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Edinburgh Holdings, Inc. v. Education Affiliates, Inc.

Court of Chancery of Delaware

June 6, 2018

EDINBURGH HOLDINGS, INC., Plaintiff,
v.
EDUCATION AFFILIATES, INC., RETS TECH CENTER INC., and JLL PARTNERS FUND IV, L.P., Defendants. EDUCATION AFFILIATES INC. and RETS TECH CENTER, INC., Counterclaim Plaintiffs,
v.
EDINBURGH HOLDINGS, INC., Counterclaim Defendant. EDUCATION AFFILIATES INC. and RETS TECH CENTER, INC., Third-Party Plaintiffs,
v.
STEVEN J. KNIER, DAVID MANTICA, and FRANK BEANLAND, Third-Party Defendants.

          Date Submitted: March 20, 2018

          Ryan P. Newell, Esquire and Kyle Evans Gay, Esquire of Connolly Gallagher LLP, Wilmington, Delaware, and Lee M. Whitman, Esquire and Samuel A. Slater, Esquire of Wyrick Robbins Yates & Ponton LLP, Raleigh, North Carolina, Attorneys for Plaintiff and Counterclaim Defendant Edinburgh Holdings, Inc. and Third-Party Defendants Steven J. Knier, David Mantica and Frank Beanland.

          Douglas D. Herrmann, Esquire and Christopher B. Chuff, Esquire of Pepper Hamilton LLP, Wilmington, Delaware, Attorneys for Defendants, Counterclaim Plaintiffs and Third-Party Plaintiffs Education Affiliates Inc. and RETS Tech Center, Inc.

          MEMORANDUM OPINION

          SLIGHTS, VICE CHANCELLOR.

         In 2013, the American Society of Professional Education, Inc. ("ASPE") sold its proprietary education business to a subsidiary of Education Affiliates, Inc. ("EA") (the "Transaction"). The Transaction was memorialized in an Asset Purchase Agreement dated August 14, 2013 (the "APA"). The APA provides that the buyer would pay a set price upon closing and then make future payments contingent upon the acquired business' achieving certain revenue targets post-closing. The contingent purchase price was payable in annual installments over four years. After closing, ASPE's management continued to operate ASPE's former business (the "ASPE Business Unit"), which became one of EA's several educational offerings.

         EA and its wholly-owned subsidiary, RETS Tech Center, Inc. ("RETS"), [1]made the contingent purchase price payments as provided in the APA for fiscal years 2013, 2014 and 2015. In 2017, however, Buyers refused to make the final payment (for fiscal year 2016), alleging that the payment obligation was excused as a result of Transaction-related misconduct on the part of ASPE's former management- Steven Knier, David Mantica and Frank Beanland.

         ASPE, which changed its name to Edinburgh Holdings, Inc. ("Edinburgh")[2]post-closing, responded by filing a complaint in this Court on July 10, 2017, in which it seeks to recover the remaining contingent purchase price payment due under the APA. Edinburgh's complaint alleges, among other things, that Buyers have breached (1) the APA by failing to pay the remaining amounts; and (2) the covenant of good faith and fair dealing inherent in the APA "by preventing, refusing, and obstructing" the required payment.

         Buyers answered Edinburgh's complaint on September 8, 2017, and brought counterclaims against Edinburgh and third-party claims against Knier, Mantica and Beanland. [3] Specifically, Buyers allege that (1) ASPE and Knier fraudulently induced Buyers to sign the APA by falsely promising revenue growth; (2) ASPE, Knier, Mantica and Beanland breached the APA by mismanaging the ASPE Business Unit after the Transaction's closing; and (3) Knier, Mantica and Beanland breached fiduciary duties owed to Buyers and the ASPE Business Unit by failing to operate the ASPE Business Unit in compliance with the APA and in a manner that would allow the business to achieve "promised" revenue targets.

         Buyers have moved to dismiss Count V of Edinburgh's complaint (for breach of the implied covenant of good faith and fair dealing) as duplicative of Edinburgh's breach of contract claim. Sellers have moved to dismiss all of Buyers' counterclaims and the third-party complaint.[4] For the reasons that follow, Buyers' motion to dismiss Count V of Edinburgh's complaint is GRANTED. Sellers' motion to dismiss is GRANTED as to the fraudulent inducement and breach of fiduciary duty claims, and DENIED as to the breach of contract claim.

