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Element Fleet Corp. v. Forklift Exchange, Inc.

United States District Court, D. Maryland

April 18, 2019

Element Fleet Corporation f/k/a PHH Vehicle Management Services, LLC
v.
Forklift Exchange, Inc

          MEMORANDUM

          Catherine C. Blake United States District Judge.

         This dispute arises out of a contract between Element Fleet Corporation ("Element") and Forklift Exchange, Inc ("Forklift") for the consignment of two pieces of equipment. Currently pending before the court is Forklift's motion to dismiss the complaint. For the reasons outlined below, the court will deny Forklift's motion. The issues have been briefed and no oral argument is necessary. See Local Rule 105.6 (D. Md. 2018).

         BACKGROUND

         On December 18, 2012, Element and Forklift entered into a Consignment Agreement (the "Agreement") in Maryland. (Compl. ¶¶ 5-6, ECF No. 1). In 2016, in accordance with the Agreement, Element delivered two lifts-a Yale Lift Model PI 100-48 (the "PI 100 Model Lift") and a Yale Lift Model P500-48 (the "P500 Model Lift")-to Forklift. (Id. ¶ 10). These lifts were given to Forklift for a consignment period. (Id. ¶ 7). During this period, Forklift agreed to market the lifts to potential customers. (Id., ). If a buyer was found, Forklift was entitled to purchase the lifts from Element for a "predetermined set price established by [Element] prior to [Forklift] selling" the lifts to the buyer. (Id. ¶ 8). Element alleges that Forklift agreed to purchase prices of $150, 000.00 for the PI 100 Model Lift, and $125, 000.00 for the P500 Model Lift. (Id. ¶ 11). But Element alleges that Forklift has neither paid the agreed upon purchase price, nor returned the lifts to Element, despite repeated requests from Element to do so. (Id. ¶¶ 12-14).

         On July 27, 2018, Element initiated this suit against Forklift, alleging: (1) breach of contract (Count I); and (2) conversion (Count II). (Id. ¶¶ 16-29). Element seeks monetary damages. (Id. ¶¶ 22, 29).

         STANDARD OF REVIEW

         When ruling on a motion under Rule 12(b)(6), the court must "accept the well-pled allegations of the complaint as true," and "construe the facts and reasonable inferences derived therefrom in the light most favorable to the plaintiff." Ibarra v. United States, 120 F.3d 472, 474 (4th Cir. 1997). "Even though the requirements for pleading a proper complaint are substantially aimed at assuring that the defendant be given adequate notice of the nature of a claim being made against him, they also provide criteria for defining issues for trial and for early disposition of inappropriate complaints." Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. 2009). "The mere recital of elements of a cause of action, supported only by conclusory statements, is not sufficient to survive a motion made pursuant to Rule 12(b)(6)." Walters v. McMahen, 684 F.3d 435, 439 (4th Cir. 2012) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). To survive a motion to dismiss, the factual allegations of a complaint "must be enough to raise a right to relief above the speculative level on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal citations omitted). "To satisfy this standard, a plaintiff need not 'forecast' evidence sufficient to prove the elements of the claim. However, the complaint must allege sufficient facts to establish those elements." Walters, 684 F.3d at 439 (citation omitted). "Thus, while a plaintiff does not need to demonstrate in a complaint that the right to relief is 'probable,' the complaint must advance the plaintiffs claim 'across the line from conceivable to plausible.'" Id. (quoting Twombly, 550 U.S. at 570).

         In general, a court may not consider extrinsic evidence when resolving a Rule 12(b)(6) motion. See Chesapeake Bay Found., Inc. v. Severstal Sparrows Point, LLC, 794 F.Supp.2d 602, 611 (D. Md. 2011). But there are several exceptions to this rule. A court may consider documents attached to the complaint. See Fed. R. Civ. P. 10(c). A court may also consider documents attached to the motion to dismiss if the documents are "integral to and explicitly relied on in the complaint and [if] the plaintiffs do not challenge [the documents'] authenticity." Am. Chiropractic Ass'n, Inc. v. Trigon Healthcare Inc., 367 F.3d 212, 234 (4th Cir. 2004) (quoting Phillips v. LCI Int'l Inc., 190 F.3d 609, 618 (4th Cir. 1999)); see Blankenship v. Manchin, 471 F.3d 523, 526 n.l (4th Cir. 2006). A court may also consider documents referred to and relied upon in the complaint, even if those documents are not attached to the complaint as exhibits. New Beckley Min. Corp. v. Int'l Union, United Mine Workers, 18 F.3d 1161, 1164 (4th Cir. 1994) (citing Cortec Indus., Inc. v. Sum Holding, L.P., 949 F.2d 42, 47-48 (2d Cir. 1991)). And, if any of these properly considered extra-pleading materials conflict with the allegations in the complaint, the extra-pleading materials prevail. Fayetteville Investors v. Commercial Builders, Inc., 936 F.2d 1462, 1465 (4th Cir. 1991); Fare Deals Ltd. v. World Choice Travel.Com, Inc., 180 F.Supp.2d 678, 683 (D. Md. 2001).

