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United States ex rel. Dixie Communications Systems, Inc. v. Travelers Casualty and Surety Company of America

United States District Court, S.D. Georgia, Augusta Division

September 23, 2019




         Before the Court are J&J Maintenance, Inc.'s ("Defendant J&J") motion to dismiss (Doc. 6) and Defendant Travelers Casualty and Surety Company of America's ("Defendant Travelers") motion to dismiss (Doc. 10). Both motions argue Plaintiff's Complaint should be dismissed for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6).

         I. BACKGROUND

         The present dispute arises from a project at Fort Gordon involving the construction and renovation of the Dwight D. Eisenhower Army Medical Center's Fisher Army Dental Laboratory (the "Project"). (Compl., Doc. 1, ¶ 10.) Defendant J&J was the general contractor for the Project. (Id. ¶ 11.) Defendant J&J subcontracted with Defendant ICON to perform work on the Project. (Id. ¶ 12.) Defendant ICON subcontracted with Plaintiff to install alarm systems. (Id. ¶¶ 13-14; Pl.'s Opp'n to Def. J& J's Mot. to Dismiss, Doc. 12, Ex. 6.) Defendant Travelers supplied the Project bond to Defendant J&J. (Compl., ¶ 11.)

         Plaintiff completed the work required under its subcontract with Defendant ICON on December 6, 2017. (Id. ¶¶ 15-16.) Afterward, Plaintiff submitted a bill to Defendant ICON in the amount of $66, 187.50, but Defendant ICON has yet to pay the invoice. (Id. ¶¶ 17-18, 22; Pl.'s Opp'n to Def. J& J's Mot. to Dismiss, Ex. 1.) Defendant J&J also refused to pay Plaintiff for the alarm system installation. (Compl., ¶ 19.) Finally, Plaintiff sought payment from Defendant Travelers through Defendant J&J's bond. (Id. ¶ 23.) Defendant Travelers repudiated Plaintiff's request for payment. (Id.; Def. Travelers's Mot. to Dismiss, Doc. 10, Ex. A.)

         The procedural posture of this case is more convoluted than generally expected at this stage of litigation. Plaintiff filed its Complaint asserting four claims against three defendants: (1) breach of contract; (2) quantum meruit; (3) a Miller Act bond claim; and (4) bad faith refusal to settle. (Compl., ¶¶ 24-46.) Defendants J&J and Travelers ("Moving Defendants") moved to dismiss the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), but Defendant ICON Construction, Inc. ("Defendant ICON") offered no response to Plaintiff's Complaint. On February 11, the Clerk entered an entry of default as to Defendant ICON (Doc. 22), and shortly thereafter, Defendant J&J filed a suggestion of bankruptcy indicating Defendant ICON filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the Eastern District of Texas (Docs. 24, 24-1).

         In Moving Defendants' motions to dismiss, both pointed to Plaintiff's failure to allege that it provided proper notice under the Miller Act. (Def. J&J's Mot. to Dismiss, Doc. 6, at 3; Def. Travelers's Mot. to Dismiss, at 5-6.) The Complaint alleges that Plaintiff provided notice to Defendant Travelers more than ninety days after completing work under the subcontract. (See Compl., ¶¶ 16, 21.) Rather than amend its Complaint to allege it provided proper notice, Plaintiff attached several documents to its responses in opposition to the motions to dismiss. (See Pl.'s Opp'n to Def. J& J's Mot. to Dismiss, Exs. 1-9.) Plaintiff then argued Defendants' motions to dismiss should be converted to motions for summary judgment. (See Pl.'s Sur-Reply Opp'n to Def. J&J's Mot. to Dismiss, Doc. 20, at 4.) Based upon Plaintiff's introduction of various documents in its opposition to the present motions to dismiss, the Court addresses multiple issues involving the introduction of extrinsic documents in addition to resolving the present motions.


         Before proceeding to the merits of Moving Defendants' motions to dismiss, the Court must determine whether the extrinsic documents should be considered at this stage.

         A. External Documents

         Generally, when considering a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), the district court is restrained to consider the allegations within the four corners of the complaint. See Speaker v. U.S. Pep't of Health & Human Servs. Ctrs. for Disease Control & Prevention, 623 F.3d 1371, 1379 (11th Cir. 2010) . An exception to the general rule is recognized "if [the extrinsic document] is (1) central to the plaintiff's claim, and (2) its authenticity is not challenged." SFM Holdings, Ltd. v. Banc of Am. Sec, LLC, 600 F.3d 1334, 1337 (11th Cir. 2010); accord Fin. Sec. Assurance, Inc. v. Stephens, Inc., 500 F.3d 1276, 1285 (11th Cir. 2007) (considering document attached to motion to dismiss because "it [was] referred to in the complaint, it [was] central to [the plaintiff's] . . . claim, . . . and neither party challenge[d] its authenticity"). Otherwise, if "matters outside the pleadings are presented to and not excluded by the court, " it "must convert the motion to dismiss into a summary judgment motion." Fed.R.Civ.P. 12(d); SFM Holdings, 600 F.3d at 1339. Thus, the Court identifies the external documents; determines if the Court may consider them in conjunction with the present motions to dismiss; and if not, concludes whether it will consider the documents thereby converting the present motions into summary judgment motions.

