Global Cash Network, Inc. v. Worldpay, US, Inc.
| Decision Date | 07 December 2015 |
| Docket Number | Case No. 15 C 5210 |
| Parties | Global Cash Network, Inc., an Illinois Corporation, Plaintiff, v. Worldpay, US, Inc., a Georgia Corporation, f/k/a, RBS Worldpay, Inc., a Georgia Corporation, f/k/a Lynk Systems, Inc., a Georgia Corporation, Defendant. |
| Court | U.S. District Court — Northern District of Illinois |
Timothy M. Schaum, Robert S. Grabemann, Daspin & Aument LLP, Chicago, IL, for Plaintiff.
Brian E. Cohen, Stephen J. Siegel, Novack and Macey LLP, Chicago, IL, Edward P. Cadagin, Edward A. Marshall, Arnall Golden Gregory LLP, Atlanta, GA, for Defendants.
Milton I. Shadur
Worldpay, US, Inc. (“Worldpay”) has filed a Fed. R. Civ. P. (‘Rule ‘) 12(b)(6)
motion to dismiss portions of the Complaint brought against it by Global Cash Network, Inc. (“Global Cash”), and that motion has now been fully briefed by the parties and is accordingly ripe for decision. For the reasons that follow, the motion is granted.
Under Rule 12(b)(6)
a party may move for dismissal for the “failure to state a claim upon which relief can be granted.” Familiar Rule 12(b)(6) principles require the district court to accept as true all of Global Cash's well-pleaded factual allegations and view them in the light most favorable to it as the non-moving party (Lavalais v. Vill. of Melrose Park , 734 F.3d 629, 632 (7th Cir.2013)
). But “legal conclusions or conclusory allegations that merely recite a claim's elements” are not entitled to any presumption of truth (Munson v. Gaetz , 673 F.3d 630, 632 (7th Cir.2012) ).
In the past decade the Supreme Court made an important change in the evaluation of Rule 12(b)(6)
motions via what this Court regularly refers to as the “Twombly–Iqbal canon,” a usage drawn from Bell Atl. Corp. v. Twombly , 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), as more finely tuned in Erickson v. Pardus , 551 U.S. 89, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (per curiam), and Ashcroft v. Iqbal , 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ). That canon has introduced the concept of “plausibility” into the analysis, and in that respect our Court of Appeals has “interpreted Twombly and Iqbal to require the plaintiff to provid[e] some specific facts to support the legal claims asserted in the complaint” (McCauley v. City of Chicago , 671 F.3d 611, 616 (7th Cir.2011) (internal quotation marks omitted)). As McCauley went on to reconfirm, claimants “must give enough details about the subject-matter of the case to present a story that holds together” (id. ).
Because the focus of Rule 12(b)(6)
motions is on the pleadings, they “can be based only on the complaint itself, documents attached to the complaint, documents that are critical to the complaint and referred to in it, and information that is subject to proper judicial notice” (Geinosky v. City of Chicago , 675 F.3d 743, 745 n. 1 (7th Cir.2012) ). But a nonmovant has more flexibility, for it “may elaborate on [its] factual allegations so long as the new elaborations are consistent with the pleadings” (id. ). This opinion evaluates Worldpay's motion in accordance with those principles.
Global Cash is an Illinois corporation that offers ATM and credit card processing services to merchants throughout the United States (Complaint ¶¶ 1, 5).1 In 2003 Global Cash entered into a Customer Referral Agreement with Lynk, a predecessor to Worldpay, under which Global Cash was to receive compensation for referring customers to Lynk's credit card-processing service (Complaint ¶ 17). Five years later Global Cash entered into a similar Customer Referral Agreement with Lynk's successor (and Worldpay's immediate predecessor), RBS Worldpay (Complaint ¶ 18). Finally, in 2014 Global Cash entered into a Customer Referral Agreement with Worldpay (Complaint ¶ 19).2
In late 2013 or early 2014 Global Cash conducted an audit and found that Worldpay had been shortchanging the company on referral fees due under the agreements to the tune of $15,000 to $30,000 per month going back to at least 2004 (Complaint ¶ 21). Global Cash brought this problem to Worldpay's attention, but Worldpay was largely unresponsive except to acknowledge that there were certain payment shortfalls and to claim that an investigation was ongoing (Complaint ¶¶ 22-24). Global Cash then filed this lawsuit.
