Quidore v. All. Plastics, LLC, 2020 NCBC 39.
STATE OF NORTH CAROLINA IN THE GENERAL COURT OF JUSTICE SUPERIOR COURT DIVISION MECKLENBURG COUNTY 19 CVS 23648
KEVIN QUIDORE,
Plaintiff, ORDER AND OPINION ON v. DEFENDANTS’ MOTION TO DISMISS ALLIANCE PLASTICS, LLC; and AND PLAINTIFF’S MOTION FOR RONALD GRUBBS, JR., JURISDICTIONAL DISCOVERY Defendants.
1. THIS MATTER is before the Court upon Defendants’ Motion to Dismiss
Pursuant to Rule 12(b)(6) and Rule 12(b)(2), North Carolina Rules of Civil Procedure
(“Motion to Dismiss”), (ECF No. 10), and Plaintiff’s Motion for Jurisdictional
Discovery (“Discovery Motion”), (ECF No. 15), (together, the “Motions”).
2. Plaintiff Kevin Quidore (“Quidore”) contends that Defendant Alliance
Plastics, LLC (“Alliance” or the “Company”) promised, but did not provide, certain
valuable benefits in connection with his agreement to leave secure employment in
California and move to Charlotte, North Carolina to accept a high-ranking position
with the Company in 2017. Alliance moves to dismiss Quidore’s claims against it,
contending that Alliance is not subject to personal jurisdiction in North Carolina and
that, even if it is, Quidore has failed to state an actionable claim for fraud against the
Company, necessitating dismissal of at least that claim (“Alliance’s Motion to
Dismiss”). Quidore opposes dismissal on both theories and brings the Discovery
Motion should the Court find Quidore’s current evidence insufficient to support
personal jurisdiction over Alliance. 3. Defendant Ronald Grubbs, Jr. (“Grubbs”) also moved to dismiss Quidore’s
claims against him, arguing that since Grubbs was authorized to act on behalf of
Alliance, the individual claims against Grubbs may not be sustained and, further,
that there is no actionable claim for fraud against him (“Grubbs’ Motion to Dismiss”).
Quidore has since dismissed all claims against Grubbs without prejudice.
4. Having considered the Motions, the related briefing, and the arguments of
counsel at the hearing on the Motions, the Court hereby DENIES as moot Grubbs’
Motion to Dismiss, DENIES Alliance’s Motion to Dismiss, and DENIES as moot the
Discovery Motion.
Rayburn Cooper & Durham, P.A., by Ross R. Fulton and Matthew Tomsic, for Plaintiff Kevin Quidore.
Morton & Gettys, LLC, by James Nathanial Pierce and Beverly A. Carroll, for Defendants Alliance Plastics, LLC and Ronald Grubbs, Jr.
Bledsoe, Chief Judge.
I.
PROCEDURAL BACKGROUND
5. On December 12, 2019, Quidore filed the Complaint, alleging claims for
breach of contract, fraud, and promissory estoppel against Alliance and,
alternatively, against Grubbs, Alliance’s president and the owner of at least 50% of
the Company. 1 (Compl., ECF No. 4.)
1 In his affidavit filed in support of Alliance’s Rule 12(b)(2) Motion, Grubbs avers that he
holds “the majority of the membership interest in [Alliance.]” (Defs.’ Mem. Supp. Mot. Dismiss Ex. B, at ¶ 2 [hereafter “Grubbs Aff.”], ECF No. 11.1.) 6. On February 3, 2020, Defendants filed the Motion to Dismiss, seeking
dismissal of this action against Alliance under Rule 12(b)(2) of the North Carolina
Rules of Civil Procedure (“Rule(s)”) for lack of personal jurisdiction and against
Grubbs under Rule 12(b)(6) for failure to assert facts supporting individual (rather
than agency-based) claims against him. Grubbs and Alliance have separately moved
to dismiss Quidore’s fraud claim against them under Rule 12(b)(6), primarily for
failure to allege a misrepresentation of a pre-existing fact.
7. Quidore filed the Discovery Motion on February 24, 2020, seeking
jurisdictional discovery concerning Alliance’s contacts with North Carolina should
the Court find Alliance’s jurisdictional contacts insufficient to support personal
jurisdiction on the current record.
8. The Court held a hearing on the Motions on March 13, 2020, at which all
parties were represented by counsel.
9. After the hearing, on May 6, 2020, Quidore and Grubbs stipulated to the
dismissal of this action against Grubbs without prejudice. (Stipulation Dismissal
Without Prejudice Claims Against Ronald Grubbs, Jr., ECF No. 25.) As a result, the
Motion to Dismiss shall be denied as moot as to Grubbs, and the Court will address
only the Motion to Dismiss on the grounds asserted by Alliance.
