`
`
`
`
`Mark O. Morris (4636)
`Snell & Wilmer L.L.P.
`15 West South Temple, Suite 1200
`Salt Lake City, UT 84101
`Telephone: (801) 257-1900
`Facsimile: (801) 257-1800
`Email: mmorris@swlaw.com
`Attorney for Defendant
`True North of Utah, LLC
`
`
`THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF UTAH, CENTRAL DIVISION
`
`
`
`Plaintiff,
`
`
`JLPR, LLC, a Utah limited
`liability company;
`
`
`
`vs.
`
`Utah Department of Agriculture and Food,
`Utah Division of Purchasing, General
`Services, The State of Utah, Scott Ericson,
`Kerry Gibson, Kelly Pehrson, Andrew Rigby,
`Cody James, Natalie Callahan, Mellissa Ure,
`Brandy Grace, Christopher W. Hughes, Mark
`Anderson, Zac Christensen, Stephanie Casta,
`Standard Wellness Utah, LLC, and True
`North of Utah, LLC,
`
`
`
`Case No. 2:21-cv-00436
`
`MOTION TO DISMISS ALL CLAIMS
`AGAINST DEFENDANT TRUE NORTH
`OF UTAH, LLC
`
`Hon. Ted Stewart
`
`(Oral Argument Requested)
`
`Defendants.
`
`Defendant True North of Utah, LLC, (“True North”) moves the Court pursuant to Fed. R.
`Civ. P. 9(b) and 12(b)(6) to dismiss the Sixth Cause of Action, and only claim against Truth North
`in JLPR, LLC’s (“Plaintiff’s”) Complaint, because it fails to plead this claim with particularity
`and fails state a claim upon which relief can be granted. Alternatively, if the Court is not inclined
`to dismiss this claim, True North moves, pursuant to Fed. R. Civ. P. 12(e), for an order that Plaintiff
`provide a more definite and, importantly, factual statement.
`
`
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`Case 2:21-cv-00436-TS-DAO Document 5 Filed 08/05/21 PageID.51 Page 2 of 14
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`TABLE OF CONTENTS
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`Page
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`
`INTRODUCTION .......................................................................................................................... 1
`ARGUMENT ................................................................................................................................. 2
`I.
`STANDARD ON A MOTION TO DISMISS ........................................................ 2
`II.
`PLAINTIFF DOES NOT STATE A CLAIM FOR CIVIL CONSPIRACY .......... 2
`Plaintiff Did Not Properly Allege an Underlying Tort. ......................................... 2
`Plaintiff’s Civil Conspiracy Claim Lacked Particularity. . ..................................... 3
`Plaintiff Failed to State a Claim for Civil Conspiracy. ........................................... 4
`Plaintiff Failed to Properly Allege a “Meeting of the Minds.” .................. 6
`1.
`Plaintiff Failed to Properly Allege an “Illegal, Overt Act.” ...................... 7
`2.
`ALTERNATIVELY, THE COURT SHOULD ORDER A MORE DEFINITE
`STATEMENT ......................................................................................................... 8
`CONCLUSION ....................................................................................................... 8
`
`III.
`
`IV.
`
`A.
`B.
`C.
