Hiller & Arban, LLC v. The Reserves Management, LLC ( 2016 )


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  • IN THE SUPERIOR COURT
    OF THE STATE OF DELAWARE
    HILLER & ARBAN, LLC,
    Plaintiff,
    C.A. No. N15C-02-161 WCC
    v §
    THE RESERVES MANAGEMENT,
    LLC and ABRAHAM KOROTKI,
    Defendants.
    \/\J\J\J§/\}\/\_/§/§/g/
    Submitted: February 23, 2016
    Decided: Ju1y 1, 2016
    Defendants’ Motion to Dismiss and for Other Relief
    GRANTED IN PART - DENIED IN PART
    MEMOILANDUM OPINION
    Adam Hiller, Esquire, Brian Arban, Esquire, Hiller & Arban, LLC, 1500 N. French
    Street, Z“d Floor, Wilmington, Delaware 19801. Attorneys for Plaintiff.
    Anthony M. Saccullo, Esquire, Thomas H. Kovach, Esquire, A.M. Saccullo Legal,
    LLC, 27 Crimson King Drive, Bear, Delaware 19701. Attorneys for Defendants.
    David L. Braverman, Esquire, Benj amin A. Garber, Esquire, Braverrnan Kaskey,
    P.C., One Liberty Place, 56“1 Floor, Philadelphia, PA 19103. Attorneys for
    Defendants.
    CARPENTER, J.
    The Court has before it a Motion to Dismiss and for Other Relief filed by
    Defendants, The Reserves Management, LLC ("Reserves Management") and
    Abraham Korotki ("Mr. Korotl2013 WL 2149993
    , at *12-13 (Del.
    Super. May 15, 2013) ("The only claims for relief unique to the fraud claims are for punitive
    damages. . ..The Court finds that Emmaus's breach of contract claims and fraud claims are based
    on the same operative facts. Additionally, Emmaus has not demonstrated a prima facie basis for
    damages for fraud or fraud in the inducement, separate and apart from any compensatory
    damages or declaratory relief to which Emmaus may be entitled for breach of contract or unjust
    enrichment
    ‘“ See 4C, Inc. v. Pouls, 
    2014 WL 1047032
    , at *7 (D. Del.`Mar. 5, 20l4) (citing AFH Hla'g.
    Advisory, LLC, 
    2013 WL 2l49993
    , at *13 and Greenstar, LLC v. Heller, 
    934 F. Supp. 2d 672
    ,
    697 (D. Del. 2013)).
    ll
    of future performance into fraud claim[s]" in cases where "particularized facts"
    were alleged to support an inference that the speaker had no intention of
    performing at the time the promise was made,"z the Second Amended Complaint
    fails to supply this factual basis. Although H&A claims Defendants promised to
    pay the firm and failed to uphold that promise, this alone, even if true, does not
    provide a basis to infer the promise was false when made.“ The well-pleaded facts
    in the Second Amended Complaint actually appear to belie that Defendants never
    intended to compensate H&A because it appears Defendants paid the f1rm, at least
    in part, as promised."" "[I]n the absence of additional circumstances, it will be
    found that a mere failure to perform is as consistent with an honest intent as with a
    dishonest one."‘“ As such, the fraud count is dismissed.
    “ See Grunstein, 
    2009 WL 4608541
    , at *l3 ("Unlike a traditional fraud claim that allows a
    plaintiff to plead intent generally, because the factual predicate of a promissory fraud claim is
    the speaker's state of mind at the time the statement is made, a general averment of a culpable
    state of mind is insufficient lnstead, the plaintiff "must plead specific facts that lead to a
    reasonable inference that the promissor had no intention of performing at the time the promise
    was made.").
    "’ See, e.g., Berdel, Inc. v. Berman Real Estate Mgmt., Inc., 
    1997 WL 793088
    , at *8 (Del. Ch.
    Dec. 15, l997) ("A party's failure to keep a promise does not prove that the promise was false
    when made.").