10. Alliance’s Motion to Dismiss and the Discovery Motion are now ripe for
resolution. II.
ALLIANCE’S 12(B)(2) MOTION
A. Legal Standard
11. “When a defendant challenges the court’s jurisdiction under Rule 12(b)(2),
the burden falls on the plaintiff to establish that grounds for asserting [personal]
jurisdiction exist.” AYM Techs., LLC v. Rodgers, 2018 NCBC LEXIS 14, at *6 (N.C.
Super. Ct. Feb. 9, 2018); see also Filmar Racing, Inc. v. Stewart, 141 N.C. App. 668,
671, 541 S.E.2d 733, 736 (2001) (“The burden is on the plaintiff to prove by a
preponderance of the evidence that grounds exist for the exercise of personal
jurisdiction over a defendant.”).
12. In a case where, as here, “both parties submit competing affidavits . . . and
the trial court holds a hearing on personal jurisdiction, the trial court should consider
the matter as if an evidentiary hearing had occurred.” AYM Techs., 2018 NCBC
LEXIS 14, at *6–7. “In such circumstances, the trial court must ‘act as a fact-finder,
and decide the question of personal jurisdiction by a preponderance of the
evidence[.]’ ” Parker v. Town of Erwin, 243 N.C. App. 84, 97, 776 S.E.2d 710, 721
(2015) (quoting Deer Corp. v. Carter, 177 N.C. App. 314, 322, 629 S.E.2d 159, 166
(2006)); see also Banc of Am. Sec. LLC v. Evergreen Int’l Aviation, Inc., 169 N.C. App.
690, 694, 611 S.E.2d 179, 183 (2005) (Where there are “dueling affidavits[,]” the Court
“must determine the weight and sufficiency of the evidence [presented in the
affidavits] much as a juror.” (quoting Fungaroli v. Fungaroli, 51 N.C. App. 363, 367,
276 S.E.2d 521, 524, disc. review denied, 303 N.C. 314, 281 S.E.2d 651 (1981))). 13. Accordingly, the Court makes the following findings of fact and conclusions
of law in resolving Alliance’s Motion to Dismiss under Rule 12(b)(2) (“Rule 12(b)(2)
Motion”).
B. Findings of Fact
14. The Court makes the following findings of facts solely for purposes of ruling
on the present Rule 12(b)(2) Motion. 2
15. Grubbs lived in Charlotte, North Carolina at all relevant times herein.
Quidore lived in California until he moved to Charlotte in August 2017. (Mem. Law
Opp’n Defs.’ Mot. Dismiss Ex. A, at ¶¶ 5, 10, 15, 18 [hereafter “Quidore Aff.”], ECF
No. 14.1.)
16. Alliance is a South Carolina corporation established in 2003, with its
principal place of business located in Rock Hill, South Carolina. (Grubbs Aff. ¶ 4.)
Alliance is in the business of “converting and distributing stretch film” and
“manufacturing cornerboard . . . and industrial quality hand tapes.” (Grubbs Aff.
¶ 3.)
17. Quidore lived and worked in California, (Grubbs Aff. ¶ 10), before Grubbs
recruited him to become Alliance’s Chief Operating Officer (“COO”) in late 2016 and
early 2017, (Quidore Aff. ¶¶ 4, 6, 10). In recruiting Quidore for Alliance, Grubbs
communicated with Quidore through telephone calls, emails, and texts, “some” of
which Quidore avers originated from Grubbs’ home in Charlotte. In addition, Quidore
traveled from his home in California to Charlotte on two separate occasions for multi-
2 Any determination later stated as a Conclusion of Law that should have been stated as a
finding of fact is incorporated in these Findings of Fact. day meetings with Grubbs in North Carolina to discuss and negotiate his potential
employment. (Quidore Aff. ¶¶ 5–7, 10–11.)
18. After becoming Alliance’s COO, Quidore initially consulted for the
Company, which required him to fly into Charlotte from California approximately
once a month for five months. (Quidore Aff. ¶¶ 11–12.) Grubbs allowed Quidore to
use Grubbs’ North Carolina-registered car while Quidore was in the area, (Quidore
Aff. ¶ 12), and also encouraged Quidore to visit Charlotte with his family during this
time, (Quidore Aff. ¶ 14). To that end, Alliance paid for Quidore to bring his family
to Charlotte for a one-week visit prior to his official start date. (Quidore Aff. ¶ 14.)