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`Case 2:21-cv-00436-TS-DAO Document 5 Filed 08/05/21 PageID.52 Page 3 of 14
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`Federal Cases
`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`Ashcroft v. Iqbal,
`556 U.S. 662 (2009) .................................................................................................................... 2
`Bell Atl. Corp. v. Twombly,
`550 U.S. 544 (2007) ................................................................................................................ 2, 6
`Celtig, LLC v. Patey,
`347 F.Supp.3d 976 (D. Utah 2018) ............................................................................................. 2
`Garth O. Green Entrps., Inc. v. Harward,
`No. 2:15-cv-00556, 2017 WL 1184024 (D. Utah Mar. 29, 2017) .............................................. 2
`Griffin v. Breckenridge,
`403 U.S. 88 (1971) ...................................................................................................................... 3
`Kansas Penn Gaming, LLC v. Collins,
`656 F.3d 1210 (10th Cir. 2011) .................................................................................................. 2
`Montgomery v. City of Ardmore,
`365 F.3d 926 (10th Cir. 2004) ................................................................................................ 4, 7
`Robbins v. Oklahoma,
`519 F.3d 1242 (10th Cir. 2008) .................................................................................................. 6
`Sposi v. Santa Clara City, Utah,
`No. 2:17-cv-1057-CW, 2018 WL 1578038 (D. Utah Mar. 27, 2018) ........................................ 8
`Sugenex, LLC v. Predictive Therapeutics,
`LCC, 462 F.Supp3d 1160 (D. Utah 2020) .................................................................................. 5
`Tilton v. Richardson,
`6 F.3d 683 (10th Cir. 1993) ........................................................................................................ 3
`Unified Container, LLC v. Mazuma Capital Corp.,
`280 F.R.D. 632 (D. Utah 2012) .................................................................................................. 4
`World Wide Assoc. of Specialty Programs v. Pure, Inc.,
`450 F.3d 1132 (10th Cir. 2006) .................................................................................................. 6
`
`State Cases
`
`Coroles v. Sabey,
`79 P.3d 974 (Utah Ct. App. 2003) .............................................................................................. 4
`Estrada v. Mendoza,
`275 P.3d 1024 (Utah Ct. App. 2012) ...................................................................................... 2, 3
`Israel Pagan Estate v. Cannon,
`746 P.2d 785 (Utah App. 1987) .................................................................................................. 6
`Pohl, Inc. of Am.,
`201 P.3d 944 (Utah 2008) ........................................................................................................... 4
`ii
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`Federal Statutes
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`42 U.S.C. § 1983 ............................................................................................................................. 3
`42 U.S.C. § 1985 ............................................................................................................................. 3
`
`Federal Rules
`
`Fed. R. Civ. P. 8(a) ......................................................................................................................... 1
`Fed. R. Civ. P. 9(b) ............................................................................................ Introduction, 1, 4, 9
`Fed. R. Civ. P. 12(b)(6).......................................................................................... Introduction, 2, 9
`Fed. R. Civ. P. 12(e) ................................................................................................................... 1, 2
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`iii
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`Case 2:21-cv-00436-TS-DAO Document 5 Filed 08/05/21 PageID.54 Page 5 of 14
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`INTRODUCTION
`The Complaint literally stated no claim against True North upon which relief may be
`granted, and thus this Court should dismiss the Complaint as to True North. Dissatisfied with its
`unsuccessful bid at obtaining a coveted license to cultivate medical cannabis in Utah via a highly
`competitive process, Plaintiff’s scorched-earth Complaint blindly cast blame on nearly everyone
`involved in the selection process—seventeen separate defendants—including successful
`applicants, like defendant True North. But despite the medley of generically pled federal and state
`claims in Plaintiff’s 41-page Complaint, few allegations involve Truth North. In fact, Plaintiff’s
`only cause of action against True North, which also included all of the other defendants, is an
`obscure and factually vapid claim of civil conspiracy.
`What is most notable about Plaintiff’s civil conspiracy claim, with respect to True North,
`is what it failed to include. Plaintiff did not allege, with any specificity, that representatives of True
`North came to an agreement or a meeting of the minds with anyone, or that they engaged in an
`illegal, overt act in furtherance of a conspiracy in a way that detrimentally impacted Plaintiff.
`Indeed, the Complaint contained no allegations regarding which individuals at True North engaged
`in the alleged conspiracy, where an agreement was made, when it was made, and what it
`specifically entailed. On the contrary, Plaintiff’s allegations against True North were nothing more
`than blanket and generic recitations of the elements of a civil conspiracy claim.
`Plaintiff’s failure to allege any specific facts to support a viable claim of civil conspiracy
`against True North demonstrated that Plaintiff only intends to engage in a prolonged fishing
`expedition, hoping to ultimately uncover nefarious behavior among the successful applicants who
`were awarded a cultivation license. In doing so, Plaintiff’s barren allegations against True North
`in its Sixth Cause of Action are not sufficient to meet the pleading standards set forth in Fed. R.
`Civ. P. 8(a), much less the heighted pleading requirements in Fed. R. Civ. P. 9(b) that apply here.
`In addition, the deficient allegations failed also to state a claim for civil conspiracy, and thus this
`Court should dismiss them pursuant to Fed. R. Civ. P. 12(b)(6) as set forth more fully below.
