UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
CIVIL ACTION NO. 1:14-CV-935
MICHAEL McADOO and KENYA
McBEE, individually and on behalf of
all others similarly situated,
Plaintiffs,
v.
THE UNIVERSITY OF NORTH
CAROLINA AT CHAPEL HILL,
Defendant.

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DEFENDANT THE UNIVERSITY OF
NORTH CAROLINA AT CHAPEL
HILL’S MEMORANDUM OF LAW IN
SUPPORT OF MOTION TO DISMISS

NOW COMES Defendant the University of North Carolina at Chapel Hill
(“UNC” or “University”), through the undersigned counsel, and respectfully submits this
Memorandum of Law in support of its Motion to Dismiss.
NATURE OF THE CASE
Plaintiffs Michael McAdoo and Kenya McBee, former scholarship studentathletes, bring their complaint challenging the education provided to them by the
University. Plaintiffs’ First Amended Complaint, which seeks class-action status, asserts
claims for breach of contract, breach of fiduciary duty, violation of N.C. Gen. Stat. § 751.1, and various fraud-based claims.

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 In this action, Plaintiffs seek to bring claims against the University which are
barred by the Eleventh Amendment, the University’s sovereign immunity and the
applicable statutes of limitations. None of Plaintiffs’ claims for money damages or other
relief is supported by either the facts pled or North Carolina law. Accordingly, the
University moves to dismiss on the grounds more fully set forth below.
STATEMENT OF FACTS
For purposes of this motion, the operative facts are supplied by Plaintiffs’
Complaint, the First Amended Complaint and the record from Plaintiff Michael
McAdoo’s previous action against the University, McAdoo v. University of North
Carolina at Chapel Hill (McAdoo I). See Andrews v. Daw, 201 F.3d 521, 524 n. 4 (4th
Cir. 2000) (stating, “when entertaining a motion to dismiss on the ground of res judicata,
a court may take judicial notice of facts from a prior judicial proceeding when the res
judicata defense raises no disputed issue of fact”); Mills v. Duke Univ., No. 1:12CV447,
2014 WL 7150684, at *3 (M.D.N.C. Dec. 15, 2014) (taking judicial notice of prior
proceedings).
Former student-athletes Michael McAdoo (“McAdoo”) and Kenya McBee
(“McBee”) allege that from 1993 to 2011, the University entered into scholarship
agreements with student-athletes under which it promised a University education in
exchange for student-athletes’ participation in athletics. First Amended Complaint
(“FAC”) ¶¶ 1, 87. Plaintiffs point to the University’s Mission Statement, publicity
materials, and student-athlete handbook as describing the University’s education as
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 excellent. Id. ¶¶ 5-8. However, Plaintiffs do not claim that they read or were aware of
these materials, or that these materials were the basis of their decision to enroll at the
University. Instead they allege that University coaches, academic counselors, and other
representatives assured Plaintiffs and other student-athletes that they would care for the
students “as part of the Tar Heel Family.” Id. ¶¶ 1, 91.
Plaintiffs claim that rather than providing student-athletes with the excellent
education touted in marketing materials, the University allegedly funneled studentathletes into non-rigorous classes “designed to provide virtually no education.” Id. ¶ 1.
This “shadow curriculum” was offered through the Department of African and AfroAmerican Studies (the “AAAS Department”) and involved no class meetings, no faculty
feedback, and no communication with the professor. Id. ¶¶ 22, 39. Although students in
these courses would have to have been aware at the time of taking the courses that they
involved no attendance or interaction with the professor, Plaintiffs claim that they were
unable to uncover the nature and scope of the academic impropriety. Id. ¶ 48.
McAdoo alleges he was a stand-out high school football player recruited by
dozens of universities from across the country. Compl. ¶ 23. McAdoo was recruited to
attend the University by former football coaches Butch Davis, John Blake, and Charlie
Williams. Id. ¶ 24. McAdoo claims that during visits, Davis touted the strength of the
academics offered by the University and the football program’s commitment to
academics. Id. ¶ 25. McAdoo also claims that he was promised that the University would

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 care for him “as family.” FAC ¶¶ 51-52. McAdoo ultimately accepted a scholarship
offer from the University to play football. Id. ¶ 53.
McAdoo alleges that immediately upon arriving at the University in 2008, he
realized that the promises made by Coach Davis and his assistants about the football
program’s commitment to academics were false. Compl. ¶ 28. McAdoo also claims that
he was immediately “shifted away from his desired academic track”. FAC ¶ 54.
McAdoo claims to have questioned his enrollment in the “shadow curriculum” and
to have expressed a desire to take more meaningful courses, but does not contend he
attempted to enroll in more challenging courses or was prevented by the University from
enrolling in the classes of his choice. Compl. ¶ 30. He does not claim that he had no
choice or was required to take the classes, but claims he trusted his advisors and was told
taking the courses would accommodate his football schedule and show his commitment
to football. FAC ¶¶ 54, 56. On October 14, 2010, McAdoo was found guilty of an
Honor Court violation by the University’s Honor Court for receiving impermissible
assistance from his tutor on one of his papers. McAdoo I Complaint ¶¶ 8, 90 (attached
hereto as Exhibit A). As a result of this Honor Code violation and other violations of
NCAA bylaws, the NCAA declared McAdoo permanently ineligible to participate in
college sports on November 12, 2010. Id. ¶¶ 9, 12, 95.
In 2011, McAdoo filed a lawsuit against the University, former Chancellor Holden
Thorp, and the NCAA bringing claims for breach of contract, breach of fiduciary duty,
negligence, libel, and tortious interference with contract seeking reinstatement on the
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 University’s football team and damages. Id. at Prayer for Relief. McAdoo’s complaint
was dismissed in its entirety on November 23, 2011 for failure to state a claim upon
which relief can be granted, lack of standing, lack of justiciable controversy, estoppel,
and sovereign immunity. See McAdoo v. Uni. of N.C. at Chapel Hill, No. 11-3903, 2011
WL 8363727 (N.C. Super. Nov. 23 2011) (McAdoo I Dismissal, attached hereto as
Exhibit B). The North Carolina Court of Appeals affirmed the trial court’s dismissal of
McAdoo’s case on January 15, 2013. See McAdoo v. University of North Carolina at
Chapel Hill, et. al, 736 S.E.2d 811 (N.C. Ct. App. 2013) (McAdoo I Appeal, attached
hereto as Exhibit C).
McAdoo attended the University from 2008 to 2011, but did not graduate. Compl.
¶ 35; FAC ¶ 58. Instead, he withdrew from the University in 2011 and signed a contract
to play in the National Football League. FAC ¶ 58. McAdoo is apparently no longer
playing professional football, as he claims to be unable to secure employment. Id. ¶ 58.
McAdoo does not allege that he has made any attempts to secure employment or
complete his education.1
Like McAdoo, McBee was a star high school athlete and received many college
scholarship offers. FAC ¶ 59. McBee was recruited to play basketball at the University
by coaches Sylvia Hatchell and Tracey Williams and academic counselor Jan Boxill. See
1

As a former student-athlete in good standing who withdrew from the University prior to completing his education,
McAdoo is eligible for Complete Carolina, an initiative that would allow him to complete his education at the
University with the financial assistance commensurate with his former scholarship. See Univ. of N.C. at Chapel
Hill, Athletics: Complete Carolina, http://www.goheels.com/ViewArticle.dbml?DB_OEM_ID=3350&ATCLID=
209573461 (last visited Apr. 22, 2015). The complete Carolina program also offers academic and career counseling
to former student athletes who return to complete their degrees. Id.

