United States District Court, D. Maryland
MEMORANDUM OPINION
STEPHANIE A. GALLAGHER UNITED STATES MAGISTRATE JUDGE
On July
27, 2018, Plaintiffs Ultimate Outdoor Movies, LLC and Laura
Landers (“Plaintiffs”) filed suit against
Defendants Charles Hunter, Matthew Dias, and FunFlicks
Audiovisuals (collectively “the California
Defendants”); Todd Severn and FunFlicks, LLC
(collectively, “the Severn Defendants”); and
James Gaither and NATJAY, LLC (collectively, “the
Gaither Defendants”). ECF 1. On April 10, 2019, the
Severn Defendants filed a Third-Party Complaint and a Motion
for Preliminary Injunction against Darrell Landers
(“Darrell Landers”) and his company, LND
Technologies, LLC (“LND”) (collectively,
“the Third-Party Defendants”). ECF 105, 106.
Presently
pending is the Third-Party Defendants' Motion to Dismiss
the Third-Party Complaint. ECF 119. The Severn Defendants
opposed the motion, ECF 132, and the Third-Party Defendants
filed a Reply, ECF 139. Also pending is the Severn
Defendants' Motion for Preliminary Injunction against the
Third-Party Defendants. ECF 106. The Third-Party Defendants
opposed the motion, ECF 118, and the Severn Defendants filed
a Reply, ECF 131.
The
Court declines to hold a hearing on the Severn
Defendants' Motion for Preliminary Injunction. A
preliminary injunction hearing is “not required when no
disputes of fact exist and the denial of the motion is based
upon the parties' written papers.” Fundamental
Admin. Servs., LLC v. Anderson, Civil No. JKB-13-1708,
2015 WL 2340832, at *1 (D. Md. May 13, 2015) (citing
Aoude v. Mobil Oil Corp., 862 F.2d 890, 893-94 (1st
Cir. 1988) (“an evidentiary hearing is not an
indispensable requirement when a court allows or refuses a
preliminary injunction”)). “[P]reliminary
injunctions are denied without a hearing, despite a request
for one by the movant, when the written evidence shows the
lack of a right to relief so clearly that receiving further
evidence would be manifestly pointless.” 11A Charles
Alan Wright, Arthur R. Miller, & Mary Kay Kane,
Federal Practice and Procedure § 2949 (3d ed.
2019). Here, the parties' written submissions do not
raise a question of fact that must be resolved before the
Court may rule on the Severn Defendants' motion. Thus, no
hearing is necessary to resolve the motions. See
Local Rule 105(6) (D. Md. 2018).
For the
reasons stated below, I shall deny both pending motions.
I.
Background[1]
This
case is based on a dispute over an outdoor movie business
known as FunFlicks. ECF 105 ¶ 17. Defendant Todd Severn
(“Severn”) is the owner of Defendant FunFlicks,
LLC of Maryland (“FF-Severn”). Id.
¶ 2. FF-Severn owned the FunFlicks brand for more than
twelve years, until January 2013. Id. ¶ 18.
During this time, FF-Severn licensed the FunFlicks brand to
licensees nationwide. Id. ¶ 19. In or about
2008, FF-Severn entered a license agreement with Darrell
Landers for the Austin, Texas territory. Id. ¶
20. On or about June 18, 2010, Darrell Landers registered Fun
Flicks Outdoor Movies of Texas, Inc. (“UOM”) as
an entity in Texas. Id. ¶ 21. In 2011, Darrell
Landers was a 60% owner of UOM, and his wife, Laura Landers,
was a 40% owner.[2] Id. ¶ 22.
In or
about 2012, Darrell Landers registered another entity,
FunFlicks, Inc., in Texas, which was renamed LND
Technologies, LLC on or about November 9, 2018
(“LND”).[3] Id. ¶¶ 4, 6. Also in
2012, Darrell Landers and Laura Landers entered additional
licensing agreements, through UOM, for additional cities,
including Dallas, Houston, San Antonio, Oklahoma City, Tulsa,
Memphis, Nashville, and Huntsville. Id. ¶¶
23, 24. On or about December 31, 2012, Darrell Landers,
through LND, entered into an Asset Sale and Purchase
Agreement (“the APA”) to purchase the FunFlicks
brand from FF-Severn for $2.5 million. Id. ¶
25. Under the APA, FF-Severn held a Security Agreement, and
LND made a down payment to FF-Severn, agreeing to pay the
remaining balance of the $2.5 million purchase price under a
Seller Take Back Financing Promissory Note (“the
Note”). Id. ¶¶ 26, 27.