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`ARGUMENT
`
`I.
`
`STANDARD ON A MOTION TO DISMISS
`To satisfy Rule 8 and survive a motion to dismiss, a complaint must contain sufficient
`factual allegations which, if accepted as true, “state a claim to relief that is plausible on its
`face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S.
`544, 570 (2007)). When considering a motion to dismiss, the court assumes the truth of well-pled
`allegations, but disregards conclusory statements of law. Kansas Penn Gaming, LLC v. Collins,
`656 F.3d 1210, 1214 (10th Cir. 2011). “Legal conclusions and opinions are not accepted, even if
`couched as facts.” Garth O. Green Entrps., Inc. v. Harward, No. 2:15-cv-00556, 2017 WL
`1184024, at *2 (D. Utah Mar. 29, 2017). This is because “[s]atisfying the basic pleading
`requirements of the federal rules ‘demands more than the unadorned, the defendant-unlawfully-
`harmed-me accusation. A pleading that offers ‘labels and conclusions’ or a ‘formulaic recitation
`of the elements of a cause of action will not do.”’ Id. (quoting Iqbal, 556 U.S. at 678). ‘“Naked
`assertions devoid of further factual enhancement’ do not state a claim sufficiently to survive a
`motion to dismiss.” Id. (quoting Iqbal, 556 U.S. at 678). The very few paragraphs in the Complaint
`that actually contain the words “Truth North” constitute the very definition of these categories of
`deficient allegations.
`
`II.
`
`PLAINTIFF DOES NOT STATE A CLAIM FOR CIVIL CONSPIRACY
`A.
`Plaintiff Did Not Properly Allege an Underlying Tort.
`Participation in a civil conspiracy is not, by itself an actionable tort. Celtig, LLC v. Patey,
`347 F.Supp.3d 976, 986 (D. Utah 2018). Rather, a civil conspiracy claim requires that “a plaintiff
`show that the defendant participated in an underlying tort.” Id. (citing Estrada v. Mendoza, 275
`P.3d 1024, 1029 (Utah Ct. App. 2012)). Here, Plaintiff’s Sixth Cause of Action is so devoid of
`specificity, it is entirely unclear what underlying tort, if any, True North is alleged to have
`participated in. Indeed, an underlying tort is not specifically described in the Sixth Cause of Action,
`nor is a single federal or state statute cited with respect to this claim. (See Dkt. No. 2 at ¶¶ 182-89)
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`Plaintiff’s Complaint generally alleges that all defendants “conspired and acted under the
`color of law to deprive Plaintiff of its federal protected constitutional rights” pursuant to 42 U.S.C.
`§§ 1983 and 1985. (Id. at ¶ 21) But this allegation is not specifically included within the Sixth
`Cause of Action. (Id. at ¶¶ 182-89) And even assuming that the Sixth Cause of Action were to
`mention and constitute a federal civil rights conspiracy claim under §§ 1983 and 1985, it fails to
`allege a proper protected status. Federal civil rights conspiracy claims do not “apply to all tortious,
`conspiratorial interferences with the rights of others,” but rather, only to conspiracies motived by
`“some racial, or perhaps otherwise class-based, invidiously discriminatory animus.” Tilton v.
`Richardson, 6 F.3d 683, 686 (10th Cir. 1993) (citing Griffin v. Breckenridge, 403 U.S. 88, 102
`(1971)). Here, Plaintiff’s Complaint failed to allege any racial, class-based, or other discriminatory
`animus. Nor could it. Thus, the Sixth Cause of Action cannot and does not constitute a valid federal
`civil rights conspiracy claim under §§ 1983 and 1985.
`The Complaint also generally alleged that some of the defendants—not including True
`North—violated Plaintiff’s rights under Utah law and the State Constitution. (Id. at 138-81) But
`again, none of these allegations were specifically included within Plaintiff’s Sixth Cause of Action.
`Indeed, the Complaint did not include any allegations that True North conspired to engage any
`behavior that would deprive Plaintiff of rights conferred to it under Utah law or the State
`Constitution. Thus, with respect to True North, because Plaintiff has “not adequately pleaded any
`of the basic torts they allege … dismissal of their civil conspiracy claim is appropriate.” Estrada,
`275 P.3d at 1029 (citation omitted).
