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Luster v. Puracap Laboratories, LLC

United States District Court, D. Delaware

December 10, 2018

JOSEPH WILLIAM LUSTER, Plaintiff,
v.
PURACAP LABORATORIES, LLC, Defendant.

          Brian C. Ralston, Jacob R. Kirkham, POTTER ANDERSON & COROON LLP, Wilmington, DE Attorneys for Plaintiff

          David A. Dorey, Adam V. Orlacchio, BLANK ROME LLP, Wilmington, DE - attorneys for Defendant December 10, 2018 Wilmington, Delaware.

          MEMORNDUM OPINION

          NOREIKA, U.S. DISTRICT JUDGE.

         Pending before the Court is the motion of Defendant PuraCap Laboratories, LLC ("PuraCap") to dismiss Count III of the Complaint filed by Plaintiff Joseph William Luster ("Plaintiff) arguing Plaintiff has failed to state a claim upon which relief can be granted pursuant to Fed.R.Civ.P. 12(b)(6). (D.I. 4). For the reasons set forth below, the Court will GRANT Defendant's motion.

         I. BACKGROUND

         A. The Consulting Agreement

         The dispute in this case relates to a Consulting Agreement dated March 31, 2016 ("the Agreement") entered into by Plaintiff and PuraCap. (D.I. 1, Ex. A ¶¶ 1, 7). Plaintiff alleges that, "[u]nder the terms of the Agreement, [he] was to provide certain consulting services" and "was to receive a fee for such services, as well as additional performance compensation." (Id. ¶ 7). Specifically, Plaintiff alleges that Schedule 2 of the Agreement requires PuraCap "to make certain payments under the 'Journey Medical Contract' and 'Additional Government Contracts.'" (Id. ¶¶ 8-10). Plaintiff further alleges that the Agreement entitles him to inspect "the relevant books and records of [PuraCap] as may be reasonably necessary to determine and/or verify the amount of the applicable Performance Compensation Payment due." (Id. ¶ 14).

         B. The Current Dispute

         Plaintiff alleges that, on November 30, 2017, he "requested via letter that he, and his external accounting firm, be provided access to the relevant books and records in order to determine the amount of the Performance Compensation Payment due to him" and, further, that he followed up on that request in December 2017. (D.I. 1 ¶ 15). He alleges that despite his requests, "[t]o date, although PuraCap has provided limited books and records in the form of summary spreadsheets to Luster, it has not provided all books and records 'reasonably necessary to determine and/or verify the amount of the applicable Performance Compensation Payment due ....'" (Id. ¶ 16). Plaintiff does not specify the additional materials that he seeks. Plaintiff also alleges that PuraCap has failed to pay him the Performance Compensation owed and has improperly restricted his access to PuraCap's facilities due to a dispute between PuraCap and two of Plaintiff s companies. (Id. ¶¶ 13, 17).

         On March 13, 2018, Plaintiff sued Defendant in the Delaware Court of Chancery, alleging the following three claims: (1) specific performance compelling PuraCap to provide Plaintiff with books and records related to the calculation of his Performance Compensation; (2) breach of contract for failure to pay Plaintiff the Performance Compensation purportedly owed; and (3) breach of the implied covenant of good faith and fair dealing based on PuraCap: (a) improperly including certain of PuraCap's expenses in its calculation of "Net Profits," adversely impacting Plaintiffs Performance Compensation and (b) restricting Plaintiffs access to PuraCap's facilities. (Id. ¶¶ 18-42).

         On April 4, 2018, PuraCap removed the action to this Court. On April 11, 2018, PuraCap filed the instant motion to dismiss. (D.I. 4). On April 25, 2018, Plaintiff responded to the motion. (D.I. 8). The Court has considered the Complaint, with attachments, and the parties briefing in connection with the motion.

         II. LEGAL STANDARDS

         A. Motion to Dismiss

         When reviewing a motion to dismiss pursuant to Rule 12(b)(6), the Court conducts a two-part analysis. Fowler v. UPMC Shadyside,578 F.3d 203, 210 (3d Cir. 2009). First, the Court separates the factual and legal elements of a claim, accepting "all of the complaint's well-pleaded facts as true, but [disregarding] any legal conclusions." Id. at 210-11. Second, the Court determines "whether the facts alleged in the complaint are sufficient to show... a 'plausible claim for relief" Id. at 211 (quoting Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009)). "The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1420 (3d Cir. 1997) (quoting Scheuer v. Rhodes,416 U.S. 232, 236 (1974)). The Court may grant a motion to ...


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