United States District Court, D. Massachusetts
WILLIAM F. SOLFISBURG, Plaintiff,
GLENCO, INC., DAVID BILLINGSLY, P.E., PFS CORPORATION D/B/A PFS TECO, SET CONNECTORS, INC., APEX HOMES OF PA, LLC, and APEX HOMES, INC., Defendants.
MEMORANDUM & ORDER
Talwani, United States District Judge.
the court is Defendant Apex Homes of PA, LLC's
(“Apex LLC”) Motion to Dismiss
Plaintiff's Second Amended Complaint [#45]. Apex LLC
argues that the Second Amended Complaint [#43]
(“Complaint”) must be dismissed in whole or in
part on the grounds: (1) that the Complaint fails to state a
claim for successor liability; (2) that paragraph three of
the Complaint violates the Federal Rules of Civil
Procedure's pleading requirements; (3) that the Complaint
fails to join a necessary and indispensable party; and (4)
that Plaintiff's claims, with the exception of the claim
for breach of warranty, must be dismissed because they are
barred by order of the United States Bankruptcy Court for the
Middle District of Pennsylvania, the Massachusetts statute of
limitations, the Massachusetts “gist of the
action” doctrine, and the Massachusetts economic loss
doctrine. The court finds that dismissal is not appropriate
on any of the grounds presented by Defendant. The motion is,
action arises out of Plaintiff William F. Solfisburg's
purchase and installation of a modular home. Plaintiff
alleges that he contracted with a general contractor,
Sandcastle Group, in August 2012 to build the home. Compl.
¶ 22. Sandcastle hired various other entities to design,
install and perform work on the home. Compl. ¶¶
17-21. Defendant Apex Homes, Inc. (“Apex Inc.”)
contracted to build the modular units. Compl. ¶ 25.
State Building Code (the “Special Regulations”)
require that entities can sell modular homes or building
components in the Commonwealth only if they have been
approved and certified under these regulations which are
administered by the Massachusetts Board of Building
Regulations and Standards (“BBRS”). Compl.
¶¶ 11-12. At the time Apex Inc. contracted to build
the modular units, it was in Chapter 11 bankruptcy
proceedings in the United States Bankruptcy Court for the
Middle District of Pennsylvania (the “bankruptcy
court”). Def.'s Mem., Exh. E [#46-5]. Apex Inc. did
not notify the BBRS that of the bankruptcy proceeding or of
changes in officers or ownership as a result of the
bankruptcy. Compl. ¶ 25.
modular unit had structural defects and did not meet the
Special Regulations' standards. Compl. ¶¶ 28,
31. Nonetheless, on March 19, 2013, Apex Inc. provided
Plaintiff with a signed Certificate of Completion that
misrepresented the work done by Apex Inc. Compl. ¶¶
30-31. The units were delivered to the project site in March
2013. Compl. ¶ 34.
2014, Apex Inc.'s assets, including customer lists, the
name “Apex Homes, ” rights to Apex Inc.'s
promotional material, machinery, equipment, inventory,
goodwill, licenses, permits, approvals, and intellectual
property were purchased by H. Lynn Kuhns, Apex Inc.'s
president, on behalf of Ridgeview Modular Housing Group
(“Ridgeview”), a Pennsylvania Limited
Partnership. See Def.'s Mem., Exh. F ¶ 1.1
[#46-6] (“Asset Purchase Agreement”). The Asset
Purchase Agreement provided further that the “Purchaser
shall assume responsibility for all obligations of [Apex
Inc.] relating to any warranty extended to [Apex Inc.'s]
customers and their assignees in existence as of the Closing
Date and shall indemnify and hold [Apex Inc.] harmless from
any loss, judgment, liability, claim, or cost, whether
contingent, liquidated or unliquidated with respect to such
assumed warranty.” Id ¶ 1.3(d). After
providing notice to creditors in the Chapter 11 case, the
bankruptcy court on July 18, 2014, approved the Asset
Purchase Agreement, and included the following provision in
its Order Approving Sale (“Sale Order”):
[Apex Inc.'s] interest in the Purchase Assets is not
subject to any known judgments, liens, encumbrances and other
claims (collectively, the “Liens and Claims”)
that have not been avoided or are avoidable in whole, or in
part, as part of this Chapter 11 case. All persons or
entities holding any Liens and Claims in, to or against [Apex
Inc.] or the Purchased Assets of any kind or nature
whatsoever shall be, and hereby are, forever barred,
estopped, and permanently enjoined from asserting,
prosecuting, or otherwise pursuing any such Liens and Claims
against [the purchaser or its successors].
