JOHNSON v. EVERETT, 2024 NCBC 1

STATE OF NORTH CAROLINA
WAKE COUNTY
IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
23 CVS 9976
RANDALL JOHNSON; KENNETH
CRAIG WILSON; MARK ALAN
DEVORE; LUIS MARCELO
ZANETTI; WILLIAM JAMES FORD;
and RICHARD FORD,
Plaintiffs,
v.
FRANCIS EVERETT; CATHIE
EVERETT; CONVERT-A-STAIR,
L.L.C.; FJ STAIRWAYS, LLC; and
BRIAN ESTES, jointly and severally,
Defendants.
ORDER AND OPINION ON
DEFENDANT BRIAN ESTES’
MOTION FOR JUDGMENT
ON THE PLEADINGS
THIS MATTER is before the Court on Defendant Brian Estes’ Motion for
Judgment on the Pleadings (“Motion,” ECF No. 35). 	The Court, having considered
the Motion, the parties’ briefs, the arguments of counsel, and all appropriate matters
of record, CONCLUDES that the Motion should be GRANTED, in part, and
DENIED, in part.
Vann Attorneys, PLLC, by James R. Vann and Ian Richardson, for Plaintiffs
Randall Johnson, Kenneth Craig Wilson, Mark Alan Devore, Luis Marcelo
Zanetti, William James Ford, and Richard Ford.
Buckmiller, Boyette & Frost, PLLC, by Matthew W. Buckmiller, for Defendants
Francis Everett and Cathie Everett.
Michael Best & Friedrich LLP, by Justin G. May and Luke Taylor, for
Defendant Convert-A-Stair, L.L.C.
No counsel appeared for Defendant FJ Stairways, LLC.
Ward 	and 	Smith, 	P.A., 	by 	Alexander 	C. 	Dale 	and 	Luke 	Tompkins, 	for
Defendant Brian Estes.
Johnson v. Everett, 2024 NCBC 1.

INTRODUCTION
1. 	The plaintiffs in this action allege that they invested in a company called
FJ Stairways, LLC (“FJ Stairways”) that sought to obtain a patent for a “pre-
fabricated stair box system that would revolutionize the home building industry.”
(Compl. ¶ 15, ECF No. 3.) Unbeknownst to the plaintiffs, the founding member of FJ
Stairways subsequently created a new company, Convert-A-Stair, L.L.C. (“CAS”),
that was a direct competitor of FJ Stairways and benefitted from FJ Stairways’ assets
(including the plaintiffs’ funds). 	The founding member ultimately assigned the
patent to CAS rather than to FJ Stairways. 	Plaintiffs have sued the founding
member and his wife on multiple theories, but those claims are not implicated by the
present Motion. 	Instead, the sole issue presently before the Court is whether
judgment on the pleadings should be granted in favor of an additional defendant,
Brian Estes, who assisted in the formation of CAS and was allegedly involved in its
operations that took place to the detriment of FJ Stairways.
FACTUAL AND PROCEDURAL BACKGROUND
2. 	“The Court does not make findings of fact on motions for judgment on
the pleadings under North Carolina Rule of Civil Procedure 12(c) and recites only
those allegations in the pleadings that are relevant and necessary to the Court’s
determination of the Motion.” Golden Triangle #3, LLC v. RMP-Mallard Pointe, LLC,
2020 NCBC LEXIS 37, at *1 (N.C. Super. Ct. Mar. 23, 2020).
3. 	Plaintiffs Randall Johnson, Kenneth Craig Wilson, Mark Alan Devore,
Luis 	Marcelo 	Zanetti, 	William 	James 	Ford, 	and 	Richard 	Ford 	(collectively,

