Neubauer v. FedEx, No. 15-3694 (8th Cir. 2017)
Annotate this CasePlaintiff and his corporate entity, Marken, Inc., filed suit alleging that FedEx breached contractual duties, engaged in fraud, and violated North Dakota's Franchise Investment Law, N.D.C.C. 51-19-02(5)(a), and Racketeer Influenced and Corrupt Organizations (RICO) Act, N.D.C.C. 12.1-06.1-05. The district court dismissed the amended complaint. Determining that Pennsylvania law governs the construction of the Standard Operating Agreement (SOA) at issue, the court concluded that dismissal as to the first breach-of-contract claim was proper because the SOA had expired and the Independent Service Provider (ISP) Agreement governed the relationship between the parties. Furthermore, the plain text of the SOA foreclosed the claim. The court also concluded that plaintiff's second breach-of-contract claim was properly dismissed and rejected plaintiff's reading of the Background Statement of the SOA because plaintiff's reading ignores context and would lead to an absurd result. The court also concluded that plaintiff's fraud claims were properly dismissed because he failed to plead fraud with the specificity required by Rule 9(b); the district court properly dismissed the Franchise Investment Law claim because the amended complaint failed to plausibly allege that plaintiff was granted the right to offer or distribute services to customers; and plaintiff's state RICO claim was also properly dismissed because he failed to sufficiently plead facts for his fraud claims and Franchise Investment Law claim. Accordingly, the court affirmed the judgment.
Court Description: Gruender, Author, with Colloton and Beam, Circuit Judges] Civil case - Contracts. Plaintiff's claim that defendant breached its prior operating agreement with him was properly dismissed as the agreement had expired and no longer controlled their relationship and, in any event, the specific language of the prior agreement foreclosed the claim; plaintiff's second breach-of-contract claim was foreclosed by the language of the agreement; plaintiff's fraud claims were properly dismissed because he failed to plead fraud with the specificity required by Rule 9(b); the parties' relationship was not covered by North Dakota's Franchise Investment Law as the parties' agreement explicitly stated plaintiff was an independent contractor providing transportation services for delivery of defendant's packages and he had not been granted the right to offer or distribute services to customers; the complaint failed to alleged a claim under North Dakota's RICO act.
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