, or any other business form.” Estate of Countryman v. Farmers
Coop. Ass’n, 679 N.W.2d 598, 603‐04 (Iowa 2004). In other words, “[w]hen . . . a member
or manager commits . . . a tort, whether or not he acts on behalf of his LLC, he is liable
to third persons injured thereby.” Mbahaba v. Morgan, 44 A.3d 472, 476 (N.H. 2012)
(citing Sturm v. Harb Dev., LLC, 2 A.3d 859, 866 (Conn. 2010)). The Court finds that the
complaint gives the individual defendants fair notice of Holmberg’s claims against
them and pleads sufficient facts to make those claims plausible.
For these reasons, the Court grants the motion to dismiss. The Court will,
however, give Holmberg leave to file an amended complaint to correct the deficiency
identified above. That amended complaint must identify every “Licensed Product” that
Holmberg contends has been sold by defendants. Moreover, the amended complaint
must, with respect to each such “Licensed Product,” identify the patent or patents that
Holmberg contends cover the product. Obviously, if Holmberg should then learn,
during the course of discovery, of additional “Licensed Products” on which he is owed
royalties, he can move for leave to amend his complaint.
Based on the foregoing, and on all of the files, records, and proceedings herein,
IT IS HEREBY ORDERED THAT:
Defendants’ motion to dismiss [ECF No. 8] is GRANTED.
This matter will be dismissed without prejudice unless Holmberg files an
amended complaint by Friday, September 8, 2017, and in that amended
complaint (a) identifies each “Licensed Product” that Tactacam allegedly
sold and with respect to which Peel allegedly breached his obligation to
pay royalties and (b) with respect to each such “Licensed Product,”
identifies the patent or patents that cover that product.
Dated: August 11, 2017
s/Patrick J. Schiltz
Patrick J. Schiltz
United States District Judge
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