         I. BACKGROUND

         In accordance with Court of Chancery Rule 12(b)(6), the facts are drawn from the pleadings, documents incorporated into the pleadings by reference and matters of which the Court may take judicial notice.[5]

         A. Parties and Relevant Non-Parties

         Plaintiff and Counterclaim Defendant, Edinburgh, is a North Carolina corporation headquartered in Cary, North Carolina.[6] Edinburgh operated under the name ASPE until the Transaction, whereby it sold "the branding associated with the name 'ASPE'" to RETS.[7]

         ASPE (and now, the ASPE Business Unit) offers courses primarily to large companies seeking to train their employees "in a particular technical skill such as Project Management, Business Analysis, Agile Methods, Software Testing, Microsoft SharePoint, and DevOps."[8] It derives its revenues primarily from tuition payments.[9]

         Defendant, JLL, is a Delaware limited partnership headquartered in New York. JLL formed and funded EA in 2004 "to pursue a built-up strategy in the post-secondary education industry focused primarily in the healthcare sector."[10]

         Defendant, Counterclaimant and Third-Party Plaintiff, EA, is a Delaware corporation headquartered in Baltimore, Maryland. At the time of the Transaction, "EA was a fifty-campus proprietary vocational education company."[11] Its students are mainly professionals seeking career changes or advancement.[12]

         Non-party, Fortis, is a wholly-owned subsidiary of EA that was formed to serve as EA's acquisition vehicle for the Transaction.[13] Fortis is a party to the APA and is referred to therein as "Buyer."[14] Following the Transaction's consummation, Fortis "assigned its rights and obligations under the APA" [15] to Defendant, Counterclaimant and Third-Party Plaintiff, RETS, an Ohio corporation with operations throughout the United States.[16] RETS is also a wholly-owned subsidiary of EA.[17]

         Third-Party Defendant, Steven J. Knier, founded ASPE in 2002. Prior to the Transaction, he was ASPE's CEO and one of its stockholders.[18] He subsequently became an officer of the ASPE Business Unit pursuant to an employment agreement dated September 11, 2013, and executed in connection with the Transaction.[19]

         Third-Party Defendant, David Mantica, was ASPE's president and an ASPE stockholder prior to the Transaction. He subsequently became the president of the ASPE Business Unit pursuant to his own employment agreement dated September 11, 2013.[20]

         Third-Party Defendant, Frank Beanland, was the CFO and a stockholder of ASPE prior to the Transaction.[21] He became the vice-president of the ASPE Business Unit following the Transaction, again pursuant to an employment agreement dated September 11, 2013.[22]

         B. Regulatory Requirements Applicable to Proprietary Schools

         Under federal law, proprietary schools such as EA and ASPE may not derive more than 90% of their revenues from Department of Education ("DOE") Title IV federal student aid funds, meaning that at least 10% of revenues must come from non-governmental (i.e., private) sources.[23] In the proprietary school industry, this "revenue mix" requirement is known as the "90-10 Rule, " and revenues derived from private sources are referred to as "10-Money."[24] According to Sellers, EA's pre-Transaction revenue mix violated the 90-10 Rule, or at least came very close to doing so. Thus, Sellers contend, EA's "primary interest in the [T]ransaction was satisfying the 90-10 Rule revenue requirements, " given that ASPE was in solid compliance with the rule.[25]

         C. The Transaction Negotiations

         In early 2013, EA retained a broker to contact ASPE about a possible transaction.[26] The parties met shortly after this initial contact, although their accounts of the first meeting differ. According to Buyers, Knier and Mantica visited EA's offices in Baltimore in January 2013 and "provided a presentation to Duncan Anderson, EA's CEO."[27] According to Sellers, Knier and Mantica first "presented an overview of ASPE's business in a PowerPoint slide presentation" during a May 15, 2013 meeting at ASPE's offices in North Carolina.[28] Although the parties disagree regarding the timing and location of the initial meeting, they do agree that Knier and Mantica at some point presented to EA information regarding ASPE's business and the strengths and capabilities of its management.[29] The presentation included revenue projections for fiscal years 2014-2016 as well as an explanation of contingencies and assumptions with regard to those estimates.[30] The projected revenues were $15.9 million for 2014, $18.5 million for 2015 and $20.5 million for 2016.[31]

