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Aci Worldwide Corp. v. Mastercard Technologies, LLC

United States District Court, D. Nebraska

December 31, 2014



LAURIE SMITH CAMP, Chief District Judge.

This matter is before the Court on the Motion to Dismiss (Filing No. 59) submitted by Defendants MasterCard Technologies, LLC ("MasterCard Tech") and MasterCard International, Inc.'s ("MasterCard Int'l") (collectively "Defendants"). For the following reasons, the Defendants' Motion will be granted in part.


For purposes of the pending motion, the Plaintiff's well-pled facts are accepted as true, though the Court need not accept proposed conclusions of law. The following is a summary of the Plaintiff's factual allegations in the Amended Complaint (Filing No. 48).

Plaintiff ACI Worldwide Corp. ("ACI") alleges that Defendants disclosed confidential information regarding ACI's NET24-XPNET middleware ("XPNET") to Baldwin Hackett & Meeks, Incorporated ("BHMI"). ACI presents nine theories of recovery: breach of contract, misappropriation of trade secrets, fraud, breach of the duty of good faith and fair dealing, unjust enrichment, tortious interference with business relations and expectations, conversion, trespass to chattels, and civil conspiracy.

MasterCard Tech provides transaction processing, telecommunications, and related services to MasterCard Int'l for the benefit of the members and customers of MasterCard Int'l. MasterCard Int'l provides payment processing services between merchant banks and purchasers' card-issuing banks for purchases using "MasterCard" brand debit or credit cards. ACI provides and markets a broad, integrated suite of electronic payment software, and also powers electronic payments for hundreds of financial institutions, retailers, and processors around the world. Starting in 1994 or earlier, ACI licensed to Defendants a variety of software, including XPNET. Thereafter, Defendants disclosed ACI's proprietary intellectual property ("ACI's IP") to BHMI, and Defendants and BHMI replicated XPNET.

In mid-2010, MasterCard Int'l notified ACI that it would not renew its license for use of XPNET. Less than three months later, Defendants publically announced their switch to BHMI's middleware product known as Concourse-Transaction Messaging System ("TMS"). In July 2011, ACI concluded that BHMI used ACI's IP to develop TMS.


On August 26, 2014, ACI filed its Amended Complaint (Filing No. 48) with this Court. Prior to filing this action, ACI initiated a proceeding in Nebraska state court against BHMI (the "Nebraska State Action") regarding BHMI's alleged use of confidential information to develop TMS. (Def. Br. in Support of Mot. to Dismiss Am. Compl, Filing No. 60 at ECF 4 (citing ACI Worldwide Corp. v. BHMI, Inc., et al., No. CI 12-9038 (District Court of Douglas County, Nebraska) (J. Russell Derr, District Court Judge)).) The Nebraska State Action went to trial in August of 2014. ( Id. ) The jury rendered a verdict in ACI's favor on the misappropriation of trade secret claims. ( Id. ) Defendants then filed this motion to dismiss ACI's action in this Court due to ACI's failure to join a necessary party pursuant to Federal Rule of Civil Procedure 12(b)(7), and ACI's failure to state a claim upon which relief can be granted, pursuant to Federal Rule of Civil Procedure 12(b)(6). Defendants' 12(b)(6) motion applies to ACI's claims for fraud, breach of duty of good faith and fair dealing, unjust enrichment, tortious interference with business relations and expectations, conversion, trespass to chattels, and civil conspiracy.


I. Fed.R.Civ.P. 12(b)(7), Failure to Join a Party

When deciding a motion to dismiss under Federal Rule of Civil Procedure 12(b)(7) for failure to join a party under Rule 19, the court must first determine whether the absent party is a "necessary party" under Rule 19(a). Baker Grp., L.C. v. Burlington N. & Santa Fe Ry. Co., 451 F.3d 484, 490 (8th Cir. 2006) (citing Fed.R.Civ.P. 19(a)). If a party is necessary under Rule 19(a), that party must be joined if feasible. See id. If the court determines that an absent party is not necessary, then the case must go forward without that party, and there is no need to determine whether joinder is feasible under Rule 19(b). Id. at 491. Dismissal based on failure to join a party is only proper in cases where the absent party is necessary, joinder is not feasible, and the absent party is indispensable. See Provident Tradesmens Bank & Trust Co. v. Patterson, 108 (1968).

