Universal Cab Co., Inc. v. City of Charlotte

• Decision Date: 05 March 2015
• Docket Number: 14 CVS 10914
• Citation: 2015 NCBC 22 .
• Court: Superior Court of North Carolina
• Parties: UNIVERSAL CAB COMPANY, INC. and MOHAMED MOUSTAFA, Plaintiffs, v. CITY OF CHARLOTTE, PATRICK CANNON, THOMAS J. ORR, TIMOTHY E. NEWMAN, MOHAMMAD JENATIAN, THE GREATER CHARLOTTE HOSPITALITY AND TOURISM ALLIANCE, TAXI USA, LLC, CROWN CAB COMPANY, INC., CITY CAB, LLC, Defendants.

2015 NCBC 22.

UNIVERSAL CAB COMPANY, INC. and MOHAMED MOUSTAFA, Plaintiffs, v. CITY OF CHARLOTTE, PATRICK CANNON, THOMAS J. ORR, TIMOTHY E. NEWMAN, MOHAMMAD JENATIAN, THE GREATER CHARLOTTE HOSPITALITY AND TOURISM ALLIANCE, TAXI USA, LLC, CROWN CAB COMPANY, INC., CITY CAB, LLC, Defendants.

No. 14 CVS 10914

Superior Court of North Carolina, Mecklenburg

March 5, 2015

Hunter Higgins, PLLC by John F. Bloss for Plaintiffs Universal Cab Company, Incorporated and Mohamed Moustafa.

Leila Z. Lahbabi, Theodore A. Kaplan, and Elizabeth E. Smithers for Defendants City of Charlotte, Patrick Cannon, in his official capacity, and Thomas J. Orr, in his official capacity.

Lincoln Derr, PLLC by Lori Keeton for Defendant Thomas J. Orr, in his individual capacity.

Ferguson, Chambers & Sumter, P.A. by James E. Ferguson, II for Defendant Patrick Cannon, in his individual capacity.

Womble Carlyle Sandridge & Rice, LLP by Meredith J. McKee and Brandi N. Smith for Defendant Taxi USA, LLC.

Rabon Law Firm by Gary W. Jackson for Defendant Crown Cab Company.

Rawls, Scheer, Foster, Mingo & Culp, PLLC by Amanda A. Mingo for Defendants Mohammad Jenatian and The Greater Charlotte Hospitality and Tourism Alliance.

Rayburn Cooper & Durham, P.A. by G. Kirkland Hardymon, Ross R. Fulton, and Benjamin E. Shook for Defendant Timothy Newman.

McNaughton Law, PLLC by Edward J. McNaughton for Defendant City Cab, LLC.

ORDER AND OPINION

Bledsoe, Judge.

{1} THIS MATTER is before the Court upon Defendants City of Charlotte (the "City"), Patrick Cannon ("Cannon"), Thomas J. Orr ("Orr"), Timothy E. Newman ("Newman"), Mohammad Jenatian ("Jenatian"), The Greater Charlotte Hospitality and Tourism Alliance ("HTA"), Taxi USA, LLC ("Yellow Cab"), Crown Cab Company, Inc. ("Crown Cab"), and City Cab, LLC's ("City Cab") (collectively, "Defendants") respective Motions to Dismiss pursuant to Rules 12(b)(1) and 12(b)(6) of the North Carolina Rules of Civil Procedure (the "Motions") in the above-captioned case. After considering the Motions, briefs in support of and in opposition to the Motions, and the arguments of counsel at a hearing on January 9, 2015, the Court hereby GRANTS in part Defendants' Motions to Dismiss under Rule 12(b)(1), GRANTS in part the City of Charlotte's Motion to Dismiss under Rule 12(b)(6), and DISMISSES Plaintiffs' claims against all Defendants with prejudice.

I. PROCEDURAL AND FACTUAL BACKGROUND

{2} The Court limits its recitation of the background to the facts and allegations that are relevant for purposes of resolving the present Motions.

{3} Plaintiff Universal Cab Company, Inc. ("Universal") is a North Carolina corporation that provides taxi service in the Charlotte area. (Verified Am. Compl. ¶¶ 1, 12.) Plaintiff Mohamed Moustafa ("Moustafa") is the owner and President of Universal. (Id. ¶ 2.)

{4} Defendants Yellow Cab, Crown Cab, and City Cab (collectively "the Cab Defendants") are also taxi service providers in the Charlotte, North Carolina area. (Id. ¶¶ 9–11.)

{5} Defendant City "is a municipal corporation organized under the laws of North Carolina" and the owner and operator of Charlotte Douglas International Airport ("the Airport"). (Id. ¶ 3.) Defendant Cannon, at all times relevant to the claims alleged in the Verified Amended Complaint, was "a member of the Defendant City's Council, the City's Mayor Pro Tem, chairman of the City's Community Safety Committee, and an HTA board member, and is made a defendant in both his individual and official capacities." (Id. ¶ 8.) Defendant Orr served as the City's Aviation Director at the Airport at all times relevant to this action and is made a defendant in his individual and official capacities. (Id. ¶ 4.)

{6} Defendant HTA is a non-profit corporation with its principal place of business in Charlotte, North Carolina. (Id. ¶ 7.) Defendant Jenatian served as HTA's President at all times relevant to this action. (Id. ¶ 6.) Defendant Newman "was the Chief Executive Officer of the Charlotte Regional Visitors Authority ("CRVA"), and an ex-officio director of [HTA]" at all times relevant to this action. (Id. ¶ 5.)

{7} Plaintiffs filed their Complaint and Notice of Designation to this Court on June 12, 2014 in Mecklenburg County. This case was designated as a complex business case on June 13, 2014, assigned to the Business Court (Gale, J.) on June 18, 2014, and subsequently re-assigned to the undersigned on November 19, 2014.

{8} Plaintiffs filed their Verified Amended Complaint on July 11, 2014, alleging claims against Defendants in various combinations for breach of contract, breach of covenant of good faith and fair dealing, unfair and deceptive trade practices ("UDTP"), antitrust, interference with contract, restitution, rescission, violation of the North Carolina Constitution Article I § 19 ("equal protection"), declaratory judgment, punitive damages, civil conspiracy, and violation of the North Carolina Racketeer Influenced and Corrupt Organizations Act, N.C. Gen. Stat. § 75D-1, et seq. (" N.C. RICO"). (Id. ¶¶ 155–216.)

{9} The following allegations, drawn from the Verified Amended Complaint, form the factual basis of Plaintiffs' claims:

a. Universal provided "ground taxicab transportation services, including on-demand transportation via taxi from the Airport" ("Airport Taxi Service") from July 1, 1997 through July 2011 pursuant to a Taxicab Operating Agreement between the City and Universal. (Id. ¶ 13.) Airport Taxi Service was a "major component" of Universal's revenues. (Id. ¶ 15.)

b. The pertinent part of Universal's Taxicab Operating Agreement states that "this Agreement shall be deemed automatically renewed for successive one (1) year periods unless and until terminated by either party by giving written notice to the other no more than ninety (90) or less than thirty (30) days to the end of any calendar years." (Id. ¶ 21.)

c. On June 11, 2001, the Airport advised Universal that the contract would be extended on a month-to-month basis pending the completion of a process for application and selection. (Id. ¶ 24.) After the completion of the process for application and selection, Universal's Taxicab Operating Agreement once again was subject to automatic renewal for successive one-year periods absent notice of termination by either party under the terms of the Agreement. (Id. ¶ 29.)

d. In June 2006, Moustafa refused to change the paint scheme of Universal's taxis as requested by Newman. (Id. ¶¶ 33–34.) At a subsequent meeting, Newman and Jenatian allegedly "referred to Mr. Moustafa as a 'sand n-gger' and 'camel jockey, ' which are derogatory terms for people of Middle Eastern descent, " and agreed that they "were 'going to get his (Moustafa's) ass out of here.'" (Id. ¶ 35.) Moustafa is a "Sunni Muslim from Egypt." (Id. ¶ 194.)

e. In late 2006 or early 2007, Newman and Jenatian began discussions with Orr relating to Airport Taxi Service. (Id. ¶¶ 37–38.) Newman's alleged purpose for these discussions was to "oust Universal from providing Taxi Service at the Airport, and to position himself to influence decisions made about future Taxi Service providers at the Airport." (Id. ¶ 39.)

f. Orr allegedly "entered into communications with the owners of NBRS USA Holdings ("NBRS"), which owns [Yellow Cab], in which Defendant Orr agreed that he would cause [Yellow Cab] to be the sole provider of [Airport] Taxi Service." (Id. ¶ 42.) When NBRS submitted its application for Airport Taxi Service to the Airport, Orr caused the Airport's long-standing application and selection process to be changed. (Id. ¶¶ 45–46.)

g. Orr issued a Request for Proposals for Airport Taxi Service ("RFP #1") on August 18, 2010. (Id. ¶ 49.)

h. "On or about August 23, 2010, after the City Council received comments from representatives of the taxi industry, the City Council asked Defendant Orr to change the due date of responses to RFP #1. At the same time, the City Council referred the matter to its Community Safety Committee, which was then chaired by Defendant Cannon, who also at that time acted as the City's Mayor Pro Tem and was an HTA board member." (Id. ¶ 50.)

i. At approximately the same time, in August 2010, HTA, through Jenatian, allegedly approached Moustafa and other taxi service providers, "and told them that their problems at the Airport would go away, and that he would secure an operating agreement for them at the Airport, if they paid $5, 000.00 to join Defendant HTA as a corporate sponsor." (Id. ¶ 51.) Jenatian also allegedly informed Moustafa and other providers that "many members of the City Council, and several City staff personnel, were members of his organization, " and that Jenatian "was working closely with Defendants Orr and Newman, who would be making decisions about which Taxi Service providers would receive operating agreements at the Airport." (Id. ¶ 52.)

j. In September 2010, Jenatian allegedly solicited Moustafa to make a contribution to a local political campaign, but Moustafa refused to contribute to the campaign. (Id. ¶¶ 55–56.) At about the same time, Jenatian introduced Moustafa to Defendant Cannon, and Cannon and Jenatian, together, solicited Moustafa to join HTA. (Id. ¶ 57.) Universal thereafter joined HTA, but not at the corporate sponsor level. (Id. ¶ 60.) At the same time, Yellow Cab and Crown Cab joined HTA at the corporate sponsor level. (Id. ¶ 62.)

k. The Community Safety Committee met on September 7, 2010 to review RFP #1. (Id. ¶ 63.) At that meeting, Orr and the Airport's attorney, Leila Lahbabi ("Lahbabi"), made a presentation during which Lahbabi "stated that one of the most frequent complaints made to the Airport was from the CRVA about the quality of the Taxi Service that is available at the Airport." (Id.)

l. Plaintiffs allege that Newman and others "caused bogus complaints [about Airport Taxi Service] to be made on behalf of the CRVA for the purpose of undermining Universal's efforts to continue to provide [Airport] Taxi Service." (Id. ¶ 65.)

m.

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