United States District Court, D. New Jersey
Castronovo, Esquire, Castronovo & McKinney, LLC Attorney
for Plaintiff Brownstone Specialty Finance.
Matthew A. Green, Esquire Mathieu J. Shapiro, Esquire
Samantha J. Koopman, Esquire Obermayer Rebmann Maxwell &
Hippel LLP, Attorneys for Defendant Freedom Mortgage
L. HILLMAN, U.S.D.J.
matter comes before the Court by way of Defendant Freedom
Mortgage Corporation's motion [Doc. No. 8] seeking to
dismiss Count I of Plaintiff's amended complaint [Doc.
No. 5] pursuant to Federal Rule of Civil Procedure 12(b)(6)
for failure to state a claim upon which relief can be
granted. The Court has considered the parties'
submissions and decides this matter pursuant to Federal Rule
of Civil Procedure 78.
reasons expressed below, Defendant's motion will be
action, Plaintiff asserts claims for allegedly unpaid
commissions in violation of the New Jersey Sales
Representatives' Rights Act (Count I), N.J. Stat. Ann.
§§ 2A:61A-1, et seq., and breach of
contract (Count II). The Court exercises jurisdiction over
Plaintiff's state law claims pursuant to 28 U.S.C. §
1332 based on diversity of citizenship and an amount in
controversy in excess of $75, 000.
Brownstone Specialty Finance, Inc. (hereinafter,
"Brownstone" or "Plaintiff") is
incorporated in the State of Texas and maintains its
principal place of business in Texas. (Pl.'s Am. Compl.
[Doc. No. 5], ¶ 1.) Accordingly, Plaintiff is a citizen
of the State of Texas. Defendant Freedom Mortgage Corporation
(hereinafter, "Freedom" or "Defendant")
is incorporated in the State of New Jersey and maintains its
principal place of business in New Jersey. (Id.
¶ 2.) Thus, Defendant is a citizen of the State of New
Jersey. Therefore, complete diversity of citizenship exists
between the parties.
amount in controversy is met because the allegations
contained in Plaintiff's amended complaint sufficiently
demonstrate that the damages sought are in excess of $75,
000, exclusive of interest and costs. Specifically,
Brownstone claims damages of approximately $44, 667 for
allegedly unpaid commissions under the Sales
Representatives' Rights Act ("SRRA"), which
permits exemplary damages in an amount three times greater
than the amount of unpaid commissions and allows for the
recovery of all attorney's fees actually and reasonably
incurred in bringing such an action. See N.J. Stat.
Ann. § 2A:61A-3(a). Plaintiff's initial claim for
damages, when multiplied by three, and considered with a
potential award for attorney's fees, clearly satisfies
the amount in controversy requirement.
amended complaint, Brownstone alleges that in August of 2014
Brownstone began "working for Defendant as a
'Consultant' providing 'commercial loan
origination referral services' pursuant to a Services
Agreement" between the parties. (Pl.'s Am. Comp. ¶
5.) Almost two years later, on July 1, 2016, Freedom verbally
terminated the parties' Services Agreement. (Id.
¶ 7.) Freedom followed up by letter dated July 5, 2016,
and provided Brownstone with a written notice of termination
pursuant to the terms of the Services Agreement, which
permitted either party to terminate the Agreement "at
any time for any reason by giving the other party thirty (30)
days prior written notice." (Id. ¶ 11;
see also Ex. A [Doc. No. 8-1] to Def.'s Mem. of
Law, Services Agreement, , ¶ 6.1.) Brownstone received the
written notice of termination on July 7, 2016. (Id.)
Relying upon Exhibit A to the Services Agreement, a document
entitled "Fee Schedule", Brownstone alleges that
after the termination Freedom was still obligated to pay
Brownstone a Monthly Draw3 in the amount of $20, 000 for each
of the months of June and July, and a pro-rata portion of the
August Monthly Draw based on the effective date of the
termination. (Id. ¶¶ 6-7, 9-12, 15,
18-20.) Brownstone now claims that Freedom's failure to
pay the Monthly Draw constitutes a violation of the SRRA
because the Monthly Draw qualifies as a
"commission" as defined by the Act. (Pl.'s Am.
Compl. ¶¶ 22-29.)
seeks to dismiss Count I of Plaintiff's amended complaint
asserting a claim under the SRRA pursuant to Federal Rule of
Civil Procedure 12(b)(6). When considering a motion to
dismiss a complaint for failure to state a claim upon which
relief can be granted pursuant to Federal Rule of Civil
Procedure 12(b)(6), a court must accept all well-pleaded
allegations in the complaint as true and view them in the
light most favorable to the plaintiff. Evancho v.
Fisher, 423 F.3d 347, 350 (3d Cir. 2005). It is well
settled that a pleading is sufficient if it contains "a
short and plain statement of the claim showing that the
pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2).
district court, in weighing a motion to dismiss, asks
"'not whether a plaintiff will ultimately prevail
but whether the claimant is entitled to offer evidence to
support the claims[.]'" Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 563 n.8 (2007) (quoting
Scheuer v. Rhoades, 416 U.S. 232, 236 (1974));
see also Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct.
1937, 1953 (2009) ("Our decision in Twombly
expounded the pleading standard for 'all civil
actions[.]'") (citation omitted). The Third Circuit
has instructed district ...