19. In August 2017, Quidore moved to Charlotte permanently with his family.
(Quidore Aff. ¶ 15.) Although disputed by Defendants, (Defs.’ Reply Pl.’s Mem. Opp’n
Defs.’ Mot. Dismiss Ex. B, at ¶¶ 12, 14, ECF No. 19.1), the Court finds that while
acting as COO, Quidore performed regular and continuous work on behalf of Alliance
in North Carolina, (Quidore Aff. ¶ 16), including meeting monthly with Grubbs in
North Carolina to conduct a “comprehensive review of [Alliance’s] business,” (Quidore
Aff. ¶ 19), frequently entertaining, networking, and transacting business in North
Carolina with existing customers, suppliers, and vendors, (Quidore Aff. ¶¶ 17, 23–
25), and routinely working from his North Carolina home on nights and weekends an
average of fifteen hours each week, (Quidore Aff. ¶ 18). The Court further finds that
Grubbs approved Quidore’s North Carolina-based work for Alliance and often worked
on Alliance business in North Carolina as well. (Quidore Aff. ¶ 18.) 20. Following Quidore’s termination from Alliance, Quidore requested a
meeting with Grubbs in Charlotte to discuss the termination. At the meeting, Grubbs
advised him that Alliance would not provide the benefits Quidore contends that
Grubbs promised him during his recruitment. (Quidore Aff. ¶ 19.)
C. Conclusions of Law
21. Based on the foregoing Findings of Fact, the Court makes the following
Conclusions of Law. 3
22. Alliance argues that the Company, as a South Carolina LLC based in and
operating from Rock Hill, South Carolina with no North Carolina property or
facilities, is not properly subject to personal jurisdiction in this Court. (Defs.’ Mem.
Supp. Mot. Dismiss 7–9, ECF No. 11.) In opposition, Plaintiff argues that Alliance
has submitted to jurisdiction in North Carolina in three ways: (i) by accepting service
of process, (ii) by filing a notice of appearance, and (iii) by engaging in constitutionally
sufficient minimum contacts with this State both generally and specifically based on
its recruitment of, employment of, and refusal to pay benefits to Quidore. (Mem. Law
Opp’n Defs.’ Mot. Dismiss 5–16, ECF No. 14.) The Court declines to address Quidore’s
first two contentions in light of its resolution of the third.
23. The Supreme Court of North Carolina has recently reiterated that “[i]n
examining whether a nonresident defendant is subject to personal jurisdiction in our
courts,” trial courts should engage in a “two-step analysis”: “First, jurisdiction over
the defendant must be authorized by N.C.G.S. § 1-75.4—North Carolina’s long-arm
3 Any Findings of Fact that are more appropriately deemed Conclusions of Law are incorporated by reference into the Court’s Conclusions of Law. statute. Second, if the long-arm statute permits consideration of the action, exercise
of jurisdiction must not violate the Due Process Clause of the Fourteenth Amendment
to the U.S. Constitution.” Beem USA LLLP v. Grax Consulting, LLC, 838 S.E.2d 158,
161 (N.C. 2020) (citation and internal quotation marks omitted).
24. “[B]ecause North Carolina’s long-arm statute has been interpreted to allow
the exercise of personal jurisdiction to the fullest extent allowed under the due
process clause, the two-step analysis collapses into one inquiry[,]” Worley v. Moore,
2017 NCBC LEXIS 15, at *19 (N.C. Super. Ct. Feb. 28, 2017), namely, “whether [the]
defendant has the minimum contacts necessary to meet the requirements of due
process[,]” Filmar Racing, 141 N.C. App. at 671, 541 S.E.2d at 736 (quoting Hiwassee
Stables, Inc. v. Cunningham, 135 N.C. App. 24, 27, 519 S.E.2d 317, 320 (1999)).
25. For a court to exercise personal jurisdiction, “there must be sufficient
minimum contacts between the nonresident defendant and our state such that the
maintenance of the suit does not offend traditional notions of fair play and substantial
justice.” Skinner v. Preferred Credit, 361 N.C. 114, 122, 638 S.E.2d 203, 210 (2006)
(quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)) (internal quotation
marks omitted). As our Supreme Court explained in Beem:
Personal jurisdiction cannot exist based upon a defendant’s “random, fortuitous, or attenuated” contacts with the forum state, Walden v. Fiore, 571 U.S. 277, 286, 188 L. Ed. 2d 12, 21 (2014) (quoting Burger King, 471 U.S. at 475, 85 L. Ed. 2d at 543), but rather must be the result of “some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws,” Skinner, 361 N.C. at 133, 638 S.E.2d at 217 (quoting Hanson v. Denckla, 357 U.S. 235, 253, 2 L. Ed. 2d 1283, 1298 (1958)). As such, a defendant’s contacts with the forum state must be such that a defendant “should reasonably anticipate being haled into court there.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 62 L. Ed. 2d 490, 501 (1980); see also Skinner, 361 N.C. at 133, 638 S.E.2d at 217 (“A crucial factor is whether the defendant had reason to expect that he might be subjected to litigation in the forum state.”).
