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Spivey Family Ltd. Partnership of Orlando v. Spivey

United States District Court, D. South Carolina, Florence Division

December 6, 2017

Spivey Family LTD Partnership of Orlando, Plaintiff,
B.L. “Larkin” Spivey, Jr., and B.L. “Bayliss” Spivey, III, Defendants.


          R. Bryan Harwell United States District Judge

         This matter is before the Court on Defendant B.L. “Larkin” Spivey, Jr. and Defendant B.L. “Bayliss” Spivey, III's motions [ECF Nos. 43 & 44] to strike the amended complaint and motions to dismiss the amended complaint. For the reasons stated below, the Court grants Defendants' motions to strike and grants in part and denies in part Defendants' motions to dismiss.

         I. Motions to Strike

         Defendants move to strike the amended complaint [ECF No. 42] because the amended complaint that was actually filed at docket entry number 42 is different from the proposed amended complaint that Plaintiff attached to his motion to amend.

         When a plaintiff requests leave to amend, the general practice is for the plaintiff to attach the proposed amended pleading to the motion so that the court can adequately assess whether leave to amend should be granted. See 6 Wright, Miller & Kane, Federal Practice and Procedure - Civil § 1485 (3d ed.). “As a matter of course, the proposed amended complaint becomes the official amended complaint once the court grants a party's motion.”[1] Bogdan v. Housing Auth. of the City of Winston-Salem, 2006 WL 3848693, at *3 (M.D. N.C. Dec. 29, 2006); Hetzel v. JP Morgan Chase Bank, N.A., 2014 WL 5475183, at *1 (E.D. N.C. Oct. 29, 2014) (recognizing “it is the normal course, upon the grant of a motion to amend, for the proposed amended complaint to be filed by the Clerk as the new amended complaint”).

         In this case, Plaintiff filed an amended complaint that differs from the version attached to the motion to amend. The Court did not grant Plaintiff leave to file the amended complaint that Plaintiff filed on May 12, 2017. Failure to file the same amended complaint as the one proposed is not only a violation of Rule 15, but in some cases, it can be grounds for sanctions. See Bogdan, 2006 WL 3848693, at *3 (citing Dover Steel Co. v. Hartford Accident & Indem. Co., 151 F.R.D. 570, 575 (D. Pa. 1993)). Accordingly, Defendants' motions to strike are granted.

         Plaintiff's amended complaint filed at ECF No. 42 is hereby stricken. The Clerk of Court is directed to file Plaintiff's proposed amended complaint [ECF No. 26-1] as the official amended complaint.

         II. Motions to Dismiss

         Defendants Larkin and Bayliss Spivey have also filed motions to dismiss. Both Defendants move to dismiss Plaintiff's claim for civil conspiracy arguing that Plaintiff failed to plead special damages. Defendant Bayliss Spivey also moves to dismiss all remaining causes of action against him arguing that no specific acts of misconduct are sufficiently pled.

         By way of background, this case involves a dispute over the management of a family owned company that has owned and operated various commercial properties in Horry County, South Carolina since 1996. [Amended Complaint, ECF No. 26-1 at ¶ 8]. The family owned company, Spivey Company, LLC, is a South Carolina limited liability company owned for the benefit of the Spivey family, consisting primarily of three brothers, Larkin Spivey, Richard A. Spivey, and Dr. James N. Spivey, and their respective spouses. Id. at ¶ 1. The members of Spivey Company, LLC are: 1) Plaintiff Spivey Family LTD Partnership of Orlando; 2) Spivey Holding Company, LLC; and 3) Richard A. Spivey and Karen Spivey. Id.

         Plaintiff Spivey Family LTD Partnership of Orlando generally alleges that Defendant Larkin Spivey, acting as manager of Spivey Company, LLC, acted under a conflict of interest and entered into a 35-year lease agreement (hereinafter the “Lease”) dated December 15, 2015 with his son Bayliss Spivey, acting as manager of Salt Creek Campground, LLC.[2] The Lease at issue involves the lease of Spivey Company campground property that was previously leased to Kampgrounds of America, Inc. (the “KOA”). Plaintiff contends the Spivey Company should have renegotiated a more profitable lease with KOA rather than leasing the property to Larkin's son's company, Salt Creek. Plaintiff alleges the Lease is not fair to the Spivey Company in that it diverts millions of dollars away from the Spivey Company in favor of Larkin and Bayliss Spivey over the lease period of 35 years. Plaintiff alleges the Lease was procured through fraudulent representations to the Plaintiff. Plaintiff alleges that the monthly rent amount being paid over the next 35 years by Larkin's son, Bayliss/Salt Creek, is far below the market rate, and the Plaintiff, which owns one third of Spivey Company, LLC will suffer losses in the millions of dollars.

         Plaintiff's amended complaint alleges causes of action for: 1) breach of fiduciary duty by Larkin Spivey; 2) breach of contract accompanied by fraudulent act by Larkin Spivey; 3) civil conspiracy as to Larkin Spivey and Bayliss Spivey; 4) aiding and abetting breach of fiduciary duties by Bayliss Spivey; and 5) unjust enrichment as to Bayliss Spivey. Plaintiff seeks a finding that at all times pertinent to the Lease transaction that Larkin Spivey was operating under a conflict of interest and in violation of his duty of loyalty to the Spivey Company. Plaintiff also seeks a finding that the material facts of the transaction with respect to the Lease were not disclosed or known to the members authorized to vote, and the transaction with respect to the Lease was not fair to the Spivey Company. Plaintiff seeks damages in the amount of the lost profits/distributions that would have inured to the Plaintiff had the Defendants negotiated a fair market value lease or determined another use of the campground property that was fair to the Spivey Company. Plaintiff also requests it be awarded attorney fees for the cost of pursuing this action.

         Rule 12(b)(6) Standard

         When deciding a motion to dismiss made under Federal Rule of Civil Procedure 12(b)(6), the Court must accept all well-pled facts alleged in the complaint as true and draw all reasonable inferences in the plaintiff's favor. Nemet Chevrolet, Ltd. v., Inc., 591 F.3d 250, 253 (4th Cir. 2009). A complaint must state a “plausible claim for relief” to survive a 12(b)(6) motion to dismiss. Walters v. McMahen, 684 F.3d 435, 439 (4th Cir. 2012) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009)). The Court will not dismiss the plaintiff's complaint so long as he provides adequate detail about his claims to show he has a “more-than-conceivable chance of success on the merits.” Owens v. Baltimore City State's Attorneys Office, 767 F.3d 379, 396 (4th Cir. 2014) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “Once a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint.” Twombly, 550 U.S. at 563. A complaint will survive a motion to dismiss if it contains “enough facts to state a claim to relief that is plausible on its face.” Id. at 570. ...

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