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Natomas Gardens Investment Group, LLC v. Sinadinos

April 19, 2010

NATOMAS GARDENS INVESTMENT GROUP, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY, ORCHARD PARK DEVELOPMENT, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY, PLAINTIFFS,
v.
JOHN G. SINADINOS, STANLEY J. FOONDOS, STEPHEN FOONDOS, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Frank C. Damrell, Jr. United States District Judge

MEMORANDUM AND ORDER

This matter is before the court on defendant Larry Deane's ("Deane") motions to dismiss and specially strike plaintiff Natomas Gardens Investment Group, LLC's ("Natomas") counterclaim or, alternatively, for a more definite statement. (Docket #s 170, 183.) Natomas opposes the motions.*fn1 For the reasons set for forth below, Deane's motions are DENIED.

BACKGROUND

Natomas is a limited liability company operating in California. (Pl.'s Counterclaim ["Pl.'s CC"], filed July 28, 2009 [Docket #153], ¶ 2.) Natomas' membership includes, among others, Deane and Eric Solorio ("Solorio"), who is the manager of the company pursuant to the company's Operating Agreement. (Pl.'s CC ¶¶ 6, 9.) Natomas acquired purchase rights to several parcels of land. In order to purchase these properties, Natomas exchanged its purchase rights for a 45 percent stake in several development companies operated by the various defendants in this action.

Plaintiffs initially filed this action on September 29, 2008, alleging claims for RICO violations, RICO conspiracy, fraud, breach of fiduciary duty, legal and accounting malpractice, and conversion. (Pl.s' Second Amended Complaint ["SAC"], ¶¶ 192-251.) None of the claims arose from Natomas' Operating Agreement. Instead, Natomas, together with plaintiff, Orchard Park Development, LLC, alleged that the various defendants engaged in a complex scheme to defraud them through a sequence of property transfers, commingling of assets, and loans which were never intended to be repaid. (Id. ¶ 2-3.) Plaintiffs allege that through these actions, defendants operated a racketeering enterprise which "resulted in losses of plaintiffs' entire business opportunities, goodwill, prospective business opportunities, and monetary assets exceeding $3,000,000." (Id. ¶ 7.)

On October 20, 2008, Deane filed a lawsuit in California state court seeking dissolution of Natomas. (Deane's RJN re: MTD Pl.s' SAC, Ex. 1.) In that action, on January 27, 2009, Natomas filed a first amended cross-complaint against Deane which alleged claims for breach of contract, express and implied indemnity, comparative indemnity, and breach of fiduciary duty. (Deane's RJN re: MTD Pl.'s Counterclaim Ex. A.) These claims were expressly based on Natomas' Operating Agreement. On May 12, 2009, this court entered an order granting in part and denying in part various defendants', including Deane's, motions to dismiss plaintiffs' first amended complaint. (Docket # 123.)

On June 1, 2009, Deane filed a counter- and third-party claim against Natomas and Solorio, alleging individual claims for express indemnity, breach of contract, implied indemnity, and equitable indemnity, and derivative claims for breach of fiduciary duty, breach of contract and interference with prospective economic advantage. (Docket # 125.) These claims, like the claims proceeding before the state court, arose from Natomas' Operating Agreement.

On July 28, 2009, Natomas filed its answer to Deane's counterclaim which included its own counterclaim against Deane for breach of contract and breach of fiduciary duties; these claims were also partially the subject of Natomas' cross-complaint filed in state court. (Docket # 153.) It is this counterclaim filed by Natomas which is the subject of the present motions.

Meanwhile, on August 3, 2009, the state court stayed the state action pending the outcome of this federal lawsuit. (Pls.' RJN in Opp'n to Deane's MTD [Docket No. 211], Ex. C.)

On August 17, 2009, Deane filed the instant motion to dismiss Natomas' counterclaim on the grounds that it violated the pre-trial scheduling order as an amendment to plaintiffs' complaint without leave of court, and that it should be dismissed pursuant to the "Colorado River doctrine." (Docket # 170.) On September 25, 2009, Deane filed a separate motion to dismiss Natomas' counterclaim labeled as a motion to "specially strike" pursuant to California's anti-SLAPP statute.*fn2

ANALYSIS

Deane moves to dismiss Natomas' counterclaim on three distinct grounds. In Deane's motion to dismiss, he argues (1) Natomas' counterclaim is, in essence, an amendment to plaintiffs' complaint, and therefore is a violation of this court's pre-trial scheduling order which required leave of court to amend and (2) the counterclaim should be dismissed pursuant to Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 (1976) because duplicative judgments will result if Natomas is allowed to proceed with its counterclaim. In his motion to specially strike, Deane moves to dismiss Natomas' counterclaim pursuant to California's anti-SLAPP (Strategic Litigation Against Public Participation) statute, arguing plaintiff's counterclaim improperly seeks to chill his petition rights protected by the First Amendment. See Cal Civ. Code § 425.16.

I. Violation of Pre-trial Scheduling Order

Deane argues Natomas' counterclaim is an amendment of plaintiffs' complaint and, therefore, violates the court's pre-trial scheduling order limiting amendments. (Status (Pre-Trial Scheduling) Order, filed February 6, 2009 [Docket # 51].) ("No further joinder of parties or amendments to pleadings is permitted without leave of court, good cause having been shown.") Natomas argues, to the contrary, that its counterclaim raises mandatory counterclaims in response to Deane's ...


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