Kathleen W. Meardon, Individually v. Terry Gene Register

United States Court of Appeals
For the Eighth Circuit
___________________________
No. 19-3258
___________________________
Kathleen W. Meardon, Individually, and as Successor in Interest to the Estate of
William A. Meardon; Lifetime Financial Group, LLC, an Iowa Limited Liability
Corporation; Financial Dynamics Group, Inc., an Iowa Corporation; Meardon
Financial Services, Inc., an Iowa Corporation
lllllllllllllllllllllPlaintiffs - Appellants
v.
Terry Gene Register; Capital Marketing Group, Inc., a North Carolina
Corporation; Capital Insurance Planning, Inc., a North Carolina Corporation
lllllllllllllllllllllDefendants - Appellees
____________
Appeal from United States District Court
for the Southern District of Iowa - Davenport
____________
Submitted: December 15, 2020
Filed: April 19, 2021
____________
Before SMITH, Chief Judge, LOKEN and MELLOY, Circuit Judges.
____________
MELLOY, Circuit Judge.
Plaintiffs appeal the district court’s dismissal of their tort and contract claims
under Federal Rule of Civil Procedure 12(b)(6) for failure to state claims upon which

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relief can be granted. Because Plaintiffs sufficiently stated claims for breach of
contract, unjust enrichment, fraud, and breach of fiduciary duty under Iowa law, we
reverse and remand for further proceedings as to those claims. We affirm in all other
respects.
I. Background
The following facts, as alleged in the Second Amended Complaint, are
accepted as true. This suit arises from statements and actions that followed the
sudden death of William Andrew Meardon, husband of Plaintiff Kathleen Meardon,
on December 15, 2016. When he was alive, William owned and operated Lifetime
Financial Group, LLC, an Iowa limited liability company, and Financial Dynamics
Group, Inc., an Iowa corporation. He was licensed to sell insurance products through
these entities.
As part of his business, William often worked with Defendant Terry Gene
Register, a North Carolina resident. Register owns and operates Capital Marketing
Group, Inc., a North Carolina corporation, and Capital Insurance Planning, Inc., a
North Carolina corporation, which are both under his exclusive control. When
working together, William would often sell insurance products with Register and
Register’s companies. In this relationship, Register typically acted as the “managing
general agent” for sales while William was the “insurance producer” and “agent of
record.” When sales were made, both William and Register would receive a
commission—William would receive a “producer commission” as the agent of record
and Register would receive an “override commission” as managing general agent.
Under Iowa law, an “insurance producer” means a person required to be licensed “to
sell, solicit, or negotiate insurance.” Iowa Code section 522B.1(6). To sell insurance
products as an agent of an insurer, an individual insurance agent must be appointed
by the insurer. William had the “producer appointments” necessary to be an agent.
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After William’s unexpected death, Kathleen was suffering from depression and
shock. When the family held a wake for William, Register attended. While at the
wake, he approached and spoke with Kathleen, telling her he would act as her
personal business advisor and help her to transition William’s insurance interests over
to her control and establish her own business. Following the wake, Register
repeatedly told Kathleen that he was an expert in business practices of the insurance
industry, that “she could rely upon him to treat her interests above those of his own,”
and that he “would act honestly and in her best interest in his counsel and advice.”
Register “offered his assistance to complete the issuance of several large life
insurance policies [William] had begun for close personal friends and business
partners collectively” known for purposes of this litigation as “RK.”1
Register “repeatedly assured” Kathleen that he, through his companies, would
continue to honor the terms of the producer appointments with William. He also
made assurances about making producer appointments with Kathleen’s son, Levi, so
that Kathleen’s business could receive future commissions. Because of these
assurances, she disclosed her future business plans to Register, including her intent
to obtain the life insurance policies for RK, continue operating her various
companies, and form a new entity, Meardon Financial Services.2 Upon learning this
1Before William’s death, William and Register were in the process of finalizing
several life insurance applications for RK. It appears that, due to a missing medical
check, an insurance application to Columbus Life Insurance was denied in November
2016. The application had listed William as the producer and Register as the
managing general agent.
