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Crew Tile Distribution, Inc. v. Porcelanosa Los Angeles, Inc.

United States District Court, D. Colorado

February 5, 2015

CREW TILE DISTRIBUTION, INC., Plaintiff,
v.
PORCELANOSA LOS ANGELES, INC., d/b/a PORCELANOSA USA, PORCELANOSA NEW YORK, INC., d/b/a PORCELANOSA USA, PORCELANOSA TEXAS, INC., d/b/a PORCELANOSA USA, and PORVEN, LTD., agent of PORCELANOSA USA, Defendants.

ORDER DENYING DEFENDANTS' MOTION TO DISMISS

WILLIAM J. MARTÍNEZ, District Judge.

Plaintiff Crew Tile Distribution, Inc. ("Plaintiff") brings this breach of contract action against Defendants Porcelanosa Los Angeles, Inc. ("Porcelanosa LA"), Porcelanosa New York, Inc., Porcelanosa Texas, Inc., and Porven, Ltd. (collectively "Defendants"), all allegedly doing business as or serving as an agent for Porcelanosa, USA. (Second Amended Complaint ("SAC") (ECF No. 85).) This matter is before the Court on Defendants' Amended Motion to Dismiss Pursuant to Fed.R.Civ.P. 12(b)(6) ("Motion"). (ECF No. 26.) For the reasons set forth below, the Motion is denied.

I. LEGAL STANDARD

Under Federal Rule of Civil Procedure 12(b)(6), a defendant may move to dismiss a claim in a complaint for "failure to state a claim upon which relief can be granted." In evaluating such a motion, a court must "assume the truth of the plaintiff's well-pleaded factual allegations and view them in the light most favorable to the plaintiff." Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007). In ruling on such a motion, the dispositive inquiry is "whether the complaint contains enough facts to state a claim to relief that is plausible on its face.'" Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Granting a motion to dismiss "is a harsh remedy which must be cautiously studied, not only to effectuate the spirit of the liberal rules of pleading but also to protect the interests of justice." Dias v. City & Cnty. of Denver, 567 F.3d 1169, 1178 (10th Cir. 2009) (quotation marks omitted). "Thus, a well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and that a recovery is very remote and unlikely.'" Id. (quoting Twombly, 550 U.S. at 556).

II. BACKGROUND

The relevant facts, as pled in the SAC, are as follows.

Defendants Porcelanosa LA, Porcelanosa New York, and Porcelanosa Texas are, respectively, California, New York, and Texas corporations, which allegedly all conduct business by and through the unregistered d/b/a or trade name "Porcelanosa USA". (SAC ¶¶ 2-7, 25.) Defendant Porven, Ltd. is a Delaware corporation that is a holding company for the other three Defendants, and also acts as an agent of Porcelanosa USA. ( Id. ¶¶ 5-7.) All four Defendants are subsidiaries of Porcelanosa Grupo, an international tile and stone company from Spain, that sell and market Porcelanosa products in the United States. ( Id. ¶ 6.)

On December 8, 2009, Plaintiff entered into a Distributor Agreement (the "Agreement") with Porcelanosa USA under which Plaintiff was made the exclusive distributor for Porcelanosa products in Colorado, excluding the City of Aspen and Pitkin County. (SAC ¶¶ 12, 14; Agreement (ECF No. 85-1) p. 1.) The Agreement was signed by Jack Handley, an agent of Porcelanosa LA, and was witnessed by Paco Montilla, the General Manager and West Coast Director of Porcelanosa LA. (SAC ¶ 13; Agreement p. 7.) The Agreement contains a Colorado choice of law provision. (Agreement p. 6.)

From the date the Agreement was executed, Plaintiff acted as a distributor for Porcelanosa products, including building a showroom and selling Porcelanosa products to customers. (SAC ¶¶ 52, 54-59.) In compliance with the Agreement, Porcelanosa LA utilized Plaintiff as its exclusive distributor until 2013 when Porcelanosa LA first breached the Agreement. ( Id. ¶¶ 60-67.) Plaintiff alleges upon information and belief that beginning in 2013, Porcelanosa LA, Porcelanosa New York, and Porcelanosa Texas all sold and distributed Porcelanosa products in Colorado and to Colorado customers without using Plaintiff as the distributor. ( Id. ¶¶ 68-69.) Defendants allegedly agreed to take these actions despite their direct interference with the Agreement. ( Id. ) Porcelanosa Texas, which was formed in 2012, announced in October 2013 that it would establish its own showroom in Denver, Colorado to distribute Porcelanosa products. ( Id. ¶¶ 64, 69.) After Plaintiff objected in writing to Porcelanosa Texas's conduct, Porcelanosa Texas sent letters dated October 31, 2013 to Plaintiff's customers stating: "Porcelanosa USA is proud to announce that the Colorado Market will now be serviced by Porcelanosa Texas as of November 1, 2013.... Going forward, as of November 1, 2013, any orders and balances will be generated from our location in Dallas, Texas." ( Id. ¶¶ 70-71; ECF No. 85-2.)

In a letter dated January 7, 2014, Plaintiff received a letter from Porcelanosa New York, signed by "Manuel Prior, Director, Porcelanosa USA", which purported to terminate its Exhibitor Agreement dated March 29, 2010. (SAC ¶ 73; ECF No. 85-3.) As a result of the termination of the Exhibitor Agreement, Plaintiff was forced to remove display racks it had in multiple customers' showrooms. ( Id. ) Later in January 2014, pursuant to Defendants' agreement among themselves, Porcelanosa LA and Porcelanosa New York began blocking Plaintiff's ability to place new orders for products, and Porcelanosa Texas contacted Plaintiff's customers to re-place any pending purchase orders with Porcelanosa Texas. ( Id. ¶¶ 74-75.) Porcelanosa Texas opened its Denver showroom in March 2014. ( Id. ¶ 76; ECF No. 85-4.)

Plaintiff initiated this action on November 22, 2013 (ECF No. 1), and filed an Amended Complaint on April 11, 2014, bringing breach of contract claims and, in the alternative, claims for equitable relief, tortious interference with contract and with business advantage, and civil conspiracy. (ECF No. 23.) The instant Motion was filed on April 18, 2014. (ECF No. 26.) Plaintiff filed a Response (ECF No. 34) and Defendants filed a Reply (ECF No. 43). On December 23, 2014, while the Motion was pending, Plaintiff filed an Unopposed Motion for Leave to File a Second Amended Complaint, which indicated that the parties agreed that the proposed amendments did not render the Motion to Dismiss moot. (ECF No. 83.) The Motion for Leave to File the SAC was granted on February 3, 2015. (ECF No. 91.) The SAC (ECF No. 85) is therefore the operative Complaint.

III. ANALYSIS

Defendants move for dismissal of all of Plaintiff's claims on the basis that Plaintiff has failed to plausibly allege that any of them is a party to the Agreement. (ECF No. 26 at 4-5.) Defendants assert that, because all of Plaintiff's claims depend on the alleged breach of the Agreement, all claims fail in the absence of a viable breach of contract claim. ( ...


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