         ANALYSIS

         Forklift argues that the court should dismiss Element's complaint under the doctrine of forum non conveniens, and, alternatively, that the court should dismiss the complaint because Element fails to state a claim for either breach of contract or conversion. The court considers these arguments in turn.

         Forklift argues that the court should dismiss the complaint under the doctrine of forum non conveniens because the Agreement contains a forum selection clause that elects the state court of "Cook County, Illinois" as the sole venue for resolution of disputes arising out of the Agreement. (Mem. P. & A. Supp. Def.'s Mot. Dismiss ["Def.'s Mot"] at 3-6, ECF No. 7-1; Def.'s Mot. Ex A ["Purchase Order"], ECF No. 7-2).[1] To assess the merits of Forklift's argument, the court must first determine what contract governs the parties' relationship, and whether that contract contains a forum selection clause.

         Forklift attached a Purchase Order to its motion, which it argues constitutes the agreement between the parties. (Purchase Order). And Forklift argues that "Terms and Conditions of Sale," which are available on Forklift's website and include a forum selection clause for Cook County, Illinois, are incorporated into the Purchase Order. (Def.'s Mot. at 4). But Element disputes both the authenticity and the relevance of the Purchase Order. Specifically, Element argues that the Purchase Order is not the Agreement between the parties that forms the basis for this suit. Instead, the Purchase Order is two separate documents that Forklift has strung together that are "unauthenticated, undated and unexecuted" and "make[] absolutely no sense in the context of this case." (PL's Resp. Opp'n Def.'s Mot ["PL's Resp."] at 3-4, ECF No. 8). Element argues that the Agreement between the parties was a consignment agreement-Element retained legal title over the two lifts until Forklift found a buyer and purchased the lifts from Element. Element contends, therefore, that the Purchase Order, which presupposes that Forklift is the seller rather than the buyer of the lifts, does not reflect the consignment arrangement. Because this dispute arises at the motion to dismiss stage, and Element disputes the authenticity of the Purchase Order, the court will' not consider it in resolving Forklift's motion. See American Chiropractic, 367 F.3d at 234; see also Kerr v. Marshall University Board of Governors, 824 F.3d 62, 68 n.l (4th Cir. 2016) (citing American Chiropractic, 367 F.3d at 234)).

         Forklift also attaches an email exchange to its motion, which it argues indicates Element's "assent in writing" to the terms and conditions of Forklift's Purchase Order. (Def.'s Reply Ex A ["Flaska Aff."] at 2, ECF No. 9-1; Def.'s Mot. Ex B ["Email Exchange"], ECF No. 7-3). In this email exchange, an Element representative writes that Element would accept $225, 000.00 for the two lifts-$150, 000.00 for the PI 100 Model Lift and $75, 000.00 for the P500 Model Lift. (Email Exchange at 1). This conflicts with the allegation in Element's complaint that Forklift agreed to pay 3275, 000.00 for the two lifts. (Compl. ¶ 11). Element asks the court to strike the emails as impermissible settlement discussions under Federal Rule of Evidence 408. (PI. 's Resp. at 5). Upon review, it is not clear whether the emails contain settlement discussions, or instead contain price discussions as contemplated under the parties' Agreement.

         Regardless, to resolve Forklift's motion, the court need only decide whether Element's complaint states plausible claims for relief. Whether the emails evidence settlement discussions or price negotiations, they do not alter Element's underlying allegation that a contractual obligation existed, and that Forklift breached that obligation. At most, the emails would inform the court's assessment of damages if Element establishes its claim of breach of contract. Accordingly, the court's analysis focuses on Element's complaint and the Agreement that Element attached to its responsive briefing, (Pl.'s Resp. Ex 1 ["Agreement"], ECF No. 8-1), which forms the legal basis for Element's pleadings. New Beckley Min. Corp. v. Int'l Union, United Mine Workers,18 F.3d 1161, 1164 (4th Cir. 1994) (concluding that, in resolving a motion to dismiss, a court may consider documents referred to and relied, upon in the complaint, even if ...


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