UNITED STATES BANKRUPTCY COURT 

SOUTHERN DISTRICT OF FLORIDA 

BROWARD DIVISION 

IN RE: 

SEVEN STARS ON THE HUDSON CASE NO: 19-17544-RBR 

CORPORATION, d/b/a ROCKIN’JUMP 

 Debtor, 

_______________________________________/ 

SEVEN STARS ON THE HUDSON ADVERSARY NO.: 19-01230-RBR 

CORPORATION, d/b/a ROCKIN’JUMP 

 Plaintiff, 

v. 

MDG POWERLINE HOLDINGS, LLC, 

and XBK MANAGEMENT LLC, d/b/a 

XTREME ACTION PARK, 

 Defendants. 

_______________________________________/ 

MDG POWERLINE HOLDINGS, LLC’S REPLY IN SUPPORT OF 

MOTION TO DISMISS COMPLAINT 

Defendant MDG POWERLINE HOLDINGS, LLC (“MDG Powerline”), by and through 

undersigned counsel, hereby files its Reply in Support of its Motion to Dismiss the Complaint of 

Debtor/Plaintiff Seven Stars on the Hudson Corporation (“Plaintiff”). 

Plaintiff’s Response confirms the fact that its claims are based entirely on the alleged 

conduct of MDG Powerline’s co-defendant, XBK Management LLC (“Xtreme”). Yet Plaintiff’s 

Complaint fails to allege the most basic elements of an agency relationship. Beyond that, 

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Plaintiff’s claims are expressly barred by the parties’ Lease Agreement, or otherwise fail on their 

face. Plaintiff’s Complaint should be dismissed in its entirety. 

A. Plaintiff Has Not Pleaded the Elements of an Agency Claim.

 In its Response, Plaintiff repeatedly conflates the standard for determining an agency 

relationship at summary judgment with the pleading standard for a claim based on an agency 

theory. Plaintiff’s Response simply confirms that it has failed to plead the necessary elements of 

an agency relationship between MDG Powerline and Xtreme in its Complaint. 

 As Plaintiff recognizes, to adequately allege an agency relationship it must allege (1) a 

representation by the principal; (2) reliance on that representation by a third person; and (3) a 

change of position by that third person in reliance upon such representation to his detriment. 

(D.E. 9 at 3.) Under Florida law, the representation by the principal must have “cause[d] the 

plaintiff reasonably to believe that the alleged agent is authorized to act for the principal’s 

benefit.” Franza v. Royal Caribbean Cruises, Ltd., 772 F.3d 1225, 1252 (11th Cir. 2014). 

 According to its Response, Plaintiff bases its agency claim upon a series of exchanges 

between itself and Xtreme, or complaints Plaintiff made to MDG Powerline. (D.E. 9 at 3-4.) 

However, Plaintiff has not alleged that MDG Powerline – the principal – made any statements or 

representations to Plaintiff that would cause it to reasonably believe that Xtreme was MDG 

Powerline’s agent. Allegations that the “Landlord communicated through Xtreme” (id. at 4) 

cannot, by themselves, support an agency claim, because a plaintiff must establish that the 

principal first made a representation causing it to reasonably believe that the agent was acting on 

the principal’s behalf. See Franza, 772 F.3d at 1252. Plaintiff’s assertion that MDG Powerline 

was “well aware” of Xtreme’s alleged conduct (D.E. 9 at 4-5) misses the point: Absent 

allegations that MDG Powerline made some affirmative representation to Plaintiff leading 

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Plaintiff to believe that Xtreme was acting as MDG Powerline’s agent, Plaintiff cannot assert a 

claim based on an agency theory. The Complaint contains no such allegations, as Plaintiff 

effectively concedes in its Response. Accordingly, all of Plaintiff’s claims against MDG 

Powerline based on an agency theory should be dismissed. 

B. Plaintiff’s Declaratory Judgment Claim Is Redundant

 Plaintiff’s declaratory judgment claim (Count II) is a carbon copy of its claims for breach 

of the covenant of quiet enjoyment and breach of the implied duty of good faith and fair dealing. 

(Compare D.E. 1 ¶ 67(a)-(h) with ¶¶ 30-59,68-71 & 78(a)-(m).) Because the issues raised in this 

claim are identical to those raised in Plaintiff’s contract-related claims, this declaratory judgment 

claim should be dismissed as duplicative. See Fernando Grinberg Tr. Success Int. Properties 

LLC v. Scottsdale Ins. Co., 2010 WL 2510662, at *1 (S.D. Fla. June 21, 2010); Ministerio 

Evangelistico Int'l v. United Specialty Ins. Co., 2017 WL 1363344, at *2 (S.D. Fla. Apr. 5, 

2017). 