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 id. ¶¶ 61-64. During her recruitment, McBee claims that Hatchell, Williams, and Boxill
emphasized the excellent education she would receive at the University. See id. McBee
aspired to be a sports journalist and wished to major in journalism and mass
communications. Id. ¶ 61. McBee’s recruiters told her that the University offered this
major and allegedly emphasized the opportunities McBee would have in journalism after
graduation. Id. ¶¶ 61, 63. According to McBee, “UNC seemed the perfect fit” and she
agreed to attend, enrolling in 2001. Id. ¶¶ 19, 66.
McBee alleges that at the beginning of her freshman year, she was told that
“majoring in journalism and mass communications would not be possible” due to her
basketball schedule. Id. ¶ 67. Although McBee claims to have been “perplexed” by this,
as it was counter to her expressed interest, she enrolled in “shadow curriculum” classes in
the AAAS department and pursued a communications major with a specialization in
interpersonal communications. See id. ¶¶ 67-70. McBee alleges that she was counseled
by her coaches and Boxill to pursue a different academic path than her previously
expressed interests suggested. See id. ¶¶ 67-68. McBee was “unenthusiastic” about her
course of study, but focused on courses she thought would give her the knowledge and
skills to obtain a job in journalism upon graduating. Id. ¶ 70.
McBee attended the University from 2001 to 2005, and graduated in 2006 with a
double major in interpersonal communications and AAAS. Id. ¶¶ 19, 70, 71. McBee has
concluded that “journalism is not a realistic career ambition,” but does not allege how she

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 reached that conclusion or that she has made any efforts to obtain a job in the journalism
field since graduating. Id. ¶ 72.
McAdoo, on behalf of himself and a class of persons who attended the University
on football scholarships between 1993 and 2011, filed suit against the University on
November 6, 2014. Compl. ¶ 32. On February 24, 2015, McAdoo’s complaint was
amended to add McBee as a named plaintiff and expand the proposed class to “all
persons who attended UNC on athletic scholarships between 1993 and at least 2011.”
FAC ¶ 73. Plaintiffs claim that the University’s actions have caused them injury by
“stunting their intellectual and academic growth and hampering their future career
options,” id. ¶ 104, and that they have suffered unspecified “economic losses, and other
general and specific damages,” id. ¶ 94. Based on these allegations, Plaintiffs have
brought six claims against the University: breach of contract, breach of fiduciary duty,
violation of North Carolina’s Unfair and Deceptive Trade Practices Act, fraud in the
inducement, constructive fraud, and fraudulent concealment.
Plaintiffs seek monetary damages and prospective declaratory and injunctive
relief, including the “provision of four-year guaranteed scholarships to all studentathletes going forward” and a “court appointee reviewing the curriculum and course
selection for all student-athletes going forward for five years.” Id. at Prayer for Relief.

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 QUESTIONS PRESENTED
1.

Whether Plaintiffs’ claims are barred by the Eleventh Amendment.

2.

Whether Plaintiffs’ claims are barred by the statute of limitations.

3.

Whether Plaintiffs’ claims and request for injunctive relief should be
dismissed for lack of standing.

4.

Whether Plaintiffs’ claims should be dismissed for failure to state a
claim upon which relief can be granted.

5.

Whether Plaintiff Michael McAdoo’s claims are barred by res
judicata.
DISMISSAL STANDARD

A motion pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure may
assert either that the complaint fails to state facts upon which subject-matter jurisdiction
may be based, or attack the existence of subject matter jurisdiction in fact, apart from the
complaint. Kerns v. U.S., 585 F.3d 187, 192-93 (4th Cir. 2009) (citing Adams v. Bain,
697 F.2d 1213, 1219 (4th Cir. 1982)). Once a defendant has made such a challenge, the
plaintiff bears the burden of showing that federal jurisdiction is appropriate. U.S. ex rel.
Vuyyuru v. Jadhav, 555 F.3d 337, 347 (4th Cir. 2009); see also Evans v. B.F. Perkins
Co., 166 F.3d 642, 647 (4th Cir. 1999).
To survive a motion to dismiss for failure to state a claim upon which relief can be
granted pursuant to Rule 12(b)(6), a complaint must meet the pleading standards of
Federal Rule of Civil Procedure 8, which “governs the pleading standard ‘in all civil
actions and proceedings in the United States district courts.’” Ashcroft v. Iqbal, 556 U.S.
662, 684 (2009) (citation omitted). To avoid dismissal, the complaint here must contain
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 facts sufficient “to raise a right to relief above the speculative level” and to satisfy the
court that the claim is “plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555, 570 (2007); accord Painter’s Mill Grille, LLC v. Brown, 716 F.3d 342, 350 (4th Cir.
2013). A claim is plausible only “when the plaintiff pleads factual content that allows the
court to draw the reasonable inference that the defendant is liable for the misconduct
alleged” – a standard that requires more than facts “that are ‘merely consistent with’ a
defendant’s liability.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557); U.S. ex
rel. Nathan v. Takeda Pharm. N. Am., Inc., 707 F.3d 451, 455 (4th Cir. 2013).
Although all well-pled allegations are presumed to be true and must be viewed in
the light most favorable to the plaintiff, Giarratano v. Johnson, 521 F.3d 298, 302 (4th
Cir. 2008), “[t]hreadbare recitals of the elements of a cause of action, supported by mere
conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S.
at 555); see also Brown, 716 F.3d at 350. Similarly, a court need not accept as true a
plaintiff’s “unwarranted inferences, unreasonable conclusions, or arguments,”
Giarratano, 521 F.3d at 302 (citation omitted) (internal quotation marks omitted), or “a
legal conclusion couched as a factual allegation,” Twombly, 550 U.S. at 555 (citation
omitted) (internal quotation marks omitted).

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 ARGUMENT
I.

PLAINTIFFS’ CLAIMS AGAINST THE UNIVERSITY ARE BARRED BY
THE ELEVENTH AMENDMENT
Plaintiffs cannot bring their state law claims against the University in federal

court. Diversity jurisdiction is lacking. Moreover, the State of North Carolina has
retained its sovereign immunity in any court against Plaintiffs’ claims and thus they
should be dismissed with prejudice.
A.

This Court Lacks Subject Matter Jurisdiction

To pursue their lawsuit in this Court, Plaintiffs must establish that this Court has
jurisdiction over the subject matter of the action. Evans, 166 F.3d at 647 (plaintiffs have
the burden of showing that subject matter jurisdiction exists). Here, Plaintiffs cannot
meet this burden, because this case neither arises under federal law nor involves diverse
parties. See 28 U.S.C. § 1331 (federal question jurisdiction); 28 U.S.C. § 1332 (diversity
jurisdiction).
Plaintiffs have brought six claims arising under state law, and the case presents no
questions of federal law. See FAC ¶¶ 85-117. Thus, Plaintiffs’ only asserted basis for
federal jurisdiction is diversity between the parties. See id. ¶ 16. Plaintiffs assert that the
parties are diverse because Plaintiffs are citizens of Maryland and South Carolina,
respectively, and Defendant is a citizen of North Carolina. Id. ¶ 16. However, the
University, the only named Defendant, is a state agency and not a “citizen” for purposes
of federal diversity jurisdiction. In Maryland Stadium Authority v. Ellerbe Becket, Inc.,

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 407 F.3d 255, 260 (4th Cir. 2005), the Court of Appeals for the Fourth Circuit held that
because a public university plaintiff was not a “citizen” of Maryland, it was not
competent to sue, or liable to be sued, in federal court under 28 U.S.C. § 1332, and the
district court did not have original jurisdiction over the action. Likewise, the University
is a State agency rather than a citizen of the State. See e.g., Huang v. Bd. of Governors of
the Univ. of N.C., 902 F.2d 1134, 1139 (4th Cir. 1990) (finding that a constituent
institution of the University of North Carolina was the alter ego of the State); Costello v.
Univ. of N.C. at Greensboro, 394 F. Supp. 2d 752, 761 (M.D.N.C. 2005) (noting that a
suit against a constituent of the UNC System is a suit against the State). Thus, diversity
jurisdiction is lacking, this Court lacks subject matter jurisdiction, and the case should be
dismissed.
B.

