Hunter v. Shield

RUTH A. HUNTER, et al., Plaintiffs, v. RHINO SHIELD, et al., Defendants.

Case No. 2:18-cv-1097

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO EASTERN DIVISION

September 26, 2019

JUDGE EDMUND A. SARGUS, JR.

Magistrate Judge Elizabeth Preston Deavers

OPINION & ORDER

Currently pending before the Court are two Motions to Dismiss filed by Defendant Aleksandre Dgebuadze ("Dgebuadze") (ECF No. 39); and collectively by Defendants AmCoat Industries Inc. ("AmCoat"), AmCoat Technologies Incorporated ("AmCoat Tech"), Steven Dominique ("Dominique"), Rudolph Pallone ("Pallone"), Rhino Shield ("Rhino"), Rhino Shield Florida ("Rhino Florida"), Tristate Coating, Inc. ("Tri-state"), and James Williams ("Williams") (referred to collectively as the RS Defendants) (ECF No. 43). Plaintiffs responded to both Motions to Dismiss. (ECF Nos. 45, 51). Defendant Dgebuadze replied. (ECF No. 50). The RS Defendants did not reply, and the time to file such a reply has passed. Accordingly, both matters are ripe for disposition. For the reasons stated herein, Dgebuadze's Motion to Dismiss (ECF No. 39) is GRANTED in part and DENIED in part and the RS Defendants' Motion to Dismiss (ECF No. 43) is DENIED.

I.

Plaintiffs Ruth A. Hunter and Mark D. Hunter (as Executor for the estate of David G. Hunter) ("Plaintiffs") commenced this action on September 21, 2018, through the filing of a seven- count Complaint. (See Compl. [ECF No. 1]). On November 8, 2018 Plaintiff filed an eight-count Amended Complaint. (See Am. Compl. [ECF No. 18]). Plaintiff asserts claims for: 1) violations of the Ohio Consumer Sales Practices Act (Am. Compl. ¶¶ 187-194); 2) "Negligent and/or Intentional Misrepresentation" (Id. ¶¶ 195-201); 3) Breach of Contract (Id. ¶¶ 203-211); 4) Violations of the Ohio Home Sales Solicitation Act (Id. ¶¶ 212-216); 5) Breach of Express and Implied Warranties and Violations of the Magnuson Moss Warranty Act (Id. ¶¶ 217-230); 6) Civil Conspiracy (Id. ¶¶ 231-236); 7) "Declaratory Judgment that Defendants are Vicarious Liability [sic] As Agents, Agents by Estoppel, Apparent Authority, and as a Joint Venture" (Id. ¶¶ 237-244); and 8) Alter Ego Liability (Id. ¶ 245-247).

A. Background

For the purposes of the Moving Defendants' Motions to Dismiss, the Court has considered all the facts properly before it and has taken all facts alleged in the Amended Complaint as true. This case stems from the alleged misapplication of Rhino Shield, a ceramic coating, onto the exterior of the Hunters' home. In late 2012, David Hunter ("Mr. Hunter") saw an advertisement for a company referred to as "Rhino Shield," which offered services relating to cleaning and painting the exterior of houses. Mr. Hunter called the number displayed during the advertisement and was connected with a representative who purported that he or she worked for "Rhino Shield."

On November 14, 2012, Pallone, a sales representative from the company that advertised itself as "Rhino Shield," came to the Hunters' home and met with Mr. Hunter. Throughout Mr. Hunter and Pallone's conversation, Pallone represented that he worked for "Rhino Shield," and at no time during the conversation did he state that he represented other business entities. Before leaving, Pallone provided Mr. Hunter with an estimate for "Rhino Shield's" services and, afterdescribing the benefits of the Rhino Shield coating, Pallone informed Mr. Hunter that if he failed to sign on contract before January 1, 2013, the prices would increase.

On December 31, 2012, Mr. Hunter signed a contract with Tri-State to complete his home repairs. The contract at issue has been attached to Plaintiffs' Amended Complaint as Exhibit J. (See Contract [ECF No. 18-1]). The contract listed what services were and were not included in the contract price of $11,998.00. The agreement stated that any check should be made payable to "Rhino Shield." Incorporated into the contract is the "Tri-State Coating Limited warranty" which states:

Tris-State Coating warrants the material is of the quality specified and will transfer to the Customer all manufacturer's written warranties. Tri-State Coating warrants workmanship for two (2) years after the date of completion and will remedy substantial defects without charge to the Customer, on written notice from Customer within such period. Tri-State Coating and Customer agree that all implied warranties including, without limitations, warranties of habitability, fitness for a particular purpose and merchant ability [sic] are hereby excluded and there are no warranties or representations which extend beyond those expressly set forth in this agreement.

Tri-State Coating makes no warranties express or implied regarding any of the products or services except the express warranties provided herein. TRI-STATE COATING EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXCEPT AS PROVIDED HEREIN. WITHOUT LIMITING THE FOREGOING, THERE IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE WITH RESPECT TO THE GOODS OR SERVICES SOLD.

