Law Offices of Ernesto Martinez, Jr., PLLC v. Hellmich Law Grp., PC
| Decision Date | 08 July 2015 |
| Docket Number | CIVIL NO. SA-14-CA-769-OLG |
| Parties | THE LAW OFFICES OF ERNESTO MARTINEZ, JR., PLLC Plaintiff, v. HELLMICH LAW GROUP, PC, and KENNIE ARRIOLA AND ASSOC. Defendants. |
| Court | U.S. District Court — Western District of Texas |
Pursuant to the order of referral in the above-styled and numbered cause of action to the undersigned United States Magistrate Judge1 and consistent with the authority vested in United States Magistrate Judges under the provisions of 28 U.S.C. § 636(b) and rule 1 of the Local Rules for the Assignment of Duties to United States Magistrate Judges in the Western District of Texas, the following report is submitted for your review and consideration.
On August 29, 2014, defendant Hellmich Law Group ("HLG") removed plaintiff's original petition to this Court from the District Court for the 131st Judicial District Court in Bexar County, Texas, based on federal diversity subject matter jurisdiction pursuant to 28 U.S.C.§ 1332.2 Defendant Kenny Arriola and Associates ("KAA") filed its consent to removal on September 9, 2014.3 Plaintiff, Law Offices of Ernesto Martinez, Jr., PLLC ("plaintiff") has not challenged federal subject matter jurisdiction.
Plaintiff initiated this case in the 131st Judicial District Court of Bexar County on August 19, 2014, when it filed its original petition naming as defendants HLG and AKA (collectively, "defendants").4 Plaintiff alleges defendants "ha[ve] been communicating and improperly soliciting clients of the Plaintiff in an attempt to join defendant [HLG] against [plaintiff], in an attempt to file a baseless and fraudulent claim against [plaintiff]" and "interfere with their representation."5 Plaintiff alleges AKA "has made defamatory and false statements along with disparaging remarks to third parties" including "disparaging words about the Plaintiff's economic interest, based on false allegations."6 Plaintiff alleges defendants have "suffered as a result of [defendants'] actions of communicating and contacting our clients to join in Defendants['] representation based on baseless and fraudulent claims."7
Based on the factual allegations, plaintiff asserts four state law causes of action: (1) tortious interference with the contract between plaintiff and its clients regarding the FDIC litigation; (2) "Conspiracy to Interfere with a Business Relationship;" (3) business disparagement; and (4) defamation.8 As relief, plaintiff seeks damages pre- and post-judgment interest, costs, and injunctive relief.9 Plaintiff attaches to its original petition a single exhibit, the affidavit of Ernesto Martinez, which he incorporates by reference into the complaint.10
On August 29, 2014, HLG removed plaintiff's state case to this Court, asserting diversity jurisdiction exists over plaintiff's claims.11 On September 2, 2014, KAA filed its consent to removal.12 AKA's consent is filed pro se and is signed by Kennie Arriola, who represents that"the name 'Kennie Arriola and Associates' is a name used for the business and is not the name of a legally formed organization or entity."13
On September 19, 2014, HLG filed an unopposed motion to stay the case for 120 days "to assist the parties' efforts to reach an early resolution of the underlying disputes."14 On September 22, 2014, the District Court granted the motion.15 On March 17, 2015 the District Court entered an order stating "[t]he Court has been notified that the parties are deciding whether to submit all claims in this lawsuit to arbitration, to be joined with related arbitration proceedings" and ordering the parties to "either file a motion to dismiss this lawsuit in lieu of binding arbitration or a written advisory stating they could not agree to binding arbitration" within twenty days of the order.16 On April 6, 2015, plaintiff filed a "Notice of Continuation of Action," representing that the parties did not agree to binding arbitration and requesting a lift of the stay.17 On April 8, 2015, the District Court entered an order lifting the stay.18
On April 28, 2015, HLG filed a motion to dismiss plaintiff's claims for failure to state a claim for relief and, in the alternative, a motion for summary judgment.19 In support, HLGattaches a total of five exhibits to its combined motion.20 On April 29, 2015, AKA filed a motion to dismiss and compel arbitration.21
On May 11, 2015, plaintiff filed its response to HLG's motion to dismiss or for summary judgment.22 On May 12, plaintiff filed its response to AKA's motion to dismiss and compel arbitration.23
On May 18, 2015, HLG filed a reply in support of its Rule 12(b)(6) motion to dismiss and alternative Rule 56 motion for summary judgment.24 On the same day, AKA filed a reply in support of its motion to dismiss and compel arbitration.25
