Southern Transportation, Inc. v. Lyft, Inc. et al
Filing
74
ORDER denying 72 Motion to Certify Class; denying 73 Motion to Certify Class; granting 33 Motion to Dismiss for Failure to State a Claim; granting 35 Motion to Dismiss for Failure to State a Claim. Signed by Judge Samuel H. Mays, Jr on 06/30/2017. (Mays, Samuel)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
WESTERN DIVISION
SOUTHERN TRANSPORTATION, INC.,
Plaintiff,
v.
LYFT, INC.; UBER TECHNOLOGIES,
INC.; and RASIER, LLC,
Defendants.
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No. 16-02669
ORDER
Before the Court is Defendant Lyft, Inc.’s October 17, 2016
Motion
to
Dismiss
(“Lyft’s
Motion”).
(ECF
No.
33
at
91.1)
Plaintiff Southern Transportation, Inc., responded on November
14, 2016.
2016.
(ECF No. 46 at 158.)
Lyft replied on December 8,
(ECF No. 58 at 200.)
Also before the Court is Defendant Uber Technologies, Inc.,
and Rasier, LLC’s (collectively, the “Uber Defendants”) October
20, 2016 Motion to Dismiss (“Uber’s Motion”).
113.)
158.)
Plaintiff responded on November 14, 2016.
(ECF No. 46 at
The Uber Defendants replied on December 8, 2016.
No. 59 at 213.)
1
(ECF No. 35 at
(ECF
Plaintiff filed a supplemental response on
Unless otherwise noted, all pin cites for record citations are to the
“PageID” page number.
February 7, 2017.
(ECF No. 63 at 244.)
The Uber Defendants
filed a supplemental reply on February 21, 2017.
(ECF No. 64 at
246.)
For the following reasons, Lyft’s Motion and Uber’s Motion
are GRANTED.
I.
Background
On August 16, 2016, Plaintiff filed this action against
Defendants,
with
business
relationships, acting in concert, and “class action.”
(ECF No.
1
¶¶
alleging
24-48
at
intentional
6-11.)
interference
Plaintiff’s
Complaint
alleges
the
taxicab
service,
and
following facts.
Plaintiff
operates
Yellow
Cabs,
a
other passenger-transportation services in Memphis, Tennessee,
and
the
surrounding
transportation
to
area.
and
from
Plaintiff
Memphis
provides
International
various hotels, restaurants, and other businesses.
at 3.)
passenger
Airport
and
(Id. ¶¶ 8-9
In April 2014, Defendants began providing passenger-
transportation
services
in
Memphis
and
the
surrounding
area.
Defendants also provide passenger transportation to and from the
same kinds of businesses as Plaintiff.
(Id. ¶¶ 10, 16 at 3-4.)
Defendants are “transportation network companies.”
¶ 11
at
3.)
They
operate
digital
networks
that
passengers with drivers who provide prearranged rides.
¶ 12 at 3.)
(Id.
connect
(Id.
Through this system, passengers request rides using
2
Defendants’ digital networks, and the digital networks in turn
connect
passengers
with
drivers
their personal vehicles.
who
provide
the
rides
using
Of the fee a passenger pays for a
ride, a portion goes to the driver and a portion to Defendants.
(Id. ¶¶ 13-15 at 3-4.)
Plaintiff alleges that Defendants, acting in concert with
their
drivers,
“have
and
continue
to
intentionally
with the business relationships of” Plaintiff.
see also id. ¶¶ 24-29 at 6-7.)
interfere
(Id. ¶ 30 at 7;
Plaintiff alleges that it has
prospective business relationships with “all persons in Memphis
and
the
surrounding
area
services.”
(Id. ¶ 31 at 8.)
Defendants
provide
desiring
the
passenger
transportation
Plaintiff alleges that both it and
same
service
in
the
same
market.
Plaintiff alleges that, because Defendants are aware of their
own prospective business relationships and are aware that other
companies provide passenger-transportation services in Memphis
and
the
surrounding
area,
Defendants
have
Plaintiff’s prospective business relationships.
knowledge
of
(Id. ¶ 32 at
8.)
Plaintiff
alleges
that
“Defendants
have
and
continue
to
intend to cause breach of plaintiff’s prospective relations.”
(Id. ¶ 33 at 8.)
“provide
the
same
Plaintiff contends that it and Defendants
service
to
the
same
market,
and
business
gained by one party generally means business lost by the other
3
party.”
(Id.)
Plaintiff alleges that “Defendants desire to
interfere with plaintiff’s business relations and take business
from
plaintiff,
or
they
know
that
the
interference
is
substantially certain to occur as a result of their actions.”