In or
around 2016, Laura Landers became the sole owner of UOM, and
Darrell Landers became the “majority and/or sole
owner” of LND. Id. ¶ 31. Around the same
time, Darrell Landers and Laura Landers signed a 10-year
non-monetary agreement between UOM and LND. Id.
¶ 32. In October, 2017, the Severn Defendants allege
that LND defaulted on the Note, with roughly $2 million still
owed. Id. ¶ 33. Thereafter, FF-Severn and LND
began negotiating a restructuring of the APA. Id.
¶ 34. On or about December 21, 2017, after negotiations
had deteriorated, FF-Severn exercised its rights under the
Note to take back the FunFlicks brand from LND. Id.
¶¶ 35-46.
Subsequently,
FF-Severn sold FunFlicks to FunFlicks Audiovisuals
(“FF-AV'), a Defendant in the underlying lawsuit,
to satisfy the $2 million unpaid by LND, leaving a deficiency
of approximately $500, 000.00. Id. ¶ 47. On
March 3, 2018, the Severn Defendants executed a Release and
Settlement Agreement (“the Release”) with Darrell
Landers and LND, settling their dispute over the APA.
Id. ¶ 52; ECF 105-1. The Release, attached as
an exhibit to the Third-Party Complaint, was signed by
Darrell Landers, individually and on behalf of LND, and by
Severn, individually and on behalf of FF-Severn, all of whom
are defined in the Release as “the Parties.” ECF
105-1 at 2-11. The “Mutual General Release”
provision provides,
Each of the parties, through the undersigned, on behalf of
themselves and their successors in interest, assigns,
officers, shareholders, agents, employees, and partners,
irrevocably and unconditionally releases and discharges each
of the Parties of any and all contracts, agreements,
promises, indebtedness, obligations, sums owed, liability,
claims, and/or causes of action, including any claims for
attorneys' fees, that they, he, or it may have, whether
any of the foregoing are known or unknown, that in any way
arise from or relate to the APA, the Seller Take Back
Financing Note, the Security Agreement, and any associated
agreements and instruments, the Default Notice, the Sale
Notice, the Third Party Sale, the Deficiency, or any
decision, event, act, transaction, agreement, contract, or
occurrence that took place or was executed prior to the date
of this Agreement. The Parties understand that this mutual
release contained in this Agreement includes all claims they
have ever had or may now have against any other Party up to
the date of this Agreement, including but not limited to, all
claims arising out of or related [sic] the Parties'
business, relationship and/or agreements, all claims for
breach of express or implied contract, and all other federal,
state, or local statutory and/or common law claims. . . . Any
and all claims or potential claims or causes of action that
either Party has, may have, or that may arise in the future
from events occurring after the date of this Agreement are
not meant to be covered by the mutual general release of this
Agreement. This is a general release for acts,
agreements, events, and claims between the parties predating
this Agreement.
Id. ¶ 8; ECF 105 ¶ 55. In addition, the
Third-Party Defendants made affirmative covenants,
representations, and warranties, including:
[T]he Landers Entities will not voluntarily aid, abet,
collude with, or conspire with, any individual or entity with
respect to bringing or litigating any claim or cause of
action against the Severn Entities based on any conduct or
event that occurred prior [to] the Effective Date of this
Agreement…
ECF 105-1 ¶ 4(e); ECF 105 ¶ 54.
On or
about June 14, 2018, Darrell Landers sent an email to
“darrell@funflicks.com, ” posing as a client
seeking FunFlicks services. ECF 105 ¶ 60. On July 27,
2018, Laura Landers and UOM filed the underlying lawsuit
against the Severn Defendants, among others, alleging damage
to UOM's business, as a result of the Severn Defendants
“actions and/or inactions involving their take back and
re-sale of FunFlicks to FF-AV.” Id.
¶¶ 57, 58; see ECF 1. Plaintiffs filed an
Amended Complaint on November 8, 2018, which included
references to the Third-Party Defendants, as well as exhibits
of emails and text messages from Darrell Landers regarding
the APA negotiations, dated prior to March 3, 2018. ECF 105
¶¶ 69-74; see ECF 21. In ...