Stolzenburg v. Biewer Lumber, LLC et al

Filing 75

MEMORANDUM AND ORDER:IT IS HEREBY ORDERED that Defendant Green Composites, L.L.C.'s Motion to Dismiss Pursuant to F.R.C.P. 12(B)(6) (ECF No. 52 ) and Defendant Biewer Lumber, LLC's Motion to Dismiss Pursuant to F.R.C.P. 12(B)(2) and 12(B )(6) (ECF No. 54 ) are GRANTED, in part, and DENIED, in part. The Court DISMISSES Plaintiffs claims for implied warranty of merchantability. IT IS FURTHER ORDERED that the Court VACATES its May 23, 2016 Order denying Plaintiffs Motion for Leave to File an Amended Pleading and Joint Additional Parties (ECF No. 57 ). The Court GRANTS Plaintiff leave to file an Amended Complaint. The Clerk of the Court is directed to file Plaintiffs Amended Complaint. IT IS FINALLY ORDERED that the parties shall submit a Joint Scheduling Plan to the Court within fourteen (14) days of the date of this Order. ( Joint Scheduling Plan due by 7/12/2016.) Signed by District Judge Ronnie L. White on 06/28/2016. (KCB)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
MARK A. STOLZENBURG, individually
and on behalf of a class of similarly
situated individuals,
Plaintiff,
v.
BIEWER LUMBER, LLC, et al. ,
Defendant.

)
)
)
)
)
)
)
)
)
)
)

No. 4:14-CV-1533 RLW

MEMORANDUM AND ORDER
This matter is before the Court on Defendant Green Composites, L.L.C.'s Motion to
Dismiss Pursuant to F.R.C.P. 12(B)(6) (ECF No . 52) and Defendant Biewer Lumber, LLC's
Motion to Dismiss Pursuant to F.R.C.P. 12(B)(2) and 12(B)(6) (ECF No. 54).

BACKGROUND
Plaintiff is a resident of Missouri . Plaintiff alleges he purchased the Monarch Decking at
issue in 2005.

The decking was accompanied by a 20 year Monarch Limited Warranty. 1

Defendants argue that Plaintiff became aware of issues and alleged defects in the Monarch
Decking in 2007. Plaintiff filed this Complaint in September 2014. Plaintiff alleges claims under
the Magnuson-Moss Warranty Act (Count I), Breach of Express Warranty and Violations of
Article 2 of the Uniform Commercial Code (Count II), Breach of the Implied Warranty of
Merchantability (Count III), and violations of the Missouri Merchandising Practices Act
("MMP A").

1

Biewer attached the alleged warranty to its Memorandum in Support of its Motion to Dismiss.
Plaintiff claims that Biewer's warranty is not the one provided to him and attaches the allegedly
applicable warranty to his response. See ECF No. 70-1.

LEGAL STANDARD
In ruling on a motion to dismiss or a motion for judgment on the pleadings, the Court
must view the allegations in the complaint liberally in the light most favorable to Plaintiff.
Eckert v. Titan Tire Corp., 514 F .3d 801 , 806 (8th Cir. 2008) (citing Luney v. SGS Auto Servs.,
432 F.3d 866, 867 (8th Cir. 2005)).

Additionally, the Court "must accept the allegations

contained in the complaint as true and draw all reasonable inferences in favor of the nonmoving
party." Coons v. Mineta , 410 F.3d 1036, 1039 (8th Cir. 2005) (citation omitted). To survive a
motion to dismiss, a complaint must contain "enough facts to state a claim to relief that is
plausible on its face. " Bell At!. Corp. v. Twombly, 550 U.S. 544, 570 (2007) (abrogating the "no
set of facts" standard for Fed. R. Civ. P. 12(b)(6) found in Conley v. Gibson, 355 U.S. 41, 45-46
(1957)). While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed
factual allegations, a plaintiffs obligation to provide the grounds of his entitlement to relief
"requires more than labels and conclusions, and a formulaic recitation of the elements of a cause
of action will not do." Twombly, 550 U.S. at 555; Huang v. Gateway Hotel Holdings , 520 F.
Supp. 2d 1137, 1140 (E.D. Mo. 2007).

DISCUSSION

A. Green Tree Composites, L.L.C.
Green Tree Composites, L.L.C. ("Green Tree") raises three arguments in its Motion to
Dismiss (ECF No. 52): (1) Stolzenburg' s complaint should be dismissed because all claims are
barred by the applicable statute of limitations, (2) Count III, alleging breach of an implied
warranty, should be dismissed for failure to state a claim, and (3) the complaint, particularly the

-2-

MMP A claim, should be dismissed for failure to comply with the heightened pleadings standards
in Fed. R. Civ. P. 9(b). 2
1. Statute of Limitations

Green Tree contends that a four-year limitations period applies to Count I (violation of
the Magnuson-Moss Warranty Act ("MMWA"), Count II (breach of express warranty), and
Count III (breach of implied warranty of merchantability). Green Tree states that a five-year
limitations period applies to Count IV for violation of the MMP A. Plaintiff does not dispute the
relevant limitations periods. However, the parties dispute when Plaintiffs alleged causes of
action accrued.
In the Complaint, Plaintiff alleges that he purchased Monarch Decking manufactured by
Defendants to build a deck at his home on or about October 10, 2005. (Complaint, ECF No. 1,
~9) .

