United States District Court, W.D. Kentucky, Bowling Green Division
MEMORANDUM OPINION AND ORDER
N. STIVERS, CHIEF JUDGE
matter is before the Court on Defendant's Partial Motion
to Dismiss (DN 6). This matter is now ripe for adjudication.
For the reasons that follow, the motion is DENIED.
Statement of Facts
the relevant facts are not disputed by the parties. In 2003,
Plaintiff Dennis Babbs (“Babbs”) entered into a
contract with Equity Group Kentucky Division d/b/a Keystone
Foods (“Keystone”) whereby Babbs would accept and
raise broiler chickens for later re-delivery back to
Keystone. (Compl. ¶ 6, DN 1-3). Similarly, in 2010 the
parties entered into and executed a contract for the raising
of broilers. (Compl. ¶¶ 10-12). In 2016, the
parties entered into the present Broiler Production Agreement
(“Agreement”), again for the raising of broiler
chickens. (Compl. ¶ 13). The Agreement states, in
relevant part, that “[Keystone] will provide [Babbs]
with chicks from the hatchery.” (Def.'s Partial
Mot. Dismiss Ex. A, at 2, DN 13-1). Babbs contends that he
purchased a chicken farm and related equipment in reliance on
the Agreement. (Compl. ¶¶ 15-16).
in January 2017, the relationship between Babbs and Keystone
began to break down. Brandon Gibson (“Gibson”),
Broiler Manager of Keystone, inspected Babbs' property on
a No. of occasions, each time providing Babbs with a list of
alterations and improvements he needed to make to his
property if he wished to receive more broilers from Keystone.
(Compl. ¶¶ 17-24). Babbs contends that he
repeatedly complied with the recommendations made by Gibson
and that Gibson became increasingly more difficult to
contact. (Compl. ¶ 24). Keystone has not placed any
broilers with Babbs since approximately December 2016, and
the Agreement does not terminate until October 2019. (Compl.
March 20, 2019, Babbs filed this lawsuit in Warren Circuit
Court alleging breach of contract and breach of implied
covenant of good faith and fair dealing. (Compl. ¶¶
31-37). On May 22, 2019, Keystone filed a notice of removal
in the United States District Court for the Western District
of Kentucky. (Notice Removal, DN 1). On May 29, 2019,
Keystone filed its answer raising a variety of defenses and
moved under Fed.R.Civ.P. 12(b)(6) to dismiss Babbs' claim
for breach of implied covenant of good faith and fair
dealing. (Answer, DN 4; Def.'s Partial Mot. Dismiss, DN
6). Babbs responded (DN 12), and Keystone replied. (DN 14).
Court has subject matter jurisdiction over this action via
diversity under 28 U.S.C. § 1332. There is complete
diversity between the parties because Babbs is a resident of
Kentucky and Keystone is incorporated in Delaware with its
principal place of business in Pennsylvania. The amount in
controversy as pleaded exceeds $75, 000.00. (See Notice
Removal 3-4; Compl. ¶¶ 2-3).
STANDARD OF REVIEW
order to survive dismissal for failure to state a claim under
F. R. Civ. P. 12(b)(6), “a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). “[A] district court must (1) view the
complaint in the light most favorable to the plaintiff and
(2) take all well-pleaded factual allegations as true.”
Tackett v. M & G Polymers, USA, LLC, 561 F.3d
478, 488 (6th Cir. 2009) (citing Gunasekera v.
Irwin, 551 F.3d 461, 466 (6th Cir. 2009)). Even so, the
Court need not accept a party's “bare assertion of
legal conclusions.” Columbia Nat. Res., Inc. v.
Tatum, 58 F.3d 1101, 1109 (6th Cir. 1995) (citation
omitted). Ultimately, this inquiry is a
“context-specific task that requires the reviewing
court to draw on its judicial experience and common
sense.” Iqbal, 556 U.S. at 679.
argues that a claim for breach of the implied covenant of
good faith and fair dealing is not actionable under Kentucky
law as a tort claim except for in insurance contracts.
(Def.'s Partial Mot. Dismiss 1). Moreover, Keystone
contends that if the implied covenant claim is construed as a
contract claim, that it cannot exist apart from Babbs'
claim for breach of contract. (Def.'s Partial Mot.
Dismiss 2). In response, Babbs construes his implied covenant
claim as a contract claim, and he argues that this claim is
properly pleaded as a separate cause of action. (Pl.'s
Resp. Def.'s Partial Mot. Dismiss 1, DN ...