    "" Pl.’s Second Am. Compl. 11 9 (seeking amounts "totaling $103,367.71 after certain payments
    were received").
    "‘ Outa’oor Techs., Inc. v. Allfirst Fin., Inc., 
    2001 WL 54l472
    , at *4 (Del. Super. Apr. l2, 2001)
    (quoting Murphy v. T.B. O'Toole, Inc., 
    87 A.2d 637
    , 638 (Del. Super. 1952)).
    12
    3. Estoppel
    H&A also alternatively attempts to recover the unpaid fees and expenses
    from Reserves Management under the doctrine of promissory estoppel."é To
    establish a claim for promissory estoppel, a plaintiff must allege that:
    (i) a promise was made; (ii) it was the reasonable expectation of the
    promisor to induce action or forbearance on the part of the prornisee;
    (iii) the promisee reasonably relied on the promise and took action to
    his detriment; and (iv) such promise is binding because injustice can
    be avoided only by enforcement of the promise.‘"
    Like quantum meruit, estoppel is inapplicable where there is "an existing contract
    that governs the issue before the Court."‘"‘ Defendants thus repeat the argument that
    H&A’s contractual allegations prevent the finn from seeking recovery by estoppel.
    In response, H&A again maintains it is entitled to seek relief in the altemative
    under Delaware’s liberal standard of notice pleading."g While this may be true, "it
    should be noted that the doctrine of promissory estoppel is appropriately invoked
    where injustice can be avoided only by enforcement of the promz`se."$° Because
    H&A can proceed against Reserves Management under its claims for breach of
    1-= :1¢_1-
    l"‘ Pl.’s Second Am. Compl.1]1[ 41-5l.
    ‘" Alltrz`sta Plastics, LLC, 
    2013 WL 5210255
    , at *10.
    ‘“’ See id. at *9 ("[I]f there is an enforceable contract, promissory estoppel will apply only if the
    contract govems other aspects of the parties' relationship and not when the relied-upon promises
    were incorporated into the c0ntract.").
    "’ Pl. Obj. to Defs.’ Mot. to Dismiss and for Other Relief, M 3-4. H&A explains that it added the
    estoppel claim to the Second Amended Complaint specifically because of Defendants’ "coyness"
    with regard to their "inten[t] to dispute the existence of an agreement." Ia'.
    ‘° See Hursey Porter & Assocs. v. Bounds, 
    1994 WL 76267
    (), at *18 (Del. Super. Dec. 2, l994)
    (emphasis added).
    13
    contract and quantum meruz`t, "invocation of the doctrine of promissory estoppel is
    not necessary in order to avoid injustice in the instant case."“ Thus, H&A’s
    promissory estoppel claim will be disrnissed.
    A. MOTION FOR A MORE DEFINITE STATEMENT
    Defendants have also moved for a more definite staternent. Where a claim is
    "so vague or ambiguous" that the opposing party cannot reasonably respond, the
    Court may require a more definite statement pursuant to Rule l2(e).52 Defendants
    contend H&A has failed to provide sufficient notice regarding the basis of its
    claims. As a result, Defendants ask the Court to require H&A to attach a copy of
    the alleged agreement between the parties, identify and produce any invoices
    referenced in the Second Amended Complaint, identify payments it received, and
    state its fraud claim with particularity.” H&A responds that Defendants have cited
    no authority supporting that a party’s failure to attach an alleged contract warrants
    dismissal of an initial pleading.§" H&A also maintains that "to the extent
    Defendants want documents ‘produced,’ they have already received copies of
    51 See ia'. See also Avantix Labs., Inc. v. Pharmion, LLC, 
    2012 WL 2309981
    , at *ll (Del. Super.
    June 18, 2012) ("The Court already has determined that Avantix can proceed against Pharmion
    on the theory of quantum meruit Therefore, invocation of the promissory estoppel doctrine is not
    necessary to avoid injustice in the instant action. Avantix's promissory estoppel claim must be
    dismissed.").
