United States District Court, S.D. California
ORDER GRANTING IN PART AND DENYING IN PART
PLAINTIFF'S MOTION TO DISMISS DEFENDANTS'
COUNTERCLAIMS WITH LEAVE TO AMEND [DOC. NO. 23.]
MARILYN L. HUFF, JUDGE.
22, 2019, Plaintiff Scripps Health filed a motion to dismiss
Defendants nThrive Revenue Systems, LLC and nThrive,
Inc.'s counterclaims. (Doc. No. 23.) On August 20, 2019,
the Court took the motion to dismiss under submission. (Doc.
No. 29.) On August 26, 2019, nThrive filed its response in
opposition to Scripps's motion to dismiss. (Doc. No. 31.)
On August 30, 2019, Scripps filed its reply. (Doc. No. 34.)
For the reasons below, the Court grants in part and denies in
part Scripps's motion to dismiss.
following facts are taken from the allegations in
Plaintiff's complaint. Plaintiff Scripps is a nonprofit
health care system with four hospitals and twenty-eight
outpatient facilities. (Doc. No. 1, Compl. ¶ 5.) Scripps
entered in an agreement with Defendant nThrive, effective
September 25, 2017, for the management, recovery, and
collection of Scripps's legacy accounts receivables.
(Id. ¶¶ 19, 31.)
alleges that nThrive did not perform the services required
under the agreement in accord with contractual or industry
standards. (Id. ¶ 39.) Scripps further alleges,
among other things, that nThrive “secretly and
surreptitiously assigned, subcontract, and/or
delegated” some or all of its obligations under the
agreement to third-party Formativ Health, despite the
inclusion of an anti-assignment clause in the agreement.
(Id. ¶¶ 42-44.)
April 24, 2019, Scripps filed a complaint against nThrive and
Formativ Health, alleging claims for: (1) fraud and deceit;
(2) negligent misrepresentation; (3) aiding and abetting
fraud; (4) conspiracy to commit fraud; (5) intentional
interference with contractual relations; (6) intentional
interference with prospective economic advantage; (7) breach
of contract; (8) breach of the covenant of good faith and
fair dealing; (9) negligence; (10) unjust enrichment; (11)
demand for accounting; and (12) unfair business practices in
violation of California Business and Professions Code §
17200 et seq. (Doc. No. 1.)
28, 2019, Formativ Health filed an answer to the complaint.
(Doc. No. 8.) On July 1, 2019, nThrive filed an answer to the
complaint and counterclaims against Scripps, alleging
counterclaims for: (1) breach of contract; (2) breach of the
implied covenant of good faith and fair dealing; (3)
negligent misrepresentation; and (4) unjust enrichment. (Doc.
Nos. 11, 12.) By the present motion, Scripps moves pursuant
to Federal Rule of Civil Procedure 12(b)(6) to dismiss
nThrive's counterclaims for breach of the implied
covenant of good faith and fair dealing, negligent
misrepresentation, and unjust enrichment. (Doc. No. 23.)
Rule 12(b)(6) Motion to Dismiss
motion to dismiss under Federal Rule of Civil Procedure
12(b)(6) tests the legal sufficiency of the pleadings and
allows a court to dismiss a complaint if the plaintiff has
failed to state a claim upon which relief can be granted.
See Conservation Force v. Salazar, 646 F.3d 1240,
1241 (9th Cir. 2011). Federal Rule of Civil Procedure 8(a)(2)
requires that a pleading stating a claim for relief
containing “a short and plain statement of the claim
showing that the pleader is entitled to relief.” The
function of this pleading requirement is to “give the
defendant fair notice of what the . . . claim is and the
grounds upon which it rests.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007).
complaint will survive a Rule 12(b)(6) motion to dismiss if
it contains “enough facts to state a claim to relief
that is plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). “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.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
“A pleading that offers ‘labels and
conclusions' or ‘a formulaic recitation of the
elements of a cause of action will not do.'”
Id. (quoting Twombly, 550 U.S. at 555).
“Nor does a complaint suffice if it tenders
‘naked assertion[s]' devoid of ‘further
factual enhancement.'” Id. (quoting
Twombly, 550 U.S. at 557). Accordingly, dismissal
for failure to state a claim is proper where the claim
“lacks a cognizable legal theory or sufficient facts to
support a cognizable legal theory.” Mendiondo v.
Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir.
reviewing a Rule 12(b)(6) motion to dismiss, a district court
must accept as true all facts alleged in the complaint, and
draw all reasonable inferences in favor of the claimant.
See Retail Prop. Trust v. United Bhd. of Carpenters &
Joiners of Am., 768 F.3d 938, 945 (9th Cir. 2014). But,
a court need not accept “legal conclusions” as
true. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Further, it is improper for a court to assume the claimant
“can prove facts which it has not alleged or that the
defendants have violated the . . . laws in ways that have not
been alleged.” Associated Gen. Contractors of Cal.,
Inc. v. Cal. State Council of Carpenters, 459 U.S. 519,