         According to Buyers, following the initial presentation in January 2013, during a May 15, 2013 meeting at ASPE's offices in Cary, North Carolina (the parties' first meeting according to Sellers), Knier and Mantica "again[] made representations as to the revenue and profit growth that the ASPE Business Unit would achieve after the [Transaction]."[32] At this May 15 meeting, Anderson and EA's CFO, Steve Budosh, toured ASPE's offices, met ASPE's management and got a sense of ASPE's business.[33]

         The parties thereafter began conducting due diligence in anticipation of a potential ASPE-EA transaction.[34] In connection with the due diligence process, EA retained a Washington, DC-based law firm specializing in DOE Title IV compliance to evaluate ASPE's revenue qualification and revenue mix.[35]

         Buyers allege that their "initial offer to purchase the ASPE Business Unit was a lump sum . . . [to be] paid at closing [and that] . . . [their] initial offer was based off of ASPE's historical performance, mainly its recent EBITDA and revenue figures."[36] According to Buyers, "Sellers forcefully rejected that offer, and took the position that such an offer did not properly value the ASPE Business Unit given the revenue and profit growth . . . that the Unit would achieve."[37] Consequently, the parties "began negotiating earn-out provisions" based on Sellers' revenue representations-which Buyers define as "Promised Revenues and Profits."[38]

         D. The APA

         On August 14, 2013, following due diligence, Edinburgh (then ASPE), ASPE's stockholders (including Knier, Mantica and Beanland) and Fortis executed the APA.[39] Here, the APA's purchase price and contingent payment provisions are most relevant and each is discussed below.

         1. The Purchase Price

         The APA, at Section 2.1, divides the "Purchase Price" into two parts: (1) the Initial Purchase Price of $6 million less certain enumerated amounts due at closing, [40] and (2) the Contingent Purchase Price. [41] According to Section 2.1(b), the Contingent Purchase Price is calculated pursuant to a three-step formula:

1. 50% of the Pre-Tax Profits[42] for fiscal years 2013, 2014 and 2015 if the Total Revenue[43] for the relevant fiscal year was less than $13 million, or 65 % of the Pre-Tax Profits if Total Revenue was equal to or greater than $13 million[44];
2. If the aggregate amount paid under the formula set forth above, as of December 31, 2016, is less than $2 million, then Buyer will pay an additional sum of $2 million less any amounts already paid towards the Contingent Purchase Price[45]; and
3. If revenues for the fiscal year ending December 31, 2016 are $8 million or more, then buyer will pay 25% of the 2016 revenues (the "Total Revenue Earnout") plus cumulative losses over the period from the closing date through December 31, 2016.

         Both parties maintain that the Contingent Purchase Price formula is unambiguous on its face and as applied.

         2. Management of the ASPE Business Unit During the Contingent Payment Period

         Per Section 2.1(f) of the APA, following the Transaction's closing, ASPE's business would become "part of a larger, integrated educational institution" (namely, EA) and thereafter would be referred to as the "ASPE Business Unit."[46]The ASPE Business Unit was to "(i) [be] manage[d] using the current management . . . subject to the terms of their employment agreements, and conduct its activities in a reasonable manner consistent with its past practices . . . and (ii) report, budget and forecast . . . its educational and financial status to the Buyer and/or the integrated educational institution, if applicable."[47] Section 2.1(f) further provides that the ASPE Business Unit would "be afforded the ability to make and execute strategies and plans to grow [the] business with full cooperation from Buyer provided that those plans are: (sic) fully compliant with all applicable laws, enable revenue growth consistent with the approximate current mix of Program Revenues and non-Program Revenues, and do not result in fiscal year losses or requests for additional capital over the contingent payment period."[48]

         E. The Related Agreements

         As noted, at the time of closing of the Transaction, Knier, Mantica and Beanland, along with ASPE's remaining management, entered into employment agreements with Buyers providing for their post-closing employment with the ASPE Business Unit (the "Employment Agreements").[49] Buyers allege that, in seeking post-closing employment, "Knier assured [Buyers] that he and his management team [were] strategic, focused, and nimble, and more than capable of identifying and capturing future profitable [] growth opportunities, regardless of any changing market dynamics."[50] In that spirit, Knier, Mantica and Beanland were able to negotiate for significant autonomy in running the ASPE Business Unit as reflected in their Employment Agreements.

