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Floyd v. Howard Bank

United States District Court, D. Maryland

April 18, 2019

JOHN M. FLOYD & ASSOCIATES, INC. Plaintiff,
v.
HOWARD BANK Defendant.

          MEMORANDUM OPINION

          RICHARD D. BENNETT UNITED STATES DISTRICT JUDGE

         Plaintiff John M. Floyd & Associates, Inc. ("JMFA" or "Plaintiff) brings this action against Defendant Howard Bank ("Howard" or "Defendant"), alleging that Defendant breached the terms of the September 2015 written contract with Plaintiff ("ODP Agreement"). Specifically, Plaintiff brings this action under Breach of Contract, Quantum Meruit, Conversion, and Declaratory Judgment.

         Currently pending before this Court is Defendant's Motion for Partial Dismissal of Plaintiffs Original Complaint. (ECF No. 9.) The parties' submissions have been reviewed and no hearing is necessary. See Local Rule 105.6 (D. Md. 2018). For the following reasons, Defendant's Motion for Partial Dismissal of Plaintiffs Original Complaint (ECF No. 9) is DENIED IN PART and GRANTED IN PART. Specifically, the Motion to Dismiss is denied with respect to the quasi-contract claim and granted with respect to the conversion and declaratory judgment claims.

         BACKGROUND

         In a ruling on a motion to dismiss, this Court must accept the factual allegations in the plaintiffs complaint as true and construe those facts in the light most favorable to the plaintiffs. See, e.g., Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th Or. 1999).

         Howard, a local Maryland bank, entered into discussions with JMFA, a Texas corporation, concerning an "Overdraft Privilege Program" ("ODP") resulting in a proposal in September 2015. In exchange for implementing ODP, Howard agreed to pay JMFA a percentage of any income over the baseline for existing accounts as well as any new accounts that may subsequently be added. Howard agreed to a term of 36 months for the ODP Agreement, which would begin on the first month of implementation. Howard also agreed that if it chose to terminate prior to the conclusion of 36 months, it would owe JMFA fees based upon the remaining months. In September 2015, Howard and JMFA entered into a contract agreeing to install ODP pursuant to these conditions.

         In November 2015, JMFA presented Howard with a baseline as well as instructing Howard as to installation, implementation, and training. Following approval, Howard implemented JMFA's recommendations on April 1, 2016. In October, Howard began sharing revenues with JMFA as required by the ODP Agreement. One year later, in October 2017, Howard advised JMFA of its intent to acquire First Mariner Bank, which was finalized with the merger in March 2018. JMFA presented a new baseline for fees to Howard on April 16, 2018 based upon Howard's acquisition of First Mariner Bank. Howard approved the revisions on April 25, 2018.

         On May 17, 2018, Howard sent an email to JMFA cancelling the ODP Agreement. Following termination, Howard offered to pay the ODP fees for the months remaining on the contract for the legacy Howard Bank accounts, but not for the newly acquired First Mariner Bank accounts that were also profiting from the implementation of ODP.

         JMFA filed suit in this Court on September 18, 2018. (Compl., ECF No. 1.) Howard filed the instant Motion for Partial Dismissal for Failure to State a Claim on October 19, 2018. (ECF No. 9.) For reasons as stated herein, Howard's motion is DENIED IN PART and GRANTED IN PART. Specifically, the Motion to Dismiss is denied with respect to the quasi-contract claim and granted with respect to the conversion and declaratory judgment claims.

         STANDARD OF REVIEW

         Rule 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 entided to relief." Fed.R.Civ.P. 8(a)(2).

         To 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." BellAtl, Corp. v. Tmmbly, 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, LL.C v. Brown, 716 F.3d 342, 350 (4th Cir. 2013).

         In reviewing a Rule 12(b)(6) motion to dismiss, a court "accepts the facts as alleged" in the Plaintiffs complaint. Quintana v. City of Alexandria, et al, __ Fed.Appx. __, No. 16-1630, 2017 WL 2438774, at *1 (4th Cir. June 6, 2017) (citing LeSeur-Richmond Slate Corp. v. Fehrer,666 F.3d 261, 264 (4th Cir. 2012)); Semenova v. Maryland Transit Admin.,845 F.3d 564, 567 (4th Cir. 2017). "At the motion to dismiss stage, [the court must] accept as true all of the well-pleaded allegations and view the complaint in the light most favorable to [Plaintiff]." Id. 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 ("Threadbare recitals of the ...


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