    ” See Super. Ct. Civ. R. l2(e) (requiring such motions specify "defects" and/or "details
    desired").
    53 Defs.’ Mot. to Dismiss and for Other Relief, 11 8.
    5" Pl. Obj. to Defs.’ Mot. to Dismiss and for Other Relief, 11 2 n.l.
    14
    all. . .non-privileged documents. . .relating to any of the matters in which Korotki or
    his entities were involved, consisting of over 22,000 pages."”
    Defendants acknowledged at oral argument that H&A was not required, as
    a matter of pleading practice, to attach a copy of the alleged agreements.”
    However, they argue more specificity is justified in this case due to considerations
    relating to Mr. Korotki’s bankruptcy proceedings.” While the Court appreciates
    this complicating factor, in Delaware, a plaintiff is not required to attach all
    documents upon which its complaint is based.” The Second Amended Complaint
    pleads facts sufficient __to provide fair notice. More details regarding the allegations
    can be flushed out during disoovery.” As such, the request for a more definite
    statement is denied.
    B. MOTION TO STRIKE REQUEST FOR PUNITIVE DAMAGES &
    ATTORNEYS’ FEES
    Finally, Defendants ask the Court to strike Plaintiff’ s request for punitive
    damages and attomeys’ fees. Rule l2(f) permits the Court to strike "any
    insufficient defense" or "redundant, immaterial, impertinent or scandalous
    matter."6° Because motions to strike are disfavored in Delaware, they are "granted
    55 1_¢1., Ex. A, 11 35
    56 Hearing Tr. at 6.
    "" Ia'. at 7-8.
    53 See, e.g., VLIW Tech., LLCv. Hewlett-Packard C0., 840 A.Zd 606,6ll (Del. 2003).
    59 See id. (stating that defendants have "the burden to determine the details of the cause of action
    by way of discovery for the purpose of raising legal defenses").
    "’° See Super. Ct. Civ. R. l2(f).
    15
    sparingly" and only where "clearly warranted, with [any] doubt. . .resolved in favor
    of the pleadings."°l Since the Court has dismissed the fraud claim and the punitive
    damage request only related to that Count, it need only address Defendants’
    request as it pertains to the attorneys’ fees sought in connection with H&A breach
    of contract claim against Reserves Management.
    Delaware follows "the American Rule, under which each party must bear its
    own. . .attomeys' fees, absent certain exceptions" such as cases "where the parties
    agree by contract to shift the costs and expenses of litigation."§z The Second
    Amended Complaint alleges the agreement between H&A and Reserves
    Management provided that, in the event Reserves Management failed to pay
    invoiced amounts on time, the firm could recover costs of collection, including
    attorneys’ fees.“ Defendants ask the Court to strike the request for attomeys’ fees
    because H&A did not allege it issued any invoices nor did it attach invoices to the
    Second Amended Complaint.“ Considering this request in light of the pleadings,
    the Court cannot find that striking the demand for attomeys’ fees is "clearly
    warranted" given H&A’s allegation that the parties contracted to shift such costs
    :.;=~i=__¢1
    " See O'Neill v. AFS Hla'gs., LLC, 20l4"WL 626031, at *5 (Del. Super. Jan. l5, 2014). See also
    In re Estate of Cornelius, 
    2002 WL 1732374
     (Del. Ch. 2002) (stating movant must show "clearly
    and without doubt that the matter sought to be stricken has no bearing on the. . .litigation").
    " See Nichols v. Chrysler Grp. LLC, 
    2010 WL 5549048
    , at *3 (Del. Ch. Dec. 29, 2010).
    " Pl.’s Second Am. Compl., 11 19.
    " Defs.’ Mot. to Dismiss and for Other Relief , 11 7.
    16
    away from the firm in seeking to collect unpaid amounts.“ Thus, Defendants’
    motion to strike H&A’s request for attomeys’ fees is denied.
    CONCLUSION
    The Court will not repeat the admonitions that it made in the conclusion
    section of the related Opinion in Korotki v. Hiller & Arban, LLC, C.A. No.
