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Andrew W. Shalaby v. Bernzomatic

March 9, 2012

ANDREW W. SHALABY
PLAINTIFF,
v.
BERNZOMATIC, AN UNINCORPORATED DIVISION OF IRWIN INDUSTRIAL TOOL SUPPLEMENTAL COMPANY; IRWIN INDUSTRIAL TOOL COMPANY; NEWELL
COMPANY, INC., AND DOES 1 THROUGH 50, INCLUSIVE;
DEFENDANTS.



The opinion of the court was delivered by: Hon. Anthony J. Battaglia U.S. District Judge

ORDER GRANTING MOTION TO DISMISS; DENYING EX PARTE APPLICATIONTO FILE COMPLAINT; AND DENYING REQUESTS FOR OPERATING JUDICIAL NOTICE [Doc. Nos. 36, 41, 43 and 45]

Defendants' filed a motion to dismiss, [Doc. No. 36], the Plaintiff's Second Amended Complaint ("SAC") for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6) and also argues that the Plaintiff's claims are barred by the statute of limitations. The Plaintiff filed an opposition to Defendants' motion to dismiss, [Doc. No. 37], and subsequently filed a request for judicial notice on January 25, 2012, [Doc. No. 41]. The Defendants filed a reply, [Doc. No. 38], and an objection to the Plaintiff's request for judicial notice, [Doc. No. 42].

On February 23, 2012, the Plaintiff filed an ex parte application for leave to file a supplemental complaint, [Doc. No. 43], and on March 1, 2012, a request for judicial notice in support of the ex parte application, [Doc. No. 45]. On February 24, 2012, the Defendants' filed a response to the ex parte application, [Doc. No. 44], and a response in opposition to the request for judicial notice, [Doc. No. 46].

The hearing on the motion to dismiss set for March 9, 2012 is hereby vacated as the Court finds this motion appropriate for submission on the papers without oral argument pursuant to Civil Local Rule 7.1.d.1. For the reasons set forth below, the Defendants' motion to dismiss, [Doc. No. 36], is GRANTED and the Plaintiff's ex parte application for leave to file a supplemental complaint, [Doc. No. 43], and request for judicial notice in support of the ex parte application, [Doc. No. 45], are DENIED. Factual Background

Andrew Shalaby ("Plaintiff") purchased a hand-held gas-powered torch from Home Depot produced by Bernzomatic, et al. ("Defendants"). Plaintiff alleged he sustained injuries on April 21, 2006 due to a torch malfunction. On October 10, 2006, Plaintiff filed a diversity products liability case under California law against Defendants in the Alameda County Superior Court. The action was removed to the Northern District of California and transferred to the Southern District of California, Case No. 07cv2107 MMA (BLM) ("Prior Federal Action"). The Honorable Michael M. Anello granted Defendants' motion for summary judgment on July 28, 2009. The Ninth Circuit Court of Appeals affirmed the district court's decision and issued an opinion on May 17, 2010. See Shalaby v. Newell Rubbermaid, Inc., 379 Fed. Appx. 620 (9th Cir. 2010); [FAC ¶ 3]. The Supreme Court denied Plaintiff's Petition for Writ of Certiorari on November 1, 2010. [FAC ¶ 3].

Plaintiff, an attorney licensed by the state of California, initiated this law suit, pro se, on January 12, 2011. He filed the FAC a day later on January 13, 2011. [Doc. No. 3]. Plaintiff alleged five causes of action against Bernzomatic: (1) Declaratory Relief; (2) Fraud; (3) Intentional Tort; (4) Negligence; and (5) Injunctive Relief. On February 4, 2011, Defendants filed a motion to dismiss for failure to state a claim, which was subsequently granted on September 9, 2011. At that time, all of Plaintiff's claims were dismissed with prejudice, except for Plaintiff's general theory of fraud and request for injunctive relief, which were dismissed without prejudice. Plaintiff filed a SAC on October 8, 2011, which further alleges a claim under a general theory of fraud and seeks injunctive relief. Plaintiff also pleads a cause of action for fraud and unfair business practices. Defendants filed the instant motion to dismiss SAC on October 18, 2011.