2In order to try to wrap up her husband’s business, Kathleen initially obtained
a Surviving Spouse License from the State of Iowa, under Iowa Code section
522B.10. The license, issued March 3, 2017, allowed her to act as the “insurance
producer” for the business and to legally receive commissions for sales. By August
1, 2017, Kathleen formed a new corporation, Meardon Financial Services, Inc., and
hired additional licensed insurance agents. Her son, Levi Meardon, was also a
member of her team.
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information, Register secured the domain name “meardonfinancialservices.com”
without informing Kathleen, built a website, and directed all email inquiries from the
website to his own company’s website. Register has never relinquished control of the
domain name or passed along the email inquiries to Kathleen.
At a later date, Register approached RK independently of Plaintiffs and told
RK he was working to complete the life insurance sale on behalf of Plaintiffs. He
was not. Instead, Register sold RK $20,000,000 in life insurance products through
Principal National Life Insurance Company with Register listed as both the insurance
producer and managing general agent. Register then avoided Plaintiffs and did not
disclose that he obtained life insurance coverage for RK. Eventually, Kathleen and
RK met and discovered that RK had already bought insurance from Defendants,
without the intended commission going to Kathleen. On June 12, 2018, RK changed
his insurance endorsement to Plaintiffs.
Also at a later date, Register discussed with Kathleen the possibility of her
purchasing $6,000,000 in annuities. Register represented to Kathleen that (1) the
annuities would fund immediately with a monthly payout of $25,000, and (2)
Kathleen or another employee of Plaintiffs would be listed as a producer on the
contracts and thereby receive a commission on the sale. Instead, Register provided,
and Kathleen signed, applications for long-term, deferred annuities that would not
begin to pay an income immediately. Contrary to Kathleen’s understanding of the
application, she was not listed as the insurance producer on the sale, nor was anyone
from her company. Therefore, neither she nor her company received a commission
from the sale. Register sent Kathleen three checks referencing her annuity purchases,
totaling $120,000, and a fourth check with no reference for an additional $10,000.
Kathleen deposited all but the last check.3
3The purpose of these checks is not made entirely clear by the evolving
pleadings. However, it appears that Register recognized Kathleen was upset that her
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Based on these allegations, Plaintiffs brought this diversity action in federal
court asserting six claims under Iowa law: (1) fraudulent or intentional
misrepresentation; (2) negligent misrepresentation; (3) breach of contract; (4) unjust
enrichment; (5) misappropriation of trade secrets; and (6) breach of fiduciary duty.
Multiple rounds of pleadings followed.
The district court ultimately granted Defendants’ pre-answer motion to dismiss
all six claims as asserted in Plaintiffs’ Second Amended Complaint. As to the fraud
and misrepresentation claims, the district court held Plaintiffs failed to sufficiently
plead that Kathleen’s reliance on Register’s promises was justified under the
circumstances. The district court similarly ruled Plaintiffs failed to adequately plead
various elements of the other claims, including that (1) there was adequate
consideration to establish an enforceable contract; (2) any enrichment to the
Defendants was unjust; (3) the identity of RK constituted a trade secret; and (4) a
fiduciary relationship existed between Register and Kathleen. In doing so, the district
court relied on several documents, including contracts, mentioned in the Complaint
and certain documents filed by Defendants. Noting that the result seemed unjust, the
district court felt itself bound by law to dismiss the claims for inadequate pleadings.
Plaintiffs filed a motion to amend the judgment under Rules 52(b) and 59(e), which
the district court denied. Plaintiffs now appeal as to all claims.
II. Discussion
We review de novo a grant of a motion to dismiss under Fed R. Civ. P.
