Court Opinion

ID: 9931009
Source: CourtListenerOpinion
Date Created: 2024-02-08 03:02:00.615625+00
Date Added: 2024-06-11T12:18:25.622134
License: Public Domain

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

ZEEL PATEL,                                )
                                           )
      Plaintiff,                           )
                                           )
             v.                            )     C.A. No. N23C-07-031 FWW
                                           )
THE JUICY CRAB MANAGEMENT,                 )
INC., and THE JUICY CRAB, INC.,            )
                                           )
      Defendants.                          )

                         Submitted: December 15, 2023
                           Decided: February 7, 2024

                      Upon Defendants’ Motion to Dismiss,
                    DENIED in part and GRANTED in part.

                   MEMORANDUM OPINION AND ORDER

Damien Nicholas Tancredi, Esquire, FLASTER GREENBERG P.C., 1007 Orange
Street, Suite 400, Wilmington, DE 19801, Attorney for Plaintiff Zeel Patel.

Patrick A. Costello, Esquire, DAILEY LLP, 1201 N. Orange Street, Suite 7300,
Wilmington, DE 19801, Attorney for Defendants The Juicy Crab Management,
Inc. and The Juicy Crab, Inc.

WHARTON, J.
                             I.    INTRODUCTION

      In late 2021 and early 2022, Defendants The Juicy Crab, Inc. (“TJC”) and its

subsidiary The Juicy Crab Management, Inc. (“Management”) (collectively “Juicy

Crab”) solicited Plaintiff Zeel Patel (“Patel”), who was then living and working in

Miami, Florida, to accept employment with them at their corporate headquarters in

Georgia. Accepting the job required Patel to move to Georgia. Patel and Juicy Crab

entered into an Employment Agreement and Patel moved to Georgia and began work

for Juicy Crab on February 7, 2022. Things did not go well from the start, and by

the end of March, Patel was no longer employed by Juicy Crab. He brought this

litigation, seeking damages for breach of contract under what he asserts is the

operative two-year employment term of the Employment Agreement, among other

causes of action. In its defense, Juicy Crab relies on a separate provision of the

contract which it claims made Patel an at-will employee subject to termination at

any time for any reason. Applying Georgia law, this Court determines that the

specific two-year employment provision controls the general at-will provision and

denies the motion to dismiss the breach of contract claim. Other claims are either

dismissed or not for the reasons set out below.

                II.    FACTS AND PROCEDURAL HISTORY

      Unless stated otherwise, the facts as recited here are taken from Patel’s

Complaint and are presumed to be true for purposes of the Motion to Dismiss. Patel

                                         2
is a New Jersey citizen residing in New Jersey.1 TJC is a Georgia corporation with

its principal place of business located in Norcross, Georgia.2 Management is a

Delaware corporation with its principal place of business also located in Norcross,

GA.3 Management is a subsidiary of TJC.4 TJC, together with related parents,

subsidiaries, and sister companies, operates a network of seafood restaurants,

primarily located in the Southeastern United States and Texas.5

      In October 2021, Patel was living and working full-time in Miami, Florida

when Juicy Crab solicited him to accept a full-time employment offer at its corporate

offices in Duluth, Georgia.6 Patel declined this offer but provided part-time remote

consulting services to Juicy Crab for the next few months.7 Juicy Crab solicited

Patel again for full-time employment, offering him the position of Senior Vice

President of Information Technology and Business Solutions on January 20, 2022.8

The position, in addition to its core duties relating to information and business

technology, included oversight and support of other divisions within Juicy Crab’s

1
  Compl. at ¶ 1, D.I. 1.
2
  Id. at ¶ 3.
3
  Id. at ¶ 2.
4
  Id. at ¶ 6.
5
  Id. at ¶ 4.
6
  Id. at ¶ 7.
7
  Id. at ¶ 8.
8
  Id. at ¶ 9.
                                         3
business that lacked experienced high-level management in human resources,

marketing, finance, and accounting.9

       Juicy Crab’s CEO Raymond Chen (“Chen”) and its Chief Operating Officer

Johnny Luo (“Luo”) repeatedly represented to Patel that Juicy Crab had an annual

gross revenue of $250 million dollars, forty restaurants, and a fifteen-percent net-

