BMADDOX ENTERPRISES LLC, d/b/a SILENCER CENTRAL, Plaintiff, vs. FEDERAL EXPRESS CORPORATION, d/b/a/ FedEx, Defendant.
4:25-CV-04196-RAL
UNITED STATES DISTRICT COURT DISTRICT OF SOUTH DAKOTA SOUTHERN DIVISION
June 9, 2026
ROBERTO A. LANGE, CHIEF JUDGE
Plaintiff BMaddox Enterprises LLC, doing business as Silencer Central (Silencer Central), sued Defendant Federal Express Corporation (FedEx). Doc. 1. Silencer Central‘s Amended Complaint seeks damages for negligent misrepresentation, breach of contract, and promissory estoppel. Doc. 6. FedEx filed a Motion to Dismiss, Doc. 14, under
I. Facts
This Court makes no findings of fact but derives the facts from Silencer Central‘s Amended Complaint, Doc. 6, accepting all the factual allegations as true, which this Court must do in ruling
Silencer Central sells firearm sound suppressors (Silencers1) and accessories to customers for various firearm applications. Doc. 6 ¶ 9. As part of that business, Silencer Central “assists customers with Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) paperwork and compliance.” Id. ¶ 10. “Silencer Central markets its products to customers with a ‘Direct to Door Shipping’ option,” and Silencer Central “deliver[s] its products directly to customers in the 42 states where such sales are permitted.” Id. ¶ 11. Silencer Central historically contracted with FedEx “to ship and deliver Silencer Central‘s products, including its Silencers, from its warehouse in Sioux Falls, South Dakota to Silencer Central‘s 41 other business locations within the United States, which is referred to as its ‘bulk business to business’ leg of product delivery.” Id. ¶ 12. Silencer Central holds and maintains a Federal Firearms License (FFL) for these various business locations. Id. ¶ 47. Before the agreement in dispute here, Silencer Central had to arrange shipping from its various business locations directly to its consumers with a different delivery company. Id. ¶ 13.
In 2024, FedEx approached Silencer Central to expand their existing relationship to include FedEx‘s shipment of products from Silencer Central‘s various business locations directly to Silencer Central‘s customers, “eliminating the need for Silencer Central to arrange for two separate stages of shipping with two different companies for its products.” Id. ¶ 14. “FedEx knew that Silencer Central‘s primary products that were to be shipped and delivered to customers were Silencers” when it approached Silencer Central to expand their business relationship. Id. ¶ 15.
On or about September 6, 2024, several FedEx employees, including Laurel Nelson and Lee Silverstein, visited Silencer Central‘s Sioux Falls facility to learn more about Silencer Central‘s shipping process and customer experience. Id. ¶ 17. FedEx employees inquired about why Silencer Central was not using FedEx for shipments directly to customers. Id. ¶ 18. Silencer Central responded that “it did not believe it was permitted to use FedEx to ship directly to customers,” to which FedEx responded that Silencer Central could, in fact, ship Silencers directly to its customers through FedEx and consolidate all its transportation needs with FedEx. Id. ¶ 19. “FedEx affirmatively and unequivocally represented to Silencer Central that its transportation and pricing . . . would include FedEx two-day delivery from each of Silencer Central‘s FFL business locations to customers’ homes” in subsequent communications and negotiations. Id. ¶ 20.
In December 2024, Silencer Central notified its former product delivery service provider for customer deliveries that Silencer Central was transitioning to FedEx for this service. Id. ¶ 21. In January 2025, during negotiations, Silencer Central received a draft agreement from FedEx with contract language that was inconsistent with the parties’ previous discussion “about how the delivery service relationship would operate and key terms of that expanded relationship.” Id. ¶ 22. Due to the discrepancy, Silencer Central raised issues in communications to FedEx, including an email stating:
On the last page where the language states “FedEx reserves the right to amend, modify or discontinue the Program or Customer‘s participation in the Program at any time. Notwithstanding, FedEx and Customer agree that either party may terminate this Program at any time upon thirty (30) days written notice to the other.” You won‘t use this language to make a Silencer unfriendly amendment or discontinue the program or use the 30 day no cause termination right during the first year as our efforts associated with the movement to this program are massive and we need to capture the rebates to make this competitive.
