K-Flex USA, L.L.C. v. Armacell, LLC
ORDER denying 11 Motion to Dismiss for Failure to State a Claim. Signed by US District Judge Terrence W. Boyle on 10/24/2017. (Stouch, L.)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
This matter is before the Court on defendant's motion to dismiss plaintiff's claims
pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure [DE 11}. The matter has been
fully briefed and is ripe for ruling. For the reasons discussed below, the motion td dismiss is
Defendant Armacell and plaintiffK-Flex both manufacture types of foam pipe insulation.
Plaintiff exclusively manufactures elastomeric foam, which is derived from rubber. Defendant
manufactures both elastomeric foam and polyethylene foam, known as PE foam. While both
types are used for insulation, elastomeric foam, with its higher cost and higher temperature
resistance, is primarily a product in industrial settings. K-Flex worked with a distributor, Sunbelt
Inc., in the southeast for several years. Sunbelt began working with Armacell in early 2017, and
almost immediately thereafter terminated its business arrangement with K-Flex. K-Flex alleges
that termination was due to Armacell's coercion, which forms the basis for the_instant complaint.
K-Flex has alleged four separate claims against Armacell: violations of Sections 1 and 2 of the
Sherman Act, a violation of the Clayton Act, and a violation of North Carolina's Unfair and
Deceptive Trade Practices Act. This Court has subject matter jurisdiction on the basis of a
federal question over the federal law claims, and exercises supplemental jurisdiction over the
remaining state law claim under 28 U.S.C. §1367.
Defendant's motion to dismiss the claims is made under Rule 12(b)(6) of the Federal
Rules of Civil Procedure. A Rule 12(b)(6) motion tests the legal sufficiency of the complaint.
Papasan v. Allain, 478 U.S. 265, 283 (1986). When acting on a motion to dismiss under Rule
12(b)(6), "the court should accept as true all well-pleaded allegations and should view the
complaint in a light most favorable to the plaintiff." Mylan Labs., Inc. v. Matkari, 7 F.3d 1130,
1134 (4th Cir.1993). A complaint must allege enough facts to state a claim for reliefthat is
facially plausible. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). Facial plausibility
means that the facts pled "allow the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged," and mere recitals of the elements of a cause of action
supported by conclusory statements do not suffice. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
A complaint must be dismissed if the factual allegations do not nudge the plaintiffs claims
"across the line from conceivable to plausible." Twombly, 550 U.S. at 570.
However, the Court need not accept a complaint's "leg
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