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Red Lion Hotels Franchising Inc v. First Capital Real Estate Investments LLC

United States District Court, E.D. Washington

May 22, 2018

RED LION HOTELS FRANCHISING, INC., Plaintiff,
v.
FIRST CAPITAL REAL ESTATE INVESTMENTS, LLC, a California limited liability company; MR. SUNEET SINGAL and MRS. MAJIQUE LADNIER, individually and as the marital community comprised thereof, Defendants.

          ORDER STRIKING DEFENDANTS' FIRST, SECOND, FOURTH, AND FIFTH AFFIRMATIVE DEFENSES

          ROSANNA MALOUF PETERSON UNITED STATES DISTRICT JUDGE.

         BEFORE THE COURT is Plaintiff's Partial Motion to Dismiss Defendants' Affirmative Defenses, ECF No. 20. Plaintiff moves to dismiss Defendants' first, second, fourth, and fifth affirmative defenses. See ECF No. 20. The Court has reviewed the pleadings and the record, and is fully informed.

         BACKGROUND

         Plaintiff Red Lion Hotels Franchising, Inc., brings this breach of contract suit against Defendants to recover amounts under three contracts of guaranty for payments allegedly owed by three entities under franchise license agreements (“FLAs”) made with Plaintiff. ECF No. 1. Plaintiff alleges that the three franchise entities in question are in default of amounts owed to Plaintiff under their FLAs. Id. Plaintiff alleges that Defendant First Capital Real Estate Investments, LLC, is the managing member of the three franchise entities. Id., ¶ 3.3. Plaintiff further alleges that the named Defendants, as the principals behind the franchise entities, signed the guaranty contracts that Plaintiff alleges have been breached. Id., ¶ 3.5.

         The Court has subject matter jurisdiction over this matter pursuant 28 U.S.C. § 1332 based on the diversity of the parties and the amount in controversy. Plaintiff is a corporation licensed in Washington. ECF No. 1, ¶ 1.1. Defendant First Capital Real Estate Investments, LLC, is a foreign limited liability company. Id., ¶ 1.2. Defendants Suneet Singal and Majique Ladnier reside in California. Id., ¶ 1.3. The amount in controversy is $1, 265, 220.53, which exceeds the statutory requirement of $75, 000. Id., ¶¶ 4.6, 4.12, 4.18.

         DISCUSSION

         In its motion to dismiss several of Defendants' affirmative defenses, Plaintiff argues that four of the five asserted affirmatives defenses are not legally sustainable. ECF No. 20 at 5. Plaintiff brings this motion pursuant to Federal Rule of Civil Procedure 12(c), a motion for judgment on the pleadings. See Id. at 9.

         “The Court notes that a plaintiff's motion for judgment on the pleadings shall not be granted unless all of the defenses raised in the answer are legally insufficient.” Burns v. Consol. Amusement Co., 182 F.R.D. 609, 611 (D. Haw. 1998) (emphasis in original) (citing Fed.R.Civ.P. 12(c)). Instead, “if one or more of the defenses are viable, plaintiff's motion should be brought as a motion to strike within [21] days after service of the answer.” Id. (citing Fed.R.Civ.P. 12(f)). The court may also act on its own to strike from a pleading an insufficient defense. Fed.R.Civ.P. 12(f).

         Plaintiff does not argue that all of Defendants' affirmative defenses are insufficient as a matter of law. Therefore, the Court will construe Plaintiff's motion as a motion to strike Defendants' first, second, fourth, and fifth affirmative defenses pursuant to Fed.R.Civ.P. 12(f).

         Defendants filed their answer on May 19, 2017. See ECF No. 9. Plaintiff filed its motion for dismissal of Defendants' affirmative defenses, which the Court construes as a motion to strike, on February 20, 2018. See ECF No. 20. To comply with Rule 12(f), Plaintiff needed to file its motion by June 9, 2017. See Fed. R. Civ. P. 12(f). Plaintiff delayed eight months in filing its motion.

         However, Defendants also did not respond timely to Plaintiff's motion. According to LR 7.1(b), counsel in a civil case has 21 days after the filing of a dispositive motion to file a response. “The failure to comply with the requirements of LR 7.1(a) or (b) may be deemed consent to the entry of an Order adverse to the party who violates these rules.” LR 7.1(d).

         Although both parties have failed to follow the relevant procedural rules, Fed.R.Civ.P. 12(f) authorizes the Court to act on its own to strike from a pleading an insufficient defense.

         Legal Standard for Striking Affirmative Defense

         Federal Rule of Civil Procedure 12(f) provides that “[t]he court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” A defense may include both denials and affirmative defenses. Defense, Black's Law Dictionary (10th ed. 2014); see also Fed. R. Civ. P. 8. A responding party must make general or specific denials to the substance of the allegations asserted against it by an opposing party. Fed.R.Civ.P. 8(b). A responding party also “must affirmatively state any avoidance or affirmative defense.” Fed.R.Civ.P. 8(c).

         Federal Rule of Civil Procedure 8(c) defines whether the procedural pleading of an affirmative defense is “sufficient.” Wyshak v. City Nat'l Bank, 607 F.2d 824, 827 (9th Cir. 1979). Rule 8(b) requires a party responding to a pleading to “state in short and plain terms its defenses to each claim asserted against it.” Fed.R.Civ.P. 8(b)(1)(A). Rule 8(c) states that “a party must affirmatively state any avoidance or affirmative defense, ” including such defenses as laches and violations of a statute of limitations. Fed.R.Civ.P. 8(c). “Of course, affirmative defenses, like all pleadings, must also satisfy Rule 11.” In re Washington Mut., Inc. Secs., Derivative & ERISA Litig., 08-MD-1919 MJP, 2011 WL 1158387, at *1 (W.D. Wash. Mar. 25, 2011) (striking certain affirmative defenses). Federal Rule of Civil Procedure 11 requires all pleadings to be ...


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