United States District Court, D. Maryland
Richard D. Bennett, United States District Judge.
Great Divide Insurance Company (“Great Divide” or
“plaintiff”) has filed this action against
defendants Workforce Management Solutions, Inc.
(“Workforce”) and WMS Solutions, LLC
(“WMS”) based on Workforce's failure to pay
insurance premiums owed under a workers compensation
insurance policy (“the Policy”) issued by Great
Divide. (ECF No. 14 at ¶¶ 9-22.) Plaintiff alleges
that Workforce and WMS are related business entities which
share owners, operators, and employees, and that both
entities have been unjustly enriched by their non-payment of
the insurance premiums. (Id. at ¶¶ 24-25.)
WMS has filed a Motion to Dismiss plaintiff's Amended
Complaint (“WMS's Motion”), asserting that
WMS was not a party to the Policy and, therefore, cannot be
liable for Workforce's alleged failure to pay premiums
owed. (ECF No. 18.) Workforce has not filed any response to
plaintiff's Complaint, and the Clerk of Court entered a
default against Workforce on August 22, 2017. (ECF No. 30.)
Court conducted an off-the-record telephone conference with
the parties on August 9, 2017 to discuss certain arguments
set forth in the parties' briefs. No additional hearing
is required. See Local Rule 105.6 (D. Md. 2016). For
the reasons stated below, WMS's Motion to Dismiss (ECF
No. 18) is GRANTED IN PART and DENIED IN PART. Specifically,
it is GRANTED as to the breach of contract claim against WMS
(Count I), and it is DENIED as to the unjust enrichment claim
against WMS (Count II).
September 5, 2014, plaintiff Great Divide Insurance Company
issued a renwal Workers Compensation and Employers Liability
Insurance Policy (“the Policy”) to defendant
Workforce. (ECF No. 14 at 9.) Premiums under the policy were
based on the estimated employee wages to be paid by Workforce
during the applicable policy period. (Id. at ¶
10.) While Workforce submitted an estimated employee wage
amount of $1, 562, 200, an audit conducted on January 8, 2016
revealed that Workforce's actual employee wages for the
applicable period amounted to $10, 500, 631. (Id. at
¶¶ 10, 13.) Based on this disparity, Great Divide
determined that Workforce owed additional premiums in the
amount of $1, 630, 632. (Id. at ¶ 14.)
Workforce challenged the results of the audit, and following
a re-audit, Great Divide determined that Workforce owed
additional premiums in the amount of $635, 161. (Id.
at ¶¶ 15-16.) After deducting amounts previously
paid, commissions, and surcharges, Great Divide demanded
payment from Workforce in the amount of $609, 560.76.
(Id. at ¶ 17.) Workforce has refused to make
payment on this balance. (Id. at ¶ 20.)
Plaintiff's Amended Complaint alleges that both
Workforce-the insured-and WMS-a “related compan[y],
which share[s] owners, operators and/or employees [with
Workforce]”-have derived an unjust benefit from the
services provided by Great Divide. (Id. at ¶
12(b)(6) of the Federal Rules of Civil Procedure authorizes
the dismissal of a complaint if it fails to state a claim
upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). The
purpose of Rule 12(b)(6) is “to test the sufficiency of
a complaint and not to resolve contests surrounding the
facts, the merits of a claim, or the applicability of
defenses.” Presley v. City of Charlottesville,
464 F.3d 480, 483 (4th Cir. 2006); see also Goines v.
Valley Cmty. Servs. Bd., 822 F.3d 159, 165-66 (4th Cir.
2016). The sufficiency of a complaint is assessed by
reference to the pleading requirements of Rule 8(a)(2), which
provides that a complaint must contain a “short and
plain statement of the claim showing that the pleader is
entitled to relief.” Fed.R.Civ.P. 8(a)(2).
survive a motion under Fed.R.Civ.P. 12(b)(6), a complaint
must contain facts sufficient to “state a claim to
relief that is plausible on its face.” Bell Atl.,
Corp. v. Twombly, 550 U.S. 544, 570 (2007); Ashcroft
v. Iqbal, 556 U.S. 662, 684 (2009). Under the
plausibility standard, a complaint must contain “more
than labels and conclusions” or a “formulaic
recitation of the elements of a cause of action.”
Twombly, 550 U.S. at 555; see Painter's Mill
Grille, LLC v. Brown, 716 F.3d 342, 350 (4th Cir. 2013).
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 Houck v. Substitute Tr. Servs.,
Inc., 791 F.3d 473, 484 (4th Cir. 2015); Semenova v.
Maryland Transit Admin., 845 F.3d 564, 567 (4th Cir.
2017). While a court must accept as true all the factual
allegations contained in the complaint, legal conclusions
drawn from those facts are not afforded such deference.
Iqbal, 556 U.S. at 678 (“[t]hreadbare recitals
of the elements of a cause of action, supported by mere
conclusory statements, do not suffice” to plead a
claim); see A Society Without a Name v. Virginia,
655 F.3d 342, 346 (4th. Cir. 2011).
Breach of Contract
WMS Solutions, LLC has moved to dismiss plaintiff's
breach of contract claim, asserting that because WMS is not a
party to the Policy, Great Divide fails to state a plausible
claim against it. (ECF No. 18.) Great Divide argues in
opposition that WMS and contract signatory Workforce are
related entities and that “[e]ven if the Great Divide
Amended Complaint pleads the claim inartfully, it plainly
alleges a relationship in fact between WMS and Workforce such
that WMS benefitted from the workers compensation insurance
provided by Great Divide.” (ECF No. 21 at 1.) Great
Divide asserts that it should be allowed to undertake
discovery “to ascertain the nature of this relationship
and whether these two entities-sharing a common address,
working on common projects for common customers,
and…common employees” are so related so as to
give rise to liability on the part of non-signatory WMS.
(Id. at 2.)
prevail in an action for breach of contract, a plaintiff must
prove that the defendant owed the plaintiff a contractual
obligation and that the defendant breached that
obligation.” Taylor v. NationsBank N.A., 365
Md. 166, 175 (2001). “Normally a person cannot be held
liable under a contract to which he was not a party.”
Snider Bros. v. Heft, 271 Md. 409, 414, 317 A.2d
848, 851 (1974). See Kurland v. ACE Am. Ins. Co.,
JKB-15-2668, 2017 WL 354254, at *2 (D. Md. Jan. 23, 2017).
Here, the Amended Complaint alleges that Workforce, not WMS,
was a party to the insurance contract giving rise to Great
Divide's claims. Although non-contracting parties may
become bound by a contract, Great Divide has not alleged such