(Id.)
Plaintiff alleges that “Defendants know and intend that
their actions will result in a loss of business and income to
the plaintiff.”
(Id.)
Plaintiff alleges that Defendants “have and continue to use
improper
means
relations.”
to
interfere
(Id. ¶ 34 at 9.)
with
plaintiff’s
business
Plaintiff alleges that, while it
has operated in full compliance with various Tennessee statutes
and Memphis city ordinances regulating passenger-transportation
services, Defendants have “failed and refused to comply” with
those authorities, “operat[ing] illegally in defiance of these
statutes
and
ordinances.”
(Id.
¶¶
22-23,
34
at
5-6,
9.)
Plaintiff contends that it has lost income and profits as a
result of Defendants’ interference with its business relations.
(Id. ¶ 35 at 9.)
Plaintiff seeks to bring this action on behalf of itself
and a class of other similarly situated parties.
at 10-12.)
(Id. ¶¶ 40-48
Plaintiff seeks compensatory and punitive damages,
disgorgement of profits, costs, and attorney’s fees.
12.)
4
(Id. at
II.
Jurisdiction and Choice of Law
Under
28
jurisdiction
U.S.C.
over
§ 1332(a),
all
civil
this
actions
Court
has
between
original
citizens
of
different states “where the matter in controversy exceeds the
sum or value of $75,000, exclusive of interest and costs.”
U.S.C. § 1332(a)(1).
Plaintiff is a Tennessee corporation with
its principal place of business in Tennessee.
1.)
28
Rasier’s sole member is Uber.
(ECF No. 1 ¶ 1 at
(ECF No. 66 at 268.)
Both
Lyft and Uber are Delaware corporations with their principal
places of business in California.
(ECF No. 1 ¶¶ 2-3 at 1-2.)
Plaintiff seeks damages in excess of $75,000.
(Id. ¶ 7 at 2.)
The
the
parties
are
completely
diverse,
and
amount-in-
controversy requirement is satisfied.
In a diversity action, state substantive law governs.
See
Brocklehurst v. PPG Indus., Inc., 123 F.3d 890, 894 (6th Cir.
1997) (citing Erie R.R. v. Tompkins, 304 U.S. 64, 78 (1938)).
Where,
as
here,
there
is
no
dispute
that
a
certain
state’s
substantive law applies, the court will not conduct a “choice of
law” analysis sua sponte.
See GBJ Corp. v. E. Ohio Paving Co.,
139 F.3d 1080, 1085 (6th Cir. 1998).
Tennessee substantive law
applies.
III. Standard of Review
In addressing a motion to dismiss for failure to state a
claim under Federal Rule of Civil Procedure 12(b)(6), the court
5
must construe the complaint in the light most favorable to the
plaintiff and accept all well-pled factual allegations as true.
League of United Latin Am. Citizens v. Bredesen, 500 F.3d 523,
527
(6th
Cir.
2007).
A
plaintiff
can
support
a
claim
“by
showing any set of facts consistent with the allegations in the
complaint.”
Bell
Atl.
Corp.
v.
Twombly,
550
U.S.
544,
563
(2007).
This standard requires more than bare assertions of legal
conclusions.
Tackett v. M&G Polymers, USA, LLC, 561 F.3d 478,
488 (6th Cir. 2009).
“[A] formulaic recitation of the elements
of a cause of action will not do.”
To
survive
a
motion
to
dismiss,
Twombly, 550 U.S. at 555.
a
complaint
must
contain
sufficient facts “to ‘state a claim to relief that is plausible
on its face.’”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(quoting Twombly, 550 U.S. at 570).
“The 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. (quoting Twombly, 550 U.S. at 556).
“Threadbare recitals of
the elements of a cause of action, supported by mere conclusory
statements,
plaintiff
do
with
not
no
suffice.”
facts
and
Id.
“armed
(citation
with
omitted).
nothing
more
conclusions” cannot “unlock the doors of discovery.”
678-79.
To
survive
a
motion
to
dismiss,
a
A
than
Id. at
complaint
must
“contain either direct or inferential allegations respecting all
6
material elements necessary for recovery under a viable legal
theory.”
D’Ambrosio v. Marino, 747 F.3d 378, 383 (6th Cir.
2014) (quotation marks omitted).
IV.
Analysis
A.
Intentional Interference with Business Relationships
Defendants contend that Plaintiff has not adequately pled
each
element
business
of
its
claim
relationships
for
(the
intentional
interference
“intentional-interference
(ECF No. 33-1 at 95-96, ECF No. 35-1 at 120-21.)
disagrees.
