Famous Enterprises, Inc. et al. v. Traditions of America, L.P.

Filing 17

Order denying Defendants' Motion to Dismiss and Motion to Transfer Venue (Related Doc # 12 , 13 ). Judge Solomon Oliver, Jr. on 3/10/2025.(R,Sh)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

FAMOUS ENTERPRISES
INC., et al.
Plaintiffs
v.
TRADITIONS OF AMERICA, L.P., et al.
Defendants

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Case No.: 1:24 CV 61

JUDGE SOLOMON OLIVER, JR.

ORDER

Currently pending before the court in the above-captioned case is Defendants Traditions of
America, L.P. (“Traditions”) and TOA Construction, Inc.’s (“TOA”) (collectively, “Defendants”)
Motion to Dismiss and Motion to Transfer Venue (“Motions”) (ECF Nos. 12, 13). For the following
reasons, the court denies the Motions.
I. BACKGROUND
A.

Factual Background
Plaintiffs Famous Enterprises, Inc. and Famous Distribution, Inc., dba Famous Supply

(collectively, “Famous”) are Ohio corporations. (Am. Compl.¶ 1, ECF No. 7.) Defendants
Traditions, a Pennsylvania limited partnership, and TOA, a Pennsylvania corporation, are allegedly
affiliated entities. (Id. ¶¶ 2–4.) On or about February 8, 2013, Defendant Traditions and/or TOA
applied for a line of credit with Plaintiff Famous Enterprises. (Am. Compl. ¶ 7; see also Ex. A at
PageID 68.) The credit application required Traditions and/or TOA to agree to certain terms and
conditions, including the consequences they would face should they default in the payment of any
invoice. (Id. ¶ 8; Ex. A at PageID 69.) In reliance on Tradition’s and/or TOA’s representations in the

credit application, Famous opened an account through which Defendants could purchase goods and
materials from Plaintiff for various property improvement projects. (Id. ¶ 10–11.)
Between May 30, 2014, and October 13, 2022, Defendants ordered thousands of goods and
materials from Famous, all of which Famous delivered to Defendants along with the relevant
invoices. (Id. ¶ 12; see also Ex. B at PageID 70–76.) But, Defendants allegedly failed to pay for most
of the goods, thereby incurring an unpaid principal balance on their account with Famous for
$168,788.98 plus interest. (Id. ¶ 14.) On October 26, 2023, Famous notified Defendants of the
default, and demanded Defendants pay the past due amount immediately plus the two percent
monthly interest agreed to in credit application. (Id. ¶ 15; Ex. D at PageID 579.) Defendants did not
cure the defaults, and so Famous filed the instant action. (Id. ¶ 16.)
B.

Procedural Background
On November 30, 2023, Plaintiffs filed a Complaint against Defendant Traditions in the