Though the Complaint is woefully short of details on this point, Global Cash asserts that is also a “customer” of Worldpay (Complaint ¶ 57) in that it “routed its own ATMs through Worldpay” (G. Resp. Mem. 3).3 Sometime in 2011 Global Cash employee Nicole Noelte (“Noelte”) communicated with Worldpay and requested that Global Cash's president Lisa McGarry (“McGarry”) be removed from a list of individuals who would receive notifications when settings were changed on a Global Cash ATM (Complaint ¶ 27). Worldpay complied with that request and, with McGarry thus in the dark, Noelte changed the settings on the ATM so that funds would be routed to her personal account rather than to her employer's (Complaint ¶¶ 25, 28-29). It was not until 2013, after Noelte had already embezzled roughly $700,000, that Global Cash learned of the scheme (Complaint ¶ 29; G. Resp. Mem. 3).
Worldpay seeks the total dismissal of five of the Complaint's six counts and a partial dismissal of the sixth, the Count I charge sounding in breach of contract, as to which Worldpay seeks dismissal only of contentions that it asserts are time-barred. This opinion will consider each count in turn.4
This Court's October 1, 2015 memorandum order (Dkt. No. 23), considered in tandem with Global Cash's responsive memorandum, makes disposition of Count I straightforward: Global Cash has conceded (G. Resp. Mem. 2) that the applicable statute of limitations for breach of contract claims is six years under Georgia law (see Ga. Code Ann. § 9-3-24
).5 Global Cash's remaining argument that the 2003 contract was executed under seal and is therefore subject to a twenty-year statute of limitations has already been addressed and rejected in the October 1 order. That then means that Global Cash has no enforceable right of recovery for breach of contract as to any conduct predating June 12, 2009, and Count I is dismissed to that extent.6
Global Cash's Count II, sounding in conversion, relies on the same set of facts that underpins Count I: the allegation that “Worldpay has wrongfully retained control of the payments that are due and owing to Global Cash...”(Complaint ¶ 38). That betrays a misunderstanding of the common law claim of conversion: Just as in Illinois, George law as stated in Taylor v. Powertel, Inc. , 250 Ga.App. 356, 551 S.E.2d 765, 769 (2001)
teaches:
Tangible personalty or specific intangible property may be the subject for an action for conversion, but as fungible intangible personal property, money, generally, is not subject to a civil action for trover with an election for damages for its conversion.7
Moreover, a claim of conversion “does not lie on account of a mere failure to pay money due under a contract” (Decatur Auto Ctr. v. Wachovia Bank, N.A. , 276 Ga. 817, 583 S.E.2d 6, 9 n.8 (2003)
(internal quotation marks omitted)). As the property allegedly converted here is indeed money due under a contract, Global Cash's conversion theory flunks that second test as well. Hence Count II is dismissed.8
In Count III Global Cash seeks an accounting to determine how much it is owed under the referral agreements. But Georgia law, as articulated in Gifford v. Jackson , 223 Ga. 155, 154 S.E.2d 224, 225 (1967)
(internal quotation marks omitted), makes it clear that:
Equity will not take cognizance of a plain legal right, where an adequate and complete remedy is provided by law.
Gifford, id.
went on to explain:
The mere necessity of an accounting to ascertain the amount due on a contract is wholly insufficient to give equity jurisdiction to order an accounting.
Here Global Cash seeks an accounting only to determine the amount due under its contracts with Worldpay (Complaint ¶ 47). While such an accounting is alleged to be “extremely complicated” (id. ), nothing in the Complaint—beyond conclusory allegations9 that cannot be credited—supports the notion that ordinary discovery on Global Cash's breach of contract claim would not suffice.
Appearing to recognize that infirmity, Global Cash has retreated from its demand for an accounting by suggesting that the count be “stayed” pending a review of Worldpay's business records (G. Resp. Mem. 3). Because no basis is advanced for doing so and no reason appears to support such a “stay,” Count III must be and is dismissed as well.
Global Cash has also retreated from its count sounding in unjust enrichment, which it acknowledges (G. Resp. Mem. 3) is defeated by the existence of valid contracts between the parties (see Reg'l Pacesetters, Inc. v. Halpern Enters., Inc. , 165 Ga.App. 777, 300 S.E.2d 180, 185 (1983)
). Although Global Cash instead requests that this Court dismiss the count without prejudice, there is no suggestion that additional facts could be pleaded to save that theory of recovery. Hence Count IV must be and is dismissed too.
Even when read in light of the forgiving standards of the federal system's notice pleading regime, Global Cash's negligence claim is extraordinarily vague. Global Cash has asserted that Worldpay's “wholly inadequate and negligent” security measures allowed Noelte to embezzle nearly $700,000 using a Global Cash ATM routed through Worldpay (Complaint ¶¶ 58-59; G. Resp. Mem. 6). But Global Cash has failed to explain even the most basic foundation for its negligence theory: the nature of the relationship between Global Cash and Worldpay that supposedly gave rise to Worldpay's asserted duty.10
Although Worldpay's memorandum assumed (understandably, given the...
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