         1. Plaintiff's Exhibits 1 and 6 [1]

         Plaintiff's Exhibit 1 is a bill Plaintiff submitted to Defendant ICON. (Pl.'s Opp'n to Def. J& J's Mot. to Dismiss, Ex. 1.) Exhibit 6 appears to be a letter from Plaintiff's counsel to Defendant Travelers, dated July 30, 2018, attaching the subcontract between Plaintiff and Defendant ICON; applications for payment and other billing documents submitted by Plaintiff to Defendant ICON; and Plaintiff's counsel's letters to Defendant J&J and Defendant ICON dated March 28, 2018. (Id. Ex. 6.) These documents meet the exception for consideration.

         Payment for Plaintiff's subcontract work is at the heart of this dispute. Accordingly, documents related to Plaintiff's attempts to seek payment for its work are central to Plaintiff's claims. Similarly, the subcontract serves as the foundation of the present action, especially considering Plaintiff asserts a breach of contract claim. See United States ex rel. TSI Tri-State Painting, LLC v. Fed. Ins. Co., No. CV 216-113, 2016 WL 7385715, at *4 (S.D. Ga. Dec. 20, 2016). Moreover, Plaintiff references both the bill and the subcontract in its Complaint, and Moving Defendants do not dispute the authenticity of these documents. (Compl., ¶¶ 14, 17.) Thus, the Court considers these documents without converting the present motions to dismiss into motions for summary judgment.[2]

         2. Plaintiff's Exhibits 2, 3, 5, 7, 8, and 9 [3]

         Exhibits 2, 3, 5, 7, 8, 9 appear to be communications between Plaintiff and Defendant J&J. (Pl.'s Opp'n to Def. J& J's Mot. to Dismiss, Exs. 2, 3, 5, 7, 8, 9.) These communications are extrinsic documents falling outside the incorporation doctrine. First, the Court concludes these documents are not central to Plaintiff's claim. The Complaint makes no reference to specific communications made with the Defendants other than the alleged March 28, 2018 notice to Defendant Travelers. (See Compl.) Furthermore, the communications with Defendant J&J are not critical to proving Plaintiff's claim. The Complaint does not allege specific notice provided to Defendant J&J. Instead, Plaintiff asserts "Dixie's notice to the bond company could not be provided until March 28, 2018, because Dixie had no way of knowing the identity of the bond company." (Compl., ¶ 21.) Even if the referenced documents support Plaintiff's allegation concerning the surety's identity, the Miller Act expressly requires notice to the contractor, not the bonding company:

A person having a direct contractual relationship with a subcontractor but no contractual relationship, express or implied, with the contractor furnishing the payment bond may bring a civil action on the payment bond on giving written notice to the contractor within [ninety] days from the date on which the person did or performed the last of the labor or furnished or supplied the last of the material for which the claim is made.

40 U.S.C. § 3133(b)(2). Therefore, evidence pertaining to any alleged attempt by Defendant J&J to conceal the identify of its bondholder is not central to a Miller Act claim requiring notice to the contractor. Plaintiff's Complaint fails to allege notice to the contractor, Defendant J&J.

         Second, Defendant Travelers challenged the authenticity of the communications in question. (Def. Travelers's Reply Supp. Mot. to Dismiss, Doc. 23, at 4-5.) In response, Plaintiff argues that the emails can be self-authenticated "[i]f it is not possible to depose the drafter of an email or call him or her at trial." (Pl.'s Sur-Reply Opp'n to Def. Travelers's Mot. to Dismiss, Doc. 26, at 4.) Of course, Plaintiff may not have deposed the email drafters yet because the present action is still in its early stages. Plaintiff does not assert that it will be impossible to authenticate the emails over the course of discovery.

         Furthermore, the rule does not require the Court to determine authenticity; instead, it only requires a challenge to the authenticity.[4] Because alleged concealment of the surety's identity is not central to a Miller Act claim, Plaintiff does not allege notice to Defendant J&J, and Defendant Travelers challenged the authenticity of ...

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