United States District Court, S.D. Florida
OMNIBUS ORDER ON PLAINTIFF'S MOTION TO DISMISS
COUNTERCLAIM AND MOTION FOR SUMMARY JUDGMENT
N. Scola, Jr. United States District Judge.
matter is before the Court upon the Plaintiff Eddy Leal,
P.A.'s motion to dismiss counterclaim (ECF No. 36) and
motion for summary judgment (ECF No. 34.) The
Defendants/Counter-Plaintiffs did not file responses to
either of the Plaintiff's motions despite the Court's
granting their request for additional time in which to do so.
After reviewing the motions, the record in this case, and the
applicable law, the Court grants both
Background and Relevant Facts
case, Leal asserts that the Defendants knowingly filed false
Internal Revenue Service Forms 1099, thereby falsely
reporting income on behalf of the Plaintiff, in violation of
26 U.S.C. § 7434. (Am. Compl., ECF No. 12.) The
Defendants and non-party Orlando Benitez, Jr.
(“Benitez”) have been in active litigation for
more than seven years. (Pl.'s Statement of Material Facts
(“SOMF”), ¶ 4.) The Plaintiff represented
Benitez for approximately two years. (Id. ¶ 5.)
As part of that litigation, the Defendants entered into
agreed orders in state court proceedings in which funds would
be placed in the Plaintiff's trust account pending
further order from the state court. (Id.
¶¶ 6-11.) Pursuant to those agreed orders, the
Defendants wrote monthly checks, made payable to “Eddy
Leal, P.A. Trust Account” to be deposited and held in
escrow in the Plaintiff's trust account. (Id.
¶¶ 13, 18.)
the fact that the agreed orders required that the funds be
placed in the Plaintiff's trust account and thereby held
in escrow, both of the Defendants issued a Form 1099-Misc to
the Plaintiff for the 2015 taxable year. (Id. ¶
14, 19.) Defendant Jarrette Bay Investment Corporation issued
a Form 1099-Misc to the Plaintiff for $19, 400.20 for the
2015 taxable year. (Id. ¶ 14.) Defendant Bimini
Development of Village West Corporation issued a Form
1099-Misc to the Plaintiff for $8, 000 for the 2015 taxable
year. (Id. ¶ 19.) The Plaintiff contacted the
Defendants to correct these improperly issued Forms 1099 but
the Defendants never responded to the Plaintiff's
attempts to resolve the issue. (Id. ¶¶
16-17, 21-22.) Both of the Defendants filed the Forms 1099
with the Internal Revenue Service (“IRS”).
(Id. ¶¶ 15, 20.) The Plaintiff contends
that the Defendants “filed the fraudulent [Forms 1099]
with the IRS with the purpose of either defrauding the IRS or
harassing [the] Plaintiff.” (Id.) Moreover,
following a hearing, the state court entered an order
indicating its concern with respect to the characterization
of the income reported on the 1099 issued to the Plaintiff,
and requiring the Defendant Jarrette Bay to send a letter to
its accountant indicating this concern and stating that the
form should be corrected. (Id. ¶ 16.) Defendant
Bimini Development conceded at a similar court hearing that
the 1099 issued was in error and that it would be corrected
within short order. (Id. ¶ 21.) Neither
Defendant corrected the 1099s. (Id. ¶ 17, 22.)
Based upon the undisputed facts, the Plaintiff seeks summary
judgment on its claims for fraudulent filing of information
returns against the Defendants.
Defendants have asserted a counterclaim against the Plaintiff
for fraud and misrepresentation, alleging that Plaintiff and
Benitez entered into an agreement for representation that
Plaintiff has masked by misrepresenting its attorneys'
fees and costs, specifically, with respect to this case.