Plaintiff further alleges:
Within two years of installation, Stozenburg [sic] noticed that large black spots
began developing on the decking. He notified Defendants of this issue and was
advised by Defendants to treat the same with a Clorox-based solution. When that
did not work, Stolzenburg contacted Defendants again to notify it of the
continuing discoloration. An employee or agent of Defendants suggested
additional sealing and cleaning. Stolzenburg closely followed these instructions,
yet between 2007 and 2013 the decking continued to become discolored, develop
mold, split, crack and warp. Finally, in 2013, the issues had become so
problematic and apparent, that Stolzenburg finally demanded either a refund or
replacement of the product.
In response, Defendants declined to honor
Stolzenburg' s warranty. The only explanation provided to Stolzenburg by
Defendants .. . for their refusal to honor his warranty, was that Green Tree was no
longer in business ... .

(Complaint, ~11 ).

2

Green Tree and Biewer both make these three same arguments and they are addressed together
in this section.
-3-

In response, Plaintiff does not dispute that the four and five year limitations periods apply
to the various counts, but Plaintiff disputes Green Tree' s contention that the causes of actions
accrued and the limitations periods began running in 2007. Rather, Plaintiff contends that the
causes of action accrued and the statute of limitations began running in 2013. Plaintiff contends
that Green Tree warranted future performance of the decking materials, and those warranties
explicitly extended to the future performance of the goods for periods of ten and twenty years.
(ECF No. 70 at 3-4 (citing R. W Murray v. Shatterproof Glass Corp., 697 F.2d 818, 823 (8 1h Cir.
1983) (citing Standard Alliance Industries, Inc. v. Black Clawson Co. , 587 F .2d 813, 820-21
(6th Cir.1978) ("in order to constitute a warranty of future performance under section 400.2725(2), the terms of the warranty must unambiguously indicate that the manufacturer is
warranting the future performance of the goods for a specified period of time"); Ouellette
Machinery Systems, Inc. v. Clinton Lindberg Cadillac Co., 60 S.W. 3d 618, 621 (Mo. Ct. App.

2001 ).("To constitute a warranty for future performance, the terms of the warranty must
unambiguously indicate the manufacturer is warranting the future performance of the goods for a
specified period of time."). Plaintiff contends that Green Tree explicitly extended the warranty
to a warranty for future performance. Plaintiff further argues that the MMP A claim, which
alleges breach of a service warranty, accrues on the date when the defendant first clearly refuses
to honor the warranty. (ECF No. 70 at 5 (citing Schuchmann v. Air Servs. Heating & Air
Conditioning, Inc., 199 S.W.3d 228, 238 (Mo. Ct. App. 2006) ("The harm here occurred .. .

when Defendant flatly refused to honor the lifetime warranty either then or in the future .").
Therefore, Plaintiff asserts that no cause of action under the MMP A began to accrue until Green
Tree refused to honor its warranty in 2013. (ECF No. 70 at 5).

-4-

Further, in response to Green Tree's arguments, Plaintiff contends that the accrual of
causes of action for breach of express warranty, implied warranty and MMW A did not begin to
accrue in 2007 simply because that was the first date that Plaintiff noticed any symptoms. (ECF
No. 70 at 6-7 (citing Linn Reorganized Sch. Dist. No. 2 of Osage Cty. v. Butler Mfg. Co., 672
S.W.2d 340, 342-43 (Mo. 1984) ("What§ 516.100 and§ 516.120 require for the commencement
of the running of the statute is that the resulting damage ' is capable of ascertainment."') ;
Verbrugge v. ABC Seamless Steel Siding, Inc., 157 S.W.3d 298, 302 (Mo. Ct. App. 2005).

Plaintiff argues that "[i]n the absence of unassailable proof that a defendant could be found to
have defaulted on its contractual obligations, damages are not ascertainable." (ECF No. 70 at 7
(citing Ballwin Plaza Corp. v. H B. Deal Const. Co., 462 S.W.2d 687, 690 (Mo. 1971)).
Plaintiff relies on Highway Sales, Inc. v. Blue Bird Corp., 559 F.3d 782 (8th Cir. 2009) where the
Eighth Circuit held that the plaintiffs letter to defendant in 2004 outlining all of the RV' s defects
and demanding a refund of the purchase price did not trigger the statute of limitations. Id. at
788 . The Eighth Circuit held that the "district court erred by concluding as a matter of law that
Oren believed the RV was beyond repair as of that date." Id. at 788. Rather, the Eighth Circuit
held that a "genuine issue of material fact exists regarding the date Oren knew or should have
known Blue Bird was unable to maintain the RV as warranted." Id. at 788. Plaintiff maintains
that there is no contention that Stolzenburg claimed his deck was beyond repair or needed to be
replaced prior to 2013. (ECF No. 70 at 8). Plaintiff states that the only events occurring prior to
2013 were Stolzenburg' s observation of spotting on the decking, notification to Green Tree of
the same, and Stolzenburg' s following Green Tree' s instructions on how to attempt to remedy
the spotting. (ECF No. 70 at 8).

