IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

EUGENE DIVISION 

DEAN SCHMIDT, 

Plaintiff, 

v. 

SUMMIT FUNDING, INC., a California 

corporation; and DAVID KAMMERER, 

Defendants. 

MCSHANE, Judge: 

Case No. 6:15-cv-0640-TC 

ORDER 

Magistrate Judge Thomas M. Coffin filed a Findings and Recommendation, ECF No. 15, 

and the matter is now before this court. See 28 U.S.C. § 636(b)(1)(B), Fed. R. Civ. P. 72(b). 

Defendants filed a motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), ECF No.8; plaintiff 

responded, ECF No. 11. In his report, Judge Coffin recommended that defendants' mqtion be 

denied, and defendants filed objections, ECF No. 17. Plaintiffresponded to defendants' 

objections, ECF No. 18. I have reviewed the file of this case de novo. See 28 U.S.C. § 

636(b)(1)(C); McDonnell Douglas Corp. v. Commodore Bus. Mach., Inc., 656 F.2d 1309, 1313 

(9th Cir. 1981 ). I find no error and conclude the report is correct. 

Defendants present two objections to Judge Coffin's report. First, defendants contend that 

plaintiffs complaint should properly be construed as a torts claim, and that Judge Coffin 

erroneously "treat[ed] [plaintiffs claim] as though it were a garden-variety breach-of-contract 

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Case 6:15-cv-00640-TC Document 20 Filed 08/13/15 Page 1 of 3
claim." Defs.' Obj. 2, ECF No. 17. Second, defendants contend that plaintiffs breach-of-contract 

claim has been inadequately pleaded. !d. at 7. I am not persuaded by either objection. 

Defendants contend that plaintiffs breach-of-contract claim is actually an artfully 

pleaded torts claim. !d. at 2. I disagree. Defendants argue that plaintiff in his complaint failed to 

allege '"any specific contract [provision]"' that would have given rise to '"the fiduciary duties 

that were allegedly breached."' !d. at 5 (quoting Ass 'n of Unit Owners of Inn at Otter Crest v. 

Far West Fed. Bank, 120 Or. App. 125, 133 (1993)) (boldface and emphasis added by 

defendants). Such an omission, defendants argue, "confirm[s] that the claim in question is pled 

as a tort." Id. at 6. However, defendants misrepresent Association of Unit Owners. In their 

recitation of that precedent, defendants quote the case erroneously, substituting their word, 

"provision," in place of the court's words, "or other relationship." See Ass 'n of Unit Owners, 120 

Or. App at 133 ("The pleadings allege a 'joint venture' in the operation of the Inn, but they do 

not allege any specific contract or other relationship with defendants that gives rise to the 

fiduciary duties that were allegedly breached.") (emphasis added). Consequently, defendants 

present a fallacious standard-i.e., the identification of a specific contract provision-by which 

to assess whether plaintiffs complaintsounds in contract law or in torts. 

Here, plaintiffs complaint alleges the existence of a "relationship" between defendants 

and himself. In his complaint, plaintiff alleges that "[t]he parties agreed to certain divisions of 

partnership proceeds and began conducting business in or about 2009. Plaintiff invested time, 

intellectual property and certain assets, including office furniture and trade secrets, to the joint 

ventures." Compl. ~ 4, ECF No. 1-1. Plaintiff further alleges that "[p ]laintiff and [ d]efendants 

executed a 'Branch Manager Employment Agreement' in or about April, 2009, in which 

Defendant Summit describes various employment, partnership and franchise rights and 

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Case 6:15-cv-00640-TC Document 20 Filed 08/13/15 Page 2 of 3
obligations." Id. at~ 5. Thus, while plaintiff does not refer to a "specific contract provision" in 

his complaint, he does allege the existence of both a contract and a "relationship" that gave rise 

to the duties allegedly breached by defendants. Id. I therefore affirm Judge Cbffin's construction 

ofplaintiffs and defendants' relationship as a contractual arrangement that gave rise to certain 

obligations extending beyond the mere fiduciary obligations inherent to a partnership. 

Defendants further contend that plaintiffs breach-of-contract claim is inadequately 

pleaded. Defs.' Obj. 7, ECF No. 17. I disagree. Plaintiffhas adequately alleged: (1) the existence . -

of a contract; (2) the relevant terms of the contract; (3) plaintiffs full performance of the 

contract; and (4) resulting damages. See Fleming v. Kids & Kin Head Start, 71 Or. App. 718, 721 

(1985). Thus, I find that plaintiff has pleaded with sufficient factual specificity to survive a 

12(b)(6) motion to dismiss. See Bell At!. Corp. v. Twombly, 550 U.S. 544, 570 (2007). 

Magistrate Judge Coffin's Findings and Recommendation, ECF No. 15, is adopted in full. 

Defendants' motion to dismiss, ECF No.8, is DENIED. 

IT IS SO ORDERED. 

Dated this i J day of August, 2015. 

\ 

Michael J. McShane 

United States District Judge 

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