12(b)(6). Adams v. Am. Family Mut. Ins. Co., 813 F.3d 1151, 1154 (8th Cir. 2016).
We accept the well-pled allegations in the complaint as true and draw all reasonable
annuities were not set to pay income immediately and that he used the checks as a
way to “tide her over.” In 2018, Register sent Kathleen a 1099 for the $120,000,
which he categorized as “nonemployee compensation.”
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inferences in the plaintiff’s favor. Schriener v. Quicken Loans, Inc., 774 F.3d 442,
444 (8th Cir. 2014). “To survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible
on its face.’” Id. (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “A claim has
facial plausibility when the plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable for the misconduct alleged.”
Iqbal, 556 U.S. at 678. We assess plausibility considering only the complaint and
materials that are “necessarily embraced by the pleadings and exhibits attached to the
complaint,” Mattes v. ABC Plastics, Inc., 323 F.3d 695, 697 n.4 (8th Cir. 2003),
“draw[ing] on [our own] judicial experience and common sense,” Iqbal, 556 U.S. at
679. Further, we “review the plausibility of the plaintiff’s claim as a whole, not the
plausibility of each individual allegation.” Zoltek Corp. v. Structural Polymer Grp.,
592 F.3d 893, 896 n.4 (8th Cir. 2010). Federal Rule of Civil Procedure 9(b) requires
a party alleging fraud to “state with particularity the circumstances constituting
fraud.” Fed. R. Civ. P. 9(b). That is, the plaintiff must plead “the who, what, when,
where, and how.” Summerhill v. Terminix, Inc., 637 F.3d 877, 880 (8th Cir. 2011).
On appeal, Plaintiffs argue their pleadings were sufficient to present plausible
claims. At first glance, the claims alleged appear implausibly Dickensian. However,
“a well-pleaded complaint may proceed even if it strikes a savvy judge that actual
proof of those facts is improbable.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544,
556 (2007). Keeping in mind that this case is only at the pleading stage, we turn to
Plaintiffs’ claims.
A. Breach of Contract (Count III)
In Count III of the Complaint, Plaintiffs allege breach of contract. In order to
show a breach of contract, Plaintiffs must prove: (1) the existence of a contract; (2)
the terms and conditions of the contract; (3) performance of those terms and
conditions; (4) breach of the contract; and (5) damages from the breach of the
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contract. See Molo Oil Co. v. River City Ford Truck Sales, Inc., 578 N.W.2d 222,
224 (Iowa 1998).
Plaintiffs’ breach of contract claim is based on two oral agreements—one
concerning the sale of life insurance products to RK and one concerning the sale of
annuities to Kathleen. As to the annuities, a written contract exists that contradicts
the facts alleged by Plaintiffs. Because its contents contradict the pleadings and
defeat Plaintiffs’ annuity-related contract claim, we agree with the district court that
the annuity-related contract claim must be dismissed. Gorog v. Best Buy Co., 760
F.3d 787, 792 (8th Cir. 2014); see also Stahl v. U.S. Dep’t of Agric., 327 F.3d 697,
700 (8th Cir. 2003) (“In a case involving a contract, the court may examine the
contract documents in deciding a motion to dismiss.”).
Plaintiffs also allege Defendants breached an oral agreement under which
Kathleen was to receive the producer commissions on the purchase of life insurance
for RK and Register was to receive the override commissions. Defendants argue no
contract was formed due to a lack of consideration. They argue that Register made
a gratuitous promise to complete the sale to RK, which cannot constitute
consideration. Defendants argue Count III was properly dismissed because the
agreements between Kathleen and Register were not alleged to be supported by
adequate consideration.
Consideration is an essential element of any binding contract. Magnusson
Agency v. Public Entity Nat’l Co.-Midwest, 560 N.W.2d 20, 26 (Iowa 1997). Under
Iowa law, “the element of consideration ensures the promise sought to be enforced
was bargained for and given in exchange for a reciprocal promise or an act.”
