United States District Court, W.D. Arkansas, Fayetteville Division
ACTIVE MARKETING GROUP, INC. PLAINTIFF
EB BRANDS HOLDINGS, INC., d/b/a EB Sport Group, EB Brands, E&B HK Limited, EB Giftware, Sports and Leisure Tech, and Sportline DEFENDANT
MEMORANDUM OPINION AND ORDER
TIMOTHY L. BROOKS, UNITED STATES DISTRICT JUDGE
before the Court are Plaintiff Active Marketing Group,
Inc.'s ("Active") Partial Motion to Dismiss
Defendant's Second Amended Counterclaim (Doc. 31) and
Memorandum of Law in Support (Doc. 32), and Defendant EB
Brands Holdings, Inc.'s ("EB") Memorandum in
Response (Doc. 33). For the reasons given below, Active's
Motion is GRANTED.
to the Amended Complaint in this case, Active and EB have
been doing business with each other since 1989. (Doc. 20,
¶ 10). Specifically, Active has been acting as a sales
representative for EB, "placing EB's products for
sale with retailers like Walmart." Id. The
subject of this lawsuit is the most recent sales
representative agreement ("the Contract") between
the parties, into which they entered on December 31, 2014.
Id. at ¶ 11; see also Doc. 1-1 (the
Contract). Active alleges that on April 1, 2016, EB breached
the Contract by unilaterally terminating it without adequate
notice or good cause, attempting to restrict Active's
ability to communicate with Walmart, and withholding sales
commissions that were owed to Active by EB under the
Contract. See Doc. 20, ¶¶ 28-41; see
also Doc. 1-2 (the termination letter fronn EB to
Active). Active's Amended Complaint sets forth two counts
premised on these allegations: breach of contract, and
violation of Ark..Code Ann. § 4-70-301, et seq.
(Doc. 20, ¶¶ 42-55). EB has answered Active's
Amended Complaint, and asserted four counterclaims for
accounting, replevin, declaratory judgment, and breach of
contract. (Doc. 28, ¶¶ 56-80).
has moved under Fed.R.Civ.P. 12(b)(6) for this Court to
dismiss EB's fourth counterclaim for breach of contract,
'' on the grounds that EB has failed to plead
sufficient facts to plausibly show that it is entitled to
relief. Naturally, EB disagrees. Active's Motion and
EB's opposition have been fully briefed, and the Motion
is now ripe for decision.
survive a Rule 12(b)(6) motion to dismiss, a pleading must
provide "a short and plain statement of the claim
showing that [the claimant] is entitled to relief."
Fed.R.Civ.P. 8(a)(2). The purpose of this requirement is to
"give the defendant fair notice of what the . . . claim
is and the grounds upon which it rests." Erickson v.
Pardus, 551 U.S. 89, 93 (2007) (quoting Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 555 (2007)). The Court
must accept all of the Counterclaim's factual allegations
as true, and construe the pleadings in the light most
favorable to EB, drawing all reasonable inferences in
EB's favor. See Ashley Cnty., Ark. v. Pfizer,
Inc., 552 F.3d 659, 665 (8th Cir. 2009).
the Counterclaim "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, 678 (2009) (quoting
Twombly, 550 U.S. at 570). "A claim has facial
plausibility when the [claimant] pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged."
Id. "A pleading that offers 'labels and
conclusions' or 'a formulaic recitation of the
elements of a cause of action will not do.' Nor does a
[pleading] suffice if it tenders 'naked assertion[s]'
devoid of 'further factual enhancement.'"
Id. In other words, while "the pleading
standard that Rule 8 announces does not require 'detailed
factual allegations, ' ... it demands more than an
unadorned, the defendant-unlawfully-harmed-me
Counterclaim for breach of contract is premised entirely on
the following allegations:
77. The Sales Representative Agreement is a valid and
enforceable contract between the parties.
78. Defendant has fully satisfied all of its obligations to
Plaintiff under the Sales Representative Agreement.
79. Plaintiff breached its obligations to Defendant under the
Sales Representative agreement by, inter alia,
failing to perform in accordance with Section 6 of the Sales
Representative Agreement, and/or by selling and/or marketing
competitive products to existing and targeted, prospective
customers in violation of the Sales Representative Agreement.
80. As a result of Plaintiff's breaches, Defendant has
lost sales and otherwise been damaged in an amount to be
determined at trial, but believed to exceed $4 ...