 Relying on Kenneth F. Hackett & Assocs., Inc. v. GD Cap. Info. Tech. Solutions, Inc., 

744 F.Supp.2d 1305 (S.D. Fla. 2010), Plaintiff argues that its declaratory claim should survive 

because it is seeking “forward-looking relief,” But Plaintiff misapprehends Kenneth F. Hackett, 

which found that the declaratory claim was not duplicative of the breach of contract claims 

because the plaintiff could lose on its breach of contract claim and nevertheless be entitled to 

declaratory relief. Id. at 1311. That is not the case here: If MDG Powerline is not liable for 

Xtreme’s alleged mishandling of Plaintiff’s signage and front desk, then Plaintiff cannot be 

compelled to “restore” these items. And under no circumstances is Plaintiff entitled to a 

declaratory judgment against MDG Powerline for its own waiting line or display space for its 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 3 of 12
brochures, as these are not even contemplated in their Lease Agreement. This unnecessarily 

duplicative claim should be dismissed. 

C. Plaintiff’s Quiet Enjoyment Claim Is Expressly Barred by the Lease.

 In Count II of the Complaint, Plaintiff asserts a claim against MDG Powerline for breach 

of the covenant of quiet enjoyment based solely on the alleged conduct of the other tenant, 

Xtreme. (D.E. 1 ¶ 71 (“Landlord permitted Xtreme to act as its agent when dealing with the 

Debtor. Xtreme’s actions as described herein are therefore attributable to the Landlord”).) This 

claim is expressly disallowed by the covenant of quiet enjoyment contained in the Lease 

Agreement, which expressly states: “Landlord shall not be liable for any interference or 

disturbance by other tenants or third persons.” (D.E. 1-1 at 35, Sec. 20.21.) Contrary to the 

express terms of the Lease, Plaintiff improperly attempts to allege a breach of this covenant 

based solely on Xtreme’s alleged conduct. 

 Plaintiff cannot identify any cognizable legal basis to ignore this unambiguous contract 

term and attempt to attach liability for precisely the claims that the parties agreed to disclaim in 

the Lease Agreement. The only case cited in Plaintiff’s Response, Fredrick v. Squillante, 144 

So.2d 848 (Fla. 2d DCA 1962), is wholly distinguishable. Fredrick does not concern a 

contractual provision prohibiting liability for the conduct of a tenant or third party. Rather, 

Fredrick concerns a negligence claim against a real estate broker arising from statements made 

by the broker’s agent; the court held that the broker could not disclaim responsibility for an 

agent’s conduct after accepting the benefit of the agent’s actions by collecting a commission. Id.

at 849. This legal principle has nothing all to do with Plaintiff’s attempt to assert a breach of 

contract claim that is expressly disclaimed by the contract itself. And of course, there are no 

allegations that MDG Powerline received any benefit from Xtreme. 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 4 of 12
 “Under Florida law, when the terms of a contract are unambiguous, the Court is bound to 

give the language therein its plain and ordinary meaning.” Vernon v. Resolution Trust Corp., 

907 F.2d 1101, 1109 (11th Cir. 1990). By its plain terms, the Lease Agreement disallows any 

claim for breach of the covenant of quiet enjoyment based on the conduct of other tenants or 

third persons. Count II therefore fails on its face. 

D. Plaintiff’s Good Faith/Fair Dealing Claim Fails.

 In its Complaint, Plaintiff attempted to assert a claim for breach of the implied covenant 

of good faith and fair dealing against MDG Powerline based on the conduct of Xtreme or 

nonexistent contractual duties. (See, e.g., D.E. 1 ¶ 78(e)&(f).) In its Response, Plaintiff appears 

to retreat from these allegations in the Complaint, and it now bases its implied covenant claim 

exclusively on its allegations that it was not provided with outside signage or a “satellite front 

desk” at the facility. (Response at 9.) Nevertheless, this claim fails. 

 Once again, Plaintiff attempts to attribute Xtreme’s alleged conduct to MDG Powerline. 