    Nl5C-O7-l64 CCLD WCC (July l, 20l6) (Memorandum Opinion), but will
    simply say it is also applicable here. While the litigation between these parties is
    contentious, the Court expects counsel to avoid the tendency of taking on the
    personality of the clients, to litigate this matter professionally, and to perform their
    litigation responsibilities in a manner divorced from the parties’ hostile
    relationship.
    IT IS SO ORDERED.
    judge william c. carpenr@r,/ii'/.
    "" See O']Vez`ll, 
    2014 WL 626031
    , at *5 (acknowledging that motions to strike should be granted
    only when "clearly warranted," with all double resolved in favor of the pleadings).
    17
    this agreement was supplemented via email on June 25, 20 l 3 to provide for
    payment on a contingency fee basis with respect to the firrn’s work on the appeal
    of Reserve Management’s case against RT Properties, LLC ("Contingency Fee
    Supplement").5 Specifically, Defendants allegedly promised to pay H&A $45,000
    if the finn secured a favorable ruling from the Delaware Supreme Court.é
    H&A successfully prosecuted the RT Properties appeal, in addition to
    fumishing othd legal services and incurred expenses in connection therewith.7 To
    date, H&A maintains Defendants owe the finn $103,367.71 in unpaid fees and
    expenses.g As a result, H&A filed its Complaint on February l9, 2015, and
    subsequently amended its pleading on February 25, 20l5. Defendants moved to
    dismiss the First Amended Complaint and a hearing was held on August 14, 2015
    before Judge Scott,9 who reserved decision on the motion. Before a decision was
    rendered, however, Plaintiff was granted leave to amend its First Amended
    Complaint in accordance with Delaware Superior Court Civil Rule l5.
    H&A filed its Second Amended Complaint on September 22, 2015, which
    asserts claims for breach of contract and promissory estoppel against Reserves
    5 Id.
    5 Id. (noting that this agreement also provided Reserves Management would reimburse H&A for
    out-of-pocket expenses incurred in connection with the appeal).
    ’ Ia’. 1 9.
    “ Ia'. 111 9, l4. These fees and expenses "relate to a number of different matters, but for the most
    part related to [Reserves] Management’s litigation (including but not limited to two appeals)
    against American Acquisition Property I, LLC and R.T. Properties, LLC and its affiliates." Ia'. 11
    10.
    ’ Judge Scott, in the early stages of the litigation, discovered a conflict with the parties and the
    case was reassigned.
    Management, and quantum meruit and fraud against both Defendants. In addition
    to the $103,367.71 (plus costs and interest), H&A seeks attorneys’ fees in
    connection with the breach of contract and fraud counts, as well as punitive
    damages for fraud.l° Defendants responded on October 6, 2015 with the instant
    Motion and H&A filed an objection thereafter. The Court heard argument on the
    Motion on February 23, 2016, and its decision is as follows.
    DISCUSSION
    Defendants’ Motion asks the Court to: (l) dismiss H&A’s quantum meruit,
    fraud, and estoppel claims; and (2) strike H&A’s demands for punitive damages
    and attorneys’ fees ; or (3) in the alternative, order H&A to supply a more definite
    statement." The Court will address each form of relief sought by Defendants
    separately below.
    A. MOTION TO DISMISS
    Under Superior Court Civil Rule l2(b)(6), the Court may grant a motion to
    dismiss for failure to state a claim.‘z The standards applied by Delaware Courts in
    reviewing l2(b)(6) motions are well-established: (l) "all well-pleaded factual
    allegations are accepted as true;" (2) "even vague allegations are ‘well-pleaded’
    ‘° Pl. Second Am. Compl. 1[1] l5-5l.
    11 Defs.’ Mot. to Dismiss and for Other Relief , 111 l-2. Defendants do not, in the present Motion,
    seek dismissal of H&A’s breach of contract claim against Reserves Management, nor has the
    Court been provided copies of or evaluated the alleged Agreements. Defendants’ Motion to
    Dismiss the First Amended Complaint, did, however, request that the contract claim be
    dismissed.