Rule 12(b)(6) of the Federal Rules of Civil Procedure, in turn, requires the plaintiff to state a claim upon which relief can be granted or the complaint may be dismissed with prejudice as a matter of law.26 When considering whether the plaintiff has failed to state a claim, the "courtaccepts 'all well-pleaded facts as true, viewing them in the light most favorable to the plaintiff.'"27 To withstand a Rule 12(b)(6) motion, "the plaintiff must plead 'enough facts to state a claim to relief that is plausible on its face.'"28
Rule 8(a)(2) of the Federal Rules of Civil Procedure sets out the fundamental pleading standard for civil litigation and governs all claims in a civil suit, requiring "a short plain statement of the claim showing that the pleader is entitled to relief."29 Although "heightened fact pleading of specifics"30 may not be adopted when not authorized by the Federal Rules of CivilProcedure,31 the complaint taken as a whole "must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory"32 and a plaintiff's pleading obligation includes the twin requirements of fact-based pleading and plausibility. More specifically, "a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do."33 "Factual allegations must be enough to raise a right to relief above the speculative level . . . on the assumption that all of the allegations in the complaint are true (even if doubtful in fact)."34 Although the Supreme Court in Twombly stressed that it did not impose a probability standard at the pleading stage, nevertheless, the allegation of a mere possibility of relief does not satisfy the threshold requirement of Rule 8(a)(2) that the "plain statement" of a claim include factual "allegations plausibly suggesting (not merely consistent with)" an entitlement to relief.35
When ruling on a motion to dismiss under Rule 12(b)(6), a court must accept as true all of the factual allegations contained in the complaint.36 But, a court need not accept as true "conclusory allegations, unwarranted factual inferences, or legal conclusions," which will not defeat a Rule 12(b)(6) motion to dismiss.37 In Iqbal, the Court formalized a two-pronged approach to apply the underlying jurisprudential principles of Twombly.38 The first prong required the Court to separate factual allegations from legal conclusions. The Court dismissed those allegations deemed to be "conclusory" on the basis that bare legal conclusions are not entitled to the privilege that all well-pleaded facts be taken as true at the motion to dismiss stage.39 The second prong then applied the plausibility test to the remaining allegations.40 Thattwo-pronged approach is now the standard for evaluating the plausibility of a complaint under Rule 8(a)(2).
The standard to be applied in deciding a motion for summary judgment is set forth in Rule 56 of the Federal Rules of Civil Procedure, which provides in pertinent part as follows:
The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.41
Mere allegations of a factual dispute between the parties will not defeat an otherwise proper motion for summary judgment. Rule 56 requires that there be no genuine issue of material fact.42 A fact is material if it might affect the outcome of the lawsuit under the governing law.43 A dispute about a material fact is genuine if the evidence is such that a reasonable jury could returna verdict for the nonmoving party.44 Therefore, summary judgment is proper if, under governing laws, there is only one reasonable conclusion as to the verdict; if reasonable finders of fact could resolve a factual issue in favor of either party, summary judgment should not be granted.45
The movant on a summary judgment motion bears the initial burden of providing the court with a legal basis for its motion and identifying those portions of the record which it alleges demonstrate the absence of a genuine issue of material fact.46 The burden then shifts to the party opposing the motion to present affirmative evidence to defeat a properly supported motion for summary judgment.47 All facts and inferences drawn from those facts must be viewed in the light favorable to the party resisting the motion for summary judgment.48 "The court needconsider only the cited materials, but it may consider other materials in the record."49 Summary judgment motions permit the Court to resolve a lawsuit without the necessity of a trial if there is no genuine dispute as to any material facts and the moving party is entitled to judgment as a matter of law.50 "A party may object that the material cited to support or dispute a fact cannot be presented in...
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