IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

WARREN CLAYBAR, et al., )

 )

Plaintiffs, )

)

v. ) CIVIL ACTION 14-0205-WS-C

 )

MICHAEL R. HUFFMAN, et al., )

 )

Defendants. )

ORDER

This matter comes before the Court on defendant Michael R. Huffman’s Motion to 

Dismiss (doc. 15). The Motion has been briefed and is now ripe for disposition.1

I. Relevant Background.

This action arises from an alleged oral profit-sharing agreement by certain contractors 

involved in the DEEPWATER HORIZON oil spill clean-up dating back to 2010. According to 

well-pleaded factual allegations of the Second Amended Complaint, which are accepted as true 

for purposes of this Order,2 plaintiff Rian Glasscock was offered a contract “to put together the 

 1 As originally formulated, Huffman’s Motion was styled as a “Motion to Dismiss 

or in the Alternative for a More Definite Statement.” In an Order (doc. 18) entered on August 1, 

2014, Judge DuBose summarily denied the request for more definite statement. As such, the 

only remaining portion of the Motion is that seeking dismissal of Counts IV and V pursuant to 

Rule 12(b)(6), Fed.R.Civ.P.

2 In their Response (doc. 29) to the Motion to Dismiss, plaintiffs have attached 

more than 150 pages of exhibits. These documents are apparently intended to corroborate and 

supplement plaintiffs’ account of the facts. The trouble is that this matter comes before the 

Court on Rule 12(b)(6) review. At that stage, litigants and courts are typically confined to the 

four corners of the pleadings. See, e.g., Keating v. City of Miami, 598 F.3d 753, 762 (11th Cir. 

2010) (in deciding Rule 12(b)(6) motion, courts “limit[] our review to the four corners of the 

complaint”); Wilchombe v. TeeVee Tunes, Inc., 555 F.3d 949, 959 (11th Cir. 2009) (“A court’s 

review on a motion to dismiss is limited to the four corners of the complaint.”) (citation and 

internal quotation marks omitted); Thaeter v. Palm Beach County Sheriff’s Office, 449 F.3d 

1342, 1352 (11th Cir. 2006) (“When considering a motion to dismiss, ... the court limits its 

consideration to the pleadings and exhibits attached thereto.”) (citation omitted). Accordingly, 

(Continued)

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required resources and management” for a direct contract with non-party National Response 

Corporation (“NRC”) to provide equipment and labor for the clean-up project. (Doc. 22, ¶¶ 16.) 

Glasscock contacted plaintiffs Warren Claybar and Halley Moor, as well as defendant Huffman 

Construction, Inc., “to partner in fulfilling the contract.” (Id., ¶ 17.)

For its part, Huffman Construction “did not have the local contacts necessary to fulfill the 

resource requirements of the contract with NRC.” (Id., ¶ 18.) To address that deficiency, 

Huffman Construction and Michael Huffman entered into an oral agreement with Glasscock, 

Claybar and Moor, whereby plaintiffs would furnish the necessary equipment and labor to fulfill 

the NRC contract, while defendants would provide insurance and administrative services. (Id., ¶ 

19.) Pursuant to this arrangement, the Second Amended Complaint alleges, the parties “agreed 

to share equally in the net profits of the Defendants[’] contract with NRC,” meaning that each of 

Glasscock, Claybar and Moor would receive 25% of those net proceeds, with Huffman 

Construction retaining the other 25%. (Id., ¶ 20.) The NRC contract yielded a bountiful harvest, 

as Huffman Construction allegedly received more than $4 million in net proceeds; however, 

Huffman Construction and Huffman never paid any of those profits over to Glasscock, Claybar 

and Moor. (Id., ¶¶ 21-22.)

Based on these factual allegations, plaintiffs bring state-law claims against both 

defendants on theories of breach of contract, unjust enrichment, conversion, and fraud / reckless 

or negligent misrepresentation, as well as a distinct claim for piercing the corporate veil. (See

doc. 22.)3 Two of these causes of action are germane to the pending Rule 12(b)(6) Motion. 

With regard to the fraud claim (Count IV), the Second Amended Complaint alleges that, 

although defendants agreed to share net profits from the NRC contract with plaintiffs, “[w]hen 

they entered into that agreement, Defendants had no intention of honoring their agreement to pay 

 

those exhibits cannot be considered at this time in shaping the facts before the Court. For the 

same reasons, Huffman’s recitation in his brief of numerous facts exogenous to the pleadings 

(see doc. 16, at 2-4) is improper in the context of a Rule 12(b)(6) motion; therefore, such extrapleading factual allegations are not examined herein.

