United States District Court, D. Maryland
Lipton Hollander United States District Judge.
Farm Fresh Direct Direct By a Cut Above, LLC (“Farm
Fresh Direct”) filed suit (ECF 1) against defendants
Steven Downey; Clipper City Lending, LLC (“Clipper
City”); Farm Fresh Direct Home Food Services, LLC
(“Farm Fresh Home”); and Jessica Sinsky, alleging
unfair competition, in violation of Section 43(a) of the
Lanham Act, 15 U.S.C. § 1125(a) (Count I), and unfair
competition and deceptive trade practices under Maryland
common law (Count II). ECF 1 at 5-6. Count III, for breach of
contract, is brought only as to Downey and Clipper City.
See ECF 1 at 6-7.
who is self-represented, filed an Answer to the Complaint on
July 24, 2017. ECF 10 (“Answer”). In addition,
Sinsky moved to dismiss the Complaint. ECF 12
(“Motion”). Plaintiff opposes the Motion. ECF 14
(“Opposition”). No reply has been filed.
hearing is necessary to resolve the Motion. See
Local Rule 105.6. However, in resolving the Motion, the Court
is mindful of its obligation to construe liberally the
pleadings of a pro se litigant, which are “held to less
stringent standards than formal pleadings drafted by
lawyers.” Erickson v. Pardus, 551 U.S. 89, 94
(2007); see also White v. White, 886 F.2d 721,
722-23 (4th Cir. 1989).
reasons that follow, I shall deny the Motion.
Complaint (ECF 1), plaintiff states that Farm Fresh Direct
has been registered as a limited liability corporation
(“LLC”) with the Maryland State Department of
Assessments and Taxation (“SDAT”) since December
22, 2016. ECF 1, ¶ 9. On June 7, 2017, plaintiff
registered with SDAT its ownership of the trade name
“Farm Fresh Direct Direct.” Id.
Plaintiff alleges that it has “worked to develop the
Farm Fresh Direct trade name and trademark by working to
create a network of providers inside and outside of Maryland,
” and by “working directly with suppliers
throughout the mid-Atlantic region to bring fresh, natural
and quality foods directly to consumers.” Id.
¶ 10. Further, plaintiff asserts that it uses the Farm
Fresh Direct trade name and trademark in interstate commerce.
to plaintiff, “on or about April 5, 2017, ” it
entered into an Independent Representative and Non-Compete
Agreement (“Agreement”) with Downey and Clipper
City. Id. ¶ 11. Pursuant to the Agreement,
Downey served as a representative salesperson for and on
behalf of plaintiff. Id. The Agreement forms the
basis for Count III, which pertains only to Downey and
Clipper City and is not at issue in this Memorandum.
asserts that, on or about April 25, 2017, “Downey and .
. . Sinsky filed with SDAT articles of organization for a
competing company with name [sic] intentionally confusing
with Farm Fresh Direct's, ‘Farm Fresh Direct Direct
Home Food Services, LLC” ECF 1, ¶ 12.
Additionally, plaintiff asserts that the “filings with
SDAT state that [Farm Fresh Home's] purpose is to sell
fresh all natural food plans and other household items to
residential customers.” Id. ¶ 12. Of
relevance here, plaintiff also alleges that “Sinsky is
the resident agent and incorporator” for Farm Fresh
Home. Id. ¶¶ 12-13.
plaintiff alleges that Downey and Clipper City
“attempt[ed] to open an account with [plaintiffs] meat
supplier.” Id. ¶ 15. And, “Downey
and Clipper City have retained contact information for
[plaintiffs] providers and clients, . . . and have created or
are seeking to create commercial relationships with them in
violation of the Agreement[, ] unfairly completing [sic] with
[plaintiff], including, through the use of the intentionally
confusing . . . ‘Farm Fresh Direct' name.”
Id. ¶ 16. Plaintiff adds: “Sinsky aided,
abetted and supported these and other violations of Farm
Fresh Direct's rights to the name Farm Fresh Direct
Direct . . . .” Id. ¶ 16.
Standard of Review
defendant may test the legal sufficiency of a complaint by
way of a motion to dismiss under Rule 12(b)(6). In re
Birmingham, 846 F.3d 88, 92 (4th Cir. 2017); Goines
v. Valley Cmty. Servs. Bd., 822 F.3d 159,
165-66 (4th Cir. 2016); McBurney v. Cuccinelli, 616
F.3d 393, 408 (4th Cir. 2010), aff'd sub nom.
McBurney v. Young, 569 U.S. 221 (2013); Edwards v.
City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999). A
Rule 12(b)(6) motion constitutes an assertion by a defendant
that, even if the facts alleged by a plaintiff are true, the
complaint fails as a matter of law “to state a claim
upon which relief can be granted.”
a complaint states a claim for relief is assessed by
reference to the pleading requirements of Fed.R.Civ.P.
8(a)(2). That rule provides that a complaint must contain a
“short and plain statement of the claim showing that
the pleader is entitled to relief.” The purpose of the
rule is to provide the defendant with “fair
notice” of the claims and the “grounds” for
entitlement to relief. Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555-56 (2007).
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.”
Twombly, 550 U.S. at 570; see Ashcroft v.
