Vestring v. Halla

• Decision Date: 30 January 2013
• Docket Number: Case No. 12–4094–JTM.
• Citation: 920 F.Supp.2d 1189
• Parties: Anna Graves VESTRING and Robert Vestring, Plaintiffs, v. Carl “Bunge” HALLA; H Bar Cattle Company; Eagle Creek General Store; United Agricultural Cooperative, Inc.; and Farmers Cooperative of El Campo, Defendants.
• Court: U.S. District Court — District of Kansas

920 F.Supp.2d 1189

Anna Graves VESTRING and Robert Vestring, Plaintiffs,

v.Carl “Bunge” HALLA; H Bar Cattle Company; Eagle Creek General Store; United Agricultural Cooperative, Inc.; and Farmers Cooperative of El Campo, Defendants.

Case No. 12–4094–JTM.

United States District Court, D. Kansas.

Jan. 30, 2013.

Charles C. Steincamp, Molly M. Gordon, Nathan R. Hoffman, Randall K. Rathbun, Depew Gillen Rathbun & McInteer, LC, Wichita, KS, for Plaintiffs.

David P. Calvert, David P. Calvert, PA, Michael J. Norton, Foulston Siefkin LLP, Brett D. Legvold, Greg A. Drumright, Martin, Pringle, Oliver, Wallace & Bauer, LLP, Wichita, KS, for Defendants.

MEMORANDUM AND ORDER

J. THOMAS MARTEN, District Judge.

The court has before it several motions to dismiss by the defendants. Defendants United Agricultural Cooperative, Inc., f/k/a/ Farmers Cooperative of El Campo, and Eagle Lake General Store (incorrectly sued as “Eagle Creek General Store”) (collectively referred to herein as “defendants” or “United Ag”), filed a motion to dismiss for lack of personal jurisdiction and improper venue (Dkt. 16) as well as a motion to dismiss for failure to state a claim (Dkt. 19). Defendant H Bar also filed a motion to dismiss for lack of personal jurisdiction and improper venue (Dkt. 21), which defendant Carl “Bunge” Halla incorporated in his own motion to dismiss (Dkt. 23). The court grants all of the defendants' motions to dismiss for the reasons below.

I. Factual Background

Plaintiffs Anna Graves Vestring and Robert Vestring are Kansas residents who claim to have entered into a contract in September 2011 with defendant Carl “Bunge” Halla, a Texas resident and employee of defendant United Ag. Plaintiffs were in Kansas when they accepted Halla's offer over the phone. Under the contract, Halla agreed to provide agricultural services and serve as a bailee for certain lightweight cattle purchased by plaintiffs. All of the cattle were bought in Texas.

After the cattle were purchased, they were sheltered at facilities owned and operated by H Bar Cattle Company in Texas. At the H Bar facilities, the cattle suffered a death rate of 25%, which plaintiffs claim is significantly higher than the industry average. Plaintiffs allege that Halla and H Bar caused them damage by breaching the duty to properly care for, feed, and maintain the cattle in a reasonable and workmanlike manner. Plaintiffs ask this court to hold Halla and H Bar jointly and severally liable for damages in excess of $75,000 and to order recoupment of all plaintiffs' payments.

Additionally, to pay for the services associated with the purchase and care of these cattle, plaintiffs obtained a $350,000 line of credit from the Cooperative Finance Association, Inc., a corporation located in Kansas City, Missouri. Mr. Vestring completed, signed, and faxed an application to United Ag for an account to acquire goods on store credit. United Ag set up a store account for Mr. Vestring. Plaintiffs instructed Bunge not to incur expenses exceeding $350,000 in caring for, feeding, and maintaining the cattle. Plaintiffs claim that notwithstanding their instruction, Bunge had defendants H Bar, Eagle Lake, Farmers Cooperative, and United Ag bill plaintiffs for a total substantially in excess of the line of credit for services, materials, and supplies for the cattle. Plaintiff asks this court to enter judgment against defendants for (1) an accounting of all amounts claimed to arise out of the care, feeding, and maintenance of the cattle and (2) an accounting of cattle purchased and sold including all cattle which died while in defendants' care and control.

Defendant United Ag challenges the sufficiency of the pleadings set forth in the complaint. All defendants challenge whether Kansas has personal jurisdiction over them and whether venue is proper. Alternatively, they request the case be transferred to the Southern District of Texas.

II. Failure to State a ClaimA. Legal Standard

Federal Rule of Civil Procedure 8(a)(2) provides that a complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” The complaint must give the defendant adequate notice of what the plaintiff's claim is and the grounds of that claim. Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002).