On or about February 5, 2025, based on extensive negotiations and in reliance on the representations by FedEx, Silencer Central and FedEx executed the “FedEx Transportation Services Agreement” (TSA). Id. ¶ 27. Under the TSA, “FedEx agreed to provide certain transportation services (Services) to Silencer Central, for the applicable Service identified on the pricing attachments that are attached hereto and incorporated herein.” Id. ¶ 28 (internal marks omitted). The TSA contained three attachments regarding various pricing terms for different delivery options provided by FedEx Express, FedEx Ground, and FedEx Freight to Silencer Central. Id. ¶¶ 30-32. Another attachment to the TSA entitled the “Earned Discount Program Details” provides “terms regarding discounts that Silencer Central will earn according to the pricing attachments.” Id. ¶ 33. The TSA‘s final attachment, the “Contract Additional Incentive,” “provides that Silencer Central will be paid an additional incentive if it achieves $8,000,000 in annualized gross transportation charges in the first year of the [TSA].” Id. ¶ 34. Silencer Central alleges in addition to the previous representations made during negotiations, “the anticipated discounts, rebates, and/or contract incentives2 promised in the [TSA] were key, material terms that Silencer Central relied upon” in switching to FedEx. Id. ¶ 35.
In May 2025, FedEx told Silencer Central that it would no longer ship Silencers directly to customers. Id. ¶ 40. Silencer Central alleges: “According to FedEx, despite its promises to Silencer Central, FedEx had not authorized an exception for customer delivery of Silencer Central‘s products. FedEx told Silencer Central that it would have to request an exception from FedEx for shipments directly to customers.” Id. “FedEx offered a temporary extension for its transportation services and permitted Silencer Central to continue” shipping directly to customers until the final decision on Silencer Central‘s exception request was made. Id. ¶ 41.
“On or about June 2, 2025, despite its recruitment of Silencer Central, its promises about being able to ship Silencers directly to customers, and the months of contract negotiations, FedEx told Silencer Central” that its exception request to deliver Silencers directly to customers was denied. Id. ¶ 42. FedEx also provided notice that Silencer Central “had 30 days from June 2, 2025, to wind down that portion of the business.” Id. Silencer Central sought an additional thirty-day extension until August 2, 2025, for FedEx to continue shipping Silencers directly to customers to allow for Silencer Central to transition to an alternative transportation service. Id. ¶ 43. FedEx denied Silencer Central‘s request citing to “a previous, separate agreement, entitled ‘FedEx Firearms Shipping Compliance Agreement’ (‘2021 Firearms Agreement‘) as one reason for its decision.” Id. ¶ 44.
Silencer Central asserts that it was likely to meet or exceed the volume metrics under the pricing addendums, thereby granting them “significant credits, rebates, and incentives” as part of the TSA based on its historical business activity and shipments made before FedEx terminated the TSA. Id. ¶ 51. Due to FedEx‘s abrupt termination of the TSA, Silencer Central has incurred significant costs in transitioning its nationwide shipping services to a different delivery company at higher rates than Silencer Central had before entering into the TSA. Id. ¶ 52.