838 S.E.2d at 162.
26. The Court further summarized:
The United States Supreme Court has recognized two types of personal jurisdiction that can exist with regard to a foreign defendant: general (or “all-purpose”) jurisdiction and specific (or “case-based”) jurisdiction. See Daimler AG v. Bauman, 571 U.S. 117, 126–27, 187 L. Ed. 2d 624, 633–34 (2014) (citing Helicopteros, 466 U.S. at 414 nn.8–9, 80 L. Ed. 2d at 411 nn.8–9). General jurisdiction is applicable in cases where the defendant’s “affiliations with the State are so ‘continuous and systematic’ as to render them essentially at home in the forum State.” Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919, 180 L. Ed. 2d 796, 803 (2011) (quoting Int’l Shoe, 326 U.S. at 317, 90 L. Ed. at 102). Specific jurisdiction, conversely, encompasses cases “in which the suit ‘aris[es] out of or relate[s] to the defendant’s contacts with the forum.’ ” Daimler, 571 U.S. at 127, 187 L. Ed. 2d at 633–34 (2014) (alteration in original) (quoting Helicopteros, 466 U.S. at 414 n.8, 80 L. Ed. 2d at 411 n.8).
Id.
27. Alliance contends that it is not subject to either general or specific
jurisdiction in this Court. The Court turns first to specific jurisdiction. As explained
in Beem:
Specific jurisdiction is, at its core, focused on the “relationship among the defendant, the forum, and the litigation.” Daimler, 571 U.S. at 133, 187 L. Ed. 2d at 637 (quoting Shaffer v. Heitner, 433 U.S. 186, 204, 53 L. Ed. 2d 683, 698 (1977)). Some “affiliatio[n] between the forum and the underlying controversy” is required. Walden, 571 U.S. at 283 n.6, 188 L. Ed. 2d at 20 n.6 (alteration in original) (quoting Goodyear, 564 U.S. at 919, 180 L. Ed. 2d at 803). The United States Supreme Court has emphasized that “specific jurisdiction is confined to adjudication of issues deriving from, or connected with, the very controversy that establishes jurisdiction.” Bristol-Myers Squibb Co. v. Sup. Ct. of Cal., San Francisco Cty., 137 S. Ct. 1773, 1780 (U.S. 2017) (quoting Goodyear, 564 U.S. at 919, 180 L. Ed. 2d at 803).
Id. at 162–63.
28. “[F]or purposes of asserting ‘specific’ jurisdiction, a defendant has ‘fair
warning’ that he may be sued in a state for injuries arising from activities that he
‘purposefully directed’ toward that state’s residents.” Tom Togs, Inc. v. Ben Elias
Indus., 318 N.C. 361, 366, 348 S.E.2d 782, 786 (1986) (quoting Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 472 (1985)). “[T]he trial court must carefully scrutinize the
facts . . . to determine if a defendant’s dispute-related contacts with the forum state
constitute sufficient minimum contacts to exercise personal jurisdiction[.]” Soma
Tech., Inc. v. Dalamagas, 2017 NCBC LEXIS 26, at *11–12 (N.C. Super. Ct. Mar. 24,
2017).
29. Of particular relevance, our Supreme Court has held that “a single contract
may be a sufficient basis for the exercise of [specific] jurisdiction if it has a substantial
connection with this State.” Beem, 838 S.E.2d at 163 (quoting Tom Togs, 318 N.C. at
367, 348 S.E.2d at 786). The fact that a contract is “made in North Carolina” and
“substantially performed” in the State is particularly relevant for this analysis. Id.
(quoting Tom Togs, 318 N.C. at 367, 348 S.E.2d at 786–87).
30. Significantly for the Court’s analysis in this case, in its recent decision in
Beem, the Supreme Court found specific jurisdiction to exist where, in part, the
defendant’s representative traveled to North Carolina on three separate occasions
and contacted his co-partner in North Carolina once a month to discuss partnership
matters, “establish[ing] an ongoing relationship with persons and entities located within this [S]tate.” Id. at 164. The Court explained that personal jurisdiction was
properly exercised over the defendant, “[g]iven that (1) [the defendant’s] contacts with
North Carolina all related to [the plaintiff’s] partnership agreement and the
implementation thereof, and (2) this case is wholly concerned with the conduct of [the
defendant] pursuant to that agreement[.]” Id. at 165.
31. Similarly here, Alliance’s contacts with North Carolina in connection with
Quidore’s recruitment, his work for Alliance, and Alliance’s alleged breach of contract
are directly related to Quidore’s claims for payment of agreed-upon benefits and are
constitutionally sufficient to permit the exercise of personal jurisdiction over Alliance
in this action. In particular, Quidore’s claims arise from Alliance’s alleged promises
during Quidore’s recruitment and employment at the Company and from Alliance’s
decision to terminate Quidore’s employment and reject his demands for further
payment. (Compl. ¶¶ 35–38, 46–53, 64–67.) Alliance’s forecasted defense—that
Quidore failed to meet certain employment objectives precluding his realization of
any promised benefits and necessitating his termination—arises from Quidore’s job
performance during his employment. (Defs.’ Mem. Supp. Mot. Dismiss 1–2.)