“In reviewing a motion to dismiss, this court must look for plausibility in the complaint.... Under this standard, a complaint must include enough facts to state a claim to relief that is plausible on its face.” Corder v. Lewis Palmer Sch. Dist. No. 38, 566 F.3d 1219, 1223–24 (10th Cir.2009) (internal quotations and citations omitted). In addition to the allegations contained in the complaint, the court may consider attached exhibits and documents incorporated into the complaint, so long as the parties do not dispute the documents' authenticity. See Smith v. United States, 561 F.3d 1090, 1098 (10th Cir.2009). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (clarifying and affirming Twombly's probability standard). Allegations that raise the specter of mere speculation are not enough. Corder, 566 F.3d at 1223–24.

While the factual allegations need not be detailed, the claims “must set forth the grounds for plaintiffs' entitlement to relief through more than labels, conclusions, and a formulaic recitation of the elements of a cause of action.” In re Motor Fuel Temperature Sales Practices Litig., 534 F.Supp.2d 1214, 1216 (D.Kan.2008). The court must assume that all allegations in the complaint are true. Twombly, 550 U.S. at 589, 127 S.Ct. 1955. “The issue in resolving a motion such as this is ‘not whether [the] plaintiff will ultimately prevail, but whether the claimant is entitled to offer evidence to support the claims.’ ” Bean v. Norman, No. 008–2422, 2010 WL 420057, at *2 (D.Kan. Jan. 29, 2010) (quoting Swierkiewicz, 534 U.S. at 511, 122 S.Ct. 992).

B. Analysis

In this case, the complaint fails to allege sufficient facts to state a plausible claim against United Ag. First, the complaint alleges that Halla owns an interest in all or part of the United Ag entities and serves as an employee and manager for United Ag. Second, the complaint alleges that at Halla's request and without plaintiffs' authorization, United Ag billed plaintiffs for an amount in excess of a line of credit Halla knew plaintiffs had established with Cooperative Finance Association, Inc. To state a claim for relief, plaintiffs must connect these two facts in a way that would make United Ag liable. Although a connection is not found in the complaint, plaintiff Robert Vestring's affidavit provides one, and the court may rely on this. See Smith, 561 F.3d at 1098. In his affidavit, Vestring alleges that during his phone calls with Halla, Halla “was acting on his own behalf as well as an agent for” United Ag. Vestring also states that Halla is a manager of one of the United Ag entities “and thus is an agent of United Ag.” However, Vestring's conclusory statements cannot provide a proper basis for pleading agency.

A claim alleging an agency cause of action must allege that the agent had authority—actual or apparent—to act on the principal's behalf. See Mulholland v. Metropolitan Life Ins. Co., 546 F.Supp.2d 1231, 1235 (D.Kan.2008); see also Bridgewater v. Carnival Corp., No. 10–22241, 2011 WL 817936, at *2 (S.D.Fla. Mar. 2, 2011) (stating that a complaint must allege all the necessary elements for a claim of apparent agency). The fact that Halla was an employee of United Ag when he called plaintiffs to solicit business does not, by itself, meet the standard of a plausible claim for agency. United Ag is not in the business of caring for cattle, which is what Halla allegedly contracted with plaintiffs to do. Plaintiffs have not pled any facts that show Halla had United Ag's authority, either actual or apparent, to enter into a contract for a business that United Ag is not involved in. Under these circumstances, the court finds that plaintiffs have not plead sufficient facts to support their contention that Halla acted as an agent of United Ag.C. Amending the Complaint

Plaintiffs contend that the proper remedy is for the court to grant them leave to amend under F. Rule Civ. P. 15(a)(2). Rule 15(a)(2) states that the court may grant leave to amend when justice so requires. But generally, a party must file a motion to amend before the court will grant leave to amend. Robinson v. Farmers Services L.L.C., 10–CV–02244–JTM, 2010 WL 4067180, at *5 (D.Kan. Oct. 15, 2010) (quoting Calderon v. Kan. Dep't of Soc. & Rehab. Servs., 181 F.3d 1180, 1185–86 (10th Cir.1999)). If a party does not file a formal motion to amend its pleading, the Tenth Circuit provides that a request for leave to amend must give adequate notice to the district court and to the opposing party of the basis for the proposed amendment before the court must recognize that a motion for leave to amend is before it. Calderon, 181 F.3d at 1186–87. However, a plaintiff's bare request in response to a motion to dismiss “that leave be given to the Plaintiffs to amend their Complaint” is insufficient. Id. at 1186 (quoting Glenn v. First Nat'l Bank, 868 F.2d 368, 370 (10th Cir.1989)).

In this case, at the end of their response to the motion to dismiss, plaintiffs merely state that “[i]n the alternative, plaintiffs should be given leave to amend their complaint.” Plaintiffs make no mention of what amendments might be made or how they might cure the deficiencies of the original complaint. The court found a similar request to amend insufficient in Robinson v. Farmers Servs. L.L.C., 10–CV–02244–JTM, 2010 WL 4067180, at *5 (D.Kan. Oct. 15, 2010), when the plaintiffs' only request for leave to amend came at the end of her...