profit margin.10 Chen and Luo further represented that they had ample reserves to

expand their payroll to support Patel’s salary, as well as the salaries of multiple new

roles at Juicy Crab, including: a controller, a business analyst, a data analyst, a

human resources specialist, and franchise executives.11

       On the second solicitation of employment, Luo communicated another

employment offer by phone and followed up with a written employment offer.12 This

written employment offer did not contain a two-year agreement term or a 15%

employment bonus term, as previously discussed between Luo and Patel by phone.13

Patel then inquired Luo by phone to see if those terms were still part of Juicy Crab’s

employment offer.14 Luo answered in the affirmative, and on January 23, 2022 sent

a second written employment offer which included a two-year agreement term and

9
  Id. at ¶ 10.
10
   Id. at ¶ 19.
11
   Id. at ¶ 20.
12
   Id. at ¶ 14.
13
   Id. at ¶ 15.
14
   Id. at ¶ 16.
                                          4
a 15% employment bonus term.15 This time Patel accepted the second employment

offer and signed it on February 2, 2022 (“Employment Agreement”).16 Juicy Crab

signed on February 5, 2022.17

      In addition to the two-year agreement and 15% bonus terms, the Employment

Agreement also includes, among other provisions, an annual salary of $250,000, up

to $6,000 reimbursement of rent for an apartment or house of Patel’s choice and up

to $6,000 reimbursement for moving expenses with valid receipts submitted.18

      After signing the Employment Agreement, Patel resigned his previous full-

time position and signed a contract to buy a new house near Duluth, Georgia.19 He

put down a $6,000 deposit for the new house and scheduled closing for on or about

February 7, 2022.20 In the interim, Patel entered a month-to-month lease.21 He

moved to Georgia from Miami in early February 2022.22

      Patel arrived for work at Juicy Crab’s corporate offices in Duluth, Georgia on

February 7, 2022 and began working that day.23 His work included setting up several

15
   Id. at ¶¶ 16-17.
16
   Id. at ¶ 21; Defs.’ Mot. to Dismiss at Ex. A, 3, D.I. 11.
17
   Id.
18
   Id. at Ex. A, 1-2.
19
   Compl. at ¶ 22, D.I. 1.
20
   Id. at ¶ 23.
21
   Id.
22
   Id. at ¶ 22.
23
   Id. at ¶ 24.
                                           5
hiring interviews with qualified controllers.24 On Patel’s second day, Luo informed

Patel that Juicy Crab was going through corporate restructuring and “downsizing”

but that Patel’s job was secure.25 On February 10, 2022, Chen reiterated that Juicy

Crab was undergoing corporate restructuring and that Patel’s job was secure.26 On

February 11, 2022, Luo told Patel that Patel should cancel the contract for his new

house and that Juicy Crab would reimburse him for his losses in terminating the

purchase contract.27 Patel cancelled the purchase contract for the new house and

continued working pursuant to the Employment Agreement.28

       As part of Patel’s work, he began the process of recruiting personnel and

connecting with key vendors of Juicy Crab.29 He sought clarification from Juicy

Crab’s management as to how he should proceed on these tasks.30 However, as of

February 12, 2023, all Juicy Crab employees ceased to communicate with him

directly.31 Patel now only received communication from outside firms and agents

purporting to speak for Juicy Crab.32 Patel was simply instructed to continue his

24
   Id.
25
   Id. at ¶ 25.
26
   Id. at ¶ 26.
27
   Id. at ¶ 27.
28
   Id. at ¶¶ 29-30.
29
   Id. at ¶ 31.
30
   Id.
31
   Id. at ¶ 32.
32
   Id.
                                        6
work.33 On March 16, 2022, while accessing information from an outside provider

about his employment health benefits, Patel was informed by the provider that his

benefits would be canceled at the end of the month.34 It was only then, that Patel

discovered he had been terminated from Juicy Crab.35 No person from Juicy Crab

has communicated with Patel since.36

      On July 6, 2023, Patel filed this Complaint against Juicy Crab.37          The

Complaint alleges five counts: Count I - Breach of Contract, Count II - Breach of

