United States District Court, D. Nevada
before the court is a joint motion to dismiss filed by
defendants TruFusion Yoga, LLC (“TFY”), Michael
Borden (“Borden”), Martin Hinton
(“Hinton”), TruFusion LLC (“TF”), and
TruFusion Franchising LLC (“TFF”) (collectively,
as “defendants”). (ECF No. 38). Plaintiff Seth
Manheimer (“plaintiff” or
“Manheimer”) filed a response (ECF No. 44), to
which defendants replied (ECF No. 45).
before the court is Plaintiff's motion to dismiss. (ECF
No. 55). TFY, TF, and TFF (collectively, as
“counterclaimants”) filed a response (ECF No.
56),  to which plaintiff replied (ECF No. 57). .
. . . . .
Yoga (“TFY”) provides fitness classes in the Las
Vegas area. TFY owns federal trademarks related to the
TruFusion brand. (ECF No. 24 at 13). Steven Gregory
(“Gregory”), Judiah Hoffman
(“Hoffman”), and Jeff Starr (“Starr”)
formed TFY on March 20, 2013. (ECF No. 24 at 6). Gregory
dealt with organizational needs; Hoffman dealt with
operational needs; Starr was the primary financier. (ECF No.
24 at 6).
2013, Borden purchased Starr's membership interest in TFY
and plaintiff purchased a 1% interest in TFY. In July 2013,
Borden, Hoffman, Gregory, Hinton and plaintiff entered into
an operating agreement, which gave managers the authority to
act on behalf of TFY. (ECF No. 24 at 7).
alleges that during March through May of 2014, TFY bought
Gregory's and Hoffman's interests in TFY. (ECF No. 24
at 9). Thereafter, plaintiff and Borden discussed
restructuring the ownership and management of TFY and
recapturing Gregory's and Hoffman's ownership
interests. (ECF No. 24 at 8). According to plaintiff, he and
Borden orally agreed that they, as partners, would have equal
interests in TFY. (ECF No. 24 at 9-10). Plaintiff drafted a
revised operating agreement memorializing these orally agreed
upon terms. (ECF No. 24 at 9). The revised operating
agreement, however, was never signed and executed. (ECF No.
24 at 12).
March 12, 2015, Borden registered TF, listing himself as its
sole officer, and TFF, listing TF as its sole officer. (ECF
No. 24 at 12-13). Plaintiff alleges that Borden created TF
and TFF to divert TFY's business opportunities thereto by
entering into sham agreements, wherein TF and TFF licensed
TFY's trademark rights to licensees in exchange for an
initial payment and royalties. (ECF No. 24 at 13-15).
September 16, 2016, plaintiff filed the original complaint
(ECF No. 1), which he later amended on October 28, 2016 (ECF
No. 24). In the amended complaint, plaintiff alleges,
individually and on behalf of TFY, seventeen causes of
action: (1) & (2) breach of loyalty against Borden and
Hinton; (3) constructive fraud against Borden and Hinton; (4)
breach of operating agreement against Borden, Hinton, and
TFY; (5) breach of oral agreement against Borden, Hinton, and
TFY; (6) declaratory judgment against Borden and Hinton; (7)
& (8) accounting and unjust enrichment against TF, and TFF;
(9) money owed; (10) intentional interference with
prospective economic advantage against Borden, Hinton, TFF,
and TF; (11) common law conspiracy against Borden and Hinton;
(12) trademark infringement under 15 U.S.C. § 1114
against TFF; (13) trademark counterfeiting under 15 U.S.C.
§ 1116 against TFF; (14) false designation of origin and
unfair competition under 15 U.S.C. § 1125(a) against
TFF; (15) fraud against Borden; (16) dissolution of TruFusion
LLC; and (17) rescission against TF and TFF. (ECF No. 24).
defendants' joint motion, defendants move to dismiss
claims (2), (3), (8), (10), (12), (13), (14), (16), and (17)
of Plaintiff's amended complaint (ECF No. 24). (ECF No.
October 27, 2016, counterclaimants TFY, TF, and TFF filed a
counterclaim and “third-party
complaint” (ECF No. 19), which they later amended
(ECF No. 54-1) on January 3, 2017. In the amended
counterclaim, counterclaimants allege four causes of action
against plaintiff: (1) abuse of process; (2) intentional
interference with prospective economic relations; (3)
conversion; and (4) breach of fiduciary duty. (ECF No.
Plaintiff's motion, he moves to dismiss claims (1), (2),
and (4) of the amended counterclaim (ECF No. 54-1). (ECF No.
court will address each as it sees fit.
may dismiss a complaint for “failure to state a claim
upon which relief can be granted.” Fed.R.Civ.P.
12(b)(6). A properly pled complaint must provide “[a]
short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2);
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555
(2007). While Rule 8 does not require detailed factual
allegations, it demands “more than labels and
conclusions” or a “formulaic recitation of the
elements of a cause of action.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citation omitted).
allegations must be enough to rise above the speculative
level.” Twombly, 550 U.S. at 555. Thus, to
survive a motion to dismiss, a complaint must contain
sufficient factual matter to “state a claim to relief
that is plausible on its face.” Iqbal, 556
U.S. at 678 (citation omitted).
Iqbal, the Supreme Court clarified the two-step
approach district courts are to apply when considering
motions to dismiss. First, the court must accept as true all
well-pled factual allegations in the complaint; however,
legal conclusions are not entitled to the assumption of
truth. Id. at 678-79. Mere recitals of the elements
of a cause of action, supported only by conclusory
statements, do not suffice. Id. at 678.
the court must consider whether the factual allegations in
the complaint allege a plausible claim for relief.
Id. at 679. A claim is facially plausible when the
Plaintiff's complaint alleges facts that allow the court
to draw a reasonable inference that the defendant is liable
for the alleged misconduct. Id. at 678.
the complaint does not permit the court to infer more than
the mere possibility of misconduct, the complaint has
“alleged-but not shown-that the pleader is entitled to
relief.” Id. (internal quotation marks
omitted). When the allegations in a complaint have not
crossed the line from conceivable to plausible,
plaintiff's claim must be dismissed. Twombly,
550 U.S. at 570.
Ninth Circuit addressed post-Iqbal pleading
standards in Starr v. Baca, 652 F.3d 1202, 1216 (9th
Cir. 2011). The Starr court stated, in relevant
First, to be entitled to the presumption of truth,
allegations in a complaint or counterclaim may not simply
recite the elements of a cause of action, but must contain
sufficient allegations of underlying facts to give fair
notice and to enable the opposing party to defend itself
effectively. Second, the factual allegations that are taken
as true must plausibly suggest an entitlement to relief, such
that it is not unfair to require the opposing party to be
subjected to the expense of discovery and continued
Id. . . . . . .
Defendants' Motion to ...