Cruz v. Media

Background

Defendants Townsquare Media, Inc., Townsquare Interactive, LLC, and Tim Pirrone moved under Federal Rule of Civil Procedure 12(b)(6) and Rule 9(b) to dismiss Jonathan Cruz and Cruz Collaborative Architecture, LLC’s First Amended Complaint. Rule 12(b)(6) requires dismissal when a complaint does not state a legally sufficient claim. Rule 9(b) requires fraud to be pleaded with particularity, including the who, what, when, where, and how of the alleged misconduct.

The court described a history of missed deadlines and failures to comply with court orders. In an earlier related proceeding, the court had dismissed the case without prejudice for failure to prosecute and later allowed the plaintiffs to amend after granting the defendants’ motion to dismiss. The plaintiffs filed their First Amended Complaint three days late. They also filed multiple versions of a redlined amended complaint, did not timely pay a $1,000 sanction ordered at a case-management conference, and did not timely oppose the defendants’ current motion to dismiss. Their opposition was filed 20 days late, which they attributed to an internal calendaring error.

Failure to Prosecute

The court applied Rule 41(b), which permits dismissal when a plaintiff fails to prosecute the case or comply with a court order. It considered the public interest in resolving litigation promptly, the court’s need to manage its docket, prejudice to the defendants, the policy favoring decisions on the merits, and whether less severe sanctions were available. The court found that the repeated delays prejudiced the defendants, increased litigation costs, interfered with case management, and showed that lesser sanctions would be futile because the plaintiffs still had not complied with the prior $1,000 sanction order.

Claims in the First Amended Complaint

The court separately reviewed the claims and found that they remained deficient even apart from the plaintiffs’ litigation delays:

- Breach of contract: The plaintiffs did not identify the contract provisions that Townsquare Interactive allegedly breached or explain specifically how the defendants breached them. The court dismissed the first claim. - Breach of the implied covenant of good faith and fair dealing: The plaintiffs alleged that the defendants prematurely launched the website, withheld administrative access, stopped communicating, and used control over the domain to frustrate the plaintiffs’ rights. The court found that the amended complaint did not provide facts showing that the defendants acted in bad faith or that the agreement required the conduct the plaintiffs described. The court dismissed the second claim. - Fraudulent deceit and promissory fraud: The plaintiffs alleged that Townsquare promised a professionally completed website, implemented revisions, and full administrative access, while knowing those representations were false or making them recklessly. The court found that the allegations did not explain how the defendants knew the representations were false and did not satisfy Rule 9(b). The court dismissed the third and fourth claims. - Intentional infliction of emotional distress: The court found that the claim improperly repackaged the alleged contract breach and that the plaintiffs did not clearly plead facts satisfying the claim’s elements. The court dismissed the fifth claim. - Slander of title and wrongful lien: The amended complaint did not identify any title involved in the case and did not meet the basic pleading requirements. The court dismissed the sixth claim. The court also noted that the plaintiffs did not address this claim in their opposition.

Disposition

Judge William H. Orrick granted the defendants’ motion to dismiss and dismissed the action with prejudice under Rule 41(b), also concluding that the First Amended Complaint failed to state claims on which relief could be granted. The court vacated all upcoming deadlines and hearing dates and ordered the plaintiffs to pay the $1,000 sanction to the defendants immediately.