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Advanced Commercial Credit International (ACI) Limited v. Citisculpt, LLC

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

May 10, 2018

Advanced Commercial Credit International (ACI) Limited, a Virginia Corporation d/b/a ACI Capital Partners, Plaintiff,
v.
CitiSculpt, LLC, et al., Defendants.

          OPINION AND ORDER

          A. MARVIN QUATTLEBAUM, JR. UNITED STATES DISTRICT JUDGE.

         This matter is before the Court on Defendants CitiSculpt SC, LLC, CS-10 South Academy Street, LLC, and 10 Academy Street, LLC's Motion to Dismiss the First Amended Complaint (ECF No. 51); Defendant CitiSculpt, LLC's Motion to Dismiss the First Amended Complaint (ECF No. 53); Defendants Eastern Federal Corporation, EFC Management Company, Inc., and EFC Dynasty Investments, LLC's Motion to Dismiss (ECF No. 68); and Plaintiff Advanced Commercial Credit International (ACI) Limited's (“ACI”) Motion for Partial Summary Judgment (ECF No. 75). This Court held a hearing on the motions on May 1, 2018 and, at that time, stated its rulings denying ACI's Motion for Partial Summary Judgment (ECF No. 75) and Defendant CitiSculpt, LLC's Motion to Dismiss (ECF No. 51.) The Court has carefully considered the briefing and arguments submitted by the parties, as well as the entire record in this case. For the reasons set forth herein, the Court grants Defendants CitiSculpt SC, LLC, CS-10 South Academy Street, LLC, and 10 Academy Street, LLC's Motion to Dismiss the First Amended Complaint (ECF No. 51), and Defendants Eastern Federal Corporation, EFC Management Company, Inc., and EFC Dynasty Investments, LLC's Motion to Dismiss (ECF No. 68), but without prejudice to ACI and with leave granted to ACI to replead claims through an amended complaint that is consistent with this order.

         BACKGROUND AND PROCEDURAL HISTORY

         CitiSculpt, LLC (“CitiSculpt”) filed this action on or around January 9, 2017, based on diversity jurisdiction pursuant to 28 U.S.C. § 1332 against ACI concerning the purchase of certain real property (“10 S. Academy Street”) in South Carolina. (ECF No. 1 at 2.) According to the initial complaint, CitiSculpt and ACI entered into a Letter of Interest/Term Sheet Agreement (“Term Sheet Agreement”) on or around November 16, 2016, concerning the potential purchase of the 10 S. Academy Street real estate. (ECF No. 1 at ¶¶11-15.) CitiSculpt asserted causes of action for fraud, negligent misrepresentation, and breach of contract concerning the failed funding deal.

         ACI filed its answer on January 31, 2017, and also raised several causes of action in a counterclaim against CitiSculpt. (ECF No. 8.) ACI also filed a Motion to Dismiss CitiSculpt's Complaint. (ECF No. 10.) On February 17, 2017, United States District Judge Bruce Howe Hendricks issued an order dismissing CitiSculpt's causes of action against ACI without prejudice. (ECF No. 19, 23.) ACI's counterclaim against CitiSculpt was reinstated, and the parties were realigned pursuant to an April 7, 2017, order such that ACI was designated as the plaintiff. (ECF No. 34.) Thereafter, ACI was granted leave to refile its complaint against CitiSculpt as well as several defendant entities and alleged subsidiaries of CitiSculpt. The allegations concern CitiSculpt's procurement of funding for the 10 S. Academy Street real estate through a third-party ACI claims to have introduced to CitiSculpt (a “revealed contact”), thereby, according to ACI, entitling ACI to a fee pursuant to the Term Sheet Agreement. (ECF No. 41 at ¶ 64.) ACI asserted a first cause of action for breach of contract against CitiSculpt only, a second cause of action for tortious interference with prospective economic opportunities against each defendant except CitiSculpt, and a third cause of action for statutory conspiracy against all Defendants. ACI asserted each of these claims pursuant to Virginia law. (ECF No. 41 at ¶¶ 66-72, 76, 86-88.)

         On July 26, 2017, Defendants CitiSculpt SC, LLC, CS-10 South Academy Street, LLC, and 10 Academy Street, LLC (collectively referred to hereinafter as the “CitiSculpt Subsidiaries”) filed a motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure on the grounds that ACI failed to state a claim for tortious interference with a prospective business relationship or conspiracy under Virginia law. (ECF No. 51.) On August 2, 2017, CitiSculpt filed a motion to dismiss pursuant to Rule 12(b)(6), arguing that the alleged contract is “illusory” and, therefore, could not be breached as a matter of law. (ECF No. 53.) On August 29, 2017, the Defendants Eastern Federal Corporation, EFC Management Company, Inc., and EFC Dynasty Investments, LLC (collectively referred to hereinafter as the “Eastern Defendants”) filed a motion to dismiss on the grounds that South Carolina law, rather than Virginia law, applies to any claims asserted against those defendants. (ECF No. 68.) Finally, ACI filed a Motion for Partial Summary Judgment asking this Court to find as a matter of law that the Term Sheet Agreement is not “illusory.” (ECF No. 75.) Responses and replies have been filed in association with the above-referenced motions and the motions are ripe for review.

         LEGAL STANDARDS

         Motion to Dismiss Standard

         A plaintiff's complaint should set forth “a short and plain statement . . . showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Rule 8 “does not require ‘detailed factual allegations, ' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). “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.'” Id. (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. (quoting Twombly, 550 U.S. at 556)). In considering a motion to dismiss under Rule 12(b)(6), a court “accepts all well-pled facts as true and construes these facts in the light most favorable to the plaintiff. . . .” Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., 591 F.3d 250, 255 (4th Cir. 2009). A court should grant a Rule 12(b)(6) motion if, “after accepting all well-pleaded allegations in the plaintiff's complaint as true and drawing all reasonable factual inferences from those facts in the plaintiff's favor, it appears certain that the plaintiff cannot prove any set of facts in support of his claim entitling him to relief.” Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th Cir. 1999).

         Summary Judgment Standard

         A court shall grant summary judgment if the moving party shows that there is no genuine dispute as to any material fact and the party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The judge is not to weigh the evidence, but rather to determine if there is a genuine issue of fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). If no material factual disputes remain, then summary judgment should be granted against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which the party bears the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). All evidence should be viewed in the light most favorable to the non-moving party. See Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 123-24 (4th Cir. 1990). Thus, at the summary judgment phase, “[t]he pertinent inquiry is whether there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party.” Variety Stores, Inc. v. Wal-Mart Stores, Inc., No. 17-1503, 2018 WL 1916320, at *3 (4th Cir. Apr. 24, 2018)(internal citation and quotation marks omitted).

         DISCUSSION

         First, the Court will address the two motions ruled upon during the May 1, 2018 hearing:

         ACI's Motion for ...


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