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BANK ONE v. MAISEL

February 17, 2004.

BANK ONE, DEARBORN, N.A., Plaintiff
v.
DONALD B. MAISEL, Defendant



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, BACKGROUND*fn1

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 Page 2 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 Deck" cards.

  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 Page 3 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 Page 4 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 plus interest.

 LEGAL STANDARD

  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 Page 5 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 (1991).

  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 ...


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