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Liu v. Li

October 21, 2010



Present: The Honorable Otis D. Wright II, United States District Judge


Currently before the Court is Defendants, Paul R. Mata ("Mata") and Diana Yu's, ("Yu") (collectively, "Moving Defendants") Motion to Dismiss Pursuant to Rule 12(b)(6), or in the alternative, for a more definite statement pursuant to Rule 12(e). (Dkt. No. 18.) The Court finds the matters appropriate for decision without oral argument. Fed. R. Civ. P. 78; Local Rule 7-15. Having carefully considered the parties' arguments, Defendants' Motion is GRANTED in its entirety.


Plaintiffs, James Liu and Tsai Ping Liu (collectively, "Liu" or "Plaintiffs"), allege the following:

Defendants, Andrew "Xin Ping" Li ("Li") and Richard "Yong Hua" Zheng ("Zheng") agreed to assist Liu in transmitting one million dollars to China. Facing an investment deadline for a factory in China, Liu agreed to Li's representations that "everything would be done promptly and legally." Specifically, Li informed Liu that the one million dollars would be deposited into Li's New York New, Inc.'s ("NYN") account at a "bank." The amount in question would then be released to Liu's bank account in China. Li also stated that the bank would issue a "guarantee letter" stating that the bank will not release the one million dollars without Liu acknowledging that a deposit in the amount in question was made to Liu's Chinese bank account.

On January 10, 2007, Li and Liu met at an Ameriprise Financial Services, Inc. ("Ameriprise") location to implement their plans. At Ameriprise, Defendant, Diana Yu ("Yu"), an employee of Ameriprise, received two checks totaling one million dollars. Upon depositing the two checks to the NYN account, Yu represented that "a guarantee letter" would be issued in about 5

On January 19, 2007, Defendant, Paul R. Mata, an Ameriprise franchisee and Yu's employer, informed Liu by mail that the money had been deposited into an account in China. No guarantee letter however had been produced. Ultimately, Plaintiffs did not receive a deposit of the one million dollars in their bank account in China, and have not been successful in recuperating the deposited, $1,000,000, from Defendants.

Based on the foregoing, on or about May 21, 2010, Plaintiffs instituted this action in state court claiming: 1) Fraud; 2) Breach of Contract; 3) Breach of Covenant of Good Faith and Fair Dealing; 4) Conversion; 5) Unjust Enrichment; 6) Violation of the Unfair Business Act; 7) Violation of the Racketeer Influenced and Corrupt Organization Act ("RICO") under 18 U.S.C. section 1962(c); and 8) Violation of RICO under 18 U.S.C. section 1962(d). The case was removed on June 25, 2010 and assigned to this Court on July 29, 2010. Plaintiffs have since voluntarily dismissed Ameriprise from the case.


"To survive a motion to dismiss for failure to state a claim under Rule 12(b)(6), a complaint generally must satisfy only the minimal notice pleading requirements of Rule 8(a)(2)." Porter v. , 319 F.3d 483, 494 (9th Cir. 2003). Rule 8(a)(2) requires "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). For a complaint to sufficiently state a claim, its "[f]actual allegations must be enough to raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). Mere "labels and conclusions" or a "formulaic recitation of the elements of a cause of action will not do." Id. Rather, to overcome a 12(b)(6) motion, "a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Igbal, 129 S.Ct. 1937, 1949 (2009) (internal quotation marks omitted). "The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully. Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement of relief." Id. (internal citation and quotation marks omitted).

In ruling on a motion pursuant to Rule 12(b)(6), a court must construe the pleadings in a light most favorable to the plaintiff, and must accept as true all material allegations in the complaint, as well as any reasonable inferences to be drawn therefrom. See Broam v. Bogan, 320 F.3d 1023, 1028 (9th Cir. 2003); see also Chang v. Chen, 80 F.3d 1293 (9th Cir. 1996). A district court should ask "not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Twombly, 550 U.S. at 563. A court is not, however, "required to accept as true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences." Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001).

Thus, the Ninth Circuit has summarized the governing standard, in light of Twombly and , as follows: "In sum, for a complaint to survive a motion to dismiss, the non-conclusory factual content, and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. ...

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