Topsource Corporation v. The IBCS Group, Inc. et al
Filing
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MEMORANDUM OPINION. Signed by District Judge Michael F. Urbanski on 3/25/13. (kld)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF VIRGINIA
HARRISONBURG DIVISION
TOPSOURCE CORPORATION,
Plaintiff,
v.
THE IBCS GROUP, INC., et al.,
Defendants.
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Civil Action No. 5:12-cv-00078
By:
Michael F. Urbanski
United States District Judge
MEMORANDUM OPINION
Before the court is defendants’ renewed motion to dismiss (Dkt. # 18) plaintiff’s
complaint for failure to state a claim upon which relief may be granted. For the reasons stated
below, defendants’ motion must be GRANTED.
I.
This action brought pursuant to the Miller Act, 40 U.S.C. § 3131 et seq., involves a claim
on a payment bond issued by defendants. Plaintiff, TopSource Corporation (“TopSource”), filed
a warrant in debt in the Rockingham County General District Court on June 20, 2012, claiming
defendants, IBCS Group, Inc. and Edmund Scarborough, an individual surety, owe TopSource
the sum of $12,160 plus interest, costs, and attorney’s fees based on an “open account.”
Defendants removed this action to federal court, as this court has exclusive jurisdiction over civil
actions arising under the Miller Act, see 40 U.S.C. § 3133(b)(3), and thereafter filed a motion to
dismiss or, in the alternative, motion for a more definite statement, arguing plaintiff failed to
state any factual allegations to support its claim of an “open account.”
In response, TopSource filed a complaint1 alleging that in August 2009, the United States
Department of the Navy and Tommy Abbott and Associates, Inc. (“Abbott”), a general
contractor, entered into a contract for the construction of the Dam Neck Cottages in Virginia
Beach. TopSource asserts that, pursuant to the Miller Act, Abbott secured a payment bond,
executed by defendants, in support of the Dam Neck Project in the amount of $1,839,000.2
TopSource alleges that Abbott hired TopSource as a subcontractor and that TopSource
supplied Abbott with “materials, including vanities, sinks, tub surrounds, and related bath items,
and labor for the Project pursuant to an open credit account that Abbott had with [TopSource].”
Compl., Dkt. # 15, at ¶ 10. TopSource alleges that on January 11, 2011, pursuant to orders and
requests by Abbott under the open credit account, it shipped $10,074 worth of “various items and
goods” to Abbott, which were incorporated into the Dam Neck Project. Id. at ¶ 11. TopSource
alleges that on January 14, 2011, it shipped an additional $2,086 worth of “various items and
goods” to Abbott, which were incorporated into the Dam Neck Project. Id. at ¶ 12. TopSource
further alleges that Abbott “signed off on the plaintiff’s satisfactory completion of its work on
the Project,” id. at ¶ 14, referencing the Installation Check List attached as Exhibit 4 to the
complaint, which is dated January 18, 2011. This checklist confirms that all labor and
installation was “complete and satisfactory,” and states that TopSource employees did not need
to make any return trips to the Dam Neck Project. Compl., Dkt. # 15, at Ex. 4. TopSource
1
Defendants assert that the filing of this complaint satisfies Federal Rule of Civil Procedure 8(a) and moots
defendants’ request for a more definite statement. See Renewed Motion to Dismiss, Dkt. # 18, at 1. The complaint
also appears to moot defendants’ initial motion to dismiss under Rule 12(b)(6), which concerned TopSource’s
failure to state any factual allegations in the warrant in debt to support its claim of the existence of an “open
account” between the parties. As such, defendants’ motion to dismiss or, in the alternative, motion for a more
definite statement (Dkt. # 8) will be DENIED as moot.
2
TopSource attached a copy of the payment bond as an exhibit to its complaint, along with an invoice dated January
11, 2011, an invoice dated January 14, 2011, and an Installation Check List dated January 18, 2011. In considering
a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a court can “consider documents attached to the
complaint, see Fed. R. Civ. P. 10(c), as well as those attached to the motion to dismiss, so long as they are integral to
the complaint and authentic.” Philips v. Pitt County Mem’l Hosp., 572 F.3d 176, 180 (4th Cir. 2009) (citing
Blankenship v. Manchin, 471 F.3d 523, 526 n.1 (4th Cir. 2006)).
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claims that Abbott owes $12,160 for the goods, materials and labor it supplied under its open
account and that, despite demand, TopSource has not received payment for the materials.
TopSource therefore asserts a claim against defendants3 under the payment bond in the amount
of $12,160 plus interest and costs.
Defendants have filed a renewed motion to dismiss the complaint (Dkt. # 18), in which
they argue TopSource’s claim is barred by the Miller Act’s one-year statute of limitations.