Court of Common Pleas of Cuyahoga County, Ohio, alleging Breach of Account Agreement (Count
I) and Unjust Enrichment (Count II). (Removal at PageID 1, ECF. No. 1.) Plaintiffs referenced and
attached three exhibits to their original Complaint: the credit application underlying the account
agreement, a statement of unpaid invoices, and Plaintiffs’ notice of default to Traditions. (See Ex.
A–C at PageID 16–25.) On January 10, 2024, Traditions removed the action to this court, asserting
as the basis for federal jurisdiction complete diversity pursuant to 28 U.S.C. § 1332. (Removal at
PageID 2.) Shortly after removing the case, Defendant Traditions filed a Motion to Dismiss and
Transfer Venue (ECF Nos. 5, 6) (“January Motion”) on January 26, 2024. Attached to Defendant’s
Motion was a “Building Supply Agreement” (“BSA”), a document not referenced in or attached to
the Complaint, but principally relied on by Traditions for why the court should dismiss and transfer
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Plaintiffs’ suit. (Jan. Mot. at PageID 52.)
On February 5, 2024, Plaintiffs filed an Amended Complaint (ECF No. 7) adding TOA as
a Defendant and a claim for Declaratory Judgment. In its claim for Declaratory Judgment, Plaintiffs
addressed the document that Defendant Traditions discussed and attached to its January Motion.
(Am. Compl. at PageID 63.) Plaintiffs alleged that sometime in 2018 they were approached by
Defendant TOA about possibly entering a building supply agreement. (Id. ¶ 26.) During negotiations
about the proposed agreement, TOA sent Famous a draft for review. (Id. ¶ 27.) Famous rejected the
draft agreement and sent TOA a counteroffer draft agreement which included additional terms and
conditions about delivery, timely receipt of materials, and how the parties could terminate the
agreement. (Id. ¶ 28; Ex. E at PageID 586.) TOA rejected Famous’s counteroffer by failing to
execute and return the revised draft or communicate in a reasonable time its acceptance. (Id. ¶ 29.)
Famous also attached to the Amended Complaint the three exhibits originally included, as well as
502 pages of unpaid invoices related to the Account Agreement and a version of the BSA which
included an addendum not referenced in Traditions’ January Motion. (See Exs. C, E at PageID
77–578, 580–586.)
Four days after filing the Amended Complaint, Plaintiffs filed a Brief in Opposition (ECF
No. 8) to Defendant Traditions’ January Motion. In their Brief, Plaintiffs argued the January Motion
should be denied because the Amended Complaint made it moot, it was improperly based upon
matters outside Plaintiffs’ Original Complaint, and Plaintiffs did not enter the alleged BSA. (Opp’n
at PageID 587.) Defendant Traditions did not file a Reply in support of its January Motion, but
Traditions and TOA did file a Motion to Dismiss and/or Transfer the Amended Complaint (“April
Motion”) on April 9, 2024. (ECF Nos. 12, 13.) Notably, Defendants made substantively the same
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arguments in their April Motion as those in the January Motion, but they did not attach the alleged
BSA. Rather, Defendants only referenced the version Plaintiffs included to support their claim for
declaratory judgment. (April Mot. at PageID 609.) Plaintiffs filed their Opposition Brief (ECF No.
15) on May 9, 2024. On September 26, 2024, the court denied Defendant Traditions’s January 26,
2024, Motion to Dismiss as moot. (ECF No. 16.) The Motion responding to Plaintiffs’ Amended
Complaint is now fully briefed and ripe for review.
II. LEGAL STANDARDS
A.

Motion to Dismiss
The court examines the legal sufficiency of a plaintiff’s claims under the Federal Rule of

Civil Procedure 12(b)(6). The United States Supreme Court clarified the law regarding what a
plaintiff must plead in order to survive a motion made pursuant to Rule 12(b)(6) in Bell Atl. Corp.
v Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009). When determining
whether a plaintiff has stated a claim upon which relief can be granted, the court must construe the
complaint in the light most favorable to the plaintiff, accept all factual allegations as true, and
determine whether the complaint contains “enough facts to state a claim to relief that is plausible on
its face.” Twombly, 550 U.S. at 570. The plaintiff’s obligation “requires more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. at 555.
Even though a complaint need not contain “detailed” factual allegations, its “[f]actual allegations
must be enough to raise a right to relief above the speculative level on the assumption that all the
allegations in the Complaint are true.” Id. A court is “not bound to accept as true a legal conclusion
couched as a factual allegation.” Papasan v. Allain, 478 U.S. 265, 286 (1986).
The Court, in Iqbal, further explained the “plausibility” requirement, stating that “[a] claim
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has facial plausibility when the plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.” 556 U.S. at 678.
Furthermore, [t]he plausibility standard is not akin to a ‘probability requirement,’ but it asks for more
than a sheer possibility that a defendant has acted unlawfully.” Id. This determination is a “contextspecific task that requires the reviewing court to draw on its judicial experience and common sense.”
Id. at 679.
Generally, when ruling on a Rule 12(b)(6) motion, the court is limited to the allegations of
the complaint and any exhibits attached thereto. Bassett v. National Collegiate Athletic Ass’n., 528
F.3d 426, 430 (6th Cir. 2008). Federal Rule of Civil Procedure 10(c) allows the court to consider a
copy of any “written instrument” attached as an exhibit to a pleading to be part of the pleading “for
all purposes.” Fed. R. Civ. P. 10(c). Such “written instruments” include “a document evidencing
legal rights or duties or giving formal expression to a legal act or agreement, such as a deed, will,
bond, lease, insurance policy or security agreement.” Benzon v. Morgan Stanley Distributors, Inc.,
No. 3:03-0159, 2004 WL 62747, *2 (M.D. Tenn. Jan. 8, 2004), aff’d, 420 F.3d 598 (6th Cir. 2005).
Contracts and other writings on which a party’s action or defense is based fall within this
definition. Id.
B.