         On August 14, 2013, JLL and Fortis also entered into a letter agreement (the "JLL Letter Agreement") pursuant to which JLL committed to make the Contingent Purchase Price payments when due "if and to the extent that [Fortis] (or Transferee, as applicable) is unable to make such payment."[51] Two months later, on October 10, 2013, Fortis assigned all its "rights and obligations" under the APA to RETS.[52]

         F. ASPE Business Unit Operations After the Transaction

         Following the closing, EA placed James Herbst, EA's Regional Vice President, in ASPE's headquarters in Cary, North Carolina.[53] Herbst met weekly with ASPE Business Unit management to oversee the unit's revenues and operations.[54] He also held monthly financial and operations calls with Anderson, Budosh and other EA executives to update them on the unit's progress.

         In addition to placing Herbst in ASPE's North Carolina headquarters, EA facilitated information flow by requiring the ASPE Business Unit to participate in yearly budget reviews and financial audits.[55] EA also asked Knier, Mantica and Beanland to send weekly reports to EA with the week's cash reports, sales receipts and qualified 10-Money receipts.[56] Finally, it is alleged that EA reviewed and approved the ASPE Business Unit's annual budgets prior to each fiscal year with guidance from Herbst.[57]

         The approved budgets for fiscal years 2014-2016 forecast approximately $13 million in revenue each year.[58] The ASPE Business Unit reported actual revenues of $12, 022, 519 in 2013, $12, 194, 480 in 2014, $12, 461, 993 in 2015 and $12, 635, 899 in 2016.[59] These revenue results triggered Contingent Purchase Price payments for fiscal years 2013, 2014 and 2015 in keeping with the APA's Contingent Purchase Price requirements.[60]

         On April 13, 2017, Anderson sent a letter to Knier claiming that Knier and his team had breached the APA, the covenant of good faith and fair dealing inherent in the APA and their fiduciary duties to Buyers and the ASPE Business Unit by failing to achieve the revenues "promised" by ASPE and Knier during the APA negotiations. Anderson declared that, as a result of these breaches, Buyers would not pay the remaining Contingent Purchase Price installment of approximately $4, 736, 000 for fiscal year 2016.[61]

         G. Procedural Posture

         Edinburgh filed its Verified Complaint (the "Complaint") on July 10, 2017.[62]The Complaint sets forth five counts:

■ Count I seeks a declaratory judgment that ASPE and Knier did not fraudulently induce EA to execute the APA and that ASPE and Knier's team did not breach any contractual, fiduciary or implied duties.[63]
■ Count II alleges that RETS breached "the APA by failing to pay the remaining portion of the Contingent Purchase Price" that was due and payable to Edinburgh.[64]
■ Count III alleges that EA breached "the APA by failing to pay the remaining portion of the Contingent Purchase Price" that was due and payable to Edinburgh, but that RETS refused to pay.[65]
■ Count IV alleges that JLL breached the JLL Letter Agreement by failing to pay Edinburgh the Fixed EO Obligation.[66]
■ Count V alleges that EA, RETS and JLL breached the implied covenant of good faith and fair dealing by "act[ing] in bad faith and with the sole purpose of preventing, refusing, and obstructing [Edinburgh's] 2016 Contingent Purchase Price payment so as to deprive [Edinburgh] of the fruits of its bargain."[67]

         Buyers answered Edinburgh's Complaint on September 8, 2017, and brought counterclaims against Edinburgh and a third-party complaint against Knier, Mantica and Beanland.[68] Specifically, the responsive pleading sets forth three counts:

■ Count 1 alleges that Edinburgh and Knier fraudulently induced Buyers to execute the APA.
■ Count 2 alleges that Sellers breached the APA by "fail[ing] to act in a reasonable manner consistent with ASPE's past practices, fail[ing] to make and execute strategies and plans that enabled the ASPE Business Unit to achieve the promised revenue growth, and fail[ing] to report, budget, and forecast in line with the budgets and forecasts provided . . . prior to Closing."[69]
■ Count 3 alleges that the third-party defendants breached their fiduciary duties to Buyers and the ASPE Business Unit "by acting with reckless indifference and deliberate disregard to [Buyers], and failing to act in good faith to maximize the value [for Buyers] and the ASPE Business Unit over the long term."[70]

         On December 20, 2017, Buyers filed a motion to dismiss Edinburgh's Count V (the implied covenant claim) pursuant to Court of Chancery Rule 12(b)(6). That same day, Sellers filed a motion to dismiss all of Buyers' counterclaims and third-party claims under Court of Chancery Rules 12(b)(6) and 9(b). For the reasons explained below, Buyers' motion to dismiss is granted, and Sellers' motion to dismiss is granted in part (as to Counts 1 and 3) and denied in part (as to Count 2).

