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Mosiman v. The Madison Companies, LLC

United States District Court, D. Delaware

January 15, 2019

BRETT J. MOSIMAN; PIPELINE PRODUCTIONS, INC.; and PIPELINE TICKETING, LLC, Plaintiffs,
v.
THE MADISON COMPANIES, LLC; BRYAN GORDON; HORSEPOWER ENTERTAINMENT LLC; HORSEPOWER ENTERTAINMENT MANAGEMENT LLC; KAABOOWORKS SERVICES LLC; KAABOOWORKS LLC; KAABOO-DEL MAR, LLC; KAABOO-DEL MAR INVESTMENT, LLC; and DOES 1 through 20 inclusive, Defendants.

          Daniel Charles Herr, LAW OFFICE OF DANIEL C. HERR LLC, Wilmington, Delaware; Michael H. Weiner, LAW OFFICE OF MICHAEL H. WEINER, APC, San Diego, California Counsel for Plaintiffs

          Stephen B. Brauerman, Sara E. Bussiere, BAYARD, P.A., Wilmington, Delaware; Ivy A. Wang, Russell Wolpert, Eric M. George, Benjamin D. Scheibe, BROWNE GEORGE ROSS LLP, Los Angeles, California Counsel for Defendants The Madison Companies, LLC; Bryan Gordon; Horsepower Entertainment LLC; Horsepower Entertainment Management LLC; Kaabooworks Services LLC; Kaabooworks LLC; Kaaboo-Del Mar, LLC; and Kaaboo-Del Mar Investment, LLC

          MEMORANDUM OPINION

          CONNOLLY, UNITED STATES DISTRICT JUDGE

         Plaintiffs Brett J. Mosiman, Pipeline Productions, Inc., and Pipeline Ticketing, LLC (collectively "Plaintiffs") have sued Defendants The Madison Companies, LLC; Bryan Gordon; Horsepower Entertainment, LLC; Horsepower Entertainment Management, LLC; Kaabooworks Services, LLC; Kaabooworks, LLC; Kaaboo-Del Mar, LLC; and Kaaboo-Del Mar Investment, LLC (collectively, "Defendants") over a failed business relationship to produce a music festival known as the Kaaboo Del Mar Music Festival. The complaint alleges sixteen causes of action against all Defendants. Currently pending before the Court is Defendants' motion to dismiss all sixteen causes of action as alleged against the individual defendant Bryan Gordon and fourteen of the sixteen causes of action as alleged against the "Entity Defendants" (i.e., all defendants except Gordon).[1] (D.I. 32). I have jurisdiction over this matter pursuant to 28 U.S.C. § 1332(a). For the reasons discussed below, I will grant in part and deny in part Defendants' motion to dismiss.

         I. BACKGROUND[2]

         Sometime in 2014, the specific dates are unclear, Plaintiffs and Defendants negotiated an oral agreement for the three-year production of the Kaaboo Del Mar Music Festival, pursuant to which Plaintiffs would receive $650, 000 over three years. (D.I. 1-3 at ¶¶ 20-23). The parties, however, were unable to reduce their oral agreement to a writing. (Id. at ¶ 36). At one point, Plaintiffs rejected a proposed written contract, because it changed the terms from a three-year agreement to three one-year agreements. (Id. at ¶ 35).

         Although no signed agreement was in place, Plaintiffs began working in July 2014 on producing the music festival. (Id. at ¶ 25). The complaint alleges that during this time, Plaintiffs "introduc[ed] the Defendants to various main players in the industry" and "provided confidential information to Defendants." (Id. at ¶¶ 27-30). Also during this time, Defendants paid Plaintiffs $10, 416.67 per month per the terms of the oral agreement. (Id. at ¶¶ 26, 33, 38). Then, in June 2015, the payments stopped. (Id. at ¶ 38).

         The complaint alleges that in October 2014, Defendants also awarded the Plaintiffs a contract to provide ticketing services for the music festival. (Id. at ¶¶ 41-44). Plaintiffs sent Defendants a written ticketing agreement, which Defendants never signed. (Id. at ¶ 45). Plaintiffs admit that the "agreements were never finalized or signed," but Plaintiffs nevertheless began performing services related to ticketing. (Id. at ¶¶ 44-51). The complaint alleges that Defendants "without notice canceled the ticketing agreement" and "never paid [Plaintiffs] for their services." (Id. at ¶¶ 49-50).

         II. STANDARD OF REVIEW

         Under Rule 12(b)(6), a party may move to dismiss a complaint for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). To survive a motion to dismiss, the complaint must contain sufficient factual matter "to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009) (quoting Bell Atl Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The factual allegations do not have to be detailed, but they must provide more than labels, conclusions, or a "formulaic recitation" of the claim elements. Twombly, 550 U.S. at 555. In assessing the plausibility of a claim, the Court must accept all well-pleaded factual allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. In re Rockefeller Ctr. Prop., Inc. Sec. Litig., 311 F.3d 198, 215 (3d Cir. 2002). The Court's review is limited to the allegations in the complaint, exhibits attached to the complaint, documents incorporated by reference, items subject to judicial notice, and matters of the public record. DM ex rel. Ray v. Phila. Housing Auth., 613 Fed.Appx. 187, 189 (3d Cir. 2015); Mayer v. Belichick, 605 F.3d 223, 230 (3d Cir. 2010); El-Hewie v. Bergen Cty., 348 Fed.Appx. 790, 794 (3d Cir. 2009).

         III. DISCUSSION

         The Court must determine whether the complaint adequately pleads the elements of a claim as to fourteen causes of action and adequately pleads liability as to the individual defendant Bryan Gordon, a manager of one of the entity defendants. Two of the fourteen causes of action are based on California statutes: misappropriation of trade secrets and unfair competition. The remaining twelve causes of action are based on the common law. The common law claims are for breach of contract, breach of the implied covenant of good faith and fair dealing, intentional misrepresentation, negligent misrepresentation, and promissory estoppel. Because the parties cited in their briefs only Delaware law with respect to the common law claims, I will assume Delaware law governs these claims. I first address each of the fourteen causes of action and then consider the liability of the individual defendant Bryan Gordon.

         A. Counts 1-2: Breach of Contract

         Counts 1 and 2 of the complaint are for breach of the oral production agreement and oral ticketing agreement. (D.I. 1-3 at ¶¶ 52-61). The complaint repeatedly alleges that the oral contracts were for three years. (See Id. at ¶¶ 23, 40, 66, 68, 85, 87, 89, 122, 125, 138, 142, and 147). Indeed, the complaint alleges that Plaintiffs refused to sign a written agreement memorializing the oral agreement, because the proposed written agreement changed the term of the oral contract to less than three years. (Id. at ¶¶ 35-36). Under the statute of frauds, 6 Del C. § 2714, oral contracts that cannot be performed within one year are unenforceable.[3]Olson v. Halvorsen,982 A.2d 286, 291 (Del. Ch. 2008). Because Counts 1 and 2 are based on a three-year oral contract, the claims are barred by the statute of frauds. Plaintiffs invoke the part performance exception to the statute of frauds. (D.I. 35 at 5). But "Delaware law is clear that the part performance doctrine does not apply to oral ...


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