TRI-STATE COATING WILL NOT BE RESPONSIBLE OR LIABLE FOR INDIRECT OR CONSEQUNTIAL DAMAGES OF ANY KIND, however arising, including but not limited to those for use of any products, loss of time, inconvenience, lost profits, labor charges, or other incidental or consequential damages with respect to persons, business, or property, whether as a result of breach of warranty, breach of contract, negligence or otherwise. Notwithstanding any other provision of this Contract, BUYER'S REMEDY AGAINST TRI-STATE COATING FOR SERVICES SUPPLIED OR FOR NON-DELIEVERED SERVICES OR FAILURE TO FURNISH SERVICE, THER [sic] OR NOT BASED ON NEGLIGENCE, STRICT LIABILITY, BREACH OF CONTRACT OR BREACH OF EXPRESS WARRANY [sic], IS LIMITED SOLELY TO RETURN OF THE ORDER PRICE ACTUALLY PAID FOR SUCH PRODUCTS

OR SERVICES AND IN NO EVENT SHALL TRI-STATE COATING LIABILITY EXCEED THE PRICE OR CHARGE FOR SUCH PRODUCTS OR SERVICES.

(Contract at 2) (emphasis in original). Pallone did not review the Contract's second page with Mr. Hunter. They discussed only the first page, which details the pricing. The Limited Warranty clause is on the second page of the Contract. And no one from Tri-State signed the Contract signed by Mr. Hunter.

Work began on the Hunters' home on or about May 3, 2013. (Am. Compl. ¶ 146). The workers, whom the Hunters presumed to be "Rhino Shield" employees, began work on May 3, 2013 by pressure washing the house. On May 4, 2013, John Robertson ("Robertson") and two other unidentified individuals arrived at the Hunters' house. At the time, the Hunters presumed these individuals too were Rhino Shield employees but have since learned that the workers were actually subcontractors. (Id. ¶ 150). Robertson prepared the coating to be applied to the Hunters' home on May 4, 2013. He and his men prepared the house by taping around windows and doors. However, they ran out of tape, which later caused some areas to be improperly coated. (Id. ¶ 151). Another contractor that "Rhino Shield" hired to work on the Hunters' home was Dgebuadze. However, the Hunters asserted that Dgebuadze "holds himself out as Rhino Shield;" and claimed that Dgebuadze was one the contractors who is "primarily responsible" for the damage done to their home. (Id. ¶ 99).

The Hunters allege that Defendants further failed to comply with the Contract, such failures including: 1) failing to replace bad or damaged wood, (Am. Compl. ¶ 152); 2) failing to caulk and seal the cracks in the stucco, (id. ¶ 153); 3) failing to repair cracks in the stucco and inspect the stucco prior to applying the coating, (id. ¶ 154); 4) failing to clean the stucco before applying thecoating, (id.); 5) failing to remove the downspouts prior to applying the coating, (id.); 6) failing to cover the roof, (id.).

When the Hunters brought their concerns to Pallone, he acknowledged the problems, but he assured the Hunters that all the problems would be fixed and the area would be clean. The Plaintiffs assert that the damage to their home caused by the work crew has yet to be corrected. Moreover, Plaintiffs assert that the Rhino Shield coating applied to their home is defective and that it was not applied to the advertised thickness. As such, the Hunters claim that the Rhino Shield coating "continues to peel, split, crack, blister, and break." (Am. Compl. ¶ 159).

On June 7, 2013, the Hunters met with Pallone and told him the "issues, deficiencies, and problems" that they had with the Rhino Shield coating and the application of the coating onto their home. (Am. Compl. ¶ 161). The Hunters detailed to Pallone the areas that they believed needed to be repaired pursuant the warranties. Pallone communicated to the Hunters that he lacked the authority to approve repairs for the alleged damage done to the Hunters roof and told them that "only Jim Williams could do that." (Id.). However, Pallone assured the Hunters that the other damages would be repaired. (Id.). It was after this meeting, on June 7, 2013, that the Hunters first realized that they were dealing with an entity other than "Rhino Shield," as "Tri-State Coating" was listed on the sign in sheet for the meeting. (Id. ¶ 162).

Mr. Hunter then conducted an internet search of "Rhino Shield" and found a Florida-based company that went by that name, but that also called itself "AmCoat." (Id. ¶ 163). Mr. Hunter contacted the Florida Rhino Shield company and spoke with Terry Andre who stated his company was Rhino Shield and that he worked with a Jim Williams. (Id. ¶¶ 163-64). On June 12, 2013 Williams sent a letter apologizing to the Hunters. In this letter, Williams told the Hunters that the job would be completed as early as June 14, 2013 and that they would work to fix the items on thewarranty list provided to the Hunters. (Id. ¶ 166; see also 6/12/2013 Williams Letter [ECF No. 18-2]).

On June 13, 2013, Pallone emailed the Hunters acknowledging that certain repairs needed to be made and inquiring whether the Hunters were amiable to the...