3 Despite the state-law nature of these claims, federal subject matter jurisdiction 

over this matter appears proper. Plaintiffs have adequately pleaded diversity jurisdiction, 

inasmuch as all plaintiffs are alleged to be citizens of different states than all defendants, and the 

amount in controversy is pleaded to be well in excess of the $75,000 jurisdictional threshold.

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Plaintiffs their share of the profits.” (Doc. 22, ¶ 39.) Instead, the pleading asserts, defendants 

falsely conveyed their assent to the profit-sharing arrangement “in order to procure the ... 

necessary resources to carry out the NRC contract” and did so with full knowledge “that 

Plaintiffs would rely and act upon same.” (Id., ¶¶ 40-41.) In other words, the Second Amended 

Complaint pleads that the alleged oral contract was merely a ruse by Huffman Construction to 

mislead plaintiffs into providing assistance to perform the NRC contract, even though Huffman 

Construction from the outset never intended to make good on its promises.

To support the claim for piercing the corporate veil (Count V), the Second Amended 

Complaint alleges as follows: (i) Huffman and Huffman Construction “have combined and 

operated their affairs in such a way as to lose the protection of separate corporate and individual 

entities;” (ii) Huffman Construction “did not have bylaws at all material times;” (iii) Huffman 

Construction “has no resolutions authorizing corporate activity;” (iv) Huffman Construction and 

family members who were corporate officers would enter into loans without accompanying 

promissory notes setting forth repayment terms; and (v) officers utilized such loaned corporate 

funds to purchase recreational vehicles for personal use. (Doc. 22, ¶¶ 47-51.)

Defendant Huffman (but not defendant Huffman Construction) has now moved to 

dismiss Counts IV and V, on the theory that the operative pleading fails to plead fraud with 

particularity and lacks sufficient facts to justify piercing the corporate veil.

II. Analysis.

A. Legal Standard for Rule 12(b)(6) Motions.

To withstand Rule 12(b)(6) scrutiny and satisfy Rule 8(a), a plaintiff must plead “enough 

facts to state a claim to relief that is plausible on its face,” so as to “nudge[ ][its] claims across 

the line from conceivable to plausible.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 

S.Ct. 1955, 167 L.Ed.2d 929 (2007). “A claim has facial plausibility when the plaintiff pleads 

factual content that allows the court to draw the reasonable inference that the defendant is liable 

for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 

868 (2009) (citation omitted). “This necessarily requires that a plaintiff include factual 

allegations for each essential element of his or her claim.” GeorgiaCarry.Org, Inc. v. Georgia, 

687 F.3d 1244, 1254 (11th Cir. 2012). Thus, minimum pleading standards “require [ ] more than 

labels and conclusions, and a formulaic recitation of the elements of a cause of action will not 

do.” Twombly, 550 U.S. at 555. As the Eleventh Circuit has explained, Twombly / Iqbal

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principles require that a complaint’s allegations be “enough to raise a right to relief above the 

speculative level.” Speaker v. U.S. Dep’t of Health and Human Services Centers for Disease 

Control and Prevention, 623 F.3d 1371, 1380 (11th Cir. 2010) (citations omitted). “To survive a 

12(b)(6) motion to dismiss, the complaint does not need detailed factual allegations, ... but must 

give the defendant fair notice of what the plaintiff’s claim is and the grounds upon which it 

rests.” Randall v. Scott, 610 F.3d 701, 705 (11th Cir. 2010) (citations and internal quotation 

marks omitted).

B. Whether Plaintiffs Pleaded Fraud with Particularity.

As noted, Huffman’s Rule 12(b)(6) challenge to the Complaint is twofold. First, he

argues in cursory fashion that Count IV should be dismissed for failure to plead fraud with 

particularity. (See doc. 16, at 6.) The Federal Rules of Civil Procedure provide that “[i]n 

alleging fraud or mistake, a party must state with particularity the circumstances constituting 

fraud or mistake.” Rule 9(b), Fed.R.Civ.P. There is no “one size fits all” checklist for satisfying 

this requirement. See Tello v. Dean Witter Reynolds, Inc., 494 F.3d 956, 972-73 (11th Cir. 2007) 

(“While allegations of date, time or place satisfy the Rule 9(b) requirement that the 

circumstances of the alleged fraud must be pleaded with particularity, we have acknowledged 

that alternative means are also available to satisfy the rule in substantiating fraud allegations.”) 