Legal Standard

Motion to Dismiss

A motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure, tests the legal sufficiency of the pleadings, and allows a court to dismiss a complaint upon a finding that the plaintiff has failed to state a claim upon which relief may be granted. See Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). The court may dismiss a complaint as a matter of law for: (1) "lack of cognizable legal theory," or (2) "insufficient facts under a cognizable legal claim." SmileCare Dental Grp. v. Delta Dental Plan of Cal., 88 F.3d 780, 783 (9th Cir. 1996) (citation omitted). However, a complaint survives a motion to dismiss if it contains "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

Notwithstanding this deference, the reviewing court need not accept "legal conclusions" as true. Ashcroft v. Iqbal, -- U.S. -- , 129 S. Ct. 1937, 1949--50, 173 L.Ed.2d 868 (2009). It is also improper for the court to assume "the [plaintiff] can prove facts that [he or she] has not alleged." Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 519, 526 (1983). On the other hand, "[w]hen there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Iqbal, 129 S. Ct. at 1929. The court only reviews the contents of the complaint, accepting all factual allegations as true, and drawing all reasonable inferences in favor of the nonmoving party. al-Kidd v. Ashcroft, 580 F.3d 949, 956 (9th Cir. 2009) (citations omitted).

Leave to Amend

Rule 15(a) of the Federal Rules of Civil Procedure declares that the "court should freely give leave when justice so requires." Fed. R. Civ. P. 15(a). If the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claims on the merits. Foman v. Davis, 371 U.S. 178, 182 (1962). Although there is a general rule that parties are allowed to amend their pleadings, it does not extend to cases in which any amendment would be an exercise in futility or where the amended complaint would also be subject to dismissal. Pisciotta v. Teledyne Industries, Inc., 91 F.3d 1326, 1331 (9th Cir. 1996); Saul v. United States, 928 F.2d 829, 843 (9th Cir. 1991). Dismissal without leave to amend is proper if it is clear that the complaint could not be saved by amendment. Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003) (per curiam).

Federal Rule of Civil Procedure Rule 9(b)

Fraud claims must be plead to satisfy the particularity requirements of Rule 9(b) of the Federal Rule of Civil Procedure . A claim of fraud must have the following elements: "(a) a misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or 'scienter'); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage." In re Estate of, 160 Cal. App. 4th 62, 79 (2008) (quoting Lazar v. Superior Court, 12 Cal. 4th 631, 638 (1996) (internal quotation marks omitted)). Rule 9(b) requires that each of these elements be pleaded with particularity. The Ninth Circuit has "interpreted Rule 9(b) to mean that the pleader must state the time, place and specific content of the false representations as well as the identities of the parties to the misrepresentation." Alan Neuman Prods., Inc. v. Albright, 862 F.2d 1388, 1392-93 (9th Cir. 1988). Averments of fraud must be accompanied by the "who, what, when, where, and how" of the misconduct charged. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (citation omitted). Additionally, "the plaintiff must plead facts explaining why the statement was false when it was made." Smith v. Allstate Ins. Co., 160 F. Supp. 2d 1150, 1152 (S.D. Cal. 2001) (citation omitted); see In re GlenFed, Inc. Sec. Litig., 42 F.3d 1541, 1549 (9th Cir. 1994) (en banc) (superseded by statute on other grounds).

Discussion

Presently before the Court are: 1) several requests for judicial notice; 2) the Defendants' motion to dismiss the SAC; and 3) the Plaintiff's ex parte application for leave to file a supplemental complaint.