-5-

Green Tree argues that Plaintiffs Complaint alleges that he became aware of problems
with the Monarch Decking within 2 years of purchasing the decking, or in 2007. (ECF No. 53
(citing Complaint, ifl 1).

Green Tree claims that Plaintiffs claims were all "capable of

ascertainment" in 2007 and, therefore, Plaintiffs claims are now time-barred. Green Tree relies
on several Missouri Court of Appeals decisions to support its position: Ashford Condo., Inc. v.
Horner & Shifrin, Inc., 328 S.W.3d 714, 721 (Mo. Ct. App. 2010) (plaintiff knew that the

flashing was improperly installed at the time of construction in 2000 and its claim was timebarred); O'Reilly v. Dock, 929 S.W.2d 297, 302 (Mo. Ct. App. 1996) ("Plaintiffs knew for more
than five years before they filed suit that there was damage being caused by window leaks,
although they did not know the extent of the damage. Thus, while they were not aware of the
precise amount of damage, they were aware of the fact of damage, which means that the damage
they suffered was capable of ascertainment within the meaning of§ 516 .100.1."); Arst v. Max
Barken, Inc., 655 S.W.2d 845, 848 (Mo. Ct. App. 1983) (claim barred by statute of limitations

where the Arsts "discovered cracks and shifting of their foundation in August of 1969 and they
knew who caused such damage, yet they neglected to employ an expert to ascertain the nature of
their damages until August of 1979"); Lato v. Concord Homes, Inc., 659 S.W.2d 593, 594 (Mo.
Ct. App. 1983) (claims for breach of express warranty, negligent design, breach of implied
warranty, and strict liability failed where plaintiffs were aware of a "stopped up lateral sanitary
sewer line which was constructed with an inadequate pitch or degree of fall" more than five
years prior to filing suit); Ball v. Friese Const. Co., 348 S.W.3d 172, 177 (Mo. Ct. App. 2011)
(denying claims for breach of the implied warranty of habitability, fraud and violations of the
Missouri Merchandising Practices Act related to the construction of a house where the

-6-

homeowner "could have discovered the cause of the damages earlier, yet chose not to take the
steps necessary to do so").
Green Tree argues that Plaintiffs claims should be dismissed as time-barred. Plaintiffs
Complaint states that he noticed large black spots on the decking within around 2007. Plaintiff
further alleged that he contacted one of the defendants who advised him to treat the decking with
a Clorox-based solution. "When that did not work, Stolzenburg contacted Defendants again to
notify it of the continuing discoloration.

An employee or agent of Defendants suggested

additional sealing and cleaning. Stolzenburg closely followed these instructions, yet between
2007 and 2013, the decking continued to become discolored, develop mold, split, crack and
warp." (ECF No. 53 at 10-11 (citing Complaint, ifl 1).
The Missouri Supreme Court has interpreted Section 516.1 OO's capable of ascertainment
standard to be an objective standard and has held that "the statute of limitations begins to run

when the 'evidence was such to place a reasonably prudent person on notice of a potentially
actionable injury. ' " Powel v. Chaminade College Preparatory, Inc., 197 S.W.3d 576, 582 (Mo.
bane 2006) (quoting Bus. Men's Assur. Co. of Am. v. Graham, 984 S.W.2d 501 , 507 (Mo. 1999)
(emphasis in original). The test to be applied is "when a reasonable person would have been put
on notice that an injury and substantial damages may have occurred and would have undertaken
to ascertain the extent of the damages." State ex rel. Marianist Province of the United States v.

Ross, 258 S.W.3d 809, 811 (Mo. bane 2008) (citation omitted). Thus, "[i]n order for the statute
[of limitations] to accrue, plaintiff must have knowledge of the wrong and at least nominal
damage, or [knowledge] of something that puts plaintiff on notice to inquire further." Gaydos v.

Imhoff, 245 S.W.3d 303 , 307 (Mo. Ct. App. 2008).