“Plaintiffs”) are all investors in FJ Stairways. 	(Compl. ¶ 15.) Most of the Plaintiffs
“work in either the stair or construction industry[.]” (Compl. ¶ 15.)
4. 	FJ Stairways is now a defunct entity. However, at all times relevant to
Plaintiffs’ claims, FJ Stairways was a limited liability company organized under the
laws of North Carolina with its principal place of business in New Hanover County,
North Carolina. (Compl. ¶ 10.)
5. 	Defendant Francis Everett (“F. Everett”) is FJ Stairways’ registered
agent. (Compl. ¶ 10.) F. Everett and Cathie Everett (“C. Everett”), also a defendant,
are married and maintain their primary residence in Pender County, North Carolina.
(Compl. ¶¶ 7–8.)
6. 	FJ Stairways was “in the business of manufacturing a now patented
stair system” that the parties refer to as a “wedge system.” (Compl. ¶¶ 16–17.) The
manufacturing of FJ Stairways’ wedge system began in January of 2017. (Compl. ¶
18.)
7. 	Plaintiffs 	allege 	that 	“[F.] 	Everett 	solicited 	investments 	into 	FJ
Stairways from all of the Plaintiffs . . . by explaining to them that he was developing
a patent-pending pre-fabricated stair box system that would revolutionize the home
building 	industry” 	known 	as 	“Convert-A-Stair.” 	(Compl. 	¶¶ 	15–17, 	27.) 	He
represented to Plaintiffs that in exchange for their investments they would be given
membership interests in FJ Stairways. (Compl. ¶ 28.) Furthermore, “[p]rior to each
Plaintiff investing, [F.] Everett represented to each Plaintiff that their investment
into FJ Stairways would be utilized to fund FJ Stairways’ efforts to procure a patent

for the stair box system which would be manufactured by the limited liability
company in which they would be members.” (Compl. ¶ 60.)
8. 	Plaintiffs collectively invested $307,500 in FJ Stairways in exchange for
membership interests therein.1 (Compl. ¶ 25.)
9. 	Plaintiffs allege that F. Everett did not personally invest any money in
FJ 	Stairways 	and 	instead 	used 	Plaintiffs’ 	investments 	to 	fund 	FJ 	Stairways’
operations, as well as the patent application process for the wedge system. (Compl.
¶ 26.)
10. 	On 3 March 2018, F. Everett drafted an operating agreement on behalf
of FJ Stairways. (See Compl. Ex. A, ECF No. 3.) 	The operating agreement listed F.
Everett, Johnson, Wilson, Luis Zavetto, and Matthew J. Larsen as the members of
the company. (See Compl. Ex. A.)
11. 	On 16 October 2018—without Plaintiffs’ knowledge—F. Everett formed
CAS, a limited liability company2 with its principal place of business located in
Pender County, North Carolina. 	(Compl. ¶¶ 9, 39–40.) 	As with FJ Stairways, F.
Everett was listed as the registered agent for CAS. (Compl. ¶ 9.)
1 More specifically, on 23 October 2017, Johnson invested $30,000 in FJ Stairways. (Compl.
¶ 19.) Johnson’s investment was followed by Zanetti’s investment of $75,000 on 1 November
2017. 	(Compl. ¶ 22.) 	Subsequently, on 22 March 2018, Wilson invested $75,000. 	Next,
Devore invested $37,500 in the company on 12 July 2018. (Compl. ¶ 21.) Finally, William
James Ford invested $70,000, and Richard Ford invested $20,000, although the Complaint
does not state when the Fords’ investments were made. (Compl. ¶¶ 19–24.)
2 Defendants appear to be taking the position that CAS was merely a holding company as
opposed to a competitor of FJ Stairways. However, for purposes of the present Motion, the
Court is, of course, required to take the contrary allegations in Plaintiffs’ Complaint as true.

12. 	Plaintiffs allege that F. Everett used funds from FJ Stairways’ bank
account—funds “which were contributed in whole [or] in part by Plaintiffs”—to pay
the filing fee for CAS with the North Carolina Secretary of State’s Office. (Compl. ¶
43.)
13. 	With respect to the ownership interests in CAS, Plaintiffs allege that
the Everetts collectively own thirty percent, Estes owns forty percent, and the
remaining interests are owned by third parties who are not parties to this lawsuit.
(Compl. ¶ 50.)
14. 	On 8 January 2019, F. Everett assigned the pending patent for the
wedge system to CAS. 	(Compl. ¶ 53.) 	Subsequently on 16 April 2019, the patent
application was approved, and the patent was issued. (Compl. ¶¶ 54, 57.)
15. 	Plaintiffs assert that CAS “now operates in the same location formerly
occupied by FJ Stairways.” 	(Compl. ¶ 44.) 	Plaintiffs also allege that at least one
former FJ Stairways employee is now employed by CAS. 	(Compl. ¶ 45.) 	Moreover,
Plaintiffs contend that this employee performs the same work at CAS that he
performed at FJ Stairways—that is, building stair boxes pursuant to the patent.
(Compl. ¶¶ 46–47.) Additionally, Plaintiffs allege that CAS “to this day, utilizes some
or all of the equipment owned by FJ Stairways to manufacture stairs.” (Compl. ¶ 48.)
16. 	In July of 2019, F. Everett brought in Estes to assist in the management
of one or both of the companies, although the precise scope of his involvement is not
entirely clear from the Complaint. (See Compl. Ex. B, ECF No. 3.)

17. 	On 19 September 2019, Estes sent some or all of Plaintiffs an email,
stating as follows:
FJ Management [T]eam,
So Frank brought me in to help save FJ back in July. I evaluated
the business model and the books trying to understand the
business mission. 	It turns out FJ was trying to “do it all” with
minimal funds and limited business guidance. 	As I told Frank,
Kenny, and Randy during our September 7th meeting, FJ’s
condition was the product of poor business decisions. 	FJ was
financially broke and Frank’s patent effort was on life-support
in desperate need of cash and a major overhaul of the business
structure.
In July Frank assured me he could fund the business for 12
weeks if we could find a way to ensure future success. In 8 short
weeks we completely restructured the business model, creating
a 	corporate 	holding 	company 	(Convert-A-Stair), 	created 	an
exclusive 	scalable 	distribution 	network, 	and 	a 	regionalized
manufacturing sector that can supply over 500 stair boxes and
associated covers currently. 	We developed this to scale as
needed 	without 	impacting 	financially 	or 	injecting 	any
manufacturing constraints. 	In 	a word, the Convert-A-Stair
business model is “ready”. 	Beginning October 1, it will be a
reality.
You invested in an idea. When I was introduced to your “idea”,
you and mostly Frank, were days from failure. 	On September
7th, I introduced 3 options to your team for survival.
1) 	Be a full scale manufacturer and distributor. 	This is the
original direction FJ tried and burned through cash. This is not
a viable option which was proven.
2) 	FJ to transition as an exclusive distributor of the Convert-
A-Stair 	system 	in 	Wilmington, 	Raleigh, 	and 	any 	other
serviceable market. This seems to be the best option especially
since most of the team has a day job. We provided basic revenue
and profit numbers during the meeting.

3) 	Walk away and Frank will pay back all investments at
$0.50 on the dollar ONLY after 6 months of positive revenue and
growth.
Since the Sept 7th meeting, Frank found an investor who will
become a working partner to ensure the success of FJ. This will
obviously inject much needed cash into FJ, paying down debt,
and creating some operating income to help FJ start.
I am writing the letter to ask if current FJ members want to
continue. I asked the same question in the meeting on Sept 7th.
Frank asked me to extend to you special treatment as he wants
to see everyone be successful. As the consultant rebuilding this
business, I am moving this business forward with a distributor
in Wilmington ASAP. If it’s your team, we will all be excited. If
not, there will be another distributor set-up by Oct 1. 	I don’t
mean to press but please make a decision by next Wednesday
September 25th. 	Understand I get paid on the success of this
business as do you.
Please reach out with any questions you have. I want you guys
to be comfortable with the decision you make. 	I have attached
the following for your review:
1) Business Model visual
2) Distribution revenue and cash flow matrix
Thanks,
Brian Estes
(Compl. Ex. B (emphasis added).)
18. 	On 25 April 2023, Plaintiffs initiated this action by filing a Complaint
in Wake County Superior Court naming as defendants F. Everett, C. Everett, CAS,
FJ Stairways3, and Estes. (Compl., ECF No. 3.) 	The Complaint asserts claims for
breach of contract against F. Everett; quantum meruit against all Defendants; breach
3 On 25 October 2023, the Court issued an Order Entering Default against FJ Stairways
pursuant to Rule 55(a) of the North Carolina Rules of Civil Procedure based on its failure to
file an answer or otherwise respond to the Complaint. (Order Mot. Entry Default, ECF No.
43.)

