United States District Court, E.D. Missouri, Eastern Division
For Mark Boswell, David Lutton, individually, and on behalf of all others similarly situated, Plaintiffs: Timothy Coffield, LEAD ATTORNEY, Keswick, VA.
For Panera Bread Company, a Delaware Corporation, Panera LLC, a Delaware Limited Liability Company, Defendants: Patrick F. Hulla, LEAD ATTORNEY, Jennifer Kate Oldvader, Justin Matthew Dean, OGLETREE AND DEAKINS, Kansas City, MO.
MEMORANDUM AND ORDER
AUDREY G. FLEISSIG, UNITED STATES DISTRICT JUDGE.
This matter is before the Court on the motions of Defendant Panera, LLC and its parent company, Panera Bread Company, to obtain a more definite statement of one count of the lawsuit filed by Plaintiffs, and to dismiss another count for failure to state a claim upon which relief can be granted. Plaintiffs Mark Boswell and David Lutton, both former Joint Venture General Managers (" JVGMs" ) for Panera in North Carolina, filed this action on behalf of themselves and a putative class of other Panera JVGMs. Plaintiffs base their complaint on Defendants' alleged misrepresentations about, and inadequate payment of, " one-time JV GM Buyout" payments contemplated in Plaintiffs' employment contracts. (Doc. No. 1 at 1.) Defendants argue that the second count of the complaint, a class count alleging fraud in the inducement, was not pleaded with the particularity required by Federal Rule of Civil Procedure 9(b), and request the Court order Plaintiffs to file a more definite statement. Further, Defendants argue that the third count of the complaint, a class count alleging conversion, is not allowed under controlling Missouri law and should be dismissed under Rule 12(b)(6). For the reasons set forth below, the Court will deny Defendants' motion for a more definite statement and grant their motion to dismiss.
Plaintiffs' action, filed on October 29, 2014, arises out of Defendants' alleged failure to pay Plaintiffs the full sum owed to them under their employment contracts and under Panera's standardized " Joint Venture General Manager Compensation Plan" (the " Plan" ). Id. Plaintiffs and putative
class members were all JVGMs of Panera. As alleged in the complaint, Plaintiffs and Defendants entered into a five-year compensation agreement whereby Plaintiffs would manage the daily operations of company-owned cafes and receive a small annual salary. At the end of the five years, Plaintiffs would receive a one-time payment from Defendants, the amount of which was to be determined in accordance with specific provisions set forth in the Plan, and which turned on the profitability of the managed cafes. Plaintiffs allege that without their consent, Defendants modified the Plan to include a cap on the maximum amount that JVGMs could receive in the one-time payment, withholding money Plaintiffs would have been entitled to under the original Plan as it existed at the time of signing. Plaintiffs claim that these actions constitute material breaches of contract, fraud, and conversion of Plaintiffs' property under Missouri law. The complaint asserts both individual and class claims on these theories, and prays for damages and injunctive relief.
On December 12, 2014, Defendants filed their answer to Plaintiffs' complaint. (Doc. No. 9.) Later that day, Defendants filed two motions. First, Defendants filed a motion for a more definite statement regarding the second count of the complaint, a putative class claim for fraud, under Federal Rule of Civil Procedure 12(e). (Doc. No. 10.) Defendants argue that the complaint fails to sufficiently identify the " who, what, where, when, and how" of the alleged fraud, leaving the claim so ambiguous that Defendants cannot reasonably respond. Id. at 2. Specifically, Defendants contend that Plaintiffs have failed to identify any alleged misrepresentation made at the time of contracting. Plaintiffs respond that the allegations are sufficiently particular, and to the extent that the " who, what, where, when, and how" are not directly stated in the complaint, they are demonstrated by Plaintiffs' employment agreements and executed Plans, which are exhibits to the complaint. (Doc. No. 1, Ex. 1-2.) Further, Plaintiffs contend that the complaint specifically alleges a misrepresentation at the time of contracting in that it alleges Defendants never intended to honor the Plan.
Defendants also filed a motion to dismiss the third count of the complaint, a putative class claim for conversion, under Federal Rule of Civil Procedure 12(b)(6). (Doc. No. 11.) In support of this motion, Defendants cite case law which states that in Missouri, conversion is not an appropriate action to bring to recover money. Rather, a claim of conversion is used to recover tangible property. Plaintiffs respond that these facts fall under an exception to the doctrine cited by Defendants. (Doc. No. 18.) Plaintiffs contend that the monies in question are identifiable sums wrongly appropriated by Defendants, which entitles them to treatment as " specific chattel" and which may be the subject of a claim for wrongful conversion under Missouri law. Id. at 5. Defendants argue that the " specific chattel" exception only applies to funds placed into the custody of another for a
specific purpose, and that these conditions are not met in this ...