C & K Trucking LLC et al v. Ardent Mills LLC
Filing
48
MEMORANDUM OPINION AND ORDER - Before the Court are Defendant Ardent Mills LLC's Motion to Dismiss Promissory Estoppel Claim in Plaintiff's First Amended Complaint (Doc. No. 32) and Memorandum of Law in Support of the Motion to Dismiss P romissory Estoppel Claim in Plaintiff's First Amended Complaint (Doc. No. 33) (collectively, the "Motion"). After careful consideration of the Motion, response, reply, relevant portions of the record, and applicable law, the Court GRANTS the Motion and DISMISSES the promissory estoppel claim. (Ordered by Judge Ed Kinkeade on 7/9/2021) (chmb)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
C & K TRUCKING, LLC et al.,
Plaintiffs,
v.
ARDENT MILLS LLC,
Defendant.
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Civil Action No. 3:20-CV-1104-K
MEMORANDUM OPINION AND ORDER
Before the Court are Defendant Ardent Mills LLC’s Motion to Dismiss
Promissory Estoppel Claim in Plaintiff’s First Amended Complaint (Doc. No. 32) and
Memorandum of Law in Support of the Motion to Dismiss Promissory Estoppel Claim
in Plaintiff’s First Amended Complaint (Doc. No. 33) (collectively, the “Motion”).
After careful consideration of the Motion, response, reply, relevant portions of the
record, and applicable law, the Court GRANTS the Motion and DISMISSES the
promissory estoppel claim.
I. Factual and Procedural Background
Plaintiff C & K Trucking, LLC (“Plaintiff” or “C & K Trucking”) is a trucking
company that was hired to transport goods for Defendant Ardent Mills (“Defendant”).
Defendant and Plaintiff entered into a Motor Transportation Agreement (the
“Agreement”) that retained Plaintiff for trucking services on an indefinite basis until
the Agreement was terminated by either party with a 60-day notice. Defendant
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allegedly promised a long-term placement with increased routes to C & K Trucking at
Defendant’s Sherman facility. Plaintiff contends Defendant represented that Plaintiff
would have almost all the trucking business out of Defendant’s Sherman facility.
Plaintiff argues that it relied on Defendant’s representations and purchased four trailers
and one truck, hired additional employees and contractors, and bought commercial
property adjacent to the Sherman facility to store its trucking fleet. Just nine months
after these alleged promises, Defendant terminated the Agreement and seized doing
business with Plaintiff.
The Original Complaint was filed on May 1, 2020, by plaintiffs C & K Trucking
and Kenyon Collins (“Collins”), the owner of C & K Trucking. Plaintiffs allege
Defendant breached the Agreement, breached alleged promises made to C & K
Trucking, racially discriminated against, defamed, and interfered with existing and
prospective business relations of C & K Trucking, and defamed Collins. Defendant
filed its Motion to Dismiss and Memorandum of Law in Support (the “First Motion to
Dismiss”) (Doc. Nos. 10 & 11) on June 17, 2020, asking the Court to dismiss all claims
in the Original Complaint under Federal Rule of Civil Procedure 12(b)(6). On January
20, 2021, this Court entered its Memorandum Opinion and Order (Doc. No. 30),
granting in part and denying in part Defendant’s First Motion to Dismiss. The Court
granted the First Motion to Dismiss the promissory estoppel claim and tortious
interference with existing and prospective business relations claims, but also granted
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Plaintiffs leave to file an amended complaint. The parties filed a Stipulated Dismissal
of Defamation Claims, leaving C & K Trucking as the only remaining plaintiff.
Plaintiff C & K Trucking filed the First Amended Complaint (Doc. No. 31), on
February 1, 2021, realleging the promissory estoppel and tortious interference with
existing business relations claims. With respect to the promissory estoppel claim,
Plaintiff amended its allegations to assert that Defendant’s alleged promises regarding
the Sherman facility business were independent and outside of the Agreement between
the parties.
Defendant filed the present Motion, seeking dismissal of the promissory
estoppel claim under Federal Rule of Civil Procedure 12(b)(6). The responsive briefing
is complete, and the Motion is ripe for review. Because the present Motion only
concerns the promissory estoppel claim, the Court will not address the facts
surrounding the other claims in this order.
II. Applicable Law
In considering a Rule 12(b)(6) motion, a court must determine whether the
plaintiff has sufficiently stated a claim upon which relief may be granted. FED. R. CIV.
P. 12(b)(6). A well-pleaded complaint must allege facts upon which the claims are
based and not be a conclusory recitation of the elements of a cause of action. Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 555 (2007). A complaint must state sufficient facts
such that the “claim has facial plausibility” and is not merely “possible.” Aschcroft v.
Iqbal, 556 U.S. 662, 678 (2009). A plaintiff pleads a claim with facial plausibility when
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the “factual content . . . allows the court to draw the reasonable inference that the
defendant is liable.” Id. This pleading standard does not require “‘detailed factual
allegations,’ but it demands more than an unadorned [] accusation . . . that is devoid
of ‘further factual’” support. Iqbal, 556 U.S. at 662 (quoting Twombly, 550 U.S. at
555). The complaint must allege sufficient facts to “give the defendant fair notice” of
plaintiff’s claims against the defendant. Twombly, 550 U.S. at 555 (quoting Conley v.
Gibson, 355 U.S. 41, 47 (1957)). The alleged facts must be facially plausible such that
the facts nudge the plaintiff’s claims “across the line from conceivable to
plausible.” Id. at 570.
The Court “accept[s] all well-pleaded facts as true and view[s] those facts in the
light most favorable to the plaintiff.” Stokes v. Gann, 498 F.3d 483, 484 (5th Cir.
2007) (per curiam). The Court “do[es] not accept as true conclusory allegations,
unwarranted factual inferences, or legal conclusions.” Ferrer v. Chevron Corp., 484 F.3d
776, 780 (5th Cir. 2007) (quoting Plotkin v. IP Axess Inc., 407 F.3d 690, 696 (5th Cir.
2005)).
The Court must generally determine a motion to dismiss for failure to state a
claim based solely on the pleadings, including any attachments thereto. Collins v.
Morgan Stanley Dean Witter, 224 F.3d 496, 498 (5th Cir. 2000). The Fifth Circuit also
allows the district court to consider documents attached to the motion to dismiss when
those documents “are referred to in the plaintiff’s complaint and are central to [the
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plaintiff’s] claim.” Id. at 498–99 (quoting Venture Assocs. Corp. v. Zenith Data Sys. Corp.,
987 F.2d 429, 431 (7th Cir. 1993)).
III. Analysis
In the Motion, Defendant seeks to dismiss the promissory estoppel claim.
Taking the allegations in the First Amended Complaint as true, the Court finds that
Plaintiff fails to state a claim for promissory estoppel as a matter of law because the
alleged promises made by Defendant to Plaintiff fall squarely within the parties’
Agreement and when alleged promises fall under an existing agreement, promissory
estoppel claims fail as a matter of law. Because Plaintiff cannot, as a matter of law, state
a claim for promissory estoppel given that the alleged promises fall under the parties’
existing Agreement, the Court GRANTS the Motion and DISMISSES the promissory
estoppel claim.
To establish promissory estoppel under Texas law, a plaintiff must establish: (1)
a promise; (2) foreseeability of reliance on the promise by the promisor; and (3)
substantial detrimental reliance by the promisee. See Metropolitan Life Ins. Co. v. Haden
& Co., 158 F.3d 584, 584 (5th Cir. 1998) (citing English v. Fischer, 660 S.W.2d 521,
524 (Tex. 1983)). While promissory estoppel and breach of contract are mutually
exclusive causes of action, a plaintiff can allege inconsistent theories so long as each
claim
is
individually
sufficient.
See
FED.
R.
CIV.
P.
8(a)(3),
(d)(2).
Promissory estoppel is not available where there is a legally valid contract between the
parties. Jhaver v. Zapata OffShore Co., 903 F.2d 381, 385 n.11 (5th Cir. 1990).
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“[P]romissory estoppel becomes available to a claimant only in the absence of a valid
and enforceable contract.” Williams v. Colonial Bank, N.A., 199 F. App’x 399, 403 (5th
Cir. 2006) (per curiam) (citing Doctors Hosp.1997, L.P. v. Sambuca Houston, L.P., 154
S.W.3d 634, 636 (Tex. App.—Houston [14th Dist.] 2004, pet. abated)). When an
agreement between the parties exists, the plaintiff must allege the promissory estoppel
claim rests on promises independent of the parties’ agreement. Id.
Defendant contends that Plaintiff has no separate cause of action for promissory
estoppel because the alleged promises fall under the parties’ Agreement and are not
independent of the Agreement. In addition, Defendant asserts that Plaintiff’s
allegations about the supposed promises are threadbare recitals of the elements of
promissory estoppel and noting more than conclusory statements that cannot survive
a motion to dismiss. Defendant also argues that the facts demonstrate there is not and
cannot be reasonable and substantial reliance upon the alleged promises because the
Agreement does not guarantee routes or compensation, so any reliance on promises or
alleged guarantees of routes in the future is unreasonable. Defendant points out that
Section 20 of the Agreement prohibits subsequent modifications “except by a writing
executed by both parties” and the alleged promises were not executed in a writing. Doc.
No. 34, Ex. A § 20. Defendant also asserts that the promissory estoppel claim should
be dismissed because the alleged promises are unenforceable under the statutes of
frauds because agreements must be in writing and signed if the terms cannot be
completed within one year.