of fiduciary duty against F. Everett; constructive fraud against F. Everett, C. Everett,
Estes, and CAS; civil conspiracy against all Defendants; fraud against F. Everett, C.
Everett, and Estes; declaratory judgment against F. Everett, FJ Stairways, and CAS;
and judicial dissolution pursuant to N.C.G.S. § 57D-6-02. (Compl. ¶¶ 72–127.)
19. 	This case was designated a mandatory complex business case on 27
April 2023 and assigned to the undersigned the same day. (ECF Nos. 1, 2.)
20. 	On 22 September 2023, Estes filed the present Motion seeking judgment
on the pleadings as to all claims against him pursuant to Rule 12(c) of the North
Carolina Rules of Civil Procedure. (Mot., ECF No. 35.)
21. 	On 28 November 2023, the Court held a hearing on Estes’ Motion, which
is now ripe for resolution.
LEGAL STANDARD
22. 	“The Court reviews a Rule 12(c) motion as it does a motion to dismiss
pursuant to Rule 12(b)(6).” 	Spivey v. Smith, 2023 NCBC LEXIS 111, at **7 (N.C.
Super. Ct. Sept. 18, 2023) (citing Akzo Nobel Coatings, Inc. v. Rogers, 2011 NCBC
LEXIS 42, at **19 (N.C. Super. Ct. Nov. 3, 2011)).
23. 	“A [Rule 12(c)] motion for judgment on the pleadings is the proper
procedure when all the material allegations of fact are admitted in the pleadings and
only questions of law remain. 	When the pleadings do not resolve all the factual
issues, judgment on the pleadings is generally inappropriate.” Ragsdale v. Kennedy,
286 N.C. 130, 137 (1974). “A complaint is fatally deficient in substance, and subject
to a motion by the defendant for judgment on the pleadings if it fails to state a good

cause of action for plaintiff and against defendant.” Bigelow v. Town of Chapel Hill,
227 N.C. App. 1, 3 (2013) (cleaned up).
24. 	When deciding a motion under Rule 12(c), the Court may only consider
“the pleadings and exhibits which are attached and incorporated into the pleadings.”
Davis v. Durham Mental Health/Dev. Disabilities/Substance Abuse Area Auth., 165
N.C. App. 100, 104 (2004) (cleaned up). 	The Court must “view the facts and
permissible inferences in the light most favorable to the nonmoving party.” Ragsdale,
286 N.C. at 137. 	“All well pleaded factual allegations in the nonmoving party’s
pleadings are taken as true and all contravening assertions in the movant’s pleadings
are taken as false. All allegations in the non-movant’s pleadings, except conclusions
of law, legally impossible facts, and matters not admissible in evidence at the trial,
are deemed admitted by the movant[.]” Id. (internal citations omitted).
ANALYSIS
25. 	At the outset the Court notes that apart from Estes, no other Defendants
have moved under Rule 12 for dismissal of the claims asserted against them by
Plaintiffs. Accordingly, the Court’s analysis herein applies only to the claims asserted
against Estes.
26. 	As noted above, Plaintiffs have alleged claims for quantum meruit,
constructive fraud, conspiracy, and fraud against Estes. (Compl. ¶¶ 76–82, 87–117.)
The Court addresses each of these claims below.

