The opinion of the court was delivered by: Varlan/shirley
This civil action is before the Court on defendants' Motion to Dismiss [Doc. 7], in which defendants argue that this lawsuit should be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted. Plaintiffs have responded in opposition to the pending motion [Doc. 10], and defendants have filed a reply [Doc. 12], thereby making this matter ripe for adjudication. For the reasons set forth below, the Court will deny defendants' motion to dismiss.
As the Court is required to do on a motion to dismiss under Fed. R. Civ. P. 12(b)(6), the Court will construe the complaint [Doc. 1] in the light most favorable to plaintiffs, accept all well-pleaded factual allegations as true, and determine whether plaintiffs can prove no set of facts in support of their claims that would entitle them to relief. Trzebuckowski v. City of Cleveland, 319 F.3d 853, 855 (6th Cir. 2003).
Plaintiffs, Charles Bozeman and Joe Zappa, and defendants, Eric Meyers and James Vodenicker, along with other individuals, were limited partners in Highway 66, a Tennessee limited partnership formed on or about May 2, 1995. [Doc. 1 at ¶¶ 1, 6.] Highway 66 was formed pursuant to a Limited Partnership Agreement ("LP Agreement") [Doc. 5, Att. 2], with the purpose of the limited partnership being "the management, leasing, operation, and ownership of a music theater in Sevier County, Tennessee," [Id. at § 3, p. 1], the Lee Greenwood Theater. [Doc. 1 at ¶ 8.] In order to finance the limited partnership, two loans were obtained from Branch Banking and Trust Company ("BB&T"), one in the amount of $898,381.65 and the other in the amount of $3,101,568. [Doc. 1 at ¶ 9.] These loans ("BB&T Loans") were personally guaranteed by each limited partner, including plaintiffs and defendants, through their signing of guaranty agreements which made them jointly and severally liable for the debt incurred through the BB&T Loans. [Id. at ¶ 10; Doc. 8 at 2.]
On June 23, 2003, BB&T instituted foreclosure proceedings against the Lee Greenwood Theater on account of nonpayment of the BB&T Loans. [Doc. 1 at ¶ 12.] As a result, that property was sold at a foreclosure sale and the limited partners were released from their personal guarantees of the BB&T Loans. [Id.]
Some time before the Lee Greenwood Theater was foreclosed upon, the limited partners loaned $1,414,010 to the limited partnership. [Doc. 1 at ¶ 13.] Plaintiffs' complaint does not expressly state why or when the limited partners were requested to make this loan to the partnership, but notes that "[d]uring the course of the BB&T Loans, it became necessary for the limited partners to loan money to Highway 66 in order for Highway 66 to make payments to BB&T and to pay for other expenses." [Id. at ¶ 11.] Defendants, however, did not contribute to this amount. [Id. at ¶¶ 13-15.] As a result, plaintiffs state that "every other limited partner was forced to pay an amount in excess of his pro rata share." [Id. at ¶ 13.] Defendants state that they "did not continue to make capital contributions or loans to Highway 66 beyond a certain time consistent with and pursuant to the terms and provisions of Section 6 of the L.P. Agreement."*fn1 [Doc. 8 at 3.]
As a result of defendants' refusal to pay any portion of the $1,414,010 amount, plaintiffs filed suit in this Court on November 21, 2006, seeking contribution "so that the Plaintiffs are reimbursed for payments they made to Highway 66 in excess of their pro rata share." [Doc. 1 at ¶ 17.] Defendants then simultaneously filed their answer and the pending motion to dismiss, arguing that because they were not "personally liable for any portion of the debts to Highway 66 except pursuant to the aforesaid Guaranty Agreements [entered into with BB&T]," [Doc. 8 at 3], plaintiffs are barred from seeking contribution from them for their share of the $1,414,010 amount and that the complaint therefore fails to state a claim upon which relief can be granted.
Defendants have moved to dismiss the plaintiffs' claims pursuant to Fed. R. Civ. P. 12(b)(6). A motion to dismiss for failure to state a claim pursuant to Fed. R. Civ. P. 12(b)(6) should not be granted "unless it appears beyond a doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957). All well-pleaded allegations must be taken as true and be construed most favorably toward the non-movant. Trzebuckowski, 319 F.3d at 855. While a court may not grant a Rule 12(b)(6) motion based on disbelief of a complaint's factual allegations, Lawler v. Marshall, 898 F.2d 1196, 1199 (6th Cir. 1990), the court "need not accept as true legal conclusions or unwarranted factual inferences." Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987). The issue is not whether the plaintiff will prevail, but whether the claimant is entitled to offer evidence to support his or her claim. Chapman v. City of Detroit, 80 F.2d 459, 465 (6th Cir. 1986). Consequently, a complaint will not be dismissed pursuant to Rule 12(b)(6) unless there is no law to support the claims made, the facts alleged are insufficient to state a claim, or there is an insurmountable bar on the face of the complaint.
Defendants argue that, because the amount for which plaintiffs seek contribution from defendants was not a result of monies paid or disbursed directly to BB&T as repayment of the personally guaranteed BB&T Loans, plaintiffs are barred from seeking contribution from them for their prorata share of the $1,414,010 amount. [Doc. 8.] Plaintiffs contend that the $1,414,010 amount was paid to the limited partnership in order to pay BB&T and discharge the partnership debt arising from the BB&T loan, [Doc. 11 at 2], and argue that "[i]t would be unjust and inequitable for Defendants to avoid paying their share of the debts paid off by Plaintiffs and the other limited partners merely because payment to the bank came through the office of the limited partnership." [Id. at 6.]
Under Tennessee law, a claim for contribution can be brought: when one of several parties jointly liable for a common debt pays more than his or her share to discharge the debt for the benefit of all. Once a person has paid more than his or her fair share of a common debt, he or she may use an action for contribution as a vehicle ...