The opinion of the court was delivered by: Robert F. Kelly, Sr. J.
Presently before the Court is the Motion to Dismiss Pursuant to Federal Rules of Civil Procedure 12(b)(3) and 12(b)(6), or in the Alternative, to Transfer Venue to the United States District Court for the District of New Jersey filed by Defendants Matrix Golf & Hospitality Philadelphia, LLC, et al. For the reasons that follow, the Motion is denied.
Plaintiff Stanley H. Engle ("Engle") is a citizen of Florida, who additionally maintains two residences in Bryn Mawr, Pennsylvania. Defendant Matrix Golf & Hospitality Philadelphia, LLC ("Matrix Philadelphia") is a New Jersey limited liability company, which owns and manages golf clubs in Pennsylvania. Defendant Matrix Golf & Hospitality Services, LLC ("Matrix GHS") is a New Jersey limited liability company and a member and manager of Matrix Philadelphia. Defendant Taylor/Epstein Investment Fund, LLC ("Taylor/Epstein") is a New Jersey limited liability company, which is a member and manager of Matrix GHS. Defendant Matrix/Ashbourne Management Corp. ("Matrix/Ashbourne") is a Pennsylvania limited liability company. Defendant Matrix Development Group, Inc. ("Matrix Development") is a New Jersey corporation and an affiliate of and/or in control of Matrix Philadelphia, Taylor/Epstein, Matrix GHS, and Matrix/Ashbourne Associates, LP. Defendant Matrix/Ashbourne Associates, LP is a Pennsylvania limited partnership. Defendant The Fairways at Cedarbrook Hills, LP ("Fairways at Cedarbrook Hills") is a Pennsylvania limited partnership. Defendant Cedarbrook Fairways Development, LLC ("Cedarbrook Fairways") is a Pennsylvania limited liability company, having as its sole member Taylor/Epstein.*fn1 Defendants Joseph S. Taylor ("Taylor") and Donald M. Epstein ("Epstein") are residents of New Jersey and officers and shareholders of Matrix Development and other Matrix Defendants.
The allegations of Engle's Complaint stem from a series of loans that Engle made to Matrix Philadelphia from September 2000 to February 2002. The first of these loans took place in September 2000, when Engle loaned Matrix Philadelphia $2,700,000.00. On September 25, 2000, Matrix Philadelphia executed a Promissory Note evidencing its obligation to pay the principal balance of the loan, $2,700,000.00, plus interest. On May 15, 2001, Engle made a second loan to Matrix Philadelphia in the amount of $450,000.00. On February 10, 2002, Engle made a third loan to Matrix Philadelphia, this time in two installments, with one loan in the amount of $600,000.00, and the other in the amount of $200,000.00. Matrix Philadelphia is currently in default on these loans, and as a result, Engle filed suit in this Court on December 15, 2008, seeking to recover more than $3,950,000.00 from the Matrix Defendants, Taylor, and Epstein.
Engle contends that Matrix Development, Taylor/Epstein, Matrix GHS, Taylor, and Epstein controlled Matrix Philadelphia and that all of the Matrix Defendants are alter egos of one another. In support of this contention, Engle alleges that all persons involved in the management of Matrix Philadelphia were also employees of Matrix Development, Taylor/Epstein, or Matrix GHS, and that the Matrix Defendants had common members, shareholders, and officers.
The Complaint alleges that the Matrix Defendants, through their control over the operations of Matrix Philadelphia, caused Matrix Philadelphia to transfer its funds to other Matrix affiliates, and thereby, caused it to be unable to repay the loans Engle had made to it when those affiliates could not make payments to Matrix Philadelphia. According to Engle, Matrix Development, Taylor/Epstein, Matrix GHS, Taylor, and Epstein structured Matrix Philadelphia so that its income relied solely on the receipt of funds from other Matrix affiliates. Matrix Philadelphia, under the control of Matrix Development, Taylor/Epstein, Matrix GHS, Taylor, and Epstein loaned the money it had borrowed from Engle to Matrix/Ashbourne and Matrix CBH, for use at the Ashbourne and Cedarbrook Hills Country Clubs. Matrix/Ashbourne and Matrix CBH agreed to pay management fees to Matrix Philadelphia for Matrix Philadelphia's management of the two country clubs. The payment of these fees and the repayment of the loans made to Matrix/Ashbourne and Matrix CBH was Matrix Philadelphia's sole source of income. However, according to Engle, Matrix Development, Taylor/Epstein, Matrix GHS, Taylor, and Epstein caused Matrix/Ashbourne and Matrix CBH to transfer assets and to take on debts to other Matrix affiliates without the assets necessary to do so. Specifically, Engle alleges that in September 2005, Matrix Development, Taylor/Epstein, Matrix GHS, Matrix/Ashbourne, Taylor, and Epstein caused Matrix CBH to transfer property and assets to Fairways at Cedarbrook (the "Cedarbrook Transaction"), knowing that Matrix CBH did not have the necessary funds to make this transfer and still pay its dues to Matrix Philadelphia. Engle asserts that, in so doing, the Matrix Defendants placed their own interests before those of Engle and other creditors and acted with an intent to defraud.
In Counts I through IV of his Complaint, Engle asserts claims against the Matrix Defendants, Taylor, and Epstein for breach of contract relating to each of the four loans Engle made to Matrix Philadelphia. Count V asserts a claim against the Matrix Defendants, Taylor, and Epstein for breach of the duty of good faith and fair dealing. Count VI asserts a claim for breach of fiduciary duty. Count VII asserts a claim for fraudulent transfer relating to the Cedarbrook Transaction. Defendants filed a Motion to Dismiss Engle's Complaint on February 12, 2009. The Matrix Defendants seek dismissal of all Matrix affiliates, with the exception of Matrix Philadelphia, on the grounds that the remaining affiliates were not parties to the loan agreements made between Engle and Matrix Philadelphia. The Defendants further seek dismissal of Counts V through VII of the Complaint for failure to state a claim upon which relief can be granted. Alternatively, if this Court declines to dismiss Engle's Complaint, Defendants ask that this Court transfer the matter to the District of New Jersey.
Rule 12(b)(3) allows a party to present, by motion, the defense of improper venue. Fed. R. Civ. P. 12(b)(3). 28 U.S.C. § 1406(a) provides that "the district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought." Where federal jurisdiction is founded upon diversity of citizenship, venue is proper in "a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred."
When deciding whether to grant a Rule 12(b)(6) Motion to Dismiss, this Court must accept as true all well-pleaded allegations in the Complaint, and view them in a light most favorable to the plaintiff. Doe v. Delie, 257 F.3d 309, 313 (3d Cir. 2001). Therefore, Defendant's Motion will be granted only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations. Id. Nonetheless, a plaintiff must plead specific factual allegations. Neither "bald assertions" nor "vague and conclusory allegations" must be accepted as true. See Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir. 1997); Sterling v. Se. Pa. Transp. Auth., 897 F. Supp. 893 (E.D. Pa. 1995).
In their Reply Brief to Engle's Memorandum in Opposition to Defendant's Motion to Dismiss, Defendants asserted that this Court lacked subject matter jurisdiction over this action due to Engle's failure to properly allege citizenship in the Complaint. This Court allowed leave to amend the Complaint. Engle filed an Amended Complaint on March 24, 2009, wherein he has properly pled that he is a citizen of Florida. As Defendants are citizens of Pennsylvania and New Jersey, this Court has subject matter ...