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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND BARON FINANCIAL CORP. Plaintiff V. * RONY NATANZON, et al., Defendants * * * * * * * * * * * * * * * * CIVIL NO. SKG-03-3563

MEMORANDUM OPINION Pending before the Court is Plaintiff-Counter Defendant, Baron Financial Corporation's ("Baron") and Third-Party Defendant, Samuel Buchbinder's ("Buchbinder") Motion to Dismiss, or in the Alternative for Summary Judgment, as to CounterPlaintiff/Third Party Plaintiff Rony Natanzon's ("Natanzon") Counterclaim and Third-Party Complaint ("Counterclain"). No. 87). The issue is fully briefed. (Paper

No hearing is necessary.

Local Rule 105.6.

Two counts remain before the Court: Count I

(Intentional Interference with Economic Interests) and Count IV (unfair competition).1 For the reasons discussed below, the

Court hereby GRANTS Baron and Buchbinder's motion and dismisses Natanzon's counterclaim with prejudice. I. Background ERN, LLC ("ERN") and Natanzon jointly filed the counterclaim
Natanzon concedes that he lacks standing to bring Count II and Count III. As a result, Count II and III are hereby dismissed, with prejudice, as to Natanzon.
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against Baron and Buchbinder on February 25, 2004. 2004, ERN filed for bankruptcy.

On April 28,

Pursuant to Section 362 of the

bankruptcy code, all proceedings therein regarding ERN were stayed. (Paper No. 28). A bankruptcy trustee was appointed for

ERN on May 24, 2004.

Baron and Buchbinder have moved to dismiss

the counterclaim only as to Natanzon. In evaluating a motion to dismiss, the unwavering focus of the Court must necessarily be on the language and content of the counterclaim. A careful reading of the counterclaim demonstrates

the gravamen of the complaint are actions against and damages to ERN. References to actions affecting Natanzon as separate from

his role in ERN and damages to Natanzon separate from his role in ERN are few and largely subsidiary. Thus, careful scrutiny of

the actions and damages alleged against Natanzon does not yield any viable claims of Natanzon. II. Analysis Baron and Buchbinder argue that plaintiff does not have standing to bring his claim for tortious interference or unfair competition claim. In the alternative, Baron and Buchbinder

argue that Natanzon failed to state a claim on which relief can be granted. They allege that the claim for tortious interference

should be dismissed because Buchbinder and Baron are parties to the underlying MOU/Rider business relationship, and because Natanzon failed to allege that the conduct complained of was

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wrongful.

Moreover, Baron and Buchbinder allege that the unfair

competition claim should be dismissed because the conduct complained of does not support a claim for "unfair competition." The Court largely agrees with Baron and Buchbinder's arguments. A. Standard of Review When the legal sufficiency of a complaint is challenged under a Rule 12(b)(6) motion, the court assumes "the truth of all facts alleged in the complaint and the existence of any fact that can be proved, consistent with the complaint's allegations." Eastern Shore Mkts. v. J.D. Assocs. Ltd. P'ship, 213 F.3d 175, 180 (4th Cir. 2000) (citing Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984)). A Rule 12(b)(6) motion to dismiss "should only be granted if, after accepting all well-pleaded allegations in the plaintiff's complaint as true, it appears certain that the plaintiff cannot prove any set of facts in support of his claim entitling him to relief." Migdal v. Rowe

Price-Fleming Int'l Inc., 248 F.3d 321, 325 (4th Cir. 2001). Furthermore, the "Federal Rules of Civil Procedure do not require a claimant to set out in detail the facts upon which he bases his claim." Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). Rather, Rule 8(a)(2) of the Federal Rules of Civil Procedure requires only a "short and plain statement of the claim showing that the pleader is entitled to relief." Migdal, 248 F.3d at 325-26; see also Swierkiewicz v. Sorema N.A., 534 U.S. 506,

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513, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002) (stating that a complaint need only satisfy the "simplified pleading standard" of Rule 8(a)). In reviewing the complaint, the court accepts all wellpleaded allegations of the complaint as true and construes the facts and reasonable inferences derived therefrom in the light most favorable to the plaintiff. Ibarra v. United States, 120

F.3d 472, 473 (4th Cir. 1997); Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993). However, in considering a motion to dismiss, the court "need not accept as true unwarranted inferences, unreasonable conclusions, or arguments" nor "the legal conclusions drawn from the facts." Eastern Shore Mkts., Inc., 213 F.3d at 180. Accord Sensormatic Sec. Corp. v.

