United States District Court, N.D. Iowa, Central Division
ORDER ON DEFENDANT'S MOTION FOR PARTIAL JUDGMENT
ON THE PLEADINGS
LEONARD T. STRAND CHIEF UNITED STATES DISTRICT JUDGE
case is before me on motion for partial judgment on the
pleadings filed by defendant AgReliant Genetics, LLC
(AgReliant). Doc. No. 15. AgReliant argues that Counts I, II
and III of plaintiff's state court petition fail as a
matter of law. Plaintiff has filed a resistance (Doc. No.
16) and AgReliant has filed a reply (Doc. No. 17) and a
supplement (Doc. No. 26).
PROCEDURAL HISTORY AND BACKGROUND FACTS
is an Indiana corporation in the business of selling
agricultural products and seeds. In 2013, AgReliant hired
plaintiff Dan Allen, an Iowa resident, to sell seeds in
Iowa. Various documents addressed the terms and
conditions of Allen's employment, including the
calculation of selling bonuses. Allen received a bonus for
his work during the 2013/2014 season, but not for the
2014/2015 season. AgReliant terminated Allen's employment
in late 2014.
filed this case in the Iowa District Court for Worth County
on November 10, 2015. He alleges that: (1) AgReliant breached
his contract by not providing certain sales-related bonuses;
(2) he detrimentally relied on promises made by AgReliant;
(3) AgReliant engaged in constructive fraud by not
compensating Allen for clients he brought to the company; and
(4) AgReliant defamed Allen. On December 31, 2015, AgReliant
removed the case to this court. Doc. No. 2.
Rule of Civil Procedure 12(c) states:
(c) Motion for Judgment on the Pleadings. After the
pleadings are closed- but early enough not to delay trial-a
party may move for judgment on the pleadings.
Civ. P. 12(c). As a general rule, motions brought under Rule
12(c) are reviewed under the same standards that apply to
motions to dismiss brought pursuant to Rule 12(b)(6), which
provides for dismissal on the basis of “failure to
state a claim upon which relief can be granted.”
Clemons v. Crawford, 585 F.3d 1119, 1124 (8th Cir.
2009), cert. denied, 561 U.S. 1026 (2010). In
determining whether a plaintiff has stated a claim sufficient
to survive a Rule 12(b)(6) motion to dismiss, the court must
accept all of the plaintiff's factual allegations as
true. Ashcroft v. Iqbal, 556 U.S. 662, 696 (2009).
“The court may consider the pleadings themselves,
materials embraced by the pleadings, exhibits attached to the
pleadings, and matters of public record.'”
Illig v. Union Electric Co., 652 F.3d 971, 976 (8th
Cir. 2011) (quoting Mills v. City of Grand Forks,
614 F.3d 495, 498 (8th Cir. 2010)); accord Mulvenon v.
Greenwood, 643 F.3d 653, 656-57 (8th Cir. 2011);
Porous Media Corp. v. Pall Corp., 186 F.3d 1077,
1079 (8th Cir. 1999).
survive a [Rule 12(b)(6)] motion to dismiss, a complaint must
contain sufficient factual matter . . . to ‘state a
claim to relief that is plausible on its face.'”
Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007)); accord B & B
Hardware, Inc. v. Hargis Indus., Inc., 569 F.3d 383, 387
(8th Cir. 2009). A claim satisfies the plausibility standard
“when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant
is liable for the misconduct alleged.” Iqbal,
556 U.S. at 678 (citing Bell Atl., 550 U.S. at 556).
“The plausibility standard is not akin to a
‘probability requirement, ' but it asks for more
than a sheer possibility that a defendant has acted
unlawfully.” Id. (quoting Bell Atl.,
550 U.S. at 556).
a plaintiff need not provide “detailed” facts in
support of his or her allegations, the “short and plain
statement” requirement of Federal Rule of Civil
Procedure 8(a)(2) “demands more than an unadorned,
Id. at 677-78 (citing Bell Atl., 550 U.S.
at 555); see also Erickson v. Pardus, 551 U.S. 89,
93 (2007) (“Specific facts are not necessary [under
Rule 8(a)(2)].”). “A pleading that offers
‘labels and conclusions' or ‘a formulaic
recitation of the elements of a cause of action will not
do.'” Iqbal, 556 U.S. at 678 (quoting Bell
Atl., 550 U.S. at 555). And, “[w]here the allegations
show on the face of the complaint [that] there is some
insuperable bar to relief, dismissal under Rule 12(b)(6) is
appropriate.” Benton v. Merrill Lynch &
Co., 524 F.3d 866, 870 (8th Cir. 2008) (citing
Parnes v. Gateway 2000, Inc., 122 F.3d 539, 546 (8th
Count I - Breach of Contract
The Iowa Supreme Court has stated, “Except when there
is ambiguity, the question of whether a written instrument
... binds the parties in contract is a question of
law.” French v. Foods, Inc., 495 N.W.2d 768,
770 (Iowa 1993) (citing Fogel v. Trustees of Iowa
College, 446 N.W.2d 451, 456 (Iowa 1989)); see
Bradshaw v. Brown Group, Inc., 258 F.3d 847, 849 (8th
Cir. 2001) (“Whether an employer's policy manual
binds the parties in contract is a question of law, unless
the document is ambiguous.” (citing Thompson v.
