United States District Court, E.D. Virginia, Alexandria Division
M. HILTON UNITED STATES DISTRICT JUDGE.
MATTER comes before the Court on Defendant Verisys
Corporation's Partial Motion to Dismiss Plaintiff's
Complaint pursuant to Rule 12(b)(6) for failure to state a
case arises from Plaintiff Robert Storey's former
employment with Defendant Verisys Corporation, first as
Director of Client Services and later as Vice President of
Sales and Marketing. Plaintiff's claims concern an
alleged agreement made between him and Defendant at the time
he was promoted to Vice President of Sales and Marketing by
which Defendant promised to pay Plaintiff at least six
percent commissions in addition to his regular salary for all
business deals acquired by Plaintiff. Plaintiff further
alleges that he prepared a proposal for a comprehensive
commission plan and sales structure at Defendant's
request, and worked diligently to bring in business
opportunities for Defendant in reliance on this agreement. On
July 28, 2017, Defendant terminated Plaintiff's
employment, and provided him with a check for $10, 740,
representing his earned commissions. Plaintiff claims that
this check did not amount to what was owed him under the
Plaintiff filed this action on November 15, 2017, asserting
five causes of action: breach of contract, breach of the
implied covenant of good faith and fair dealing, breach of an
implied contract, fraud, and constructive fraud. On December
22, 2017, Defendant filed a Partial Motion to Dismiss Counts
II-V of the complaint (all claims except the breach of
contract claim). For the reasons explained herein, this Court
finds that the motion should be granted.
motion to dismiss tests the sufficiency of the complaint.
See Republican Party of N.C. v. Martin, 980 F.2d
943, 952 (4th Cir. 1992). In a Rule 12(b)(6) motion to
dismiss, the court must accept all well-pled facts as true
and construe those facts in the light most favorable to the
plaintiff. Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). The complaint must provide a short and plain
statement showing that the pleader is entitled to relief,
Fed.R.Civ.P. 8(a)(2), and it must state a plausible claim for
relief to survive a motion to dismiss, Iqbal, 556
U.S. at 679. The court does not accept as true any
"unwarranted inferences, unreasonable conclusions, or
arguments." E. Shore Markets, Inc. v. J.D.
Associates Ltd., 213 F.3d 175, 180 (4th Cir. 2000). If
the complaint does not state a plausible claim for relief,
the court should dismiss the claim. Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007).
II of Plaintiff's Complaint alleges a claim for breach of
the implied covenant of good faith and fair dealing. However,
Virginia law does not recognize such an independent cause of
action. Instead, a breach of the implied covenant of good
faith and fair dealing "only gives rise to a breach of
contract claim, not a separate cause of action."
Frank Brunckhorst Co., L.L.C. v. Coastal Atl., Inc.,
542 F.Supp.2d 452, 462 (E.D. Va. 2008). Therefore, Count II
must be dismissed.
Count III, Plaintiff alleges that Defendant breached an
implied contract by failing to pay him commissions earnings
despite having agreed to do so. Specifically, the Complaint
alleges that Plaintiff rendered valuable services to
Defendant in the form of sales expertise and management
skills, that these services were rendered at Defendant's
request, that Defendant benefitted from these services, and
that Plaintiff rendered such services in reliance on
Defendant's representations that Plaintiff would be
compensated with commissions earnings of at least six percent
on all deals acquired.
implied contract "differs from an actual contract in
that the parties have not reduced it to a writing or to an
oral agreement; rather, the court infers the implied-in-fact
agreement from the course of conduct of the parties."
Nossen v. Hoy, 750 F.Supp. 740, 744 (E.D. Va. 1990).
The problem with Plaintiff's implied contract claim is
that he alleges an actual agreement between himself and
Defendant. Although he claims it was never agreed to in
writing, Plaintiff nevertheless alleges that the Defendant
orally agreed to pay Plaintiff at least six percent
commissions on all deals acquired, and that Defendant has
breached this oral agreement. Since Plaintiff's
allegations are inconsistent with an implied contract, this
claim must also be dismissed. See Bright v. QSP,
Inc., 20 F.3d 1300, 1306 (4th Cir. 1994} ("It is a
well-rooted principle of contract law that 'an express
contract and an implied contract, relating to the same
subject matter, cannot co-exist.'") (quoting
Case v. Shepherd, 84 S.E.2d 140, 144 ( W.Va. 1954)).
Count IV asserts a cause of action of fraud. As an initial
matter, Federal Rule of Civil Procedure 9(b) provides a
higher pleading standard for fraud claims, requiring the
plaintiff to "state with particularity the circumstances
constituting fraud or mistake." Fed.R.Civ.P. 9(b). This
standard requires the plaintiff to "state the time,
place and content of the false misrepresentations, the fact
misrepresented and what was obtained or given up as a
consequence of fraud." Scowcroft Group, Inc. v.
Toreador Resources Corp., 666 F.Supp.2d 39, 43 (D.D.C.
courts are generally resistant to "attempts to transfer
breach of contract cases into fraud and therefore fraud
cannot ordinarily be predicated on unfulfilled promises or
statements of future events." Flip Mortg. Corp. v.
McElhone, 841 F.2d 531, 537 (4th Cir. 1988). A plaintiff
can, however, recover for a misrepresentation of an intent to
perform. In order to recover for such misrepresentation, the
plaintiff must prove that the promisor made the promise while
knowing it was false, with intent to induce the
promisee's performance, and that the promisee
detrimentally relied on the promise. See T.G. Slater
& Son v. Donald P. & Patricia A. Brennan LLC,
385 F.3d 836, 844 (4th Cir. 2004).
has not alleged with sufficient particularity facts to
support a claim that Defendant misrepresented an intent to
perform. Plaintiff asserts a conclusory allegation that
Defendant intentionally and knowingly misrepresented its
intention to compensate Plaintiff with at least six percent
commissions on closed deals. However, Plaintiff does not
plead any facts to support the allegation that, at the time
the promise was made, Defendant did not intend to fulfill it.
Thus, because Plaintiff has not pleaded with particularity
the facts supporting his fraud claim, this claim must also be
Count V asserts a claim of constructive fraud. Constructive
fraud requires a plaintiff to show that "the defendant
negligently or innocently made a false representation of
material fact, and that the plaintiff suffered damage as a
result of his reliance upon that misrepresentation."
Supervalu, Inc. v. Johnson, 276 Va. 356, 367, 666
S.E.2d 335, 341-42 (20 08). A constructive fraud claim is not
available under the circumstances here presented, however, in
which the alleged misrepresentation is a promise of future
action. "The rationale underlying this rule is plain. If
unfulfilled promises, innocently or negligently made, were
sufficient to support a constructive fraud claim, every
breach of contract would potentially give rise to a claim of
constructive fraud." Id. at 368, 666 S.E.2d at
342. Thus, Count V must also be dismissed.
foregoing reasons, this Court finds that Defendant's
Partial Motion to Dismiss should be granted, and that Counts
II, III, IV, and V of Plaintiff's Complaint ...