Two Old Hippies Llc v. Catch the Bus Llc
| Decision Date | 11 February 2011 |
| Docket Number | No. CIV 10–0459 JB/RLP.,CIV 10–0459 JB/RLP. |
| Citation | 784 F.Supp.2d 1200 |
| Parties | TWO OLD HIPPIES, LLC, Plaintiff,v.CATCH THE BUS, LLC, Gary Mack and Fallon Mack, Defendants. |
| Court | U.S. District Court — District of New Mexico |
OPINION TEXT STARTS HERE
Rebecca L. Avitia, Thomas P. Gulley, Bannerman & Johnson, PA, Albuquerque, NM, for the Plaintiff.Catch the Bus, LLC, Alamogordo, NM, Defendant pro se.Gary Mack, Alamogordo, NM, Defendant pro se.Fallon Mack, Alamogordo, NM, Defendant pro se.
THIS MATTER comes before the Court on the Defendants' Motion to Dismiss, filed June 23, 2010 (Doc. 7)(“Motion”). The Court held a hearing on January 12, 2010. The primary issues are: (i) whether Plaintiff Two Old Hippies, LLC, has adequately sets forth factual allegations showing that Defendants Gary Mack and Fallon Mack (together “Individual Defendants”) and Catch the Bus, LLC (collectively “Defendants”) misrepresented the condition of two Volkswagen Buses that Two Old Hippies purchased from the Defendants under rule 9(b) of the Federal Rules of Civil Procedure; (ii) whether Two Old Hippies has adequately pled its claims under rule 8(a); (iii) and whether Two Old Hippies has alleged facts establishing individual liability on behalf of the Individual Defendants. The Court grants in part and denies in part the Defendants' Motion to Dismiss, dismissing all claims against the Individual Defendants and Two Old Hippies' claim under the Colorado Consumer Protection Act C.R.S., §§ 6–1–101 through 6–1–115 (“CCPA”)—Count V—against all Defendants.
This matter concerns Two Old Hippies' purchase of two restored Volkswagen Buses from the Defendants. The following facts are taken from Two Old Hippies' Complaint, which the Court treats as true for the purposes this Motion.
In July of 2009, Two Old Hippies ordered a customized 1965 Volkswagen Bus (Bus # 1) from Catch the Bus for $41,424.00. In October of 2009, Two Old Hippies ordered an additional customized Volkswagen Bus (Bus # 2) from Catch the Bus for $33,624.00. The Defendants guaranteed Two Old Hippies one-hundred percent satisfaction with the buses (“the guarantee”), and that the buses would be “ready to go” on delivery “whether for daily driver or for cross-country trips” (“the promise”). Complaint for Breach of Contract, Breach of Warranty, Violation of the New Mexico Dealers Franchising Act, Violation of the New Mexico Unfair Practices Act, Violation of the Colorado Consumer Protection Act, Negligent Misrepresentation, and Rescission ¶¶ 13, 14 at 2, filed May 13, 2010 (Doc. 1)(“Complaint”).
On Bus # 1, the Defendants overcharged Two Old Hippies $1,500.00 for air conditioning and $1,000.00 for snow tires, which were not provided. Two Old Hippies planned to use Bus # 1 in its business and to give away Bus # 2 as part of a business promotion. The Defendants knew of Two Old Hippies' plans for the buses.
Upon delivery, the buses were not safely operable and had many serious mechanical defects. Because of these issues, Two Old Hippies has been unable to use Bus # 1, and Two Old Hippies had to reacquire Bus # 2 from the winner of the business promotion for $33,624.00, making the total amount that Two Old Hippies has expended on the buses $108,672.00. Two Old Hippies demanded refund of the purchase price and related compensation from the Defendants, and the Defendants have refused its demands.
Two Old Hippies brings this diversity action, alleging claims under New Mexico state law for breach of contract—Count I; breach of warranty—Count II; violation of the New Mexico Motor Dealers Franchising Act, N.M.S.A.1978, §§ 57–16–1 through 57–16–16 (“MVDFA”)—Count III; violation of the New Mexico Unfair Trade Practices Act, N.M.S.A.1978, §§ 57–12–1 through 57–12–26 (“UPA”)—Count IV; negligent misrepresentation—Count VI; and rescission—Count VII. Two Old Hippies also brings a claim under Colorado law for a violation of the CCPA—Count V.
On June 23, 2010, the Defendants—through counsel—filed their Answer to Complaint for Breach of Contract, Breach of Warranty, Violation of the New Mexico Dealers Frachising [sic] Act, Violation of the New Mexico Unfair Practices Act, Violation of the Colorado Consumer Protection Act, Negligent Misrepresentation, and Rescission. See Doc. 6. On June 28, 2010, the Defendants filed their Jury Demand. See Doc. 9. The Jury Demand requests a six-person jury.
