Mississippi Laundry Services, LLC et al v. Evans et al

Filing 34

Order Denying Without Prejudice Defendant's Rule 12(b)(6) Motion To Dismiss 18 , Denying as Moot Defendant's Motion to Strike Exhibits 28 , and Granting Plaintiffs' Motion for Leave to File Amended Complaint 24 . Signed by District Judge Halil S. Ozerden on January 3, 2017. (BGL)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
MISSISSIPPI LAUNDRY SERVICES, LLC,
and XANITOS, INC.
v.

PLAINTIFFS
Civil No. 1:16cv64-HSO-JCG

BRYCE EVANS
and JOHN DOES 1-15

DEFENDANTS

ORDER DENYING WITHOUT PREJUDICE DEFENDANT’S
RULE 12(b)(6) MOTION TO DISMISS [18], DENYING AS MOOT
DEFENDANT’S MOTION TO STRIKE EXHIBITS [28], AND GRANTING
PLAINTIFFS’ MOTION FOR LEAVE TO FILE AMENDED COMPLAINT [24]
This matter is before the Court on Defendant Bryce Evans’ Motion to Dismiss
[18] and Motion to Strike [28], and Plaintiffs Mississippi Laundry Services, LLC,
and Xanitos, Inc.’s, Motion for Leave to File Amended Complaint [24]. Having
considered the parties’ submissions, the record, and relevant legal authority, the
Court is of the opinion that Defendant’s Motion to Dismiss should be denied without
prejudice to Defendant’s right to re-urge, and Defendant’s Motion to Strike should
be denied as moot. Plaintiffs’ request for leave to amend their Complaint should be
granted and Plaintiffs are granted leave until Friday, January 20, 2017, to file any
Amended Complaint.
I. BACKGROUND
This case arises out of an employment dispute. Defendant Bryce Evans
(“Defendant”) acknowledges that on September 29, 2014, he entered into an
Employment Agreement with Plaintiff Xanitos, Inc. (“Xanitos”), that contained noncompetition and confidentiality clauses. Mot. to Dismiss [18] at 1. Defendant

subsequently left his employment with Xanitos and began working for Gulf Coast
Laundry Services of Mississippi, Inc., a “chief competitor” of Plaintiff Mississippi
Laundry Services, LLC (“Mississippi Laundry”), in December 2015. Compl. [1] at 27.
On February 24, 2016, Plaintiffs Mississippi Laundry Services, LLC
(“Mississippi Laundry”), and Xanitos (collectively, “Plaintiffs”), filed a Complaint [1]
asserting claims against Defendant Bryce Evans (“Evans” or “Defendant”) for:
Count I

Preliminary and Permanent Injunction;

Count II

Conversion of Plaintiffs’ Documents;

Count III

Unfair Competition and Tortious Interference with
Actual and Prospective Advantageous Business
Relations;

Count IV

Misappropriation of Trade Secrets;

Count V

Violation of the Computer Fraud and Abuse Act; and

Count VI

Breach of Contract.

Compl. [1] at 7-11.
On April 1, 2016, Evans filed a Rule 12(b)(6) Motion to Dismiss [18] asserting
that Plaintiffs’ Complaint fails to state a claim. Mot. to Dismiss [18] at 1. Evans
contends that Mississippi Laundry is not a party to his Employment Agreement
with Xanitos and thus lacks standing to raise claims against Evans arising out of
the Employment Agreement. Id. Evans maintains that the Complaint fails to state

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a claim because it relates to Mississippi Laundry’s business and not Xanitos’
business. Id.
Plaintiffs have filed a Response [24] in Opposition to Defendant’s 12(b)(6)
Motion to Dismiss the Complaint, or, in the Alternative, Plaintiffs’ Motion for Leave
to File Amended Complaint. Plaintiffs argue that the Complaint does state a claim
in that Mississippi Laundry “is an intended third party beneficiary of the
Employment Agreement.” Resp. in Opp’n [24] at 2. Alternatively, Plaintiffs seek
leave to amend their Complaint.1 Id. at 3-4.
On June 3, 2016, Evans filed a Motion to Strike [28] requesting that the
Court Strike certain “Exhibits” that were attached to Plaintiff’s Response in
Opposition.
II. DISCUSSION
A.

Relevant Legal Standard
In considering a motion to dismiss under Rule 12(b)(6), the “[C]ourt accepts

