Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Burgess v. Vfinity LLC

United States District Court, M.D. Florida, Fort Myers Division

May 26, 2017

KEN L. BURGESS, an individual, SANDI BURGESS, an individual, and LIGHTSHIP ENTERPRISE, a Wyoming corporation, Plaintiffs,
v.
VFINITY LLC, a Florida limited liability company, VOYAGER HEALTH TECHNOLOGIES CORP., ALEX ELIASHEVSKY, an individual, and MURRAY POLISCHUK, an individual, Defendants.

          OPINION AND ORDER

          John E. Steele, Judge

         This matter comes before the Court on Defendants Vfinity LLC and Alex Eliashevsky's Motions to Dismiss Plaintiffs' Amended Complaint with Prejudice (Docs. ##65, 66) filed on March 27 and 28, 2017, in which defendant Murray Polischuk joined (Docs. ##71, 73). Plaintiff filed a Memorandum in Opposition (Doc. #77) on May 1, 2017. For the reasons set forth below, the motions are granted without prejudice since the Amended Complaint is an impermissible shotgun pleading, but denied to the extent defendants argue for dismissal based on lack of subject-matter jurisdiction.

         On November 18, 2015, plaintiffs filed a thirteen-count Complaint in the United States District Court for the Central District of Utah (Doc. #1), alleging various state law claims based on diversity jurisdiction. The case was transferred to the Middle District of Florida, Fort Myers Division, on January 11, 2017. (Doc. #42.) Prior to transfer the Utah District Court had entered an Order to Show Cause (Doc. #40), finding that plaintiffs had failed to plead domicile, and set forth the areas where the Complaint was lacking in this regard. Plaintiffs filed a response in the District of Utah (Doc. #41) on January 5, 2017, but the record does not show that the Utah District Court was satisfied with or even addressed subject-matter jurisdiction prior to transfer. Therefore, on March 7, 2017, this Court dismissed the Complaint for lack of subject-matter jurisdiction without prejudice to filing an Amended Complaint. (Doc. #63.) The Court also noted in that Order that the Complaint was a shotgun pleading and directed plaintiffs to correct this deficiency in the Amended Complaint. (Id. at 6.) Plaintiffs filed a thirteen-count Amended Complaint[1] (Doc. #64) on March 14, 2017.

         Defendants Vfinity LLC, Alex Eliashevsky, and Murray Polischuk move to dismiss[2], arguing that the Amended Complaint still fails for lack of subject-matter jurisdiction, fails to state a claim, and is a shotgun pleading.

         I.

         As alleged in plaintiff's Amended Complaint (Doc. #64), defendant Voyager Health Technologies Corp. (Voyager) is a direct selling, multi-level marketing company engaged in the business of marketing nutritional, health, and personal care products to consumers through a network of independent associates. (Id. at ¶ 11.) Voyager became Vfinity on or about March 17, 2015. (Id. at ¶ 5.) Eliashevsky and Polischuk are members of Vfinity - Eliashevsky served as Vfinity's manager and majority member and Polischuk bore responsibility for the decisions of Vfinity. (Id. at ¶¶ 7, 8, 16.)

         During the formation of Voyager, beginning around August 2010, plaintiffs entered into a written agreement with Voyager, referred to in the Amended Complaint as the “Initial Agreement, ” whereby plaintiffs agreed to market Voyager's products.[3] (Doc. #64, ¶ 12.) At all material times, plaintiffs did business individually and/or as Lightship Enterprise, Inc. (Id. at ¶ 3.) The Initial Agreement entitled plaintiffs to certain guaranteed compensation, bonuses, and other benefits during the development phase and until Voyager launched. (Id.) Pursuant to the Initial Agreement, plaintiffs provided valuable business development and consulting services and made efforts to build plaintiffs' “downline”[4] sales organization to market Voyager's products and services, benefitting Voyager and the individual defendants. (Id. at ¶ 13.) At Voyager's request and in reliance on the Initial Agreement, plaintiffs served in various consulting, administrative, and management positions with Voyager. (Id. at ¶ 14.)

         Following Voyager's founding, Voyager began experiencing problems. As a result, Voyager failed and refused to pay compensation to plaintiffs, including bonuses, commissions, overrides, and unpaid expenses, in breach of the Initial Agreement. (Doc. #64, ¶ 15.) In or about late 2013, without notice, Voyager transferred substantially all its assets to Vfinity in an effort to hinder, delay, or defraud it creditors and to distance itself from its troubled past, including its obligations to plaintiffs. (Id. at ¶ 16.)

         Shortly after the formation of Vfinity, Eliashevsky met with plaintiffs regarding Vfinity's unpaid obligations due to plaintiffs. (Doc. #64, ¶ 18.) In order to induce plaintiffs to continue providing services to Vfinity, including the preservation of plaintiffs' downline sales organization, Eliashevsky represented and personally promised that he would guarantee Vfinity's obligations to plaintiffs should Vfinity be unable to pay them. (Id.) In reliance on these promises, plaintiffs continued to work for Vfinity and provide business development services, consultation, and marketing of Vfinity's products. (Id. at ¶ 19.) The business development services provided by plaintiffs constitute proprietary and confidential business and other trade secret information, which plaintiffs agreed to allow defendants to use with a reasonable expectation of confidentiality and compensation. (Id. at ¶¶ 23, 24.) Defendants have failed and/or refused to return the trade secrets to plaintiffs, which defendants continue to benefit from. (Id. at ¶¶ 20, 21.)

         In or about early 2014, plaintiffs were terminated by defendants without cause so that defendants could take plaintiffs' trade secrets and downline sales organization without paying plaintiffs for the value of the trade secrets and without paying the compensation and other benefits due to plaintiffs. (Doc. #64, ¶ 24.)

         In or around January 2015, Vfinity developed a new Independent Associate Agreement, referred to in the Amended Complaint as the “Second Agreement.” (Doc. #64, ¶ 27.) Vfinity requested that plaintiffs sign the Second Agreement, which plaintiffs initially refused, contending that Vfinity remained obligated to pay them prior outstanding compensation and benefits. (Id. at ¶ 28.) Vfinity threatened that unless plaintiffs sign the Second Agreement, Vfinity would withhold any prior compensation and benefits, as well as any future compensation, and prohibit plaintiffs from communicating with their downline sales organization. (Id. at ¶ 29.) On January 6, 2015, plaintiffs executed the Second Agreement under economic duress.[5] (Id. at ¶ 30.) Vfinity has continued to fail and refuse to pay plaintiffs compensation and benefits owed under the Initial and Second Agreements. (Id. at ¶ 31.)

         On or about September 9, 2015, Vfinity sent plaintiffs a Notice of Termination, falsely claiming that plaintiffs breached the Second Agreement by raiding and cross-solicitation of products. (Doc. #64, ¶ 32.)

         II.

         A. ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.