The Eleventh Amendment Bars Plaintiffs From Asserting State Law
Claims Against The University In Federal Court.

The United States Supreme Court has interpreted the Eleventh Amendment to
preclude suits against state governments in federal court, whether brought by their own
citizens or citizens of other states, regardless of whether the suit is in law or equity. See
e.g., Hans v. Louisiana, 134 U.S. 1, 15 (1890); Edelman v. Jordan, 415 U.S. 651 (1974).
According to the Supreme Court, “[t]he ultimate guarantee of the Eleventh Amendment
is that nonconsenting States may not be sued by private individuals in federal court.” Bd.
of Trs. of the Univ. of Ala. v. Garrett, 531 U.S. 356, 363 (2001). Thus, unless Congress
has specifically abrogated immunity or the State has consented to suit in federal court, the
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 federal courts are deprived of jurisdiction. Edelman, 415 U.S. at 678; see also Pennhurst
State Sch. & Hosp. v. Halderman, 465 U.S. 89, 99-100 (1989) (“A State’s constitutional
interest in immunity encompasses not merely whether it may be sued, but where it may
be sued.”).
This constitutional guarantee applies not only to suits against the State itself but
also to suits where “one of [the State’s] agencies or departments is named as the
defendant.” Pennhurst State Sch. & Hosp., 465 U.S. at 100. The University as a State
agency enjoys the protections of the State’s Eleventh Amendment immunity. See, e.g.,
Huang, 902 F.2d at 1139 (holding that a constituent institution of the University of North
Carolina was the alter ego of the State and entitled to Eleventh Amendment immunity);
see also Guseh v. N.C. Cent. Univ. ex rel. The Bd. of Governors of the Univ. of N.C., 423
F. Supp. 2d 550, 561 (M.D.N.C. 2005) (determining that, for Eleventh Amendment
purposes, state universities share the State’s sovereign immunity).
Plaintiffs have alleged neither of the immunity exceptions, and neither is
applicable here. First, Plaintiffs assert only state law claims and fail to allege any
abrogation of the State’s immunity by Congress. See FAC ¶¶ 85-117. Nor has Congress
abrogated the States’ sovereign immunity for any of the state law claims asserted by
Plaintiff. See, e.g., Johnson v. North Carolina, 905 F. Supp. 2d 712, 723 (W.D.N.C.
2012) (applying Eleventh Amendment immunity to bar state law claims where Plaintiffs
did not allege Congressional waiver and noting that Congress had not waived immunity
for such claims).
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 Second, although a State also may consent to suit against it in federal court, such
consent must be unequivocally expressed. Edelman, 415 U.S. at 673. Here, Plaintiffs
fail to assert that the State has consented to suit in federal court, and the State of North
Carolina has not consented to suit in federal court on Plaintiffs’ state law claims. See,
e.g., Housecalls Home Health Care, Inc. v. U.S. Dep’t. of Health and Human Servs., 515
F. Supp. 2d 616 (M.D.N.C. 2007) (holding that the State of North Carolina had not
consented to suit on a breach of contract claim in federal court); Hooper v. North
Carolina, 379 F. Supp. 2d 804, 812 (M.D.N.C. 2005) (holding that the Eleventh
Amendment barred Plaintiff’s breach of contract and tort claims against the State and a
constituent institution of The University of North Carolina); Ji-Da Dai v. Univ. of N.C.,
No. 1:02CV224, 2003 WL 22113444, at *5 n. 5 (M.D.N.C. Sept. 2, 2003) (holding that
the University was entitled to Eleventh Amendment immunity in federal court for
common law tort claims and breach of contract claim). Indeed, as discussed further
below, North Carolina retains immunity against these claims even in State court.
C.

In Addition, The State Of North Carolina Retains Its Sovereign
Immunity Against Plaintiffs’ Claims In Any Court.

Separate and apart from the Eleventh Amendment and regardless of the forum in
which the case was filed, the State has sovereign immunity against Plaintiffs’ claims. “It
has long been the established law of North Carolina that the State cannot be sued except
with its consent or upon its waiver of immunity.” Guthrie v. N.C. State Ports Auth., 299
S.E.2d 618 (N.C. 1983); see also Phillips v. N.C. A & T State Univ., 2009 WL 5215377,
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 at *2 (M.D.N.C. Dec. 28, 2009) (“Thus, in North Carolina, [c]laims for tort liability are
allowed only by virtue of the express waiver of the State’s immunity.” (alteration in
original) (citation omitted) (internal quotation marks omitted)). Governmental or
sovereign immunity holds that a party cannot successfully sue the State or its agencies for
acts undertaken in performance of governmental duties unless the State waives
governmental immunity. Corum v. The Uni. of N.C. Through Bd. of Governors, 413
S.E.2d 276, 283, 291 (N.C. 1992). The University of North Carolina is included within
the State’s sovereign immunity. See, e.g., Kawai Am. Corp. v. Univ. of NC. at Chapel
Hill, 567 S.E.2d 215, 217 (N.C. Ct. App. 2002); Harwood v. Johnson, 238, 388 S.E.2d
439, 443 (N.C. 1990).
“A waiver of sovereign immunity must be established by the General
Assembly…It is for the General Assembly to determine when and under what
circumstances the State may be sued.” Wood v. N.C. State Univ., 556 S.E.2d 38, 40 (N.C.
Ct. App. 2001) (citation omitted) (internal quotation marks omitted). Moreover, a
plaintiff must allege that a waiver has occurred in order to take advantage of the waiver
and state a proper claim for relief. Whitaker v. Clark, 427 S.E.2d 142, 145 (N.C. Ct. App.
1993). In this case, Plaintiffs have not and cannot allege a waiver and sovereign
immunity applies to each claim.
First, Plaintiffs’ intentional tort claims for breach of fiduciary duty (Count II),
fraud in the inducement (Count IV), constructive fraud (Count V) and fraudulent
concealment (Count VI) are barred. Sovereign immunity bars intentional tort claims
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 brought against the State. See Kawai, 567 S.E.2d at 218. As the Court of Appeals has
explained:
Suits against the State, its agencies and its officers for alleged tortious acts
can be maintained only to the extent authorized by the Tort Claims Act, and
that Act authorizes recovery only for negligent torts. Intentional torts
committed by agents and officers of the State are not compensable under
the Tort Claims Act.
Id. at 217.2
Thus, fraud and breach of fiduciary claims such as those asserted here must be
dismissed on sovereign immunity grounds. See Wojsko v. State, 267 S.E.2d 708, 710-11
(N.C. Ct. App. 1980) (dismissing fraudulent inducement claim); Herring v. WinstonSalem/Forsyth Cnty. Bd. of Educ., 529 S.E.2d 458 (N.C. Ct. App. 2000) (dismissing
constructive fraud claim); Piedmont Inst. of Pain Mgmt. v. Staton Found., 581 S.E.2d 68,
76-77 (2003) (dismissing breach of fiduciary duty and constructive fraud claims).
Second, although the State waives sovereign immunity when it enters into a valid
contract, Smith v. State, 222 S.E.2d 412, 423-24 (N.C. Ct. App. 1976), “[o]nly when the
State has implicitly waived sovereign immunity by expressly entering into a valid
contract through an agent of the State expressly authorized by law to enter into such
contract may a plaintiff proceed with a claim against the State upon the State’s breach,”
Whitfield v. Gilchrist, 497 S.E.2d 412, 415 (N.C. 1998). For the reasons stated below,
Plaintiffs have failed to allege a valid, enforceable contract and subsequent breach of that