-7-

The Missouri Supreme Court has also explained that the phrase "capable of
ascertainment" refers to "the fact of damage, rather than to the exact amount of damage."
Graham, 984 S.W.2d at 507; Klemme v. Best, 941 S.W.2d 493, 497 (Mo. bane 1997) ("All

possible damages do not have to be known, or even knowable, before the statute accrues.");
Dixon v. Shafton, 649 S.W.2d 435, 438 (Mo. bane 1983) ("The word 'ascertain' has always been

read as referring to the fact of damage, rather than to the precise amount."). Thus, "[d]amages are
ascertained when the fact of damage appears, not when the extent or amount of damage is
determined." Kennedy v. Microsurgery & Brain Research Inst., 18 S.W.3d 39, 42 (Mo. Ct. App.
2000). "When the fact of damage becomes capable of ascertainment, the statute of limitations is
put in motion." Kuehnle, 92 S.W.3d at 139 (emphasis in original) (citation omitted).
The Court holds that an issue of fact exists regarding when Plaintiffs cause of action
began to accrue. Plaintiff alleges in his Complaint that he was aware that something was wrong
with the decking in 2007.

Plaintiff contacted Defendants in 2007 to let them know of his

observations of the decking. Plaintiff alleges that Defendants told Plaintiff to use a treatment
process to treat the issues to the decking. Plaintiff states that he utilized this treatment on the
decking from 2007 through 2013, when he filed this lawsuit. As noted by Plaintiff, Defendants
did not disclaim their warranty in 2007. Although Plaintiff clearly was aware that the decking
had some discoloration, Plaintiff alleges that Defendants' assurances prevented him from
ascertaining his injury.

At this stage of the litigation, the Court cannot determine whether

Plaintiff was aware that he was damaged based upon the assurances provided by Defendants
regarding the decking. The Court holds that an issue of fact exists regarding whether Plaintiff
was prevented from ascertaining the damage to his decking based upon the representations by
Defendants. Linn Reorganized Sch. Dist. No. 2 of Osage Cty. v. Butler Mfg. Co., 672 S.W.2d

-8-

340, 343 (Mo. 1984) (quoting Davis v. Laclede Gas Co. , 603 S.W.2d 554, 556 (Mo. bane 1980)
(Missouri's ' capable of ascertainment' language represents a statutory recognition 'that the
"cause of action" which commences the limitations period should not refer to the "technical"
breach of duty which determines whether the plaintiff has any legal right, but to the existence of
a practical remedy.'). Further, the Court distinguishes the cases relied upon by Defendants to
support their claim that their purported silence does not toll this action. In both Owen v. Gen.
Motors Corp., 533 F.3d 913 (8th Cir. 2008) and Pollard v. Remington Arms Co. , LLC, No. 13-

0086-CV-W-ODS, 2013 WL 3039797 (W.D. Mo. June 17, 2013), the defendants did not make
any affirmative statements to the plaintiffs. In contrast, Defendants in this case affirmatively
gave Plaintiff a course of action that was supposed to remediate the problem with his decking.
Defendants did not respond with mere silence. In turn, Plaintiff alleges that he relied upon these
affirmative statements and did not file suit for several years. The Court holds that Defendants'
assurances could have had the practical effect of prohibiting Plaintiff from making "a practical
determination of the extent of damages" to his decking.

Verbrugge v. ABC Seamless Steel

Siding, Inc. , 157 S.W.3d 298, 303 (Mo. Ct. App. 2005). Therefore, the Court denies Defendants'

Motion to Dismiss based upon statute of limitations grounds.
2. Failure to State a Claim

Defendants contend that the warranty issued to Stolzenburg disclaims all implied
warranties. The Limited Warranty is identified as "The Exotics Decking by Monarch Limited
Warranty." The next sentence states, "There are no warranties which extend beyond the face of
this limited warranty." The third paragraph provides:
Purchaser' s sole remedies for any claim whatsoever, whether in contract,
warranty, tort or strict liability, arising out of the use, installation storage or
possession of Exotics Decking by Monarch products.
Including without
limitation any claim that Exotics Decking by Monarch products failed to perform

-9-

as warranted, shall be for replacement by the Manufacturer with substitute Exotics
Decking by Monarch product.
The next sentence provides, "Manufacturer's sole liability under this warranty is limited solely to
the replacement of defective product." (ECF No. 53 at 18). The seventh paragraph states:
The foregoing warranty is exclusive and in lieu of any and all other warranties
with respect to Exotics Decking by Monarch products, express or implied,
including without limitation, any implied warranty of merchantability or fitness
for a particular purpose which, to the fullest extent allowed by law, are waived
and disclaimed.
The next statement provides that "[i]n order to be eligible for this Limited Warranty, you must
complete and submit the warranty card to Green Tree Composites within 30 days of purchase."
Defendants claim that warranty at issue disclaims all implied warranties. (ECF No. 53 at
19-20). Defendants assert that the Limited Warranty in this case is one-page long and singlesided. (ECF No. 53 at 21). As a result, Defendants maintain that "everything in the Limited
Warranty is conspicuous, and is such that a reasonable person would have or should have read
it." (ECF No. 53 at 21). Defendants argue that the limited warranty does not extend beyond the
guarantees given in the document. Defendants assert that, under both Michigan and Missouri
law, they have disclaimed all warranties. See Mo . Rev. Stat. §400.2-316. Defendants argue that
the Limited Warranty is described as a limited warranty and clearly indicates that there "are no
warranties which extend beyond the face of the limited warranty."

