NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 13-3756
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REGINELLA CONSTRUCTION COMPANY, LTD,
Appellant
v.
TRAVELERS CASUALTY & SURETY COMPANY OF AMERICA
_____________
On Appeal from the United States District Court
for the Western District of Pennsylvania
District Court No. 2-12-cv-01047
District Judge: The Honorable Mark R. Hornak
Submitted Pursuant to Third Circuit L.A.R. 34.1(a)
May 13, 2014
Before: SMITH, VANASKIE, and SHWARTZ, Circuit Judges
(Filed: June 11, 2014 )
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OPINION
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SMITH, Circuit Judge.
Plaintiff Reginella Construction Company, Ltd. appeals two orders of the
District Court: (1) the order dismissing its complaint; and (2) the order denying its
motion to alter or amend judgment or, in the alternative, for leave to file an
amended complaint. For the reasons that follow, we will affirm.
I.
Reginella is a Pittsburgh-based construction company that performs mutli-
million dollar public construction projects and has been in business for over
twenty-five years. In 2010–2011, Reginella entered into contracts with (1) the
Moon Area School District (―MASD‖), for conversion of a high school into a
middle school, (―Moon Project‖) and (2) the Ohio Turnpike Commission (―OTC‖),
for re-construction of two service plazas (―Ohio Project‖). Defendant Travelers
Casualty and Surety Company of America provided bonding for both projects.
Travelers signed these bonding contracts against the backdrop of a General
Indemnification Agreement (―GIA‖) it had entered into with Reginella in June
2009. The GIA provided that if certain triggering events occurred—such as
Reginella defaulting on any contract bonded by Travelers, or Reginella breaching
the GIA itself—Reginella would transfer a number of rights to Travelers,
including, inter alia, the right to take possession of the work under any bonded
contract, to take possession of Reginella’s property, and to take possession of
funds owed to Reginella under any bonded contract.
On April 26, 2012, Travelers sent a letter to MASD demanding payments
owed to Reginella on the Moon Project. Travelers urged MASD that it was
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contractually entitled to these payments because Reginella had defaulted on a
number of its subcontracts and the aggrieved subcontractors had asserted claims
against Travelers on the Moon Project’s payment bond. After receiving this letter,
MASD refused to remit payment to either Reginella or Travelers until the parties
agreed which company was entitled to payment. Reginella alleges that after
Travelers sent this letter, Travelers informed Reginella’s subcontractors that
MASD was going to terminate Reginella from the Moon Project. According to
Reginella, this information caused the subcontractors to breach their subcontracts
by slowing down, stopping work, and submitting inflated and premature claims
against Reginella. On June 11, 2012, Reginella, having yet to receive payment
from MASD, terminated the Moon Project contract.
During the same time period, problems arose on the Ohio Project. In
November 2011, Reginella terminated a subcontractor for failing to perform its
contractual obligations, and this subcontractor filed a lien against the Ohio Project.
In response, OTC withheld payment from Reginella in the amount of the lien until
Reginella provided a lien-over bond from a surety. Reginella asked Travelers to
provide this lien-over bond, arguing that it had a continuing obligation to do so
under the Ohio Project’s contract bond. Travelers disagreed and refused to provide
the bond, arguing that OTC should release payment without the lien-over bond or
that Reginella should obtain this bond from another surety. Negotiations stalled,
and as OTC continued to withhold payment from Reginella, Reginella became
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unable to pay its subcontractors, causing delays in the project. On May 22, 2012,
OTC terminated Reginella from the Ohio Project.
On July 26, 2012, Reginella filed a complaint against Travelers in the United
States District Court for the Western District of Pennsylvania. With respect to the
Moon Project, the complaint alleges four tort claims: (1) intentional interference
with the Moon Project construction contract; (2) intentional interference with the
Moon Project subcontracts; (3) breach of fiduciary duty; and (4) bad faith. With
respect to the Ohio Project, the complaint alleges two tort claims: (1) breach of
fiduciary duty; and (2) bad faith. The complaint does not allege any breach of
contract claims and makes no reference to the GIA between Travelers and
Reginella.
Travelers filed a motion to dismiss, which the District Court granted on May
30, 2013. The District Court dismissed Reginella’s claims for breach of fiduciary
duty because it found that no fiduciary relationship existed between Travelers and
Reginella. The District Court dismissed Reginella’s claims for intentional
interference with contractual relations and bad faith on the basis of the ―gist of the
action‖ doctrine, which it invoked sua sponte.
On June 28, 2013, Reginella moved to alter or amend the judgment or, in the
alternative, to amend its complaint to include breach of contract claims. The
District Court denied this motion on September 5, 2013. This timely appeal
followed.
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II.1
We agree with the District Court that Pennsylvania law controls the
disposition of this case. There is no doubt that Pennsylvania law applies to
Reginella’s claims relating to the Moon Project. These claims arise from business
relationships entered into and carried out in Pennsylvania for the benefit of a
Pennsylvania municipal entity. With respect to Reginella’s two claims relating to
the Ohio Project, we also agree that there is no actual conflict between
Pennsylvania and Ohio law on the issue of whether Reginella can assert a breach
of fiduciary duty or bad faith claim against Travelers.2 Accordingly, for the sake
of convenience, this opinion will apply only Pennsylvania law.