    " See Super. Ct. Civ. R. l2(b)(6).
    if . . .the opposing party [has] notice of the claim;" (3) all reasonable inferences are
    drawn in the non-moving party’s favor; and (4) dismissal is appropriate only if
    recovery would be impossible under "any reasonably conceivable set of
    circumstances susceptible of proof."”
    1 . Quantum Meruit
    In Count ll of the Second Amended Complaint, H&A seeks recovery of
    unpaid fees and expenses from both Mr. Korotki and Reserves Management under
    the doctrine of quantum meruit. Quantum meruit is a quasi-contractual claim by
    which a plaintiff, "in the absence of an express agreement," may seek to "recover
    the reasonable value of . . .services it rendered to the defendant."l" To prevail under
    this theory, a plaintiff must show (l) its services were performed "with the
    expectation that the recipient would pay for them" and (2) "the recipient should
    have known. . .[plaintiff] expected to be paid."” Here, H&A alleges it represented
    Reserves Management at Mr. Korotki’s request with the expectation Reserves
    Management would compensate the firm for its services and reimburse certain
    see Beck v. brady-2004 wi 2154284, ar *1 (Del. supr. sept 20, 2004) (qu@ring Kofr@n v.
    Amoco Chems. Corp., 
    441 A.2d 226
    , 227 (Del. 1982)) (citing Precision Air v. Standard Chlorine
    ofDel., 
    654 A.2d 403
    , 406 (Del.l995) and Ramunno v. Cawley,'/'OS A.2d 1029, 1034
    (Del.l998)).
    14 See Abacus Sports [nsiallations, Ltd. v. Casale Const., LLC, 
    2012 WL 1415603
    , at *2 (Del.
    Super. Feb. 14, 20l2) (quoting Middle States Drywall, Inc. v. DMS Props.-First, Inc., 
    1996 WL 453418
    , at *10 (Del. Super. May 18, 1996)).
    15 See Petrosky v. Peterson, 
    859 A.2d 77
    , 79 (Del. 2004).
    expenses.“ According to H&A, Defendants accepted and benefitted from the
    firm’s representation, knowing it expected to be paid in return for its services."
    First, Defendants urge the Court to dismiss the quantum meruit claim as it
    pertains to Reserves Management because H&A also alleges that the parties’
    relationship is governed by an express agreement."‘ ln particular, Count l of the
    Second Amended Complaint asserts a claim for breach of contract against Reserves
    Management. Defendants are correct that quantum meruit is unavailable in cases
    where it is clear from the complaint that the parties’ relationship is controlled by
    contract.” Additionally, the Court agrees that the Second Amended Complaint
    appears to rely, primarily, on the existence of an express agreement between H&A
    and Reserves Management. The Court also recognizes, however, that it is
    permissible for a party to seek quasi-contractual relief in the alternative to its
    contract claims.z° Indeed, this practice is generally appropriate in cases where
    "there is doubt surrounding the enforceability or the existence of the contract."”
    "1‘ see P1. second An; Cor_npi."qtq 22, 25.
    17 See id. 1111 23-27.
    ” Defs.’ Mot. to Dismiss and for Other Relief , 11 l.
    " See Albert v. Alex. Br0wn Mgmt. Servs., Inc., 
    2005 WL 2130607
    , at *8 (Del. Ch. Aug. 26,
    2005) ("Courts generally dismiss claims for quantum meruit on the pleadings when it is clear
    from the face of the complaint that there exists an express contract that controls.").
    2° See Grunstein v. Silva, 2009 WL 469854l, at *9 (Del. Ch. Dec. 8, 2009) (addressing
    promissory estoppel claim and stating "by contending that the Plaintiffs' assertion of the
    existence of consideration by way of their breach of contract claim precludes their promissory
    estoppel claim, the Defendants, in effect, seek to deprive the Plaintiffs of the ability to plead in
    the alternative"). .