32. The relevant dispute-related contacts for purposes of determining personal
jurisdiction are therefore those Alliance had with North Carolina concerning
Quidore’s recruitment and performance and Alliance’s refusal to pay the benefits
Quidore contends are due under the Agreement. See, e.g., Teague & Glover, P.A. v.
Kane & Silverman P.C., 2019 N.C. App. LEXIS 92, at *14 (N.C. Ct. App. Feb. 5, 2019)
(“When determining whether a contract has a ‘substantial connection’ with North Carolina,” the Court should consider factors such as: “(1) whether the contract was
‘made’ in the forum state; (2) whether the defendant knew that the contract was going
to be ‘substantially performed’ in the forum state; (3) and whether the defendant was
aware that the other contracted party resided in the forum state.” (quoting Tom Togs,
318 N.C. at 367, 348 S.E.2d at 786–87)); see also, e.g., Burger King, 471 U.S. at 479
(“It is these factors – prior negotiations and contemplated future consequences, along
with the terms of the contract and the parties’ actual course of dealing – that must
be evaluated in determining whether the defendant purposefully established
minimum contacts within the forum.”).
33. The Court concludes that the following facts establish this Court’s specific
jurisdiction over Alliance even more persuasively than the defendant’s contacts found
constitutionally sufficient in Beem.
34. First, the employment contract on which this action is based was solicited
from, and substantially negotiated in, North Carolina. Indeed, Alliance recruited
Quidore through telephone calls, emails, and texts, some of which Grubbs originated
in North Carolina, and convened at least two multi-day meetings with Quidore in
North Carolina to solicit him to join the Company. (Quidore Aff. ¶¶ 5–7, 10); see
Carson v. Brodin, 160 N.C. App. 366, 372, 585 S.E.2d 491, 496 (2003) (“By negotiating
within the state and entering into a contract with North Carolina residents,
defendant purposefully availed himself of the privilege of conducting activities within
North Carolina with the benefits and protection of its laws.”); Mabry v. Fuller-
Shuwayer Co., 50 N.C. App. 245, 251, 273 S.E.2d 509, 513 (1981) (“We find persuasive the fact that the contract upon which this action for breach is based . . . arose out of
solicitations and was substantially negotiated here.”).
35. Second, Alliance permitted Quidore to perform the contract in significant
part in North Carolina—contract performance that Alliance has forecasted is central
to its defense against Quidore’s claims. See Tom Togs, 318 N.C. at 367, 348 S.E.2d
at 786 (finding personal jurisdiction in North Carolina, in part, because defendant
knew the contract at issue would be substantially performed in this State). Alliance
permitted Quidore to perform regular and continuous work in North Carolina as COO
of Alliance, (Quidore Aff. ¶ 16), including working from his Charlotte home
approximately fifteen hours each week, (Quidore Aff. ¶ 18), regularly meeting with
Grubbs in Charlotte for scheduled comprehensive reviews of Alliance’s business,
(Quidore Aff. ¶ 19), and entertaining, networking, and transacting business with
suppliers, customers, and vendors in Charlotte, (Quidore Aff. ¶¶ 17, 23–25), all to
further Alliance’s business objectives, see Chapman v. Janko, U.S.A., Inc., 120 N.C.
App. 371, 373, 376, 462 S.E.2d 534, 536, 538 (1995) (finding jurisdiction over non-
resident, non-domesticated corporation in action for breach of contract for
consultation services by resident plaintiff where plaintiff performed substantial
services for corporation in North Carolina, even though employer had no employees
residing in North Carolina and only made contact with plaintiff from outside North
Carolina); Unitrac, S.A. v. S. Funding Corp., 75 N.C. App. 142, 145, 330 S.E.2d 44,
46 (1985) (“Our courts have found that [due process is satisfied] if the contract is
made or is to be performed in North Carolina[.]”). 36. Third, Alliance’s alleged breach of contract occurred in North Carolina. In
particular, at a meeting Grubbs convened in Charlotte, Grubbs advised Quidore that
Alliance would not pay the benefits that Quidore had demanded and now seeks to
recover in this litigation. (Quidore Aff. ¶ 19; Compl. ¶ 30.) Therefore, the act giving
rise to Quidore’s breach of contract claim occurred in this State, a further basis to
support specific jurisdiction over Alliance in this State. See, e.g., Gen. Elec. Co. v.