Iqbal, 556 U.S. 662, 684 (2009) (“Our decision in
Twombly expounded the pleading standard for
‘all civil actions' . . . .” (citation
omitted)); see also Willner v. Dimon, 849 F.3d 93,
112 (4th Cir. 2017). But, a plaintiff need not include
“detailed factual allegations” in order to
satisfy Rule 8(a)(2). Twombly, 550 U.S. at 555.
sure, federal pleading rules “do not countenance
dismissal of a complaint for imperfect statement of the legal
theory supporting the claim asserted.” Johnson v.
City of Shelby, ___ U.S. ___, 135 S.Ct. 346, 346 (2014)
(per curiam). Nevertheless, the rule demands more than bald
accusations or mere speculation. Twombly, 550 U.S.
at 555; see Painter's Mill Grille, LLC v. Brown,
716 F.3d 342, 350 (4th Cir. 2013). A complaint is
insufficient if it provides no more than “labels and
conclusions” or “a formulaic recitation of the
elements of a cause of action.” Twombly, 550
U.S. at 555. Rather, to satisfy the minimal requirements of
Rule 8(a)(2), the complaint must set forth “enough
factual matter (taken as true) to suggest” a cognizable
cause of action, “even if . . . [the] actual proof of
those facts is improbable and . . . recovery is very remote
and unlikely.” Twombly, 550 U.S. at 556
(internal quotations omitted).
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 Semenova v. Maryland Transit
Admin., 845 F.3d 564, 567 (4th Cir. 2017); Belmora,
LLC v. Bayer Consumer Care AG, 819 F.3d 697, 705 (4th
Cir. 2016); Houck v. Substitute Tr. Servs., Inc.,
791 F.3d 473, 484 (4th Cir. 2015); Kendall v.
Balcerzak, 650 F.3d 515, 522 (4th Cir. 2011), cert.
denied, 565 U.S. 943 (2011). But, a court is not
required to accept legal conclusions drawn from the facts.
See Papasan v. Allain, 478 U.S. 265, 286 (1986).
“A court decides whether [the pleading] standard is met
by separating the legal conclusions from the factual
allegations, assuming the truth of only the factual
allegations, and then determining whether those allegations
allow the court to reasonably infer” that the plaintiff
is entitled to the legal remedy sought. A Society Without
a Name v. Virginia, 655 F.3d 342, 346 (4th Cir. 2011),
cert. denied, 566 U.S. 937 (2012).
general, courts do not “resolve contests surrounding
the facts, the merits of a claim, or the applicability of
defenses” through a Rule 12(b)(6) motion. Edwards
v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999).
The purpose of the rule is to ensure that defendants are
“given adequate notice of the nature of a claim”
made against them. Twombly, 550 U.S. at 555-56. But,
“in the relatively rare circumstances where facts
sufficient to rule on an affirmative defense are alleged in
the complaint, the defense may be reached by a motion to
dismiss filed under Rule 12(b)(6).” Goodman v.
Praxair, Inc., 494 F.3d 458, 464 (4th Cir. 2007) (en
banc); accord Pressley v. Tupperware Long Term Disability
Plan, 533 F.3d 334, 336 (4th Cir. 2009); see also
U.S. ex rel. Oberg v. Penn. Higher Educ. Assistance
Agency, 745 F.3d 131, 148 (4th Cir. 2014). However,
because Rule 12(b)(6) “is intended [only] to test the
legal adequacy of the complaint”, Richmond,
Fredericksburg & Potomac R.R. Co. v. Forst, 4 F.3d
244, 250 (4th Cir. 1993), “[t]his principle only
applies . . . if all facts necessary to the affirmative
defense ‘clearly appear[ ] on the face of the
complaint.'” Goodman, 494 F.3d at 464
(quoting Forst, 4 F.3d at 250) (emphasis added in
alleges that Sinsky violated 15 U.S.C. § 1125(a)(1)(A)
and engaged in unfair and deceptive trade practices, in
violation of Maryland common law. ECF 1, ¶¶ 17-22,
23-26. At its core, plaintiff's contention is that
“Sinsky is the resident agent and incorporator”
of Farm Fresh Home (ECF 1, ¶¶ 12-13), and in that
capacity she “filed” the articles of organization
for Farm Fresh Home, creating a name for the “competing
company” that is “intentionally confusing”
because of its similarity to Farm Fresh Direct. ECF 1, ¶
Fresh Home is a limited liability company. As a threshold
matter, I must determine whether Sinsky is subject to suit in
light of Farm Fresh Home's status as a limited liability
well settled that “[a] corporation exists as a legal
entity separate and distinct from its corporate
shareholders.” Cancun Adventure Tours, Inc. v.
Underwater Designer Co., 862 F.2d 1044, 1047 (4th Cir.
1988); see Johnson v. Flowers Indus., Inc., 814 F.2d
978, 980 (4th Cir. 1987). Notably, a corporation is a
“‘creature of legal fiction, '” and
“‘a corporation must of necessity act through its
agents . . . .'” Southern Management Corp. v.
Taha, 378 Md. 461, 480, 836 A.2d 627, 638 (2003)
concept of a corporation as a separate legal entity “is
expressed by the colorful metaphor of the corporate veil,
which presumes that acts of the corporation are not acts of
the shareholder.” Johnson, 814 F.2d at 980.
The corporate veil doctrine “is a basic attribute of
the corporate form; it encourages business investment and
fosters stability in commercial transactions.”
Cancun Adventure, 862 F.2d at 1047. And, in Maryland
“the fiction of the wholly ...