Implied Covenant of Good Faith and Fair Dealing, Count III - Fraud in the

Inducement, Count IV - Negligent Misrepresentation, and Count V - Promissory

Estoppel.38 On September 15, 2023, Juicy Crab filed this Motion to Dismiss.39 On

October 6, 2023, Patel filed his Opposition Brief to Defendants’ Motion to Dismiss.40

Juicy Crab then supplemented their motion with a compendium of cases on

December 15, 2023.41

                     III.   THE PARTIES’ CONTENTIONS

33
   Id. at ¶ 34.
34
   Id. at ¶ 36.
35
   Id. at ¶ 38.
36
   Id.
37
   Id. at 19.
38
   Id. at 9-10, 12, 15, 17.
39
   Defs.’ Mot. to Dismiss at 22, D.I. 11.
40
   Pl.’s Opp. To Defs.’ Mot. to Dismiss at 17, D.I. 14.
41
   Defs.’ Compendium of Cases, D.I. 15.
                                          7
      Juicy Crab moves to dismiss pursuant to Del. Super. Ct. Civ. R. 12(b)(6) for

failure to state a claim upon which relief can be granted.42 Juicy Crab first contends

that this Court may consider the terms of the Employment Agreement, which was

not attached to the Complaint, because it is integral to the Complaint.43 Juicy Crab

then argues that Count I - Breach of Contract fails because the Employment

Agreement contains an At-Will Employment clause, allowing Juicy Crab to

terminate Patel at any time.44 Juicy Crab argues Count II - Breach of Implied

Covenant of Good Faith and Fair Dealing fails because the At-Will Employment

clause gave Juicy Crab the express right to terminate Patel at any time.45 Juicy Crab

argues that Count III - Fraud in the Inducement fails because: (1) Patel does not

plead fraud with the particularity required by Del. Super. Ct. Civ. R. 9(b) because he

has not pled the time and place of the allegations; and (2) the Employment

Agreement’s merger clause bars Patel’s fraud allegation because the alleged

promises or representations upon which Patel relies were outside of the Employment

Agreement.46 Lastly, Juicy Crab argues the Count IV - Negligent Misrepresentation

fails because: (1) Georgia’s “economic loss rule” bars this tort-based claim; (2) Patel

42
   Defs.’ Mot. to Dismiss at 1, D.I. 11. Juicy Crab does not move to dismiss Count
V - Promissory Estoppel.
43
   Id. at 12.
44
   Id. at 13-14.
45
   Id. at 16.
46
   Id. at 16-19.
                                          8
does not identify an independent legal duty that Juicy Crab violated; and (3) Patel

does not “state how actual economic loss proximately resulted from the alleged

misrepresentations or how Patel reasonably relied on [Juicy Crab’s] allegedly

negligent misrepresentations in light of the At-Will Employment clause.”47

      In the Complaint, Patel states that the application of Georgia law is

appropriate.48 In his Opposition to Defendants’ Motion to Dismiss, Patel argues that

the Employment Agreement is not “at-will” because it has a definite two-year

agreement term.49 Patel argues that Juicy Crab’s argument to dismiss Count II -

Breach of Implied Good Faith and Fair Dealing necessarily fails because the

Employment Agreement was not “at-will.”50 Patel contends that he pled fraud with

the requisite particularity in his Count III - Fraud in the Inducement claim “by

identifying [Juicy Crab’s] fraudulent statements, how they were false, who made

them and why, to whom, where, and during which specific timeline.”51 Further, Patel

argues that the merger clause does not bar this claim because “the merger clause does

not disclaim representations of fact, only ‘promises or commitments.’”52

Additionally, Patel contends that even if the merger clause did preclude reliance on

47
   Id. at 20-21.
48
   Compl. ¶ 45, D.I. 1.
49
   Pl.’s Opp. To Defs.’ Mot. to Dismiss at 6, D.I. 14.
50
   Id. at 12.
51
   Id. at 13.
52
   Id. at 15.
                                          9
Juicy Crab’s misrepresentations of fact, he could still assert Fraud in the Inducement

in the alternative to his Breach of Contract claim.53 Patel argues that Count IV -