To
business
with
claim”).
Plaintiff
(ECF No. 46 at 166-67.)
sustain
a
claim
relationships
for
under
intentional
Tennessee
law,
interference
a
with
plaintiff
must
prove the following elements:
(1) an existing business relationship with specific
third parties or a prospective relationship with an
identifiable
class
of
third
persons;
(2) the
defendant’s knowledge of that relationship and not a
mere awareness of the plaintiff’s business dealings
with others in general; (3) the defendant’s intent to
cause the breach or termination of the business
relationship; (4) the defendant’s improper motive or
improper means; and finally, (5) damages resulting
from the tortious interference.
Trau-Med of Am., Inc. v. Allstate Ins. Co., 71 S.W.3d 691, 701
(Tenn. 2002) (emphasis removed and citation omitted).
Plaintiff contends it has adequately alleged that it has a
prospective
relationship
with
an
identifiable
persons, satisfying the first element.
7
class
of
third
Plaintiff alleges that
it provides passenger-transportation services in Memphis and the
surrounding area to and from the airport and various hotels,
restaurants, and other businesses.
has
prospective
Memphis
and
business
the
Plaintiff alleges that it
relationships
surrounding
with
persons
in
desiring
passenger
(ECF No. 1 ¶ 31 at 8.)
transportation services.”
area
“all
Plaintiff
“acknowledges that this is a broad class of persons,” but argues
that “other courts have found . . . similar allegations to be
sufficient.”
(ECF No. 46 at 167.)
Plaintiff
Defendants
contends
have
that
it
knowledge
has
of
adequately
alleged
Plaintiff’s
relationships, satisfying the second element.
that
prospective
Plaintiff alleges
that it and Defendants provide the same service in the same
market and that Defendants are aware of their own prospective
business
relationships
and
passenger-transportation
argues
that,
based
on
of
other
companies’
services
in
that
those
facts,
it
provision
market.
is
a
of
Plaintiff
“reasonable
inference” that Defendants have the requisite knowledge.
(Id.
at 169.)
Assuming without deciding that Plaintiff’s allegations in
support of the first two elements are adequate, Plaintiff has
failed
to
relief
can
state
be
an
intentional-interference
granted
because,
as
claim
discussed
on
below,
which
its
allegations in support of the remaining elements are inadequate.
8
1.
“A
Defendants’ Improper Motive or Improper Means
showing
of
impropriety
intentional
interference
Patterson
Methodist
v.
is
essential
with
business
Healthcare-Memphis
in
a
case
for
relationships.”
Hosps.,
No.
W2008-
02614-COA-R3-CV, 2010 WL 363314, at *10 (Tenn. Ct. App. Feb. 2,
2010).
“[E]ither improper motive or improper means may support
liability for tortious interference.”
Watson’s Carpet & Floor
Coverings, Inc. v. McCormick, 247 S.W.3d 169, 184 (Tenn. Ct.
App.
2007).
To
prove
improper
motive,
a
plaintiff
must
demonstrate that “defendant’s predominant purpose was to injure
the plaintiff.”
Trau-Med, 71 S.W.3d at 701 n.5.
Improper means
include:
those
means
that
are
illegal
or
independently
tortious, such as violations of statutes, regulations,
or recognized common-law rules; violence, threats or
intimidation, bribery, unfounded litigation, fraud,
misrepresentation or deceit, defamation, duress, undue
influence,
misuse
of
inside
or
confidential
information, or breach of a fiduciary relationship;
and those methods that violate an established standard
of a trade or profession, or otherwise involve
unethical
conduct,
such
as
sharp
dealing,
overreaching, or unfair competition.
Id.
(citations
omitted).
In
some
instances,
engaging
in
commercial activity without a required permit may satisfy the
improper-means
element.
See
Tennison
Bros.
v.
Thomas,
No.
W2013-01835-COA-R3-CV, 2014 WL 3845122, at *13 (Tenn. Ct. App.
Aug. 6, 2014).
“[A] determination of whether a defendant acted
‘improperly’ or possessed an ‘improper’ motive is dependent on
9
the particular facts and circumstances of a given case.”
Trau-
Med, 71 S.W.3d at 701 n.5.
Plaintiff
means.
cited
contends
that
Defendants
(ECF No. 46 at 171-73.)
the
alleges
statutes
and
defendant[s]
(Id. at 172-73.)
used
improper
Plaintiff argues that it “has
ordinances
and/or
have
in
[their]
the
complaint
drivers
have
that
it
violated.”