`
`B.
`Plaintiff’s Civil Conspiracy Claim Lacked Particularity.
`Where the unlawful act underlying the civil conspiracy is a fraud-based tort, both the
`underlying tort and the civil conspiracy claim must be pleaded with particularity pursuant to Fed.
`R. Civ. P. 9(b). Unified Container, LLC v. Mazuma Capital Corp., 280 F.R.D. 632, 636-37 (D.
`Utah 2012); see also Coroles v. Sabey, 79 P.3d 974, 984 (Utah Ct. App. 2003) (Where civil
`conspiracy is predicated on fraud it “must be pleaded with particularity, even though in this context
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`the fraud is simply an element of the [civil conspiracy] claim rather than the claim itself.”)
`Although Plaintiff did not specify an underlying tort, the Complaint alleged that various defendants
`engaged in a litany of fraudulent acts to deprive Plaintiff of a license to cultivate medical cannabis
`in Utah. These fraud-based allegations include, without names, dates, places, actions, or context,
`“improper influence” of the selection process (Dkt. No. 2 at ¶¶ 42-53), manipulation of the
`selection process to benefit particular applicants (Id. at ¶¶ 54-74), intentional misapplication of
`scoring criteria (Id. at ¶¶ 75-90), and “illegal collusion” to select “favored applicants” (Id. at ¶¶
`91-101). While none of these allegations are specifically tied to True North, the heightened
`pleading requires of Fed. R. Civ. P. 9(b) nonetheless apply to Plaintiff’s Sixth Cause of Action.
`And, as described in detail below, Plaintiff’s single claim against Truth North failed to meet Fed.
`R. Civ. P. 9(b)’s pleading requirements, and this Court should dismiss it.
`
`C.
`Plaintiff Failed to State a Claim for Civil Conspiracy.
`The elements of a prima facie case for civil conspiracy pursuant to Utah law are: “(1) a
`combination of two or more persons, (2) an object to be accomplished, (3) a meeting of the minds
`on the object or course of action, (4) one or more unlawful, overt acts, and (5) damages as a
`proximate result thereof.” Pohl, Inc. of Am., 201 P.3d 944, 954-55 (Utah 2008). These allegations
`must include “specific facts showing an agreement and concerted action amongst the defendants”
`and “the manner in which the conspiracy operated.” Montgomery v. City of Ardmore, 365 F.3d
`926, 940 (10th Cir. 2004) (internal citations omitted) (emphasis added). Plaintiff’s allegations
`against Truth North, even when viewed as true, do not satisfy the “meeting of the minds” and the
`“one or more unlawful, overt acts” element of this cause of action.1
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`1 Plaintiffs also failed to allege other elements of their claim. However, the obvious absence of
`allegations sufficient to allege a “meeting of the minds” and “one or more unlawful, overt acts” is
`sufficient alone to warrant dismissal of the claim.
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`The sole allegations in Plaintiff’s 41-page Complaint that involve True North are:
` “True North conspired with the other Defendants, including state officials, to
`deprive JLPR of its federally protected rights.” [Dkt. No. 2 at ¶ 18]
` “Department Commissioner Kerry Gibson was shown in a photograph meeting
`with Mike Standlee and Bill Stevens of successful applicant True North of Utah
`during the application process opened.” [Id. ¶ 106]
` “The unlawful and overt acts described above were committed in furtherance of a
`common design, intention, or purpose by each of the Defendants.” [Id. ¶ 183]
` “Specifically, there was a meeting of the mind between each of the Defendants
`with at least one other Defendant to accomplish the object of assuring that certain
`favored applicants receive cultivation licenses and to thereby deprive JLPR of
`obtaining a cultivation license.” [Id. ¶ 184]
` “Defendant True North agreed with various persons at the DAF around May or
`June of 2019 to ensure that their companies would illegally obtain a cultivation
`license.” [Id. ¶ 186]
` “To accomplish these ends, the conspiring Defendants agreed to and engaged in
`numerous unlawful, overt acts.” [Id. ¶ 188]
`That is it . . . all of the claims against True North in the Complaint. Paragraphs 18, 183,
`184, and 188 are mere “labels and conclusions” which the Court must disregard. For example,
`Plaintiff includes all seventeen defendants in paragraph 18 in a non-specific attempt at alleging a
`conspiracy. But “[a] plaintiff may not merely declare that the defendants conspired together and
`hope to defeat a motion to dismiss.” Sugenex, LLC v. Predictive Therapeutics, LLC, 462 F.Supp3d
`1160, 1176 (D. Utah 2020) (citing Twombly, 550 U.S. at 556-57.) The Tenth Circuit has
`emphasized that “[t]he Twombly Court was particularly critical of complaints that ‘mentioned no
`specific time, place, or person involved in the alleged conspiracies.’” Robbins v. Oklahoma, 519
`F.3d 1242, 1248 (10th Cir. 2008). The Court made clear that when dealing with “complex claims
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`against multiple defendants,” it is “particularly important … that the complaint make clear exactly
`who is alleged to have done what to whom, to provide each individual with fair notice as to the
`basis of the claims against him or her, as distinguished from collective allegations ….” Id. at 1249-
`50 (emphasis in original). The Complaint comes nowhere near this standard.