Negligent Misrepresentation was valid because Juicy Crab “violated an independent

duty of care outside the parties’ contractual obligation, i.e., the duty of care against

making false or misleading statements to induce reliance by the other party to a

transaction.”54     Further, Patel contends he may also plead Negligent

Misrepresentation in the alternative to his Breach of Contract claim.55

                  IV.   STANDARD AND SCOPE OF REVIEW

       Under Superior Court Civil Rule 12(b)(6), dismissal is warranted only if it

appears with reasonable certainty that the nonmoving party would not be entitled to

recover under any reasonably conceivable set of circumstances.56 In ruling on a

12(b)(6) motion, the Court draws all reasonable factual inferences in the light most

favorable to the opposing party,57 and assumes that all well-pleaded facts in a

complaint are true.58 The Court's review is limited to the well-pled allegations in the

53
   Id.
54
   Id. at 16.
55
   Id.
56
   Greenfield for Ford v. Budget of Delaware, Inc., 2017 WL 729769, at *2 (Del.
Super. Ct. Feb. 22, 2017).
57
   Id.
58
   Brevet Capital Special Opportunities Fund, LP v. Fourth Third, LLC, 2011 WL
3452821, at *6 (Del. Super. Ct. Aug. 5, 2011).
                                          10
complaint.59 However, the Court may consider documents outside of the pleadings

when they are integral to a plaintiff's claim and incorporated in the complaint.60

Allegations are well-pleaded if they place the defendant on notice of the claim.61

Allegations of fraud shall be stated with particularity.62

                                V.     DISCUSSION

A.    The Court Applies Georgia Substantive Law

      As to what state’s law should apply, the Complaint contends that the

application of Georgia law is appropriate because: (1) the Employment Agreement

emanated from Juicy Crab’s corporate headquarters in Georgia; (2) the Employment

Agreement contemplated that Patel would be employed in Georgia, thereby making

Georgia the place of performance of the contract; (3) the harm to Patel caused from

the breach occurred originally in Georgia; and (4) Juicy Crab’s’ operations are

headquartered in Georgia.63 Juicy Crab does not contend otherwise except to point

out that even if Georgia law applies to substantive issues, Delaware law applies to

procedure.64   In the absence of a forum selection clause, the Court finds the

59
   Doe v. Cahill, 884 A.2d 451, 458 (Del. 2005).
60
   Allen v. Encore Energy Partners, L.P., 72 A.3d 93, 96 n.2 (Del.2013).
61
   Precision Air, Inc. v. Standard Chlorine of Del., Inc., 654 A.2d 403, 406 (Del.
1995).
62
   Del. Super. Ct. Civ. R. 9(b).
63
   Compl. ¶ 45, D.I. 1.
64
   Defs.’ Mot. to Dismiss at 11 n.5, D.I. 11.
                                          11
application of Georgia law to be appropriate for substantive issues, and the

application of Delaware law to be appropriate for procedure.

B.    The Employment Agreement Was Incorporated in the Complaint and Is
      Integral to It

      Juicy Crab presented the Employment Agreement to this Court as an exhibit

in the Motion to Dismiss. 65 Patel’s claims are either based on, or directly related to

the Employment Agreement.66        While Patel did not include the Employment

Agreement in the Complaint, he did incorporate it by reference throughout the

Complaint.67 Juicy Crab asserts that despite the Employment Agreement not being

attached to the Complaint, the Court may consider the Employment Agreement

because it is integral to the Complaint.68       The Court finds the Employment

Agreement was incorporated in the Complaint and that it was integral to Patel’s

claims.69 Therefore, the Court considers the Employment Agreement in deciding

this motion.

C.    Count I - Breach of Contract

      The Court turns to Juicy Crab’s argument to dismiss Count I - Breach of

Contract. The Employment Agreement states: “The term of this agreement will be

65
   See id. at Ex. A.
66
   See Compl. at ¶¶ 9-10, 12, 15, 17, D.I. 1.
67
   Id. passim.
68
   Defs.’ Mot. to Dismiss at 12, D.I. 11.
69
   Allen, 72 A.3d at 96 n.2.
                                          12
2-years, with successful completion of the responsibilities outlined below.”70 It also

states: “At-Will Employment:71 Your employment with The Juicy Crab Inc. will be

on an at-will basis sans terms and conditions outline [sic] in this agreement. This

means that either you or the company can terminate the relationship at any time, with

or without cause or advance notice.”72

      Juicy Crab’s argument to dismiss Count I - Breach of Contract is based on its

view that the At-Will Employment clause controls the Employment Agreement.73

Juicy Crab points out that “nowhere does the contract state or indicate that the first

