The opinion of the court was delivered by: MARILYN PATEL, Chief Judge, District
MEMORANDUM & ORDER RE SUMMARY JUDGMENT
Plaintiff Bank One brings this action against defendant Donald B.
Maisel seeking restitution for monies mistakenly paid by Bank One's
predecessor-in-interest on an unauthorized check. Now before the court is
plaintiff's motion for summary judgment. After having considered the
parties' arguments and submissions, and for the reasons set forth below,
the court rules as follows,
Maisel, an emergency room physician in Santa Clara County, collects
baseball cards as a hobby. At the time of the events central to this
action, Maisel was especially interested in Ken Griffey, Jr. cards.
Weickhardt Dec., Exh. 1 at 4. In September 1999, Maisel won an eBay
auction for a Ken Griffey, Jr. rookie `Upper Deck" card in the amount of
$1737.99. Because Maisel had been defrauded in an earlier eBay
transaction, he was initially wary of sending a check to the seller, John
Collins. Id. at 3. A phone conversation with Collins, who claimed to be
the owner of a successful medical arbitration company called John Charles
& Associates, reassured Maisel that Collins was legitimate, Id. at 4.
Maisel sent Collins the money on September 13, 1999. Knowing of
Maisel's interest in Ken Griffey, Jr. cards, Collins offered to sell
Maisel additional cards. On September 14, Maisel sent Collins a check for
$3476 for two more rookie cards, and three days later, Maisel sent
another check for $958 for 400 Ken Griffey, Jr. 1990 and 1991 "Upper
Through these transactions and many others, Maisel and Collins became
friends. Id. They ultimately agreed to form the "High Grade Card
Company," a business in which Collins would buy cards and Maisel would
sell them, and the two would split the profits. Collins claimed to
purchase several collections for the company, including one for $3000 that
had a 1951 Mickey Mantle "Bowman" rookie card with an estimated value of
$50,000 to $100,000. In early October, Collins told Maisel of an
"incredible deal" an heir to a tobacco. family planned to sell 20,000
packages of tobacco, each one unopened with a baseball card inside.
Collins asked Maisel for half the purchase price, or $88,000.
Maisel, however, had begun to distrust Collins. After a month of
excuses, Maisel still had not received the Ken Griffey, Jr. cards he had
purchased from Collins. Moreover, Maisel had received only two boxes of
the promised collections that did not include the valuable Mickey Mantle
card. On October 14, after calling Collins in the morning to warn him of
his arrival that afternoon, Maisel flew to Indiana to visit Collins at
his home. The visit reassured Maisel. Collins' stories about his life
appeared to be true he lived in a large house with a swimming pool and a
tennis/basketball court and Maisel saw numerous boxes of baseball cards
from Collins' own collection. Before leaving, Maisel wrote Collins two
checks for a total of $115,000, which included payment for Maisel's share
of the collections bought by Collins and $4400 for future expenditures.
In December, Collins called Maisel "almost in tears" and claimed that
the IRS had frozen his bank accounts because John Charles & Associates
owed back taxes. Id. at 10. Collins claimed that a former employee had
stolen the money. Id. On December 13, Maisel sent Collins a $20,000
loan, which Collins promised to repay in six weeks. A month later,
Collins claimed the IRS was still after him and he needed more money. He
offered to sell Maisel and Maisel's brother his entire collection of
one-million baseball cards. Maisel, though increasingly suspicious,
decided to purchase them because he had seen the boxes of cards in
Collins' house. Id. at 13. Collins sent three boxes to
Maisel as a sample. Id. On January 25, 2000, Maisel's brother sent
$50,000 to Collins, and Collins agreed that Maisel's share would come
from the money Maisel had already paid. After a series of excuses,
Collins finally sent seven boxes of the card collection to Maisel in
March; the cards were "essentially worthless" and not representative of
the cards Maisel had seen at Collins' house. Id. at 15.
By this time, Maisel still had not received any of the other cards
promised by Collins. Fearing that he might lose his money, Maisel hired
the Rat Dog Dick Detective Agency to check on Collins. The agency found
several small claims judgments against Collins but no real property
associated with his name, Collins' company, John Charles & Associates,
had been dissolved as of September 1997. The agency's report showed that
Collins had no record of criminal activity but that there were two social
security numbers affiliated with the name: one for a "John E. Collins"
and another for a "John C. Collins." Both names had the same date of
birth and the same address.