II. Fed.R.Civ.P. 12(b)(6), 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." Fed.R.Civ.P. 8(a)(2). "[A]lthough a complaint need not include detailed factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.'" C.N. v. Willmar Pub. Sch., Indep. Sch. Dist. No. 347, 591 F.3d 624, 629-30 (8th Cir. 2010) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). "Instead, the complaint must set forth enough facts to state a claim to relief that is plausible on its face.'" Id. at 630 (citing Twombly, 550 U.S. at 570).

"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." Ritchie v. St. Louis Jewish Light, 630 F.3d 713, 716 (8th Cir. 2011) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)) (internal quotation marks omitted). "Courts must accept... specific factual allegations as true but are not required to accept... legal conclusions." Outdoor Cent., Inc. v., Inc., 643 F.3d 1115, 1120 (8th Cir. 2011) (quoting Brown v. Medtronic, Inc., 628 F.3d 451, 459 (8th Cir. 2010)) (internal quotation marks omitted). "A pleading that merely pleads labels and conclusions, ' or a formulaic recitation' of the elements of a cause of action, or naked assertions' devoid of factual enhancement will not suffice." Hamilton v. Palm, 621 F.3d 816, 817-18 (8th Cir. 2010) (quoting Iqbal, 556 U.S. at 678). The complaint's factual allegations must be "sufficient to raise a right to relief above the speculative level.'" Williams v. Hobbs, 658 F.3d 842, 848 (8th Cir. 2011) (quoting Parkhurst v. Tabor, 569 F.3d 861, 865 (8th Cir. 2009)).

When ruling on a defendant's motion to dismiss, a judge must rule "on the assumption that all the allegations in the complaint are true, " and "a well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and that a recovery is very remote and unlikely.'" Twombly, 550 U.S. at 555 & 556 (quoting Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)). The complaint, however, must still "include sufficient factual allegations to provide the grounds on which the claim rests." Drobnak v. Andersen Corp., 561 F.3d 778, 783 (8th Cir. 2009).

"Two working principles underlie... Twombly. First, the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 555). "Second, only a complaint that states a plausible claim for relief survives a motion to dismiss." Id. at 679 (citing Twombly, 550 U.S. at 556). "Determining whether a complaint states a plausible claim for relief will... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id.


I. Motion to Dismiss for Failure to Join BHMI

Under Federal Rule of Civil Procedure 19(a), a party is "necessary" if:

(A) in that person's absence, the court cannot accord complete relief among existing parties; or
(B) that person claims an interest relating to the subject of the action and is so situated that disposing of the action in the person's absence may:
(i) as a practical matter impair or impede the person's ability to protect the interest; or
(ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest.

Fed. R. Civ. P. 19(a)(1). If the party is "necessary, " subject to service of process, and joinder would not deprive the Court of subject matter jurisdiction, then "the court must order that the person be made a party." Fed.R.Civ.P. 19(a)(1), (2).

A. Fed.R.Civ.P. 19(a)(1)(A): Complete Relief Among Existing Parties

While a decision by a court is not binding on nonparties, see Parklane Hosiery Co., Inc., v. Shore, 439 U.S. 322, 327 n. 7 ("It is a violation of due process for a judgment to be binding on a litigant who was not a party or a privy and therefore has never had an opportunity to be heard."), Rule 19(a)(1)(A) asks whether "the court cannot accord complete relief among the existing parties ...." Fed.R.Civ.P. 19(a)(1)(A) (emphasis supplied); see also Davis Cos. v. Emerald Casino, Inc., 268 F.3d 477, 484 (7th Cir. 2001) ("[T]he term complete relief' refers only to relief between the persons already ...

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