Def.'s Mem., Exh. G ¶ 5 [#46-7].
days later, on July 23, 2014, H. Lynn Kuhns created Apex LLC.
See Def.'s Mem., Exh. D [#46-4]. Ridgeview then
sold the assets purchased from Apex Inc. to Apex LLC.
See Request for Stay 2 n.1 [#17]. Mr. Kuhns now
operates Apex LLC. Compl. ¶ 3(d). Although Apex LLC was
not created until 2014, its website traces its business back
to 1989, the year Apex Inc. was founded. Compl. ¶ 3(c).
around February 2015, the interior of Mr. Solfisburg's
home suffered significant damage after water penetrated the
roof. Compl. ¶ 38. Plaintiff retained an engineer to
perform an inspection of home and prepare a report
documenting discrepancies between the as-built conditions and
the specified designs as well as any other sub-standard
condition at the home. Id. This report identified
numerous defects, including structural and safety issues.
Id.; Compl., Exh. A, 5-63 [#43-1].
LLC subsequently stated to the BBRS that Apex LLC was
responsible for the home manufactured by Apex Inc. Compl.
August 2018, when the Complaint was filed, a permanent
certificate of occupancy for the home has not issued and
Plaintiff continues to be unable to live in the home. Compl.
initiated this action on February 9, 2018, and filed his
Second Amended Complaint [#43] on August 29, 2018.
As detailed further below, Plaintiff alleges that Defendant
Apex LLC is the successor to, and responsible and liable for
the conduct of, Apex Inc. Although Apex Inc. reportedly has
been served with the Summons and operative Complaint, see
Affidavit of Service [#52], and despite the court
extending the deadline for Apex Inc.'s Answer to August
15, 2019, see Elec. Order [#79] adopting
Proposed Second Amended Scheduling Order [#78], Apex
Inc. has not answered. Apex LLC responded with the pending
Motion to Dismiss [#45] which Plaintiff opposed.
See Pl's Opp'n [#64].
survive a motion to dismiss, the well-pleaded facts in a
plaintiff's complaint must “state a claim to relief
that is plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). As the First Circuit
has explained, in reviewing a complaint under a Fed.R.Civ.P.
12 motion to dismiss, the court “must distinguish the
complaint's factual allegations (which must be accepted
as true) from its conclusory legal allegations (which need
not be credited).” Cardigan Mountain Sch. v. New
Hampshire Ins. Co., 787 F.3d 82, 84 (1st Cir. 2015)
(internal citations omitted). The plausible factual
allegations, taken as true, must ultimately be able to
support the legal conclusion that underlies each claim for
relief. Id Although the court ordinarily only
considers the complaint's plausible factual allegations
on a motion to dismiss, the First Circuit has recognized a
narrow exception to this rule for “documents the
authenticity of which are not disputed by the parties; for
official public records; for documents central to
plaintiffs' claim; or for documents sufficiently referred
to in the complaint.” Foley v. Wells Fargo Bank,
N.A., 772 F.3d 63, 74 (1st Cir. 2014). The court now
addresses each of Defendant's assertions for why
dismissal is proper under these standards.
Statute of Limitations
argues that dismissal is proper for all but the breach of
warranty claim under Massachusetts' three-year statute of
limitations for tort claims and four-year statute of
limitations for the ch. 93A claim. Def's Mem. 16-19
[#46]. Defendant states that the modular units were delivered
to Sandcastle by March 2013 and had obvious defects at that
time. Id at 17, 18. Thus, Defendant argues, by March
2013, Plaintiff ...