    “ See Albert, 
    2005 WL 2130607
    , at *8. See also Super. Ct. Civ. R. 8 (permitting parties to seek
    relief in the alternative or of different classif`ications).
    Here, H&A maintains it included both claims because it believes Defendants are
    reserving the right to challenge the existence of an enforceable agreement. H&A
    emphasizes that Defendants have not stipulated to the existence of a valid contract
    and the instant Motion to Dismiss does not directly respond to H&A’s breach of
    contract allegations. While the Court would anticipate that the parties’
    relationship, being that of lawyer-client, is governed by contract, there appears to
    be a question of whether the present dispute is in fact addressed by an enforceable
    agreement between the parties. As a result, the Court will allow H&A to plead
    quantum meruit in the altemative to its breach of contract claim against Reserves
    Managernent.zz
    Defendants also move to dismiss Count II with respect to Mr. Korotki on the
    basis that "he retained no individual benefit from the alleged services and [H&A]
    does not allege to have performed any legal services or incurred any expenses on
    behalf of l\/lr. Korotki."” Here, the Court agrees with Defendants. While the
    Second Amended Complaint alleges H&A "served as counsel to [Reserves]
    Management and. . .Korotki himself ’ and that "Korotki realized a benef`it" as a
    result, there is nothing more in this count that would reflect benefits beyond those
    received by Reserves Managernent.z" In fact, the Second Arnended Complaint
    __ __
    " Of course, if it is shown that the instant dispute was contemplated by the alleged agreement
    between the parties, H&A’s theory of recovery will be limited to its breach of contract claim.
    ” Defs.’ Mot. to Dismiss and for Other Relief, 11 l.
    “ See Pl.’s Second Am. Compl. 1[1[ 5, 27.
    asserts that, at all times, Mr. Korotki was "acting as president and controlling agent
    of [Reserves Management]" and is only alleged to have requested and accepted the
    relevant legal services on behalf of Reserves Management.” As plead, the Second
    Amended Complaint does not support a quantum meruit claim against Mr. Korotki
    individually, and this count will be dismissed as to him.
    2. Fraud
    To survive a motion to dismiss, a claim for fraud must allege:
    l) a false representation, usually one of fact, made by the defendant; 2) the
    defendant's knowledge or belief that the representation was false, or was
    made with reckless indifference to the truth; 3) an intent to induce the
    plaintiff to act or to refrain from acting; 4) the plaintiffs action or inaction
    taken in justifiable reliance upon the representation; and 5) damage to the
    plaintiff as a result of such reliance.%
    Superior Court Rule 9(b) additionally requires that "in all averments of fraud. . .the
    circumstances constituting fraud shall be stated with particularity."” As a result,
    "general allegations of fraud are insufficient" and a complaint must contain facts
    providing notice of the fraudulent acts charged.zg At the very least, a plaintiff must
    _--__e_ -_.__-=
    is S; i_d 1[?4, 7, 21-23. See generally Boulden v. Albiorix, Inc., 
    2013 WL 1455826
    , *2 (Del. Ch.
    Apr. lO, 2013) (rej ecting motion to amend to add claim for quantum meruit where the proposed
    complaint did not allege that the party against whom the claim was sought to be asserted "act[ed]
    in his personal capacity" or "would derive (or in fact, did obtain) a direct benefit" but rather
    "consistently referred to [him] . .. as working ‘on behalf of Janus’ or as a J anus representative").
    “’ Gajj‘z`n v. Telea'yne, Inc., 
    611 A.2d 467
    , 472 (Del.l992).
    " Del. Super. Ct. Civ. R. 9(b). Castetter v. Del. Dep 't of Labor, 
    2002 WL 8l9244
    , at *3 (Del.
    Super. Apr. 30, 2002) ("Because the claim of fraud, if established, may result in an award of
    punitive damages it is important that the defendants be provided with the specifics of the alleged
    conduct.").
