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Southwest Engineering, Inc. v. Yeomans Chicago Corp.

November 3, 2009

SOUTHWEST ENGINEERING, INC., PLAINTIFF,
v.
YEOMANS CHICAGO CORPORATION, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Honorable Janis L. Sammartino United States District Judge

ORDER: (1) GRANTING DEFENDANT'S MOTION TO DISMISS AND (2) DISMISSING WITHOUT PREJUDICE (Doc. No. 7)

Presently before the Court is Defendant's motion to dismiss the First Amended Complaint (FAC). (Doc. No. 16.) Plaintiff has filed an opposition and Defendant has replied to that opposition. (Doc. Nos. 18 & 24.) Having fully considered the parties' arguments and the relevant law, Defendant's motion is GRANTED and this action is DISMISSED WITHOUT PREJUDICE.

BACKGROUND

In February, 2004, Plaintiff Southwest Engineering, Inc. and the County of San Diego, California entered into a written contract regarding a public works project.*fn1 (Doc. No. 14 (FAC) ¶ 6.) Plaintiff "entered into a partly oral and partly written agreement" with Defendant for the sale of certain pumps "that would comply with the requirements of the Project's plans and specifications." (Id. ¶ 7.) Plaintiff alleges that the pumps "were not free from defects in material and workmanship" and "did not meet the requirements of the Project's plans and specifications." (Id. ¶ 8.) Plaintiff also claims that it worked for almost two years with Defendant to get the problems resolved and repaired but that Defendant's efforts were not adequate or successful. (Id. ¶ 10.) The result of this has been "unanticipated added and extra costs." (Id. ¶ 13.)

On December 10, 2008, Plaintiff filed suit in California Superior Court and Defendant removed the action to this Court. (Doc. No. 1.) On April 20, 2009, this Court granted Defendant's motion to dismiss. (Doc. No. 13 (Prior Order).) Plaintiff filed its First Amended Complaint on May 8, 2009 and Defendant filed the present motion to dismiss on May 22, 2009. (Doc. Nos. 14 & 16.)

LEGAL STANDARD

Federal Rule of Civil Procedure 12(b)(6) permits a party to raise by motion the defense that the complaint "fail[s] to state a claim upon which relief can be granted," generally referred to as a motion to dismiss. The Court evaluates whether a complaint states a cognizable legal theory and sufficient facts in light of Federal Rule of Civil Procedure 8(a), which requires a "short and plain statement of the claim showing that the pleader is entitled to relief." Although Rule 8 "does not require 'detailed factual allegations,' . . . it [does] demand[] more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, -- US - , 129 S.Ct. 1937, 1949 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). In other words, "a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). "Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Iqbal, 129 S.Ct. at 1949 (citing Twombly, 550 U.S. at 557).

"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Id. (quoting Twombly, 550 U.S. at 570); see also Fed. R. Civ. P. 12(b)(6). A claim is facially plausible when the facts pled "allow[] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556). That is not to say that the claim must be probable, but there must be "more than a sheer possibility that a defendant has acted unlawfully." Id. Facts "'merely consistent with' a defendant's liability" fall short of a plausible entitlement to relief.*fn2 Id. (quoting Twombly, 550 U.S. at 557). Further, the Court need not accept as true "legal conclusions" contained in the complaint. Id. This review requires context-specific analysis involving the Court's "judicial experience and common sense." Id. at 1950 (citation omitted). "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not 'show[n]'-'that the pleader is entitled to relief.'" Id.

ANALYSIS

I. Contractual Warranty Allegations

Plaintiff alleges that it "entered into a partly oral and partly written agreement" that contained two warranties. (FAC ¶ 7.) First, the contract "warranted that the pumps would be 'free from defect in material and workmanship under normal use and service, and when properly installed.'" (Id.) Second, Plaintiff alleges that Defendant warranted that the pumps supplied "would comply with the requirements of the Project's plans and specifications." (Id.)

Defendant raises two challenges to these allegations. First, it argues that there is no warranty that the pumps would comply with the requirements of the project. (Memo. ISO Motion at 4--5; Reply at 2--5.) Second, Plaintiff claims that the allegation that the contract was "partly oral and partly written" is directly contradicted by the contract.*fn3 The Court notes, as held in its Prior Order, that the parties dispute is governed by Illinois law. (Prior Order at 3--4.)

A. Warranty That Pumps Would Comply With Project Specifications

The contract agreed to by the parties to this case contained an addendum labeled "Standard Terms and Conditions." ((See FAC, Ex. A (Contract) at 13--20.*fn4 ) Within that addendum ...


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