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I-ENTERPRISE CO. LLC v. DRAPER FISHER JURVETSON MGMT. CO.

November 3, 2005.

I-ENTERPRISE COMPANY LLC, Plaintiffs,
v.
DRAPER FISHER JURVETSON MANAGEMENT COMPANY V, LLC, et al., Defendants.



The opinion of the court was delivered by: MAXINE CHESNEY, District Judge

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION FOR PARTIAL DISMISSAL OF FOURTH AMENDED COMPLAINT; VACATING HEARING
Before the Court is defendants' motion, filed September 26, 2005, for partial dismissal of plaintiff I-Enterprise Company LLC's ("I-Enterprise") Fourth Amended Complaint, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. I-Enterprise has filed opposition to the motion, to which defendants have replied. Having considered the papers submitted in support of and in opposition to the motion, the Court finds the matter appropriate for decision without oral argument, see Civil L.R. 7-1(b), and hereby VACATES the November 4, 2005 hearing. For the reasons set forth below, the motion is GRANTED in part and DENIED in part.

BACKGROUND

  In 1998 and 1999, I-Enterprise, through its predecessors-in-interest, invested in two venture capital funds, Draper Fisher Jurvetson Fund V L.P. ("Fund V") and Draper Fisher Jurvetson Fund VI L.P. ("Fund VI") (collectively, "the Funds"). (See Fourth Amended Complaint ("4AC") ¶¶ 1, 4.) I-Enterprise alleges that it has suffered more than $40 million in damages as a result of defendants' fraudulent and negligent misrepresentations, breach of contract, breach of fiduciary duty, state securities law violations, unfair business practices, conversion, and unjust enrichment. (See id. ¶¶ 1, 3.)

  Defendant Draper Fisher Jurvetson Management Company V, LLC ("DFJ-V") is the general partner of Fund V. (See id. ¶ 5.) Defendant Draper Fisher Jurvetson Management Company VI, LLC ("DFJ-VI") is the general partner of Fund VI. (See id. ¶ 6.) Defendants Timothy C. Draper ("Draper"), John H.N. Fisher ("Fisher"), and Stephen T. Jurvetson ("Jurvetson") (collectively, "individual defendants") are managing directors of DFJ-V and DFJ-VI. (See id. ¶¶ 7-9.) The individual defendants are also general partners in the Draper Fisher Jurvetson general partnership ("DFJ"). (See id.)

  LEGAL STANDARD

  A motion to dismiss under Rule 12(b)(6) cannot be granted unless "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." See Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Dismissal can be based on the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory. See Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990).

  Generally, a district court, in ruling on a Rule 12(b)(6) motion, may not consider any material beyond the pleadings. See Hal Roach Studios, Inc. v. Richard Feiner And Co., Inc., 896 F.2d 1542, 1555 n. 19 (9th Cir. 1990). Material that is properly submitted as part of the complaint, however, may be considered. See id. Documents whose contents are alleged in the complaint, and whose authenticity no party questions, but which are not physically attached to the pleading, also may be considered. See Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994). In addition, the Court may consider any document "the authenticity of which is not contested, and upon which the plaintiff's complaint necessarily relies," regardless of whether the document is referred to in the complaint. See Parrino v. FHP, Inc., 146 F.3d 699, 706 (9th Cir. 1998). Finally, the Court may consider matters that are subject to judicial notice. See Mack v. South Bay Beer Distributors, Inc., 798 F.2d 1279, 1282 (9th Cir. 1986).

  In analyzing a motion to dismiss, the Court must accept as true all material allegations in the complaint, and construe them in the light most favorable to the nonmoving party. See NL Industries, Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir. 1986). The Court may disregard factual allegations if such allegations are contradicted by the facts established by reference to exhibits attached to the complaint. See Durning v. First Boston Corp., 815 F.2d 1265, 1267 (9th Cir. 1987). Conclusory allegations, unsupported by the facts alleged, need not be accepted as true. See Holden v. Hagopian, 978 F.2d 1115, 1121 (9th Cir. 1992).

  DISCUSSION

  A. Conversion Claim

  I-Enterprise, in its opposition, notes that the Court previously has dismissed I-Enterprise's claim for conversion against DFJ-V, and states it has realleged the claim in the Fourth Amended Complaint solely to preserve the issue for appeal.

  Accordingly, as I-Enterprise is no longer asserting a conversion claim, defendants' motion to dismiss the conversion claim will be DENIED as moot.

  B. Unjust Enrichment

  Defendants move to dismiss I-Enterprise's unjust enrichment claims, on the ground the Court previously dismissed those claims as ...


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