70
  Defs.’ Mot. to Dismiss at Ex. A, 1, D.I. 11. Additional Employment Agreement
language related to the two-year term includes:

      (All moving expenses and temporary housing assistant amount paid
      must be returned back to company if you decided to terminate your
      employment prior to the 2-year commitment.)
                                       …
      Bonus/Commissions: You will be eligible for bonus of 15% of your
      annual salary based on individual performance and company
      profitability.

      Year 1: Bonus will be paid if Responsibilities are met. Additionally,
      details of the bonus structure will be reviewed and agreed upon for Year
      2.

      Year 2: Bonus will be contingent on agreed upon metrics and goals
      determined in the previous year. If no guideline is established, Year 1
      policy will continue.

Id. at Ex. A, 2 (Bold omitted).
71
   Items in bold appear in that manner as headings in the Employment Agreement.
72
   Defs.’ Mot. to Dismiss at Ex. A, 2, D.I. 11.
73
   Defs.’ Mot. to Dismiss at 8-9, D.I. 11.
                                         13
two years of the contract are not also governed by the At-Will Employment clause[,]”

and “the agreement does not state that the first two years of employment are

guaranteed employment and that the At-Will Employment clause only applies after

those first two years expire.”74

      Georgia caselaw provides clarity when an employment contract contains

conflicting “specific” and “general” durational employment contract terms. In Avion

Systems Inc. v. Thompson,75 the Georgia Court of Appeals reviewed a summary

judgment appeal based on an employment contract which stated: the employee was

joining the employer as a “full time employee at will[,]” and “[t]he [e]mployee, upon

his/her consent, agrees to provide on-site consulting services … for a minimum of

(12) months.”76 The employee signed the employment contract, and within 12-

months notified the employer by email that she was terminating her employment.77

The employer brought suit thereafter, alleging that the employee breached the

covenant to provide services for 12-months.78

      The employee in Avion Systems Inc. argued that her agreement to provide

services for 12 months was invalid and that this term conflicted with the general

74
   Id. at 13-14.
75
   293 Ga.App. 60 (2008).
76
   Id. at 61.
77
   Id.
78
   Id.
                                         14
provision for employment “at-will” in the introductory paragraph.79 The employer

argued that the agreement to provide services for a minimum of 12 months was

enforceable.80 The Georgia Court of Appeals agreed with the employer, writing:

      The construction of a contract is a question of law for the courts, as is
      the existence or nonexistence of an ambiguity in a contract. Where the
      terms of a contract are clear and unambiguous, the court looks only to
      the contract to find the parties' intent. If the contract is ambiguous in
      some respect, the court must apply the rules of contract construction to
      resolve the ambiguity.

      We hold that the contract provided that although the employment was
      generally at-will, it was subject to [the employee’s] agreement to refrain
      from terminating her employment for 12 months. To the extent there
      was any conflict in terms as to whether [the employee] could terminate
      her employment at-will or was limited to a fixed term of at least one
      year, we resolve this issue by principles of contract construction.
      Pursuant to OCGA § 13–2–2(4), we favor a construction that upholds
      the contract “in whole and in every part.” Furthermore, when a
      provision specifically addresses the issue in question, it prevails over
      any conflicting general language. Where, as here, the parties have
      explicitly set forth restrictions on the time and manner in which an
      employee may terminate employment, these specific terms must prevail
      over any conflicting general language of employment at-will.81