The Complaint alleges that “defendants and/or
their drivers have failed and refused to comply with” sections
6-54-128, 7-51-1003, 7-51-1007, 55-4-112, 65-15-101, and 65-15110 of the Tennessee Code and sections 6-44-3, 6-44-4, 6-44-5,
6-44-6, 6-44-20, 6-44-21, and 6-44-22 of the City of Memphis
Code of Ordinances.
(ECF No. 1 ¶¶ 17-18, 21, 23, 34 at 4-6, 9.)
The only specific violating conduct alleged by the Complaint is
that “[n]o certificates of public convenience or permits have
been
issued
Memphis.”
to
or
their
drivers
by
the
City
of
(Id. ¶ 25 at 6; see ECF No. 46 at 173.)
Defendants
causation.
defendants
argue
that
Plaintiff
has
failed
to
allege
(ECF No. 33-1 at 107-082; see ECF No. 35-1 at 126.)
Lyft argues: “Plaintiff alleges no . . . causal link -- it does
not allege, for example, that the alleged ordinance violations
2
Lyft addresses causation under the damages element. (ECF No. 33-1 at 107.)
Some Tennessee courts have addressed causation under the damages element.
See, e.g., Springfield Invs., LLC v. Global Invs., LLC, No. E2014-01703-COAR3-CV, 2015 WL 5064090, at *17, *20 (Tenn. Ct. App. Aug. 27, 2015).
As
discussed below, other Tennessee courts address causation under the impropermotive-or-improper-means element.
10
cause customers to choose Lyft over Plaintiff’s company.”
No. 33-1 at 107-08.)
(ECF
Lyft argues that “Plaintiff alleges only
that Lyft competes with it, and that Lyft allegedly violates
local law while doing so.”
“[a]ny
harm
Plaintiff
(Id. at 108.)
suffers
Lyft contends that
results
only
from
competition, not from the alleged improper conduct.”3
Under
Tennessee
law,
a
defendant’s
lawful
(Id.)
improperly
motivated
conduct or improper means -- rather than the defendant’s lawful
competitive
suffers.
that
it
conduct
--
must
cause
the
harm
that
plaintiff
In Trau-Med, the Tennessee Supreme Court explained
had
intentional
previously
interference
declined
with
to
recognize
business
the
relationships
tort
of
because,
“as the tort was originally formulated, [that] claim . . . could
be actionable merely upon proof that a defendant’s intentional
acts resulted in a plaintiff’s economic injury.”
699.
71 S.W.3d at
Trau-Med reasoned that, “without any consideration of the
propriety
of
the
defendant’s
objective
or
motive,”
the
intentional-interference tort “could potentially infringe upon
the
principle
of
free
competition
3
by
holding
liable
those
The parties dispute whether the statutes and ordinances cited in the
Complaint
apply
to
transportation
network
companies,
whether
the
Transportation Network Company Services Act (the “Act”), Tenn. Code Ann.
§§ 65-15-301 et seq., has preempted otherwise applicable statutes and
ordinances regulating transportation network companies, and whether Plaintiff
has abandoned its claims based on Defendants’ conduct since the effective
date of the Act. It is not necessary to resolve those issues because, even
if Defendants were governed by and in violation of any of those authorities,
Plaintiff’s failure to plead causation adequately warrants dismissal of its
intentional-interference claim.
11
individuals
engaged
in
legitimate
business
practices.”
Id.
Trau-Med noted that, “[t]o address this concern, a majority of
jurisdictions
have . . . add[ed]
the
requirement
of
proof
of
improper conduct extending beyond the bounds of doing business
in a freely competitive society.”
Id. at 700.
In Watson’s, the court noted that Trau-Med had “cited with
approval
the
discussion
of
intentional
interference
with
prospective business relationships” in the Restatement (Second)
of Torts.
247 S.W.3d at 175.
Trau-Med quoted the Restatement
as follows:
One who intentionally and improperly interferes with
another’s prospective contractual relation (except a
contract to marry) is subject to liability to the
other for the pecuniary harm resulting from loss of
the benefits of the relation, whether the interference
consists of
(a)
(b)
71
inducing or otherwise causing a third person not
to enter into or continue
the prospective
relation or
preventing the other from acquiring or continuing
the prospective relation.
S.W.3d
at
700
n.2
(emphasis
added;
emphasis
in
Trau-Med
removed) (quoting Restatement (Second) of Torts § 766B (1979)).
The Restatement makes clear that the improper interference
made
actionable
by
the
intentional-interference
tort,
not
defendant’s competitive conduct generally, must be what causes
harm
to
plaintiff’s
third party.
prospective
business
relationship
with
a
One federal district court applying Tennessee law
12
has explained that “[c]ompeting with a business for customers is
all-American capitalism and is not the same as using improper
means to interfere with the relationship between that business
and its customers.”