2

Although Plaintiff has not alleged negligence, to the extent any of these claims could be construed as asserting
negligence, the claim still should be dismissed. The Tort Claims Act exclusively designates the Industrial
Commission to hear negligence claims. Wojsko v. State, 267 S.E. 2d 708, 711 (N.C. Ct. App. 1980).

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 contract by the University. Plaintiffs’ breach of contract claim is therefore barred by
sovereign immunity.
Finally, Plaintiffs’ claim under N.C. Gen. Stat. § 75-1.1 for unfair trade practices
(Count III) cannot be brought against the State. This Court has already held that
sovereign immunity bars Section 75-1.1 claims against the University. Bd. of Governors
of Uni. of N.C. v. Helpingstine, 714 F. Supp. 167, 174 (M.D. N.C. 1989) (finding that
sovereign immunity protects UNC-Chapel Hill from suit under Section 75-1.1).
II.

PLAINTIFFS’ CLAIMS ARE TIME BARRED
Each of Plaintiffs’ claims is barred by the applicable statute of limitations, as is

apparent by facts pled or which are judicially noticeable by this Court. Plaintiffs’ claims
are based on allegedly irregular classes offered to students at the University between the
fall of 1993 and the second summer session of 2011. However, McAdoo attended the
University from 2008 until he left voluntarily in August of 2011 to join the NFL.
McAdoo, 736 S.E.2d at 819-20 (McAdoo I Appeal, Exhibit C) (“In August 2011, before
the start of his senior year, [McAdoo] applied for and was declared eligible for the
supplemental draft in the National Football League.”). While he does not plead which
irregular classes he was enrolled in or when, the latest would have to have been in the
summer session of 2011 or prior. Plaintiff McBee attended the University from 2001
until she graduated in 2006, and thus the last class she could have been enrolled in was in
the Spring Session of 2006.

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 Under North Carolina law, the statute of limitations for breach of contract, breach
of fiduciary duty and fraud-based claims is three years from the date the cause of action
accrues. N.C. Gen. Stat. Ann. § 1-52(1), (9); Penley v. Penley, 332 S.E.2d 51, 62 (N.C.
1985); Miller v. Randolph, 478 S.E.2d 668, 670 (N.C. Ct. App. 1996); Trillium Ridge
Condo Ass’n v. Trillium Links& Village, LLC, 764 S.E.2d 203, 219 (N.C. Ct. App. 2014);
Brissett v. First Mount Vernon Indus. Loan Ass’n, 756 S.E.2d 798, 805 (N.C. Ct. App.
2014). The limitations period for N.C. Gen. Stat. § 75-1.1 is four years from the date the
cause of action accrues. N.C. Gen. Stat. Ann. §75-16.2; Stony Point Hardware and Gen.
Store, Inc. v. People’s Bank, 714 S.E.2d 866, 2011 WL 3569967, at *9 (N.C. Ct. App.
2011) (unpublished table decision). McAdoo filed the initial Complaint against the
University on November 6, 2014 and thereafter amended to include McBee on February
24, 2015.
Based on the applicable statute of limitations, Plaintiffs’ breach of contract,
fiduciary duty and fraud claims would only be viable if they accrued on or after
November 2011 (for McAdoo) or February 2012 (for McBee), and their Section 75-1.1
claim on or after November 2010 or February 2011, respectively. “It is a well-settled
rule . . . that the statute of limitations for a breach of contract action is not tolled pending
the injured party’s discovery of the breach . . . a plaintiff’s lack of knowledge concerning
his claim does not postpone or suspend the running of the statute of limitations.” Flexible
Foam Prod., Inc. v, Vitafoam Inc., 980 F. Supp. 2d 690, 701 (W.D.N.C. 2013) (citing
Pearce v. N.C. State Highway Patrol Voluntary Pledge Comm., 312 S.E.2d 421, 425-26
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 (N.C. 1984)). Like their breach of contract claim, Plaintiffs’ Section 75-1.1 claim
accrues when the violation occurs. Lucky Ducks, Ltd. V. Leeds, 664 S.E.2d 78, 2008 WL
2968123, at *3 (N.C. Ct. App. 2008) (unpublished table decision).
Although breach of fiduciary duty and fraud based claims do not accrue until the
party has discovered the facts constituting the basis of the claim, “discovery” means
either “actual discovery” or when the facts should have been discovered in the exercise of
reasonable diligence. Brisset, 756 S.E.2d at 805. Here, both Plaintiffs allege that they
were immediately aware upon arriving on campus that the University did not live up to
the promises it allegedly made during their recruitment. See Compl. ¶ 28 (“In 2008,
almost immediately after arriving at the University to begin his freshman year, Mr.
McAdoo realized that the promises made… about the football program’s commitment to
academics were false.”) (emphasis added); FAC ¶ 54 (“In 2008, almost immediately after
arriving at UNC to begin his freshman year, Mr. McAdoo was shifted away from his
desired academic track.”); Id. ¶ 67 (stating that McBee was “perplexed” when she was
told she could not pursue a journalism major “soon after arriving at UNC to begin her
freshman year”); Id. ¶ 69 (alleging that a keyboarding class McBee took with Mary
Willingham, who was not a professor, substituted for her math requirement). McAdoo
and McBee’s allegations make clear that they were on notice of the facts giving rise to
their claims as early as 2008 and 2001, respectively. Moreover they were fully aware
prior to leaving the University of the course schedules in which they had been enrolled
and what the courses they took entailed.
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 Because Plaintiffs’ claims accrued outside the statute of limitations period, their
claims should be dismissed as time barred. See Stony Point, 2011 WL 3569967, at *4
(stating that when “the evidence is clear and shows without conflict that the claimant had
both the capacity and opportunity to discover the fraud but failed to do so, the absence of
reasonable diligence is established as a matter of law.” (citation omitted) (internal
quotation marks omitted)).3
III.