(citation and internal marks omitted); Mechler v. John Hancock Life Ins. Co., 2008 WL 4493230, 

*3 (S.D. Ala. Sept. 30, 2008) (“Plaintiffs’ fraud/fraudulent suppression claim could be better 

pled; however, the complaint, taken as a whole, sufficiently alerts the defendant to the 

misconduct with which it is charged.”). And the Eleventh Circuit has emphasized that “[t]he 

application of Rule 9(b) ... must not abrogate the concept of notice pleading.” Ziemba v. 

Cascade Int’l, Inc., 256 F.3d 1194, 1202 (11th Cir. 2001) (citation and internal quotation marks 

omitted).

Examining the Second Amended Complaint in toto, the Court readily concludes that it

adequately pleads the circumstances constituting the alleged fraud for Rule 9(b) purposes. 

Indeed, the Second Amended Complaint alleges that defendants promised to pay Glasscock, 

Claybar and Moor each 25% of the net profits of the NRC contract, that they made this promise 

without ever intending to honor it, and that this promise tricked Glasscock, Claybar and Moor 

into furnishing resources to assist Huffman Construction in fulfilling the NRC contract. In light 

of those particularized factual allegations, no viable argument can be made that defendants have 

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not been alerted to the “precise misconduct with which they are charged,” Durham v. Business 

Management Associates, 847 F.2d 1505, 1511 (11th Cir. 1988), which is, after all, the purpose of 

the particularity rule. For that reason, defendant Huffman’s Motion to Dismiss is denied insofar 

as it seeks dismissal of Count IV for failure to plead fraud with particularity.4

C. Whether Plaintiffs’ Allegations of Piercing the Corporate Veil are Sufficient.

The second prong of Huffman’s Rule 12(b)(6) Motion relates to Count V, which alleges 

that Huffman Construction’s corporate veil should be pierced to impose individual liability on 

Huffman. It is well settled that “[t]he veil separating corporations and their shareholders may be 

pierced in some circumstances” to impose individual liability. Dole Food Co. v. Patrickson, 538 

U.S. 468, 476, 123 S.Ct. 1655, 155 L.Ed.2d 643 (2003).5 Alabama courts have cautioned that 

“[p]iercing the corporate veil to impose personal liability on a corporation’s shareholder is not a 

 4 At most, Huffman posits that Count IV flunks Rule 9(b) because it “fails to state 

when the misrepresentation was made, where it was made, what was said or any other fact 

attendant to the alleged misrepresentation.” (Doc. 16, at 6.) This contention is inaccurate. 

Taken in context, the Second Amended Complaint may be reasonably read as identifying a midJune 2010 timeframe for the alleged misrepresentations. Moreover, the pleading specifically 

alleges the nature of the misrepresentation (i.e., defendants’ promise to split profits with

plaintiffs when they had no intention of actually doing so), the manner in which such 

misrepresentation deceived plaintiffs (i.e., their reliance on it to furnish resources to Huffman 

Construction, anticipating a promised financial reward that defendants never planned to bestow), 

and what Huffman Construction obtained as a consequence of the fraud (i.e., response resources 

from plaintiffs to facilitate its performance of the NRC contract). That the pleading does not 

enumerate “where it was made” is not fatal to the sufficiency of Count IV. Again, the Rule 9(b) 

requirement that fraud be pleaded with particularity is not a rigid, inflexible checklist. Besides, 

Huffman has not articulated any manner in which the Second Amended Complaint’s failure to 

delineate the location where the alleged fraudulent statement was made results in inadequate 

notice to defendants about the circumstances of the alleged fraud, or in any way frustrates their 

ability to respond and defend against same. As such, defendant’s skeletal Rule 9(b) argument is 

unconvincing.

5 See also M & M Wholesale Florist, Inc. v. Emmons, 600 So.2d 998, 999 (Ala. 

1992) (“In order to recover against an individual for the debts of a corporation, the plaintiff must 

show (1) that the individual agreed to be liable for the debts; or (2) that the facts surrounding the 

transaction support a disregard for the corporate form.”); Cohen v. Williams, 318 So.2d 279, 281 

(Ala. 1975) (“In a proper case, when the corporate form is being used to evade personal 

responsibility this court has not been hesitant to disregard the corporate form and impose liability 

on the person controlling the corporation and subverting it to his personal use by the conduct of 

its business in a manner to make it merely his instrumentality.”).