Tenn. Walking Horse Breeders’ & Exhibitors
Ass’n v. Nat’l Walking Horse Ass’n, 528 F. Supp. 2d 772, 785
(M.D. Tenn. 2007) (“The Court finds . . . insufficient evidence
that
Defendant
used
improper
means
to
interfere
with
the
relationship between the Plaintiff and its membership.”).
The decisions Plaintiff cites illustrate that the alleged
impropriety
by
a
defendant,
not
the
defendant’s
lawful
competitive conduct, must cause the harm to plaintiff’s business
relationship.
In Tennison Bros., the Tennessee Court of Appeals
decided that plaintiffs had adequately pled improper motive or
improper
means
where
they
alleged
that
the
defendant
had
unlawfully erected an advertising billboard without a permit.
2014 WL 3845122, at *13.
In that case, plaintiff Clear Channel
Outdoor (“CCO”), a company, entered into a lease agreement with
plaintiff
Tennison
Brothers,
a
billboard on Tennison’s property.
second
company,
Id. at *1.
to
erect
a
Defendant Thomas
had entered into a lease agreement with the owner of an adjacent
property to erect a billboard on that parcel of land.
Id.
A
Tennessee law regulating the spacing of advertising structures
required neighboring structures on the same side of the highway
to be spaced at least 1,000 feet apart.
13
Id. at *1-2.
Because
CCO’s and Thomas’s proposed billboard locations were only 50
feet
apart,
CCO
and
Thomas
permits from the state.
submitted
separate
could
Id.
permit
not
both
receive
building
After both CCO and Thomas had
applications
to
the
Tennessee
Department of Transportation, CCO’s application was granted, but
Thomas’s was rejected.
Id. at *2.
Alleging that Thomas had proceeded to construct a billboard
illegally on the adjacent property without a permit, CCO and
Tennison sued Thomas for intentional interference with business
relationships.
Id. at *12-13.
Reversing the trial court’s
decision to the contrary, the Court of Appeals concluded that
CCO and Tennison had adequately alleged facts in support of the
fourth element of their intentional-interference claims:
[B]oth Tennison and CCO aver that Mr. Thomas illegally
constructed a billboard without a permit to prevent
the construction of a billboard by CCO on Tennison’s
property.
Under the definitions outlined in Trau–Med
and Watson’s, the allegation that Mr. Thomas illegally
constructed a billboard is sufficient to satisfy the
fourth criterion for this tort, i.e., that the
interfering party use improper motive or means. Here,
the improper means was Mr. Thomas’s construction of a
billboard without a permit, which prevented CCO from
building its billboard on Tennison’s property.
Id.
at
*13.
defendant’s
In
Tennison
improper
Bros.,
means
plaintiffs’
adequately
alleged
allegations
that
CCO
of
was
prevented from building its billboard as a result of defendant’s
illegal conduct.
CV-73,
2012
WL
See also PPG Indus., Inc. v. Payne, No. 3:101836314,
at
*6
14
(E.D.
Tenn.
May
21,
2012)
(“[Ledford’s] reasons for not doing business with Lee Payne and
Mil-Spec are not connected with any alleged improper means used
by PPG.”); Assist-2-Sell, Inc. v. Assist-2-Build, LLC, No. 1:05CV-193,
2005
WL
3333276,
at
*6
(E.D.
Tenn.
Dec.
6,
2005)
(“[Defendants’] taking of the signs and disruption of the open
house,
business
(noting
if
true,
could
have
relationship.”);
that
[defendant’s]
“[t]he
cf.
act
refusal
interfered
that
to
Watson’s,
caused
deal,
not
with
247
a
S.W.3d
[plaintiff]
any
prospective
other
at
178
damage
was
action
by
[defendant] such as defamation,” and finding that defendant’s
“refusal to deal [was] not improper”).
Although
drivers
Plaintiff
have
failed
alleges
to
that
obtain
Defendants
certificates
and
their
of
public
convenience, or permits, from the City of Memphis, Plaintiff has
not alleged that Defendants’ failure to do so is what has harmed
Plaintiff’s prospective business relationships with customers.
Unlike
the
construction
building
its
defendant
of
a
in
Tennison
billboard
billboard,
Bros.,
prevented
Plaintiff
the
has
not
whose
illegal
plaintiff
from
alleged
that
Defendants’ failure to obtain permits has prevented Plaintiff
from operating its fleet of vehicles.
