United States District Court, N.D. California
ORDER RE: PLAINTIFF'S MOTION TO DISMISS
DEFENDANT'S COUNTERCLAIM FOR CONCEALMENT RE: DKT. NO.
28
JACQUELINE SCOTT CORLEY UNITED STATES MAGISTRATE JUDGE.
Sprint
Spectrum Realty Company, LLC (“Sprint”) sues
William F. Hartkopf, Jr. seeking declaratory judgment and
other relief for breach of contract and breach of good faith
and fair dealing arising out of a lease of real property
owned by Mr. Hartkopf. (Dkt. No. 1.)[1] Mr. Hartkopf brings
counterclaims against Sprint seeking declaratory judgment and
other relief for breach of contract, breach of good faith and
fair dealing, unjust enrichment, and concealment. (Dkt. No.
27.) Now before the Court is Sprint's motion to dismiss
Mr. Hartkopf's amended counterclaim for concealment
pursuant to Federal Rule of Civil Procedure
12(b)(6).[2] (Dkt. No. 28.) After careful consideration
of the parties' briefing and having had the benefit of
oral argument on November 21, 2019, the Court GRANTS
Sprint's motion. Mr. Hartkopf fails to plead facts that
plausibly suggest that Sprint concealed the material fact at
issue.
BACKGROUND
I.
Counterclaim Allegations
The
gravamen of Mr. Hartkopf's concealment counterclaim is
that Sprint did not disclose that its communications
equipment, which Sprint installed on the roof of a building
owned by Mr. Hartkopf pursuant to a lease agreement between
the parties, occupied more than 300 square feet of the
subject property.
A.
The Agreement
Mr.
Hartkopf owns a building located in Fremont, California (the
“Property”). (Dkt. No. 27 at ¶ 8.) In August
1997, Mr. Hartkopf and Sprint entered into a “PCS Site
Agreement” (the “Agreement”), as landlord
and tenant, respectively. (Id. at ¶ 9.)
Pursuant to the Agreement, Mr. Hartkopf leased to Sprint
certain space on the Property's roof (the
“Site”) for $1, 300.00 per month “for the
purpose of installing, removing, replacing, maintaining[, ]
and operating a personal communications service systems
family” (the “Facility”). (Id. at
¶ 10; see also Dkt. No. 27, Ex. A at 13 ¶
3.) The Site consists of: (1) “[b]uilding exterior
space for attachment of antennas”; (2)
“[b]uilding exterior space for placement of base
station equipment”; and (3) “[s]pace required for
cable runs.” (Dkt. No. 27, Ex. A at 13 ¶ 1.)
The
Agreement's description of the Site states that it
consists of:
Space on the exterior of the [Property] . . . for at least
three [ ] sectors of antennas as depicted in Exhibit A-2;
approximately 300 square feet, measuring approximately on the
rooftop of the [Property] for Sprint Spectrum's equipment
as depicted in Exhibit A-2; space for utility runs connecting
Sprint Spectrum's equipment with the nearest available
utility services; space for coaxial cables connecting Sprint
Spectrum's equipment and the antennas; and, access to the
antennas, Sprint Spectrum's equipment, utility runs and
coaxial cables.
(Id. at 14.) Mr. Hartkopf agreed to the terms of the
Agreement “with the express understanding that the
space being leased to Sprint consisted of 300 square feet for
all of Sprint's equipment.” (Dkt. No. 27 at ¶
14.) Sprint has at all times relevant to the instant action,
however, known “that the equipment it planned to
install required more than the 300 square feet identified in
the [Agreement], ” and has failed to disclose that fact
to Mr. Hartkopf. (Id. at ¶ 15.)
B.
The 2011 Amendment and Subsequent Modifications
In
December 2011, the parties entered into “Amendment No.
One” to the Agreement (“2011 Amendment” or
“Amendment”). (Id. at ¶ 18; see
also Dkt. No. 1-2, Ex. B at 2-8.)[3] The Amendment
modified the Agreement only to the extent it “permitted
Sprint to conduct necessary work to prepare, maintain[, ] and
alter the Site to install or otherwise modify [certain]
[i]mprovements.” (Dkt. No. 27 at ¶¶ 19-20.)
As consideration for the modifications, “the Amendment
increased the monthly rent by $200.00.” (Id.
at ¶ 21.) However, the Amendment did not increase the
size of the Site set forth in the Agreement and Mr. Hartkopf
agreed to the Amendment with that understanding.
(Id. at ¶¶ 22-23.) Nor have the parties
executed any subsequent amendments that provide Sprint with
more space than originally agreed upon. (Id. at
¶ 24.)
Subsequent
to the 2011 Amendment, Mr. Hartkopf agreed to allow
“Sprint to make physical modifications to the Site,
” upon Sprint's request and pursuant to the terms
of the Agreement. (Id. at ¶¶ 25-26.)
“Sprint affirmed and represented in numerous
correspondences with [Mr.] Hartkopf that any modifications or
improvements at the Site would not increase Sprint's
lease space” set forth in the Agreement. (Id.
at ¶ 27.) Sprint knew, however, that its requested
modifications and improvements “required more than . .
. 300 square feet” and did not disclose that fact to
Mr. Hartkopf. (Id. at ¶¶ 28-29.)
C.
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