On April 5, Maisel sent Collins five separate letters demanding a
refund of $214,172: $5,214 for the three Ken Griffey, Jr. rookie cards,
$958 for the four hundred 1990 and 1991 Ken Griffey Jr. cards, $100,000
for Collins' collection, $88,000 for Maisel's share of the tobacco.
cards, and $20,000 for the loan.*fn2 Maisel also filed a complaint with
the joint FBI-Santa Clara Police Internet Task Force, which ultimately
transferred the file to the FBI office in Concord after deciding that the
case did not have a sufficient connection to the internet. In his
complaint, Maisel identified Collins as a "clever con man." Id at 18. At
the same time, Maisel began to "play the FBI card" with Collins. He led
Collins to believe that the FBI's investigation would result in criminal
prosecution, unless Collins returned $200,000 to Maisel. The tactic
worked. Collins told Maisel he would reimburse him from the sale of his
card collection to a friend named Johnnie Thomas, who lived in Decatur,
Georgia. Thomas would send $200,000 to Maisel directly, and the rest of
the proceeds would go to Collins.
On June 12, Collins faxed Maisel a copy of an unsigned check made
payable to Don Maisel, on the account of the Birmingham-Bloomfield Land
Title Company ("BBLT") at the National Bank of Detroit, Dearborn. Maisel
called BBLT that day to ask if the check was "good." BBLT referred
him to the National Bank of Detroit, Bank One's predecessor-in-interest,
which told him that the account had sufficient funds to pay the check.
The next day, Maisel received a check on the same account, purportedly
sent by Thomas. Although Collins had said "H. Angel" would sign the
check, the signature on the check was "V. Dantez." Moreover, the number
on the check was different than the one on the faxed copy. Maisel's wife
endorsed the check and deposited it in Maisel's account at Bank of
America. Bank of America placed a hold on the funds, but released them a
few days later. Using an automated system, Bank One processed the check
and posted it to the BBLT account.
Maisel sent his brother $50,000 and returned the rest of the money to
his savings and investment accounts. On June 22, Maisel sent Collins an
agreement concluding their business activities and stating that the
$200,000 was a "full refund" for monies owed. Weickhardt Dec., Exh. 2 at
72-73. Maisel reserved his rights to half of two collections and promised
to return the cards Collins sent as a sample of his collection.*fn3 Id.
at 73. In addition, Maisel purported to withdraw "any and all previous
legal claims." Id at 72. On August 9, Maisel sent Collins a final
agreement that transferred ownership of the card company to Maisel.
Collins signed both agreements.
In October, BBLT sent Bank One a forgery questionnaire affirming that
the check made payable to Maisel did not have an authorized signature.
Hartley Dec., Exh. 1 at 2. According to the questionnaire, BBLT first
discovered that the check was forged on June 21, 2000.*fn4 Id Bank One
credited BBLT's account, incurring a loss of $200,000. In November, Bank
One contacted Maisel to inform him that the check was counterfeit. Maisel
then contacted Collins, who denied any knowledge of forgery. On June 25,
2001, Bank One sent Maisel a letter demanding repayment of the $200,000
Summary judgment is proper when the pleadings, discovery and affidavits
show that there is "no genuine issue as to any material fact and that the
moving party is entitled to judgment as a matter of law." Fed.R.Civ.P.
56(c). Material facts are those which may affect the outcome of the
case. Anderson v. Liberty Lobby. Inc. 477 U.S. 242, 248 (1986). A dispute
as to a material fact is genuine if there is sufficient evidence for a
reasonable jury to return a verdict for the nonmoving
party. Id. The moving party for summary judgment bears the burden of
identifying those portions of the pleadings, discovery and affidavits
that demonstrate the absence of a genuine issue of material fact Celotex
Corp. v. Cattrett, 477 U.S. 317, 323 (1986V On an issue for which the
opposing party will have the burden of proof at trial, the moving party
need only point out "that there is an absence of evidence to support the
nonmoving party's case." Id
Once the moving party meets its initial burden, the nonmoving party
must go beyond the pleadings and, by its own affidavits or discovery,
"set forth specific facts showing that there is a genuine issue for
trial." Fed.R.Civ.P. 56(e), Mere allegations or denials do not defeat a
moving party's allegations, Id; see also Gasaway v. Northwestern Mut. Life
Ins. Co. 26 F.3d 957, 960 (9th Cir. 1994). Inferences to be drawn from
the facts must be viewed in the light most favorable to the party
opposing the motion. Masson v. New Yorker Magazine, 501 U.S. 496, 520
The court applies California substantive law to this diversity action.
All but one of the claims at issue in this motion concern Uniform
Commercial Code ("U.C.C.") provisions, codified in the California
Commercial Code. The court first looks to California decisions
interpreting these provisions. If there are no applicable decisions, the
court looks to other state courts that have interpreted Identical
provisions. California courts generally "afford great deference to the
decisions of sister ...