`Plaintiff’s allegations against Truth North directly contradicted the aforementioned Tenth
`Circuit jurisprudence. With respect to a majority of these allegations, Plaintiff did not bother to
`distinguish True North’s actions from those of the other defendants. On the contrary, Plaintiff
`merely lumped each defendant together, and recited the basic elements of a civil conspiracy claim.
`These allegations lack any specificity, and therefore, deprive Truth North of fair notice of the basis
`of the claims asserted against it.
`
`Plaintiff Failed to Properly Allege a “Meeting of the Minds.”
`1.
`While paragraph 186 vaguely suggests that True North agreed with “various persons at the
`DAF” in order to “illegally obtain a cultivation license”, this claim is wholly unsupported by any
`specific facts. There are no allegations regarding (a) which individuals at True North and DAF
`made an agreement; (b) where the agreement was made; and most importantly, (c) the manner in
`which the agreement was to operate. “While it is not necessary to provide direct evidence of a
`formal agreement in order to demonstrate a meeting of the minds, ‘there must be substantial proof
`of circumstances from which it reasonably follows, or at least may be reasonably inferred, that the
`conspiracy existed.’” World Wide Assoc. of Specialty Programs v. Pure, Inc., 450 F.3d 1132, 1141
`(10th Cir. 2006) (quoting Israel Pagan Estate v. Cannon, 746 P.2d 785, 790 (Utah Ct. App. 1987)).
`“[C]onjecture and speculation alone are not sufficient to establish that the conspiracy existed.” Id.
`Plaintiff’s allegation that Truth North agreed with “various persons” at DAF is grossly
`deficient to establish, or even imply, that a meeting of the minds actually existed. Further, the
`suggestion that the agreement was to illegally obtain a cultivation license lacks any specificity. For
`example, there are no allegations that describe what acts anyone from True North agreed to
`perform in order to “illegally obtain” such a license. Put simply, it fails to state who specifically is
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`alleged to have done what to whom. This is precisely the type of conjecture that both the United
`States Supreme Court and the Tenth Circuit held was legally insufficient to properly allege a civil
`conspiracy claim and thus avoid dismissal. Thus, these bare allegations did not meet the pleading
`standards required to properly allege that a meeting of the minds occurred, and this Court should
`dismiss them.
`
`Plaintiff Failed to Properly Allege an “Illegal, Overt Act.”
`2.
`Paragraph 188 described the alleged unlawful, overt acts it believes the defendants engaged
`in, as it related to the alleged conspiracy:
`
`
`The former Deputy Commissioner of the Department of Agriculture Standard Wellness
`and Scott Ericson illegally communicating with Department of Agriculture Evaluators
`to ensure that Standard Wellness obtained a license; Mr. Ericson, the Department of
`Agriculture, and the Evaluators setting up and applying a sub rosa system of evaluation
`contrary to statute that would ensure the selection of Standard Wellness; The
`Evaluators and Department of Agriculture Management setting up and applying a sub
`rosa system of evaluation contrary to statute each colluding in scoring to ensure the
`selection of favored applicants; Evaluators improperly communicating with applicants
`during the evaluation process; Evaluators and Procurement Board member Mark
`Anderson failing to disclose conflicts of interest with successful applicants while
`rendering decisions favoring their client/conflicts and which were detrimental to
`Plaintiff; the other members of the Procurement Board ratifying and acquiescing to the
`acts of Mr. Anderson when they joined in with him in denying Plaintiff’s Protest
`Appeal, in spite of this clear conflict of interest; Department Commissioner Kerry
`Gibson meeting with a successful applicant during the application process; among
`others.
