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DANA TRANSPORT, INC. v. ABLECO FINANCE

August 17, 2005.

DANA TRANSPORT, INC., DANA CONTAINER, INC., INTERNATIONAL EQUIPMENT LOGISTICS, INC., and SUTTLES TRUCK LEASING, LLC, Plaintiffs,
v.
ABLECO FINANCE, LLC, Defendant.



The opinion of the court was delivered by: KATHARINE HAYDEN, District Judge

[EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.] OPINION

Plaintiffs Dana Transport, Inc., Dana Container, Inc., International Equipment Logistics, Inc. and Suttles Truck Leasing, LLC (collectively "plaintiffs") filed suit against Ableco Finance, LLC ("defendant") seeking compensatory and punitive damages for alleged breach of contract, breach of the implied covenant of good faith and fair dealing, and tortious interference with economic opportunities. Before the Court is defendant's motion to dismiss the complaint under Rule 12(b)(6) for failure to state a claim upon which relief may be granted. For the reasons that follow, defendant's motion is granted in part and denied in part.

I. BACKGROUND

  All the facts are taken from the complaint and they will be deemed true for purposes of this Rule 12(b)(6) motion.

  Plaintiffs' claims stem from a commercial loan involving a multi-million dollar financing transaction. Plaintiffs are general commodity and contract carriers, specializing in the transportation of bulk liquid materials. (Amended Compl. ¶ 1.) Defendant provides large asset-based loans. (Id. ¶ 2.) In March 2003, the parties began negotiations and defendant was made aware of plaintiffs' organization structure, including the fact that plaintiffs did not have a chief financial officer or a sophisticated financial reporting systems. (Id. ¶¶ 6, 7.)

  In May 2003, plaintiffs accepted a proposal from defendant for $60,000,000 in financing (the "Proposal"). (Id. ¶ 7.) Plaintiffs gave defendant $125,000 as a deposit from which defendant could pay for various costs associated with due diligence. (Id. ¶ 9; Exh. 1.) The Proposal provided that defendant would undertake good faith efforts to determine whether certain funding conditions had been reasonably satisfied. If they were, defendant would fund the loan in exchange for additional consideration to be furnished by plaintiffs. (Id. ¶ 8; Exh. 1.) The Proposal would expire if the financing proposal was not consummated within 90 days of the execution of the Proposal. (Id.)

  In June 2003, "the parties determined that the first part of the financing package to close would be for $15,000,000 for a one-year loan," with closing scheduled at the end of July 2003. (Id. ¶ 11; Exh. 2.) Plaintiffs assert that "[t]he change in scope of the initial financing had the effect of modifying certain aspects of the parties' earlier agreement insofar as it pertained to the first $15,000,000 to be funded," but "did not give defendant any reason to avoid its obligations to plaintiffs." (Pl. Oppos. Br. at 1.)

  Thereafter, in addition to performing due diligence for the May Proposal, the parties engaged in substantial efforts to close the $15,000,000 loan and plaintiffs gave defendant UCC-1 liens. (Id. ¶ 12; Exh. 2; Exh. 3.) Closing documents were prepared, including a financing statement setting forth that plaintiffs would be required to comply with certain management and financial reporting requirements after the closing of the $15,000,000 loan. (Id. ¶¶ 12, 13, 16, 18) (emphasis in complaint).

  According to plaintiffs, they sufficiently satisfied the various conditions for funding so that before the end of July 2003, or shortly thereafter, defendant was required to fund the initial $15,000,000. (Id. ¶ 14.)

  The complaint alleges that even though the conditions for funding had been reasonably satisfied, and defendant knew of the importance to plaintiffs of closing the $15,000,000 loan on or about July 31, 2003, and defendant was obligated to act in good faith, on or about July 29, 2003, defendant abruptly advised plaintiffs that it would not fund the loan. (Id. ¶ 15.) Defendant justified its action because plaintiffs did not have, in place, pre-closing, a chief financial officer and certain reporting systems. (Id. ¶ 16.) According to plaintiffs, defendant could not have believed these reasons to be valid because defendant knew of plaintiffs' financial management system at the time the parties entered into the agreement and never demanded that plaintiffs' system be changed prior to closing. (Id. ¶ 16.)

  On May 10, 2004, plaintiffs filed a complaint against defendant in New Jersey Superior Court seeking compensatory and punitive damages. On June 14, 2004, defendant removed the case to federal court based on diversity jurisdiction.

  II. STANDARD OF REVIEW

  A Rule 12(b)(6) motion may be granted "only if accepting all well-pleaded allegations in the complaint as true, and viewing them in the light most favorable to plaintiff, plaintiff is not entitled to relief." Doug Grant, Inc. v. Greate Bay Casino Corp., 232 F.3d 173, 183 (3d Cir. 2000) (citing Maio v. Aetna, Inc., 221 F.3d 472, 481 (3d Cir. 2000)). A court is required to accept as true all factual allegations in the complaint but need not accept "unsupported conclusions and unwarranted inferences." City of Pittsburgh v. West Penn Power Co., 147 F.3d 256, 263 n. 13 (3d Cir. 1998) (citing Schuylkill Energy Res., Inc. v. Pennsylvania Power & Light Co., 113 F.3d 405, 417 (3d Cir. 1997)). Accordingly, grounds for dismissal are ...


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