Havtech, LLC v. Aaon, Inc.
| Decision Date | 17 January 2023 |
| Docket Number | CIVIL SAG-22-00453 |
| Parties | HAVTECH, LLC, et al., Plaintiffs, v. AAON INC., et al., Defendants. |
| Court | U.S. District Court — District of Maryland |
After an initial version of their complaint was dismissed Plaintiffs Havtech, LLC and Havtech Parts Division, LLC (collectively, “Havtech”) filed a First Amended Complaint (“FAC”) against AAON, Inc. and AAON Coil Products, Inc. (collectively, “AAON”) asserting violations of Oklahoma's Fair Practices of Equipment Manufacturers, Distributors, Wholesalers and Dealers Act (“OEDA”). ECF 50. AAON has again responded with a Motion to Dismiss the FAC (“the Motion”), ECF 49. The issues have been fully briefed ECF 53, 59, and no hearing is necessary. See Local Rule 105.6 (D. Md. 2021). For the following reasons, AAON's Motion will be denied, without prejudice to its ability to re-raise certain arguments at the conclusion of discovery.
The following facts are derived from the FAC, ECF 50, and are taken as true for purposes of evaluating AAON's motion to dismiss. Havtech sells heating, ventilation, and air conditioning (“HVAC”) equipment and repair parts in the construction industry. ECF 50 ¶ 5. AAON manufactures HVAC equipment for use in commercial and industrial buildings, and sells its “products nationwide through independent businesses, . . ., that are appointed as sales representatives for assigned geographic territories.” Id. ¶¶ 13-14. Havtech works with construction contractors, building owners, and engineers to choose and configure HVAC equipment for construction projects. Id. ¶ 15. AAON then manufactures HVAC equipment, which Havtech distributes. Id. ¶¶ 8, 15. The equipment AAON manufactures “for use by the construction industry” includes “rooftop units, outdoor air-handling units, indoor air handling units, chiller, condensing units, chillers, condensing units, water-source heat pumps, and coils.” Id. ¶ 13.
Havtech distributed AAON's HVAC equipment and parts to customers in Maryland, the District of Columbia, and Northern Virginia as one of its appointed sales representatives for over twenty-five years. Id. ¶¶ 18-19. Although the relationship between Havtech and AAON initially began as an “oral handshake agreement,” “[a]t some point along the way, [AAON] issued a written policy manual that purported to define the terms of its agreement with all its sales representatives.” Id. ¶ 20. This written manual, the AAON Policy Manual for Sales Representatives (“Dealer Agreement”), appointed Havtech as its independent sales representative to solicit orders for AAON's products in an assigned sales territory. ECF 49-2 at 5. The Dealer Agreement stipulates that such appointment may be terminated by either party at any time with good cause or without cause upon 30-days' advance written notice by the terminating party. Id. at 8, ¶ 16.A. As relevant here, the Dealer Agreement includes a choice-of-law clause, which provides that:
This APPOINTMENT shall be governed and construed in all respects in accordance with the laws of the state of Oklahoma. Any litigation instituted by Rep against AAON pertaining to any breach or termination of this appointment, or pertaining in any other manner to this.
On January 14, 2022, AAON and Havtech met at Havtech's office in Columbia, Maryland. ECF 50 ¶ 61. At the meeting, AAON provided Havtech a letter stating that Id.
Havtech filed its Complaint against AAON in the Circuit Court for Howard County, Maryland on January 24, 2022, asserting a single claim for damages under the Maryland Equipment Dealer Contract Act (“MEDCA”). ECF 3. AAON removed the action to this Court on February 23, 2022, ECF 1, and subsequently moved to dismiss, ECF 17. This Court granted the motion to dismiss without prejudice, finding that Oklahoma law governed the parties' dispute. ECF 29, 30. Havtech then filed the instant FAC asserting its claim under the OEDA, Oklahoma's analogue to MEDCA. ECF 50.
Under Rule 12(b)(6), a defendant may test the legal sufficiency of a complaint by way of a motion to dismiss. See In re Birmingham, 846 F.3d 88, 92 (4th Cir. 2017); Goines v. Valley Cmty. Servs. Bd., 822 F.3d 159, 165-66 (4th Cir. 2016); McBurney v. Cuccinelli, 616 F.3d 393, 408 (4th Cir. 2010), aff'd sub nom., McBurney v. Young, 569 U.S. 221 (2013); Edwards v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999). A Rule 12(b)(6) motion constitutes an assertion by a defendant that, even if the facts alleged by a plaintiff are true, the complaint fails as a matter of law “to state a claim upon which relief can be granted.”