I. 	Fraud
27. 	“The 	essential 	elements 	of 	fraud 	are: 	(1) 	False 	representation 	or
concealment of a material fact, (2) reasonably calculated to deceive, (3) made with
intent to deceive, (4) which does in fact deceive, (5) resulting in damage to the injured
party.” Rowan Cnty. Bd. of Educ. v. U.S. Gypsum Co., 332 N.C. 1, 17 (1992) (cleaned
up).
28. 	Estes contends that Plaintiffs’ claim for fraud is fatally defective because
they failed to plead all the required elements of fraud and, in addition, their
allegations fail to meet the particularity requirement imposed by Rule 9(b). 	(Def.’s
Br. Supp. Mot., at 13, ECF No. 36.)
29. 	At the 28 November hearing, counsel for Plaintiffs conceded that the
allegations of the Complaint are insufficient to state a valid claim for fraud as to
Estes, and the Court agrees.
30. 	Therefore, Plaintiffs’ fraud claim against Estes is DISMISSED with
prejudice.
II. 	Quantum Meruit
31. 	Under North Carolina law, “[t]o recover in quantum meruit, [a] plaintiff
must show (1) services were rendered to defendants; (2) the services were knowingly
and voluntarily accepted; and (3) the services were not given gratuitously.” Scott v.
United Carolina Bank, 130 N.C. App. 426, 429 (1998) (cleaned up). “Quantum meruit
claims require a showing that both parties understood that services were rendered
with the expectation of payment.” Id.

32. 	Estes argues that the quantum meruit claim against him fails because
“Plaintiffs have not alleged, and cannot prove, that the services rendered were to Mr.
Estes, that he knowingly or voluntarily accepted them, or that, at the time services
were rendered, Plaintiffs expected Mr. Estes to pay.” 	(Def.’s Br. Supp. Mot., at 6.)
Estes further contends that (1) “Plaintiffs have failed to clearly identify what
service[s] form[ ] the basis of their . . . claim[;]” and (2) assuming the alleged services
concerned Plaintiffs’ investments in FJ Stairways, “Plaintiffs fail to allege, and
cannot prove, that they invested this money to the benefit of Mr. Estes or that they
rendered any other service to Mr. Estes.” (Def.’s Br. Supp. Mot., at 6.)
33. 	The Court concludes that Plaintiffs’ quantum meruit claim fails for
several reasons—most basically, because their allegations do not meet the first
element of the claim. There is no allegation that Plaintiffs actually rendered any
services to Estes.
34. 	Plaintiffs’ response brief seeks to restate this claim as one for unjust
enrichment but even so construed, the claim still fails as a matter of law.
35. 	To plead a claim for unjust enrichment, a plaintiff must allege the
following elements:
First, one party must confer a benefit upon the other party. . . . Second,
the benefit must not have been conferred officiously, that is it must not
be conferred by an interference in the affairs of the other party in a
manner that is not justified in the circumstances. . . . Third, the benefit
must not be gratuitous. . . . Fourth, the benefit must be measurable. . . .
Last, the defendant must have consciously accepted the benefit.
JP Morgan Chase Bank, N.A. v. Browning, 230 N.C. App. 537, 541–42 (2013) (cleaned
up).

36. 	Plaintiffs contend that the allegation in paragraph 77 of their Complaint
sufficiently avers that Plaintiffs provided a benefit directly to Estes. 	(Pls.’ Br. Opp.
Mot., at 16, ECF No. 38.) 	Paragraph 77 states as follows: “At the request of [F.]
Everett, Plaintiffs provided a total of $307,500.00 to [F.] Everett, FJ Stairways, and
upon information and belief, ultimately Convert-A-Stair, [C.] Everett, and Mr. Estes.”
(Compl. ¶ 77.) Estes contends that this allegation is impermissibly conclusory.
37. 	For purposes of analyzing the sufficiency of a claim under Rule 12(c),
“the 	Court 	need 	not 	accept 	as 	true 	allegations 	that 	are 	‘merely 	conclusory,
unwarranted deductions of fact, or unreasonable inferences.’ ” 	Spivey, 2023 NCBC
LEXIS 111, at **8 (quoting Good Hope Hosp., Inc. v. N.C. Dep’t of Health and Hum.
Servs., 174 N.C. App. 266, 274 (2005)).
38. 	The 	Court 	finds 	that 	the 	reference 	to 	Estes 	in 	paragraph 	77 	is
insufficient to save this claim. Other portions of the Complaint make clear that the
money Plaintiffs invested in FJ Stairways was solicited solely by F. Everett, and a
thorough reading of the Complaint reveals that this money was paid by Plaintiffs well
before Estes was brought on board by F. Everett.
39. 	Indeed, 	in 	paragraph 	52 	of 	the 	Complaint 	Plaintiffs 	expressly
acknowledge that after F. Everett’s original efforts to persuade Plaintiffs to invest in
FJ Stairways—which, once again, did not involve Estes—neither the Everetts nor
Estes ever asked Plaintiffs for additional funds for FJ Stairways. As such, Plaintiffs’
allegations are insufficient to state a valid claim for either quantum meruit or unjust
enrichment.