    " See Castetter, 
    2002 WL 8l9244
    , at *3( noting also, however, that "[w]hile fraud must be
    alleged with particularity under Superior Court Civil Rule 9(b), it is only necessary to allege
    ultimate facts and not evidence").
    allege "(l) the time, place, and contents of the false representation; (2) the identity
    of the person rnaking the representation; and (3) what the person intended to gain
    by making the representations."z"°
    Here, H&A alleges Mr. Korotki requested and accepted the firm’s services
    on Reserves Management’s behalf throughout the course of H&A’s retention.”
    Mr. Korotki allegedly represented to H&A that Reserves Management intended to
    pay the firm for its services and out-of-pocket expenses for the purpose of
    "inducing H&A to continue providing services and incurring. . .expenses orr
    [Reserve Management’s] account."” According to H&A, Mr. Korotki’s
    representations were false and he knew they were false, i.e., Reserves Management
    did not intend to compensate H&A, at the time he made the representations.”
    H&A claims it fumished services and made advances on Reserves Management’s
    behalf in amounts "totaling $103,367.71" in reliance on Mr. Korotki’s
    representations, and that its reliance was justifiable "under the circumstances."”
    Because "the circumstances behind Korotki’s fraud. . .were egregious," H&A
    demands punitive damages and attomeys’ fees in addition to the unpaid fees and
    _1¢-
    ” See AbryP’rs V, L.P. v. F& WAcq. LLC, 891 A.Zd 1032, 1050 (Del. Ch. 2006).
    3° Pl.’s Second Am. Compl. 1[1[ 29-30, 33.
    311¢1.111[ 31-32.
    " Id. 111 36-37.
    ” Id. 1]1[ 38-39. H&A, in a footnote, clarifies that it does not seek to recover for its services
    and/or advances to the extent such amounts are subject to a discharge in bankruptcy. Id. 11 38
    expenses.“ In response, Defendants urge the Court to dismiss H&A’s fraud claim
    as an impermissible duplication of its breach of contract claim against Reserves
    Management and contend the Second Amended Complaint fails to plead the
    elements of fraud with particularity
    In Delaware, "where an action is based entirely on a breach of the terms of a
    contract between the parties, and not on a violation of an independent duty
    imposed by law, a plaintiff must sue in contract and not in tort."” Indeed, "[a]
    breach of contract claim cannot be turned into a fraud claim simply by alleging that
    the other party never intended to perform."” Ultimately, when, as here, a
    complaint alleges fraud contemporaneously with breach of contract, the fraud
    claim will survive only if premised "on conduct that is separate and distinct from
    the conduct constituting breach."” Courts generally focus on when the fraudulent
    conduct is alleged to have occurred.” A11egations related to the inducement to
    contract have been recognized as "separate and distinct" conduct, while those
    .3." Id. 11 ¢_10. H&A "_expressly limits its demand ...to amounts relating to services and expenses
    incurred. . .after December 10, 2012." Id.
    ”ITW Glob. Invs. Inc. v. Am. Ina'us. P'rs Capiz‘al Fund IV, L.P., 
    2015 WL 3970908
    , at *6 (Del.
    Super. June 24, 2015) (explaining that "a plaintiff cannot state a claim for fraud simply by
    adding the term ‘fraudulently induced’ to a complaint").
    " See Alltrista Plastz`cs, LLC v. Rockline Indus., Inc., 
    2013 WL 5210255
    , at *4 (Del. Super. Sept.
    4, 20l3) (emphasis added). See also Iotex Commc'ns, Inc. v. Defries, 
    1998 WL 9l4265
    , at *4
    (Del. Ch. Dec. 21, l998) ("[O]ne cannot ‘bootstrap’ a claim of breach of contract into a claim of
    fraud merely by alleging that a contracting party never intended to perform its obligations.").
    37 See ITW Glob. Invs. Inc., 
    2015 WL 3970908
    , at *6.
    ”See Cornell Glasgow, LLC v. La Grange Props., LLC, 
    2012 WL 2106945
    , at *8 (Del. Super.
    June 6, 2012).
    10