Margeson v. Artis, 776 N.W.2d 652, 655 (Iowa 2009).
Thus, a promise made by one party to a contract normally cannot be
enforced by the other party to the contract unless the party to whom the
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promise was made provided some promise or performance in exchange
for the promise sought to be enforced. In other words, if the promisor
did not seek anything in exchange for the promise made or if the
promisor sought something the law does not value as consideration, the
promise made by the promisor is unenforceable due to the absence of
consideration. In this way, a promise is supported by consideration in
one of two ways. First, consideration exists if the promisee, in exchange
for a promise by the promisor, does or promises to do something the
promisee has no legal obligation to do. Second, consideration exists if
the promisee refrains, or promises to refrain, from doing something the
promisee has a legal right to do.
Id. at 655–56 (citations omitted).
Plaintiffs allege Register offered his assistance to Kathleen in securing the sale
of life insurance products to RK. For completing the sale, Register was to receive the
override commission. Register was not already entitled to the commission
because—as Defendants point out—RK’s previous application through Register and
William Meardon had been denied. And, Register knew that RK was a personal
friend of the Meardons who wished to complete the sale through the Meardons.
Therefore, Register needed to make sure he still had access to the override
commission on the sale of RK’s life insurance. To do this, he contacted Kathleen,
who told him she was still interested in working together to complete a sale to RK.
RK’s relationship with Kathleen and desire to purchase the insurance through her was
a valuable asset. In agreeing to accept Register’s assistance, Kathleen refrained from
taking RK’s business—her client’s business—to another agent. These allegations are
sufficient to plead consideration in support of the contract. Margeson, 776 N.W.2d
at 655–56. Plaintiffs sufficiently state a claim for breach of contract as to the sale of
life insurance to RK.
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B. Unjust Enrichment (Count IV)
In Count IV of the Complaint, Plaintiffs allege Defendants were unjustly
enriched at Plaintiffs’ expense. To recover under a theory of unjust enrichment, the
plaintiff must establish: “(1) defendant was enriched by the receipt of a benefit; (2)
the enrichment was at the expense of the plaintiff; and (3) it is unjust to allow the
defendant to retain the benefit under the circumstances.” State ex rel. Palmer v.
Unisys Corp., 637 N.W.2d 142, 154–55 (Iowa 2001).
Defendants argue Count IV was properly dismissed because Plaintiffs do not
plead circumstances that make it unjust for Register to retain the commissions he
received for sales of annuities to Kathleen and life insurance products to RK.
Defendants argue Register worked for the right to earn the commissions and, in
contrast, Kathleen and Plaintiffs did nothing and therefore have no claim to any
portion of the commissions. Because it is undisputed that an express contract exists
between the parties as to the sale of annuities, the unjust enrichment claim directed
towards the annuity must fail as a matter of law. Kunde v. Estate of Bowman, 920
N.W.2d 803, 807–08 (Iowa 2018); Scott v. Grinnell Mut. Reinsurance Co., 653
N.W.2d 556, 561 n.2 (Iowa 2002) (rejecting generally claims of implied contracts in
the presence of express contracts). However, as to the sale of life insurance products
to RK, the parties dispute the existence of an enforceable oral contract. A party is not
barred from pleading unjust enrichment in the alternative to a breach of contract claim
when the existence and terms of a contract are in dispute. See, e.g., Legg v. West
Bank, 873 N.W.2d 763, 771–72 (Iowa 2016) (“Although we have held there may be
a contract implied in law on a point not covered by an express contract, there can be
no such implied contract on a point fully covered by an express contract and in direct
conflict therewith.” (quoting Smith v. Stowell, 125 N.W.2d 795, 800 (1964))); see
also Union Pac. R.R. Co. v. Cedar Rapids & Iowa City Ry. Co., 477 F. Supp. 2d 980,
1001–03 (N.D. Iowa 2007) (applying Iowa law).
