United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
S. SHAH UNITED STATES DISTRICT JUDGE.
John Heiman and JTE, Inc., bring this action against
defendant, Bimbo Foods Baking Distribution Company, for
breach of contract and tortious interference. Defendant moves
to dismiss the complaint. For the following reasons, the
motion is granted.
courts are courts of limited jurisdiction and “have
only the power that is authorized by Article III of the
Constitution and the statutes enacted by Congress pursuant
thereto.” Transit Express, Inc. v. Ettinger,
246 F.3d 1018, 1023 (7th Cir. 2001). The burden of
establishing that a district court has proper jurisdiction
lies with the plaintiff. Id. A defendant arguing
that a plaintiff has not met this burden may move for
dismissal under Federal Rule of Civil Procedure 12(b)(1).
When reviewing a 12(b)(1) motion, “[t]he district court
may properly look beyond the jurisdictional allegations of
the complaint and view whatever evidence has been submitted
on the issue to determine whether in fact subject matter
jurisdiction exists.” Grafon Corp. v.
Hausermann, 602 F.2d 781, 783 (7th Cir. 1979).
survive a motion to dismiss under Federal Rule of Civil
Procedure 12(b)(6), a complaint must contain factual
allegations that plausibly suggest a right to relief.
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The
court must accept all factual allegations as true and draw
all reasonable inferences in the plaintiff's favor, but
need not accept legal conclusions or conclusory allegations.
Id. at 678-79. Because “complaints need not
anticipate and attempt to plead around defenses, ” it
is uncommon for a court to dismiss a case for noncompliance
with the statute of limitations. United States v. N.
Trust Co., 372 F.3d 886, 888 (7th Cir. 2004). A motion
to dismiss a claim as barred by the statute of limitations
should be granted only where “the allegations of the
complaint itself set forth everything necessary to satisfy
the affirmative defense.” United States v.
Lewis, 411 F.3d 838, 842 (7th Cir. 2005).
John Heiman, entered into a contract with defendant, Bimbo
Foods Bakeries Distribution Company, in October 2000, to
distribute baked goods in a designated area.  ¶¶
2, 10. Heiman was the founder and owner of JTE,
Inc., through which he delivered the baked goods.
Id. ¶¶ 2, 6. Heiman later formally
assigned the contract to JTE. Id. ¶ 10. Heiman
resided in Illinois, and JTE had its primary place of
business in Schaumburg, Illinois. Id. ¶ 6.
Bimbo Foods was a Delaware corporation with its primary place
of business in Pennsylvania. Id. ¶
7.JTE was dissolved in 2014. Id.
distribution agreement provided, in relevant part:
“[Bimbo Foods] hereby recognizes DISTRIBUTOR'S
ownership of the Distribution Rights, which ownership will
continue until the Distribution Rights are sold or
transferred as provided herein. . . . The parties agree that
the Distribution Rights can be exercised only pursuant to the
terms of this Agreement and that any termination of this
Agreement requires DISTRIBUTOR or [Bimbo Foods], for the
account of DISTRIBUTOR, to sell Distribution Rights as
provided herein.” Id. ¶ 11. The agreement
distinguished between curable and non-curable breaches.
Id. ¶ 12. For curable breaches, Bimbo Foods was
required to give Heiman three days' written notice to
cure. Id. Non-curable breaches, which included those
involving criminal activity or fraud, threats to public
health or safety, and threats to do significant harm to Bimbo
Foods, its trademark, or reputation, did not require notice
or an opportunity to cure. Id. Repeated curable
violations constituted a non-curable breach by threatening
significant harm to Bimbo Foods and its reputation.
Id. The distribution rights were secured by a note
for $50, 600. Id. ¶ 13. The agreement also
contained a choice-of-law provision, providing that New York
law would govern disputes arising under the contract. [5-1]
substantially performed its obligations through January 13,
2011.  ¶ 14. In the spring of 2008, JTE alleges,
Bimbo Foods, through its employees, began fabricating curable
breaches by JTE, including false reports of poor service and
out-of-stock products at stores in JTE's distribution
area. Id. ¶ 16. Bimbo Foods employees removed
JTE-delivered products from customer shelves or pushed the
products to the side or back to photograph the empty shelves.
Id. ¶ 17. On one occasion, a distributor caught
a Bimbo Foods district manager removing products from a shelf
and taking a photograph. Id. ¶ 18. When caught,
Bimbo Foods assured JTE it would never happen again.
Id. But unbeknownst to JTE, Bimbo Foods continued
these tactics. Id. Bimbo Foods also spread false
statements regarding the quality of JTE's service to
damage JTE's reputation and devalue its distribution
rights. Id. ¶ 19. These actions were part of
Bimbo Foods' larger scheme to intimidate its distributors
into selling their routes to new operators, who would earn
lower commissions (18 percent, as opposed to the 22-percent
commission distributors received under older agreements, like
JTE's). Id. ¶ 22. JTE alleges that the
breaches Bimbo Foods asserted against it were fabricated to
pressure JTE into selling its distribution rights against its
will. Id. ¶ 24.
JTE refused to sell its distribution rights in January 2011,
Bimbo Foods breached the distribution agreement and
terminated JTE's distribution rights, citing multiple
fabricated, curable breaches. Id. ¶¶ 25,
33-36. Later that year, around September, Bimbo Foods caused
JTE to sell a portion of its distribution rights, and in
October, caused the sale of the remainder. Id.
¶ 26. The second purchaser bounced the check for the
purchase of his portion, and JTE received significantly below
fair-market value for the sale. Id. ¶¶
27-28. JTE first discovered Bimbo Foods' scheme in late
2013 or early 2014. Id. ¶ 22.
alleges that Bimbo Foods' termination of the distribution
agreement expressly violated the terms of that agreement and
that fabricating breaches to force JTE to sell its
distribution rights breached the implied covenant of good
faith and fair dealing. Id. ¶ 39. JTE also
alleges that Bimbo Foods caused JTE's rights to be sold
for less than fair-market value, in violation of the
agreement. Id. ¶ 41. And, JTE states, Bimbo
Foods tortuously interfered with its relationships with
stores in its distribution area with the intent to harm
JTE's relationships and drive down the value of its
distribution route. Id. ¶ 46.
Foods moves to dismiss Heiman's claims pursuant to Rule
12(b)(1), arguing that Heiman lacks standing. Bimbo Foods
also moves to dismiss all claims by both Heiman and JTE under
Rule 12(b)(6), as barred by the applicable statutes of
limitations. Illinois law governs the analysis, and the
motion to dismiss is granted.