UNITED STATES OF AMERICA v. The McCarty Corporation et al

Filing 34

ORDER DENYING 18 Defendants' Motion to Strike, DENYING 21 Defendants' Motion to Strike, and DENYING 23 Defendants' Motion to Dismiss. The quasi-contract claims against the McCarty defendants in counts four and five of the complaint are withdrawn and are no longer part of the case against the McCarty defendants. Signed by Chief Judge James C. Dever, III on 12/23/2013. (Fisher, M.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:13-CV-409-D

UNITED STATES OF AMERICA,
Plaintiff,

v.

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THE MCCARTY CORPORATION,
MIKE MCCARTY, TEMPLE GRADING
AND CONSTRUCTION COMPANY, INC.,
and JOHN JOSEPH PARDA,
Defendants.

ORDER

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On August 12, 2013, defendants John Joseph Parda and Temple Grading and Construction
Company, Inc. filed a motion to strike portions of plaintiff's complaint and certain exhibits [D.E.
18]. On August 19, 2013, defendants Mike McCarty and the McCarty Corporation ("McCarty
defendants") filed a motion to strike portions of plaintiffs complaint and certain exhibits [D .E. 21].
Defendants rely on Federal Rule of Civil Procedure 12(f) and Federal Rule of Evidence 408 in
support of the motions to strike. Plaintiff opposes the motions to strike [D.E. 25, 30].
The court has reviewed the record and the briefs. Motions to strike are disfavored. See, ~'
Waste Mgt. Holdings. Inc. v. Gilmore, 252 F.3d 316, 347 (4th Cir. 2001). On the current record,
the court cannot conclude that the disputed portions of the complaint or the disputed exhibits are
inadmissable under Rule 408. See, e.g., Fed. R. Evid. 408; Fiberglass Insulators. Inc. v. Duffy, 856
F.2d 652, 654--55 (4th Cir. 1988); see also Ray Comms .. Inc. v. Clear Channel Comms .. Inc., 673
F.3d294, 306 (4th Cir. 2012); Croskeyv. BMW of N. Am .. Inc., 532 F.3d 511,519 (6th Cir. 2008);
Johnson v. Hugo's Skateway, 974 F.2d 1408, 1413 (4th Cir. 1992) (en bane); Bituminous Constr.

v. Rucker Enters .. Inc., 816 F.2d 965,969 (4th Cir. 1987); United States v. Peed, 714 F.2d 7, 9-10
(4th Cir. 1983). Accordingly, the motions to strike [D.E. 18, 21] are denied. This ruling, however,
does not address whether evidence in support of the disputed allegations or the disputed exhibits will
be admissible at summary judgment or at trial. Cf. Fed. R. Civ. P. 56(c)(2); Fed. R. Evid. 408.
As for the McCarty defendants' motion to dismiss plaintiffs complaint under Rules 9(b) and
12(b)(6) of the Federal Rules of Civil Procedure [D.E. 23], the court has reviewed the complaint
under Rule 9(b) 1 and Rule 12(b)(6V Plaintiff has "nudged" its complaint across the line from
conceivable to plausible with respect to plaintiffs first, second, and third causes of action against
the McCarty defendants.

See,~

Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009); Bell Atlantic Com.

v. Twombly, 550 U.S. 544, 570 (2007). This conclusion necessarily means that counts one, two, and
three in plaintiffs complaint against the McCarty defendants also satisfy Rule 9(b) under governing
Fourth Circuit precedent.

See,~' McCauley v. Home Loan Inv. Bank. FSB, 710 F .3d 551,

559-60

(4th Cir. 2013); United States ex rel. Nathan v. Takada Pharms, 707 F.3d 451, 455-61 (4th Cir.
2013); Dunn v. Bo!Y, 369 F.3d 421, 426-35 (4th Cir. 2004). With that said, the McCarty
defendants' motion to dismiss (which includes citations to material that the court cannot consider
under Rule 12(b)(6)) raises serious issues about the government's claims in counts one, two, and
three against the McCarty defendants. Cf., ~, Arnold M. Diamond. Inc. v. Dalto!!, 25 F.3d 1006,

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See,~' McCauleyv. Home Loanlnv. Bank. FSB, 710 F.3d 551,

559-60 (4th Cir. 2013);

United States ex rel. Nathan v. Takada Pharms. N. Am., 707 F.3d 451, 455-61 (4th Cir. 2013);
Adkins v. Crown Auto. Inc., 488 F.3d 225, 231-32 (4th Cir. 2007); Dunn v. Borm, 369 F.3d 421,
426-34 (4th Cir. 2004); United States ex rel. Harrison v. Westinghouse Savannah River Co., 352
F.3d 908, 921-22 (4th Cir. 2003).
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See,~, Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Bell Atl. Com. v. Twombly, 550 U.S.

544, 570 (2007); Coleman v. Md. Court of Aweals, 626 F.3d 187, 190 (4th Cir. 2010), aff'd, 132
S. Ct. 1327 (2012); Giarratano v. Johnson, 521 F.3d 298, 302 (4th Cir. 2008).
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1009-10 (Fed. Cir. 1994); United States v. Turner Constr. Co., 827 F.2d 1554, 1558-62 (Fed. Cir.
1987). Simply because counts one, two, and three in the government's complaint against the
McCarty defendants have nudged across the lines required by Rules 9(b) and 12(b)(6) does not mean
that, on a full record, the government's claims against the McCarty defendants will survive a motion
for summary judgment. As for the government's quasi-contract claims against the McCarty
defendants in counts four and five, see Compl. [D .E. 1] ~~ 140--47), the government has withdrawn
those claims. See [D.E. 29] 29.

In sum, defendants' motions to strike [D.E. 18, 21] are DENIED. The McCarty defendants'
motion to dismiss [D.E. 23] is DENIED. The quasi-contract claims against the McCarty defendants
in counts four and five of the complaint (Compl.

~~

140--47) are withdrawn and are no longer part

of the case against the McCarty defendants.
SO ORDERED. This kl_ day of December 2013.

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