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Cohen v. Trump

United States District Court, S.D. California

February 21, 2014

ART COHEN, Individually and on Behalf of All Others Similarly Situated, Plaintiff,
v.
DONALD J. TRUMP, Defendant.

ORDER: 1. DENYING MOTION TO DISMISS [Dkt. No. 9.] 2. DENYING MOTION TO STRIKE [Dkt. No. 10.]

GONZALO P. CURIEL, District Judge.

Defendant Donald J. Trump ("Defendant") moves to dismiss Plaintiff Art Cohen's ("Plaintiff") putative class action Complaint on multiple grounds pursuant to Federal Rule of Civil Procedure 12(b)(6) or, in the alternative, to strike portions of the Complaint pursuant to Federal Rule of Civil Procedure 12(f). (Dkt. Nos. 9, 10.) The Parties have fully briefed both motions. (Dkt. Nos. 16-19.) Pursuant to Civil Local Rule 7.1(d)(1), the Court finds the matter suitable for adjudication without oral argument. Having considered the parties' submissions and the applicable law, the Court DENIES Defendant's motions.

BACKGROUND

I. Cohen's Allegations

Plaintiff, a resident of California, sues on behalf of himself and all others similarly situated. Defendant is a resident of the State of New York and was "a founder and Chairman, officer, director, managing member, principal and/or controlling shareholder of Trump University." (Dkt. No. 1, Compl. ¶ 5.)

Plaintiff alleges learning about Trump University from a 2009 San Jose Mercury News advertisement. (Compl. ¶ 4.) Plaintiff alleges receiving a "special invitation" by mail to attend a Trump University seminar. (Compl. ¶ 13.) Drawn in by Defendant's name and reputation, Plaintiff attended a free preview event. (Id.) Plaintiff then paid $1, 495 to Trump University to attend a real estate retreat, where he subsequently purchased a "Gold Elite" program for $34, 995. (Id.) Plaintiff alleges that, but for misrepresentations made by Trump University, he would not have paid for Trump University programs. (Compl. ¶ 14.) Specifically, Plaintiff alleges the following misrepresentations: that the programs would give access to Donald Trump's real estate investing secrets; that Donald Trump had a meaningful role in selecting the instructors for Trump University programs; and that Trump University was a "university." (Id.)

On October 18, 2013, Plaintiff filed a complaint in the above-captioned matter, alleging a single cause of action for mail and wire fraud in violation of the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. § 1962(c). Defendant now moves the Court for dismissal of the Complaint. (Dkt. No. 9.) In the alternative, Defendant moves the Court to strike portions of Plaintiff's Complaint. (Dkt. No. 10.)

II. Related Case, Makaeff v. Trump University LLC

On October 18, 2013, Plaintiff filed a "notice of related case" requesting that the above-captioned matter be transferred to the undersigned Judge because the present action is related to Makaeff v. Trump University LLC, Case No. 10-cv-940-GPC-WVG. Filed on April 30, 2010, the initial complaint in Makaeff alleged ten causes of action under state consumer protection statutes and common law. (Case No. 10-cv-940-GPC-WVG, Dkt. No. 1.) On October 7, 2013, the Court denied plaintiff Makaeff's motion to modify the scheduling order in that case to file a fourth amended complaint to include a RICO cause of action. ( Id., Dkt. No. 248.) On February 21, 2014 the Court granted plaintiff Makaeff's motion for class certification, certifying a class of plaintiffs defined as: "All persons who purchased a Trump University three-day live "Fulfillment" workshop and/or a "Elite" program ("Live Events") in California, New York and Florida, and have not received a full refund." ( Id., Dkt. No. 298 at 35.)

DISCUSSION

I. Requests for Judicial Notice

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); Fed.R.Civ.P. 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). Fed.R.Civ.P. 201(b).

A. Plaintiff's Declaration

In support of Plaintiff's opposition to Defendant's Motion to Dismiss, Plaintiff submits a declaration by attorney Jason A. Forge and an attached exhibit. Plaintiff fails to properly seek judicial notice of the exhibit under Federal Rule of Evidence 201. Accordingly, the Court declines to convert the present motion into a motion for summary judgment by accepting Plaintiff's declaration or exhibit in consideration of the present Motion to Dismiss. Lee , 250 F.3d at 688.

B. Defendant's Request for Judicial Notice

Defendant seeks judicial notice of two documents in support of his Motion to Dismiss the Complaint: (1) Plaintiff's evaluation of a Trump University training course; and (2) the ethics complaint filed by Trump against the New York Attorney General. (Dkt. No. 18-1 at 2.) The Court declines to take judicial notice of the filed documents, for two primary reasons. First, Defendant submits the request for judicial notice as part of Defendant's reply to Plaintiff's opposition to Defendant's motion. (Id.) As such, Plaintiff has had no opportunity to respond to the propriety of taking judicial notice of the documents. See U.S. v. Ritchie , 342 F.3d 903, 909 (9th Cir. 2003) ("[e]ven if the government's attached documents were properly the subject of judicial notice, [plaintiff] should have been given some opportunity to respond to the propriety of taking judicial notice of the facts alleged therein.") (citing Fed.R.Evid. 201(e)).

Second, the Court does not find the documents relevant to the present motion to dismiss. While the Court may take judicial notice of the fact that Plaintiff completed an evaluation or that Trump filed a complaint against the New York Attorney General, the Court may not take notice of disputed facts or the truth of the facts recited therein. Lee v. City of Los Angeles , 250 F.3d 668, 689-90 (9th Cir. 2001). The Court therefore finds the fact that Plaintiff completed an evaluation of a Trump University class and the fact that Trump filed an ethics complaint against one of the eleven Attorneys General referenced in the Complaint, (Compl. ¶¶ 7, 50, 52), irrelevant to whether the Complaint has properly alleged a cause of action under RICO, 18 U.S.C. § 1962(c). Accordingly, Defendant's two requests for judicial notice are DENIED.

II. Motion to Dismiss

A. Legal Standard

A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint. Navarro v. Block , 250 F.3d 729, 732 (9th Cir. 2001). "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above ...


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