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Monocle, Inc. v. Online Gun Dealer, LLC

United States District Court, E.D. Missouri, Eastern Division

December 14, 2017

MONOCLE, INC., d/b/a BLUE STINGRAY, Plaintiff,
v.
ONLINE GUN DEALER, LLC, d/b/a MR. GUN DEALER, Defendant.

          MEMORANDUM AND ORDER

          PATRICIA L. COHEN, UNITED STATES MAGISTRATE JUDGE

         This matter is before the Court on Defendant Online Gun Dealer, LLC, d/b/a Mr. Gun Dealer's motions (1) to strike the demand of Plaintiff Monocle, Inc. d/b/a Blue Stingray for an award of attorneys' fees [ECF No. 7] and (2) for leave to file a counterclaim [ECF No. 10]. Plaintiff has not responded to Defendant's motions.

         Background

         Plaintiff originally filed this lawsuit in the Circuit Court for the City of St. Louis, Missouri.[1] Defendant removed the lawsuit to this Court on the basis of this Court's original diversity jurisdiction.[2] 28 U.S.C. §§ 1332 and 1441(a).

         In its petition, Plaintiff alleges the parties entered into a written contract in August 2016 (referred to as “the Initial Contract”) for Plaintiff to provide to Defendant and support Defendant's use of “the Odoo Enterprise Resource Program (ERP).”[3] The parties allegedly modified the Initial Contract to include, in relevant part, Plaintiff's sale to Defendant of “the Magento ecommerce system (Ecommerce)” and “numerous modifications made by Defendant to both the ERP and Ecommerce systems (Contract).”[4] Plaintiff further alleges that “[t]he Initial Contract . . . states in pertinent part: In case collection proves necessary, [Defendant] agrees to pay all fees incurred as a result of the collection process.”[5] Defendant allegedly owes Plaintiff a total of $125, 556.45 for products and services Plaintiff provided under the parties' agreement.[6]The alleged total amount due includes (1) $73, 259.00 for products and services Plaintiff provided during the period August 4, 2016 through December 6, 2016 that Defendant initially paid by credit card and then had the payments reversed; and (2) $52, 297.45 billed by Plaintiff on December 28, 2016 that Defendant has not yet paid.[7]

         In its three-count petition, Plaintiff seeks monetary relief from Defendant based on breach of contract (Count I), quantum meruit (Count II), and promissory estoppel (Count III). Specifically, in each count, Plaintiff seeks a judgment in its favor for the total amount of $125, 556.45 allegedly due from Defendant, plus costs, prejudgment interest, and attorney's fees.[8]

         Motion to strike attorney's fees

         Pursuant to Federal Rule of Civil Procedure 12(f), Defendant moves to strike Plaintiff's demand for an award of attorney's fees in each of the three counts. Defendant argues “[a] prayer for relief not available under the applicable law, or which asserts a damage claim in excess of the maximum recovery permitted by law, is properly subject to a motion to strike. Johnson v. Metropolitan Sewer Dist., 926 F.Supp. 874, 875 (E.D. Mo. 1996).”[9]

         Rule 12(f) provides that a “court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.”[10] While district courts have “broad discretion” in resolving a motion to strike under Rule 12(f), the United States Court of Appeals for the Eighth Circuit views motions to strike “with disfavor and [recognizes motions to strike] are infrequently granted.” Stanbury Law Firm, P.A. v. Internal Revenue Serv., 221 F.3d 1059, 1063 (8th Cir. 2000) (per curiam) (internal quotation marks omitted) (quoting Lunsford v. United States, 570 F.2d 221, 229 (8th Cir. 1977)). This Court has granted a motion to strike a plaintiff's demand for attorney's fees when there is no statutory or contractual basis for an attorney's fee award. Fainer v. State Farm Mut. Auto. Ins. Co., No. 4:08cv01536 AGF, 2008 WL 5263779 (ED. Mo. Dec. 18, 2008) (granting motion to strike the plaintiff's demand for attorney's fees because the plaintiff did not specify “any contractual or statutory basis for attorney's fees, [and did not] assert[] a claim under which such fees might be recovered”).[11]

         “In a diversity action, state law governs the availability of attorney's fees where no conflicting federal statute or court rule applies.” FutureFuel Chem. Co. v. Lonza, Inc., 756 F.3d 641, 649 (8th Cir. 2014) (citing Burlington N. R.R. Co. v. Farmers Union Oil Co., 207 F.3d 526, 534 (8th Cir. 2000)); accord East Iowa Plastics, Inc. v. PI, Inc., 832 F.3d 899, 908 (8th Cir. 2016). Because no conflicting federal statute or rule applies to the award of attorney's fees in this lawsuit, the Court looks to Missouri authority to resolve whether Plaintiff may obtain an award of attorney's fees on each of his three state law claims.

         Defendant argues Plaintiff is not entitled to attorney's fees for the breach of contract claim (Count I) because the parties' contract does not have a provision for attorney's fees.[12] In the petition, however, Plaintiff alleges that the parties' Initial Contract provides that “[i]n case collection proves necessary, [Defendant] agrees to pay all fees incurred as a result of the collection process.”[13] The contract attached to the petition includes this provision.[14]

         Missouri case law holds that a party must pay “attorney's fees in addition to the principal and interest due” when an agreement provides that “any collection fees incurred . . . would be paid” by the party obligated to pay unpaid amounts due under the agreement. Ulreich v. Kreutz, 876 S.W.2d 726, 730 (Mo.Ct.App. 1994) (citing Henty Constr. Co. v. Hall, 783 S.W.2d 412, 417-18 (Mo.Ct.App. 1989)). Here, the parties' agreement requires the payment of “all fees incurred as a result of the collection process, ” which arguably includes attorney's fees under Ulreich, supra. At this stage of the proceedings, the Court denies Defendant's motion to strike Plaintiff's demand for an award of attorney's fees from the breach of contract claim.

         Defendant also moves to strike Plaintiff's demand for attorney's fees in the quantum meruit claim (Count II) on the ground that quantum meruit “is based in tort and not eligible for attorney's fees.”[15] Defendant does not cite authority in support of this argument.

         Under Missouri law, “[q]uantum meruit is a remedy for the enforcement of a quasi-contractual obligation and is based primarily on the principle of unjust enrichment.” RadianceCapital Receivables Eighteen, LLC v. Concannon, Case No. 2:16-cv-04280-NKL, 2017 WL 4169629, at *10 (W.D. Mo. Sept. 20, 2017). A plaintiff may plead a quantum meruit claim alternatively to a breach of contract claim. Id. When, however, “there is an enforceable contract governing the rights and obligations of the parties” there is “no cause of action for quantum meruit . . . under Missouri law.” Id. (citing Burrus v. HBE Corp., 211 S.W.3d 613, 619 (Mo.Ct.App. 2006)). Based on this authority, including the summary of the elements of a quantum meruit claim set forth in Concannon, supra, this Court characterizes a quantum meruit claim under Missouri law as more akin to a contract claim than to a tort claim. Because ...


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