Barkan v. Dunkin' Donuts, Inc.

520 F. Supp. 2d 333, 2007 U.S. Dist. LEXIS 80476, 2007 WL 3156288
CourtDistrict Court, D. Rhode Island
DecidedOctober 30, 2007
DocketC.A. 05-050L
StatusPublished
Cited by8 cases

This text of 520 F. Supp. 2d 333 (Barkan v. Dunkin' Donuts, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Rhode Island primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Barkan v. Dunkin' Donuts, Inc., 520 F. Supp. 2d 333, 2007 U.S. Dist. LEXIS 80476, 2007 WL 3156288 (D.R.I. 2007).

Opinion

MEMORANDUM AND ORDER

RONALD R. LAGUEUX, Senior District Judge.

This matter is before the Court on two motions filed by Defendants Dunkin’ Donuts, Inc., and Baskin-Robbins USA, Co. (“Defendants”): a motion to dismiss Counts III, IV and V of Plaintiffs’ First Amended Verified Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6); and a motion to strike Plaintiffs’ jury demand and multiple damages demand, pursuant to Federal Rule of Civil Procedure 12(f). For the reasons detailed below, the Court denies Defendants’ motion to dismiss Count III, grants the motion to dismiss Counts IV and V, and denies Defendants’ motion to strike the jury demand.

Standard of Review

Defendants move to dismiss the claims against them pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure for failure to state a claim upon which relief may be granted. In considering a Rule 12(b)(6) motion, a court must accept as true all allegations in the complaint and draw all reasonable inferences in the plaintiffs favor. Aulson v. Blanchard, 83 F.3d 1, 3 (1st Cir.1996). The United States Supreme Court, in recently abrogating the frequently-cited Conley v. Gibson, 355 U.S. 41, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957), restated the standard as follows: “[Ojnce a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint.” Bell Atlantic Corp. v. Twombly, — U.S. -, 127 S.Ct. 1955, 1969, 167 L.Ed.2d 929 (2007).

Ordinarily, a court may not consider any documents that are outside of the complaint, or not expressly incorporated therein, unless the motion is converted into one for summary judgment. Alternative Energy, Inc. v. St. Paul Fire & Ma *336 rine Ins. Co., 267 F.3d 30, 33 (1st Cir. 2001). Courts, however, make an exception “for documents the authenticity of which are not disputed by the parties; for official public records; for documents central to plaintiffs’ claim; or for documents sufficiently referred to in the complaint.” Watterson v. Page, 987 F.2d 1, 3 (1st Cir. 1993). When a complaint’s factual allegations are linked to and dependent upon a document whose authenticity is not challenged, such a document “merges into the pleadings” and the court may properly consider it under a Rule 12(b)(6) motion to dismiss. Alternative Energy, 267 F.3d at 33 (quoting Beddall v. State St. Bank & Trust Co., 137 F.3d 12, 17 (1st Cir.1998)).

“[T]he problem that arises when a court reviews statements extraneous to a complaint generally is the lack of notice to the plaintiff .... Where plaintiff has actual notice ... and has relied upon these documents in framing the complaint[,] the necessity of translating a Rule 12(b)(6) motion into one under Rule 56 is largely dissipated.” Cortec Indus. Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir. 1991).

In this case, Plaintiffs refer to franchise agreements between Defendants and corporate entities owned by Barkan (which are not parties in this case), as well as to Store Development Agreements (“SDAs”) between Plaintiffs and Defendants. Neither the SDAs nor the franchise agreements are attached as exhibits to the First Amended Verified Complaint (“Complaint”). While the heart of Plaintiffs’ Complaint is a breach of contract case based on allegations that the Defendants breached the Settlement Agreement, which is attached to the Complaint, Plaintiffs nonetheless refer to the SDAs in Count I and Count II of the Complaint. 1 Indeed, the dollar amount at which Plaintiffs value the SDAs appears to comprise their damages claim in its entirety. Defendants attach copies of the SDAs to their Motion to Dismiss. Because Plaintiffs’ factual allegations are linked to these contracts and their authenticity is not disputed, this Court has considered these documents without converting the Motion to Dismiss into a motion for summary judgment.

Facts

Accepting as true all of Plaintiffs’ allegations, the Court summarizes the facts alleged in Plaintiffs’ Complaint. Plaintiff Irwin Barkan (“Barkan”) is the owner of Plaintiff D & D Barkan LLC (“D & D”), a Rhode Island limited liability company (collectively, “Plaintiffs”). In 2002 and 2003, five separate legal entities wholly-owned by Barkan (“the Barkan corporate entities”) each entered into a franchise agreement with Defendants for the operation of five existing Dunkin’ Donuts shops in Providence, Rhode Island. In May 2002, D & D entered into a Store Development Agreement (“SDA”) with Defendants for the development of an additional Dun-kin’ Donuts shop in Providence (“Providence SDA”). (Defs.’ Mot. Dismiss Jeffrey S. Brenner Declaration Ex. A.) In 2003, Barkan entered into three additional SDAs with Defendants for the development of additional shops in East Greenwich, Rhode Island (“East Greenwich SDA”), Burrillville, Rhode Island (“Burrillville SDA”), and Cranston, Rhode Island (“Cranston SDA”). (Id. Exs. B, C, D.)

Each of the SDAs required “the Developer” (D & D in the Providence SDA, and Barkan in the remaining SDAs), within a limited time frame, to construct and open a *337 specified number of Dunkin’ Donuts shops, the “Specified Unit” referred to in the agreements. (Id. Exs. A-D, ¶ 1A.) The contracts also included several restrictions on Plaintiffs’ ability to sell or otherwise transfer their development rights under the SDAs, including that, prior to any transfer, “Developer must have opened at least one Specified Unit covered by this Agreement.” (Id. Exs., A-D, ¶ 13B.) These SDAs also contain jury waiver provisions and limitations on damages provisions that foreclose the possibility of any claim for punitive, multiple and/or exemplary damages. (Id. Exs. A-D, ¶ 18F.)

In 2004, Barkan opened a Dunkin’ Donuts shop in Burrillville (pursuant to the Burrillville SDA) and in Warwick, Rhode Island, (pursuant to the East Greenwich SDA), but no shops were developed pursuant to the Providence or Cranston SDAs.

Financing for the franchise agreements and the SDAs was provided by CIT, a lender associated with Defendants. Defendants introduced Plaintiffs to CIT, helped arrange the loan for Plaintiffs, and guaranteed it. In 2003, Plaintiffs sought to restructure their debt to CIT and resolve disputes with Defendants. After several proposals were rejected by Defendants, on June 15, 2004, Defendants and Plaintiffs entered into a Settlement Agreement.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
520 F. Supp. 2d 333, 2007 U.S. Dist. LEXIS 80476, 2007 WL 3156288, Counsel Stack Legal Research, https://law.counselstack.com/opinion/barkan-v-dunkin-donuts-inc-rid-2007.