(Ans. ¶¶ 5-10, 13.) The Plaintiff seeks dismissal
of the counterclaim for lack of standing and failure to state
Motion to Dismiss Standard
motion to dismiss a counterclaim pursuant to Federal Rule of
Civil Procedure 12(b)(6) is evaluated in the same manner as a
motion to dismiss a complaint.” Bank of Am., N.A.
v. GREC Homes IX, LLC, No. 13-21718-CIV, 2014 WL 351962,
at *3-4 (S.D. Fla. Jan. 23, 2014) (Altonaga, J.) (citation
omitted). When considering a motion to dismiss under Federal
Rule of Civil Procedure 12(b)(6), the Court must accept all
of the complaint's allegations as true, construing them
in the light most favorable to the plaintiff. Pielage v.
McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008). A
pleading need only contain “a short and plain statement
of the claim showing that the pleader is entitled to
relief.” Fed.R.Civ.P. 8(a)(2). “[T]he pleading
standard Rule 8 announces does not require detailed factual
allegations, but it demands more than an unadorned,
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(quotation omitted). A plaintiff must articulate
“enough facts to state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007).
cause of action sounds in fraud, however, Federal Rule of
Civil Procedure 9(b) must be satisfied in addition to the
more relaxed standard of Rule 8. Under Rule 9(b), “a
party must state with particularity the circumstances
constituting fraud or mistake, ” although
“conditions of a person's mind, ” such as
malice, intent, and knowledge, may be alleged generally.
Fed.R.Civ.P. 9(b). “The ‘particularity'
requirement serves an important purpose in fraud actions by
alerting defendants to the precise misconduct with which they
are charged and protecting defendants against spurious
charges of immoral and fraudulent behavior.” W.
Coast Roofing & Waterproofing, Inc. v. Johns Manville,
Inc., 287 F. App'x 81, 86 (11th Cir. 2008)
(citations omitted). Thus, the Rule's
“particularity” requirement is not satisfied by
“conclusory allegations that certain statements were
fraudulent; it requires that a complaint plead facts giving
rise to an inference of fraud.” Id. To meet
this standard, the complaint needs to identify the precise
statements, documents, or misrepresentations made; the time
and place of, and the persons responsible for, the alleged
statements; the content and manner in which the statements
misled the plaintiff; and what the defendant gained through
the alleged fraud. Id.
Summary Judgment Standard
judgment is proper if following discovery, the pleadings,
depositions, answers to interrogatories, affidavits and
admissions on file show that there is no genuine issue as to
any material fact and that the moving party is entitled to
judgment as a matter of law. Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986); Fed.R.Civ.P. 56.
“An issue of fact is ‘material' if, under the
applicable substantive law, it might affect the outcome of
the case.” Hickson Corp. v. N. Crossarm Co.,
357 F.3d 1256, 1259-60 (11th Cir. 2004). “An issue of
fact is ‘genuine' if the record taken as a whole
could lead a rational trier of fact to find for the nonmoving
party.” Id. at 1260.
evidence and factual inferences reasonably drawn from the
evidence must be viewed in the light most favorable to the
nonmoving party. Adickes v. S.H. Kress & Co.,
398 U.S. 144, 157 (1970); Jackson v. BellSouth
Telecomms., 372 F.3d 1250, 1280 (11th Cir. 2004).
“If more than one inference could be construed from the
facts by a reasonable fact finder, and that inference
introduces a genuine issue of material fact, then the
district court should not grant summary judgment.”
Bannum, Inc. v. City of Fort Lauderdale, 901 F.2d
989, 996 (11th Cir. 1990).
party properly makes a summary judgment motion by
demonstrating the absence of a genuine issue of material
fact, whether or not accompanied by affidavits, the nonmoving
party must go beyond the pleadings through the use of
affidavits, depositions, answers to interrogatories and
admissions on file, and designate specific facts showing that
there is a genuine issue for trial. Celotex, 477
U.S. at 323-24. The nonmovant's evidence must be
significantly probative to support the claims. Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 249
(1986). The Court will not weigh the evidence or make
findings of fact. Id. at 249; Morrison v. Amway
Corp., 323 F.3d 920, ...