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Helm v. Ratterman

United States District Court, W.D. Kentucky, Louisville

October 17, 2017

C. WILLIAM HELM PLAINTIFF
v.
ALLISON RATTERMAN, ET AL. DEFENDANTS

          MEMORANDUM OPINION

          THOMAS B. RUSSELL, SENIOR JUDGE UNITED STATES DISTRICT COURT.

         This matter is before the Court on Defendants Dr. Allison Ratterman, Angela Koshewa, Dr. Pamela Feldhoff, and Dr. Eleanor Lederer's (the Defendants) Motion to Dismiss Plaintiff Dr. C. William Helm's Amended Complaint pursuant to Rule 12(b)(6). [R. 20.] Helm responded, [R. 21], and the Defendants replied, [R. 27]. Fully briefed, this matter is ripe for adjudication. For the reasons stated herein, the Defendants' Motion to Dismiss, [R.20], is GRANTED.

         BACKGROUND

         Helm's case against the Defendants continues in this matter involving the Defendants' Motion to Dismiss Helm's Amended Complaint. Previously, upon the Defendants' Motion to Dismiss, [R. 7], this Court denied Helm's § 1983 claims as untimely but allowed Helm an opportunity to amend his fraud claim to comply with the heightened pleading standard of Rule 9(b). [R. 18 at 15-16 (Opinion on Previous Motion to Dismiss).] Specifically, this Court stated that Helm failed to allege two necessary elements of fraud by omission (also known as fraudulent concealment): (1) the Defendants had a duty to disclose material facts and (2) the Defendants' failure to do so induced Helm to act. [R. 18 at 18-19.] Furthermore, the Court held that Helm could be entitled to equitable tolling on his interference and breach of fiduciary duty claims if he could successfully state a claim for fraud. [R. 18 at 2-3.] Further detail on the facts surrounding the investigation into the alleged research misconduct by Helm can be found in this Court's Memorandum Opinion and Order granting in part and denying in part the Defendants' Motion to Dismiss. [R. 18.]

         On July 19, 2017, Helm filed his Amended Complaint in which he alleges four different claims against the Defendants: fraud by omission, tortious interference with a contract, interference with a prospective business advantage, and breach of fiduciary duty. [See R. 19 (Amended Complaint).] Presumably in an effort to comply with the heightened requirements of Rule 9(b), Helm articulates sixteen instances of fraudulent concealment. [See R. 19 at 9-44.] He also asserts that his interference claims and his claim for breach of fiduciary duty invoke equitable tolling. [R. 19 at ¶¶ 225, 230, 235.]

         Once again, the Defendants now move to dismiss Helm's complaint. [R. 20 (Motion to Dismiss Amended Complaint).] They argue that Helm failed to state a claim for fraud by omission because he cannot show a duty to disclose, he cannot establish that he was induced to act, and he failed to plead his fraud claim with particularity. [See R. 20.] Additionally, the Defendants argue that Helm's remaining state law claims are barred by the statute of limitations, and, furthermore, Helm's interference claims fail as a matter of law even if they are not barred. [Id.]

         STANDARD

         A complaint must 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 survive a motion to dismiss under Rule 12(b)(6), a party must “plead enough ‘factual matter' to raise a ‘plausible' inference of wrongdoing.” 16630 Southfield Ltd. P'ship v. Flagstar Bank, F.S.B., 727 F.3d 502, 504 (6th Cir. 2013) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). A claim becomes plausible “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. Corp. v. Twombly, 550 U.S. 544, 556 (2007)). When considering a Rule 12(b)(6) motion to dismiss, the court must presume all of the factual allegations in the complaint are true and draw all reasonable inferences in favor of the non-moving party. Total Benefits Planning Agency, Inc. v. Anthem Blue Cross & Blue Shield, 552 F.3d 430, 434 (6th Cir. 2008) (citing Great Lakes Steel v. Deggendorf, 716 F.2d 1101, 1105 (6th Cir. 1983)). “The court need not, however, accept unwarranted factual inferences.” Id. (citing Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987)). Should the well-pleaded facts support no “more than the mere possibility of misconduct, ” then dismissal is warranted. Iqbal, 556 U.S at 679. The Court may grant a motion to dismiss “only if, after drawing all reasonable inferences from the allegations in the complaint in favor of the plaintiff, the complaint still fails to allege a plausible theory of relief.” Garceau v. City of Flint, 572 F. App'x. 369, 371 (6th Cir. 2014) (citing Iqbal, 556 U.S. at 677-79).

         To plead a claim sounding in fraud, including fraud by omission, requires a bit more. Civil Rule 9(b) imposes a heightened pleading standard: A complaint must state the facts constituting the fraud with particularity. Fed.R.Civ.P. 9(b); see Chesbrough v. VPA, P.C., 655 F.3d 461, 467 (6th Cir. 2011). Accordingly, the plaintiff “must generally (1) specify the time, place, and content of the alleged misrepresentation; (2) identify the fraudulent scheme and the fraudulent intent of the defendant; and (3) describe the injury resulting from the fraud.” SFS Check, LLC v. First Bank of Del., 774 F.3d 351, 358 (6th Cir. 2014) (citing United States ex rel. SNAPP, Inc. v. Ford Motor Co., 532 F.3d 496, 504 (6th Cir. 2008)). The purposes animating Civil Rule 9(b) are “(1) to alert defendants to the particulars of the allegations against them so they can intelligently respond; (2) to prevent ‘fishing expeditions'; (3) to protect defendants' reputations against fraud allegations; and (4) to whittle down potentially wide-ranging discovery to only relevant matters.” Id. (citing Chesbrough, 655 F.3d at 466-67).

         DISCUSSION

         In the instant motion, the Defendants argue that Helm's Amended Complaint must be dismissed for three reasons. First, the Defendants argue that Helm failed to satisfy Rule 9(b)'s heightened pleading standard for fraud on several of the underlying factors of Helm's claim of fraud by omission. [R. 20 at 8.] Second, the Defendants argue that Helm's remaining state law claims are barred by the statute of limitations. [Id. at 14.] Third, the Defendants argue that in addition to being barred by the statute of limitations, Helm's interference claims fail as a matter of law. [Id. at 17.] The Court will address each of these arguments in turn as needed.

         I. Claim for Fraud by Omission

         Helm asserts that Defendants committed fraud by omission when they failed to make numerous disclosures involving the investigation into his alleged research misconduct. [R.21 at 2-27.] Helm alleges that these disclosures were required under the ORI policy. [Id.] To succeed on a fraud by omission claim, the plaintiff must prove that “(1) the defendant had a duty to disclose the material fact at issue; (2) the defendant failed to disclose the fact; (3) the defendant's failure to disclose the material fact induced the plaintiff to act; and (4) the plaintiff suffered actual damages as a consequence.” Giddings & Lewis, Inc. v. Indus. Risk Insurers, 348 S.W.3d 729, 747 (Ky. 2011) (citing Rivermont Inn, Inc. v. Bass Hotels Resorts, Inc., 113 S.W.3d 636, 641 (Ky. Ct. App. 2003)). As previously discussed, the heightened pleading standard of Rule 9(b) applies to this claim. See Fed. R. Civ. P. 9(b).

         A. Dut ...


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