The Complaint alleges that Xtreme, not MDG Powerline, “willfully refused” to provide 

advertising space on the marquee (D.E. 1 ¶ 45), and that Xtreme, not MDG Powerline, 

“dismantled and removed” Plaintiff’s front desk during renovations. (Id. at ¶ 33.) As discussed 

above, the Complaint fails to adequately allege an agency relationship between Xtreme and 

MDG Powerline, and therefore Plaintiff cannot allege that MDG Powerline breached any 

provisions of the Lease Agreement based on Xtreme’s conduct. And to the extent that Plaintiff 

attempts to base this claim on its claim for breach of the covenant of quiet enjoyment (D.E. 9 at 

9), this clearly fails, as any such claim is expressly barred under the terms of the Lease, as 

previously discussed. 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 5 of 12
E. Plaintiff’s Constructive Eviction Fails.

 As discussed in MDG Powerline’s Motion to Dismiss (D.E. 7 at 10-11), to sustain a 

claim for constructive eviction under Florida law, a tenant must have abandoned the premises as 

a result of the landlord’s actions allegedly giving rise to the claim. See, e.g., Richards v. Dodge, 

150 So.2d 477, 481 (Fla. 2d DCA 1963) (“abandonment of the premises within a reasonable time 

after the landlord’s wrongful act is a necessary element of constructive eviction”); Kaplan v. 

McCabe, 532 So.2d 1354, 1356 (Fla. 5th DCA 1988) (same); Bass v. Wollitz, 384 So.2d 704, 706 

(1st DCA 1980) (same). While Plaintiff baldly suggests that the law on constructive eviction has 

“evolved” (D.E. 9 at 9), it cites no authority overturning or contradicting the holdings of 

Richards, Kaplan, or Bass. In fact, the rule requiring abandonment of the premises to sustain a 

constructive eviction claim remains the controlling law in Florida today, as more recent cases 

confirm. See Wolfe v. Glasgow, 2009 WL 10670910, at *5 (M.D. Fla. Mar. 31, 2009). 

 Plaintiff cites a single case in its Response, Bermuda Ave. Shopping Ctr. Assocs., L.P. v. 

Rappaport, 565 So.2d 805 (Fla. 5th DCA 1990),1 which creates no conflict, as the plaintiff in 

that case seeking constructive eviction had closed its business as a result of the landlord’s 

conduct. Id. at 807. Indeed, the court in Bermuda Ave. cites Kaplan with approval. Id. at 806. 

 It remains the law in Florida that a tenant must have abandoned the premises in order to 

sustain a claim for constructive eviction under Florida law. Richards, 150 So.2d at 481; Kaplan, 

532 So.2d at 1356; Bass, 384 So.2d at 706; Wolfe, 2009 WL 10670910 at *5. Because Plaintiff 

has not alleged that it abandoned the premises, its constructive eviction claim fails. 

F. Plaintiff Cannot Recover for “Lost Business” Under FDUPTA.

                                                             1 In its Response, Plaintiff incorrectly identifies this case as Hudson Pest Control v. 

Westford Asset Mgmt. (D.E. 9 at 10.) 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 6 of 12
 As the Eleventh Circuit has repeatedly held, actual damages under FDUPTA “must be 

direct damages, not indirect and consequential damages.” Hetrick v. Ideal Image Dev. Corp., 

372 Fed. Appx. 985, 991 (11th Cir. 2010). See also HRCC, Ltd. v. Hard Rock Cafe Int'l (USA), 

Inc., 703 Fed. Appx. 814, 815 (11th Cir. 2017) (same). Thus, “FDUTPA damages are measured 

according to the difference in the market value of the product or service in the condition in which 

it was delivered and its market value in the condition in which it should have been delivered 

according to the contract of the parties.” Carriuolo v. Gen. Motors Co., 823 F.3d 977, 986 (11th 

Cir. 2016). 

In the Complaint, the only damages alleged in Plaintiff’s FDUPTA claim are “loss of 

business and damage to its competitive advantages it has earned in the marketplace.” (D.E. 1 at 

26.) Significantly, Plaintiff does not dispute that “lost business” and goodwill are consequential 

damages, not direct damages. See BPI Sports, LLC v. Labdoor, Inc., 2016 WL 739652, at *6 

(S.D. Fla. Feb. 25, 2016) (finding that “competitive harm, diverted or lost sales, and harm to the 

goodwill and reputation” were consequential damages and dismissing FDUPTA claim); 

Emondson v. 2001 Live, Inc., 2017 WL 10085029, at *2 (M.D. Fla. July 25, 2017) (“competitive 

harm, lost sales, harm to the goodwill and reputation” are consequential damages not recoverable 

under FDUPTA). 