(ECF No. 53 at 22).

Therefore, Defendants argue that it is clear that no warranties are implied beyond the face of the
limited warranty.
In response, Plaintiff contends that even if Green Tree disclaimed all the implied
warranties, Green Tree' s failure to remedy its defective product invalidated the disclaimer under
Missouri law. (ECF No. 70 at 8-9). Plaintiff notes that, unless excluded or modified under
Section 400.2-416, a warranty that the goods shall be merchantable is implied in a contract for

- 10 -

their sale if the seller is a merchant with respect to goods of that kind. Mo. Rev. Stat. 400.2314(1). In order for goods to be merchantable, they must be fit for the ordinary purposes for
which such goods are used. Further, Plaintiff points out that in order to exclude or modify the
implied warranty of merchantability, the language must mention merchantability and be
conspicuous. (ECF No. 70 at 9 (citing Mo. Rev. Stat. 400.2-316). Plaintiff admits that the
warranty issued to Plaintiff mentions the implied "merchantability" warranty but states that
Green Tree refused to honor its express warranty. (ECF No. 70 at 9 (citing Givan v. Mack Truck,
Inc., 569 S.W.2d 243 , 247 (Mo . Ct. App. 1978)). Plaintiff asserts that Green Tree has issued an

express warranty to its customers, included a disclaimer of all implied warranties, refused to
honor the express warranty, and then argued that it was protected by the language contained
within the express warranty. (ECF No. 70 at 9-10). Plaintiff asserts that, even if Green Tree
properly disclaimed the implied warranty of merchantability, then Green Tree remains liable
based upon the express warranty.
The Court holds that the Limited Warranty clearly disclaims all of the implied warranties
other than the express warranty. In fact, Plaintiff admits that the warranty purports to disclaim
the implied warranty of merchantability and argues only that this waiver does not impact the
express warranty. The warranty identifies the implied warranty of merchantability and disclaims
that warranty in clear, unambiguous terms, which complies with the legal requirements for such
a waiver. See ECF No. 70-1. Therefore, the Court dismisses Plaintiffs Claim for breach of the
implied warranty of merchantability.
3. Heightened Pleading Standards

Defendants contend that Plaintiff is subject to a heightened pleading standard relating to
the Plaintiffs fraud allegations, the MMP A claim, or the alter ego allegations. Bi ewer also

- 11 -

argues that Stolzenburg failed to meet a heightened pleading standard related to an alter ego
theory of liability. Defendants argue that Plaintiff has not identified any misrepresentations by
Green Tree to Plaintiff. Defendants also note that Plaintiff has not identified any individuals
from Green Tree who communicated with Plaintiff. (ECF No. 53 at 24-25). With respect to the
alter ego claim, Defendants assert that Plaintiffs Complaint lists legal conclusions as to the alter
ego theory but does not meet the heightened pleading standard. (ECF No. 53 at 24).
Plaintiff contends that he meets the heightened pleading standard for an MMP A claim by
averring specific factual events, including the specific terms of the warranty, the date when he
purchased the decking, a summary of the timeline when he first noticed a defect, the actions he
took when discovering the defect, Green Tree ' s response to the notification of defects, and the
ways in which he contends that Defendants' actions violate the MMPA. (ECF No. 70 at 10-11).
Plaintiff claims that because the MMP A supplements the definition of common law fraud, it
eliminates the need to prove both reliance and an intent to defraud. (ECF No. 70 at 12).
Plaintiff also claims that he has pleaded sufficient facts to satisfy each element of the test
to pierce the corporate veil.

(ECF No. 70 at 12-13) (citing Radaszewski by Radaszewski v.

Telecom Corp., 981 F.2d 305, 306 (8th Cir. 1992) (To pierce the corporate veil, one must show
(1) control, (2) used to commit a fraud or wrong, (3) which caused the injury or wrong
complained of.).

Plaintiff contends that the fraud element of the test can be established by

demonstrating a wrong, violation of a statutory or other positive legal duty, or a dishonest and
unjust act. (ECF No . 70 at 13). Plaintiff alleges the uniform course of conduct between Green
Tree and Biewer, the failure of Green Tree to maintain financial independence, the manner in
which Bi ewer exerted control over Green Tree; the lack of financial independence of the parties;
the fact that the parties shared the same buildings, employees, executives, organization,

- 12 -

contracts, customers, suppliers, advertising, and software; the purpose of operating as the alter
egos of each other; and disgorgement of profits from Green Tree to Biewer. (ECF No. 70 at 13).
The Court holds that, at this stage of the litigation, Plaintiff has satisfied the heightened
pleading standard for stating claims for fraud, under the MMPA, and for alter ego liability in his
Amended Complaint3 . Plaintiff has alleged the who, what, when, and where regarding when the
fraudulent allegedly occurred. Likewise, Plaintiff has alleged sufficient facts to support a finding
of control to support a claim for alter ego or successor liability against Biewer. Therefore, the
Court will deny the motion to dismiss for failure to allege claims under the heightened pleading
standards.

