Ellen Cronin Badeaux, LLC et al v. SonicSEO.com, LLC et al
MEMORANDUM OPINION AND ORDER by District Judge Martha Vazquez DENYING 36 MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM . IT IS ORDERED that Defendant's Motion to Dismiss Plaintiff's Second Amended and Supplemental Complaint for Breach of Contract and Damages, Doc. 36 , filed March 14, 2016, is DENIED. (gr)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
Ellen Cronin Badeaux, LLC, et al.,
MEMORANDUM OPINION AND ORDER
THIS MATTER comes before the court on Defendant’s Motion to Dismiss Plaintiff’s
Second Amended and Supplemental Complaint for Breach of Contract and Damages, Doc. 36,
filed March 14, 2016. For the reasons stated herein, Defendant’s Motion to Dismiss is DENIED.
The allegations in the Second Amended Complaint (“SAC”) supporting Plaintiff’s claims
are consistent with those set forth in the First Amended Complaint (“FAC”), and are fully set
forth in the Court’s Memorandum Opinion and Order dated January 27, 2016. Doc. 34. The
Court incorporates those facts by reference herein. By way of summary, Plaintiff Ellen C.
Badeaux, LLC, a law firm in Louisiana, contracted with Defendant AttorneyLocate.com, later
SonicSEO.com (“SonicSEO”), for “website development, maintenance and search engine
optimization.” Doc. 35 ¶ 4. Defendant SonicSEO agreed to create a “Diamond Package website”
for Plaintiff, which entailed “50 pages of Client website Content, and a links page,” and the
creation of a website for the Plaintiff, “http://edbadeaux.com.” Doc. 35 ¶ 5.
After Plaintiff’s AOL email account was hacked and rendered no longer accessible,
Plaintiff contacted SonicSEO and informed it that “her email had been hacked and contact
information on her website needed to be changed.” Doc. 35 ¶ 6. SonicSEO assured Plaintiff that
corrections had been made to her website. Id. After these assurances, Plaintiff “expressed
concern” to SonicSEO that her website traffic had decreased by a third during the fourth quarter
of 2013 and a half during the first quarter of 2014. Doc. 35 ¶ 7. To determine whether emails
were being sent to the correct email address Plaintiff “went to both her mobile…and desktop
website[s] and sent test emails and contacts.” Doc. 35 ¶ 10. Of the six emails that Plaintiff sent,
only one email, sent from her mobile website, was received by Plaintiff in the correct email
Plaintiff then contacted both SonicSEO and her information technology (IT) and email
provider, Microland Computers, Inc. (“Microland”). Id. Microland determined that, while
Plaintiff’s email address on her desktop, which was created, maintained and designed by
SonicSEO, was visibly changed, the link for her desktop website email and all client-contact
forms for both her mobile and desktop emails were sending all contacts to her former AOL email
address, which had been previously rendered inaccessible. Id.
The initial Complaint in this matter was filed on January 14, 2015 as a “Petition for
Breach of Contract and Damages” in the 22nd Judicial District Parish of St. Tammany,
Louisiana. Doc. 1-1. The Complaint alleged only breach of contract claims. After Defendants
filed a Notice of Removal, the First Amended and Supplemental Petition for Breach of Contract
and Damages (“FAC”) was filed in the United States District Court for the Eastern District of
Louisiana on May 19, 2015. Doc. 9. The FAC expanded on the initial Complaint by including
several additional allegations referring to negligence, including negligent hiring, failing to
properly supervise personnel and have proper procedures, etc. Doc. 9 ¶ 9.b.
In its prior Memorandum Opinion and Order granting in part Defendants’ Motion to
Dismiss Plaintiffs’ First Amended Complaint, Doc. 34, this Court dismissed the individually
named plaintiff and defendant, finding that the individually named plaintiff was neither a party
to, nor a third-party beneficiary of the agreement at issue, id. at 6, and that the allegations failed
to pierce the corporate veil in order to make the individually named defendant liable, id. at 7.