Plaintiff instead attempts to evade the reach of this black-letter law with several strawman arguments. First, Plaintiff asserts that it is seeking to recover “damages it has already 

suffered.” (Response at 13.) This, again, misses the point: “Lost business” constitutes 

nonrecoverable consequential damages, whether it be past lost business or future lost business. 

Plaintiff then complains that it is not required to allege an “actual dollar amount” of damages. 

(Id.) MDG Powerline has not argued otherwise; rather, MDG Powerline argues that Plaintiff 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 7 of 12
may only recover direct damages under FDUPTA. Hetrick, 372 Fed. Appx. at 991; HRCC, Ltd., 

703 Fed. Appx. at 815. Finally, Plaintiff asserts that its FDUPTA claim should survive to 

preserve the “possibility” that it could demonstrate an “actual loss.” (Response at 13.) However, 

the Court cannot ignore what Plaintiff actually pleaded in its FDUPTA claim, which only claims 

as damages “the loss of business and damage to its competitive advantages it has earned in the 

marketplace.” (D.E. 1 at 26.) Simply put, Plaintiff has not even alleged that it suffered direct 

damages – a fatal defect in its FDUPTA claim. 

 Plaintiff’s FDUPTA claim also fails because it again is based on Xtreme’s conduct, not 

the conduct of MDG Powerline, and Plaintiff’s alleged injury did not arise from a consumer 

transaction. Leon v. Tapas & Tintos, Inc., 51 F.Supp.3d 1290, 1297 (S.D. Fla. 2014). For all of 

these reasons, Plaintiff’s FDUPTA claim should be dismissed. 

G. Plaintiff Cannot Salvage Its Conspiracy Claim

 As discussed in MDG Powerline’s Motion to Dismiss, Plaintiff’s civil conspiracy claim 

is defective for multiple reasons. (D.E. 7 at 15-17.) In its Response, Plaintiff asserts three 

separate arguments to salvage this claim – but all of them fail. 

 First, Plaintiff argues that its FDUPTA claim suffices as an underlying tort claim to 

support its conspiracy claim. (D.E. 9 at 14.) However, as discussed above, Plaintiff’s FDUPTA 

claim is fatally flawed and subject to dismissal. Accordingly, Plaintiff’s conspiracy claim must 

also be dismissed. See Rebman v. Follett Higher Educ. Grp., Inc., 575 F.Supp.2d 1272, 1280 

(M.D. Fla. 2008) (dismissing civil conspiracy claim when underlying FDUPTA claim fails). 

 Next, Plaintiff argues that it is actually asserting the independent tort of civil conspiracy, 

or “force of numbers” or “economic boycott” conspiracy. (D.E. 9 at 14-15.) This narrow 

doctrine is clearly inapplicable here. 

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 Under Florida law, the independent tort of conspiracy is actionable “where a plaintiff can 

show some peculiar power of coercion possessed by the conspirators by virtue of their 

combination, which power an individual could not possess.” Buckner v. Lower Fla. Keys Hosp. 

Dist., 403 So.2d 1025, 1029 (Fla. 3d DCA 1981) (citing Churruca v. Miami Jai-Alai, Inc., 353 

So.2d 547 (Fla. 1977)); see also Watershed Treatment Programs, Inc. v. United Healthcare Ins. 

Co., Inc., 2007 WL 1099124, at *5 (S.D. Fla. Apr. 10, 2007) (same). For this doctrine to apply, 

the alleged conspiracy must be among “separate economic groups or forces,” rather than members 

of the same company or entity, and those entities must be “identically situated to a plaintiff.” 

Watershed Treatment, 2007 WL 1099124 at *6; Buckner, 403 So.2d at 1029. Generally, such an 

“economic boycott” conspiracy must include more than two conspirators. O’Boyle v. Sweetapple, 

2015 WL 13574304, at *8 n.4 (S.D. Fla. June 4, 2015). 

 Here, the Complaint merely alleges that Xtreme and MDG Powerline engaged in a 

“conspiracy to deprive the Debtor of its rights under the Lease as well as interference with its 

business opportunities and customer base.” (D.E. 1 ¶ 100.) Because the Complaint alleges that 

Xtreme was acting as an agent of MDG Powerline, Plaintiff cannot now claim that they are acting 

as “separate economic forces,” as required to sustain the independent tort of conspiracy. Buckner, 