Motion to Transfer Venue
Section 1404 of Title 28 governs the transfer of actions from one court to another. Subsection

(a) provides: “For the convenience of parties and witnesses, in the interest of justice, a district court
may transfer any civil action to any other district or division where it might have been brought or to
any district or division to which all parties have consented.” 28 U.S.C. § 1404(a). A district court
should consider “the private interests of the parties, including their convenience and the convenience
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of potential witnesses, public-interest concerns, as well as whether the transfer is in the interests of
justice,” when ruling on a motion to transfer. Boling v. Prospect Funding Holdings, LLC, 771
F. App’x 562, 567 (6th Cir. 2019) (citing Moses v. Bus. Card Express Inc., 929 F.2d 1131, 1137 (6th
Cir. 1991). The Supreme Court explained in Atlantic Marine Constr. Co. v. United States Dist.
Court, 571 U.S. 49, 59 (2013), that this subsection is essentially “a mechanism for enforcement of
forum-selection clauses that point to a particular federal district.”
In the Sixth Circuit, courts should uphold a forum selection clause “unless there is a strong
showing that the clause should be set aside.” Boling, 771 F. App’x at 568 (citing Wong v.
PartyGaming Ltd., 589 F.3d 821, 828 (6th Cir. 2009)). In a diversity suit, federal law governs the
enforceability of a forum selection clause. Wong, 589 F.3d at 826. Courts evaluate the enforceability
of a forum selection clause by considering: “(1) whether the clause was obtained by fraud, duress,
or other unconscionable means; (2) whether the designated forum would ineffectively or unfairly
handle the suit; and (3) whether the designated forum would be so seriously inconvenient such that
requiring the plaintiff to bring suit there would be unjust.” Id. at 828. “The party opposing the forum
selection clause bears the burden of showing that the clause should not be enforced.” Id.
III. LAW AND ANALYSIS
A.

Motion to Dismiss
Defendants first argue that Plaintiffs’ Breach of Account Agreement and Unjust Enrichment