PLAINTIFFS LACK STANDING TO PURSUE THEIR CLAIMS AND
OBTAIN INJUNCTIVE RELIEF
Plaintiffs lack standing to bring their claims against the University, therefore their

complaint should be dismissed. The constitutional requirements of Article III require that
the Plaintiffs have standing to pursue the claim, meaning: (1) they suffered an actual or
imminent injury in fact which is both concrete and particularized; (2) that such injury is
traceable to the conduct of the party sought to be held liable; and (3) that the injury will
be redressed by a favorable decision. Stephens v. Cnty. of Albemarle, Va., 524 F.3d 485,
491 (4th Cir. 2008). Likewise, under North Carolina law, “[s]tanding is a necessary

3

While North Carolina recognizes that a defendant’s fraudulent concealment of a material fact can toll the running
of a statute of limitations, a plaintiff must show (1) the defendant fraudulently concealed facts, (2) the plaintiff failed
to uncover those facts during the statutory period, despite (3) the exercise of due diligence. Yancey v. Remmington
Arms Co., LLC, 2013 WL 5462205, at *6 (M.D.N.C. Sept. 30, 2013). Moreover, to plead tolling based on
fraudulent concealment, facts must be plead with particularity beyond mere conclusory allegations. Id. As set forth
above, Plaintiffs’ own allegations belie any notion that material facts were fraudulently concealed. See Compl. ¶ 28;
FAC ¶ 54 (stating that McAdoo realized UNC alleged promises were false); FAC ¶ 67 (stating that McBee
discovered the promises made about her academic track during recruitment were untrue at the beginning of her
freshman year in 2001). Moreover, Plaintiffs base this lawsuit on alleged inadequacies of classes that would have
been readily apparent to them at the time they were enrolled in those classes. See FAC ¶ 39.

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 prerequisite to a court’s proper exercise of subject matter jurisdiction.” Aubin v. Susi,
560 S.E.2d 875, 878 (N.C. Ct. App. 2002).
A.

Plaintiffs’ Alleged Injury is Merely Conjectural or Hypothetical

In order to establish standing, a party must demonstrate that they have suffered an
“‘injury in fact,’-an invasion of a legally protected interest that is (a) concrete and
particularized and (b) actual and imminent, not conjectural or hypothetical.” Marriott v.
Chatham Cnty., 654 S.E.2d 13, 16 (N.C. Ct. App. 2007). In this case, Plaintiffs have
failed to allege that they suffered a particularized actual loss, therefore they lack standing
to bring their claims against the University.
Plaintiffs have simply set forth no allegations that the University’s conduct caused
them injury. While McAdoo alleges that he is “out of work and unable to secure
employment” and McBee states that “she has continued to play basketball for lack of
other realistic options,” neither Plaintiff alleges that these are injuries caused by the
University’s breach of the scholarship agreements. FAC ¶¶ 58, 72. Even if Plaintiffs’
allegations regarding their current employment status could be construed as damages,
these injuries are too hypothetical and speculative to provide them with standing.
North Carolina law requires that “the party seeking damages must show that the
amount of damages is based upon a standard that will allow the finder of fact to calculate
the amount of damages with reasonable certainty.” Olivetti Corp. v. Ames Bus. Sys., Inc.,
356 S.E.2d 578, 586 (N.C. 1987). North Carolina courts have held damages similar to
those which Plaintiffs in this case seem to claim to be too hypothetical to survive a
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 motion to dismiss. See e.g., Arendas v. N.C. High Sch. Athletic Ass’n, 718 S.E.2d 198,
200 (N.C. Ct. App. 2011).
In Arendas, two high school basketball players sued the North Carolina High
School Athletic Association after their school’s state championship win was vacated and
they were declared ineligible to participate in high school athletics for one year. Id. at
199. The athlete plaintiffs claimed that they could suffer injury in the form of lost
scholarships, lost job opportunities, and lost college prospects. Id. at 200. The appeals
court held that these possibilities were all hypothetical and since the plaintiffs did not
suffer a particularized loss, they lacked standing to bring their suit. Id. at 200. The
appeals court in McAdoo I adopted similar reasoning in holding that McAdoo’s
allegations that if the University had not breached its contractual obligations to him, his
subsequent earnings “as an NFL football player would have been greater than those he
actually obtained as a free agent” were too hypothetical and speculative to provide him
with standing. McAdoo, 736 S.E.2d at 821-22 (McAdoo I Appeal, Exhibit C).
The same result is dictated in this case. Although Plaintiffs have not clearly
alleged any damages as a result of the University’s alleged wrongdoing, to the extent
their allegations regarding their employment statuses are the basis of their damages
claims, these damages are too hypothetical and speculative to provide them with standing
and their claims should be dismissed pursuant to 12(b)(1).

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 B.

Plaintiffs Have Not Traced Their Alleged Injury to the University’s
Conduct

Plaintiffs also cannot satisfy the second element to establish standing: an injury
fairly traceable to the University’s alleged wrongdoing. An injury is fairly traceable to
the challenged conduct when a causal connection exists “between the injury and the
conduct complained of.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992).
Plaintiffs allege that their “intellectual and academic growth” has been stunted and their
future career options have been hampered, but they do not allege any facts connecting
these alleged damages to the University’s conduct. FAC ¶ 104. Plaintiffs do not allege,
for example, that they have been denied employment because of the education they
received. McAdoo’s injury claim is particularly tenuous because he voluntarily withdrew
from the University prior to completing his degree. FAC ¶ 58. Thus, it is conclusory at
best to contend that any damages he suffered were a result of the University’s actions.
Plaintiffs have failed to set forth facts showing a causal nexus between their alleged
injury and the University’s conduct, therefore they do not have standing to bring their
claims. Venable v. GKN Automotive, 421 S.E.2d 378, 381 (N.C. Ct. App. 1992)
(affirming 12(b)(1) dismissal where plaintiff’s allegations were “conclusory in nature”);
Burgess v. Charlottesville Sav. & Loan Ass’n, 477 F.2d 40, 43 (4th Cir. 1973) (“Mere
conclusory allegations in the complaint are insufficient to support jurisdiction.”).

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 C.

Plaintiffs Do Not Have Standing To Pursue Injunctive Relief

Plaintiffs ask the Court to order injunctive relief including the provision of fouryear guaranteed scholarship to all student-athletes “going forward” and a court review of
the curriculum and course selection for all student-athletes going forward for five years.
See FAC, Prayer for Relief at D. In order to establish standing to pursue injunctive relief,
a plaintiff must be able to show that he or she is likely to suffer future injury. City of Los
Angeles v. Lyons, 461 U.S. 95, 111 (1983) (stating that an injunction is “unavailable
absent a showing of irreparable injury, a requirement that cannot be met where there is no
showing of any real or immediate threat that the plaintiff will be wronged again”).
“[P]ast exposure to illegal conduct does not in itself show a present case or controversy
regarding injunctive relief. . . if unaccompanied by any continuing, present adverse
effects.” Id. at 102 (quoting O’Shea v. Littleton, 414 U.S. 488, 495-96 (1974)).
Plaintiffs have not made, and cannot make, the necessary showing here. McAdoo
attended the University from 2008 to 2011, when he left voluntarily to play in the NFL;
FAC ¶ 58, and McBee attended the University from 2001 until she graduated in 2006, id.
¶ 71. Neither is currently a student-athlete at the University. Courts have routinely found
that plaintiffs who have graduated no longer have standing to pursue injunctive relief
regarding practices that apply only to students, because they will not be subject to those
policies in the future and do not stand to benefit from the injunction. E.g., Mellen v.
Bunting, 327 F.3d 355, 364 (4th Cir. 2003) (stating that students’ “claims for declaratory
and injunctive relief generally become moot when they graduate”); Grandson v. Univ. of
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 Minn., 272 F.3d 568, 574 (8th Cir. 2001) (“That a plaintiff lacks eligibility or is no longer
a student is an adequate basis to dismiss an individual Title IX claim for injunctive
relief.”); Cole v. Oroville Union High Sch., 228 F.3d 1092, 1098 (9th Cir. 2000) (“It is
well-settled that once a student graduates, he no longer has a live case or controversy
justifying declaratory and injunctive relief against a school’s action or policy.”);
Pederson v. La. State Univ., 213 F.3d 858, 874 (5th Cir. 2000) (“As is so often the case in
suits for injunctive relief brought by students, graduation or impending graduation
renders [the plaintiffs’] claims for injunctive relief moot”).4
Moreover, the Fourth Circuit has cautioned against the imposition of such
sweeping permanent injunctions: “Being equitable relief, an injunction should be no
broader than necessary to achieve its desired goals.” Lowery v. Circuit City Stores, Inc.,
158 F.3d 742, 766 (4th Cir. 1998), vacated on other grounds, 527 U.S. 1031 (1999); see
also PBM Prods., LLC v. Mead Johnson & Co., 639 F.3d 111, 128 (4th Cir. 2011) (“It is
well established that injunctive relief should be no more burdensome to the defendant
than necessary to provide complete relief to the plaintiffs.” (citation omitted) (internal
quotation marks omitted)). Accordingly, an injunction is inappropriate — and an abuse
of discretion that will be vacated — “if it is broader in scope than that necessary to
provide complete relief to the plaintiff or . . . does not carefully address only the
4