`(Dkt. No. 2 at ¶ 188). True North is nowhere in this. Not one of these examples included any
`actions taken by any representatives of True North. See Montgomery, 365 F.3d at 940 (finding that
`the plaintiff’s civil conspiracy claim was deficient because he “merely alleged many unlawful acts
`by various defendants and stated, without any specific facts evincing an agreement among the
`various defendants, that they conspired against him.”)
`Among the purportedly unlawful, overt acts alleged in the Complaint, none include any
`specific examples in which True North improperly influenced or manipulated the selection
`process, or that they “illegally colluded” without anyone to obtain a cultivation license. The mere
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`allegation that some individuals appeared on a photograph (Dkt. No. 2 at ¶ 186) does not support
`Plaintiff’s claim that a meeting of the minds occurred or that True North committed an unlawful,
`overt act. Again, Plaintiff failed to include any specific facts that suggest where the meeting
`occurred, what was discussed, what agreement was made (if any), and whether there was indeed
`an unlawful, overt act. Thus, these “naked assertions devoid of further factual enhancement” do
`not state a claim, and this Court should dismiss the Sixth Cause of Action.
`III. ALTERNATIVELY, THE COURT SHOULD ORDER A MORE DEFINITE
`STATEMENT
`Dismissal is appropriate. If this Court is inclined to provide another opportunity to Plaintiff
`to allege, now, a factual basis for any claims against True North, True North alternatively requests
`the Court order Plaintiff to provide a more definite statement of its claim. Rule 12(e) provides that
`“[a] party may move for a more definite statement of a pleading to which a responsive pleading is
`allowed but which is so vague or ambiguous that the party cannot reasonably prepare a response.”
`As described above, Plaintiff’s Complaint failed to provide factual allegations to provide True
`North with fair notice regarding the nature of Plaintiff’s claims against it—such as who from True
`North and any other entity had a “meeting of the minds” and who from True North committed an
`unlawful, over act. See Sposi v. Santa Clara City, Utah, No. 2:17-cv-1057-CW, 2018 WL
`1578038, at *1 (D. Utah Mar. 27, 2018) (“Pleadings are meant to provide a party fair notice about
`the nature of a claim.”); Phillip M. Adams & Assocs., L.L.C. v. Dell, Inc., No. 1:05-cv-64-TS, 2008
`200340, at *1 (D. Utah Jan. 22, 2008) (granting a motion for more definite statement because the
`complaint left the moving party “in the dark without a specific allegation of which of their products
`[allegedly infringed on a patent]”). This is the bare minimum this Court should order.
`IV. CONCLUSION
`For the reasons stated above, this Court should dismiss Plaintiff’s Sixth Cause of Action
`against True North for failing to plead a civil conspiracy claim with particularity a under Fed. R.
`Civ. P. 9(b) and for failing to state a claim on which relief can be granted under Fed. R. Civ. P.
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`12(b)(6). Alternatively, True North this Court should order Plaintiff to provide a more definite
`statement regarding its one and only claim against True North.
`DATED: August 5, 2021.
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`SNELL & WILMER L.L.P.
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`/s/ Mark O. Morris
`Mark O. Morris
`True North of Utah, LLC
`Attorney for Defendant
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`CERTIFICATE OF SERVICE
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`I hereby certify that on this 5th day of August, 2021, a true and correct copy of the
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`foregoing MOTION TO DISMISS was electronically filed with the Clerk of Court and served
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`on the following using the Court’s electronic filing system:
`
`Jason M. Kerr (8222)
`Steven Garff (13707)
`PRICE, PARKINSON & KERR
`5742 W. Harold Gatty Drive
`Salt Lake City, UT 84116
`Telephone: (801) 517-7088
`E-mail: jasonkerr@ppktrial.com
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`stevengarff@ppktrial.com
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`Attorneys for Plaintiff
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`Mark O. Morris
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