40. 	For these reasons, Plaintiffs’ claim for quantum meruit against Estes is
DISMISSED with prejudice.
III. 	Constructive Fraud
41. 	Our Supreme Court has summarized the elements of a constructive
fraud claim as follows:
Constructive fraud arises where a confidential or fiduciary relationship
exists, and its proof is less exacting than that required for actual
fraud. When a fiduciary relation exists between parties to a transaction,
equity raises a presumption of fraud when the superior party obtains a
possible benefit. To assert a cause of action for constructive fraud, the
plaintiff must allege facts and circumstances (1) which created the
relation of trust and confidence, and (2) led up to and surrounded the
consummation of the transaction in which defendant is alleged to have
taken advantage of his position of trust to the hurt of plaintiff.
Head v. Gould Killian CPA Grp., P.A., 371 N.C. 2, 9 (2018) (cleaned up).
42. 	Estes contends that the claim for constructive fraud against him fails
because there is no allegation that Plaintiffs had a confidential relationship or a
relationship of trust or confidence with him. 	(Def.’s Br. Supp. Mot., at 9–11.) 	In
response, Plaintiffs argue that they have sufficiently alleged the existence of a de
facto fiduciary relationship with Estes. (Pls.’ Br. Opp. Mot., at 10–12.)
43. 	The 	Court 	concludes 	that 	the 	Complaint 	is 	devoid 	of 	allegations
sufficient to plead the existence of a fiduciary relationship between Plaintiffs and
Estes.
44. 	“In North Carolina, a fiduciary duty can arise by operation of law (de
jure) or based on the facts and circumstances (de facto)[.]” Lockerman v. S. River Elec.
Mbrshp. Corp., 250 N.C. App. 631, 635 (2016). 	De jure fiduciary relationships are
often characterized by the existence of “a heightened level of trust and the duty of the

fiduciary to act in the best interests of the other party.” Dallaire v. Bank of Am., N.A.,
367 N.C. 363, 367 (2014). 	With respect to de facto fiduciary relationships, “[t]he
standard for finding a de facto fiduciary relationship is a demanding one: Only when
one party figuratively holds all the cards—all the financial power or technical
information, 	for 	example—have 	North 	Carolina 	courts 	found 	that 	the 	special
circumstance of a fiduciary relationship has arisen.” 	Lockerman, 250 N.C. App. at
636 (cleaned up).
45. 	As an initial matter, Plaintiffs do not contend that a de jure fiduciary
relationship 	existed 	between 	them 	and 	Estes. 	Furthermore, 	the 	allegations
contained in the Complaint cannot reasonably be construed as asserting the existence
of a de facto fiduciary relationship. There is simply no allegation of trust or confidence
reposed by Plaintiffs upon Estes or that Estes took advantage of such a relationship.
Indeed, the only actual contact alleged in the Complaint between Estes and Plaintiffs
is their receipt of the 19 September 2019 email sent by Estes and a 7 September
meeting referenced in that email that apparently occurred between Estes and several
of Plaintiffs in which the financial status of FJ Stairways was discussed.
46. 	Accordingly, Plaintiffs’ claim for constructive fraud against Estes is
DISMISSED with prejudice.
IV. 	Conspiracy
47. 	The Court reaches a different conclusion, however, with respect to
Plaintiffs’ conspiracy claims against Estes.

