United States District Court, D. Massachusetts
REPORT AND RECOMMENDATION ON DEFENDANT'S MOTION
TO DISMISS (DKT. NO. 6)
L. CABELL, U.S.M.J.
Light Source (“BLS”), a representative of
commercial lighting products, has brought a seven-count
action against Axis Lighting (“Axis”), a
manufacturer of commercial lighting products, to recover
unpaid commissions BLS contends it earned through marketing,
promoting and selling Axis's products. Axis moves to
dismiss five of the seven counts for failure to state a
claim. For the reasons discussed below, I recommend that the
motion to dismiss be granted in part and denied in part.
the facts in the complaint as true, BLS is a sales
representative for manufacturers of commercial lighting
products, including Axis, whose products are sold across the
United States. (Compl. ¶¶ 4-5). On April 5, 2007,
BLS and Axis entered into a Sales Representative Agreement
(the “Agreement”) pursuant to which BLS agreed to
represent, promote, and market Axis products in the
“Boston [a]rea, including eastern Massachusetts,
Worcester County, and the state of Rhode Island.”
(Id. at ¶ 6). In exchange, Axis agreed to pay
BLS a certain commission on the sale of any Axis products.
(Id. at ¶¶ 6-7). Both parties reserved the
right to terminate the Agreement with 30-days prior notice
but BLS would be entitled in such a case to receive
commissions owed “for a period of three months for any
order or contract that has been registered with [Axis] within
30 days or there is sufficient evidence to prove that the
agent has worked on the order or contract.” (Dkt. No.
consummating the Agreement, BLS actively marketed and
promoted Axis's products to help achieve brand
recognition in the designated territory. BLS also increased
sales of Axis products and introduced BLS customers to Axis
management to further expand Axis's market share. (Compl.
¶¶ 8-10). Then, in early 2016, Axis instituted a
“sales incentive program” under which it agreed
to pay BLS an additional “incentive bonus” if BLS
achieved certain sales benchmarks in a calendar year.
(Id. at ¶ 11).
summer of 2016, BLS “had many orders pending, was on
the brink of making a number of substantial sales, had made
significant headway into finalizing the largest specification
for an order of Axis products it had ever created, ”
and “was well on its way to earning a bonus”
under the sales incentive program. (Id. at ¶
12). On September 6, 2016, however, Axis notified BLS that it
was terminating the Agreement. Axis stated that the
termination was due to a “territorial
reorganization” but BLS contends that Axis terminated
the Agreement so that it could avoid having to pay BLS
commissions and incentive bonuses that were due and/or that
were likely to be due at the end of the calendar year.
(Id. at ¶ 13-14).
The Plaintiff's Claims and the Motion to
complaint advances seven counts. Count I alleges a breach of
contract; Count II alleges a breach of the implied covenant
of good faith and fair dealing; Count III alleges a violation
of M.G.L. c. 104, §§ 7-9, which imposes on certain
entities a statutory obligation to pay timely commissions and
penalties for failing to do so; Count IV alleges a violation
of M.G.L. c. 93A; Count V alleges unjust enrichment; Count VI
alleges a claim for quantum meruit; and Count VII asserts a
claim for an accounting. Axis moves to dismiss Counts II and
IV-VII for failure to state a claim. (Dkt. No. 6). BLS
opposes the motion. (Dkt. No. 14).
the Federal Rues of Civil Procedure, a complaint must contain
a “short and plain statement of the claim showing that
the pleader is entitled to relief.” Fed.R.Civ.P.
8(a)(2). To survive a motion to dismiss, the plaintiff must
provide “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). The“[f]actual
allegations must be enough to raise a right to relief above
the speculative level . . . on the assumption that all the
allegations in the complaint are true (even if doubtful in
fact).” Id. at 555 (internal citations
omitted). “The plausibility standard is not akin to a
probability requirement, but it asks for more than a sheer
possibility that a defendant has acted unlawfully, ”
and is met where “the plaintiff pleads factual content
that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(quoting Twombly, 550 U.S. At 556).
deciding a motion to dismiss under Rule 12(b)(6), the court
must “accept as true all well-pleaded facts set forth
in the complaint and draw all reasonable inferences therefrom
in the pleader's favor.” Haley v. City of
Boston, 657 F.3d 39, 46 (1st Cir. 2011) (quoting
Artuso v. Vertex Pharm, Inc., 637 F.3d 1, 5 (1st Cir.
2011)). However, the Court is “not bound to accept as
true a legal conclusion couched as a factual
allegation.” Iqbal, 556 U.S. at 678
(quoting Twombly, 550 U.S. at 555). Simply put, the
Court should assume that well-pleaded facts are genuine and
then determine whether such facts state a plausible claim for
relief. Iqbal, 556 U.S. at 679.
Count II States a Valid Claim for Breach of the Implied