B. Biewer Lumber, LLC

In addition to the two arguments raised previously by Green Tree, Biewer Lumber also
seeks a dismissal based on lack of personal jurisdiction and dismissal for failure to state a claim
based on a contended lack of contractual link between Stolzenburg and Biewer.
1. Personal Jurisdiction

"To survive a motion to dismiss for lack of personal jurisdiction, a plaintiff must make a
pnma facie showing that personal jurisdiction exists, which is accomplished by pleading
sufficient facts 'to support a reasonable inference that the defendant[ ] can be subjected to
jurisdiction within the state.'" K-V Pharm. Co. v. J Uriach & CIA, SA., 648 F.3d 588, 591-92
(8th Cir. 2011) (quoting Dever v. Hentzen Coatings, Inc., 380 F.3d 1070, 1072 (8th Cir. 2004)).
"Although the evidentiary showing required at the prima facie stage is minimal, the showing
must be tested, not by the pleadings alone, but by the affidavits and exhibits supporting or

3

As discussed in the next section, The Court will allow the filing of Plaintiffs Amended
Complaint.
- 13 -

opposing the motion." Id. (internal citations, quotation marks and quoted cases omitted). The
evidence must be viewed in the light most favorable to the plaintiff and all factual conflicts are
resolved in its favor in deciding whether the plaintiff made the requisite showing. Id. (cited case
omitted). The burden of proof does not shift to the party challenging jurisdiction, however.
Fastpath, Inc. v. Arbela Techs. Corp., 760 F.3d 816, 820 (8th Cir. 2014).

"The basis for exercising personal jurisdiction over a non-resident party in Missouri is
Missouri's long-arm statute." Myers v. Casino Queen, Inc., 689 F.3d 904, 910 (8th Cir. 2012).
"Missouri's long-arm statute authorizes personal jurisdiction over defendants who, inter alia,
transact business, make a contract, or commit a tort within the state." Viasystems, Inc. v. EBMPapst St. Georgen GmbH & Co., KG, 646 F.3d 589, 593 (8th Cir. 2011) (citing Mo. Rev. Stat. §

506.500.1 (2000)). "In adopting the long-arm statute, the Missouri legislature 'intended to
provide for jurisdiction, within the specific categories enumerated in the statutes [e.g.,
transacting business or making a contract within the state,] to the full extent permitted by the due
process clause."' K-V Pharm. 648 F.3d at 592 (brackets in original) (quoting State ex rel. Metal
Serv. Ctr. of Ga., Inc. v. Gaertner, 677 S.W.2d 325, 327 (Mo. 1984) (en bane)). In all instances,

the long-arm statute requires that the cause of action arise from the doing of the enumerated act.
Mo. Rev. Stat. § 506.500.3 ("Only causes of action arising from acts enumerated in this section
may be asserted against a defendant in an action in which jurisdiction over him is based upon
this section.").
Biewer contends that Plaintiff did not allege facts sufficient to establish that Biewer is
subject to specific personal jurisdiction or general personal jurisdiction. Biewer claims that it is
not subject to general jurisdiction in Missouri because its contacts with Missouri are not
continuous and systematic so as to render it essentially at home in Missouri. (ECF No. 55 at 8).
- 14 -

Biewer claims that Supreme Court and Eighth Circuit precedent foreclose personal jurisdiction
here. See ECF No. 55 at 8-10 (citing Daimler AG v. Bauman, 134 S. Ct. 746 (2014); Sheely v.
Gear/tronics Indus. Inc., No. 1:15-CV-00048 SNLJ, 2015 WL 4958083 (E.D. Mo. Aug. 19,

2015); Johnson v. Gawker Media, LLC, No. 4:15-CV-1137 CAS, 2016 WL 193390 (E.D. Mo.
Jan. 15, 2016). Biewer notes that it is organized in Michigan and has its principal place of
business in Michigan. Biewer notes that it did not begin operations until 2006. Biewer contends
that the complaint alleges no facts that establish this is "an exceptional case" that would make
Biewer "at home" and subject to general jurisdiction in Missouri.

(ECF No. 55 at 10-11).

