Limited v. Light & Motion Industries

Background

Multi-Flex designs and manufactures printed circuit boards. Elecsys provides electronics manufacturing services involving assembly, testing, packaging, and distribution of electronic parts. Light & Motion Industries, Inc. sells lights and related equipment marketed for bicycles, underwater diving, and photography.

Light & Motion had ordered printed circuit boards from Multi-Flex for more than a decade. The plaintiffs alleged that Light & Motion increasingly fell behind on payments. Multi-Flex alleged that Light & Motion owed $681,393, plus interest, for electronic and lighting parts that Multi-Flex shipped. Elecsys alleged that Light & Motion owed $583,229 for parts Elecsys purchased at Light & Motion’s specific request in anticipation of future shipments. The amended complaint included purchase orders, invoices, Multi-Flex’s standard conditions of sale, and a list of goods and materials purchased by Elecsys.

Claims and Legal Standard

Multi-Flex asserted a written-contract claim and a common-count claim. Elecsys asserted a common-count claim. A common count is a simplified claim for money allegedly owed, generally requiring an alleged debt in a specific amount, the goods or other consideration supporting the debt, and nonpayment.

Light & Motion moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which permits dismissal when a complaint does not state a legally recognized claim or does not provide enough facts to make the claim plausible. The court treated the factual allegations as true for purposes of the motion.

Written-Contract Claim

Light & Motion argued that the amended complaint did not identify the specific contractual obligations that were breached or explain how the attached conditions of sale, purchase orders, and invoices related to one another. Multi-Flex argued in its opposition that the United Nations Convention on Contracts for the International Sale of Goods, rather than California law, governed the claim.

The court concluded that the amended complaint pleaded the contract claim under California law. The court noted that the complaint and earlier filings did not refer to the Convention, and that plaintiffs’ counsel acknowledged at the hearing that the amended complaint had not been pleaded under it. Because Multi-Flex did not argue that the claim was adequately pleaded under California law, the court granted dismissal of the written-contract claim with prejudice.

The court stated, however, that the dismissal was without prejudice to filing a motion under Federal Rule of Civil Procedure 16 to amend the pleading to add a contract claim under the Convention.

Multi-Flex’s Common-Count Claim

Light & Motion argued that Multi-Flex’s common-count claim duplicated the contract claim and should therefore be dismissed. The court denied that part of the motion. It found that Multi-Flex’s allegation that Light & Motion owed $681,393 for goods sold and delivered, together with the attached purchase orders and invoices, provided sufficient notice and adequately supported the claim.

Elecsys’s Common-Count Claim

Light & Motion argued that Elecsys’s claim was vague and conclusory. The court agreed that the amended complaint did not provide enough concrete facts. Although the complaint alleged that Light & Motion requested that Elecsys source parts and that Elecsys purchased goods at Light & Motion’s request, the court found that the attached exhibit was not understandable and that additional facts were needed.

The court required Elecsys to describe or attach materials identifying the specific requests, the specific goods, services, or expenses supporting the claim, and the specific points when Light & Motion became indebted to Elecsys. The court dismissed Elecsys’s common-count claim with leave to amend because plaintiffs’ counsel represented that plaintiffs could allege additional specific facts.

Order

Judge Beth Freeman ordered that Light & Motion’s motion to dismiss be granted in part and denied in part. Specifically:

- Multi-Flex’s written-contract claim was dismissed with prejudice, subject to the stated possibility of a Rule 16 motion to add a contract claim under the Convention. - The motion to dismiss Multi-Flex’s common-count claim was denied. - Elecsys’s common-count claim was dismissed with leave to amend. - Plaintiffs could file an amended complaint by December 4, 2025. The order stated that failing to meet the deadline or cure the identified deficiencies would result in dismissal of plaintiffs’ claims with prejudice. Plaintiffs could not add parties or claims without the court’s express approval or a stipulation of all parties.