United States District Court, S.D. California
DENYING LEAVE TO AMEND AS FUTILE; AND (2) GRANTING DEFENDANT'S MOTION TO DISMISS
PLAINTIFFS' SECOND AMENDED COMPLAINT (DOC. 42, 47)
CYNTHIA BASHANT, District Judge.
On August 26, 2013, Plaintiffs Tricia Varrasso, Donald Varrasso, and Harold Will filed a Complaint claiming damages against Defendants Sun West Solar, Inc. et al. for defrauding Plaintiffs. Doc. 1. Plaintiffs then amended their complaint on September 9, 2013. Soon afterward, Defendants filed separately noticed motions to dismiss the complaint. Then, on October 22, 2013, Plaintiffs filed a motion for leave to amend the complaint. Doc. 20. The court granted their request. Plaintiffs therefore filed their Second Amended Complaint on January 14, 2014. Then, less than two weeks later and the day before motions to dismiss were due, Plaintiffs again moved for leave to amend their complaint. Doc. 42. The next day, five separately-noticed motions to dismiss from various defendants were filed.
Plaintiffs Tricia Varrasso, Donald Varrasso, and Harold Will loaned money to Defendant Sun West Solar, Inc. The initial loan, termed a "guaranteed good deal, " totalled $645, 000 and was secured with stock in Sun West and a property interest in the "Texan Resort, " a property purportedly owned by Defendant. Second Am. Comp. ¶ 129.
Plaintiff was allegedly induced to loan Sun West an additional $155, 000, but that transaction is not challenged in the Complaint. Proposed Third Am. Compl. ¶ 2. Plaintiffs claim that Defendants are involved in a racket. Second Am. Compl. ¶¶ 210-211.
II. PLAINTIFFS' MOTION TO AMEND
Rule 15(a) of the Federal Rules of Civil Procedure provides that after a responsive pleading has been served, a party may amend its complaint only with the opposing party's written consent or the court's leave. Fed.R.Civ.P. 15(a). "The court should freely give leave when justice so requires, " and apply this policy with "extreme liberality." Id .; DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 186 (9th Cir. 1987). However, leave to amend is not to be granted automatically. Zivkovic v. S. Cal. Edison Co., 302 F.3d 1080, 1087 (9th Cir. 2002) (citing Jackson v. Bank of Hawaii, 902 F.2d 1385, 1387 (9th Cir. 1990)). Granting leave to amend rests in the sound discretion of the district court. Pisciotta v. Teledyne Indus., Inc., 91 F.3d 1326, 1331 (9th Cir. 1996).
The Court considers five factors in assessing a motion for leave to amend: (1) bad faith, (2) undue delay, (3) prejudice to the opposing party, (4) futility of the amendment, and (5) whether the plaintiff has previously amended the complaint. Johnson v. Buckley, 356 F.3d 1067, 1077 (9th Cir. 2004); see also Foman v. Davis, 371 U.S. 178, 182 (1962). The party opposing amendment bears the burden of showing any of the factors above. See DCD Programs, 833 F.2d at 186. Of these factors, prejudice to the opposing party carries the greatest weight. Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). However, absent prejudice, a strong showing of the other factors may support denying leave to amend. See id.
"Futility of amendment can, by itself, justify the denial of a motion for leave to amend." Bonin v. Calderon, 59 F.3d 815, 845 (9th Cir. 1995). Futility is a measure of the amendment's legal sufficiency. "[A] proposed amendment is futile only if no set of facts can be proved under the amendment... that would constitute a valid and sufficient claim or defense." Miller v. Rykoff-Sexton, Inc., 845 F.2d 209, 214 (9th Cir. 1988). Thus, the test of futility is identical to the one applied when considering challenges under Rule 12(b)(6) for failure to state a claim upon which relief may be granted. Baker v. P. Far E. Lines, Inc., 451 F.Supp. 84, 89 (N.D. Cal. 1978); see Saul v. United States, 928 F.2d 829, 843 (9th Cir. 1991) ("A district court does not err in denying leave to amend... where the amended complaint would be subject to dismissal." (citation omitted)).
Rule 8 of the Federal Rules of Civil Procedure requires each plaintiff to "plead a short and plain statement of the elements of his or her claim." Bautista v. Los Angeles Cnty., 216 F.3d 837, 849 (9th Cir.2000). Rule 8 requires each allegation to be "simple, concise, and direct." Fed.R.Civ.P. 8(d)(1). Where the allegations in a complaint are "argumentative, prolix, replete with redundancy and largely irrelevant, " the complaint is properly dismissed for failure to comply with Rule 8(a). McHenry v. