Crmsuite Corp. v. Gen. Motors Co.

CRMSUITE CORPORATION, Plaintiff, v. GENERAL MOTORS COMPANY; GENERAL MOTORS, LLC;AQUENT, LLC; and AQUENT, INC. Defendants.

Case No. 8: 20-cv-762-T-02-WFJ-AAS

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA TAMPA DIVISION

October 5, 2020

ORDER GRANTING DEFENDANTS' MOTIONS TO DISMISS AND DENYING DEFENDANT GM'S MOTION TO STRIKE

This cause comes before the Court on Defendant General Motors Company, General Motors, LLC's (collectively, "GM"), Aquent, LLC, and Aquent, Inc.'s (collectively, "Aquent") Motions to Dismiss, Dkts. 41, 42, Plaintiff's Amended Complaint, Dkt. 38, and Defendant GM's Motion to Strike certain allegations in the Amended Complaint, Dkt. 43. Plaintiff has responded to all Defendants' motions. Dkts. 46, 47. With the benefit of full briefing, the Court grants the Motions to Dismiss without prejudice, and denies GM's Motion to Strike.¹

I. BACKGROUND

A. Nature of the Dispute

This case arises from a failed business relationship. Plaintiff brings this lawsuit based on alleged actionable conduct Defendants engaged in while administering GM's Vendor Management Program. The Amended Complaint asserts five counts: (I) violation of the Florida Deceptive and Unfair Trade Practices Act ("FDUTPA" or "the Act"); (II) tortious interference with a business relationship; (III) tortious interference with a contractual relationship; (IV) equitable estoppel; and (V) promissory estoppel. Plaintiff seeks declaratory and injunctive relief, damages, costs, and attorney's fees. Dkt. 38 ¶¶ 138, 144.

B. Factual Allegations

At this stage, the Court recites and considers the facts as alleged by Plaintiff. Randall v. Scott, 610 F.3d 701, 705 (11th Cir. 2010). Plaintiff CRMSuite is a Sarasota-based corporation that provides customer relationship management (CRM) software to auto dealerships across Florida. Dkt. 38 ¶ 9. Plaintiff produces an eponymous CRM software product that allows its dealer clients to manage customer sales leads, including those generated through the dealers' websites. Id. Plaintiff's customers are mainly mutli-brand dealerships, and many sell GM-manufactured vehicles. Id. ¶¶ 9-10.

GM requires all dealerships that sell its vehicles to purchase CRM products from GM-approved vendors. Dkt. 38 ¶ 26. To become an approved vendor, a software provider must meet the requirements GM imposes under its dealer vendor management program. Id. One of the most important requirements is that vendors must integrate a connector server between GM's computer network and the CRM software product, called a pipeline. Id. ¶¶ 30-31. Once a vendor establishes a pipeline and meets the other program requirements, the vendor may list its CRM products on GM's dealer vendor advisor website where dealers browse and shop from the various GM-approved CRM products. Id. ¶ 29. Approved vendors must also pay a regular fee to GM to list their products on the site. Id. ¶ 32.

Defendant Aquent is a technology staffing agency. Aquent provides technology staff to GM to operate and manage the CRM sales lead program, including the vendor approval program. Id. ¶¶ 12, 27. Once assigned to GM, Aquent employees work from GM's corporate offices and use GM email accounts. Id. ¶ 12.

Plaintiff began marketing its CRMSuite software on the vendor advisor site in 2015. Id. ¶ 33, 41. But it did so not as a GM-approved vendor. It had not developed an integrated pipeline. So Plaintiff instead marketed its software on GM's site by using a third-party software producer's pipeline. Id. ¶¶ 39-40.Plaintiff kept marketing its software through a third-party pipeline through 2020 and claims GM was fully aware of this and did not object. Dkt. 38 ¶ 40.

In 2018, Plaintiff began marketing CRMSuite through Dominion Dealer Services, LLC. Id. ¶ 50. Plaintiff and Dominion marketed their respective products through Dominion's pipeline: Plaintiff marketed CRMSuite and Dominion marketed its product, Autobase. Dkt. Id. ¶¶ 50-51.

Dominion decided it would retire its Autobase product in 2019 and began marketing CRMSuite under its own label, "Vision." Id. ¶¶ 52-54. When Vision underperformed sales expectations, Dominion decided to retire its pipeline, pegging March 31, 2020, as the sunset date. Id. ¶ 69. In the interim, Dominion agreed to let Plaintiff keep marketing CRMSuite through the Dominion pipeline.

Preparing for life after Dominion, Plaintiff began developing its own pipeline to market its software directly to its dealer customers as a GM-approved vendor. Id. ¶¶ 69-73. Plaintiff contacted members of GM's technology staff provided by Defendant Aquent. Id. ¶ 73. Members of the technology staff informed Plaintiff that it would need to add about eight new functions to the CRMSuite software before it could integrate its pipeline with GM's computer systems. Id. ¶ 70.