Plaintiffs’ role as putative class representatives cannot create standing where it otherwise does not exist. As the
Fourth Circuit explained, “it is essential that named class representatives demonstrate standing through a ‘requisite
case or controversy between themselves personally and [defendants],’ not merely allege that ‘injury has been
suffered by other, unidentified members of the class to which they belong and which they purport to represent.’”
Cent. Wesleyan Coll. v. W.R. Grace & Co., 6 F.3d 177, 188 (4th Cir. 1993) (quoting Blum v. Yaretsky, 457 U.S. 991,
1001 n.13 (1982)) (alteration in original) (emphasis added).

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 circumstances of the case.” PBM Prods., 639 F.3d at 128 (citation omitted) (internal
quotation marks omitted). Here, Plaintiffs effectively ask the Court not just to remedy
the particular harms they allege, but to dictate future educational policy changes to the
University. That is not the proper function of injunctive relief, nor even more broadly of
the court system. Cf. EEOC. v. Bloomberg L.P., 778 F. Supp. 2d 458, 485 (S.D.N.Y.
2011) (“[I]t is not the Court’s role to engage in policy debates or choose the outcome it
thinks is best. It is to apply the law.”); Doe v. U.S. Dep’t of Health & Human Servs., No.
14-367 (BAH), 2015 WL 1316290, at *1 (D.D.C. Mar. 24, 2015) (stating that while the
“plaintiff invite[d] judicial involvement” in the debate about sexual misconduct at
universities, courts are empowered to resolve only cases or controversies involving
“legally cognizable claims”). Plaintiffs’ request for injunctive relief should be dismissed.
IV.

PLAINTIFFS FAIL TO STATE CLAIMS UPON WHICH RELIEF CAN BE
GRANTED
A.

Plaintiffs’ Breach Of Contract Claims Should Be Dismissed On
Numerous Grounds.

Plaintiffs’ breach of contract claim against the University must be dismissed on
sovereign immunity grounds, but also on the grounds that it (1) is based on generalized
policy statements that cannot form the basis of a contract; (2) asserts an educational
malpractice theory repeatedly rejected by North Carolina courts; and (3) is precluded by
Plaintiffs’ allegations that the University and student-athletes entered into express
contracts through their scholarship agreements, which lack any terms or clauses to
support Plaintiffs’ claim.
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 Plaintiffs’ claim for breach of contract is based upon statements alleged from the
University’s Mission Statement, marketing material, and Student-Athlete Handbook.
FAC ¶ 88. Yet Plaintiffs do not allege that they even read those statements, or were
aware of them, prior to enrolling at the University. Moreover, this court has repeatedly
refused to allow a school’s general policies, even when expressly stated in the school’s
bulletins and other materials, to form the basis of an enforceable contract with students.
See Rouse v. Duke Univ., 869 F. Supp. 2d 674, 683 (M.D.N.C. 2012) (holding that
school’s anti-discrimination and anti-harassment policies were too general to form the
basis of a contract); Giuliani v. Duke Univ., 2010 WL 129232, at *2, *6-9 (M.D.N.C.
March 30, 2010) (concluding that benefit promises during recruitment, athletic
scholarship agreements, and policy manuals were insufficient to create a binding contract
between student and university); Love v. Duke Univ., 776 F. Supp. 1070, 1075 (M.D.N.C.
1991) (holding that examination requirement in academic bulletin did not create a
binding contract between student and university).5 Similarly, here, Plaintiffs’ only basis
for an enforceable contract with the University is an implied policy insufficient to create
a binding contract. Thus Plaintiffs failed to plead the existence of a valid contract, and
their breach of contract claim should be dismissed.
Because Plaintiffs failed to establish the existence of a valid contract, it follows
that they also cannot establish a material breach of any specific term or provision
5

Plaintiff McAdoo should be well aware of this line of cases, as they form the basis of the court’s dismissal of his
breach of contract claim in his prior action against the University in 2011. See McAdoo I Motion to Dismiss
(attached hereto as Exhibit D) and McAdoo, 2011 WL 8363727 (McAdoo I Dismissal, Exhibit B).

