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North Presidio, LLC v. Lowe's Home Centers, LLC

United States District Court, N.D. Texas, Fort Worth Division

July 29, 2019

NORTH PRESIDIO, LLC, Plaintiff,
v.
LOWE'S HOME CENTERS, LLC, Defendant.

          MEMORANDUM OPINION AND ORDER

          JOHN McBRYDE UNITED STATES DISTRICT JUDGE.

         Came on for consideration the motion of defendant, Lowe's Home Centers, LLC, to dismiss. The court, having considered the motion, the response of plaintiff, North Presidio, LLC, the reply, and the applicable authorities, finds that the motion should be granted.

         I.

         Background

         Plaintiff initiated this action by the filing of its original petition in the 153rd Judicial District Court of Tarrant County, Texas. Doc.[1] 1 at Ex. A-2. Defendant removed this action to this court by notice of removal filed March 18, 2019. Doc. 1, On April 18, 2019, the court ordered the parties to replead and drew plaintiff's attention specifically to the pleading requirements of Rules 8(a} and 9(b) of the Federal Rules of Civil Procedure. Doc. 11 at 2 n.2. Plaintiff then filed an amended complaint on May 6, 2019, doc. 14, in which it alleged:

         Plaintiff owns property and intends to develop it into a large mixed-use development. See id. at 2, ¶ 4. Plaintiff initially bought the property, in large part, due to information from defendant's broker that it was interested in being an anchor tenant. Id. at ¶ 6. Plaintiff negotiated to lease part of the property (the "Lowe's Tract") to defendant on which a Lowe's store would be developed. Id. Much of plaintiff's planning and design of the development was centered around the contemplated store. Id. at 3, ¶ 6. As a result of the negotiations, plaintiff and defendant entered into an Agreement to Enter into Ground Lease dated June 23, 2017 (the "Agreement"). Id. at ¶ 8. Pursuant to the Agreement, defendant agreed to enter into a ground lease (the "Lease") for the Lowe's Tract upon certain conditions being met, including plaintiff's securing of certain governmental approvals, satisfactory inspections, and delivery of acceptable title and survey. Id. at ¶ 9. All of those conditions were met. Id. at 7, ¶ 18. The Agreement also contemplated that the parties would enter into an Easements, Covenants, Conditions and Restrictions ("ECCR") agreement and a Site Development Agreement ("SDA"), pursuant to which plaintiff would perform site work on the Lowe's Tract. Id. at 3-4, ¶ 9. The Agreement also provides that plaintiff agreed to comply with defendant's development criteria for any work done prior to closing and the SDA's execution, and defendant gave those criteria to plaintiff. Id. at 4, ¶ 10. In addition, the Agreement states that the SDA would require defendant to reimburse plaintiff for its share of the project costs up to $4, 320, 000. Id.[2]

         Plaintiff spent considerable funds and resources to ensure that the property was developed according to defendant's development criteria. Id. at ¶ 11. The parties communicated weekly about the site development work, and during those communications, plaintiff regularly asked defendant' to confirm that the work was being done according to its requirements. Id. at 5, ¶ 12. During a number of those conversations, defendant affirmed that it assented to the terms of the SDA, drafts of which were being exchanged. Id. Based upon defendant's frequently-stated intention to consummate the Agreement and enter into the Lease, ECCR, and SDA, plaintiff spent substantial funds and resources to develop the property in a way that would accommodate the contemplated work on the Lowe's Tract and entered into leases with other tenants, including two that were conditioned upon defendant becoming a tenant in the development. Id. at 5-6, ¶ 12.

         On August 3, 2018, plaintiff sent defendant final versions of the Lease, ECCR, and SDA for execution. Id. at 6, ¶13. In an email dated August 2018 and sent September 6, 2018, defendant told plaintiff that it did not intend to move forward with the closing of the Lease. See id. at 6, ¶ 14.[3] The email referenced a conversation the previous day between "Mr. Stoner" and "Mr. De la Vega," plaintiff's principal, in which "Mr. Stoner" told "Mr. De la Vega" that defendant was not moving forward due to "change in leadership." Id. Defendant ignored plaintiff's request for reimbursement for certain site work and refused to agree to the release of defendant's $50, 000 earnest money deposit.[4] Id. at 6, ¶ 15.

         Plaintiff brought four causes of action against defendant, which the court is simplifying as follows:

         Count One is a breach of contract claim based on plaintiff's allegation that defendant breached the Agreement by refusing to enter into the Lease, ECCR, and SDA. Id. at 7, ¶ 20. Plaintiff alleged that it incurred over $6 million in damages from defendant's breach. Id. Plaintiff brought the following three claims in the alternative in case the court did not find the SDA to be binding.

         Count Two is a quantum meruit claim based on plaintiff's allegation that it performed site work for defendant, and defendant accepted, used, and enjoyed the site work and was ■ reasonably notified that plaintiff expected compensation for it. Id. at 8-9, ¶ 26.

         Count Three is a promissory estoppel claim based on plaintiff's allegation that it detrimentally relied on defendant's promise to reimburse it for the site work. Id. at 9, ¶ 29.

         Count Four is a fraud by non-disclosure claim based on plaintiff's allegation that defendant failed to disclose that it would not proceed with opening the planned Lowe's store, despite having a duty to do so, to induce plaintiff to perform the site work. Id. at 10 ¶ 33.

         II.

         Grounds of the Motion

         Defendant moved to dismiss plaintiff's breach of contract claim for failure to state a claim upon which relief can be granted to the extent plaintiff seeks damages in excess of $50, 000 plus accrued interest.[5] Defendant also moved to dismiss plaintiff's quantum meruit, promissory estoppel, and fraud claims for failure to state a claim upon which relief can be granted.

         III.

         Analysis

         A. Pleading Standards

         Rule 8(a)(2) of the Federal Rules of Civil Procedure provides, in a general way, the applicable standard of pleading. It requires that a complaint contain "a short and plain statement of the claim showing that the pleader is entitled to relief," Fed.R.Civ.P. 8(a)(2), "in order to give the defendant fair notice of what the claim is and the grounds upon which it rests," Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotation marks and ellipsis omitted). Although a complaint need not contain detailed factual allegations, the "showing" contemplated by Rule 8 requires the plaintiff to do more than simply allege legal conclusions or recite the elements of a cause of action. Id. at 555 & n.3. Thus, while a court must accept all of the factual allegations in the complaint as true, it need not credit bare legal conclusions that are unsupported by any ...


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