Plaintiff began working on the required upgrades to its software and pipeline, investing $300,000 into the project. Id. ¶ 79. From 2019 to February2020, Plaintiff completed several of the additional functions, which GM's staff validated and approved. Dkt. 38 ¶¶ 80-81, 111. The tests for the remaining functions were slated for the first full week of February 2020. Id. ¶ 83. After these were completed, Plaintiff believed it would be a GM-approved vendor, and it was prepared to begin paying the vendor program fee. Id. ¶ 85.

Just before final testing, Dominion and Plaintiff officially agreed to end their business relationship. They agreed that Plaintiff would no longer use the Autobase pipeline once its own pipeline was completed in February 2020. Id. ¶¶ 86-87. Dominion also agreed to assign its rights under its GM vendor contract to Plaintiff and transfer to Plaintiff its remaining customers that were still using the Vision label of CRMSuite. Id. ¶ 87. Dominion sent an email to its customers explaining that Plaintiff would take responsibility for servicing the Vision product and would assume all of Dominion's outstanding CRM contracts. Id. ¶ 98; Dkt. 38-1.

Dominion informed GM of the plan to transfer to Plaintiff its rights under the vendor contract. GM sales lead program manager Anthony Fava (also an employee of Aquent) responded informing Dominion that its rights under the contract were not assignable. He further directed Dominion to notify its customers that they would not be transferred to Plaintiff and the Vision CRM product would no longer forward sales leads after March 31, 2020. Mr. Fava also informedDominion that Plaintiff's upcoming functions test was cancelled. Id. ¶ 100; Dkt. 38-3.

Dominion, having other business with GM outside the CRM sphere, heeded GM's request. It emailed its dealer customers, notifying them that once Vision went offline their accounts would not be transferred to Plaintiff and they would need to begin using a new GM-approved CRM product, which did not include CRMSuite. Dkt. 38 ¶ 104; Dkt. 38-6.

After sending the email, Dominion agreed to delay the shutdown date for Autobase to May 31, 2020, hoping Plaintiff and GM could settle their differences. Dkt. 38 ¶ 115. They could not. GM declined to allow Plaintiff to market CRMSuite on its vendor advisor website. Id. ¶ 116.

C. Procedural History

Plaintiff sued Defendants in state court. Dkt. 1-1. Defendants removed to this Court. Dkt. 1; Dkt. 1-9. Plaintiff then withdrew its Complaint and filed the Amended Complaint now before the Court. Dkts. 32, 38. Plaintiff's specific claims are based on two theories of harm: (1) detrimental reliance—Defendants represented, through "words and actions," that Plaintiff's product was GM-approved and would remain as such upon completion of the required upgrades; and (2) tortious interference in Plaintiff's business relationships with its dealer customers and its contractual relationship with Dominion. Dkt. 38 ¶¶ 70-79, 105,118-23. Both these theories also form the basis for the FDUTPA claim. Id. ¶¶ 139-44. Defendants move to dismiss all counts for failure to state a claim. Dkts. 41, 42.

II. LEGAL STANDARD

To survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead facts sufficient to state a claim that is "plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation omitted). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. In considering the motion, the Court accepts all factual allegations in the complaint as true and construes them in the light most favorable to the plaintiff. Pielage v. McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008) (citation omitted).

III. DISCUSSION

A. Aquent's Vicarious Liability

Plaintiff seeks to hold Aquent liable for the actions of its employees that it placed within GM to work as members of GM's technology staff. Defendant Aquent seeks to dismiss all Counts against it, arguing that Plaintiff has failed to establish a proper basis for vicarious liability by asserting what amounts to a right to relief based on strict liability. Dkt. 41 at 4-9. The Court agrees with Aquent.

Under Florida law, the doctrine of respondeat superior holds an employer responsible for harm caused by its employees acting within the scope of their employment. City of Boynton Beach v. Weiss, 120 So. 3d 606, 611 (Fla. 4th DCA 2013). An employee's conduct falls within the scope of employment when it "(1) is of the kind the employee is hired to perform, (2) occurs substantially within the time and space limits authorized or required by the work to be performed, and (3) is activated at least in part by a purpose to serve the master." Goss v. Human Servs. Assocs., Inc., 79 So. 3d 127, 132 (Fla. 5th DCA 2012). Moreover, "[a]bsent control, there is no vicarious liability for the act of another, even for an employee." Vasquez v. United Enters. of Sw. Fla., Inc., 811 So. 2d 759, 761 (Fla. 3d DCA 2002) (per curiam).

Here, Plaintiff has not plausibly alleged the prerequisites to establish respondeat superior liability. First, the Amended Complaint does...