      Given this precedent, the Court finds that the Employment Agreement

contains an ambiguity between the two-year agreement term and the At-Will

Employment clause.82 The Employment Agreement’s two-year agreement

79
    Id.
80
    Id.
81
    Id. at 62-63 (internal citations and quotations omitted).
82
   Id. at 63 (citing Cassville–White Assoc. v. Bartow Assoc., 150 Ga.App. 561,
564(3)(a) (1979)).
                                         15
term prevails over the general At-Will Employment clause because the two-

year agreement term is specific and the At-Will Employment clause is

general.83 Pursuant to Georgia contract law, this construction effectuates the

clear intent of the parties and upholds the contract “in whole and in every

part[.]”84 The two-year agreement term controls the Employment Agreement

over the At-Will Employment clause for two years from the time the

Employment Agreement went into effect. As a result, the Employment

Agreement was not “at-will” at the time of Patel’s termination. Therefore, it

does not appear with reasonable certainty that Patel would be unable to

recover under any reasonably conceivable set of circumstances on Count I -

Breach of Contract.85 Juicy Crab’s motion as to Count I-Breach of Contract

is DENIED.

D.    Count II - Breach of Implied Covenant of Good Faith and Fair Dealing

      Juicy Crab also moves to dismiss Count II - Breach of the Implied Covenant

of Good Faith and Fair Dealing. As Patel correctly argues, Juicy Crab’s argument

necessarily fails because it rests on the incorrect assumption that the Employment

Agreement’s At-Will Employment clause controlled at the time of Patel’s

termination from Juicy Crab. But, the specific two-year employment provision

83
   Id.
84
   Id. (quoting OCGA § 13-2-2(4)).
85
   Greenfield for Ford, 2017 WL 729769, at *2.
                                        16
controlled at the time of Patel’s termination.86 Therefore, it does not appear with

reasonable certainty that Patel would be unable to recover under any reasonably

conceivable set of circumstances on Count II - Breach of the Implied Covenant of

Good Faith and Fair Dealing.87 Juicy Crab’s motion as to Count II - Breach of the

Implied Covenant of Good Faith and Fair Dealing is DENIED.

E.    Count III - Fraud in the Inducement

      1.     Patel Pled Fraud with Sufficient Particularity

      Juicy Crab argues that Patel did not plead fraud with sufficient particularity as

required by Del. Super. Ct. Civ. R. 9(b).88 Specifically, Juicy Crab argues that the

Complaint fails to identify the time and place for many of the alleged

misrepresentations that allegedly induced him into entering into the Employment

Agreement.89 “Under the particularity requirement, a plaintiff must plead the time,

place, and contents of the false representations, as well as the identity of the person

making the representation.”90 The Complaint meets that requirement.91 Patel

correctly points out:

      [T]he Complaint alleges with particularity that [Juicy Crab] materially
      inflated their financial condition, prospects for growth, and capacity to

86
   See 12-16, supra.
87
   Greenfield for Ford, 2017 WL 729769, at *2.
88
   Defs.’ Mot. to Dismiss at 16, D.I. 11.
89
   Id. at 19.
90
   KnighTek, LLC v. Jive Commc'ns, Inc., 225 A.3d 343, 351 (Del. 2020)
(quotations omitted).
91
   See Compl. ¶¶ 7-13, 19- 21, 43, 63, 67-68, D.I. 1.
                                          17
      provide the position and compensation they promised [Patel]. [Juicy
      Crab], however, ignore[s] [Patel’s] allegations of the location and time
      of the actionable statements. As the Complaint states, [Chen and Luo]
      communicated the misrepresentations from Duluth, Georgia, to [Patel]
      in Miami, Florida. The Complaint also delineates the timespan of the
      misrepresentations: between [Patel’s] rejection of [Juicy Crab’s] first
      employment offer of October 2021 and his acceptance of the final
      Employment Offer on February 2, 2022.92

      2.     The Employment Agreement’s Merger Clause Bars Count III -
             Fraud in the Inducement

      Juicy Crab also argues that Patel cannot reasonably rely on any alleged

representations outside of the Employment Agreement as a basis for fraudulent

inducement.93    Georgia caselaw provides that by affirming a contract with a

merger clause, a plaintiff effectively disclaims all alleged oral misrepresentations,

and, as a result, the plaintiff has no remaining evidence on which to support a fraud

claim.94 In Ekeledo v. Amporful, the Supreme Court of Georgia wrote:

      In general, a party alleging fraudulent inducement to enter a contract
      has two options: (1) affirm the contract and sue for damages from the
      fraud or breach; or (2) promptly rescind the contract and sue in tort for
      fraud. … Furthermore, where the allegedly defrauded party affirms a
      contract which contains a merger or disclaimer provision and retains
      the benefits, he is estopped from asserting that he relied upon the other
      party's misrepresentation and his action for fraud must fail. In essence,
      a merger clause operates as a disclaimer of all representations not made
      on the face of the contract.95

92
   Pl.’s Opp. To Defs.’ Mot. to Dismiss at 13 (internal citations omitted), D.I. 14.
93
   Defs.’ Mot. to Dismiss at 19, D.I. 11.
94
   See Ekeledo v. Amporful, 281 Ga. 817, 819 (2007).
95
   Id. (internal citations and quotations omitted).
                                          18
      Notably, the Employment Agreement includes the following merger

clause: “This offer letter comprises the complete terms of the offer regarding

your potential employment. Any oral promises or commitments of any kind

made during the interview process or by anyone else at the Company are not

valid unless contained in this offer letter.”96

      Here, Patel pleads Count III - Fraud in the Inducement based on

misrepresentations made by Chen and Luo.97 By affirming the Employment

Agreement and its merger clause, Patel effectively disclaimed all of these

misrepresentations, and, as a result he has no remaining evidence on which to

support his claim of fraud in the inducement.98 Further, Patel provides no

authority for his contention that “the merger clause does not disclaim

representations of fact, only ‘promises or commitments.’”99 Nor does he

clearly distinguish between alleged “representations of facts” and alleged

“promises or commitments.”

96
    Defs.’ Mot. to Dismiss at Ex. A, 3, D.I. 11. The heading of this clause is simply
“Other.”
97
   “As the Complaint states, [Chen and Luo] communicated the misrepresentations
from Duluth, Georgia, to [Patel] in Miami, Florida.” Pl.’s Opp. To Defs.’ Mot. to
Dismiss at 13, D.I. 14 (citing Compl. at ¶¶ 19-20, 76-87, D.I. 1).
98
    “One of the essential elements for fraud is justifiable reliance by the plaintiff.”
Condios, Inc. v. Driver, 145 Ga.App. 537, 538 (1978) (internal quotations omitted).
99
    Id. at 15.
                                           19
      Because Patel cannot establish all necessary elements to prove fraud,100

it appears with reasonable certainty that he would not be entitled to recover

under any reasonably conceivable set of circumstances on Count III - Fraud

in the Inducement.101 Juicy Crab’s motion as to Count III - Fraud in the

Inducement is GRANTED.

F.    Count IV - Negligent Misrepresentation

      Lastly, the Court turns to Juicy Crab’s motion as to Count IV - Negligent

Misrepresentation. In Legacy Academy, Inc. v. Mamilove, LLC,102 the Supreme

Court of Georgia held that separate fraud and negligent misrepresentation claims,

“which depended entirely on allegations of pre-contractual representations[,] [were]

precluded as a matter of law by [an] [a]greement’s merger clause.”103 The Supreme

Court of Georgia wrote:

      Under Georgia law, as a matter of law, a valid merger clause executed
      by two or more parties in an arm's length transaction precludes any
      subsequent claim of deceit based upon pre-contractual representations.
                                    …
      Where a conflict exists between oral and written representations, it has
      long been the law in Georgia that if the parties have reduced their
      agreement to writing, all oral representations made antecedent to

100
    “In order to prove fraud, the plaintiff must establish five elements: (1) a false
representation by a defendant, (2) scienter, (3) intention to induce the plaintiff to
act or refrain from acting, (4) justifiable reliance by plaintiff, and (5) damage to
plaintiff.” Summit Auto. Grp., LLC v. Clark, 298 Ga.App. 875, 880(3) (2009).
101
    Greenfield for Ford, 2017 WL 729769, at *2.
102
    297 Ga. 15 (2015).
103
    Id. at 20.
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      execution of the written contract are merged into and extinguished by
      the contract and are not binding upon the parties.