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 necessary to form the basis of a breach of contract claim. McFadyen v. Duke Univ., 786
F. Supp. 2d 887, 981-82 (M.D.N.C. 2011) (holding that a school’s general antiharassment policy was not a specific obligation indicating the school’s intent to be
contractually bound) rev’d and dismissed in part on other grounds, 703 F.3d 636 (4th
Cir. 2012). Plaintiffs’ vague allegations about the University’s alleged promises to “treat
plaintiffs like family,” “provide them with assistance” and “take care of them” do not
constitute a specific obligation. See FAC ¶¶ 52, 62-65.
Plaintiffs’ breach of contract claim is barred because it relies on allegations about
the adequacy and nuances of the University’s educational process that simply are not
actionable. North Carolina does not recognize educational malpractice as a cognizable
claim. Thomas v. Olshausen, 2008 WL 2468738, at *2 (W.D.N.C. June 16, 2008)
(“Insofar as the claims seek to allege that Defendants denied [Plaintiff] or his son access
to more challenging educational programs, the claims should be dismissed as there is no
cognizable claim for educational malpractice under North Carolina law.”). Instead, a
breach of contract claim against a school requires more than an allegation that “the
education was not good enough.” Ryan v. Univ. of N.C. Hosps., 494 S.E.2d 789, 791
(N.C. Ct. App. 1998) (citation omitted) (internal quotation marks omitted). Consistent
with this requirement, courts applying North Carolina law have repeatedly disavowed
inquiries “into the nuances of the educational processes and theories,” see e.g., Supplee v.
Miller-Motte Bus. Coll., Inc., 768 S.E.2d 582, 592 (N.C. Ct. App. 2015); Ryan, 494
S.E.2d at 791, recognizing that “not all aspects of the student/university relationship are
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 subject to a contract remedy,” McFadyen., 786 F. Supp. 2d at 982 (citation omitted)
(internal quotation marks omitted); see also Giuliani v. Duke Univ., 2009 WL 1408869,
at *1, *3 (M.D.N.C. May 19. 2009).
Here, Plaintiffs contend that the University’s alleged “shadow curriculum”
deprived student-athletes of the legitimate education they were promised. This is
precisely the type of educational malpractice claim, based on the adequacy of education,
that North Carolina law prohibits. Moreover, assessing this claim and granting Plaintiffs
the injunctive relief they seek (“a court appointee reviewing the curriculum and course
selection for all student-athletes. . .”) would unequivocally require this Court to evaluate
the general quality of the University’s educational program, an inquiry courts have
repeatedly rejected.
Plaintiffs’ breach of contract claim against the University is premised on the
existence of implied contracts under which named plaintiffs and potential class members
agreed to enroll and participate in sports at the University in exchange for the excellent
education promised by the University’s general policy materials. See FAC ¶ 88.
However, the Complaint also makes reference to an express written contract between the
parties governing the University’s relationship with student-athletes, yet fails to point to
any specific provision of that contract the University allegedly breached: “UNC entered
into scholarship agreements with Plaintiffs and Class members under which Plaintiffs and
Class members agreed to be student-athletes at UNC. In exchange, Plaintiffs and Class
members were promised a UNC education, either explicitly or implicitly.” Id. ¶ 87.
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 Plaintiffs cannot have it both ways by alleging an “explicit” and an “implicit”
contract governing the same issues between the parties. It is well settled North Carolina
law that “an express contract precludes an implied contract with reference to the same
matter.” Vetco Concrete Co. v. Troy Lumber Co., 124 S.E.2d 905, 908 (N.C. 1962).
“There cannot be an express and an implied contract for the same thing existing at the
same time.” Id.
Plaintiffs do not, and cannot, point to any terms in their University scholarship
agreement regarding courses of study, academics, or other references to education.
Indeed, courts recognize that “contractual athletic scholarships . . . only constitute a
promise by the university to provide the student with financial assistance in exchange for
a student’s maintenance of athletic eligibility.” Giuliani v. Duke Uni., 2010 WL 1292321,
at *6 (M.D.N.C. Mar. 30, 2010). In the educational contract context in particular, courts
have repeatedly stated that plaintiffs are obliged to “point to a mutual agreement with
sufficiently definite terms or obligations.” McFadyen, 786 F. Supp. 2d at 982. Logically,
it follows that where an alleged contract clause or term does not exist in the contract, the
term or clause cannot be enforced by a court.
Here, Plaintiffs’ scholarship agreements contain the terms under which the
University provided financial assistance for eligible student-athletes. See e.g., McAdoo
Scholarship Agreement (attached hereto as Exhibit E). The agreements make no mention
and have no definite terms regarding student-athletes’ education at UNC. Plaintiffs
simply cannot pursue a breach of contract claim based on an implied contract theory
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 where they have acknowledged an express contract governing the same subject matter.
Plaintiffs have not and cannot allege that the University breached a specific contract term
or provision in the scholarship agreements with Plaintiffs.
B.

Plaintiffs Fail To Allege Facts That Show The Existence Of A
Fiduciary Duty.

Even if Plaintiffs’ breach of fiduciary duty claim was not barred by sovereign
immunity, the claim should be dismissed pursuant to Rule 12(b)(6). To state a claim for
breach of fiduciary duty, a plaintiff must show a fiduciary duty, a breach of the duty, and
resulting damages. See., e.g., Dalton v. Camp, 548 S.E.2d 704, 709 (N.C. 2001). Plaintiff
cannot establish even the first of these elements as North Carolina law does not recognize
the existence of a fiduciary duty under the circumstances alleged by Plaintiffs. See, e.g.,
Ryan v. Uni. of N.C. Hosp., 609 S.E. 2d 498, 2005 WL 465554, at *3 (N.C. Ct. App. Mar.
1, 2005) (unpublished table decision) (fiduciary relationships not generally found in
academic settings, because educators must serve other interests, including those of the
institution and the public); see also McFadyen, 786 F. Supp. 2d at 987 (dismissing
student-athlete’s breach of fiduciary duty claims); McAdoo, 2011 WL 8363727 (McAdoo
I Dismissal, Exhibit B) ¶ 11. The University’s fiduciary duty is to the public, not to
students like Plaintiffs. N.C. Gen. Stat. § 116-1(b) (“[T]he university shall seek an
efficient use of available resources to ensure the highest quality in its service to the
citizens of the State”).

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 C.

Plaintiffs’ Unfair and Deceptive Trade Practices Act Should Be
Dismissed

Plaintiffs’ claim for violation of N.C. Gen. Stat. § 75-1.1 must be dismissed
because the North Carolina courts have repeatedly held that “the consumer protection and
antitrust laws of Chapter 75 of the General Statutes do not create a cause of action against
the State, regardless of whether sovereign immunity may exist.” Sperry Corp. v.
Patterson, 325 S.E. 2d 642, 644 (N.C. Ct. App. 1985); see also Rea Constr. Co. v. City of
Charlotte, 465 S.E.2d 342 (1996).
V.

PLAINTIFF MCADOO’S CLAIMS ARE BARRED BY RES JUDICATA
The Full Faith and Credit Act, 28 U.S.C. § 1738 (2000), requires federal courts to

apply state res judicata law to determine the preclusive effects of a state court judgment.
Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 293 (2005); In re Genesys
Data Techs, 204 F.3d 124, 129 (4th Cir. 2000); Greengael, LC v. Bd. of Supervisors, 313
F. Appx. 577, 579 (4th Cir. Va. 2008).6
Under North Carolina law, “a final judgment on the merits in one action precludes
a second suit based on the same cause of action between the same parties or their
privies.” Williams v. Peabody, 719 S.E.2d 88, 92 (N.C. Ct. App. 2011) (citation omitted)
(internal quotation marks omitted). Res judicata also applies to “issues which could have

6

Similarly, under federal law, a judgment rendered in a prior case will be given res judicata effect in a subsequent
lawsuit when three conditions are met: (1) the subsequent suit presents the “same cause of action” as the prior suit;
(2) judgment was rendered “on the merits” in the prior suit; and (3) the subsequent suit involves “the same parties or
their privies” as were involved in the prior lawsuit. Ohio Valley Envtl Coal. v. Aracoma Coal Co., 556 F.3d 177, 210
(4th Cir. 2009) (quoting Aliff v. Joy Mfg. Co., 914 F.2d 39, 42 (4th Cir. 1990)).

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 been raised in the prior action but were not.” Clancy v. Onslow Cnty., 564 S.E.2d 920,
923 (N.C. App. Ct. 2002) (citation omitted) (internal quotation marks omitted); see also
Smith v. Bank of the Carolinas, No. 11-1139, 2012 WL 4848993, at *5 (M.D.N.C. Oct.
11, 2012). The party seeking to assert res judicata has the burden of establishing its
elements. Bluebird Corp. v. Aubin, 657 S.E.2d 55, 62 (N.C. Ct. App. 2008). A party
must show “(1) a final judgment on the merits in an earlier suit, (2) an identity of the
causes of action in both the earlier and the later suit, and (3) an identity of the parties or
their privies in the two suits.” Bank of Carolinas, 2012 WL 4848993, at *5 (citing
Moody v. Able Outdoor, Inc., 609 S.E.2d 259, 261 (N.C. Ct. App. 2005)).
In 2011, Plaintiff Michael McAdoo sued the University and other defendants.
McAdoo I Complaint (Exhibit A). He asserted several claims against the University,
including two breach of contract claims (¶¶ 123-136, 149-169), a breach of fiduciary duty
claim (¶¶ 137- 148), four declaratory judgment claims for alleged constitutional
violations (¶¶ 239-270), a claim for writ of mandamus and a claim for injunctive relief
(¶¶ 271-319). Id. ¶¶ 123-169, 239-319; see also McAdoo, 736 S.E.2d 811 (McAdoo I
Appeal, Exhibit C). The superior court dismissed all of McAdoo’s claims pursuant to
Rules 12(b)(1), 12(b)(2) and 12(b)(6), with each claim specifically being dismissed for
failure to state a claim. McAdoo, 2011 WL 8363727 (McAdoo I Dismissal, Exhibit B) ¶
8.7

