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Kudlicki v. MDMA

May 10, 2006

LOIS ANN KUDLICKI, PLAINTIFF,
v.
MDMA, INC., D/B/A EVANSTON TOYOTA, DEFENDANT. MDMA, INC., D/B/A EVANSTON TOYOTA, THIRD-PARTY PLAINTIFF,
v.
PRIME MARKET TARGETING, INC., A/K/A PMT ADVERTISING, AND GREG SUAZA, D/B/A AVALON MARKETING, THIRD-PARTY DEFENDANT.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge

MEMORANDUM OPINION AND ORDER

Before the Court is Third-Party Defendant Prime Market Targeting, Inc., a/k/a PMT Advertising's ("PMT") Motion to Dismiss Counts I, IV, V, and VI of MDMA, Inc., d/b/a Evanston Toyota's ("MDMA") First Amended Third-Party Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons discussed below, the Court grants in part and denies in part PMT's motion.

LEGAL STANDARD

The purpose of a motion to dismiss pursuant to Rule 12(b)(6) is to test the legal sufficiency of a complaint, not the factual sufficiency. Szabo v. Bridgeport Mach., Inc., 249 F.3d 672, 675-76 (7th Cir. 2001); see also Cler v. Illinois Educ. Ass'n, 423 F.3d 726, 729 (7th Cir. 2005) (motion to dismiss challenges complaint's sufficiency). The Court will only grant a motion to dismiss if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Centers v. Mortgage, Inc., 398 F.3d 930, 933 (7th Cir. 2005) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957)). The Court must assume the truth of the facts alleged in the pleadings, construe the allegations liberally, and view them in the light most favorable to the plaintiff. Centers, 398 F.3d at 333.

BACKGROUND

In the underlying putative class action Complaint, Plaintiff Lois Ann Kudlicki alleges that MDMA violated the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. §1681 et seq. by sending her a "pre-approved loan" mailer after obtaining her consumer report without permission or a permissible purpose as required under the FCRA. See Cole v. U.S. Capital Inc., 389 F.3d 719, 725 (7th Cir. 2004). In turn, MDMA brought the present First Amended Third-Party Complaint seeking indemnification and contribution from PMT for damages that may be awarded to Kudlicki if MDMA is found to have wilfully violated the FCRA. MDMA also alleges a common law claim of breach of contract against PMT.

ANALYSIS

I. Breach of Contract Against PMT -- Count I

To prevail on a breach of contract claim under Illinois law, a plaintiff must establish: (1) the existence of a valid and enforceable contract, (2) performance under the terms of the contract, (3) that defendant breached the contract, and (4) that plaintiff suffered an injury as a result of defendant's breach. Burrell v. City of Mattoon, 378 F.3d 642, 651 (7th Cir. 2004); Zirp-Burnham, LLC v. E. Terrell Assoc., Inc., 356 Ill.App.3d 590, 600, 292 Ill.Dec. 289, 826 N.E.2d 430 (Ill.App.Ct. 2005).

In the First Amended Third-Party Complaint, MDMA alleges that it and PMT entered into a valid and enforceable oral contract*fn1 under which PMT agreed to perform certain services in connection with preparing, addressing, and mailing the advertising flyer that is the subject of the Kudlicki lawsuit. (R. 55-1, First Am. Third-Party Compl. ¶ 28.) MDMA further alleges that it fully performed its duties under the contract by promptly paying PMT for its services. (Id. ¶ 29.) Also, MDMA alleges that if it is determined that there was a willful violation of the FCRA, PMT's actions would constitute a breach of its contract with MDMA. (Id. ¶ 38.) Last, MDMA states that if it is assessed damages as a result of the willful violation, such damages are a result of PMT's breach. (Id. ¶ 39.)

Based on these allegations, MDMA has properly plead a breach of contract claim. See Fed.R.Civ.P. 8(a)(2) (complaint need only state "short and plain statement of the claim showing that the pleader is entitled to relief" ). PMT, however, contends that any damages that MDMA seeks under its breach of contract theory are actually claims for indemnity or contribution. PMT's argument in support of this contention is not only buried in a footnote, but is also undeveloped and based on an Eastern District of California case that is not persuasive. Without a more developed argument, the Court will not dismiss MDMA's breach of contract claim for failure to state a claim upon which relief can be granted. See Doherty v. City of Chicago, 75 F.3d 318, 324 (7th Cir. 1996) ("Given our adversary system of litigation, it is not the role of this court to research and construct the legal arguments open to parties, especially when they are represented by counsel.") (citation omitted). Therefore, the Court denies PMT's Motion to Dismiss Count I of the First Amended Third-Party Complaint.

II. Indemnification and Contribution Claims Against PMT -- Counts IV & V

A. Contribution

Next, PMT contends that federal law prohibits MDMA from seeking contribution from PMT. See Donovan v. Robbins, 752 F.2d 1170, 1179 (7th Cir. 1985) ("Where contribution is sought by one who has had to pay damages for violating a federal statute, the scope and limitations of the right of contribution are invariably treated as questions of federal rather than state law."). PMT bases its argument on Texas Indus., Inc. v. Radcliff Materials, Inc., 451 U.S. 630, 101 S.Ct. 2061, 68 L.Ed.2d 500 (1981), which involved the Sherman and Clayton Antitrust Acts. In short, Texas Industries manufactured and sold ready-mix concrete, and one of its customers filed an antitrust action against it alleging that Texas Industries and other unnamed concrete manufacturers had conspired to raise concrete prices. Id. at ...


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