Requests for Judicial Notice

Under Federal Rule of Evidence ("FRE") Rule 201, a court may take judicial notice of adjudicative facts "not subject to reasonable dispute." Fed. R. Evid. 201(b). Facts are indisputable, and thus subject to judicial notice, only if they are either "generally known" under Rule 201(b)(1) or "capable of accurate and ready determination by resort to sources whose accuracy cannot be reasonably questioned" under Rule 201(b)(2). Taking judicial notice of findings of fact from another case exceeds the limits of Rule 201 . See M/V Am. Queen v. San Diego Marine Constr. Corp., 708 F.2d 1483, 1491 (9th Cir.1983).*fn1 Under FRE 201(c), the Court must take notice if requested by a party and if supplied with the necessary information.

A. Defendants' Request for Judicial Notice

Defendants have filed two requests for judicial notice. The first request for judicial notice, [Doc. No. 36-3], requests judicial notice of: (1) the First Amended Complaint in the Prior Federal Action; and (2) the Material Safety Data Sheet ("MSDS"). Defendants' second request for judicial notice, [Doc. No. 38-1], requests judicial notice of: 1) pleadings filed in Prior Federal Action; 2) Order denying Plaintiff's motion in Prior Federal Action [Doc. No. 131]; 3) Motion to File [Proposed] Second Amended Complaint [Doc. No. 98]; and (4) Order denying Plaintiff's Motion for Leave to File a Second Amended Complaint in the Prior Federal Action [Doc. No. 204].

Generally, a court may not consider material beyond the complaint in ruling on a Fed. R. Civ. P. 12(b)(6) motion. Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001). However, "[a] court may take judicial notice of 'matters of public record' without converting a motion to dismiss into a motion for summary judgment," as long as the facts noticed are not "subject to reasonable dispute." Intri-Plex Technologies, Inc. v. Crest Group Inc., 499 F.3d 1048, 1052 (9th Cir. 2007) (quoting Lee, 250 F.3d at 689). The Plaintiff has not opposed Defendants' request or disputed the authenticity of these documents. Accordingly, the Court hereby GRANTS Defendants' request for judicial notice of the documents in the Prior Federal Action, the subsequent Appeal, and records related to the state court action pursuant to Rule 201 of the Federal Rules of Evidence as needed to resolve the pending motions. Generally, a court may not consider material beyond the complaint in ruling on a Fed. R. Civ. P. 12(b)(6) motion. Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001). However, "[a] court may take judicial notice of 'matters of public record' without converting a motion to dismiss into a motion for summary judgment," as long as the facts noticed are not "subject to reasonable dispute." Intri-Plex Technologies, Inc. v. Crest Group Inc., 499 F.3d 1048, 1052 (9th Cir. 2007) (quoting Lee, 250 F.3d at 689). The Plaintiff has not opposed Defendants' request or disputed the authenticity of these documents. Accordingly, the Court hereby GRANTS Defendants' request for judicial notice of the Material Safety Data Sheet ("MSDS"), the documents in the Prior Federal Action, the subsequent Appeal, and records related to the state court action pursuant to Rule 201 of the Federal Rules of Evidence as needed to resolve the pending motions.

B. Plaintiff's Requests for Judicial Notice

Plaintiff also filed two requests for judicial notice. Plaintiff's first request for judicial notice, [Doc. No. 41], requests judicial notice of (1) Defendants' recall notice, dated January 17, 2012, relating to all MAPP gas cylinders produced through January 15, 2012; (2) Judgment Bernzomatic obtained against Worthington Industries; (3) Report in the Columbus Business First, dated July 5, 2011, disclosing Worthington Cylinder's purchase of Bernzomatic for $51 million. Defendants oppose Plaintiff's request for judicial notice, arguing Plaintiff's theories with regard to the documents he presents to the court are irrelevant. Defendants argue that Plaintiff's "theories on the import of the recall have no relevance to whether the SAC has properly alleged causes of action for fraud and violations of the Unfair Competition Law." (Doc. No. 42, p. 2:11-13 ). The court finds ...


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