7

The North Carolina Court of Appeals affirmed the dismissal of Plaintiff’s claims on justiciability grounds.
McAdoo, 736 S.E. 2d at 820 (McAdoo I Appeal, Exhibit C). Plaintiff sought further review in the North Carolina
(cont’d)

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 Under these circumstances, all three of the res judicata elements are met. It is well
settled that a decision to dismiss with prejudice under Rule 12(b)(6) is a decision on the
merits for purposes of res judicata. Lawson v. Toney, 169 F. Supp. 2d 456, 462
(M.D.N.C. 2001) (stating that a Rule 12(b)(6) dismissal “acts as an adjudication on the
merits” for the purposes of res judicata); Dawson v. Allstate Ins., Co., 417 S.E.2d 841,
842 (N.C. Ct. App. 1992) (holding that a “dismissal for failure to state a claim operates as
an adjudication upon the merits” (citation omitted) (internal quotation marks omitted));
see also Federated Dep’t. Stores, Inc. v. Moitie, 452 U.S. 394, 399 n.3 (1981) (stating
that a “dismissal for failure to state a claim under Federal Rule of Civil Procedure
12(b)(6) is a ‘judgment on the merits’” for purposes of res judicata). Each of McAdoo’s
claims against the University was dismissed on that ground, and the dismissal was with
prejudice. McAdoo, 2011 WL 8363727 (McAdoo I Dismissal, Exhibit B).8
Moreover, McAdoo’s prior lawsuit involved the same subject matter and his
current claims could have been brought in that action. Res judicata forecloses further
litigation of all matters of fact or law which were within the scope of the prior proceeding
which the parties, in the exercise of due diligence, could and should have brought
forward for determination. Whitacre P’ship v. Biosignia, Inc., 591 S.E.2d 870, 880 (N.C.
2004) (stating that res judicata applies to “all matters ... that were or should have been
________________________
(cont’d from previous page)
Supreme Court, but the Court denied his petition for review. McAdoo v. Univ. of N.C. at Chapel Hill, 740 S.E. 2d
465 (N.C. 2013) (McAdoo I Denial of Review, attached hereto as Exhibit F).
8

The dismissal was affirmed on justiciability grounds, but the trial court’s decision was not vacated. McAdoo 736
S.E. 2d at 826 (McAdoo I Appeal, Exhibit C).

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 adjudicated in the prior action” (citation omitted) (internal quotation marks omitted));
Housecalls Home Health Care, Inc. v. U.S. Dep’t. of Health and Human Servs., 738
S.E.2d 753, 759 (N.C. Ct. App. 2013) (citing Whitacre, 591 S.E.2d at 880). Under North
Carolina law, where the parties have been afforded a full opportunity to litigate a lawsuit,
all issues arising out of the same series of transactions must be tried together in that suit.
See Lawson, 169 F. Supp. 2d at 463 (holding that plaintiff’s federal negligence claim was
barred by adjudication of plaintiff’s prior state negligence claim where the underlying
facts and theory of liability were identical). A party cannot avoid res judicata by
“shifting legal theories or asserting a new or different ground for relief.” Williams, 719
S.E.2d at 94 (holding that the identity of issues requirement was met where the plaintiff’s
unjust enrichment action pertained to the same property dispute as his previous fraud and
quiet title actions, and emphasizing that “[a]t the heart of both the original and present
lawsuits lies a dispute regarding the four properties”). Thus, where a plaintiff chose not
to have all claims adjudicated in the first lawsuit, he cannot litigate them in a second suit.
Bank of Carolinas, 2012 WL 4848993, at *5 (holding that res judicata barred a plaintiff’s
breach of contract claim even though the second suit was brought under a different
provision of the contract); Moody, 609 S.E.2d at 263(holding that the plaintiff was barred
by res judicata from filing a second suit where plaintiff could have amended his first
complaint to include additional causes of action based on facts that became apparent
during the first litigation).

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 McAdoo I was based on the same basic issues – McAdoo’s experience at and
relationship with the University as one of its student-athletes. McAdoo alleged that the
University breached its “contract” with him as a student-athlete. While he was
previously challenging the University’s reporting to the NCAA that he had committed
academic violations of the Honor Code as a student, he now wants to use the same
academic courses underlying the previous suit to allege educational malpractice, among
other claims. Moreover, as set forth in Section II above, McAdoo alleges that he was
“immediately aware” upon arriving on campus in 2008 that the University did not live up
to the promises it allegedly made during their recruitment. See Compl. ¶ 28; FAC ¶ 54.
He thus was aware of the facts constituting his claims here when he brought his prior suit
in 2011 and had every opportunity raise them then.
Finally, there can be no question that the parties in both McAdoo I and here are
the same. McAdoo’s prior lawsuit was against the University, among other parties, and
McAdoo directly asserted multiple claims against the University.
Plaintiff McAdoo cannot be allowed two bites at the apple concerning his claims
against the University arising out of his educational experience as a student-athlete.
McAdoo’s claims should be dismissed on res judicata grounds.
CONCLUSION
For the foregoing reasons, the University respectfully requests that all of
Plaintiffs’ claims against it be dismissed.
Respectfully submitted this 23rd day of April, 2015
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 /s/ Lisa Gilford
Lisa Gilford
Skadden, Arps, Slate, Meagher & Flom,
LLP
300 South Grand Ave.
Suite 3400
Los Angeles, CA 90071
(213) 687-5130
E: lisa.gilford@skadden.com

ROY COOPER
Attorney General
/s/ Stephanie Brennan
Stephanie Brennan
Special Deputy Attorney General
NC State Bar No. 35955
E: sbrennan@ncdoj.gov
North Carolina Department of Justice
PO Box 627
Raleigh, NC 27602-0627
(919) 716-6920
Attorneys for Defendant The University
of North Carolina at Chapel Hill

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Case 1:14-cv-00935-LCB-JLW Document 15 Filed 04/23/15 Page 36 of 38

 CERTIFICATE OF SERVICE
I hereby certify that on April 23, 2015, I electronically filed the foregoing
MEMORANDUM OF LAW IN SUPPORT OF MOTION TO DISMISS with the Clerk
of Court using the CM/ECF system, which will send notification of such filing to the
following:

Geraldine Sumter
N.C. State Bar No: 11107
FERGUSON, CHAMBERS & SUMTER, P.A.
309 E. Morehead Street, Suite 110
Charlotte, North Carolina 28202
Telephone: 704-375-8461
Facsimile: 980-938-4867

Cyrus Merhi
Steve Skalet
N. Jeremi Duru
Craig Briskin
Danielle Davis
MEHRI & SKALET, PLLC
1250 Connecticut Avenue, NW
Suite 300
Washington, D.C. 20036
Telephone: (202) 822-5100

Attorneys for Plaintiffs
This 23rd day of April, 2015.

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Case 1:14-cv-00935-LCB-JLW Document 15 Filed 04/23/15 Page 37 of 38

 /s/ Lisa Gilford
Lisa Gilford
Skadden, Arps, Slate, Meagher & Flom, LLP
300 South Grand Ave. Suite 3400
Los Angeles, CA 90071
(213) 687-5130
E: lisa.gilford@skadden.com
Attorney for Defendant The University of North Carolina at Chapel Hill

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