WL 3845122, at *13.
See Tennison Bros., 2014
Plaintiff has not alleged that the reason
customers have not done business with Plaintiff is connected
with Defendants’ failure to obtain permits.
15
See PPG Indus.,
2012
WL
1836314,
at
*6.
Defendants’
failure
to
Plaintiff’s
prospective
Plaintiff
obtain
has
permits
relationships
not
has
somehow
with
Assist-2-Sell, 2005 WL 3333276, at *6.
alleged
targeted
customers.
See
Even were the Complaint
to make those allegations, they would need to be plausible.
Iqbal,
556
U.S.
at
678.
For
that
Plaintiff’s
See
intentional-
interference claim to be adequately pled, Defendants’ failure to
obtain
permits
must
be
the
means
of
interference,
Defendants’ competitive conduct generally.
not
See Tenn. Walking
Horse, 528 F. Supp. 2d at 785.
In the light most favorable to Plaintiff, its theory of
causation is that Defendants’ competitive business conduct is
tainted
because
Defendants
provide
passenger-transportation
services without acquiring necessary permits.
On this theory,
Plaintiff’s
attributable
losses
of
business
and
profit
to
Defendants’ competitive business conduct are nevertheless being
caused (albeit indirectly) by improper means.
The
based
on
Uber
Defendants
alleged
contend
violations
of
that
this
tainting
transportation
cannot sustain an intentional-interference claim.
at 127.)
tort
of
theory,
regulations,
(ECF No. 35-1
They argue that, “[i]f the law were otherwise, the
intentional
interference
with
business
relationships
would become an all-purpose tool for competitors to hijack the
government’s
enforcement
of
any
16
regulatory
scheme,
under
the
theory that their rivals were using ‘improper means’ by failing
to comply with the law.”
(Id.)
The Uber Defendants contend
that the “scope of the tort simply does not stretch that far.”
(Id.)
Plaintiff’s
asks
a
federal
ordinance.
intentional-interference
district
No
court
authority
to
cited
enforce
by
claim
effectively
indirectly
Plaintiff
a
supports
city
its
tainting theory of causation.
Although
violated
the
Complaint
numerous
other
alleges
statutes
that
and
Defendants
ordinances,
have
the
Uber
Defendants argue that Plaintiff has not alleged any facts in
support.
(ECF No. 35-1 at 127.)
The Uber Defendants contend
that “Plaintiff simply cites a list of statutes and makes broad,
conclusory allegations about the Uber Defendants’ compliance.”
(Id.)
Conclusory
allegations
that
Defendants
“failed
and
refused to comply with the statutes and ordinances” cited in the
Complaint (ECF No. 1 ¶ 23, 34 at 6, 9) do not satisfy the
federal pleading standard requiring a plaintiff to support a
claim
“by
showing
any
set
allegations in the complaint.”
of
facts
consistent
with
the
Twombly, 550 U.S. at 563.
The
federal pleading standard requires more than bare assertions of
legal conclusions.
to
tell
whether
Tackett, 561 F.3d at 488.
any
violations
by
It is impossible
Defendants
have
harmed
Plaintiff because Plaintiff does not allege facts showing what
those violations were.
17
Plaintiff
has
not
adequately
pled
Defendants’
improper
motive or improper means.
2.
To
Defendants’ Intent to Interfere
sustain
business
a
claim
relationships,
for
intentional
plaintiff
must
interference
also
prove
with
“the
defendant’s intent to cause the breach or termination of the
business relationship.”
Trau-Med, 71 S.W.3d at 701.
The Complaint alleges that “Defendants have and continue to
intend to cause breach of plaintiff’s prospective relations” in
that (a) “Plaintiff and defendants provide the same service to
the same market, and business gained by one party generally
means business lost by the other party”; (b) “Defendants desire
to
interfere
with
plaintiff’s
business
relations
and
take
business from plaintiff, or they know that the interference is
substantially certain to occur as a result of their actions”;
and
(c) “Defendants
know
and
intend
that
their
actions
will
result in a loss of business and income to the plaintiff.”
(ECF
No. 1 ¶ 33 at 8.)
Defendants contend that Plaintiff has failed to allege that
Defendants
intended
to
cause
breach
Plaintiff’s business relationships.
No.
35-1
at
123-24.)
Lyft
or
termination
of
(ECF No. 33-1 at 98-99; ECF
argues
that
the
intent
“element
cannot be satisfied by allegations that the defendant’s alleged
conduct
was
merely
intentional;
18
rather,
the
plaintiff
must
allege that the defendant actually intended to cause a breach of
the relationship at issue.”