On June 23, 2010, the Defendants filed their Motion, see Doc. 7, and Memorandum Brief in Support of Defendants' Motion to Dismiss, see Doc. 8 (“Memorandum”). The Individual Defendants move the Court to dismiss with prejudice all Counts against them individually pursuant to rule 12(b)(6), because they cannot be held personally liable for the actions of Catch the Bus based only on their positions as corporate officers. The Defendants also move the Court to dismiss Counts II through VII under rule 12(b)(6), because they contend that Two Old Hippies has failed to state with particularity specific factual allegations establishing plausible claims under Counts II through VII, and that the claims should be dismissed. The Defendants further contend that the Court should dismiss Counts III, IV, V, and VII, because Two Old Hippies does not plead the alleged misrepresentation in accordance with rule 9(b)'s pleading requirements.
On June 30, 2010, Two Old Hippies filed its Response in Opposition to Defendants' Motion to Dismiss [Doc. 7]. See Doc. 11. Two Old Hippies opposes the Defendants' Motion, arguing that its Complaint adequately sets forth factual allegations to support its claims. Two Old Hippies also asserts that the Defendants do not challenge the adequacy of Counts I or VI against Catch the Bus. Two Old Hippies further contends that its adequately pled facts implicating the Individual Defendants as directly participating in the acts on which it bases its claims.
On July 14, 2010, the Defendants filed their Reply to Plaintiff's Response in Opposition to Defendants' Motion to Dismiss. See Doc 14 (“Reply”). The Defendants concede that they do not move to dismiss Count I against Catch the Bus, but assert that they move to dismiss Count VI against Catch the Bus, because Two Old Hippies did not adequately plead facts to support the allegation. The Defendants also contend that Two Old Hippies has not pled facts showing that the Individual Defendants were directly involved in the transaction, and that the Defendants cannot be held liable for contract violations or unintentional torts.
The Defendants did not appear at the January 12, 2010 hearing. Two Old Hippies argued in support of denying the Motion. The Court indicated that it was inclined to deny the Motion, but took the matter under advisement.
Under rule 12(b)(6), a court may dismiss a complaint for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). “The nature of a Rule 12(b)(6) motion tests the sufficiency of the allegations within the four corners of the complaint after taking those allegations as true.” Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir.1994). The sufficiency of a complaint is a question of law, and when considering and addressing a rule 12(b)(6) motion, a court must accept as true all well-pleaded factual allegations in the complaint, view those allegations in the light most favorable to the non-moving party, and draw all reasonable inferences in the plaintiff's favor. See Moore v. Guthrie, 438 F.3d 1036, 1039 (10th Cir.2006); Hous. Auth. of Kaw Tribe v. City of Ponca City, 952 F.2d 1183, 1187 (10th Cir.1991).
A complaint challenged by a rule 12(b)(6) motion to dismiss does not require detailed factual allegations, but a plaintiff's obligation to set forth the grounds of his or her entitlement to relief “requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 545, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). “Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact).” Bell Atl. Corp. v. Twombly, 550 U.S. at 555, 127 S.Ct. 1955 (internal citation omitted). “[T]he Supreme Court recently ... prescribed a new inquiry for us to use in reviewing a dismissal: whether the complaint contains ‘enough facts to state a claim to relief that is plausible on its face.’ ” Ridge at Red Hawk, L.L.C. v. Schneider, 493 F.3d 1174, 1177 (10th Cir.2007) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. at 547, 570, 127 S.Ct. 1955). “The [Supreme] Court explained that a plaintiff must ‘nudge his claims across the line from conceivable to plausible’ in order to survive a motion to dismiss.” Ridge at Red Hawk, L.L.C. v. Schneider, 493 F.3d at 1177 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. at 570, 127 S.Ct. 1955) (alterations omitted). “Thus, the mere metaphysical possibility that some plaintiff could prove some set of facts in support of the pleaded claims is insufficient; the complaint must give the court reason to believe that this plaintiff has a reasonable likelihood of mustering factual support for these claims.” Ridge at Red Hawk, L.L.C. v. Schneider, 493 F.3d at 1177. The United States Court of Appeals for the Tenth Circuit has stated:
“[P]lausibility” in this context must refer to the scope of the allegations in a complaint: if they are so general that they encompass a wide swath of conduct, much of it innocent, then the plaintiffs “have not nudged their claims across the line from conceivable to plausible.” The allegations must be enough that, if assumed to be true, the plaintiff plausibly (not just speculatively) has a claim for relief.
Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir.2008) (quoting Bell Atl. Corp. v. Twombly, 127 S.Ct. at 1974) (internal citations omitted).
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