Deutz AG, 270 F.3d 144, 150 (3d Cir. 2001) (“In contract cases, courts should inquire
whether the defendant’s contacts with the forum were instrumental in either the
formation of the contract or its breach.”); Phillips Exeter Acad. v. Howard Phillips
Fund, Inc., 196 F.3d 284, 289 (1st Cir. 1999) (to similar effect).
37. Finally, the Court concludes that the quantity, nature, and quality of
Alliance’s contacts with North Carolina, and the source and connection of Quidore’s
claims to those contacts, all as discussed more fully above, are sufficient to permit the
exercise of specific jurisdiction over Alliance in this action. See, e.g., New Bern Pool
& Supply Co. v. Graubart, 94 N.C. App. 619, 624, 381 S.E.2d 156, 159 (1989) (listing
these, among others, as relevant factors for minimum contacts analysis). And
Alliance has offered no persuasive evidence that requiring Alliance to litigate this
action in Mecklenburg County, North Carolina, a short distance from its Rock Hill,
South Carolina headquarters, would be unfair or unreasonable in the circumstances
here. See Burger King, 471 U.S. at 477 (“[W]here a defendant who purposefully has
directed his activities at forum residents seeks to defeat jurisdiction, he must present
a compelling case that the presence of some other considerations would render jurisdiction unreasonable.”); see also Cherry Bekaert & Holland v. Brown, 99 N.C.
App. 626, 635, 394 S.E.2d 651, 657 (1990) (“When ‘[t]he inconvenience to defendant
of litigating in North Carolina is no greater than would be the inconvenience of
plaintiff of litigating in [defendant’s state] . . . no convenience factors . . . are
determinative of the jurisdictional issue.’ ” (quoting Harrelson Rubber Co. v. Layne,
69 N.C. App. 577, 587, 317 S.E.2d 737, 743 (1984))); ETR Corp. v. Wilson Welding
Serv., Inc., 96 N.C. App. 666, 669, 386 S.E.2d 766, 768 (1990) (“Defendant has failed
to demonstrate any reason why the exercise of jurisdiction over it would be unfair.
North Carolina is as convenient a forum as any to resolve this dispute.”).
38. Based on the foregoing, the Court concludes that Alliance has engaged in
various acts in North Carolina by which it has “purposefully avail[ed] itself of the
privilege of conducting activities within [this] State,” Skinner, 361 N.C. at 133, 638
S.E.2d at 217 (quoting Hanson, 357 U.S. at 253), and “should [have] reasonably
anticipate[d] being haled into court” here, World-Wide Volkswagen, 444 U.S. at 297.
39. Accordingly, for the reasons set forth above, the Court concludes that
Alliance has sufficient minimum contacts with North Carolina arising from its
recruitment and employment of Quidore, and its refusal to pay Quidore the benefits
he alleges Alliance promised to pay, to permit the Court’s exercise of specific
jurisdiction over Alliance in this action consistent with due process. 4
4 In light of the Court’s determination that Alliance is subject to the specific jurisdiction of
this Court in this action, the Court both declines to address Quidore’s further contention that Alliance is subject to this Court’s general jurisdiction and denies Quidore’s Discovery Motion as moot. III.
ALLIANCE’S 12(B)(6) MOTION
40. When considering a motion to dismiss under Rule 12(b)(6), the Court views
the allegations in the complaint “in the light most favorable to the non-moving
party[,]” Christenbury Eye Ctr., P.A. v. Medflow, Inc., 370 N.C. 1, 5, 802 S.E.2d 888,
891 (2017) (quoting Kirby v. N.C. Dep’t of Transp., 368 N.C. 847, 852, 786 S.E.2d 919,
923 (2016)), and determines “whether the allegations of the complaint, if treated as
true, are sufficient to state a claim upon which relief may be granted under some
legal theory[,]” Corwin v. British Am. Tobacco PLC, 371 N.C. 605, 615, 821 S.E.2d
729, 736 (2018) (quoting CommScope Credit Union v. Butler & Burke, LLP, 369 N.C.
48, 51, 790 S.E.2d 657, 659 (2016)).
41. “[T]he complaint is to be liberally construed, and the trial court should not
dismiss the complaint unless it appears beyond doubt that [the] plaintiff could prove
no set of facts in support of his claim which would entitle him to relief.” State ex rel.
Cooper v. Ridgeway Brands Mfg., LLC, 362 N.C. 431, 444, 666 S.E.2d 107, 116 (2008)
(quoting Meyer v. Walls, 347 N.C. 97, 111–12, 489 S.E.2d 880, 888 (1997)).
