Cook v. Smith et al

Filing 26

Order granting Defendants' 18 Motion for a more definite statement. Plaintiff is Ordered to file an amended complaint within 14 days detailing the content of the alleged misrepresentations made by Defendants, the time(s) at which the alleged misrepresentations were made, and the location(s) where the alleged misrepresentations were made. Magistrate Judge Kathleen B. Burke on 10/9/2012. (P,G)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
R. ANTHONY COOK,
Plaintiff,
v.
JAMES H. SMITH, IND., SPIKE,
INDUSTRIES, INC., KEWEENAW
INDUSTRIES, L.L.C., AND JOHN
AND JANE DOES 1…99
Defendants.

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CASE NO. 4:12-CV-362
MAGISTRATE JUDGE
KATHLEEN B. BURKE

ORDER

This matter is before the Court on the Motion for a More Definite Statement filed by
Defendants James H. Smith, Spike Industries, Inc., and Keweenaw Industries, LLC. 1 Doc. 18.
Defendants argue that Plaintiff failed to comply with Federal Rule of Civil Procedure 9(b) in that
the complaint alleges fraud in Count II and mail fraud and wire fraud in Count IV without stating
with particularity the circumstances constituting the alleged fraud. For the following reasons, the
Court GRANTS Defendants’ Motion for More Definite Statement.
I. Legal Standards
The Federal Rules of Civil Procedure provide that “[a] party may move for a more
definite statement of a pleading to which a responsive pleading is allowed but which is so vague
or ambiguous that the party cannot reasonably prepare a response.” Fed. R. Civ. P. 12(e). In
ruling on motions for more definite statement, courts exercise discretion and consider “the
minimal duty imposed… by the federal pleading rules and the possibility that [the defendant]
might be prejudiced by attempting to answer the pleading in its existing form.” Parus v. Cator,
No. 05–C–0063–C, 2005 WL 1458770, at *3 (W.D. Wis. Sept. 14, 2005).
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It should be noted that Plaintiff did not file an opposition to Defendants’ Motion for a More Definite Statement.
See Docket.

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The sufficiency of a complaint generally is governed by Rule 8, which states, in part, “[a]
pleading… must contain… a short and plain statement of the claim showing that the pleader is
entitled to relief.” Fed. R. Civ. P. 8(a)(2). In addition, in cases such as this one where fraud is
alleged, Rule 9(b) provides heightened pleading requirements. When pleading fraud, a plaintiff
must allege (1) “the time, place, and content of the alleged misrepresentation,” (2) “the
fraudulent scheme,” (3) the defendant’s fraudulent intent, and (4) the resulting injury. United
States ex rel. Bledsoe v. Community Health Sys., 501 F.3d 493, 504 (6th Cir. 2007). Similarly,
when pleading mail or wire fraud, a plaintiff must “(1) specify the statements that the plaintiff
contends were fraudulent; (2) identify the speaker; (3) state where and when the statements were
made, and (4) explain why the statements were fraudulent.” Frank v. Dana Corp., 547 F.3d 564,
570 (6th Cir. 2008) (quoting Gupta v. Terra Nitrogen Corp., 10 F. Supp. 2d 879, 883 (N.D. Ohio
1998)).
II. Analysis
Count II of Plaintiff’s complaint alleges fraud and misrepresentation. Applying the
standard as set forth above in Bledsoe, the complaint, though it meets some of the requirements
for alleging fraud, fails to meet the first element regarding the time, place, and content of the
alleged misrepresentation. Paragraph 8 of the Complaint states that, “[o]n or about August 24,
2009,” Plaintiff and Defendant Cook, as an agent of Spike Industries, “entered into a verbal
agreement in which Plaintiff Cook agreed to provide $200,000.00 to Defendant Smith and Spike
Industries as an investment to ‘restart’ Spike Industries. In return for his investment, Plaintiff
Cook was to receive 20% of the stock in Spike Industries.” Doc. 1, ¶ 8. Plaintiff then alleges
that “Defendant Smith, as an agent for Spike Industries, fraudulently induced Plaintiff Cook to
enter into the agreement in which [Defendant] Smith never intended to perform.” Doc. 1, ¶ 8.

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Plaintiff further alleges that “Defendant Smith made knowing misrepresentations as to the nature
of his investment to Plaintiff Cook with the intention of inducing Plaintiff Cook to provide him
with $200,000.00. Plaintiff Cook relied upon the misrepresentations to his detriment.” Doc. 1, ¶
23. However, Plaintiff has failed to plead the specific misrepresentation(s) made by Defendant
Smith to induce Plaintiff to enter into the agreement, or the time(s) at which and location(s)
where the alleged misrepresentations were made. The allegation that Defendant Smith failed to
actually transfer 20% of the stock in Spike Industries to Plaintiff forms the basis of Plaintiff’s
breach of contract claim, not his fraud claims. Thus, Plaintiff’s complaint, which his silent on
the actual content and circumstances of the fraudulent misrepresentations allegedly made by
Defendants, is deficient under Rule 9(b). Smith v. Litton Loan Servicing, L.P., 1:11-CV-1705,
2011 WL 4696177, at *3 (N.D. Ohio Oct. 5, 2011); Bledsoe, 501 F.3d at 504.
Count IV of Plaintiff’s complaint alleges mail fraud and wire fraud and incorporates the
statements above concerning the formation of the verbal agreement. Again, under the standard
set forth above in Frank, the complaint fails to specify the contents of the alleged
misrepresentations or the time(s) at which and location(s) where the alleged misrepresentations
were made. Thus, the complaint is also deficient as it pertains to Plaintiff’s mail and wire fraud
claims. Frank, 547 F.3d at 570.
Without greater particularity as to the content or circumstances surrounding the alleged
misrepresentations, Defendants will be forced to speculate in responding to the allegations of the
complaint. Defendants are therefore entitled to a more definite statement before preparing their
Answer. “Rule 9(b) does not require omniscience; rather, the Rule requires that the
circumstances of the fraud be pled with enough specificity to put defendants on notice as to the
nature of the claim.” Michaels Bldg. Co. v. Ameritrust Co., N.A., 848 F.2d 674, 680 (6th Cir.

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1988). Here, the complaint fails to comply with Rule 9(b) and thus fails to provide Defendants
with sufficient notice as to the nature of Plaintiff’s fraud and mail/wire fraud claims.
Accordingly, Defendants’ Motion is GRANTED.
III. Conclusion
For the foregoing reasons, Defendants’ Motion for a More Definite Statement is
GRANTED. Doc. 18. Plaintiff is ORDERED to file an amended complaint within 14 days
detailing the content of the alleged misrepresentations made by Defendants, the time(s) at which
the alleged misrepresentations were made, and the location(s) where the alleged
misrepresentations were made.
IT IS SO ORDERED

Dated: October 9, 2012

______________________________
Kathleen B. Burke
United States Magistrate Judge

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