United States District Court, N.D. Illinois, Eastern Division
ANTHONY B. FERGUSON, Plaintiff,
THE GOODMOJO CORP. and ALFRED CHEUNG, Defendants.
CHARLES P. KOCORAS, UNITED STATES DISTRICT JUDGE
the Court is Defendants the GoodMojo Corp.
(“GoodMojo”) and Alfred Cheung's
(“Cheung”) (collectively, the
“Defendants”) motion to dismiss Plaintiff Anthony
B. Ferguson's (“Ferguson”) first amended
complaint pursuant to Federal Rule of Civil Procedure
12(b)(6). For the following reasons, the Court grants in part
and denies in part the motion.
purposes of this motion, the Court accepts as true the
following facts from the amended complaint. Murphy v.
Walker, 51 F.3d 714, 717 (7th Cir. 1995). All reasonable
inferences are drawn in Ferguson's favor. Tamayo v.
Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008).
GoodMojo is a Delaware corporation with its principal place
of business in California. GoodMojo is a computer software
development and applications business which provides services
to governmental agencies, not-for-profit organizations, and
small businesses. Defendant Cheung is a California resident
and GoodMojo's chief executive officer, having co-founded
the company in March of 2015. Plaintiff Ferguson, an Illinois
resident, served as GoodMojo's general counsel and head
of business development from April 30, 2015 until May 4,
its formation, GoodMojo has had issues with its liquidity. As
a result, Ferguson did not collect a salary for most his
employment period. Further, GoodMojo requested that Ferguson
incur expenses on the company's behalf with the
understanding that he would be reimbursed for those expenses.
Specifically, Ferguson incurred expenses related to a $105,
000 loan, a $32, 000 state tax payment, and $151, 000 in
miscellaneous company expenses.
respect to the loan, on or about January 12, 2017, Ferguson,
GoodMojo, and Cheung, as borrowers, executed a note payable
to Timothy J. Rand (“Rand”), as lender and note
holder, in the principal amount of $105, 000. To secure the
note, the parties entered into a loan agreement (collectively
referred to as the “loan documents”). On June 15,
2017, approximately six weeks before the note matured, Rand
assigned and transferred all of his rights and interest in
the loan documents to Ferguson. On June 28, 2018, Ferguson
demanded the note be repaid. According to the complaint, the
note has been in default since August 1, 2017, with $115, 500
owed to Ferguson.
the state tax payment, Ferguson entered into an agreement
with Cheung on March 29, 2018 to advance $32, 000 to GoodMojo
to satisfy the Employment Development Department tax imposed
by the State of California. In exchange, once GoodMojo
received its tax refund, it would repay Ferguson. However,
once GoodMojo received its tax refund on June 15, 2018, it
did not reimburse Ferguson.
Ferguson incurred over $151, 000 in company expenses between
2015 and 2018. These expenses ranged from transportation and
lodging to corporate filing fees and company loans. Despite a
demand for repayment, GoodMojo has failed to reimburse
Ferguson for these costs.
October 15, 2018, Ferguson filed his first amended complaint
against the Defendants, alleging claims for breach of
contract, unjust enrichment, and a violation of the
California Labor Code. On December 17, 2018, the Defendants
filed the instant motion to dismiss pursuant to Federal Rule
of Civil Procedure 12(b)(6).
motion to dismiss pursuant to Federal Rule of Civil Procedure
12(b)(6) “tests the sufficiency of the complaint, not
the merits of the case.” McReynolds v. Merrill
Lynch & Co., 694 F.3d 873, 878 (7th Cir. 2012). The
allegations in the complaint must set forth a “short
and plain statement of the claim showing that the pleader is
entitled to relief.” Fed.R.Civ.P. 8(a)(2). Plaintiffs
need not provide detailed factual allegations, but they must
provide enough factual support to raise their right to relief
above a speculative level. Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 555 (2007). A claim must be
facially plausible, meaning that the pleadings must
“allow…the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). The claim must be described “in sufficient
detail to give the defendant ‘fair notice of what
the…claim is and the grounds upon which it
rests.'” E.E.O.C. v. Concentra Health Servs.,
Inc., 496 F.3d 773, 776 (7th Cir. 2007) (quoting
Twombly, 550 U.S. at 555). “Threadbare
recitals of the elements of a cause of action, supported by
mere conclusory statements, ” are insufficient to
withstand a 12(b)(6) motion to dismiss. Iqbal, 556
U.S. at 678.