United States District Court, S.D. California
ROBERT HALF INTERNATIONAL, INC., a Delaware corporation, Plaintiff,
ERIC SHANE AINSWORTH, an individual; LISA LYNN ALDAVA, an individual; SERENA MAI GREENWOOD, an individual; RUBEN D. HERNANDEZ, an individual; DEANA H. SCHWEITZER, an individual; CATHERINE S. SHERMAN, an individual; and DOES 1 through 20, Defendants.
WILLIAM Q. HAYES, District Judge.
The matter before the Court is the Motion to Dismiss Counterclaims for Breach of Contract and Unfair Competition or, in the Alternative, for a More Definite Statement filed by Plaintiff Robert Half International, Inc. (ECF No. 19).
On September 23, 2014, Plaintiff Robert Half International Inc. ("RHI") commenced this action by filing a Complaint in San Diego County Superior Court. (ECF No. 1-1). The Complaint alleges that Defendants, Plaintiff's former employees, breached their respective employment agreements and engaged in unfair competition after terminating employment with Plaintiff and going to work for competitors. The Complaint asserts claims for breach of contract, breach of fiduciary duty, breach of the implied covenant of good faith and fair dealing, tortious interference with prospective economic advantage, violation of the Lanham Act, violation of California Business & Professions Code section 17200, and common law unfair competition.
On October 17, 2014, Defendants Eric Ainsworth, Lisa Aldava, Serena Greenwood, Ruben Hernandez, Jr., Deana Schweitzer, and Catherine Sherman removed the action to this Court on the basis of federal question jurisdiction. (ECF No. 1). On October 23, 2014, Defendants filed a motion to dismiss the Complaint. (ECF No. 6). On December 17, 2014, the Court issued an Order, granting in part and denying in part the motion to dismiss. (ECF No. 10). The Court granted Defendant's motion to dismiss as to Plaintiff's breach of contract and breach of the implied covenant of good faith and fair dealing claims "to the extent these claims seek to enforce Paragraph Thirteen of the Employment Agreements." Id. at 11. In light of California Business & Professions Code section 16600, which provides, in relevant part, that "every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void[, ]" the Court found that "the Complaint fails to allege facts plausibly suggestive of a claim entitling the plaintiff to relief' for breach of Paragraph 13, i.e., facts showing that Paragraph 13 is enforceable." Cal. Bus. & Prof. Code § 16600; (ECF No. 10 at 10) (citations omitted).
On December 30, 2014, Defendants filed an Answer (ECF No. 12) and Counterclaims for Breach of Contract and Unfair Competition (ECF No. 13). On January 23, 2015, Plaintiff filed the Motion to Dismiss Counterclaims for Breach of Contract and Unfair Competition or, in the Alternative, for a More Definite Statement. (ECF No. 19). On February 9, 2015, Defendants and Counterclaimants ("Defendants") filed an opposition. (ECF No. 23). On February 23, 2015, Plaintiff filed a reply. (ECF No. 26).
II. Allegations of the Counterclaims (ECF No. 13)
"RHI is an employee staffing company. Counterclaimants are former employees of RHI who were compensated, in part, through commissions. The terms and conditions of RHI employee commissions are governed by a written contract referred to as RHI's compensation plan (the Contract')." (ECF No. 13 at 3). "Under the Contract, commissions are earned once the employee successfully places a candidate with a client and the client pays for the service being provided." Id. "Counterclaimants are informed and believe that RHI breached the Contract by failing to pay commissions earned." Id.
"RHI willfully undertook unfair acts to harm Counterclaimants and other similarly situated current and former RHI employees with knowledge of and in disregard of their rights and with the intention of causing harm. Specifically, RHI requires its employees to sign, and thereafter attempts to enforce, an employment agreement knowing it contains unlawful anticompetitive provisions in violation of California Business & Professions Code § 16600." Id. at 5. "RHI's conduct constitutes an unfair, unlawful, and fraudulent business practice in violation of California Business & Professions Code § 17200 et seq. " Id.
Defendants Aldava, Greenwood, and Sherman each assert separate counterclaims for breach of contract, and all Defendants assert a counterclaim for violation of California Business & Professions Code section 17200 ("UCL"). Defendants request damages, restitution and disgorgement, injunctive and declaratory relief, pre-judgment interest, attorneys' fees, and costs.
III. 12(b)(6) Standard
Federal Rule of Civil Procedure 12(b)(6) permits dismissal for "failure to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). Federal Rule of Civil Procedure 8(a) provides that "[a] pleading that states a claim for relief must contain... a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). Dismissal under Rule 12(b)(6) is appropriate where the complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory. See Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990).
"[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." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Fed.R.Civ.P. 8(a)). "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.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citation omitted). "[T]he tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. (citation omitted). "When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Id. at 679. "In ...