An Ill. Corp.. v. Cannon Auto. Ltd.

• Decision Date: 25 May 2010
• Docket Number: No. 08 C 139.,08 C 139.
• Citation: 715 F.Supp.2d 786
• Parties: MacNEIL AUTOMOTIVE PRODUCTS, LIMITED, an Illinois Corporation, Plaintiff, v. CANNON AUTOMOTIVE LIMITED, f/k/a Cannon Rubber Limited, Automotive Division, a United Kingdom Company, Defendant.
• Court: U.S. District Court — Northern District of Illinois

715 F.Supp.2d 786

MacNEIL AUTOMOTIVE PRODUCTS, LIMITED, an Illinois Corporation, Plaintiff,

v.CANNON AUTOMOTIVE LIMITED, f/k/a Cannon Rubber Limited, Automotive Division, a United Kingdom Company, Defendant.

No. 08 C 139.

United States District Court,

N.D. Illinois,

Eastern Division.

May 25, 2010.

Robert S. Grabemann, Timothy M. Schaum, Daspin & Aument, Chicago, IL, for Plaintiff.

Adam Oyebanji, James Robert Vogler, Sandra Louise Vasher, Barack Ferrazano Kirschbaum & Nagelberg LLP, Chicago, IL, for Defendant.

MEMORANDUM OPINION & ORDER

JOAN B. GOTTSCHALL, District Judge.

This case arises from defendant Cannon Automotive Limited's (“Cannon”) supply of allegedly defective automobile floor mats to MacNeil Automotive Products, Limited (“MacNeil”), which contracted to supply those mats to automakers Hyundai and BMW. According to MacNeil, Cannon supplied floor mats in which the carpet portion and the rubber portion of the mats did not properly adhere. MacNeil asserts eight causes of action, including breach of contract, breach of warranties, consumer fraud, and conversion. This case is presently before the court on two matters. The first matter is Cannon's motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) or, alternatively, for a more definite statement. ¹ Second, the court considers the magistrate judge's report and recommendation denying Cannon's motion to dismiss for MacNeil's alleged spoliation of evidence.

I. Legal Standard

Federal Rule of Civil Procedure 12(b)(6) allows a defendant to seek dismissal of a complaint that fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). In deciding a Rule 12(b)(6) motion, the court must “construe the complaint in the light most favorable to the plaintiff, accepting as true all well-pleaded facts alleged, and drawing all possible inferences in [the plaintiff's] favor.” Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir.2008). Legal conclusions, however, are not entitled to any assumption of truth. Ashcroft v. Iqbal, 556 U.S. ----, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). A plaintiff generally need not plead particularized facts; Federal Rule of Civil Procedure 8(a)(2) requires that the complaint set forth only “a short and plain statement of the claim showing that the pleader is entitled to relief....” Fed.R.Civ.P. 8(a)(2). Still, the factual allegations in the complaint must be sufficient to “state a claim to relief that is plausible on its face....” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007).

The Seventh Circuit has summarized the requirements of Twombly, Iqbal, and other recent precedent as follows:

First, a plaintiff must provide notice to defendants of her claims. Second, courts must accept a plaintiff's factual allegations as true, but some factual allegations will be so sketchy or implausible that they fail to provide sufficient notice to defendants of the plaintiff's claim. Third, in considering the plaintiff's factual allegations, courts should not accept as adequate abstract recitations of the elements of a cause of action or conclusory legal statements.

Brooks v. Ross, 578 F.3d 574, 581 (7th Cir.2009). As the Seventh Circuit has recently reiterated, a Rule 12(b)(6) motion generally cannot be based on matters outside the complaint; instead, the court can construe such a motion as one for summary judgment. See Miller v. Herman, 600 F.3d 726, 733 (7th Cir.2010).

In addition to moving pursuant to Rule 12(b)(6), Cannon alternatively seeks a more definite statement regarding certain matters. Rule 12(e) states, “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). “Motions for a more definite statement should not be used to gain additional information, but, particularly in light of our liberal notice pleading requirement, should be granted only when the pleading is so unintelligible that the movant cannot draft a responsive pleading.” Kingsbury Int'l, Ltd. v. Trade The News, Inc., No. 08 C 3110, 2008 WL 4853615, at *2 (N.D.Ill. Oct. 28, 2008) (citations and internal quotation marks omitted).

II. Analysis

Cannon seeks dismissal of each of the eight counts of MacNeil's complaint.

A. Breach of Contract

Cannon seeks dismissal of Count I, MacNeil's breach of contract claim. Specifically, Cannon asserts that MacNeil's allegations are skeletal and muddied with legal conclusions and therefore fail to provide sufficient notice to defendant of MacNeil's claims.

