Intres v. Neumeier Enterprises, Inc.
2:22-cv-02067
W.D. Ark.Mar 14, 2023Background
- Plaintiff Jonathan Intres sued his employer Neumeier Enterprises alleging misclassification and unpaid off-the-clock work; Neumeier counterclaimed that Intres falsified timesheets and was overpaid.
- Neumeier’s original counterclaim pleaded conversion for alleged wage overpayments; the Court dismissed that claim and granted leave to amend to plead fraud.
- The amended counterclaim alleges Intres knowingly falsified time entries (e.g., failing to clock out on numerous days) and was overpaid approximately $1,861.90 in 2021.
- Intres moved to dismiss the amended fraud counterclaim for failure to satisfy Rule 9(b)’s particularity requirement.
- Neumeier attached an Exhibit A in opposition showing pay-period entries and calculated purported overpayments, but the exhibit was not incorporated into the counterclaim.
- The Court considered whether the counterclaim and Exhibit A met the ‘‘who, what, where, when, and how’’ standard for fraud pleading and whether leave to amend should be allowed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of fraud pleading under Rule 9(b) | Intres: fraud not pled with particularity; lacks who/what/when/where/how | Neumeier: amended pleading plus Exhibit A show specific falsified entries and amounts | Counterclaim dismissed for failure to meet Rule 9(b); dismissal without prejudice; leave to amend granted |
| Consideration of Exhibit A on motion to dismiss | Exhibit A is incoherent and not part of the pleading | Exhibit A supplies representative examples of false claims | Court will not consider Exhibit A on 12(b)(6) because it was not part of the counterclaim; Exhibit A also insufficient on its face |
| Redundancy given affirmative defense / leave to amend | Intres: counterclaim unnecessary because same allegations are a defense and can offset damages | Neumeier: counterclaim seeks affirmative recovery and employer has factual knowledge to allege details | Court rejects redundancy argument; allows Neumeier to amend because deficiencies appear to be inartful pleading and Neumeier likely has facts to plead particularity |
Key Cases Cited
- Gallagher v. City of Clayton, 699 F.3d 1013 (8th Cir. 2012) (standard for accepting pleaded facts and reasonable inferences on a motion to dismiss)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility standard for federal pleadings)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleadings must do more than recite labels and conclusions)
- Drobnak v. Anderson Corp., 561 F.3d 778 (8th Cir. 2009) (fraud must plead who, what, where, when, and how)
- United States ex rel. Joshi v. St. Luke's Hosp., Inc., 441 F.3d 552 (8th Cir. 2006) (representative examples can satisfy Rule 9(b) in false-claim contexts)
- United States ex rel. Thayer v. Planned Parenthood of the Heartland, 765 F.3d 914 (8th Cir. 2014) (alternative route: plead scheme details plus indicia of reliability/personal knowledge)
- Mattes v. ABC Plastics, Inc., 323 F.3d 695 (8th Cir. 2003) (courts consider only materials necessarily embraced by the pleadings)
- In re Baycol Prods. Litigation, 732 F.3d 869 (8th Cir. 2013) (example of sufficiency under Rule 9(b) by identifying who, what, when, how and connecting fraud to specific financial injury)