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Plaintiffs have pleaded the basic elements and factual support for an unjust
enrichment claim, namely, that Register accepted and retained a benefit to which he
was not fully entitled. “The doctrine of unjust enrichment is based on the principle
that a party should not be permitted to be unjustly enriched at the expense of another
. . . . .” State ex rel. Palmer, 637 N.W.2d at 154. It “is a broad principle with few
limitations.” Id. at 155. Benefits need not “be conferred directly by the plaintiff[s],”
instead, “[t]he critical inquiry is that the benefit received be at the expense of the
plaintiff.” Id. And, “whether it is unjust to profit at another’s expense depends on
the circumstances.” CRST Expedited, Inc. v. TransAm Trucking, Inc., 960 F.3d 499,
509 (8th Cir. 2020) (applying Iowa law). Here, Register received the benefit of an
undivided commission on the sale of products to RK. The commission collected by
Register is alleged to be at least an indirect result of (1) Kathleen entrusting Register
to split the commission, and (2) Kathleen refraining from interfering with Register’s
access to the override commission. By not listing Kathleen as producer on the sales,
Register was able to retain a larger commission than he was otherwise going to
receive. Accordingly, we conclude the district court erred in granting Register’s
motion to dismiss on Kathleen’s unjust enrichment claim as related to the RK
insurance sale.
C. Breach of Fiduciary Duties (Count VI)
In Count VI of the complaint, Plaintiffs allege Register breached his fiduciary
duties to Kathleen. To state a claim for breach of a fiduciary duty under Iowa law,
the plaintiff must plead facts showing that “(1) [the defendant] owed a fiduciary duty
to [the plaintiff]; (2) [the defendant] breached the fiduciary duty . . . ; (3) the breach
of fiduciary duty was a proximate cause of damage to [the plaintiff]; and (4) the
amount of damages, if any.” Top of Iowa Co–op. v. Schewe, 149 F. Supp. 2d 709,
717 (N.D. Iowa 2001), aff’d, 324 F.3d 627 (8th Cir. 2003).
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Defendants argue Count VI was properly dismissed because the facts, as
alleged, do not give rise to a fiduciary relationship between Kathleen and Register.
Under Iowa law, “[a] fiduciary relationship exists between two persons ‘when one of
them is under a duty to act for or to give advice for the benefit of another upon
matters within the scope of the relation.’” Vos v. Farm Bureau Life Ins. Co., 667
N.W.2d 36, 52 (Iowa 2003) (quoting Kurth v. Van Horn, 380 N.W.2d 693, 695 (Iowa
1986)). Certain two-party relationships, such as those between attorney and client,
“necessarily give rise to a fiduciary relationship.” Kurth, 380 N.W.2d at 696.
Generally, the relationship of business associates or between a business owner and
a consultant does not automatically give rise to a fiduciary duty.
Even so, Iowa law recognizes that fiduciary, or confidential relationships, can
“exist[] when one person has gained the confidence of another and purports to act or
advise with the other’s interest in mind.” Wilson v. IBP, Inc., 558 N.W.2d 132, 138
(Iowa 1996) (quoting Hoffman v. National Med. Enters., Inc., 442 N.W.2d 123, 125
(Iowa 1989)). “The gist of the doctrine of confidential relationship is the presence
of a dominant influence under which the act is presumed to have been done. [The]
[p]urpose of the doctrine is to defeat and protect betrayals of trust and abuses of
confidence.” Id. (quoting Hoffman, 442 N.W.2d at 125). Fiduciary relationships may
arise in a variety of scenarios, including those involving: “the acting of one person
for another; the having and the exercising of influence over one person by another;
the reposing of confidence by one person in another; the dominance of one person by
another; the inequality of the parties; and the dependence of one person upon
another.” Kurth, 380 N.W.2d at 696 (citation omitted). No one factor is
determinative. Rather, Iowa courts have repeatedly recognized that, “[b]ecause the
circumstances giving rise to a fiduciary duty are so diverse, any such relationship
must be evaluated on the facts and circumstances of each individual case.” Id.; see
also Vos, 667 N.W.2d at 52.