Defendants
argue
intend
compete
to
that
in
(ECF No. 33-1 at 98.)
“simply
the
alleging
same
The Uber
that . . . Defendants
market
as
Plaintiff
is
not
sufficient to allege that . . . Defendants intended to interfere
with
Plaintiff’s
business
relationships.”
(ECF
No.
35-1
at
123.)
In Overnite Transportation Co. v. Teamsters Local Union No.
480,
the
Tennessee
Court
of
Appeals
considered
whether
a
Tennessee trial court had properly dismissed a plaintiff’s claim
for
intentional
interference
inadequately pled.
with
business
relationships
as
No. M2002-02116-COA-R3-CV, 2004 WL 383313,
at *11-13 (Tenn. Ct. App. Nov. 8, 2004).
Addressing whether
Overnite, the plaintiff company, had adequately pled the element
of intent in support of its claim, the Court of Appeals noted
that Overnite’s “complaint stated that ‘Defendants’ misconduct
was intentional and interfered with the employment relationship
between Overnite and its employees by adversely impacting the
safe
work
employees.’”
environment
Id. at *13.
that
Overnite
maintains
for
its
Overnite argued that its allegations
were “sufficient to show that the Union intentionally caused a
breach of a ‘business relationship.’”
rejected that argument, explaining:
19
Id.
The Court of Appeals
[T]he allegation that the Union’s
conduct ‘was
intentional’ does not satisfy the requirement of
alleging that the Union intended to cause a breach in
the business relationship at issue.
Rather, Overnite
must allege that the Union intentionally caused a
breach
in
Overnite’s
relationships.
This
the
complaint fails to do.
Id.;
see
also
Assist-2-Sell,
2005
WL
3333276,
at
*3
(“The
Overnite court reasoned the complaint failed to state a cause of
action
for
alleged
tortious
interference
intentional
business
conduct
relationship
intentionally
caused
that
instead
a
because
the
complaint
incidentally
of
alleging
breach
in
only
affected
the
Overnite’s
a
defendant
business
relationships.”).
Here,
the
Complaint’s
element are inadequate.
allegations
supporting
the
intent
The allegation that the parties compete
in the same market and “business gained by one party generally
means business lost by the other party” does not allege that
Defendants
Plaintiff’s
customers.
intentionally
caused
prospective
a
breach
business
or
termination
relationships
of
with
its
See Trau-Med, 71 S.W.3d at 701; Overnite, 2004 WL
383313, at *13.
in the market.
That is an allegation of ordinary competition
See Trau-Med, 71 S.W.3d at 699 (explaining that
the Tennessee Supreme Court had declined to recognize a version
of
the
proof
intentional-interference
that
plaintiff’s
a
defendant’s
economic
tort
“actionable
intentional
injury”).
An
20
acts
allegation
merely
resulted
of
upon
in
a
intentional
conduct that incidentally affects a business relationship is not
sufficient.
See Assist-2-Sell, 2005 WL 3333276, at *3.
The
remaining allegations of the Complaint that “Defendants desire
to
interfere
with
plaintiff’s
business
relations
and
take
business from plaintiff,” and that “Defendants know and intend
that their actions will result in a loss of business and income
to
the
plaintiff”
are
bare
Tackett, 561 F.3d at 488.
assertions
of
legal
conclusions.
“Threadbare recitals of the elements
of a cause of action, supported by mere conclusory statements,
do not suffice.”
Iqbal, 556 U.S. at 678 (citation omitted).
Plaintiff argues that, to the extent Overnite holds that
“just because a party engages in intentional conduct does not
equate
to
an
intent
application here.”
to
interfere,”
the
(ECF No. 46 at 170-71.)
decision
“has
no
Plaintiff contends
that Overnite was a case about existing business relationships,
but that this case is about prospective business relationships.
(Id. at 171.)
Plaintiff offers a distinction without a difference.
Trau-
Med held that, to prove an intentional-interference claim, a
plaintiff must prove a “defendant’s intent to cause the breach
or
termination
of
[plaintiff’s]
business
relationship”
regardless of whether that relationship is “an existing business
relationship
with
specific
third
parties
or
a
prospective
relationship with an identifiable class of third persons.”
21
71
S.W.3d at 701.
elements
of
an
distinguishing
relationships.
Sell,
after
Overnite quoted Trau-Med’s formulation of the
intentional-interference
between
existing
relationships
tort
and
See 2004 WL 383313, at *12-13.
quoting
the
Trau-Med
standard
without
prospective
In Assist-2-
and
discussing
Overnite, the court explained, “Unlike Overnite, [complainants’]
specifically
allege
B
&
SSC
and
Mr.