We also agree with the District Court that Reginella failed to plead facts that
could support a breach of fiduciary duty claim under Pennsylvania law. Nothing in
1
The District Court had jurisdiction pursuant to 28 U.S.C. § 1332(a)(1). We
exercise jurisdiction pursuant to 28 U.S.C. § 1291. ―Our standard of review of the
district court’s dismissal under Rule 12(b)(6) of the Federal Rules of Civil Procedure is
plenary. When considering a Rule 12(b)(6) motion, we are required to accept as true all
allegations in the complaint and all reasonable inferences that can be drawn therefrom,
and view them in the light most favorable to the plaintiff.‖ Evancho v. Fisher, 423 F.3d
347, 350 (3d Cir. 2005) (internal citations omitted). We review a district court’s denial of
a motion to alter or amend the judgment for abuse of discretion, except that when ―the
court’s denial [is] based upon the interpretation and application of a legal precept, review
is plenary.‖ Koshatka v. Philadelphia Newspapers, Inc., 762 F.2d 329, 333 (3d Cir.
1985). We review the district court’s denial of leave to amend a complaint for abuse of
discretion. Kanter v. Barella, 489 F.3d 170, 175 (3d Cir. 2007).
2
Reginella contends that factual development was needed to determine which
state’s laws properly applied. Because the District Court determined that Ohio and
Pennsylvania laws do not actually conflict, however, these factual determinations were
unnecessary.
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Reginella’s complaint suggests that its relationship with Travelers went ―beyond
mere reliance on superior skill, and into a relationship characterized by
overmastering influence on one side or weakness, dependence, or trust, justifiably
reposed on the other side.‖ Winiski v. Brown & Brown Ins. Co. of PA, 906 A.2d
571, 577 (Pa. Super. Ct. 2006) (internal quotation marks and citation omitted).
The complaint explains that Reginella is a large and well-established contractor
that has performed multi-million dollar public construction contracts for years.
J.A. 54. In fact, the complaint reveals that Reginella terminated its relationship
with Travelers in order to enter a relationship with a new surety on more favorable
terms. Id. at 53-54. In short, the complaint depicts a typical arms-length
relationship between a contractor and a surety.3
Further, we agree with the District Court that Reginella’s claims for
intentional interference with contractual relations and bad faith are barred by
Pennsylvania’s ―gist of the action‖ doctrine.4 Upon consideration of the bonding
contracts and the GIA,5 it is clear that Travelers’s allegedly tortious actions were
3
The District Court also concluded that the Pennsylvania Supreme Court would not
hold that a contractor/surety relationship was a fiduciary relationship as a matter of law.
Reginella does not challenge this ruling on appeal.
4
The ―gist of the action‖ doctrine ―precludes plaintiffs from re-casting ordinary
breach of contract claims into tort claims.‖ eToll, Inc. v. Elias/Savion Adver., Inc., 811
A.2d 10, 14 (Pa. Super. Ct. 2002). As the Pennsylvania Superior Court has explained,
―[t]o permit a promisee to sue his promisor in tort for breaches of contract . . . would
erode the usual rules of contractual recovery and inject confusion into our well-settled
forms of actions.‖ Bash v. Bell Tel. Co., 601 A.2d 825, 829 (Pa. Super. Ct. 1992).
5
Reginella also argues that the District Court’s consideration of the GIA was
inappropriate. We see no error here. It is true that when deciding a motion to dismiss,
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taken in pursuit of its perceived contractual rights and obligations. Thus, ―the
success of [Reginella’s claims] is wholly dependent on the terms of [the]
contract[s]‖ between the parties—namely, the GIA and subsequent bonding
contracts. eToll, Inc. v. Elias/Savion Adver., Inc., 811 A.2d 10, 19 (Pa. Super. Ct.
2002). Accordingly, dismissal of these claims was appropriate.
Finally, we conclude that the District Court did not abuse its discretion by
denying Reginella’s motion to amend its complaint. It was within the District
Court’s discretion to determine that granting Reginella’s motion would reward
undue delay by encouraging Reginella’s ―wait-and-see‖ tactics. Further, Reginella
is presently pursuing breach of contract counterclaims against Travelers in the
Allegheny County Court of Common Pleas. Travelers Cas. and Sur. Co. of Am. v.
Reginella Constr. Co., Ltd., et al., GD No. 12-012196.
III.
―courts generally consider only the allegations contained in the complaint, exhibits
attached to the complaint and matters of public record.‖ Pension Ben. Guar. Corp. v.
White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). A court, however, ―may
consider an undisputedly authentic document that a defendant attaches as an exhibit to a
motion to dismiss if the plaintiff’s claims are based upon that document. Otherwise, a
plaintiff with a legally deficient claim could survive a motion to dismiss simply by failing
to attach a dispositive document on which it relied.‖ Id. (internal citations omitted).
Reginella does not dispute the authenticity of the GIA, and we agree with the District
Court that Reginella’s claims are necessarily ―based upon‖ this document. J.A. 14
(―Reginella cannot bring claims against Travelers for its alleged behavior during their
business relationship, yet protest the Court’s full review of the legal nature of that
relationship.‖); see also id. (explaining that review of the GIA is essential to determining
whether a fiduciary relationship existed between the parties, and whether Travelers was
contractually authorized to engage in its allegedly tortious behavior).
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For the reasons stated, we will affirm the judgment of the District Court.
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