TopSource has not filed a response to the renewed motion to dismiss.4
II.
To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a
complaint must contain sufficient factual matter which, accepted as true, “state[s] a claim to
relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). This plausibility standard requires a plaintiff
to demonstrate more than “a sheer possibility that a defendant has acted unlawfully.” Id. When
ruling on a motion to dismiss, the court must “accept the well-pled allegations of the complaint
as true” and “construe the facts and reasonable inferences derived therefrom in the light most
favorable to the plaintiff.” Ibarra v. United States, 120 F.3d 472, 474 (4th Cir. 1997). While the
court must accept as true all well-pleaded factual allegations, the same is not true for 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. Determining whether a
complaint states a plausible claim for relief is “a context-specific task that requires the reviewing
court to draw on its judicial experience and common sense.” Id. at 679.
3
TopSource alleges that Abbott has filed for bankruptcy. Compl., Dkt. # 15, at ¶ 17.
Although TopSource filed a response in opposition to defendants’ initial motion to dismiss or, in the alternative,
motion for a more definite statement, this motion did not concern the statute of limitations issue presently before the
court.
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“Although a motion pursuant to Rule 12(b)(6) invites an inquiry into the legal sufficiency
of the complaint, not an analysis of potential defenses to the claims set forth therein, dismissal
nevertheless is appropriate when the face of the complaint clearly reveals the existence of a
meritorious affirmative defense.” Brooks v. City of Winston-Salem, 85 F.3d 178, 181 (4th Cir.
1996) (citing Richmond, Fredericksburg & Potomac R. Co. v. Forst, 4 F.3d 244, 250 (4th Cir.
1993)). “A complaint showing that the governing statute of limitations has run on the plaintiff’s
claim for relief is the most common situation in which the affirmative defense appears on the
face of the pleading and provides a basis for a motion to dismiss under Rule 12(b)(6). . . .” 5B
Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 1357 (3d ed. 2004);
accord Brooks, 85 F.3d at 181. Indeed, courts have held that the one-year statute of limitations
found in the Miller Act is an affirmative defense properly analyzed under Rule 12(b)(6). See,
e.g., Highland Renovation Corp. v. Hanover Ins. Group, 620 F. Supp. 2d 79, 82 (D.D.C. 2009).
III.
The Miller Act is designed “to protect persons supplying labor and material for the
construction of federal public buildings in lieu of the protection they might receive under state
statutes with respect to the construction of nonfederal buildings.” United States ex rel. Sherman
v. Carter, 353 U.S. 210, 216 (1957). The Miller Act requires general contractors awarded a
contract in an amount greater than $100,000 by the federal government for “the construction,
alteration, or repair of any public building” to obtain a payment bond for the “protection of all
persons supplying labor and material in carrying out the work provided for in the contract . . . .”
40 U.S.C. § 3131(b)(2). A person who has furnished labor or materials in carrying out work
provided for in a contract for which a payment bond is furnished under § 3131, who has not been
paid within ninety days “after the day on which the person did or performed the last of the labor
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or furnished or supplied the material for which the claim is made,” can bring a civil action on the
bond for the amount unpaid. Id. at § 3133(b)(1). Such an action must be brought “no later than
one year after the day on which the last of the labor was performed or material was supplied by
the person bringing the action.” Id. at § 3133(b)(4).
TopSource alleges in its complaint that it supplied materials to Abbott for use in the Dam
Neck Project on January 11 and 14, 2011, and the invoices attached to the complaint support that
contention. Compl., Dkt. # 15, at ¶¶ 11, 12; Ex. 2, 3. An Installation Check List dated January
18, 2011 is also attached to the complaint and contains signatures from representatives of both
the contractor and TopSource. The Installation Check List indicates that all items have been
completed to both parties’ satisfaction and “no return trip is necessary.” Id. at Ex. 4. Based on
TopSource’s allegations, the last of the labor performed or materials supplied by TopSource
occurred in January 2011.5 TopSource did not assert a claim on the payment bond, however,
until it filed its warrant in debt in the Rockingham County General District Court on June 20,
2012. It subsequently filed a complaint in federal court on November 9, 2012, after the case had
been removed. At best, TopSource asserted its claim seventeen months after it last performed
labor or supplied materials for the Dam Neck Project. TopSource’s claim is therefore timebarred by the Miller Act’s one year statute of limitations.
As such, defendants’ renewed motion to dismiss (Dkt. # 18) will be GRANTED. An
appropriate Order will be entered.
Entered: March 25, 2013
/s/ Michael F. Urbanski
Michael F. Urbanski
United States District Judge
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TopSource does not present anything to show that the doctrines of waiver, estoppel or equitable tolling should
apply in this case.
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