42. Dismissal of a complaint under Rule 12(b)(6) is proper only: “(1) when the
complaint on its face reveals that no law supports [the] claim; (2) when the complaint
reveals on its face the absence of fact sufficient to make a good claim; [or] (3) when
some fact disclosed in the complaint necessarily defeats the . . . claim.” Oates v. JAG,
Inc., 314 N.C. 276, 278, 333 S.E.2d 222, 224 (1985). B. Factual Background
43. The Court does not make findings of fact in ruling on motions to dismiss, “as
such motions do ‘not present the merits, but only [determine] whether the merits may
be reached.’ ” Out of the Box Developers, LLC v. LogicBit Corp., 2012 NCBC LEXIS
55, at *34 (N.C. Super. Ct. Oct. 30, 2012) (quoting Concrete Serv. Corp. v. Inv’rs Grp.,
Inc., 79 N.C. App. 678, 681, 340 S.E.2d 755, 758 (1986)). The Court only recites those
allegations in the Complaint that are relevant to the Court’s determination of the
Motion. See, e.g., Concrete Serv., 79 N.C. App. at 681, 340 S.E.2d at 758.
44. The Court, however, may consider documents to which the Complaint
specifically refers. See Oberlin Capital, L.P. v. Slavin, 147 N.C. App. 52, 60, 554
S.E.2d 840, 847 (2001). Additionally, the Court may “reject allegations [in the
Complaint] that are contradicted by the documents attached, specifically referred to,
or incorporated by reference in the [C]omplaint.” Laster v. Francis, 199 N.C. App.
572, 577, 681 S.E.2d 858, 862 (2009).
45. According to the Complaint, Quidore and Grubbs are citizens and residents
of North Carolina, and Alliance is a limited liability company organized and existing
under the laws of South Carolina, with its principal place of business also in South
Carolina. (Compl. ¶¶ 1–3.) Grubbs is currently at least a 50% owner of, and the
president of, Alliance. (Compl. ¶ 3.)
46. Quidore alleges that he was contacted by Grubbs in 2016, when Quidore was
living and working in California, to discuss the possibility of Quidore becoming
Alliance’s COO. (Compl. ¶ 7.) From late 2016 through early 2017, Quidore and Grubbs negotiated the terms of Quidore’s potential employment with Alliance
through emails, phone calls, texts, and in-person meetings. (Compl. ¶ 8.)
47. Quidore and Grubbs reached an oral agreement in January 2017 (the
“Agreement”). As part of the Agreement, Quidore alleges that the parties agreed
Quidore would receive a 10% equity stake in Alliance (“Equity Stake”), a “4xsalary”
life insurance policy (“Life Insurance”), and certain performance-based bonuses.
Quidore avers that he made clear to Grubbs that these three terms were essential
requirements for him to move to North Carolina to work for Alliance. (Compl. ¶ 9.)
48. On January 9, 2017, Grubbs sent Quidore an offer of employment (the “Offer
Letter”), setting forth Quidore’s proposed salary, benefits, vacation, profit-sharing
bonuses, start date, and housing and car allowances. (Compl. ¶ 10, Ex. A.) Quidore
rejected the Offer Letter because it did not include provisions regarding the Equity
Stake, the Life Insurance, or the performance-based bonuses previously negotiated
as part of the Agreement. (Compl. ¶ 10.)
49. Quidore thereafter asked Grubbs to re-draft the documents to include all
terms agreed upon in the Agreement. (Compl. ¶ 11.) According to Quidore, Grubbs
assured him on January 27, 2017 that the appropriate documents would be drafted
and that he should not “wait on fancy documents – we can draw them up when I get
a breather.” (Compl. ¶ 11, Ex. B.) Quidore also alleges that Grubbs advised that
Quidore had Grubbs’ “unconditional guarantee” that Quidore would receive both the
Equity Stake and the Life Insurance. (Compl. ¶ 12, Ex. B.) 50. Relying on Grubbs’ alleged promises on behalf of Alliance, Quidore accepted
Alliance’s offer and began his employment with Alliance in June 2017. (Compl.
¶¶ 12–14.) In agreeing to take the COO position with Alliance, Quidore agreed to
leave secure employment in California, move to North Carolina permanently with his
family, and receive significantly less compensation in the form of salary and bonuses
than he was receiving in his previous position. (Compl. ¶ 13.)
51. During his employment, Quidore repeatedly asked Grubbs to memorialize
the Agreement’s terms in writing, but, according to Quidore, Grubbs “repeatedly put
[him] off,” straining the relationship between the two. (Compl. ¶¶ 15, 17.) No
documents memorializing the Agreement were ever prepared or executed.
52. On June 17, 2019, Alliance terminated Quidore for what Alliance described
as “performance deficiencies[,]” including work attendance issues and paid-time off
payouts. (Compl. ¶ 27, Ex. C.) Although Quidore acknowledges that he was absent
from work for a few days caring for an ill family member out of state, he otherwise
denies Alliance’s allegations concerning his deficient work attendance and paid-time
off payouts. (Compl. ¶ 29.)