      Thus, where a written contract contains a comprehensive merger
      clause, prior or contemporaneous representations that contradict the
      written contract cannot be used to vary the terms of a valid written
      agreement purporting to contain the entire agreement of the parties, nor
      would the violation of any such alleged oral agreement amount to
      actionable fraud.104

This language makes it clear that any allegations relying on statements made before

or after the Employment Agreement went into effect, are precluded as a matter of

law by the merger clause. Here, the merger clause precludes Patel from relying on

Juicy Crab’s pre-contract representations to support his negligent misrepresentation

claim.105

      Patel argues that Juicy Crab had a duty of care against making false or

misleading statements to induce reliance to enter the Employment Agreement. This

argument is based on Restatement of Torts 2d, § 551(2)(b) (1977).106 Although

Georgia courts have not recognized that particular duty, the Supreme Court of

Georgia has recognized a similar duty based on the Restatement of Torts 2d, § 552

(1977).107 Nonetheless, Georgia law provides that negligent misrepresentation still

104
    Id. at 19-20 (internal citations and quotations omitted).
105
     Real Est. Int'l, Inc. v. Buggay, 220 Ga.App. 449, 451 (1996) (holding that
justifiable reliance is an essential element for both fraud and negligent
misrepresentation, and failure to meet that element bars those claims).
106
    Pl.’s Opp. to Defs.’ Mot. to Dismiss at 17, D.I. 14.
107
    “Under this standard, one who supplies information during the course of his
business, profession, employment, or in any transaction in which he has a pecuniary
                                        21
cannot withstand a merger clause, even when an independent duty has been adopted

by the courts and imputed to a defendant in the same case.108

      Patel cannot establish all necessary elements to prove negligent

misrepresentation because his claim is predicated on pre-contract representations

barred by the merger clause.109 Accordingly, it appears with reasonable certainty

that Patel would not be entitled to recover under any reasonably conceivable set of

interest has a duty of reasonable care and competence to parties who rely upon the
information in circumstances in which the maker was manifestly aware of the use to
which the information was to be put and intended that it be so used. This liability is
limited to a foreseeable person or limited class of persons for whom the information
was intended, either directly or indirectly. In making a determination of whether the
reliance by the third party is justifiable, we will look to the purpose for which the
report or representation was made. If it can be shown that the representation was
made for the purpose of inducing third parties to rely and act upon the reliance, then
liability to the third party can attach. If such cannot be shown there will be no liability
in the absence of privity, wilfulness [sic] or physical harm or property damage. The
additional duty that this rule imposes may be, of course, limited by appropriate
disclaimers which would alert those not in privity with the supplier of information
that they may rely upon it only at their peril.” Robert & Co. Assocs. v. Rhodes-
Haverty P'ship, 250 Ga. 680, 681 (1983).
108
    See Am. Casual Dining, L.P. v. Moe's Sw. Grill, L.L.C., 426 F. Supp. 2d 1356, 67-
68 (N.D. Ga. 2006) (holding that a plaintiff was not precluded from asserting a
negligent misrepresentation claim pursuant to Robert &Co. Assocs., but also that a
contract’s merger clause and an acknowledgment clause barred a negligent
misrepresentation claim that was based on pre contractual representations).
109
    The essential elements of a claim for negligent misrepresentation are: “(1) the
defendant's negligent supply of false information to foreseeable persons, known or
unknown; (2) such persons' reasonable reliance upon that false information; and (3)
economic injury proximately from such reliance.” Martin v. Chasteen, 354 Ga.App.
518, 552 (2020).
                                            22
circumstances on Count IV - Negligent Misrepresentation.110 Juicy Crab’s motion

as to Count IV - Negligent Misrepresentation is GRANTED.

                               V.    CONCLUSION

         THEREFORE, Defendants’ Motion to Dismiss is DENIED in part and

GRANTED in part. Defendants’ Motion to Dismiss Count I - Breach of Contract

is DENIED. Defendants’ Motion to Dismiss Count II - Breach of Implied Covenant

of Good Faith and Fair Dealing is DENIED. Defendants’ Motion to Dismiss Count

III- Fraud in the Inducement is GRANTED. Defendants’ Motion to Dismiss Count

IV - Negligent Misrepresentation is GRANTED.

         IT IS SO ORDERED.

                                                    /s/ Ferris W. Wharton
                                                     Ferris W. Wharton, J.

110
      Greenfield for Ford, 2017 WL 729769, at *2.
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