The remaining Plaintiff, Ellen C. Badeaux, LLC (“Plaintiff”), filed its Second Amended
Complaint (“SAC”) on February 24, 2016, Doc. 35. Although the SAC amends the parties to the
suit, the allegations remain unchanged from the FAC. The SAC lists six breaches of contract,
including failure “to correct coded website links . . . to maintain the website . . . to monitor
website activity . . . to test the six points of website contact . . . to review the code behind the
website it created and designed; and . . . to act as a reasonable and prudent person would under
the same or similar circumstances . . .” Id. ¶ 12. The SAC does not cite where these obligations
originate in the contract, but states that Defendant was in “breach of its covenant of good faith
and fair dealing in failing to perform rudimentary obligations under the Agreement and its
actions caused economic and personal injury to plaintiff.” Id. ¶ 15.
Plaintiff also claims in the SAC that Defendant is liable for negligent hiring, failures to
train and supervise personnel, and failures to have proper procedures in place that would have
avoided Plaintiff’s damages, id. ¶ 13, stating that “[b]ecause defendant’s misconduct was
wanton, reckless, and fell far short of industry standards and resulted in harmful consequences to
a substantial certainty, plaintiffs’ losses and damages were caused by defendant’s gross fault, and
the limitation of liability clause in the Agreement between [Plaintiff] and [Defendant] is null and
void under New Mexico law.” Id. ¶ 14.
Motion to Dismiss
Motions to Dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure seek
dismissal of a complaint for “failure to state a claim upon which relief can be granted.” Fed. R.
Civ. P. 12(b)(6). To withstand a motion to dismiss, the complaint must contain enough factual
allegations that the claim is plausible on its face. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(citing to Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007)). Facial plausibility exists “when
the plaintiff pleads 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).
However, mere “threadbare recitals of the elements of a cause of action, supported
by…conclusory statements, do not suffice [to establish plausibility].” Id.
“The Court must accept all of the well-pleaded allegations of the complaint as true and
must construe them in the light most favorable to the [non-moving party].” David v. City and
County of Denver, 101 F.3d 1344, 1352 (10th Cir. 1996) (citing to Gagan v. Norton, 35 F.3d
1473, 1474 n. 1 (10th Cir. 1994)). “A complaint may be dismissed pursuant to [Rule] 12(b)(6)
only “if the plaintiff can prove no set of facts to support a claim for relief.” David, 101 F.3d at
1352 (citing to Jojola v. Chavez, 55 F.3d 488, 490 (10th Cir. 1995)) (emphasis added).
Rule 8(a)(2) of the Federal Rules of Civil Procedure states that, “A pleading that states a
claim for relief must contain a short and plain statement of the claim showing that the pleader is
entitled to relief.” A recitation of “facts upon which relief can be granted” does not necessitate
pleading the prima facie elements of a claim. See Swierkiewicz v. Sorema, N.A., 534 U.S. 506,
510-512 (2002). “Specific facts are not necessary; the statement need only ‘give the defendant
fair notice of what the…claim is and the grounds upon which it rests.” Khalik v. United Air
Lines, 671 F.3d 1188, 1192 (10th Cir. 2012) (citing to Erickson v. Pardus, 551 U.S. 89 (2007)).
Breach of Contract
The parties agree that New Mexico law applies to the Breach of Contract claim. Under
New Mexico law, “[t]he plaintiff’s burden of proof…in any action for breach of contract [is to
prove:] the existence of a [contract], the breach thereof, causation, and damages.” Camino Real
Mobile Home Park P’ship v. Wolfe, 119 N.M. 436, 442 (1995) (overruled on other grounds by
Sunnyland Farms, Inc. v. Central N.M. Elec. Co-op, Inc.,301 P.3d 387 (2013)).
Plaintiff’s Second Amended Complaint alleges Defendant breached the contract:
1. By failing to correct coded website links;
2. By failing to maintain the website;
3. By failing to monitor website activity;
4. By failing to test the six points of website contact;
5. By failing to review the code behind the website it created and designed; and
6. By failing to act as a reasonable and prudent person would under the same or
similar circumstances, and any and all other acts of negligence and breach of
contract that may appear at the trial hereof, which acts of negligence and
breach of contract were a proximate cause of the damages in question.
Doc. 35 at 5.