403 So.2d at 1029. Moreover, none of the alleged misconduct – taking down Plaintiff’s signs and 

inhibiting access to its business (D.E. 1 ¶ 99) – arose from some “peculiar power of coercion” 

resulting from the combined power of Xtreme and MDG Powerline. MDG Powerline would not 

need to rely on Xtreme to “deprive the Debtor of its rights under the Lease”; MDG Powerline 

surely possesses this power on its own. Nor are Xtreme and MDG Powerline “identically 

situated” with respect to Plaintiff: One is a co-tenant and alleged competitor, the other is a 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 9 of 12
landlord in privity. In such circumstances, a conspiracy claim cannot be sustained under the 

“force of numbers” exception. Watershed Treatment, 2007 WL 1099124 at *5-6. 

 Plaintiff reaches for the independent tort of conspiracy because it cannot bring a 

traditional conspiracy claim based on these alleged facts. “[A]n actionable conspiracy generally 

cannot exist between an entity and its officers, agents, or employees.” Five for Entm't S.A. v. 

Rodriguez, 2013 WL 4433420, at *13 n.10 (S.D. Fla. Aug. 15, 2013) (emphasis added); Zike, 

LLC v. Catalfumo, 2013 WL 12080225, at *8 (S.D. Fla. Feb. 22, 2013) (citing Hoon v. Pate 

Constr. Co., 607 So.2d 423, 430 (Fla. 4th DCA 1992)) (same). Plaintiff attempts to avoid the 

intra-corporate conspiracy doctrine by seeking refuge in the “personal stake” exception, under 

which an agent and a principal may be deemed separate co-conspirators where the agent is acting 

to advance its “personal interests, wholly and separately from the corporation.” Mancinelli v. 

Davis, 217 So.3d 1034, 1037 (Fla. 4th DCA 2017) (citing Microsoft Corp. v. Big Boy Distr. LLC, 

589 F.Supp.2d 1308, 1323 (S.D. Fla. 2008)). Moreover, for this exception to apply, the agent’s 

conduct must be motivated solely by its personal bias. HRCC, Ltd. v. Hard Rock Cafe Int'l (USA), 

Inc., 302 F.Supp.3d 1319, 1325 (M.D. Fla. 2016), aff'd, 703 Fed. Appx. 814 (11th Cir. 2017). 

The Complaint contains no allegations that Xtreme was acting solely to advance any personal 

stake it may have had. The personal stake exception is clearly inapplicable. 

CONCLUSION

For the reasons stated above and in its Motion to Dismiss (D.E. 7), MDG Powerline 

respectfully requests that the Court enter an Order dismissing Counts I, II, III, IV, V, VI and VIII 

 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 10 of 12
of the Complaint, and for such other relief as the Court deems just and proper. 

Respectfully submitted, 

 BILZIN SUMBERG BAENA 

 PRICE & AXELROD LLP 

 1450 Brickell Avenue, 23rd Floor 

 Miami, Florida 33131 

 (305) 374-7580 

 By: /s/ Jay M. Sakalo 

 Jay M. Sakalo 

 Fla. Bar No. 156310 

 and 

COFFEY BURLINGTON, P.L. 

2601 South Bayshore Drive, Penthouse One 

Miami, Florida 33133 

Tel: 305-858-2900 

Fax: 305-858-5261 

By: ___s/Susan E. Raffanello__________ 

Susan E. Raffanello, Florida Bar No. 676446 

sraffanello@coffeyburlington.com 

Scott A. Hiaasen, Florida Bar No.: 103318 

shiaasen@coffeyburlington.com 

lmaltz@coffeyburlington.com 

lperez@coffeyburlington.com 

service@coffeyburlington.com

Counsel for Defendant MDG Powerline 

Holdings, LLC 

Case 19-01230-SMG Doc 11 Filed 09/27/19 Page 11 of 12
CERTIFICATE OF SERVICE 

 I hereby certify that a true and correct copy of the foregoing was served by Notice of 

Electronic Filing generated by CM/ECF, on September 27, 2019, on all counsel or parties of 

record on the below/attached Service List. 

___s/Jay M Sakalo__________ 

 

Service List 

Kathleen A. Daly, Esq. 

Counsel for Debtor/Plaintiff 

Law Office of Kathleen A. Daly, P.A. 

515 North Flagler Drive 

Suite P300 

West Palm Beach, Florida 33401 

Tel: 561-293-8514 

kdaly@kadalylaw.com 

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