This argument is meritless. MacNeil alleges that it and Cannon entered into two contracts by which Cannon agreed to supply floor mats to MacNeil so that MacNeil could supply those floor mats to Hyundai and BMW, and that Cannon breached the contracts by delivering defective floor mats and by failing to deliver adequate floor mats on a timely basis. (Compl. ¶¶ 7-9, 39, 41.) MacNeil further alleges: when the parties entered into the oral contracts at issue; in what way the supplied floor mats were defective; and which Cannon representatives dealt with MacNeil. While Cannon lists a litany of questions that are not answered by the complaint, notice pleading does not require in-depth factual detail. MacNeil's allegations are sufficient to put Cannon on notice of the claim. For the same reasons, Cannon's alternative motion for a more definite statement is denied; MacNeil's Count I is not so “vague or ambiguous that [Cannon] cannot reasonably be required to frame a responsive pleading.” Fed.R.Civ.P. 12(e).

Cannon next argues that MacNeil has pled itself out of court by conceding that it has not paid for some floor mats, see id. ¶¶ 48, 49, which is inconsistent with MacNeil's earlier allegation that it fulfilled all terms of the contract, as required under Illinois law. See Indus. Hard Chrome, Ltd. v. Hetran, Inc., 64 F.Supp.2d 741, 745 (N.D.Ill.1999). ² In briefing, MacNeil maintains that its allegations regarding nonpayment to Cannon pertain to a different set of floor mats, which were supplied by Cannon after the floor mats at issue in MacNeil's breach of contract claim. MacNeil may be correct, but its complaint does not adequately differentiate between the different sets of floor mats it describes in its briefs. Because this issue may be clarified on re-pleading, Count I is dismissed without prejudice.

B. Declaratory Judgment

In Count II, MacNeil requests a declaratory judgment that it is not obligated to pay Cannon for certain outstanding invoices related to Cannon's supply of floor mats. MacNeil alleges that “a dispute exists regarding whether MacNeil is obligated to pay Cannon for certain outstanding invoices relating to Cannon's supply to MacNeil of floor mats ....” (Compl. ¶ 48.) Cannon seeks dismissal on the ground that no case or controversy exists on which to base this claim. Specifically, Cannon claims that this issue was already litigated before a court in the United Kingdom, which entered a default judgment against MacNeil; Cannon attaches a copy of the British judgment to its motion. MacNeil does not dispute that the issue was already litigated in the United Kingdom, but rather argues that it need not pay the amount of the British judgment because it is entitled to set off any amounts that Cannon owes it against the amount of the judgment entered by the British court.

Cannon's motion relies on matters outside the complaint, namely, the foreign judgment. Such reliance is generally improper on a motion to dismiss pursuant to Rule 12(b)(6). See Miller, 600 F.3d at 733. However, an exception to the general rule allows the court to consider public records, including foreign judgments, in the context of a Rule 12(b)(6) motion. Henson v. CSC Credit Servs., 29 F.3d 280, 284 (7th Cir.1994); see also Gabbanelli Accordions & Imports, L.L.C. v. Ditta Gabbanelli Ubaldo Di Elio Gabbanelli, 575 F.3d 693, 696 (7th Cir.2009) (stating that judicial notice of a foreign judgment is permissible). Even so, Cannon's motion fails because Cannon fails to analyze the applicability of the “case or controversy” requirement to the facts of this case.

For a case or controversy to exist, the matter before the court must be susceptible to an order “of specific relief ... of a conclusive character....” Preiser v. Newkirk, 422 U.S. 395, 401, 95 S.Ct. 2330, 45 L.Ed.2d 272 (1975) (internal citations and quotation marks omitted). Cannon does not discuss this standard or explain why an order providing that MacNeil does not owe the amounts under the invoices due to the setoff (or, for that matter, a determination that MacNeil does owe those amounts) would not provide specific, conclusive relief. The parties' filings in this case make clear that, as a practical matter, there is a very real controversy between MacNeil and Cannon regarding whether MacNeil is obligated to pay Cannon based on the foreign judgment, given that MacNeil contends it is entitled to set off amounts Cannon owes to it against any payments it owes to Cannon. Moreover, it does not appear that the setoff issue has been litigated either in the British court or in the Circuit Court of DuPage County, where Cannon registered the foreign judgment. The court denies Cannon's motion to dismiss with respect to Count II.

C. Promissory Estoppel

In Count III, MacNeil brings a claim against Cannon for promissory estoppel. Cannon moves for dismissal of Count III on the ground that MacNeil's promissory estoppel and contract claims cannot coexist. MacNeil incorporates its breach of contract allegations, which include the allegation that valid contracts exist between the parties, see Compl. ¶ 39, into its promissory estoppel claim. ( Id. ¶ 52.) However, a promissory estoppel claim is premised on the non-existence of a contract. See All-Tech Telecomm., Inc. v. Amway Corp., 174 F.3d 862, 869 (7th Cir.1999). MacNeil offers to...