United States District Court, D. Maryland
Charles B. Day, United States Magistrate Judge
this Court is Defendant Liteye Systems, Inc.'s Motion to
Dismiss Tribalco, LLC's Complaint pursuant to Federal
Rule of Civil Procedure 12(b)(6) (“Defendant's
Motion”)(ECF No. 22). The Court has reviewed
Defendant's Motion, and the opposition and reply thereto.
No. hearing is deemed necessary. See Local Rule
105.6 (D. Md.). For the reasons presented below, the Court
hereby GRANTS Defendant's Motion.
brings suit alleging several causes of action, namely: breach
of contract; constructive fraud; and restraint of trade.
Plaintiff also seeks relief by way of declaratory judgment
and a permanent injunction. Attached to the Complaint is a
document which the parties view as central to this dispute,
titled “Exclusive Teaming and Distributorship
Agreement” (“ETDA”). Id. The
parties have competing views of the breadth, scope and
duration of the ETDA.
is a “telecommunications and global integrated
technology services and solutions company.” Compl.
¶ 7. Defendant is a “producer of surveillance
systems for the protection of critical military
infrastructure, whose products include . . . Anti-UAV Defense
Systems (“AUDS”).” Compl. ¶ 8.
“On June 15, 2016, the Joint Improvised Threat Defense
Agency of the United States Department of Defense
(“JIDA”)” was seeking to purchase
“ten to fifteen AUDS.” Compl. ¶ 9. The
parties agreed this was an “opportunity” for them
to pursue. Compl. ¶ 10. “On July 22, 2016, JIDA
directed the U.S. Air Force Cycle Management Center
(“AFLCMC”) to issue a Letter of Intent” to
Plaintiff for the purchase of the first four AUDS. Compl.
¶ 11. Five days later, the parties signed the ETDA.
Compl. ¶ 12.
August 30, 2016, AFLCMC awarded a contract to Plaintiff for
the production of three AUDS, and two spare units. Compl.
¶ 19. On September 6, 2016, the parties entered into a
subcontract (“Subcontract”) by which D would
produce and provide the AUDS and spare parts. Compl. ¶
20. Plaintiff contends that the “ETDA was broader in
scope, time and subject matter than the Subcontract.”
Compl. ¶ 21. The Subcontract expired on December 31,
2016. Compl. ¶ 23.
Defendant was the producer of AUDS, the ETDA made Plaintiff
the “exclusive distributor of AUDS to the
AFLCMC.” Compl. ¶ 15. In 2017, Plaintiff contends
that it took various measures to advance the parties'
relationship and to obtain additional contracts however,
Defendant effectively refused to cooperate. Compl.
¶¶ 27-30. On February 27, 2017, Defendant sent
Plaintiff a “cease and desist” letter disavowing
“the ETDA, asserting that the ETDA had been superseded
by the Subcontract, ” and demanded that Plaintiff
“cease any communications with third parties concerning
the procurement of AUDS supplied” by Defendant. Compl.
¶ 31. In August 2017, when a new opportunity arose for
the production and sale of AUDS, Defendant refused to
cooperate with Plaintiff to pursue the proposal. Compl.
Standard of Review
purpose of a Rule 12(b)(6) motion is to test the sufficiency
of a complaint.” McBurney v. Cuccinelli, 616
F.3d 393, 408 (4th Cir. 2010) (citation omitted). “To
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, ‘to state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937,
1949 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)). “A court decides whether this
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 relief. A Society Without A Name v.
Virginia, 655 F.3d 342, 346 (4th Cir. 2011). Dismissal
“is inappropriate unless, accepting as true the
well-pled facts in the complaint and viewing them in the
light most favorable to the plaintiff, the plaintiff is
unable to ‘state a claim to relief.'”
Brockington v. Boykins, 637 F.3d 503, 505-06 (4th
Cir. 2011) (citation omitted).
ruling on a motion to dismiss under Fed.R.Civ.P. 12(b)(6),
the Court “should accept as true all well-pleaded
allegations and should view the complaint in a light most
favorable to the plaintiff”; the motion “should
not be granted unless it appears certain that the plaintiff
can prove no set of facts which would support its claim and
would entitle it to relief.” Mylan Labs., Inc. v.
Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993). The court
“also may consider documents attached to the complaint
and the motion to dismiss if they are authentic and central
to the complaint.” Guzman v. D & S Capital,
LLC, Civ. No. MAB 14-CV-01799, 2015 WL 772797, at *2 (D.
Md. Feb. 20, 2015) (citing Philips v. Pitt Cnty.
Mem'l Hosp., 572 F.3d 176, 180 (4th Cir.
2009) (citations omitted)).
The Breach of Contract Claim
first cause of action rests exclusively on the alleged breach
of the ETDA. Compl. ¶ 48. Since the Court is considering
a motion to dismiss, it “may also consider documents
attached to the complaint, see Fed.R.Civ.P. 10(c), as well as
those attached to the motion to dismiss, so long as they are
integral to the complaint and authentic.” Philips
v. Pitt Cnty. Mem'l Hosp., 572 F.3d 176, 180
(4th Cir. 2009). There is no dispute but that the
Subcontract expired by its terms on December 31, 2016. Compl.
¶ 23. The opening issue is whether the ETDA was clear in
its terms, imposing upon the parties an obligation to conduct
their affairs in accordance with said terms. The ETDA
contains a provision choosing Maryland law for its
application. “This Agreement shall be governed by and
subject to the jurisdiction of the laws of the State of
Maryland without regard to any of its choice of law
provisions.” ETDA, ¶ 13. Accordingly, the
substantive contract law of Maryland applies.
Maryland law sets forth the pleading standard for a breach of
contract claim. Such a claim “must of necessity allege
with certainty and definiteness facts showing a
contractual obligation owed by the defendant to the plaintiff
and a breach of that obligation by defendant.”
Polek v. J.P. Morgan Chase Bank, N.A., 424 Md. 333,
416 (2012) (quoting Cont'l Masonry Co. v. Verdel
Constr. Co., 279 Md. 476, 480 (1977). The
“contractual obligation” of Defendant is
expressed in the ETDA. For purposes of Plaintiff's breach
of contract claim, the Complaint references the ETDA in
paragraphs 12-17, 21, 31-32, and 40-48. The only paragraphs
in the Complaint that provide factual texture about the ETDA
(as opposed to argument or conclusions) are paragraphs 12-16,
and 40. As to these paragraphs, Defendant really takes issue
with only two, paragraphs 14 and 40, set forth below:
14. The purpose of the ETDA was to pursue the award of
contracts to Tribalco for the procurement of AUDS by the