‘all well-pleaded facts as true, viewing them in the light most favorable to the

On May 19, 2016, Plaintiffs refiled the “Response in Opposition to Defendant’s
12(b)(6) Motion to Dismiss the Complaint, or, in the Alternative, Plaintiffs’ Motion
for Leave to File Amended Complaint” as a stand-alone “Motion for Leave to
Amend.” Mot. to Amend [26] at 3-4. On May 20, 2016, United States Magistrate
Judge John C. Gargiulo denied the stand-alone Motion [26] without prejudice “for
non-compliance with Local Civil Rule 7(b)(2)” in that the proposed amended
complaint was not attached to the Motion. The Text Order does not alter the fact
that Plaintiffs have requested, as alternate relief, leave to file an amended
complaint pursuant to Federal Rule of Civil Procedure 15(a)(2). See Mot. in Opp’n
[24] at 3-4; Mem. in Supp. [25] at 19.
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plaintiff.’” Martin K. Eby Constr. Co. v. Dallas Area Rapid Transit, 369 F.3d 464,
467 (5th Cir. 2004) (citation omitted). “To survive a motion to dismiss, a complaint
must contain sufficient factual matter, accepted as true, to ‘state a claim to relief
that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Specifically, a plaintiff
must plead “factual content that allows the court to draw the reasonable inference
that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678
(citing Twombly, 550 U.S. at 556).
“[T]he mere presence of additional issues in the record” does not require a
court to treat a motion to dismiss pursuant to Rule 12(b)(6) as one for summary
judgment. Britton v. Seale, 81 F.3d 602, 605 n.1 (5th Cir. 1996) (citation omitted). A
court may consider matters of public record in resolving a motion to dismiss without
converting the motion to one for summary judgment. See Funk v. Stryker Corp., 631
F.3d 777, 783 (5th Cir. 2011) (stating that courts may consider “matters of which a
court may take judicial notice” when reviewing a motion to dismiss pursuant to
Rule 12(b)(6)) (citing Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322,
127 S. Ct. 2499, 168 L. Ed. 2d 179 (2007)). In addition, “[d]ocuments that a
defendant attaches to a motion to dismiss are considered part of the pleadings if
they are referred to in the plaintiff’s complaint and are central to [plaintiff’s] claim.”
Causey v. Sewell Cadillac-Chevrolet, Inc., 394 F.3d 285, 288 (5th Cir. 2004) (citation
omitted).

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B.

Based upon the procedural posture of this case, Evans’ Motion to Dismiss
should be denied without prejudice to his right to re-urge, and his Motion to
Strike should be denied as moot.
Although the Complaint in this case was filed on February 24, 2016,

Defendant filed his Answer and Motion to Dismiss on April 1, 2016. Plaintiffs
requested leave to amend their Complaint on May 19, 2016, less than two months
after Defendant’s Motion was filed. No case management order has yet been
entered.
In determining whether to allow a plaintiff leave to amend a complaint under
Federal Rule of Civil Procedure 15, as opposed to granting a motion to dismiss
under Rule 12, a court considers various factors, although there is a “presumption
in favor of allowing amended pleadings.” Marcucci Sports, LLC v. NCAA, 751 F.3d
368, 378-79 (5th Cir. 2014) (quotation omitted).
“Rule 15(a) requires a trial court to grant leave to amend freely, and the
language of this rule evinces a bias in favor of granting leave to amend.”
Jones v. Robinson Prop. Grp., LP, 427 F.3d 987, 994 (5th Cir. 2005)
(citation and internal quotation marks omitted). Leave to amend is in
no way automatic, but the district court must possess a “substantial
reason” to deny a party’s request for leave to amend. Id. (citation and
internal quotation marks omitted). The district court is entrusted with
the discretion to grant or deny a motion to amend and may consider a
variety of factors including “undue delay, bad faith or dilatory motive on
the part of the movant, repeated failures to cure deficiencies by
amendments previously allowed, undue prejudice to the opposing party
. . . , and futility of the amendment.” Id. (citation omitted). “In light of
the presumption in favor of allowing pleading amendments, courts of
appeals routinely hold that a district court’s failure to provide an
adequate explanation to support its denial of leave to amend justifies

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reversal.” Mayeaux v. La. Health Serv. and Indem. Co., 376 F.3d 420,
426 (5th Cir. 2004) (citation omitted).
Id. at 378.
Given the nature of the arguments presented by the parties, the Court is of
the opinion that the more appropriate course at this juncture would be to permit
Plaintiffs the opportunity to amend their Complaint. There has been no scheduling
order entered, nor has there been any showing of undue delay by the parties in this
case. Granting Plaintiffs’ request to amend would not result in any significant
delay, nor is the request to amend otherwise inconsistent with the appropriate
standards under Rule 15.
Because the Court finds that Defendant’s Motion to Dismiss should be denied
without prejudice, Defendant’s Motion to Strike should be denied as moot.
III.

CONCLUSION

The Court finds that Plaintiffs should be permitted the opportunity to amend
their Complaint to state their claims against Defendant with greater particularity.
Defendant Bryce Evans’ Motion to Dismiss will be denied, without prejudice to his
right to reassert his Motion following the filing of any amended complaint, or to
answer or otherwise respond to Plaintiff’s Complaint or Amended Complaint after
Plaintiffs’ January 20, 2016, deadline.
IT IS, THEREFORE, ORDERED AND ADJUDGED that Defendant Bryce
Evans’ Motion to Dismiss [6] is DENIED WITHOUT PREJUDICE to Defendant’s

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right re-urge, or to answer or otherwise respond to Plaintiffs’ Complaint or
Amended Complaint.
IT IS, FURTHER, ORDERED AND ADJUDGED that Defendant Bryce
Evans’ Motion to Strike [28] is DENIED AS MOOT.
IT IS, FURTHER, ORDERED AND ADJUDGED that Plaintiffs
Mississippi Laundry Services, LLC, and Xanitos, Inc.’s request for leave to file an
Amended Complaint GRANTED, and Plaintiffs shall file any Amended
Complaint on or before Friday, January 20, 2017.
SO ORDERED AND ADJUDGED, this the 3rd day of January, 2017.

s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE

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