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United States District Court, D. Rhode Island

August 28, 2018




         I. Introduction

         Before the Court is Defendants Hunt Companies, Inc., and Hunt Military Communities Management, LLC‘s (collectively, “Hunt” or “Defendants”) Motion to Dismiss (ECF No. 26) (“Motion”) Plaintiff's (“MHL”) Third Amended Complaint (ECF No. 25). In a hearing on July 23, 2018, the Court denied Defendants' Motion and indicated that its reasoning would be explained in this brief memorandum and order.

         II. Background [1]

         Defendants provide housing to military and civilian families located near or within military bases. (Third Am. Compl. (“Compl.”) ¶ 11, ECF No. 25.) Plaintiff MHL launched and kept up a website to serve Defendants, which included “a comprehensive forms and documents solution (the ‘Document Centers'), along with relevant community information for United States military personnel and/or their respective family members.” (Id. ¶ 12.)

         MHL alleges that, beginning in 2008, it agreed orally with Defendants to provide access to and use of its web portal, while creating and maintaining Document Centers for each of Defendants' military properties. (Id. ¶ 13.) Specifically, the parties agreed to two stages of work: in stage one, MHL created unique Document Centers for Defendants' military housing properties, making the transmission of housing documents for military families more efficient; then, in stage two, MHL regulated and maintained Defendants' Document Centers and provided around-the-clock customer service support for applicants. (Id. ¶ 14.) In exchange, Defendants agreed to provide MHL daily move-in reports for the military properties, which allowed MHL to earn lucrative commissions “by cross-selling related third-party provider products and services to [Defendants'] housing prospects.” (Id. ¶ 16.)

         MHL alleges that the parties' relationship persisted for a number of years without incident. (Id. ¶¶ 21, 23.) This was true, despite the parties' failure to memorialize the Document Centers contract in writing, as MHL had requested. (Id. ¶ 25.) Plaintiff alleges that “Hunt strung MHL along for many months by promising to review and sign a contract and preying upon MHL's mistaken belief of a long-term relationship with Hunt, ” (id. ¶ 39.); and further, that “[s]ince at least February 2017, however, and presumably much earlier, unbeknownst to MHL, Hunt was developing its own online document solution, had no intention of reviewing and signing a contract and planned to terminate its relationship with MHL.” (Id. ¶ 40.)

         In September of 2017, after nearly nine years of working together, MHL noticed a major change: “its daily new housing application submissions for Hunt properties suddenly went from approximately 30-40 per day to zero.” (Id. ¶ 46.) MHL discovered that Defendants removed MHL from their website without any notice, and replaced it with their own, newly minted document platform, one that appeared substantially similar to MHL's. (Id. ¶ 47.)

         MHL sums up: “with no advance notice at all, Hunt terminated the Document Services Contract and cut over to its own online document solution that it had been surreptitiously developing while at the same time concealing its plan to terminate the parties' contract and misrepresenting its intent to review and sign a contract and continue the relationship.” (Id. ¶ 57.) And from these factual allegations, MHL advances nine causes of action against Hunt.

         III. Legal Standard

         In assessing a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure, “the district court must ‘accept as true the well-pleaded factual allegations of the complaint, draw all reasonable inferences therefrom in the plaintiff's favor, and determine whether the complaint, so read, limns facts sufficient to justify recovery on any cognizable theory.'” Rivera v. Centro Medico de Turabo, Inc., 575 F.3d 10, 15 (1st Cir. 2009) (quoting LaChapelle v. Berkshire Life Ins. Co., 142 F.3d 507, 508 (1st Cir. 1998)). To overcome a motion to dismiss, a complaint must possess “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)).

         IV. Discussion

         Hunt volleys several arguments in attempt to undercut MHL's breach-of-contract ...

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