         II. ANALYSIS

         On a motion to dismiss under Chancery Rule 12(b)(6), [71] the court accepts the complaint's well-pled allegations as true and draws all reasonable inferences therefrom in favor of the party opposing the motion.[72] The court will grant a motion to dismiss only if it determines "with reasonable certainty that a plaintiff could prevail on no set of facts that can be inferred from the pleadings."[73]

         A. Buyers' Motion to Dismiss the Implied Covenant Claim

         Under Delaware law, "the implied covenant of good faith and fair dealing attaches to every contract by operation of law."[74] In essence, the implied covenant "requires a party in a contractual relationship to refrain from arbitrary or unreasonable conduct which has the effect of preventing the other party to the contract from receiving the fruits of the bargain."[75]

         The gravamen of Count V is that Knier, Mantica and Beanland operated the ASPE Business Unit "in a manner sufficient to secure [payment of] the Contingent Purchase Price for [fiscal] year 2016, " but Buyers (wrongfully) refused to make that payment.[76] According to Edinburgh, if the Court reads Section 2.1(f) of the APA to require the ASPE Business Unit (under Knier's leadership) to achieve revenue growth as alleged by Buyers, or allows a claim that Sellers made binding extra-contractual representations that Knier and his team would achieve such growth, then the "[t]he implied covenant operates to ensure that . . . [Buyers] would not deprive [Sellers] of the fruits of [the] bargain by actively preventing [Knier's team] from achieving those revenues."[77] Edinburgh maintains that Buyers prevented the ASPE Business Unit from achieving the alleged revenue thresholds by "remain[ing] singularly focused on securing 10-Money . . . [and] den[ying] [Sellers'] business acquisition requests [as specifically alleged] that would have helped grow ASPE and increase its revenue."[78]

         Buyers move to dismiss Edinburgh's implied covenant claim as "wholly duplicative of Edinburgh's Contract Claims." [79] Specifically, they argue that Count V "(i) [is] based upon the same conduct as [Edinburgh's] Contract Claims; (ii) sets forth the same purportedly wrongful conduct that is alleged in the Contract Claims-non-payment of a portion of the Contingent Purchase Price; and (iii) seeks the same relief sought in connection with the Contract Claims-payment of the non-paid portion of the Contingent Purchase Price."[80] Buyers submit that even if the claim is not duplicative, Count V still must be dismissed because Edinburgh has failed to allege a contractual gap that the Court could fill by implying a covenant of good faith.

         Before addressing the viability of Count V, I note that Edinburgh has pled its implied covenant claim more as an anticipatory defense to Buyers' extra-contractual claims than as an affirmative claim for relief. Specifically, Edinburgh invokes the implied covenant in response to Buyers' claim that, even though not mentioned in the APA, Sellers made binding commitments that the ASPE Business Unit would reach certain revenue targets and have breached those commitments. According to Edinburgh, Buyers acted in bad faith to prevent Knier's team from reaching any revenue targets that may have been promised and cannot, therefore, recover for any breach of those promises. Our law recognizes that the implied covenant may be employed in this manner as a means to defend against claims of breach.[81] Thus, Sellers will be entitled to develop and present evidence that Buyers acted in bad faith to prevent Sellers' performance of any contractual obligations that might have been owed to Buyers (under the APA or otherwise).

         Insofar as Count V asserts an implied covenant claim, however, it is improperly duplicative of Edinburgh's contract claims. The implied covenant is available only where the terms to be implied are missing from the contract[82]; it "cannot be invoked to override the express terms of a contract."[83] Thus, if the contract at issue expressly addresses a particular matter, an implied covenant claim respecting that matter is duplicative and not viable.[84]

         Edinburgh's Count V is based on Buyers' "preventing, refusing, or obstructing [Edinburgh's] achievement of the Contingent Purchase Price payment."[85] The APA, however, expressly addresses Edinburgh's right to the Contingent Purchase Price, and Edinburgh has asserted claims against Buyers for (allegedly) violating that contractual right (in Counts II, III and IV of the Complaint).[86] That being so, Count V fails as a matter of law and must be dismissed.[87]