53. Following Quidore’s termination, Grubbs arranged a meeting with Quidore
at a Starbucks in North Carolina to discuss the Equity Stake, the Life Insurance, and
the performance-based bonuses in the Agreement. At the meeting, Grubbs denied
that Alliance owed Quidore any further compensation and asserted for the first time
that the Equity Stake was tied to certain yearly revenue goals, which he said had not
been met. Although Grubbs advised Quidore that Alliance would consider covering certain of Quidore’s post-termination health expenses, Alliance ultimately did not do
so. (Compl. ¶ 30.) Despite Quidore’s repeated demands, Alliance has not paid
Quidore the Equity Stake, the Life Insurance, or the performance-based bonuses
Quidore has alleged are due. (Compl. ¶¶ 30–31.)
C. Analysis
54. Although the parties dispute which state’s law applies to Quidore’s fraud
claim against Alliance—North Carolina, South Carolina, or California—Alliance
argues that Quidore’s claim necessarily fails regardless because Quidore has not
alleged with sufficient particularity a false representation of a pre-existing fact,
(Defs.’ Mem. Supp. Mot. Dismiss 10), a necessary element for fraud under each state’s
law. 5
55. Alliance ignores, however, that in each state, if “at the time the promise is
made the promisor has no intention to perform and the promisee reasonably relies on
the promise to act to his injury, the promise may . . . support an action for fraud.”
Gribble v. Gribble, 25 N.C. App. 366, 369, 213 S.E.2d 376, 378 (1975); see also Union
Flower Mkt., Ltd. v. S. Cal. Flower Mkt., Inc., 76 P.2d 503, 506 (Cal. 1938) (“A promise
made without any intention of performing it constitutes fraud.”); Page v. Pilot Life
Ins. Co., 5 S.E.2d 454, 457 (S.C. 1939) (holding “[w]here one promises to do a certain
5 See, e.g., West v. JPMorgan Chase Bank, N.A., 154 Cal. Rptr. 3d 285, 295 (Cal. Ct. App.
2013) (“The elements of fraud are (1) the defendant made a false representation as to a past or existing material fact[.]”); Cofield v. Griffin, 238 N.C. 377, 379, 78 S.E.2d 131, 133 (1953) (“The essential elements of fraud are these: (1) That defendant made a representation relating to some material past or existing fact[.]”); Jones v. Cooper, 109 S.E.2d 5, 16 (S.C. 1959) (“Deceit or fraudulent representation, in order to be actionable, must relate to existing or past facts[.]”). thing, having at the time no intention of keeping his agreement, it is a fraudulent
misrepresentation of a fact, and actionable as such”).
56. Here, Quidore has pleaded that (i) “[Alliance] . . . made false representations
of material fact to Quidore, that is, if Quidore accepted the position of COO with
[Alliance], then [Alliance] would provide him with” the Equity Stake, the Life
Insurance, and performance-based bonuses, (Compl. ¶ 46); (ii) “[Alliance] knew at the
time that the representation was false[,]” (Compl. ¶ 47); and (iii) “[Alliance] intended
to deceive Quidore because [Alliance] knew Quidore would not take the position of
COO without the provision of the Equity Stake, [Life Insurance], and performance-
based bonuses[,]” (Compl. ¶ 48).
57. Although Quidore did not formulaically recite language that Alliance knew
that it did not intend to pay Quidore the promised benefits at the time the promise
was made, his allegations that Alliance knew that its promise to provide future
benefits was false when that promise was made says exactly the same thing—that
Alliance did not intend to keep its promise of future benefits when it made that
promise. Accordingly, the Court concludes both that Quidore has satisfied his burden
under Rule 9(b) to plead his fraud claim with particularity, see Hardin v. York Mem’l
Park, 221 N.C. App. 317, 329, 730 S.E.2d 768, 778 (2012) (“Rule 9 of the Rules of Civil
Procedure requires that fraud be pled with particularity. . . . ‘[T]he particularity
requirement is met by alleging time, place and content of the fraudulent
representation, identity of the person making the representation and what was
obtained as a result of the fraudulent acts or representations.’ ” (quoting Bob Timberlake Collection, Inc. v. Edwards, 176 N.C. App. 33, 39, 626 S.E.2d 315, 321
(2006))), and that, viewing the Complaint’s allegations in the light most favorable to
Quidore, his fraud claim is sufficiently stated to survive dismissal under Rule
12(b)(6).
IV.
CONCLUSION
58. WHEREFORE, for the reasons set forth above, the Court hereby DENIES
as moot Grubbs’ Motion to Dismiss, DENIES Alliance’s Motion to Dismiss, and
DENIES as moot the Discovery Motion.
SO ORDERED, this 19th day of May, 2020.
/s/ Louis A. Bledsoe, III Louis A. Bledsoe, III Chief Business Court Judge