Burnett, Schaeffer and Hembree may have engaged in improper and unlawful actions with Kentucky Central assets and may have had interests that were adverse to Kentucky Central agents . . . ."
Kentucky Central claims that this allegation is fatal because it is framed as a question rather than an assertion of fact. They claim that it is an open-ended, conditional allegation and is consequently meaningless and should be stricken. Their request must be denied, however, since the disputed language is part of a longer allegation that cites specific acts of misconduct by the board.
Kentucky Central also seeks to strike various other portions of the complaints on the grounds that they are contradicted by the evidentiary material supplementing the complaint. In each case the evidentiary materials do not directly contradict the claims and therefore there is no reason to strike the allegations at this time.
Finally, Kentucky Central seeks to strike the reference in Paragraph 1 of the Prayer for Relief in each complaint which states that "this action be maintained on behalf of the California general public". Defendant Kentucky Central claims that such a statement is inappropriate given the nature of these cases and the relief sought. Plaintiffs defend this language by citing to Sections 17204 and 17535 of the California Business and Professions Code which specifically provide that injunctive relief and restitution may be sought by any person acting for his own interest or the general public for the violation of California's unfair business practice laws.
Although there is no request for injunctive relief in this action, Plaintiffs have requested restitution for all the members of the public injured by the alleged fraud perpetrated by Kentucky Central. Plaintiffs have failed, however, to provide any specifics regarding which members of the general public are to be included in this action and what restitution is sought on their behalf. In addition, although the relief requested is termed restitution, Plaintiffs have not explained how it is to be distinguished from damages which are not recoverable under these sections. See Industrial Indem. Co. v. Santa Cruz County Superior Court, 257 Cal. Rptr. 655, 209 Cal. App. 3d 1093 (App. 6 Dist. 1981); Newport Components v. NEC Home Electronics, 671 F. Supp. 1525 (C.D. Cal. 1987).
Thus, this court will grant Plaintiff's motion to strike the reference to the general public under Rule 12(f) subject to repleading by Plaintiffs with more specificity to inform the court and the defendant what restitution is to be obtained on behalf of which members of the general public.
In light of the foregoing,
(1) the motion to dismiss the Individual Defendants for lack of personal jurisdiction will be granted with respect to Defendants Hembree, Surmick, Gunn, Sammartin, Preston, Schaeffer and Rampulla, but denied with respect to Defendant Burnett;
(2) Kentucky Central's motion to dismiss the RICO claims is granted on the grounds that those claims are barred by the McCarran-Ferguson Act;
(3) Kentucky Central's motion to dismiss state claims for misrepresentation and fraud is denied;
(4) Kentucky Central's motion to dismiss the libel claims is denied;
(5) Kentucky Central's motion to strike portions of the complaints is granted in part and denied in part.
IT IS SO ORDERED.
Dated: August 31, 1992
Robert F. Peckham
United States District Judge
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