Biewer has provided affidavits to establish that it has never manufactured the product at issue in
this case and that Biewer's sales in Missouri of other products and materials are less than one
percent of Biewer's total sales. (ECF No. 55 at 11). As a result, Biewer contends that this Court
cannot have general jurisdiction over it.
Likewise, Biewer claims that this Court lacks specific jurisdiction over it under
Missouri's long arm statute, Mo. Rev. Stat. §506.500. "Specific jurisdiction is proper 'only if the
injury giving rise to the lawsuit occurred within or had some connection to the forum state,
meaning that the defendant purposely directed its activities at the forum state and the claim arose
out of or relates to those activities."' Johnson v. Gawker Media, LLC, No. 4:15-CV-1137 CAS,
2016 WL 193390, at *4 (E.D. Mo. Jan. 15, 2016) (quoting Steinbuch v. Cutler, 518 F.3d 580,
586 (8th Cir. 2008)). In the Complaint, Plaintiff purports to assert specific jurisdiction because
the claims "arose in this District." (Complaint, iJ8).

Contrary to this boilerplate language,

Biewer claims that Plaintiff has alleged no facts to form a basis for exercising specific
jurisdiction.

- 15 -

Further, Defendants maintain that Plaintiff has not alleged any facts to support his claim
of alter ego or successor liability. Defendants note that this case has been going on since 2014
and that the Court gave the parties wide latitude in conducting jurisdictional discovery. (ECF
No. 74 at 10). Nevertheless, Plaintiff has filed no affidavits, depositions or other extrinsic
evidence to support his argument that Biewer, a foreign corporation, should be subject to this
Court's jurisdiction. Defendants assert that, based upon Eight Circuit precedent, Plaintiff cannot
rely on his mere pleadings at this stage of the case and discovery. See ECF No. 74 at 10 (citing
Radaszewski, 981 F.2d at 310 ("While the facts adduced in a Rule 12(b)(2) Motion to Dismiss

for lack of personal jurisdiction must be viewed in the light most favorable to the party opposing
the motion, there must nonetheless be some evidence upon which a prima facie showing of
jurisdiction may be found to exist, thereby casting the burden upon the moving party to
demonstrate a lack of personal jurisdiction."). Thus, the Court must apply "the same standard as
the one [the Court applies] on motions for summary judgment under Rule 56." Radaszewski,
981 F.2d at 310. Thus, Defendants argue that Plaintiff has not alleged any facts to support a
finding of alter ego liability or successor liability. (ECF No. 74 at 10-11). 4
In response, Plaintiff asserts that it has jurisdiction over Biewer based upon the acts of its
alter-ego Green Tree. (ECF No. 70 at 14). Defendants acknowledge that Green Tree is out of
business.

(ECF No. 74 at 7).

Plaintiff has alleged the following facts with respect to the

relationship between Green Tree and Biewer:
•

"At all times pertinent to this action Green Tree and Biewer were and are the alter egos of
each other and in essence constitute one legal entity in which Green Tree operates as a
division of Biewer. The separate incorporation of Green Tree is a sham in that it is

4

Defendants also note that Michigan law requires "a promise to pay the debts or obligations of
another person is void under the statute of frauds unless it is in writing[.]" City of Ecorse v.
Salisbury, No. 299155, 2011 WL 5866984, at *3 (Mich. Ct. App. Nov. 22, 2011).

- 16 -

•

•

merely a corporate veil which insulates Biewer from liability for its products, namely
Monarch Decking, sold and manufactured by Green Tree. Biewer exerted, and currently
exists, extreme influence, complete dominion and/or absolute control over corporate
activity and function of Green Tree. Biewer' s continued operation of Green Tree as a
separate entity is a subterfuge designed to defeat public convenience and understanding,
justify a wrong, perpetrate a fraud and/or otherwise work an injustice on Plaintiff, Class
Members, and the general public. The conduct of Biewer and/or Green Tree has harmed
or will harm Plaintiff, Class Members and the general public, justifying piercing of the
corporate veil and holding Biewer liable for the acts and omissions of Green Tree as they
are in reality one entity." (Complaint, ifl9).
"Biewer and Green Tree are so intertwined contractually for the liabilities, past, present
and future, of each other that they are one entity. Therefore, the corporate veils of each
company should be pierced to properly ascertain the responsible parties for the
allegations contained herein." (Complaint, if20).
"Biewer and/or Green Tree expressly and impliedly agreed to assume certain debts and
responsibilities, including the product liability of Green Tree by virtue of handling of
warranty claims of Green Tree and [sic] well as their continuing relationship."
(Complaint, if2 l ).

However, upon this Court's review of Plaintiffs proposed Amended Complaint (ECF
No . 57-1), the Court notes that Plaintiff included several facts to support his alter ego and
successor liability claims. In particular, Plaintiff alleged that Defendants frequently used the
names Green Tree and Biewer interchangeably. (ECF No. 57-1 at ifif40, 41). Similarly, Green
Tree was underfunded and unable to satisfy the warranty claims for the Monarch Products sold.
(ECF No. 57-1 at if42). Both Green Tree and Biewer were controlled by Brian and Tim Biewer.
(ECF No. 57-1 , if45). Finally, Plaintiff alleges that Biewer expressly and impliedly agreed to
assume the product liability of Green Tree by virtue of handling the warranty claims of Green
Tree, as well as continuing Green Tree's relationship, representations to customers, and retention
of Green Tree' s sales proceeds. (ECF No. 57-1, if47). The Court holds that these factual
allegations must be considered by the Court and, therefore, vacates its prior order denying
Plaintiffs Motion for Leave to File an Amended Complaint.