claims should be dismissed for failure to state a claim because they arise from the Account
Agreement (“AA”), which Defendants contend is not the contract governing the goods and services
for which Traditions and/or TOA allegedly failed to pay. (April Mot. at PageID 610.) Instead,
Defendants assert that the controlling contract is a fully integrated Building Supply Agreement
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(“BSA”) which Defendants claim Famous and TOA entered August 12, 2016. (Id. at PageID 605.)
Because the BSA governs, Defendants argue this court should apply Pennsylvania law to decide the
Motion to Dismiss, and it should transfer the case to the District Court for the Western District of
Pennsylvania pursuant to the BSA’s forum selection clause. (Id.)
Plaintiffs maintain that the operative contract between the parties is the AA, and it is from
that agreement that their claims arise, not the alleged BSA. (Opp’n at PageID 619.) Further, Plaintiffs
contend that the BSA cannot govern the parties’ relationship because (1) Defendants offer no
evidentiary support for their contention that the BSA is a valid, enforceable contract; (2) neither
Plaintiff is listed as a party to the BSA, nor is Traditions; and (3) at the motion to dismiss stage, the
court accepts as true and draws all reasonable inferences from Plaintiffs’ fact allegations about the
AA and BSA. (Opp’n at PageID 624–25.) Plaintiffs’ arguments are well-taken.
Plaintiffs correctly assert that on a motion to dismiss, the court construes the complaint in
the light most favorable to the plaintiff, accepts all factual allegations as true, and determines
whether the complaint contains “enough facts to state a claim to relief that is plausible on its face.”
Twombly, 550 U.S. at 570. By arguing that the BSA controls the instant contract dispute, Defendants
outright ignore Plaintiffs’ well-pleaded factual allegations and essentially ask the court to enforce
an integration clause of an alleged agreement between the parties. (Mot. at PageID 610–11.) This
argument is inappropriate at the motion to dismiss stage. See Prestige Display & Packaging, LLC
v. Temple-Inland, Inc., No. 1:11-CV-00710, 2012 WL 2319253, at *3 (S.D. Ohio June 19, 2012).
In Prestige Display, the defendant made a similar argument to that made by Traditions and
TOA in this case. Like Traditions and TOA, the Prestige Display defendant moved to dismiss the
plaintiff’s complaint on the basis that a document other than the one plaintiff based its claims was
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the controlling agreement between the parties. Id. at *1. That agreement, like the alleged BSA,
contained a forum selection clause, and, according to the defendant, governed the parties’ disputed
transactions. Id. at *3. The Prestige Display court declined to substitute the agreement explicitly
referenced in and attached to the plaintiff’s complaint for the document the defendant claimed was
controlling, especially since the alleged document was not attached to the defendant’s motion to
dismiss. Id. In doing so, the court concluded that:
On the record before it, the Court cannot ascertain whether the Terms
of Sales Contract should govern this matter and, assuming arguendo,
that it does, the Court cannot determine, on this record, whether it is
enforceable against the parties.
Id. at *4. That same logic can apply here.
In their Motion, Traditions and TOA ask this court to enforce two provisions of an alleged
agreement between the parties: an integration clause and a forum selection clause. However, they
do not attach the version of the BSA they argue controls to their Motion, nor do Plaintiffs reference
any version of the BSA in their breach of contract or unjust enrichment claims. It is true that
Plaintiffs discuss a draft version of the BSA in their claim for declaratory judgment, and attach said
draft to their Amended Complaint. Even so, Plaintiffs allege facts about the draft BSA from which
the court can plausibly infer that the document Defendants claim controls the dispute does not exist.
Also, Defendants do not challenge these allegations in their Motion. Thus, like the Presige Display
court, this court cannot ascertain whether the terms of the BSA govern this matter or whether it is
enforceable against the parties. Accordingly, the court examines the sufficiency of Plaintiffs’
Amended Complaint as it relates to the Account Agreement, not the purported Building Supply
Agreement.