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power that is exercised lightly.” Gilbert v. James Russell Motors, Inc., 812 So.2d 1269, 1273 

(Ala.Civ.App. 2001); see also First Health, Inc. v. Blanton, 585 So.2d 1331, 1334 (Ala. 1991) 

(“Piercing the corporate veil is not a power that is lightly exercised. ... The mere fact that an 

individual or another corporation owns all or a majority of the stock of a corporation does not, of 

itself, destroy the separate corporate entity.”). Notwithstanding this reluctance, Alabama courts 

have demonstrated willingness to pierce the corporate veil “where a corporation is set up as a 

subterfuge, where shareholders do not observe the corporate form, where the legal requirements 

of corporate law are not complied with, where the corporation maintains no corporate records, 

where the corporation maintains no corporate bank account, where the corporation has no 

employees, where corporate and personal funds are intermingled and corporate funds are used 

for personal purposes, or where an individual drains funds from the corporation.” Econ 

Marketing, Inc. v. Leisure American Resorts, Inc., 664 So.2d 869, 870 (Ala. 1994) (citations 

omitted).

The sum total of Huffman’s argument for dismissal of Count V is that “the facts alleged 

by Plaintiffs in their complaint don’t meet the stringent overall requirements of Alabama case 

law for ‘Piercing the Corporate Veil.’” (Doc. 16, at 8.) This barebones analysis is inadequate to 

entitle Huffman to relief. As a threshold matter, movant’s line of reasoning disregards the 

posture of this case at the pleadings stage, and fails to recognize or apply the relevant pleadings 

standard. A plaintiff need not definitively prove his claims in the complaint, much less recite 

each and every fact on which he intends to rely in support of those claims. See, e.g., Speaker, 

623 F.3d at 1386 (“Speaker need not prove his case on the pleadings – his Amended Complaint 

must merely provide enough factual material to raise a reasonable inference, and thus a plausible 

claim”); Simpson v. Sanderson Farms, Inc., 744 F.3d 702, 708 (11th Cir. 2014) (“[a] plaintiff 

need not plead detailed factual allegations” to survive a Rule 12(b)(6) motion) (citation and 

internal quotation marks omitted). Again, the Federal Rules of Civil Procedure establish a 

system of notice pleading. All that is needed is for plaintiffs’ Second Amended Complaint to 

“present sufficient factual matter, accepted as true, to raise a right to relief above the speculative 

level.” Simpson, 744 F.3d at 708 (citation and internal quotation marks omitted). By effectively 

insisting that plaintiffs prove their case at the pleadings stage, Huffman misstates applicable law 

and would subject Count V to more stringent review than that prescribed by Rules 8 and

12(b)(6).

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Pursuant to an Iqbal / Twombly analysis, the Court concludes that the Second Amended 

Complaint sets forth a plausible claim for piercing the corporate veil. In particular, plaintiffs’ 

pleading delineates specific facts supporting a reasonable inference that Huffman Construction 

neither observed the legal requirements of corporate law nor maintained corporate records, that 

corporate and personal funds were intermingled (with corporate funds being used for personal 

purposes), and that an individual (Huffman) has drained funds from the corporation. These are 

just the sort of facts that the Alabama Supreme Court recognized in Econ Marketing might 

justify the unusual step of piercing the corporate veil to impose pass-through individual liability. 

As such, the factual allegations of Count V suffice to support a plausible claim for piercing the 

corporate veil, and therefore withstand Iqbal / Twombly sufficiency review.6

III. Conclusion.

For all of the foregoing reasons, defendant Michael R. Huffman’s Motion to Dismiss 

(doc. 15) is denied in its entirety.

DONE and ORDERED this 19th day of September, 2014.

s/ WILLIAM H. STEELE 

CHIEF UNITED STATES DISTRICT JUDGE

 6 Of course, in so determining, the Court makes no findings and expresses no 

opinions as to the ultimate merit (or lack thereof) of plaintiffs’ claim to pierce the corporate veil 

of Huffman Construction and thereby hold Michael Huffman personally liable for alleged 

corporate misdeeds. That assessment is “a question of fact ... to be determined on a case by case 

basis,” Hill v. Fairfield Nursing and Rehabilitation Center, LLC, 134 So.3d 396, 411 (Ala. 2013) 

(citation omitted), at an appropriate time.

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