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Here, Plaintiffs allege Register contacted Kathleen repeatedly, beginning at her
husband’s wake, to offer his expertise and counsel as she attempted to restructure her
husband’s business into her own. Register communicated his interest in helping
Kathleen complete certain sales, specifically the sale of life insurance products to RK.
The complaint alleges Register took on the role of advising Kathleen not only as to
her personal financial decisions but also her business decisions. Register assured
Kathleen that he would continue to honor the terms of certain producer appointments,
seemingly to his own detriment, so that she could receive future commissions to fund
her business. Kathleen alleges that, based on these assurances, she trusted Register
enough to disclose her business plans to him, including her planned operation of
several new entities and her efforts to complete the sale of policies to RK.
Based on these allegations, Kathleen placed her confidence in Register. But
a plaintiff alone, by placing trust in a defendant, does not imbue a business
relationship with fiduciary duty. See Union Cty. v. Piper Jaffray & Co., 741 F. Supp.
2d 1064, 1104–05 (S.D. Iowa 2010) (collecting cases). At a minimum, the defendant
must be aware of the trust placed in him. See id.; cf. Irons v. Comm. State Bank, 461
N.W.2d 849, 852 (Iowa Ct. App. 1990) (“The Irons apparently feel because they
reposed some trust in the bank, a fiduciary relationship was created. However, not
only does the record fail to show a fiduciary relationship based on the facts, but also
there is no evidence the bank ever assented to or was aware of a fiduciary
relationship.”). “[S]uch ‘assent’ or ‘knowledge’ is ordinarily demonstrated by proof
that the reposing of confidence and trust on the one side resulted in dominance and
influence on the other side.” Id. at 1105.
The allegations depict Register as, in part, acting on his own behalf in
procuring continued business. However, they also indicate Register was purporting
to act on behalf of Kathleen in a confidential and influential relationship—one in
which Register was allegedly aware of the confidence Kathleen placed in him. Kurth,
380 N.W.2d at 698 (rejecting a breach of fiduciary duty claim against a bank where
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a plaintiff failed to show the bank was aware the plaintiff had relied on the bank for
advice). Based on this confidence, Register was allegedly able to influence
Kathleen’s business decisions in ways far beyond an arm’s length business
relationship. First Nat’l Bank in Sioux City v. Curran, 206 N.W.2d 317, 324 (Iowa
1973) (“By virtue of the reposed confidence itself, the recipient of the transfer has
influence he would not possess if the two individuals were at arm’s length.”). Such
conduct, at least in the context of a motion to dismiss, plausibly supports an alleged
fiduciary relationship. Therefore, we conclude Plaintiffs sufficiently stated a claim
for breach of fiduciary duty.
D. Fraud and Negligent Misrepresentation (Counts I and II)
To the extent Plaintiffs’ claims of fraud or negligent misrepresentation relate
to the sale of life insurance products to RK, we find the claims sufficient to survive
the motion to dismiss. In order to prevail on a common law fraud claim the plaintiff
must prove: “(1) [the] defendant made a representation to the plaintiff, (2) the
representation was false, (3) the representation was material, (4) the defendant knew
the representation was false, (5) the defendant intended to deceive the plaintiff, (6)
the plaintiff acted in [justifiable] reliance on the truth of the representation . . . , (7)
the representation was a proximate cause of [the] plaintiff’s damages, and (8) the
amount of damages.” Spreitzer v. Hawkeye State Bank, 779 N.W.2d 726, 735 (Iowa
2009) (citation omitted). Defendants argue Plaintiffs failed to sufficiently plead
justifiable reliance as to both claims. “[T]he justified standard followed in Iowa
means the reliance does not necessarily need to conform to the standard of a
reasonably prudent person, but depends on the qualities and characteristics of the
particular plaintiff and the specific surrounding circumstances.” Id. at 737. “Still, the
individual to whom the fraudulent misrepresentation is made is ‘required to use his
senses, and cannot recover if he blindly relies on a misrepresentation the falsity of
which would be patent to him if he had utilized his opportunity to make a cursory
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examination or investigation.’” Dier v. Peters, 815 N.W.2d 1, 9 (Iowa 2012) (quoting
Lockard v. Carson, 287 N.W.2d 871, 878 (Iowa 1980)).