- 17 -

Based upon the factual allegations included in the Amended Complaint, Plaintiff alleges
claims for alter ego and/or successor liability against Biewer. See Radaszewski, 981 F.2d at 306
("someone injured by the conduct of a corporation or one of its employees can look only to the
assets of the employee or of the employer corporation for recovery"). The Court can obtain
personal jurisdiction of the other party based upon the in-state actions of the alter-ego if the
Court pierces the corporate veil of that party. Radaszewski, 981 F.2d at 306-07 (citing Collet v.
American National Stores, Inc., 708 S.W.2d 273 (Mo. Ct. App. 1986)).

The Court holds that Plaintiff sufficiently alleges the control necessary to state a cause of
action for piercing the corporate veil and/or successor liability against Biewer. Biewer, although
not legally formed at the time of the sale of Plaintiffs decking, clearly existed through Brian and
Tim Biewer. Further, Plaintiff has referenced evidence of common control of Green Tree and
Biewer. Likewise, Plaintiff has presented evidence that Biewer assumed the liabilities of Green
Tree, including evidence that Biewer handled the warranty claims of Green Tree. Therefore, the
Court denies Plaintiffs motion to dismiss Biewer for lack of personal jurisdiction.
2. Contractual Link

Biewer argues that Plaintiffs warranty claims against Bi ewer should be dismissed
because Biewer was not formally organized under Michigan law until after Plaintiffs purchase.
Biewer notes that Plaintiff did not purchase the Monarch Decking from Biewer and Biewer did
not manufacture the Monarch Decking at issue. Most importantly, Biewer states that it never
issued any warranty to Plaintiff related to the Monarch Decking.

Biewer claims that the

allegations in the Complaint are impossible because Biewer was not organized when the product
was manufactured at the time that the warranty was issued to Plaintiff or at the time Plaintiff
purchased the product. (ECF No. 55 at 15).

Biewer contends that the terms of the warranty

- 18 -

clearly state that it is between Green Tree and Plaintiff. (ECF No. 55 at 15-16). Further, Biewer
maintains that Plaintiffs MMP A claim cannot stand against Bi ewer because Bi ewer was not an
original party to the transaction. (ECF No. 55 at 15-16 (citing Reitz v. Nationstar Mortgage,
LLC, 954 F. Supp. 2d 870, 894 (E.D. Mo. 2013) ("Missouri law holds that a MMPA claim may

not be brought against a third-party that was not part of the original transaction.").
Responding to this argument, Plaintiff maintains that Biewer is the alter ego of Green
Tree and also acted as a successor to Green Tree. (ECF No. 70 at 17). Plaintiff refers generally
to the Court to the allegations in its proposed amended complaint.
As previously noted, the Court has found that Plaintiff sufficiently pleaded alter ego
liability and/or successor liability in his Amended Complaint. As a result, the Court holds that
Plaintiff states a claim against Biewer based upon his subsequent liability for Green Tree' s
contractual obligations. Further, at this stage of the litigation, the Court also denies the motion to
dismiss Plaintiffs MMP A claim. The Reitz case, cited by Defendants, did not involve alter ego
or successor liability. Due to the close relationship between alter ego and successor businesses,
the Court notes that Biewer likely would not be considered a "third-party" under Missouri law.
The Court denies Biewer' s motion to dismiss on this basis.
According! y,
IT IS HEREBY ORDERED that Defendant Green Composites, L.L.C.' s Motion to

Dismiss Pursuant to F.R.C.P. 12(B)(6) (ECF No. 52) and Defendant Biewer Lumber, LLC' s
Motion to Dismiss Pursuant to F.R.C.P. 12(B)(2) and 12(B)(6) (ECF No. 54) are GRANTED, in
part, and DENIED, in part. The Court DISMISSES Plaintiff s claims for implied warranty of
merchantability.

- 19 -

IT IS FURTHER ORDERED that the Court VACATES its May 23, 2016 Order
denying Plaintiffs Motion for Leave to File an Amended Pleading and Joint Additional Parties
(ECF No. 57). The Court GRANTS Plaintiff leave to file an Amended Complaint. The Clerk of
the Court is directed to file Plaintiffs Amended Complaint.

IT IS FINALLY ORDERED that the parties shall submit a Joint Scheduling Plan to the
Court within fourteen (14) days of the date of this Order.

Dated

thi~y of June, 2016.

~bbu

RONNIE L. WHITE
UNITED STATES DISTRICT JUDGE

- 20 -