For its first cause of action, negligent misrepresentation, Silencer Central asserts that FedEx was negligent in misrepresenting that 1) “it could and would deliver Silencer Central‘s products directly to Silencer Central‘s customers“; 2) “it would not terminate the [TSA] in the first year“; and 3) “that it would not impose surcharges on some of Silencer Central‘s deliveries.” Id. ¶¶ 54-55. Silencer Central alleges that FedEx made these statements without reasonable grounds for believing them to be true and with the intent to induce Silencer Central into entering into the
Silencer Central‘s second claim for breach of contract asserts the TSA is a valid, enforceable contract but not a completely integrated agreement. Id. ¶ 64. Silencer Central alleges FedEx agreed to additional terms outside of the TSA “in writing, specifically agreeing that it would not terminate the [TSA] in the first year and would not impose surcharges on some of Silencer Central‘s delivery services.” Id. ¶ 65. Silencer Central asserts FedEx expressly and impliedly agreed that it would ship Silencers directly to customers, and, in fact, did so from February 24, 2025, to June 2, 2025, under the terms of the TSA. Id. ¶¶ 66-67. The TSA “states that it supersedes all pricing agreement and addenda, if any, between FedEx and [Silencer Central] for the Services, package types, and [Silencer Central] account numbers covered by this Agreement and identified on the respective pricing attachments.” Id. ¶ 68 (cleaned up and citation omitted). Silencer Central contends the prior representations are terms of the TSA, because it “does not contain a merger clause or a complete integration clause that supersedes or excludes prior representations.” Id. ¶ 69. Silencer Central alleges it fully performed under the TSA while FedEx‘s decision to terminate the TSA by refusing to deliver Silencers to customers and imposing surcharges on Silencer Central constitutes a material breach of the TSA. Id. ¶¶ 70-71.
In Count III, Silencer Central brings a promissory estoppel claim. Id. ¶¶ 74-79. Silencer Central alleges that FedEx “promised or manifested an intent” that it would deliver Silencers to Silencer Central‘s customers and would not terminate the TSA in the first year nor impose certain surcharges because FedEx wanted a long-term partnership. Id. ¶¶ 75-76. Silencer Central alleges
II. Legal Standard
To survive a motion to dismiss for failure to state a claim, a complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.”
“Though matters outside the pleadings may not be considered in deciding a Rule 12 motion to dismiss, documents necessarily embraced by the complaint are not matters outside the pleadings.” Zean v. Fairview Health Servs., 858 F.3d 520, 526 (8th Cir. 2017) (internal marks and citation omitted). “In general, materials embraced by the complaint include ‘documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not
III. Discussion
FedEx moved to dismiss Silencer Central‘s claims on two grounds: preemption under the Airline Deregulation Act of 1978 (ADA) and failure to state a claim. Doc. 15. FedEx contends that Silencer Central‘s negligent misrepresentation and promissory estoppel claims are preempted by the ADA and must be dismissed. Id. at 8-12. FedEx concedes that Silencer Central‘s breach-of-contract claim is not preempted by the ADA. FedEx moved to dismiss all claims for failure to state a claim. Id. at 12-24. This Court first addresses ADA preemption as to Silencer Central‘s negligent misrepresentation and promissory estoppel claims, and then addresses FedEx‘s failure to state a claim arguments.
A. ADA Preemption
Counts I and III of the Amended Complaint are claims for negligent misrepresentation and promissory estoppel related to the TSA between Silencer Central and FedEx. Doc. 6 at 10, 13. FedEx contends that these two claims are preempted by the ADA. Doc. 15 at 8-12. FedEx asserts that it is an air carrier as defined by the ADA and that the negligent misrepresentation and
Silencer Central counters that FedEx improperly assumes it qualifies as an “air carrier” under the ADA. Doc. 17 at 14. Silencer Central also asserts that the claims do not relate to a service FedEx provided. Id. at 14-15. Silencer Central contends even if this Court determines that FedEx is an “air carrier” and the claims relate to a service, the claims are not preempted because they are too tenuous, remote, or peripheral to the service. Id. at 15-16.
Under the ADA, “a State . . . may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of an air carrier that may provide air transportation under this subpart.”