Here, Plaintiffs allege that Register told Kathleen he was working in his
capacity as business advisor and confidante to help complete the sale of life insurance
products for Kathleen. Kathleen wanted to complete the sale to RK, a personal family
friend. Plaintiffs allege that “Register represented to [Kathleen] that he would assist
the Plaintiffs in completing the sale of the insurance to RK and would credit the sale
to her, or one of her licensed agents, who would receive a Producer’s appointment.”
Plaintiffs also allege that multiple members of their staff were licensed and could
legally be appointed as producer for a sale. At the pleading stage, these allegations
sufficiently allege justifiable reliance. Although it is true that Kathleen and her staff
could have followed up with Register or RK to check on the status of the sale, it is
also true that Kathleen alleges she was under extraordinary stress, Register knew this
fact, and Register spoke in this context when telling her he was acting as her business
advisor. On motions to dismiss, the Iowa Supreme Court has been “unwilling to hold
as a matter of law that” reliance is not justified in specific circumstances. See Dier,
815 N.W.2d at 9 (“At the pleading stage, . . . we are unwilling to hold as a matter of
law that a putative father can never rely on a mother’s representation that he is the
father and must immediately insist upon paternity testing.”). Although Defendants
argue reliance was clearly unjustified, the Iowa Supreme Court’s approach appears
to acknowledge the importance of permitting discovery and development of the
record to assess the nuanced question of whether reliance is justified. At this stage,
Plaintiffs plausibly allege justifiable reliance as required to support claims of fraud
and negligent representation as to the RK sales.
E. Other Claims
Plaintiffs also brought claims alleging fraudulent or intentional
misrepresentation and negligent misrepresentation that did not relate to the sale of life
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insurance products to RK (Counts I–II) and misappropriation of trade secrets (Count
V).4 On our review of the pleadings, we agree with the district court that Plaintiffs
failed to adequately state claims upon which relief can be granted. Accordingly, we
affirm the partial dismissal of Counts I–II and the dismissal of Count V.
III. Conclusion
We reverse the judgment of the district court as to Plaintiffs’ breach of
fiduciary duty claim and those portions of the breach of contract, unjust enrichment,
and fraud or negligent misrepresentation claims relating to the sale of life insurance
products to RK. As to these claims, we remand for further proceedings consistent
with this opinion. As to all other claims, we affirm the judgment of the district court.5
___________________________
4We note, as a final matter, that Defendants raise several arguments under
Iowa’s insurance law, specifically sections of Chapter 522B, which govern the
licensing of insurance producers. Most of these arguments pertain to the legality of
Kathleen receiving a commission for the sale of annuities to herself. Because we
agree with the district court’s dismissal of Plaintiffs’ annuity-related claims, we do
not address these statutory arguments. Defendants also argue that neither Kathleen
nor any of her colleagues were sufficiently licensed to be able to receive commissions
from either the sale to Kathleen or the sale to RK. At this stage in the litigation, the
Complaint sufficiently alleges licensing was in place.
5To the extent our opinion does not moot Plaintiffs’ appeal of the district
court’s ruling denying their motion under Federal Rules of Civil Procedure 52(b) and
59(e), we affirm the district court’s denial.
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