City of Des Moines, 564 N.W.2d 839, 844 (Iowa 1997))).
Hinshaw v. Ligon Indus., L.L.C., 551 F.Supp.2d 798,
808 (N.D. Iowa 2008). However, “the question of whether
the plaintiff has proved a breach of contract is for the
judicial fact-finder. See Davenport Bank & Trust Co.
v. State Cent. Bank, 485 N.W.2d 476, 480 (Iowa 1992)
(‘The existence and terms of a contract and whether the
contract was breached are ordinarily questions for the
jury.').” Kern v. Palmer Coll. of
Chiropractic, 757 N.W.2d 651, 658 (Iowa 2008). To
prevail on a breach of contract claim, the plaintiff must
(1) the existence of a contract, (2) the terms and conditions
of the contract, (3) that [plaintiff] has performed all the
terms and conditions required under the contract, (4) the
defendant's breach of the contract in some particular
way, and (5) that plaintiff has suffered damages as a result
of defendant's breach. Molo Oil Co. v. River City
Ford Truck Sales, Inc., 578 N.W.2d 222, 224 (Iowa 1998).
Royal Indem. Co. v. Factory Mut. Ins. Co., 786
N.W.2d 839, 846 (Iowa 2010).
parties' arguments read as two ships passing in the
night. In its brief, AgReliant argues:
Mr. Allen's breach of contract claim is improperly
premised on his misrepresentation that AgReliant and Mr.
Allen had an “oral contract” related to payment
of any bonus. These “compensation agreements, ”
as Mr. Allen characterizes them, were not oral contracts.
They were written contracts, the terms of which were
acknowledged and accepted by Mr. Allen.
It is notable that Mr. Allen did not attach a copy of the
SY2015 Bonus Plan to his Complaint because the express
language of the Plan precludes his breach of contact claim.
The SY2015 Bonus Plan requires that the “DSM [such as
Mr. Allen] must be employed by the company at the time bonus
is to be paid in order to be eligible for any bonus payment
on this 2014-2015 DSM bonus program.” (Ex. B at 8) . .
. The Bonus Payout Schedule provides that the first bonus to
be paid under the SY2015 Bonus Plan was not payable until the
2nd payroll in September 2015. (Id.). That was nine
months after Mr. Allen's employment relationship with
AgReliant had terminated. Under Iowa law, it is a fundamental
and well-settled rule that when a contract is not ambiguous,
courts must simply enforce it as written. . .
To have been eligible for any bonus under the SY2015 Bonus
Plan, Mr. Allen must have been employed by AgReliant at least
through the second payroll in September 2015 (the first day
bonuses were paid under the SY2015 DSM Bonus Plan). This was
a condition precedent to earning any bonus under the SY2015
Bonus Plan. Mr. Allen's employment relationship was
terminated on December 17, 2014 and, therefore, he failed to
meet this condition precedent. Accordingly, at the time Mr.
Allen's employment was terminated, he had earned no bonus
under the SY2015 Bonus Plan.
No. 15-1 at 5-7. In its reply, AgReliant clarifies that it
does not contest the existence of the contract, nor that
Allen plead a breach of contract, simply that ‘[t]he
material facts of Mr. Allen's breach of contract claim
are not in dispute.” Doc. No. 17 at 2.
response, Allen undertakes an extended discussion of the
pleading standards that apply in Iowa's state courts.
Doc. No. 16-1 at 4-6. However, federal law controls the
standard for considering a motion to dismiss. See, e.g.,
Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins.
Co., 559 U.S. 393, 417 (2010) (“[i]t is a
long-recognized principle that federal courts sitting in
diversity ‘apply state substantive law and federal
procedural law.' Hanna v. Plumer, 380 U.S. 460,
465, 85 S.Ct. 1136, 14 L.Ed.2d 8 (1965).”) (Stevens, J.
concurring). The Eighth Circuit has stated:
We apply federal pleading standards-Rules 8 and 12(b)(6)-to
the state substantive law to determine if a complaint makes
out a claim under state law. See Council Tower Ass'n
v. Axis Specialty Ins. Co., 630 F.3d 725, 730 (8th Cir.
2011); see also Shady Grove Orthopedic Assoc., v.
Allstate Ins. Co., 559 U.S. 393, 130 S.Ct. 1431, 1442,
176 L.Ed.2d 311 (2010).
Karnatcheva v. JPMorgan Chase Bank, N.A., 704 F.3d
545, 548 (8th Cir. 2013). Accordingly, much of Allen's