In Morales, the Supreme Court of the United States “held that the ADA pre-empted the use of state consumer protection laws to regulate airline advertising . . . recogniz[ing] that the key phrase ‘related to’ expresses a ‘broad pre-emptive purpose.‘” Id. (quoting Morales, 504 U.S. at 383). In American Airlines, Inc. v. Wolens, 513 U.S. 219 (1995), the Supreme Court held the broad interpretation of the ADA preemption provision barred a claim based on the Illinois Consumer Fraud and Deceptive Business Practice Act but not a breach-of-contract claim. Id. at
In Ginsberg, the Supreme Court of the United States addressed whether a customer of an airline frequent flyer program could bring a claim against the airline for breach of the implied covenant of good faith and fair dealing. 572 U.S. at 276. The Court first held “that the phrase ‘other provision having the force and effect of law’ includes common-law claims” and was not limited to state legislation. Id. at 281, 284. The Ginsberg Court next considered whether the “breach of implied covenant claim ‘relates to’ ‘rates, routes, or services.‘” Id. at 284. The Court reasoned that the claim sought reinstatement of the airline‘s frequent flyer program making it related to “rates,” and the claim sought “access to flights and to higher service categories,” which made it related to “services.” Id. The Court finally considered whether the “implied covenant claim [was] based on a state-imposed obligation or simply one that the parties voluntarily undertook.” Id. at 285. The Court deemed the implied covenant a state-imposed obligation because under Minnesota law it applies to “every contract” and “parties cannot contract out of the covenant.” Id. at 287 (citation omitted). Thus, the Ginsberg Court held that the Minnesota implied covenant of good faith and fair dealing claim brought by the airline passenger was preempted by the ADA. Id. at 289-90. The Ginsberg Court nevertheless used language suggestive that a contract-based claim “the parties voluntarily undertook” would not be preempted by the ADA. Id.
Since Ginsberg, the United States Court of Appeals for the Eighth Circuit has had two occasions to consider the ADA‘s preemptive force. In Watson v. Air Methods Corporation, the Eighth Circuit, on rehearing en banc, held “the ADA does not expressly pre-empt [the plaintiff‘s] wrongful-discharge ‘whistleblower’ claim involving post hoc safety reports to the air carrier,” which overruled Botz v. Omni Air International, 286 F.3d 488 (8th Cir. 2002), in relevant part. 870 F.3d 812, 820 (8th Cir. 2017) (en banc). As Watson noted, “some state actions may affect prices, routes, or services in too tenuous, remote, or peripheral a manner to have a pre-emptive effect.” Id. at 817 (quoting Morales, 504 U.S. at 390). The Watson decision reasoned that the wrongful-discharge claim was “too tenuous, remote, or peripheral” because a court would only order reinstatement of an employee, not alter safety practices of the airline; the complaint may start an investigation but would not ground flights; and the wrongful-discharge claim was akin to other employment laws not preempted by the ADA. Id. at 818-19. In overruling Botz, the Eighth Circuit joined the Third, Ninth, and Eleventh Circuits in holding the ADA did not preempt whistleblower claims. Id. at 816, 819-20.
After Watson, the Eighth Circuit considered a putative class action brought by a patient against an air-ambulance provider for 1) a declaration that any contract between the air carrier and class members was unenforceable, 2) deceptive trade practices, and 3) unclean hands. Ferrell v. Air EVAC EMS, Inc., 900 F.3d 602, 603-04 (8th Cir. 2018). The Ferrell Court held that all three claims were preempted by the ADA. Id. at 606-08. In analyzing the unclean hands claim, the
The Eighth Circuit‘s decision in Data Manufacturing, Inc. v. United Parcel Service, Inc. is also informative here because the Federal Aviation Administration Act (FAAAA) has “a substantially similar [preemption] provision” as the ADA. 557 F.3d 849, 852 (8th Cir. 2009). There, a customer brought an action alleging breach of contract, fraudulent and negligent misrepresentation, and money had and received over a dispute on additional charges added to the plaintiff‘s shipping services. Id. at 851. The shipping company moved to dismiss arguing that the FAAAA preempted the customer‘s claims. Id. The Eighth Circuit relied on Morales and Wolens in analyzing the preemptive force of the FAAAA. Id. at 852-854. The Eighth Circuit first determined that the charges were related to the carrier‘s prices and services. Id. at 852. The Eighth Circuit then determined that the plaintiff‘s claims (including negligent misrepresentation), except for the breach of contract claim, were preempted by the FAAAA. Id. at 853-54. In coming to this decision, the Eighth Circuit in Data Manufacturing reasoned that the four claims “arise outside of the four corners of the contract between [the parties], and are claims that are enlarged or enhanced,
In deciding whether Silencer Central‘s common-law claims for negligent misrepresentation and promissory estoppel are preempted by the ADA, this Court must determine whether the state-law claims have a connection with or reference to a price, route, or service of an air carrier; if they do, this Court then must determine whether Silencer Central‘s claims are based on a state-imposed obligation or stem from self-imposed undertakings. See Wolens, 513 U.S. at 228-29; Ginsberg, 572 U.S. at 281-89. The first question is whether FedEx is an “air carrier,” making the ADA applicable to FedEx. An “‘air carrier’ means a citizen of the United States undertaking by any means, directly or indirectly, to provide air transportation.”
