326 F. Supp. 3d 26
S.D. Ill.2018Background
- Mirage (Carey’s loan-out corporation) contracted with FEG Argentina and FEG Chile for October 2016 concerts in Buenos Aires and Santiago; installment payments were due in September 2016 but were late or deficient.
- Each Agreement allowed Carey to cancel for nonpayment but contained a written notice-and-cure procedure (48 hours).
- Carey cancelled the Argentina and Chile dates in late October 2016; she tweeted: “Devastated my shows in Chile, Argentina & Brazil had to be cancelled. My fans deserve better than how some of these promoters treated them,” linking to an E! News article.
- Counterclaimants (FEG Argentina and FEG Chile) asserted counterclaims for breach of contract (failure to give notice and cure before cancelling) and defamation (based on the Tweet).
- Defendants (Mirage and Carey) moved to dismiss: they submitted email chains they say supplied notice, argued Carey is not a proper party to breach claims (not a signatory), and argued the Tweet is nonactionable opinion and time-barred.
- Court accepted counterclaims’ allegations as true for the motion, declined to consider the extrinsic email chains at Rule 12(b)(6), dismissed Carey from the breach claims, dismissed Mirage from the defamation claim, and dismissed the defamation claim on the merits as nonactionable opinion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether defendants gave required written notice and opportunity to cure before cancelling (breach) | Counterclaimants say no written notice in accordance with the Agreements; they relied on course of dealing where late payments went uncured | Defendants rely on email chains (UTA emails) to show notice and cure was given | Court denied dismissal on this ground because emails were not incorporated into the pleading and extrinsic factual disputes preclude consideration at 12(b)(6) |
| Whether court may consider email chains attached to defendants’ motion on a 12(b)(6) motion | N/A (plaintiff did not rely on those emails in drafting) | Defendants urged the emails are integral and judicially noticeable | Court refused to consider the emails because the complaint did not rely on them and their relevance raised material factual disputes better suited for summary judgment |
| Whether Carey (non-signatory) may be liable on breach via veil piercing/alter-ego | Counterclaimants alleged Carey controls Mirage and is its sole owner/officer; thus she may be held liable | Defendants argued Mirage alone was the contracting party; Carey is a nonsignatory | Court dismissed Carey from breach claims: plaintiffs failed to plead abuse of the corporate form or fraud necessary for veil piercing |
| Whether the Tweet is defamatory | Counterclaimants alleged the Tweet falsely accused promoters of mistreating fans and damaged reputation | Defendants argued Tweet is opinion, not a provable false statement, and thus protected by the First Amendment; also asserted statutes of limitations and that Mirage is not liable for Carey’s personal tweet | Court dismissed defamation counterclaim: (1) Tweet was nonactionable opinion (linked to E! News article, disclosed basis for the opinion, and was not provably false); (2) Mirage cannot be held liable absent facts showing Carey acted for the corporation; the defamation claim otherwise was timely under CPLR § 203(d) |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (establishes plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading must include factual content permitting plausible inference of liability)
- Chambers v. Time Warner, Inc., 282 F.3d 147 (documents integral to complaint may be considered; plaintiff reliance required)
- Morris v. N.Y. State Dep't of Taxation & Fin., 82 N.Y.2d 135 (veil-piercing requires domination plus abuse/fraud)
- Levin v. McPhee, 119 F.3d 189 (mixed-opinion doctrine: opinion implying undisclosed factual basis can be actionable)