Sensormatic Elecs. Corp., 329 F.Supp.2d 574, 578 (D. Md. 2004). In addition, courts need not accept conclusory factual allegations devoid of reference to any facts, United Black Firefighters v. Hirst, 604 F.2d 844, 847 (4th Cir. 1979). B. Interests Both parties agree that Natanzon does not have standing to address claims which belong solely to ERN. See National American Claim of Intentional Interference with Economic

Ins. Co. v. Ruppert Landscaping Co., Inc., 187 F.3d 439, 441 (4th Cir. 1999). (Paper No. 99 at 4).

Natanzon asserts that he has standing to bring a tortious

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interference claim on the following facts: Baron and Buchbinder allegedly damaged ERN's and Natanzon's economic relationships with independent sales organizations (ISOs) and merchants by making statements to ISOs about their lawsuits against ERN and Natanzon and about Natanzon personally. (Paper No. 99 at 8-10, 12, 16); Baron interfered with Natanzon's business interests by

"frustrating ERN's and Natanzon's ability to devote" their full time to the operation of their business, (Paper No. 18 at 12, 16); and Baron and Buchbinder allegedly filed lawsuits and otherwise interfered in Natanzon's attempt to rehabilitate ERN and meet his obligations under the MOU. (Paper No. 99 at 2). Each of Natanzon's claims will be addressed in turn. 1. Interference with the Natanzon's obligations under the MOU

First, Natanzon asserts that Baron and Buchbinder interfered in Natanzon's attempt to rehabilitate ERN and meet his obligations under the MOU. stand. The tort of wrongful interference with an existing contract will not lie where the defendant is a party to the economic relationship with which the defendant has allegedly interfered. Kaser v. Financial Protection Marketing, Inc., 376 Md. 621, 831 A.2d 49 (2003); Alexander v. Evander, 336 Md. 635, 640 n.8, 650 As a matter of law, this claim cannot

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A.2d 260, 265 (1994);2 Travelers Indem. Co. v. Merling, 326 Md. 329, 343, 605 A.2d 83, 89-90 (1992); K&K Management, Inc. v. Lee, 316 Md. 137, 156, 557 A.2d 965, 974 (1989); Wilmington Trust Co. v. Clark, 289 Md. 313, 329, 424 A.2d 744, 754 (1981). Judge

Quarles previously dismissed Baron and Buchbinder's complaint against Natanzon for tortious interference with the MOU, because Natanzon, Baron and Buchbinder are all parties to the MOU. (Paper No. 71). For the same reasons, as a matter of law, Natanzon

cannot recover for tortious interference with the MOU. 2. Interference with ERN's and Natanzon's economic relationship with independent sales organizations.

Natanzon also alleges that Baron and Buchbinder's wrongful conduct damaged ERN and Natanzon's relationship with the independent sales organizations (ISOs) and merchants. (Paper No. 99 at 8-10). "Tortious interference with business relationships arises only out of the relationship between three parties, the parties to a contract or other economic relationship... and the interferer." K&K Management, Inc. v. Lee, 316 Md. 137, 154, 557

Natanzon asks the Court to distinguish Alexander and Kaser on factual and procedural grounds. However, even if these cases are distinguishable, other Maryland cases are on-point. See Travelers Indem. Co. v. Merling, 326 Md. 329 (1992); K&K Management, Inc. v. Lee, 316 Md. 137, 557 A.2d 965 (1989); Wilmington Trust Co. v. Clark, 289 Md. 313, 329, 424 A.2d 744, 754 (1981). Moreover, the Court notes that Natanzon previously argued that the complaint against him for intentional interference with the MOU should be dismissed because both he and Baron were parties to the contract. (Paper No. 54-1)("Under Maryland law, a party to a contract cannot be held liable for tortious interference with the contract.")

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A.2d 965, 973 (1989).

A party may maintain an action "upon the

doctrine that a man who induces one of two parties to a contract to break it, intending thereby to injure the other or to obtain a benefit for himself, does the other an actionable wrong." Natural Design, Inc. v. Rouse Co., 302 Md. 47, 485 A.2d 663 (1984).3 Accord Restatement (Second) of Torts

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