111 F. Supp. 3d 306
E.D.N.Y2015Background
- Plaintiff submitted a cereal breakfast drink idea via Kellogg's Gr-r-reat Ideas! portal in late 2008 after agreeing to Terms and Conditions.
- Kellogg emailed in January 2009 that it was not interested in the opportunity.
- Kellogg applied for and later launched a Breakfast To Go product line; Plaintiff alleges similarity to his submitted concept.
- Plaintiff sent a 2014 letter claiming Kellogg stole his idea; Kellogg denied similarity and asserted rights from the submission.
- Plaintiff filed a diversity action in 2014; the Second Amended Complaint asserts breach of implied contract and unjust enrichment under Michigan law.
- Court considers Terms and Conditions (integrated by reference) and determines they govern the dispute and foreclose relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are the Terms and Conditions properly incorporated? | Plaintiff vague references are insufficient to incorporation. | Terms and Conditions are integrated and binding. | Yes; Terms and Conditions incorporated and controlling. |
| Does implied contract claim survive given express terms? | Kellogg’s use of idea breaches implied contract. | Express contract covers compensation terms; no implied contract. | Dismissed; express contract precludes implied contract claim. |
| Does unjust enrichment claim survive with an express contract? | Kellogg’s discretionary terms lead to unjust enrichment. | Express contract bars unjust enrichment when subject matter is covered. | Dismissed; express contract forecloses unjust enrichment claim. |
| Should the plaintiff be granted leave to replead? | Amendment could state a viable claim. | Further amendment would be futile due to substantive defects. | Denied; amendment would be futile. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (plausibility pleading standard)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (facial plausibility requirement)
- Kassner v. 2nd Ave. Delicatessen, Inc., 496 F.3d 229 (2d Cir. 2007) (pleading standards; non-conclusory facts required)
- L-7 Designs, Inc. v. Old Navy, LLC, 647 F.3d 419 (2d Cir. 2011) (incorporation by reference in 12(b)(6) context)
- Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42 (2d Cir. 1991) (documents integral to complaint)
- Sira v. Morton, 380 F.3d 57 (2d Cir. 2004) (integrality of attached documents on motion to dismiss)
- Belle Isle Grill Corp. v. City of Detroit, 666 N.W.2d 271 (Mich. App. 2003) (implied contract principles in Michigan)
- Hudson v. Mathers, 770 N.W.2d 883 (Mich. App. 2009) (unjust enrichment requires absence of express contract)