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Auto Parts Manufacturing Mississippi Inc. v. King Construction of Houston, LLC

United States District Court, N.D. Mississippi, Aberdeen Division

March 24, 2014

AUTO PARTS MANUFACTURING MISSISSIPPI INC., a Mississippi corporation, Plaintiff,
v.
KING CONSTRUCTION OF HOUSTON, LLC, a Mississippi limited liability company; NOATEX CORPORATION, a California corporation; and KOHN LAW GROUP, INC., a California corporation, Defendants.

MEMORANDUM OPINION

GLEN H. DAVIDSON, Senior Judge.

Presently before the Court are several motions in the case sub judice: Defendant King Construction of Houston, LLC's motion for summary judgment [145]; Defendant Noatex Corporation's motion to dismiss [161]; Defendant King Construction of Houston, LLC's motion to strike [192] response and exhibits by Defendants Noatex Corporation and Defendant Kohn Law Group, Inc. to the motion for summary judgment and for an order prohibiting Robert Kohn from further participation in this action; and Defendant Kohn Law Group, Inc.'s motion to dismiss [210].[1] Upon due consideration, the Court finds as follows.

A. Factual and Procedural History

Auto Parts Manufacturing Mississippi, Inc. ("APMM") contracted with Noatex Corporation ("Noatex") for Noatex to construct an auto parts manufacturing facility in Guntown, Lee County, Mississippi, near Toyota Motor Manufacturing, Mississippi, Inc. in Blue Springs, Mississippi. Noatex subcontracted with King Construction of Houston, LLC ("King Construction"), a Mississippi limited liability company, to provide some materials and labor for the construction. Noatex alleges that APMM owes it money for goods and services that Noatex provided to APMM under the contract. Noatex questions some of the invoices submitted to it by King Construction pertaining to the subcontract work. In response to this billing dispute between Noatex and King Construction, King Construction notified APMM on September 23, 2011, pursuant to Mississippi's "Stop Notice" Statute, Mississippi Code § 85-7-181 (the "Stop Notice statute"), that Noatex owed King Construction $260, 410.15 and that King Construction was filing a "Laborer's and Materialman's Lien and Stop Notice" in the Chancery Court of Lee County, Mississippi. On the date of notification, APMM owed Noatex $179, 707.40. The stop notice bound the disputed funds in APMM's hands to secure invoice claims that Noatex allegedly owed to King Construction. See MISS. CODE ANN. § 85-7-181 ("[T]he amount that may be due... shall be bound in the hands of such owner for the payment in full...."). King Construction's filing of the stop notice in the lis pendens record of the chancery court had the effect of establishing King Construction's lien priority over the property that was the subject of the dispute. See id. § 85-7-197. APMM later deposited the $260, 410.15 into the registry of the Chancery Court of Lee County.

The dispute resulted in three lawsuits, one of which is the case subjudice. [2] APMM filed this interpleader action in the Chancery Court of Lee County to determine ownership of the disputed funds subject to King Construction's stop notice, naming both Noatex and King Construction as defendants. In December of 20 II, Noatex removed this interpleader action to this Court. APMM deposited the money into the Court registry. Subsequently, APMM filed an amended complaint in interpleader [135] naming Kohn Law Group, Inc. ("Kohn Law Group") as an additional defendant. The interpleaded funds are currently impounded in the Court registry pending disposition.

On May 6, 2013, King Construction filed a motion for summary judgment [145]; Noatex and Kohn Law Group jointly filed a response. On May 13, 2013, Noatex filed a motion to dismiss [161] the interpleader action for failure to state a claim; APMM filed a response; and Noatex and Kohn Law Group jointly filed a reply. On May 27, 2013, King Construction filed a motion to strike [192] the response to its summary judgment motion jointly filed by Noatex and Kohn Law Group, and also requested that the Court enter an order prohibiting attorney Robert Kohn from further participation in this action; Noatex and Kohn Law Group jointly filed a response in opposition. Finally, on June 20, 2013, Kohn Law Group filed a motion to dismiss [210] the interpleader action for failure to state a claim; APMM filed a response; and Noatex and Kohn Law Group jointly filed a reply. These matters are now ripe for review.

B. Rule 12(b)(6) Motion to Dismiss Standard

In order to survive a Rule 12(b)(6) motion to dismiss, a complaint, viewed in the light most favorable to the plaintiff, must be "plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (internal quotation marks omitted». "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id., 129 S.Ct. 1937. Detennining the reasonableness of such an inference is "a context-specific task that requires the... court to draw on its judicial experience and common sense." Id. at 679, 129 S.Ct. 1937. While a court must accept all of the plaintiffs allegations as true, it is not bound to accept as true "a legal conclusion couched as a factual allegation." Twombly, 550 U.S. at 555, 127 S.Ct. 1955 (quoting Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986)). If the facts fail to "nudge [the] claims across the line from conceivable to plausible, [then the] complaint must be dismissed." Id. at 570, 127 S.Ct. 1955. On a Rule 12(b)(6) review, the court may consider "documents attached to or incorporated in the complaint and matters of which judicial notice may be taken." United States ex rel. Willard v. Humana Health Plan of Tex. Inc., 336 F.3d 375, 379 (5th Cir. 2003) (citing Lovelace v. Software Spectrum Inc., 78 F.3d 1015, 1017-1018 (5th Cir. 1996)).

C. Rule 56 Motion for Summary Judgment Standard

Summary judgment "should be rendered if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). See FED. R. CIV. P. 56(a); Weaver v. CCA Indus., Inc., 529 F.3d 335, 339 (5th Cir. 2008). The rule "mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a sufficient showing to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp., 477 U.S. at 322, 106 S.Ct. 2548.

The party moving for summary judgment bears the initial responsibility of informing the court of the basis for its motion and identifying those portions of the record it believes demonstrate the absence of a genuine dispute of material fact. Id. at 323, 106 S.Ct. 2548. Under Rule 56(a), the burden then shifts to the nonmovant to "go beyond the pleadings and by... affidavits, or by the depositions, answers to interrogatories, and admissions on file, ' designate 'specific facts showing that there is a genuine issue for trial.'" Id. at 324, 106 S.Ct. 2548; Littlefield v. Forney Indep. Sch. Dist., 268 F.3d 275, 282 (5th Cir. 2001); Willis v. Roche Biomedical Labs., Inc., 61 F.3d 313, 315 (5th Cir. 1995).

D. Analysis and Discussion

Upon due consideration, the Court finds that for the reasons stated below the allegations in the amended complaint pertaining to Kohn Law Group must be dismissed and Kohn Law ...


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