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Landmark Infrastructure Holding Company LLC v. R.E.D. Investments, LLC

United States District Court, W.D. Missouri, Central Division

August 20, 2019

LANDMARK INFRASTRUCTURE HOLDING COMPANY, LLC, Plaintiff,
v.
R.E.D. INVESTMENTS, LLC, et al., Defendants.

          ORDER

          NANETTE K. LAUGHREY UNITED STATES DISTRICT JUDGE.

         Defendant Debora Johnson moves pursuant to Federal Rules of Civil Procedure 12(b)(6) and 9(b) to dismiss Count V of the complaint by plaintiff Landmark Infrastructure Holding Company, LLC for failure to state a claim and for failure to plead with sufficient particularity. For the reasons discussed below, the motion to dismiss is denied.

         I. Procedural Background

         On April 2, 2015, Landmark filed suit against R.E.D. Investments, LLC and Bobby Van Stavern for misrepresentations made in connection with the sale of a billboard lease and easement. Landmark Infrastructure Holding Company, LLC v. R.E.D. Investments, LLC and Bobby Van Stavern (“R.E.D. I”), No. 2:15-cv-04064-NKL. On January 19, 2018, following a jury trial, the Court entered judgment in Landmark's favor in the amount of $537, 234.11 R.E.D. I, Doc. 194. The Court subsequently awarded Landmark attorneys' fees and costs in the amount of $207, 704.74. R.E.D. I, Doc. 210. The Eighth Circuit recently affirmed the judgment. R.E.D. I, Doc. 268.

         II. Alleged Facts

         The $744, 938.85 judgment against R.E.D. and Van Stavern remains unsatisfied. Doc. 1 (Complaint), ¶¶ 15-16.

         On or about August 10, 2016, while the R.E.D. I suit was pending, the three members of R.E.D., Johnson, Robbie Marley, and Elizabeth Ruble, formed Davis Hills Farms, LLC. Doc. 1, ¶ 17. Landmark alleges that they did so “for the purpose of transferring assets from R.E.D ..... ” Id., ¶ 76. Johnson, Marley, and Ruble are the sole members of both R.E.D. and Davis Hills. Id.

         On or about May 12, 2017, R.E.D. transferred two pieces of real property, referred to respectively as the “Van Stavern Building” and the “Waterman Building, ” to Davis Hills. Id., ¶ 18. The 2014 tax return for R.E.D.-purportedly the most recent tax return available-shows the Van Stavern Building as having a cost basis of $680, 808 and the Waterman Property as having a cost basis of $250, 000. Id., ¶ 21. Yet, the Warranty Deed states only that Davis Hills paid “TEN DOLLARS AND OTHER VALUABLE CONSIDERATIONS” in exchange for both pieces of property. Id., ¶ 19. Further, at a deposition in aid of execution on November 9, 2018, Marley, the corporate representative of R.E.D., testified that Davis Hills did not pay R.E.D. any consideration in exchange for the Van Stavern Building. Id., ¶ 20.

         On or about January 7, 2018, nine days before trial in the R.E.D. I suit, Davis Hills granted Mark Randolph, a cousin of the three members of R.E.D. and Davis Hills (id., ¶ 23), a Deed of Trust on the Waterman Property, allegedly to secure a debt of $400, 000. Id., ¶ 22. Landmark alleges that Randolph paid no consideration in return for the Deed of Trust. Id., ¶ 24.

         On January 14, 2019, at Plaintiff's request post-judgment, the Court issued to Davis Hills a Writ of Execution, including a set of Interrogatories to Garnishee asking Davis Hills to identify any property belonging to R.E.D. Id., ¶ 25. Just three days later, the three members of R.E.D. and Davis Hills signed a “Warranty Deed by Limited Liability Company” transferring a portion of the Waterman Property from Davis Hills to defendants Derrick and Carrie Sien, who allegedly are either relatives or business associates of the R.E.D. and Davis Hills members. Id., ¶ 26. The Warranty Deed given to the Siens states that the transfer was made “in consideration of other good and valuable consideration and Ten Dollars.” Id., ¶ 27.

         In conjunction with Davis Hills's purported transfer of a portion of the Waterman Property to the Siens, Randolph executed a “Partial Deed of Release” dated January 16, 2019, which purported to release his lien on the portion of the Waterman Property that was transferred, but did not purport to release his lien on the portion of the Waterman Property that Davis Hills did not transfer. Id., ¶ 29. Landmark alleges that Randolph received no consideration in exchange for agreeing to release the portion of his Deed of Trust covering the portion of the Waterman Property that Davis Hills transferred to the Siens. Id., ¶ 30.

         Landmark has asserted just one claim against Johnson: conspiracy to “fraudulently transfer and encumber the assets of R.E.D. with the unlawful objective of impeding Plaintiff's efforts to satisfy its judgment against R.E.D.” Doc. 1, ¶ 73.

         III. Standard on Motion to Dismiss

         Federal Rule of Civil Procedure 12(b)(6) requires the dismissal of a complaint that fails to plead facts sufficient to state a plausible claim upon which relief may be granted. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In determining whether a complaint alleges sufficient facts to state a plausible claim to relief, the Court accepts all factual allegations as true. See Great Plains Trust Co. v. Union Pac. R.R. Co., 492 F.3d 986, 995 (8th Cir. 2007). If the facts alleged in the complaint are sufficient for the court to draw a reasonable ...


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