Defendant seeks dismissal of the Second Amended Complaint asserting that:
1. Plaintiff failed to state how Sonic breached its contract with Plaintiff or cite to
the contractual provisions that Plaintiff claims Sonic breached; and
2. Plaintiff failed to allege that the contract created an obligation on the part of
Sonic to do the acts Plaintiff alleged Sonic failed to do.
Doc. 37 at 2-3.1 Defendant further asserts that the contract contains no language mandating the
creation of a links page, nor does the contract contain any language that would require the
Defendant to link the website to Plaintiff’s email address. See Doc. 37 at 3.
The 2-page contract states that Defendant “has expertise in top search engine placement
services” which “are focused on optimizing client’s website for the following five major search
engines: google.com, bing.com, aol.com, yahoo.com, and msn.com.” Doc 41-1 at 1. The primary
provision in the contract states that Defendant:
“[Defendant] will create a Diamond Package website for Client for the Term and
at the Price specified below. A Diamond Package website includes 50 pages of
Client website Content, and a links page. Client website content consists of any
and all information regarding Client contained on Client’s website. Client is
responsible for providing the Client website content except as described below.
Failure of Client to provide or approve content for Client’s website will not alter
Client’s obligation to make payment as set forth in this agreement.”
Id. Secondary provisions in the contract state (i) Plaintiff and Defendant will “agree on the
focus” of Defendant’s services; (ii) Defendant will provide copyrighting services; (iii) Defendant
will provide search engine placement services for Plaintiff’s website; and (iv) Plaintiff will pay
Defendant $999 per month to maintain service. Id. The second page of the contract contains only
general terms and conditions. Id, Pg. 2.
Plaintiff’s Second Amended Complaint states a claim because it identifies six areas with
specific conduct, quoted above, by which Defendant allegedly breached the contract. See Fed. R.
Civ. P. 8(a)(2-3) (“A pleading that states a claim for relief must contain…a short and plain
On Reply, Defendant raises a new argument that Plaintiff agreed to a disclaimer provision among the General
Terms and Conditions attached to the agreement that prevents Plaintiff from obtaining relief in this case. Doc. 41 at
2-4. The provision states that “SonicSEO specifically disclaims any warranty regarding placement on any search
engine, the number of persons who will access your website or the ranking or appearance of client’s website as a
search result for a particular search term or phrase.” Id. at 2. The Court rejects this argument for two reasons. First,
Defendant cannot raise a new argument on reply if it would prejudice Plaintiff to not have an opportunity to
respond. Pippin v. Burlington Resources Oil and Gas Co., 440 F.3d 1186, 1192 (10th Cir. 2006). Second, even if
Defendant had raised this argument in its motion, this provision appears to be irrelevant because Plaintiff’s claims
arise out of an alleged faulty link to her email address, not low traffic to her website.
statement of the claim showing that the pleader is entitled to relief and a demand for the relief
sought…”). Defendant’s assertions that the contract fails to state a claim, because it fails to cite
the contractual provisions that Defendant breached, is not persuasive. There is only one primary
provision regarding Defendant: the obligation to create a website for Plaintiff. That provision,
quoted above, is general, vague, and does not identify the specific actions Defendant must take to
create the website and maintain the search engine placement services.
By setting forth the six areas of specific conduct which form the basis of her breach of
contract claim, Plaintiff has asserted enough factual allegations to give Defendant fair notice of
her claims and the grounds on which they rest. See Khalik, 671 F.3d at 1192 (“Specific facts are
not necessary; the statement need only give the defendant fair notice of what the…claim is and
the grounds upon which it rests.”) (quoted authority omitted). Those alleged facts are sufficient
to state a claim for breach of contract that is plausible on its face. See David, 101 F.3d at 1352
(“The Court must accept all of the well-pleaded allegations of the complaint as true and must
construe them in the light most favorable to the [non-moving party].”) (quoted authority
IT IS ORDERED that Defendant’s Motion to Dismiss Plaintiff’s Second Amended and
Supplemental Complaint for Breach of Contract and Damages, Doc. 36, filed March 14, 2016, is
Dated this 3rd day of October, 2017.
UNITED STATES DISTRICT JUDGE
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