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Plaintiffs allege Defendants breached the AA by failing to pay for the goods and materials
they purchased and Plaintiffs delivered. (Am. Compl. ¶¶ 19, 21.) To state a claim for breach of
contract under Ohio law, Plaintiffs must establish that (1) a contract existed, (2) Plaintiffs fulfilled
their obligations, (3) Defendants failed to fulfill their obligations, and (4) Plaintiffs suffered damages
as a result of Defendants’ failure. Pavlovich v. National City Bank, 435 F.3d 560, 565 (6th Cir. 2006)
(citing Wauseon Plaza Ltd. P’ship v. Wauseon Hardware Co.,807 N.E.2d 953, 957 (Ohio Ct. App.
2004)). Plaintiffs must also show that there was a “meeting of the minds” and that the contract was
definite as to its essential terms. Episcopal Retirement Homes, Inc. v. Ohio Dept. Of Indus.
Relations, 575 N.E.2d 134 (Ohio 1991).
The court finds that the Amended Complaint adequately pleads all four elements for a breach
of contract claim under Ohio law. First, Plaintiffs allege the AA constitutes a valid agreement
between the parties that was entered into via the credit application submitted by Traditions and/or
TOA Construction on or about February 8, 2023. (Am. Compl. ¶ 7.) The credit application, attached
as Exhibit A, also supports a finding that Plaintiffs sufficiently alleged the existence of a valid
agreement, as it shows Defendant Traditions as the applicant, a signature by the applicant’s CFO,
and acknowledgment of the terms and conditions for entering the account agreement with Famous.
(Ex. A at PageID 68–69.) While some of the credit terms are crossed out, each of these edits is
accompanied by what appears to be an initial, from which the court can reasonably infer are agreedto deletions. (Id.) The credit Application also includes notations referencing attachments detailing
the applicant’s “Trade References,” “Names of Owners or Partners,” “Names of Officers,” and “Key
Contacts.” (Id.) While these attachments are not part of the Amended Complaint, the credit
application still appears to contain the essential terms needed for the court to determine what the
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agreement is, when a breach occurs, and a basis for giving an appropriate remedy. See Steinen v.
Ohio Div. of Wildlife, 36 N.E.3d 196, 202 (Ohio Ct. App. 2015) (“The terms of a contract are
reasonably certain if they provide a basis for determining the existence of a breach and for giving
an appropriate remedy”) (internal citations omitted). Thus, the court can still accept as true Plaintiffs’
allegation that the AA is a valid agreement between the parties at the motion to dismiss stage.
Second, Plaintiffs sufficiently allege they fulfilled their obligations under the AA by pleading
that “[i]n reliance upon the credit application, Famous opened an account for Traditions and/or TOA
Construction[,]” and that “Famous duly delivered and/or supplied all the goods and/or materials that
Traditions and/or TOA Construction ordered from Famous and issued invoices.” (Am. Compl. ¶¶ 10,
12.) Accepting these allegations as true, the court finds Plaintiffs satisfy the second element for an
Ohio breach of contract claim.
With regards to Defendants’ breach, Plaintiffs allege that, “Traditions and/or TOA
Construction then proceeded to purchase goods and/or materials from Famous, on account, for
various improvement projects,]” and that “Traditions and/or TOA Construction failed to pay Famous
for all the goods and/or materials that Traditions and/or TOA Construction ordered from Famous,
and accumulated an unpaid principal balance on its account [...].” (Id. ¶¶ 11, 14.) In support of this
factual allegation, Plaintiffs point to Exhibits B and C to the Amended Complaint. Exhibit B is a
Statement of Famous’s outstanding and unpaid invoices, and Exhibit C is copies of those invoices
listed in the Statement. (Exs. B, C at PageID 70–578.) From these Exhibits, the court can reasonably
infer that Defendants have breached the AA by failing to fulfill their obligation of paying for the
products purchased on account from Famous. Thus, the third element is satisfied.
Finally, Plaintiffs sufficiently allege facts as to damages resulting from Defendants’ breach
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by pleading the amount unpaid by Defendants on their account with Famous is $168,788.98 plus
interest. (Am. Compl. ¶ 14, 22.) Bolstering this allegation is Exhibit D, which is a Notice of Default
of Account Agreement and Demand for Payment sent to Traditions notifying it of its obligation
under the AA and the amount owed. (Ex. D at PageID 579.) Construing these facts in the light most
favorable to Plaintiffs and accepting them as true, the court finds Plaintiffs sufficiently pled damages
under Ohio contract law. Therefore, Count One of the Amended Complaint survives Defendants’
Motion to Dismiss.
Count Two of the Amended Complaint is for unjust enrichment. Defendants argue this claim
is barred by the “gist of the action doctrine” because it arises from the same agreement—which they
maintain is the BSA—for materials and services and seeks the same amount in damages as pled in
Plaintiffs’ breach of account agreement claim. (April Mot. at PageID 611–12.) Plaintiffs contend that
Ohio law permits pleading unjust enrichment as an alternative to breach of contract when the validity
and enforceability of the AA is still disputed. (Opp’n at PageID 626.) Plaintiffs’ argument is welltaken.
Ohio law recognizes alternative pleading, meaning that “a party may plead both a breach-ofcontract claim and an unjust-enrichment claim without negating the validity of either claim.”
Cristino v. Adm’r, 977 N.E.2d 742, 753 (Ohio Ct. App. 2012). A party cannot recover under both
theories when the contract claim and unjust enrichment claim rely on the same subject matter, but
“[t]he mere presence of both claims in a complaint does not warrant the dismissal of the unjustenrichment claim” on a 12(b)(6) motion. Id. See also Bldg. Indus. Consultants, Inc. v. 3M Parkway,
Inc. 911 N.E.2d 356 (Ohio Ct. App. 2009). Because the parties still dispute the validity and
enforceability of the AA, Defendants’ argument for dismissing Plaintiffs’ unjust enrichment claim
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is unpersuasive.
To establish a claim for unjust enrichment under Ohio law, a plaintiff must show: “(1) a
benefit conferred by a plaintiff upon a defendant; (2) knowledge by the defendant of the benefit; and
(3) retention of the benefit by the defendant under circumstances where it would be unjust to do so
without payment.” Hambleton v. R.G. Barry Corp., 465 N.E.2d 1298, 1302 (Ohio 1984). Here,
Plaintiffs sufficiently plead each element by alleging that (1) it conferred a benefit to Defendants by
allowing Defendants to purchase on credit building materials and services from Famous, (2)
Defendants knowingly received, accepted, and retained those services; and (3) such retention of
those services and materials by Defendants would be unjust without payment. (Am. Compl. ¶¶ 7,
10–14, 21–24.) Accordingly, Count Two of Plaintiffs Amended Complaint to survives Defendants’
12(b)(6) Motion to Dismiss.
Because Plaintiffs have adequately stated claims for Breach of Account Agreement and
Unjust Enrichment, Defendants’ Motion to Dismiss under Federal Rule of Civil Procedure 12(b)(6)
(ECF No. 12,13) is denied.
B.