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Plaintiff contends that Defendant made promises to Plaintiff about long-term
business at the Sherman facility after the execution of the Agreement that were outside
of and not incorporated in the Agreement. According to the First Amended Complaint,
Defendant allegedly promised to engage Plaintiff to run virtually all the delivery routes
from Defendant’s Sherman facility. First Am. Compl. ¶ 23. Plaintiff allegedly asked
Defendant if this would be a long-term placement because Plaintiff would need to
invest resources to accommodate the increase in routes. Id. Defendant supposedly
promised that Plaintiff “could plan on doing 90% of the loads, if not more, every week”
out of Defendant’s Sherman facility. Id. ¶ 24. Plaintiff previously ran only 20% of the
routes at that facility. Id. Plaintiff alleges Defendant represented it was not looking for
or planning to retain any other truckers for the Sherman facility. Id. Plaintiff argues
that in reliance and “[b]ased on these promises by [Defendant], C & K Trucking
purchased four additional trailers, one additional truck, and hired additional employees
and contractors to run these increased loads . . . [and also] purchased commercial
property directly adjacent to [Defendant’s] Sherman facility . . . for its trucking fleet.”
Id. Defendant terminated the contract nine months later. Id. ¶ 25. Plaintiff contends
that Defendant made Plaintiff believe it would be a long-term partner but quickly
found a replacement and phased Plaintiff out. Id. ¶ 24.
In response to Defendant’s Motion, Plaintiff unconvincingly argues that these
alleged promises are independent of the Agreement. The Court finds that Plaintiff’s
pleadings that the alleged promises are independent of the Agreement are conclusory
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at best because does nothing more than state in a cursory fashion that “Ardent Mills
made promises to C & K Trucking that came after the parties’ execution of the
Agreement and were outside of and not incorporated or merged into the parties’
Agreement”. First Am. Compl. ¶ 44. This barebone assertion that the alleged promises
are independent of the Agreement, even with the factual allegations surrounding the
alleged promises, fails to meet the federal pleading standard. Iqbal, 556 U.S. at 678-79
(explaining that the court is not bound to accept legal conclusions as true, and only a
complaint that states a plausible claim for relief survives a motion to dismiss).
As Defendant explains and in light of the Court’s review of the Agreement and
the First Amended Complaint, the Court finds that the alleged promises are not
independent, but instead fall under the Agreement. The Agreement clearly retained
Plaintiff’s trucking services on an indefinite basis until either party terminates the
Agreement. A long-term placement to handle the trucking loads at Defendant’s
Sherman facility certainly falls under this Agreement and is not an independent
promise. Plaintiff does not plead that the Agreement is invalid, and the alleged promises
concern the exact services contemplated and controlled by the Agreement. Given that
the alleged promises of longevity and exclusivity of business at the Sherman facility
concern the services performed under the Agreement, it cannot be said that Plaintiff
reasonably and substantially relied on promises independent from the Agreement when
it made the above-mentioned investments to accommodate the Sherman facility
business. The Agreement even sets out that it can only be modified or amended in a
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writing executed by the parties. There being no written modification to the Agreement
with respect to the alleged promises, it is not reasonable to rely on representations of
alleged guarantees of future routes when the Agreement is express as to valid
modification procedures. Plaintiff asserts that oral modifications of an agreement are
permitted when the agreement itself is not required to be in writing. However, even if
there was a valid modification to the Agreement based on the alleged promises, it does
not change the fact that there is a valid Agreement between the parties and therefore
the promissory estoppel claim must fail because such claim only “becomes available in
the absence of a valid and enforceable contract.” Williams, 199 F. App’x at 403
(citing Doctors Hosp.1997, 154 S.W.3d at 636).
Defendant also argues, in the alternative, that even if the alleged promises are
independent of the Agreement, the Texas statute of frauds bars the promissory estoppel
claim. See Doc. No. 33 at 12-15; See TEX. BUS. & COMM. CODE § 26.01 (Under Texas’s
statute of frauds, when an agreement cannot by its terms be completed in one year, it
must be written and signed to be enforceable.) Because the Court finds that the alleged
promises fall within the scope of the Agreement and therefore the promissory estoppel
claim fails as a matter of law, the Court need not address Defendant’s arguments that
the Texas statute of frauds bars enforcement of the alleged promises to justify its reason
for dismissing the promissory estoppel claim.
Because the alleged promises fall under the Agreement, Plaintiff’s promissory
estoppel claim fails as a matter of law in accordance with binding precedent. Id.
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Therefore, the Court finds that Plaintiff fails to state a claim for promissory estoppel
under the given facts, grants the Motion, and dismisses the promissory estoppel claim.
V. Conclusion
Because the alleged promises fall within the scope of the parties’ valid Agreement
making the promissory estoppel claim fail as a matter of law, the Court GRANTS
Defendant’s Motion to Dismiss Promissory Estoppel Claim in Plaintiff’s First
Amended Complaint and DISMISSES the promissory estoppel claim for failure to
state a claim upon which relief can be granted. See FED. R. OF CIV. P. 12(b)(6).
SO ORDERED.
Signed on July 9th, 2021.
______________________________________
ED KINKEADE
UNITED STATES DISTRICT JUDGE
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