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949 F.3d 417
8th Cir.
2020
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Background

  • Ambassador Press purchased a Durst Rho 1012 commercial printer after Durst sales reps and materials represented the machine’s speed ("at least 50% faster" than a competitor; "the fastest 12 picoliter 1000 dpi printer") and low print-head failure/durability. Durst provided output charts and head-replacement data for some models.
  • Ambassador personnel inspected Durst’s facility/booth in Austria, saw demonstrations and manufacturing/testing of print heads, and then bought the printer, a service plan, and a two-year warranty.
  • Over four years Ambassador alleges poor performance: the printer never achieved promised speeds and required 54 print-head replacements. Ambassador sued for consumer and common-law fraud four years after purchase.
  • The district court dismissed the consumer-fraud claim, allowed an amended common-law fraud claim, then dismissed that amended complaint for failure to plead fraud plausibly and for failure to plead detrimental reliance with particularity.
  • On appeal the Eighth Circuit reviewed the dismissal de novo, applied federal pleading standards to Minnesota fraud law, and affirmed the dismissal, concluding Ambassador’s allegations were conclusory and insufficiently particular to show falsity or Durst’s intent and did not plead justifiable reliance.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether Ambassador pleaded fraudulent misrepresentation with the specificity required by Rule 9(b) and plausibility standards Ambassador: alleged who/what/where/when statements, provided expected speeds, alleged on information and belief that Durst knew of speed and head problems Durst: allegations are conclusory, lack concrete facts showing actual speeds achieved or that Durst knew representations were false at the time of sale Court: Dismissed — allegations insufficiently particular or factual to show falsity or intent (fails Twombly/Iqbal and Rule 9(b))
Whether Ambassador pleaded justifiable/detrimental reliance with particularity Ambassador: purchase of printer, service plan, and warranty shows reliance on Durst’s representations Durst: Ambassador is a sophisticated commercial buyer who inspected the machine and conducted independent investigation, so reliance cannot be merely conclusory Court: Dismissed — single conclusory statement of "would not have purchased but for" is inadequate; independent investigation undermines plausible justifiable reliance

Key Cases Cited

  • Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (pleading must state a plausible claim to survive dismissal)
  • Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (plausibility standard for factual allegations)
  • Drobnak v. Andersen Corp., 561 F.3d 778 (8th Cir. 2009) (Rule 9(b) rejects bare allegations on information and belief when plaintiff has access to the facts)
  • Munro v. Lucy Activewear, Inc., 899 F.3d 585 (8th Cir. 2018) (mere allegation that broken promises show intent to defraud is insufficient without supporting facts)
  • Johnson v. Bobcat Co., 175 F. Supp. 3d 1130 (D. Minn. 2016) (specific measurable performance allegations can satisfy Rule 9(b))
  • Podpeskar v. Makita U.S.A. Inc., 247 F. Supp. 3d 1001 (D. Minn. 2017) (detailed defect allegations and supporting consumer complaints satisfied particularity)
  • City of Wyoming v. Procter & Gamble Co., 210 F. Supp. 3d 1137 (D. Minn. 2016) (attachments and photos showing falsity supported Rule 9(b) claims)
  • Schaller Tel. Co. v. Golden Sky Sys. Inc., 298 F.3d 736 (8th Cir. 2002) (Rule 9(b) requires time, place, contents, and identity of person making misrepresentation)
  • Valspar Refinish, Inc. v. Gaylord’s, Inc., 764 N.W.2d 359 (Minn. 2009) (reasonable reliance judged by sophistication, experience, and opportunity to investigate)
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Case Details

Case Name: Ambassador Press, Inc. v. Durst Image Technology U.S.
Court Name: Court of Appeals for the Eighth Circuit
Date Published: Feb 5, 2020
Citations: 949 F.3d 417; 18-3017
Docket Number: 18-3017
Court Abbreviation: 8th Cir.
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    Ambassador Press, Inc. v. Durst Image Technology U.S., 949 F.3d 417