Motion to Transfer
Defendants argue that this action should be transferred to the Western District of

Pennsylvania pursuant to 28 U.S.C. 1404(a) because the BSA contains a forum selection clause
declaring that any litigation arising from it must be brought in Pennsylvania. (April Mot. at PageID
612.) Plaintiffs reject this assertion by explaining they have not brought any claims under the BSA,
and even if the court construes Defendants’ request as one not limited to claims under the BSA, the
argument still fails because it it premised on the BSA being a valid and enforceable contract. (Opp’n
at PageID 627.) The court agrees with Plaintiffs.
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Defendants Motion for Transfer puts the cart before the horse. At this stage of litigation, the
court must accept as true Plaintiffs’ well-pleaded allegations that its claims arise under the AA, not
the BSA, and that Plaintiffs never entered the BSA. (Am. Compl. ¶ 28.) It is true that courts can
enforce a forum selection clause before deciding the overall validity of a contract. See Contract
Transp. Servs. v. New Era Lending LLC, No. 1:17-CV-1322, 2017 WL 7371188, * 3 (N.D. Ohio,
Oct. 2, 2017) (rejecting plaintiffs’ argument that the forum selection clause could not be enforced
based on plaintiffs challenging the validity of the contract overall because “[a] forum-selection
clause is severable from the remaining contract.”); Yaroma v. CashCall, Inc., 130 F.Supp. 3d 1055,
1060 (E.D. Ky. 2015) (citing Shell v. R.W. Sturge, Ltd., 55 F. 3d 1227, 1232 (6th Cir. 1995) (same)).
But in those cases, there was only one or one set of controlling agreements being challenged,
whereas here there are two alleged agreements, and the one containing the forum selection clause
is not the agreement on which Plaintiffs base their claims. Accordingly, the court declines to evaluate
the enforceability of the BSA forum selection clause at the motion to dismiss stage. And, because
Defendants rest their entire Motion to Transfer on the forum selection clause and do not otherwise
address the factors courts consider when ruling on a motion to transfer under 28 U.S.C. § 1404(a),
the court denies the Motion.
IV. CONCLUSION
For the foregoing reasons, the court denies Defendants’ Motions to Dismiss and Transfer
Venue (ECF Nos. 12, 13).
IT IS SO ORDERED.
/s/ SOLOMON OLIVER, JR.
UNITED STATES DISTRICT JUDGE
March 10, 2025
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