The next question is whether Silencer Central‘s negligent misrepresentation and promissory estoppel claims “relate to” FedEx‘s services. Wolens, 513 U.S. at 226. The Eighth Circuit in Watson noted the split across circuits in the definition of “related to” under the ADA. 870 F.3d 812 at 817-18.
Some courts say that it refers only to such things as the frequency and scheduling of air transportation, and to the selection of markets to or from which transportation is provided, while others construe the term more broadly to mean the elements of the contractual arrangement between the airline and the user of the service, including—in the context of commercial airlines—items such as ticketing, boarding procedures, provision of food and drink, and baggage handling, in addition to the transportation itself.
Id. (collecting cases) (cleaned up and citations omitted). The Eighth Circuit went on to assume, albeit without holding, “that the broader meaning is correct,” consistent with the Supreme Court‘s decision in Wolens. Id. (citing Wolens, 513 U.S. at 226). The allegations for the negligent misrepresentation and promissory estoppel claims here—1) misrepresenting the ability to provide a particular form of service, 2) promising not to impose surcharges on that service, and 3) promising not to terminate a service agreement within the first year—each target the economic and operational features of FedEx‘s offered services. See Doc. 6 ¶¶ 54-56. Indeed, at the very heart of the claims is FedEx‘s failure to continue its shipping services and additional costs Silencer Central incurred for such services. As such, the claims here “relate to” FedEx‘s services within the meaning of the ADA‘s preemption clause. See Data Mfg., 557 F.3d at 852 (finding additional charges imposed on shipments related to prices and services of the carrier).
The most difficult question is whether the promissory estoppel claim, as pleaded in the Amended Complaint, is a “state-imposed obligation” or a “contractual commitment voluntarily undertaken.” Wolens, 513 U.S. at 228-29. Promissory estoppel under South Dakota law “may be invoked where a promisee alters his position to his detriment in the reasonable belief that a promise would be performed” and requires “1) the detriment suffered in reliance must be substantial in an economic sense; 2) the loss to the promisee must have been foreseeable to the promisor; and 3) the promisee must have acted reasonably in justifiable reliance on the promise made.” Garrett v. BankWest, Inc., 459 N.W.2d 833, 848 (S.D. 1990) (citations omitted). Promissory estoppel also requires the existence of a “reasonable belief that a promise [will] be performed.” JED Spectrum Inc. v. Stoakes, 24 N.W.3d 108, 123 (S.D. 2025) (quoting Garrett, 459 N.W.2d at 848). The Supreme Court of South Dakota indeed has implied that a promissory estoppel claim requires a promise akin to a “meeting of the minds” and a promise that is more than “vague and uncertain.” Vander Heide v. Boke Ranch, Inc., 736 N.W.2d 824, 834 (S.D. 2007). Silencer Central alleges that FedEx promised to deliver Silencers to customers and not terminate the TSA during the first year or impose certain surcharges. Doc. 6 ¶¶ 75-76. There are some parallels between these South Dakota elements of promissory estoppel, the claims in the Amended Complaint, and the Wolens language exempting from ADA preemption claims for a “contractual commitment voluntarily undertaken.” 513 U.S. at 228-29.
