United States District Court, W.D. North Carolina, Statesville Division
C. Mullen United States District Judge
matter is before the Court upon Defendants' Motions to
Dismiss pursuant to Rule 12(b)(6) of the Federal Rules of
Civil Procedure (Doc. Nos. 35 and 37). These motions have
been fully briefed and are ripe for disposition.
Mike and Betty Bendfeldt, entered into a series of
“License Agreements” with Defendant Window World,
Inc. (“WW”) between 2001 and 2009. (Am. Compl.
¶ 15). WW operated a “licensing” system
involving the sale and installation of replacement windows.
(Id. at ¶ 5). Under the License Agreements,
Plaintiffs were led to believe that they would be part of the
Window World system, could utilize the WW trademarks, trade
dress and business methods and would have access to the best
pricing for windows and related materials due to the
volume-buying power of the WW system. (Id. at ¶
7). The License Agreement contained a provision requiring
that Plaintiffs and other Licensees purchase windows and
related materials only from suppliers approved by WW.
(Id. at ¶ 8). Originally, WW permitted
franchisees to buy windows from more than one supplier,
including Defendant Associated Materials, LLC
(“AMI”). AMI had been one of the WW-approved
suppliers of replacement windows to WW licensees since at
least 2000. (Id. at ¶ 9).
2007, WW announced that it had designated AMI as its
exclusive supplier of windows. (Id. at ¶ 37).
Plaintiffs allege that WW received “rebates” from
AMI for every window sold by AMI, the nature and extent of
which were not fully disclosed to WW Licensees. (Id.
at ¶ 47). In addition, instead of ensuring that WW
Licensees received superior pricing, the agreement between
Defendants WW and AMI actually resulted in prices much higher
than prices charged to non-WW retailers. However, the
Plaintiffs continued to buy several franchises long after WW
designated AMI as its exclusive window supplier.
(Id. at ¶ 15).
2011, Defendant WW admitted to its Licensees that the
relationship of the parties was, and always had been, a
franchise relationship. (Id. at ¶ 23).
Plaintiffs allege that Defendant WW intentionally misled its
“Licensees, ” in order to avoid certain
disclosure requirements of the Federal Trade Commission and
various state regulations including the requirement that the
franchisor (WW) disclose whether it receives any
consideration from a mandated supplier. (Id. at
¶¶ 25-28). It was only after WW admitted that it
had been selling franchises that Plaintiffs discovered that a
large part of the revenue of WW was derived from kickbacks it
received from suppliers such as Defendant AMI.
Plaintiffs filed this lawsuit seeking
recovery against Defendants under a variety of legal
theories. Count I of the Amended Complaint seeks recovery for
violation of the Robinson-Patman Act for competitive injury
due to the disparate prices charged by Defendant AMI. Count V
seeks recovery for violations of the Sherman Antitrust Act.
Counts VI and VII seek recovery alleging violation of the
Racketeer Influenced and Corrupt Organization Act (RICO).
This case was originally filed in the federal district court
in Nebraska and transferred to this Court upon motion of the
Defendants on the basis of forum selection clauses and the
doctrine of forum non conveniens. Defendants have filed
separate Motions to Dismiss Counts I, V, VI and VII pursuant
to Rule 12(b)(6) of the Federal Rules of Civil Procedure.
Standard of Review
survive a motion to dismiss, the Bendfeldts must allege
“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). This evaluation is a
“context-specific task that requires the reviewing
court to draw on its judicial experience and common
sense.” Ashcroft v. Iqbal, 556 U.S. 662, 679
(2009). This “plausibility” standard is
“more than a sheer possibility that a defendant has
acted unlawfully.” Id. at 678. Pleading facts
that could conceivably support a finding of liability is
insufficient. Twombly, 550 U.S. at 547;
Iqbal, 556 U.S. at 680.
Court should not “accept as true a legal conclusion
couched as a factual allegation.” Twombly, 550
U.S. at 555 (quoting Papasan v. Allain, 478 U.S.
265, 286 (1986)). Neither formulaic recitations of legal
elements nor naked assertions devoid of factual enhancement
will do. Iqbal, 556 U.S. at 678. “Threadbare
recitals of the elements of a cause of action, supported by
mere conclusory statements, do not suffice.”
Robinson-Patman Act (Count I)
Robinson-Patman Act provides in pertinent part:
It shall be unlawful for any person engaged in
commerce…to discriminate between different purchasers
of commodities of like grade and quality…where the
effect of such discrimination may be substantially to lessen
competition or tend to create monopoly in any line of
commerce or to injure, destroy, or prevent discrimination
with any person who either grants or ...