United States District Court, D. Minnesota
K. Paulose, DLA Piper LLP, Minneapolis, MN; Mandy Chan, DLA
Piper LLP, San Francisco, CA; Miles Cooley, DLA Piper LLP,
Los Angeles, CA; and Sangwon Sung, DLA Piper LLP, East Palo
Alto, CA, for Plaintiff MegaForce.
N. Niemczyk, Stephen M. Ringquist, and Carol R. M. Moss,
Hellmuth & Johnson, PLLC, Edina, MN, for Defendant
William Joseph Johnson.
MEMORANDUM OPINION AND ORDER
C. Tostrud Judge
MegaForce, a concert promoter based in South Korea, commenced
this action on June 19, 2018, alleging that it had entered
into two contracts with Defendant WAV Events and
Entertainment, LLC (“WAV”)-the “Performance
Agreement” and the “Appearance Agreement,
”-for two events MegaForce was producing in South Korea
on January 26 and 27, 2018. See generally Compl.
¶ 19 [ECF No. 1] and Exs. A [ECF No. 1-1] (hereinafter
“Performance Agreement”), and B [ECF No. 1-2]
(hereinafter “Appearance Agreement, ” and with
the Performance Agreement, the “Agreements”).
Under the Agreements, WAV was to have arranged for “the
celebrity appearances of Floyd Mayweather Jr., and musical
artists Lil Wayne and Lil Jamez.” Compl. at 1.
MegaForce alleges that it paid WAV $110, 000 under the
Agreements, and incurred hundreds of thousands of dollars
more in third-party expenses and liabilities as it prepared
for the two events, but WAV never produced the promised
celebrities, giving MegaForce less than two weeks' notice
of the celebrities' non-appearance. Id.
¶¶ 13-14, 25, 35, 63-64. MegaForce sued WAV and its
two co-“managers, ” Defendants Joseph Robert Eng
(“Eng”) and William Joseph Johnson
(“Johnson”), whom MegaForce alleges personally
strung it along for months until virtually the last minute.
MegaForce brings claims for breach of contract and for breach
of the covenant of good faith and fair dealing under each of
the Agreements (Counts I and II for breach of contract and
Counts IV and V for breach of covenant), and for fraud (Count
III), unjust enrichment (Count VI), violation of the
Minnesota Deceptive Trade Practices Act, Minn. Stat. §
325D.44 (Count VII), and civil conspiracy (Count VIII).
See generally Id. ¶ 4, 36-61. MegaForce brings
the breach-of-contract claims and the claims for breach of
covenant of good faith and fair dealing against WAV only; it
brings each of its other claims against all Defendants.
See Id. ¶¶ 66-112.
Eng have not appeared in this action, and MegaForce now moves
for a default judgment on its claims against them. ECF No.
48. Johnson, who has appeared, opposes the default-judgment
motion to the extent a default judgment against WAV and Eng
might somehow prejudice his rights as he defends against this
litigation, and on the additional basis of an arbitration
clause in each of the Agreements, under which (Johnson
contends) all of MegaForce's claims in this action are
subject to mandatory arbitration in New York. See
generally Johnson Opp'n to Pl.'s Mot. for Dflt.
J. [ECF No. 33], Johnson Opp'n to Pl.'s Second Mot.
for Dflt. J. [ECF No. 61] (incorporating by reference ECF No.
33). Johnson moves to compel arbitration and dismiss the
claims against him. ECF No. 41. MegaForce opposes that
motion, arguing primarily that Johnson, as a non-signatory to
either of the Agreements, cannot compel arbitration under
their respective arbitration clauses. MegaForce Opp'n to
Johnson Arb. Mot. (“MegaForce Arb. Opp'n”)
[ECF No. 62]. Johnson's motion to compel MegaForce to
arbitrate its claims against him will be granted, and
MegaForce's motion for default judgment as to the two
other Defendants will be denied without prejudice.
denominated his motion to compel arbitration under
Fed.R.Civ.P. 12(b)(1), but, as MegaForce points out, recent
Eighth Circuit case law makes clear that such motions should
be analyzed under Rule 12(b)(6) or Rule 56, not under Rule
12(b)(1) or Rule 12(b)(3). See Seldin v. Seldin, 879
F.3d 269, 272 (8th Cir. 2018); City of Benkelman, Neb. v.
Baseline Eng'g Corp., 867 F.3d 875, 881 (8th Cir.
2017). Johnson states that he “has no objection to this
motion being deemed a motion to dismiss under either”
Rule 12(b)(6) or Rule 12(b)(1). Johnson Arb. Reply Br. at 4
[ECF No. 70]. In view of the Eighth Circuit's holdings in
Seldin and Benkelman, Johnson's motion
to compel arbitration will be analyzed under Rule 12(b)(6).
reviewing a motion to dismiss for failure to state a claim
under Fed.R.Civ.P. 12(b)(6), a court must accept as true all
of the factual allegations in the complaint and draw all
reasonable inferences in the plaintiff's favor. Gorog
v. Best Buy Co., 760 F.3d 787, 792 (8th Cir. 2014)
(citation omitted). Although the factual allegations need not
be detailed, they must be sufficient to “raise a right
to relief above the speculative level.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citation
omitted). The complaint must “state a claim to relief
that is plausible on its face.” Id. at 570.
courts do not consider matters outside the pleadings in
resolving a Rule 12(b)(6) motion to dismiss, see
Fed. R. Civ. P. 12(d), but the Court may consider exhibits
attached to the complaint and documents that are necessarily
embraced by the pleadings without transforming the motion
into one for summary judgment. Mattes v. ABC Plastics,
Inc., 323 F.3d 695, 697 n.4 (8th Cir. 2003) (citation
omitted). Because the Agreements are attached to, and
embraced by, MegaForce's Complaint, they may be
considered in resolving Johnson's motion.
is not a signatory to any Agreement with MegaForce containing
an arbitration clause; those Agreements were signed by
MegaForce and WAV only. The arbitration clause in each
ARBITRATION: This Agreement shall be
governed and construed in accordance with the laws of the
State of New York. Any claim or dispute arising out of or
relating to this agreement or the breach thereof shall be
settled by arbitration in the State of New York in accordance
with the rules and regulations of the American Arbitration
Association. The parties hereto agree to be bound by the
award in such arbitration and judgment upon ...