Everhart
interfered with their business relations.”
*3-4.
intentionally
2005 WL 3333276, at
Assist-2-Sell addressed prospective rather than existing
business
relationships.
Id.
at
*5-6.
Plaintiff
cites
no
authority that intentional conduct alone, rather than intent to
cause
a
breach
or
termination
of
plaintiff’s
business
relationships, suffices where prospective relationships are at
issue.
Plaintiff quotes the Restatement, which states that “[t]he
interference with the other’s prospective contractual relation
is intentional if the actor desires to bring it about or if he
knows that the interference is certain or substantially certain
to
occur
(quoting
as
a result
Restatement
of
his
action.”
(Second)
of
Torts
(ECF
No.
§ 766B,
46
at
cmt.
170
d).)
Plaintiff argues that the Complaint establishes that “defendants
know and intend that their actions will result in a loss of
business and income to the plaintiff” and Defendants “desire to
interfere with plaintiff’s business relations and take business
22
from
plaintiff,
or
they
know
that
the
interference
is
substantially certain to occur as a result of their actions.”
(Id.)
Putting
aside
the
conclusory
nature
of
Plaintiff’s
allegations, the allegations of intent are inadequate even under
the
Restatement
Plaintiff
quotes
standard.
provides
also be improper.”
d.
The
that
same
“[t]he
Restatement
comment
interference . . . must
Restatement (Second) of Torts § 766B, cmt.
It is not sufficient that Defendants intended, desired, or
knew
with
certainty
that
their
lawful
competitive
business
conduct would cause a loss of business and income to Plaintiff.
Rather, Plaintiff must allege that Defendants intended, desired,
or knew with certainty that their
improper
conduct -- their
failure to obtain permits or some other act of noncompliance -would
harm
Plaintiff.
Plaintiff
make
no
such
plausible
allegation.
Plaintiff
cause
the
has
not
breach
or
adequately
pled
termination
of
Defendants’
Plaintiff’s
intent
to
business
relationships.
3.
Damages
Although Plaintiff “need not allege specific damages at the
pleading stage” to plead the fifth element of its intentionalinterference
claim
adequately,
see
Assist-2-Sell,
2005
WL
3333276, at *7, to the extent courts have addressed causation
23
under the damages element, Plaintiff has not adequately pled
damages, see, e.g., Springfield Invs., LLC v. Global Invs., LLC,
No. E2014-01703-COA-R3-CV, 2015 WL 5064090, at *17, *20 (Tenn.
Ct. App. Aug. 27, 2015).
The
Complaint
allegations
fails
respecting
to
all
contain
material
“direct
or
elements
inferential
necessary
for
recovery” on Plaintiff’s intentional-interference claim, which
warrants dismissal of that claim.
383.
See D’Ambrosio, 747 F.3d at
Lyft’s Motion and Uber’s Motion are GRANTED on Plaintiff’s
intentional-interference claim.
B.
“Acting in Concert” and “Class Action” Claims
Defendants
concert
and
argue
“class
underlying tort.
that
Plaintiff’s
action”
fail
claims
because
for
both
acting
in
require
an
(ECF No. 33-1 at 108-09; ECF No. 35-1 at 128-
29 (citing Bryant v. McCord, No. 01A01-9801-CV-00046, 1999 WL
10085, at *13 (Tenn. Ct. App. Jan. 12, 1999) (establishing that
an underlying tortious act is a necessary condition of a claim
for
acting
in
concert).)
Plaintiff
does
not
disagree,
but
argues that its remaining claims should not be dismissed because
it “has alleged a plausible claim for intentional interference
with plaintiff’s prospective business relations.”
(ECF No. 46
at 177.)
Because Plaintiff’s remaining claims are derivative of its
intentional-interference
claim
24
and
that
claim
warrants
dismissal, Plaintiff’s remaining claims also warrant dismissal.
Lyft’s
Motion
and
Uber’s
Motion
are
GRANTED
on
Plaintiff’s
acting-in-concert and “class action” claims.
V.
Conclusion
For the foregoing reasons, Lyft’s Motion and Uber’s Motion
are
GRANTED.
Plaintiff’s
pending
motion
for
certification, filed on June 29, 2017, is DENIED as moot.
No. 72 at 293; ECF No. 73 at 296.)
class
(ECF
This action is DISMISSED.
So ordered this 30th day of June, 2017.
/s/_Samuel H. Mays, Jr._____
SAMUEL H. MAYS, JR.
UNITED STATES DISTRICT JUDGE
25
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