Whether a complaint states a claim for relief is assessed by reference to the pleading requirements of Federal Rule of Civil Procedure 8(a)(2). That rule provides that a complaint must contain a “short and plain statement of the claim showing that the pleader is entitled to relief.” The purpose of the rule is to provide the defendants with “fair notice” of the claims and the “grounds” for entitlement to relief. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555-56 (2007).
To survive a motion under Federal Rule of Civil Procedure 12(b)(6), a complaint must contain facts sufficient to “state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570; see Ashcroft v. Iqbal, 556 U.S. 662, 684 (2009) () (quotation omitted); see also Willner v. Dimon, 849 F.3d 93, 112 (4th Cir. 2017). However, a plaintiff need not include “detailed factual allegations” in order to satisfy Rule 8(a)(2). Twombly, 550 U.S. at 555. Further, federal pleading rules “do not countenance dismissal of a complaint for imperfect statement of the legal theory supporting the claim asserted.” Johnson v. City of Shelby, Miss., 574 U.S. 10, 11 (2014) (per curiam).
Nevertheless, the rule demands more than bald accusations or mere speculation. Twombly, 550 U.S. at 555; see Painter's Mill Grille, LLC v. Brown, 716 F.3d 342, 350 (4th Cir. 2013). If a complaint provides no more than “labels and conclusions” or “a formulaic recitation of the elements of a cause of action,” it is insufficient. Twombly, 550 U.S. at 555. Rather, to satisfy the minimal requirements of Rule 8(a)(2), the complaint must set forth “enough factual matter (taken as true) to suggest” a cognizable cause of action, “even if . . . [the] actual proof of those facts is improbable and . . . recovery is very remote and unlikely.” Twombly, 550 U.S. at 556.
In reviewing a Rule 12(b)(6) motion, a court “must accept as true all of the factual allegations contained in the complaint” and must “draw all reasonable inferences [from those facts] in favor of the plaintiff.” E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011) (citations omitted); see Semenova v. MTA, 845 F.3d 564, 567 (4th Cir. 2017); Houck v. Substitute Tr. Servs., Inc., 791 F.3d 473, 484 (4th Cir. 2015); Kendall v. Balcerzak, 650 F.3d 515, 522 (4th Cir. 2011), cert. denied, 565 U.S. 943 (2011). However, a court is not required to accept legal conclusions drawn from the facts. See Papasan v. Allain, 478 U.S. 265, 286 (1986). “A court decides whether [the pleading] standard is met by separating the legal conclusions from the factual allegations, assuming the truth of only the factual allegations, and then determining whether those allegations allow the court to reasonably infer” that the plaintiff is entitled to the legal remedy sought. A Soc'y Without a Name v. Virginia, 655 F.3d 342, 346 (4th Cir. 2011), cert. denied, 566 U.S. 937 (2012).
Havtech has attached certain documents to the briefing of this motion. See, e.g., ECF 49-2. As another judge of this Court cogently explained:
As a general rule, the court does not consider extrinsic evidence at the motion to dismiss stage; however, it is a well-recognized exception to this rule that the court may consider, without converting the motion to dismiss into one for summary judgment, documents attached to the complaint as exhibits, and documents attached to a motion to dismiss if the document is “integral to the complaint and there is no dispute about the document's authenticity.” See Goines [], 822 F.3d [at] 166. A document is “integral” to the complaint if its “very existence, and not the mere information it contains, gives rise to the legal rights asserted.” Chesapeake Bay Found., Inc. v. Severstal Sparrows Point, LLC, 794 F.Supp.2d 602, 611 (D. Md. 2011) (internal quotation marks omitted) (emphasis removed). Where the complaint shows that the plaintiff has adopted the contents of the documents attached to the complaint, “crediting the document over conflicting allegations in the complaint is proper.” Goines, 822 F.3d at 167.
Reamer v. State Auto. Mut. Ins. Co., 556 F.Supp.3d 544, 549 (D. Md. 2021). Applying those standards, the Dealer Agreement is clearly integral to the Complaint because its termination gives rise to Havtech's claim. Neither party has challenged the authenticity of the Policy Agreement, which is also expressly referenced in the FAC. ECF 50 ¶ 63 (). Accordingly, this Court deems it appropriate to consider the Dealer Agreement, ECF 49-2, in adjudicating AAON's Motion, without converting the motion into one for summary judgment.[1]
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