Other courts have allowed similar claims to proceed under the ADA or FAAAA. The Seventh Circuit held that the ADA does not preempt a promissory estoppel claim in ATA Airlines, Inc. v. Federal Express Corporation, 665 F.3d 882, 884 (7th Cir. 2011) (“Promissory estoppel,
B. Failure to State a Claim
1. Breach of Contract
Count II of the Amended Complaint asserts a breach-of-contract claim alleging that FedEx breached the TSA when it terminated the contract by refusing to ship Silencers to customers and imposing surcharges on various shipments. Doc. 6 ¶¶ 63-73. FedEx moved to dismiss the breach-of-contract claim for failure to state a claim. Doc. 15 at 22-24. FedEx contends it did not breach
Under South Dakota law, “[t]he elements of a breach of contract are (1) an enforceable promise; (2) a breach of that promise; and (3) resulting damages.” Bowes Constr., Inc. v. S.D. Dep‘t of Transp., 793 N.W.2d 36, 43 (S.D. 2010) (citing Guthmiller v. Deloitte & Touche, L.L.P., 699 N.W.2d 493, 498 (S.D. 2005)). Silencer Central has stated a viable breach-of-contract claim. Silencer Central alleges that it entered into the TSA, an enforceable contract; that FedEx breached that contract by refusing to ship Silencers directly to customers, imposing surcharges on various shipments, and terminating the agreement in the first year; and that Silencer Central has incurred damages because of FedEx‘s breach. See Doc. 6 ¶¶ 64-73. These allegations, taken as true, establish an enforceable promise, a breach of that promise, and resulting damages, the necessary elements of the claim. See Bowes Constr., Inc., 793 N.W.2d at 43. Thus, Silencer Central has alleged sufficient “factual content that allows the court to draw the reasonable inference that [FedEx] is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citation omitted).
FedEx contends that the alleged conduct could not have breached the TSA because the 2021 Firearms Agreement prohibits FedEx from shipping Silencers to non-FFL holders. Doc. 15 at 22. However, this Court must take as true all factual allegations pleaded in the complaint. See Retro Television Network, 696 F.3d at 768-69. The Amended Complaint specifically alleges that the “[TSA] does not reference or incorporate the 2021 Firearms Agreement,” Doc. 6 ¶ 50, and that the 2021 Firearms Agreement was executed “to conduct its ‘bulk business to business’ shipments,” id. ¶ 45. Indeed, in this Court‘s review of the TSA,3 it could not locate any reference to the prior
2. Promissory Estoppel
Count III of the Amended Complaint asserts a promissory estoppel claim alleging that Silencer Central justifiably relied on FedEx‘s promise to ship Silencers to Silencer Central‘s detriment. Doc. 6 ¶¶ 74-79. FedEx contends that the promissory estoppel claim fails because 1) there is a valid and enforceable contract between the parties, and 2) Silencer Central cannot plead it acted reasonably in justifiable reliance on the alleged promise. Doc. 15 at 20-22. As discussed above, “[p]romissory estoppel may be invoked where a promisee alters his position to his detriment in the reasonable belief that a promise [will] be performed.” JED Spectrum Inc., 24 N.W.3d at
Silencer Central has stated a promissory estoppel claim. Silencer Central alleges that FedEx promised to ship its Silencers directly to its customers and that FedEx would not impose surcharges on such shipments. Doc. 6 ¶¶ 75-76. Silencer Central alleges that it “incurred significant costs and expenses in transitioning its home delivery services to FedEx in reliance on FedEx‘s representations.” Id. ¶ 26. Silencer Central told FedEx that its “efforts associated with the movement to [FedEx] are massive.” Id. ¶ 23. Thus, Silencer Central has alleged a substantial detriment in an economic sense and that this loss was foreseeable to FedEx. Further, Silencer Central alleges that FedEx began shipping Silencers directly to customers under the TSA in February 2025 and did so until June or July 2025. Id. ¶¶ 38-42. In doing so, Silencer Central terminated its prior shipping services, thereby altering its position. Id. ¶ 77. Thus, taking the well-pleaded allegations as true, Silencer Central may have acted reasonably in justifiable reliance on FedEx‘s promise to ship Silencers.
Under the
IV. Conclusion
For the reasons explained above, it is hereby
ORDERED that FedEx‘s Motion to Dismiss, Doc. 14, is granted in part and denied in part. The Motion to Dismiss is granted as to Count I but denied as to Counts II and III.
DATED this 9th day of June, 2026.
BY THE COURT:
ROBERTO A. LANGE
CHIEF JUDGE