48. 	It is well-established law that “there is not a separate civil action for
civil conspiracy in North Carolina.” 	Dove v. Harvey, 168 N.C. App. 687, 690 (2005).
Rather, “civil conspiracy is premised on the underlying act.” Harris v. Matthews, 361
N.C. 265, 274, n.2 (2007). Accordingly, to plead a claim for civil conspiracy, a plaintiff
must allege: “(1) an agreement between two or more persons; (2) to do an unlawful
act or to do a lawful act in an unlawful way; (3) which agreement resulted in injury
to the plaintiff.” Boyd v. Drum, 129 N.C. App. 586, 592 (1998).
49. 	A conspiracy claim cannot be maintained “for acts that occurred before
[a party] joined the alleged conspiracy if those acts completed the ultimate objective of
the conspiracy. 	In contrast, if the objective of the conspiracy was not yet achieved
when [the party] joined, then [the party] remains jointly and severally liable for those
acts.” 	Hart v. First Oak Wealth Mgmt., LLC, 2022 NCBC LEXIS 81, at **66 (N.C.
Super. Ct. July 28, 2022) (emphasis in original).
50. 	This Court has noted that “it is difficult to dismiss a conspiracy claim
summarily because the elements of a conspiracy claim are broadly stated.” 	Safety
Test & Equip. Co. v. Am. Safety Util. Corp., 2015 NCBC LEXIS 40, at *48 (N.C. Super.
Ct. Apr. 23, 2015); see also Kixsports, LLC v. Munn, 2021 NCBC LEXIS 32, at *37
(N.C. Super. Ct. Apr 1, 2021) (“An action for conspiracy may be proven through
circumstantial evidence, and behavior that may be benign or innocuous when
standing alone can acquire a different meaning when placed in a larger context.”
(citation and quotation marks omitted)); Glob. Textile All., Inc. v. TDI Worldwide,

LLC, 2018 NCBC LEXIS 104, at **19–20 (N.C. Super. Ct. Oct. 9, 2018) (finding
allegations minimally sufficient to support a civil conspiracy claim).
51. 	Among other allegations in their Complaint in support of this claim,
Plaintiffs assert that “Defendants conspired to deceive and defraud Plaintiffs, in
violation of [F.] Everett’s fiduciary duties, into conferring a substantial benefit on
Defendants.” 	(Compl. ¶ 97.) 	According to the Complaint, this conspiracy involved
the Everetts “form[ing] an agreement to solicit investments from Plaintiffs and then
form[ing CAS] as a way to exclude Plaintiffs from any benefit of the operation of FJ
Stairways, or the Patent” in violation of F. Everett’s fiduciary duties to Plaintiffs.
(Compl. ¶ 98.)
52. 	With respect to Estes, Plaintiffs allege that he joined the Everetts’
conspiracy “shortly after [CAS] was formed and agreed to participate in and continue
the unlawful conduct of [the] Everett[s].” (Compl. ¶ 99.) Plaintiffs contend that Estes
acted in furtherance of the alleged conspiracy when he sent the 19 September 2019
email to Plaintiffs. (Compl. ¶ 101.)
53. 	Estes, conversely, maintains that even assuming arguendo that the
Everetts engaged in a conspiracy to deceive and defraud Plaintiffs, “its purpose would
have been accomplished as soon as money from FJ [Stairways] was used to form and
fund CAS.” (Def.’s Br. Supp. Mot., at 12.) Thus, Estes argues, he cannot be liable for
any such conspiracy because its objective would have been fulfilled before he assumed
any role with regard to the companies at issue.

54. 	Admittedly, the conspiracy allegations against Estes are not a model of
specificity. 	Nevertheless, 	the 	Court 	believes 	they 	are 	sufficient 	to 	allow 	the
conspiracy claim against Estes to go forward.
55. 	It is true, as Estes contends, that the Complaint alleges a conspiracy for
the purpose of inducing Plaintiffs to invest money in FJ Stairways and that this
objective was accomplished before Estes came on the scene. However, the Complaint
also alleges that Estes participated in a conspiracy with F. Everett to breach F.
Everett’s fiduciary duty to Plaintiffs by forming CAS for the purpose of competing
against FJ Stairways and using FJ Stairways’ assets (including Plaintiffs’ invested
funds) to do so. For example, Plaintiffs allege the following:
Upon information and belief, when FJ Stairways was “out of funds” [F.]
Everett, [C.] Everett, and Mr. Estes formed an agreement to sell off
“equity” in the new entity, Convert-A-Stair, L.L.C., an entity engaged in
the the [sic] exact same business as FJ Stairways, to the exclusion of
Plaintiffs, and in violation of [F.] Everett’s fiduciary duties to the
Plaintiffs.
. . .
Upon information and belief, [F.] Everett, [C.] Everett, and Mr. Estes
sold interests in Convert-A-Stair, L.L.C. to various third parties, even
though Convert-A-Stair, L.L.C. uses the equipment of FJ Stairways, the
location of FJ Stairways, works with certain customers of FJ Stairways,
and 	manufactures 	the 	exact 	same 	patented 	product 	previously
manufactured by FJ Stairways.
. . .
Upon information and belief, Mr. Estes conspired with, and formed an
agreement with, [F.] Everett and/or [C.] Everett to send Plaintiffs
Exhibit “B” in violation of [F.] Everett’s fiduciary duties to Plaintiffs.
. . .