         B. Sellers' Motion to Dismiss

         Sellers seek to dismiss all of Buyers' counterclaims and third-party claims pursuant to Court of Chancery Rules 12(b)(6) and 9(b). As noted, Buyers have asserted three counts: Count 1, against Edinburgh and Knier, for fraudulent inducement; Count 2, against Edinburgh and the third-party defendants, for breach of contract (with regard to the APA); and Count 3, against the third-party defendants, for breach of fiduciary duty. In support of their motion, Sellers argue that Count 1 does not plead a fraudulent inducement claim with the requisite particularity; Count 2 is not viable because Buyers have not well pled a breach of the APA; and Count 3, the breach of fiduciary duty claim, is not viable because it is duplicative of Count 2. I address each Count in turn.

         1. Count 1 - Fraudulent Inducement

         Count 1 alleges that ASPE and Knier (i) "falsely represented to [Buyers] that any Contingent Purchase Price payment would come from and be satisfied by ASPE's new growth and additional profitability"[88]; and (ii) made representations in Section 2.1(f) of the APA that they "would conduct business in a reasonable manner consistent with past practices, report, budget, and forecast in line with the budgets and forecasts provided . . . prior to Closing . . . and achieve revenue and profit growth that ASPE and Mr. Knier promised and represented the Unit would achieve."[89]Count 1 further alleges that ASPE and Knier knew these representations were false or were recklessly indifferent to their truth when made, that they made the representations to induce Buyers to execute the APA and that Buyers "reasonably and justifiably relied" on the representations "in agreeing to the Contingent Purchase Price and entering into the APA."[90]

         Edinburgh and Knier counter that the fraudulent inducement claim should be dismissed because (i) Buyers fail to plead fraud with particularity as required under Court of Chancery Rule 9(b); (ii) the alleged fraudulent statements concern predictions about the future, which are not actionable as a matter of Delaware law; and (iii) Buyers fail adequately to plead justifiable reliance on the alleged misrepresentations.

         In reply, Buyers contend that their pleading satisfies Rule 9(b)'s requirements because they "have alleged, with specificity, the content of the fraudulent representations, who made those representations, when those representations were made, and what ASPE and Knier stood to gain from making them."[91] They further submit that they have "adequately allege[d] that the representations were false and that ASPE and Knier knew they were false [because], [c]ontrary to Knier's and ASPE's representations and promises, the ASPE Business Unit earned only $892, 000 in Pre-Tax Profit from 2014-2016-just 17% of the Pre-Tax Profits that ASPE and Knier promised the Unit would make during that timeframe."[92]

         Additionally, Buyers contend that each of the alleged misrepresentations is actionable because (1) part of the fraud claim "is premised upon knowing false statements within the APA itself"; and (2) the "extra contractual fraudulent statements are actionable because they relate to past or present fact and/or were knowingly false when made."[93] Finally, Buyers posit that whether they reasonably relied on the alleged misrepresentations is a question of fact not suitable for resolution on a motion to dismiss.[94] Even if the question were ripe for resolution, however, Buyers argue they have adequately pled reasonable reliance because they "are undoubtedly able to rely on . . . contractual representations, " and have alleged they "would never have agreed to the Contingent Purchase Price construct absent ASPE and Knier's promises and representations."[95] Since the APA does not contain an anti-reliance clause, "the APA reflects the parties' intention that [Buyers] could reasonably and justifiably rely upon extra-contractual representations . . . ."[96]

         To plead fraud (or fraudulent inducement), a plaintiff

must plead facts supporting an inference that: (1) the defendants falsely represented or omitted facts that the defendant had a duty to disclose; (2) the defendants knew or believed that the representation was false or made the representation with a reckless indifference to the truth; (3) the defendants intended to induce the plaintiff to act or refrain from acting; (4)the plaintiff acted in justifiable reliance on the representation; and (5)the plaintiff was injured by its reliance.[97]

         "[T]o satisfy Rule 9(b), a complaint must allege, " with particularity, "the time, place, and contents of the false representation; . . . the identity of the person making the representation; and . . . what the person intended to gain by making the representation[]." [98] While Rule 9(b) allows a plaintiff to allege knowledge generally, "where pleading a claim of fraud has at its core the charge that the defendant knew something, there must, at least, be sufficient well-pled facts from which it can reasonably ...


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