Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Jackson v. N'Genuity Enterprises

November 8, 2010

VINCENT E. JACKSON, PLAINTIFF,
v.
N'GENUITY ENTERPRISES, CO.; VALERIE LITTLECHIEF; ALFRED BOWEN; AND DUSTIN THOMAS BOWEN DEFENDANTS.



The opinion of the court was delivered by: Judge Joan H. Lefkow

OPINION AND ORDER

Vincent "Bo" Jackson filed a twelve-count complaint against N'Genuity Enterprises, Co. ("N'Genuity" or the "company") and certain directors and employees of N'Genuity, arising from alleged mismanagement of the company.*fn1 N'Genuity has filed counterclaims against Jackson, who was a director and officer of N'Genuity until November 2009, alleging violations of the general standards of conduct for directors and officers set forth by Arizona statute (Counts I and II) and common law breach of fiduciary duty (Count III). Jackson seeks dismissal of N'Genuity's counterclaims pursuant to Federal Rule of Civil Procedure 12(b)(6). For the following reasons, Jackson's motion [76] is granted in part and denied in part.

BACKGROUND

The following facts are taken from N'Genuity's amended counterclaim and are presumed true for the purpose of resolving the pending motion.

N'Genuity is an Arizona corporation that sells wholesale food products and was incorporated in 2001 by Jackson and Valerie LittleChief. At that time, Jackson was given 49% of the company's shares in exchange for allowing N'Genuity to use his name, signature, likeness, and reputation as a star athlete to promote its products. Jackson also allowed N'Genuity to use his name and signature for trademark "Bo Burgers" and "Bo Jackson Signature Foods." In addition, Jackson was a director of N'Genuity and served as the company's secretary. Jackson's responsibilities as an officer and director of N'Genuity included attending conferences, trade shows, and other meetings to promote N'Genuity's food products.

Sometime in 2006 or 2007, N'Genuity learned that Jackson was having an extramarital affair with the wife of a senior executive for Sysco Foodservices ("Sysco"), one of N'Genuity's largest customers and a purchaser of "Bo Jackson Signature Foods" and "Bo Burgers." N'Genuity learned about the affair because Jackson made statements regarding the affair to numerous people. As a result, N'Genuity's relationship with Sysco was damaged and N'Genuity lost nearly all of its business with Sysco.

Sometime in 2008, Jackson allowed Chick-fil-A, a chain of fast food restaurants that primarily serves chicken, to use his name and likeness in a commercial. Jackson did not seek N'Genuity's approval prior to allowing his name and likeness to appear on the commercial. The Chick-fil-A commercial features a cow that wears a paper mask that is a photograph of Jackson's face.*fn2 The cow is standing on the side of a football field, mooing. Subtitles on the screen "translate" the cow's mooing into English. The subtitles state, in part: "Hi. Multisport Legend Bo Jackson here. When I wasn't hitting linebackers or baseballs I would run over and eat chicken. Never took up burgers. You will never be a multisport legend unless you hit the chicken." The commercial was consistent with Chick-fil-A's other advertisements, which promote the alleged benefit of eating chicken instead of beef. After the Chick-fil-A commercial was released, N'Genuity's sales of "Bo Burgers" and "Bo Jackson Signature Foods" decreased from $1 million to $100,000. The decrease in sales was caused by the diminution of Jackson's effectiveness as a promoter of N'Genuity's products.

In September, November, and December of 2008, N'Genuity attempted to contact Jackson numerous times, either directly or through his attorney, because N'Genuity's other directors and officers were concerned about the Sysco account and Chick-fil-A commercial.*fn3

Jackson did not respond to N'Genuity's requests to discuss these issues. N'Genuity scheduled a shareholders and directors meeting for December 2, 2008, which Jackson declined to attend at the last minute. N'Genuity's attorney emailed Jackson's attorney on January 9, 2009 and stated the company intention "to reach some understanding before N'Genuity pursues unilateral action to resolve the matter." Jackson did not respond. On January 27, 2009, N'Genuity held a Special Meeting of the Board of Directors to discuss the Chick-fil-A commercials and necessary follow-up. Jackson received notice of the meeting but did not attend the meeting. Jackson was removed as a shareholder and director of N'Genuity in November 2009.

LEGAL STANDARD

A motion to dismiss under Rule 12(b)(6) challenges a complaint for failure to state a claim upon which relief may be granted. See Fed. R. Civ. P. 12(b)(6); Gen. Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1080 (7th Cir. 1997). In ruling on a 12(b)(6) motion, the court accepts as true all well-pleaded facts in the plaintiff's complaint and draws all reasonable inferences from those facts in the plaintiff's favor. Dixon v. Page, 291 F.3d 485, 486 (7th Cir. 2002). In order to survive a Rule 12(b)(6) motion, the complaint must not only provide the defendant with fair notice of the claim's basis, but must also establish that the requested relief is plausible on its face. Ashcroft v. Iqbal, --- U.S. ---, 129 S.Ct. 1937, 1949, 173 L.Ed. 2d 868 (2009); see also Bell Atl. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed. 2d 929 (2007). At the same time, the plaintiff need not plead legal theories. Hatmaker v. Mem'l Med. Ctr., 619 F.3d 741, 743 (7th Cir. 2010). Rather, it is the facts that count.

ANALYSIS

I. Pleading Standard

Jackson argues that N'Genuity's claim for breach of fiduciary duty must be pleaded with particularity under Federal Rule of Civil Procedure 9(b) because breach of fiduciary duty creates a presumption of constructive fraud under Illinois and Arizona law. The cases cited by Jackson provide no support for this assertion, however. See Taylor v. Feinberg, No. 08-CV-5588, 2009 WL 3156747 (N.D. Ill. Sept. 28, 2009); ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.