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Title: Mdt Tek, LLC v. Staffchex

June 29, 2012

TITLE: MDT TEK, LLC
v.
STAFFCHEX, INC. ET AL.



The opinion of the court was delivered by: Present: The Honorable David O. Carter, Judge

CIVIL MINUTES -- GENERAL

O

Julie Barrera N/A

Courtroom Clerk Court Reporter ATTORNEYS PRESENT FOR PLAINTIFF: ATTORNEYS PRESENT FOR DEFENDANT:

None Present None Present PROCEEDINGS: (IN CHAMBERS): ORDER DENYING DEFENDANTS'

MOTION TO DISMISS THE SECOND AND THIRD CAUSES OF ACTION AND/OR TO STRIKE PORTIONS OF THE FIRST AMENDED COMPLAINT

Before the Court is a Motion to Dismiss ("Motion") filed by Defendants Ruben Garza, StaffChex, Inc., and StaffChex Servicing LLC (hereinafter, collectively referred to as "Defendants"). Mot. (Dkt. 15). The Court finds this matter appropriate for decision without oral argument. Fed.R.Civ. P. 78; Local Rule 7-15. After considering the moving, opposing, and replying papers, the Court hereby DENIES Defendants' Motion to Dismiss.

I.Background

The facts alleged by MDT Tek, LLC ("Plaintiff") are as follows:

a.The Parties

Plaintiff operates the iLabor Network, which allows Plaintiff's clients to request and supply third-party employees according to other clients' temporary personnel needs. Plaintiff is a limited liability company organized under Pennsylvania law with its principal place of business in Pennsylvania. First Am. Cmpl. ("FAC") ¶ 7.

Defendant Ruben Garza ("Garza") is the owner and Chief Executive Officer of StaffChex Servicing LLC ("StaffChex Servicing") and StaffChex, Inc. FAC ¶ 40. Defendant StaffChex, Inc., is incorporated under California law with its principal place of business in Orange, CA. Id. at ¶ 2. Defendant StaffChex Servicing is a limited liability company organized under California law with its principal place of business in Orange, CA. Id. at ¶ 3.

b.Defendant StaffChex's Certificate of Cancellation

On February 23, 2010, unknown to Plaintiff, Defendant StaffChex Servicing filed a certificate of cancellation with the State of California that was signed by Defendant Garza. FAC ¶ 8; FAC Ex. A.

c.The iLabor Network Service Agreement

On July 26, 2010, Defendant Garza, on behalf of Defendant StaffChex Servicing and Defendant StaffChex, Inc., entered into the iLabor Network Service Agreement ("Agreement") with Plaintiff. FAC ¶ 9; FAC Ex. B. The Agreement allowed Defendants StaffChex Servicing and StaffChex, Inc., to access Plaintiff's iLabor Network to request and employ third-party personnel for temporary employment. Id. According to the Agreement, Defendant StaffChex Servicing and Defendant StaffChex, Inc., agreed to pay $2,885 per week for 104 weeks as payment for use of the iLabor Network. FAC ¶ 10; FAC Ex. B.

d.Breach of the Agreement

Between July 26, 2010 and May 24, 2011, Defendant StaffChex Servicing and StaffChex, Inc., paid Plaintiff $38,000. FAC ¶ 11. After May 24, 2011, Defendants StaffChex Servicing and StaffChex, Inc., failed to make any weekly payments. Id. at ¶

12. On June 20, 2011, Plaintiff sent a final demand for payment addressed to Defendant StaffChex, Inc. FAC ¶ 14; FAC Ex. C.

According to the Agreement, if payments remain uncured for over seven business days, Plaintiff can demand the entire remaining payment immediately. FAC ΒΆ 13; FAC Ex. B. In this case, the ...


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