[F.] Everett breached his fiduciary duties to the Plaintiffs proximately
causing damage to the Plaintiffs by:
a. 	Misappropriation of funds;
b. 	Conspiring with [C.] Everett and [F.] Everett to create a
new limited liability company, Convert-A-Stair, L.L.C. to
compete with Plaintiffs to the exclusion of Plaintiffs; and
c. 	Other ways to be proven at trial.
(Compl. ¶¶ 49, 51, 62, 85.)
56. 	Moreover, in Estes’ 19 September 2019 email, he acknowledges that he
participated in the creation of CAS and played at least some role in addressing the
companies’ financial issues and business plans. (See Compl. Ex. B.)
57. 	It is clear that much remains to be fleshed out during discovery about
the scheme alleged by Plaintiffs, Estes’ role in these events, the extent to which CAS
improperly competed with FJ Stairways, and how the formation and operation of CAS
contributed to Plaintiffs’ alleged injuries. Nevertheless, taking the allegations in the
light most favorable to Plaintiffs, Plaintiffs have alleged an agreement between Estes
and F. Everett (and possibly others) to engage in wrongful conduct, that Estes
committed overt acts in furtherance of the agreement, and that Plaintiffs were
injured as a result. These allegations are enough to survive Estes’ Rule 12(c) motion.
58. 	Therefore, Estes’ Motion is DENIED as to Plaintiffs’ civil conspiracy
claim. See New Friendship Used Clothing Collection, LLC v. Katz, 2017 NCBC LEXIS
72, at *49 (N.C. Super. Ct. Aug. 18, 2017) (“The Court concludes that, at the pleading
stage, these allegations are sufficient to state an agreement between Defendants
facilitating Katz’s breach of fiduciary duty.”); Veer Right Mgmt. Group, Inc. v.

Czarnowski Display Serv., 2015 NCBC LEXIS 13, at **11 (N.C. Super. Ct. Feb. 4,
2015) (“Again recognizing that the issue at this stage is solely whether Plaintiff has
adequately alleged a claim, not whether it ultimately will be able to prove that claim,
the Court concludes that Plaintiff has adequately alleged an agreement, with
subsequent harm caused by implementing the agreement, and that the conspiracy
claim withstands Rule 12(b)(6).”); GoRhinoGo, LLC v. Lewis, 2011 NCBC LEXIS 39,
at **18–22 (N.C. Super. Ct. Sept. 29, 2011) (recognizing that a scheme to violate a
party’s fiduciary duty could give rise to a claim for civil conspiracy); see also Hart,
2022 NCBC LEXIS 81, at **65 (holding that a more developed factual record was
necessary to evaluate the validity of the plaintiff’s conspiracy claim).
CONCLUSION
THEREFORE, IT IS ORDERED as follows:
1. 	Defendant Estes’ Motion is GRANTED with respect to Plaintiffs’ claims for
fraud, quantum meruit, and constructive fraud, and those claims are
hereby DISMISSED with prejudice as against Defendant Estes.
2. 	Defendant Estes’ Motion is DENIED as to Plaintiffs’ claim for civil
conspiracy.
SO ORDERED, this the 5th day of January, 2024.
/s/ Mark A. Davis
Mark A. Davis
Special Superior Court Judge for
Complex Business Cases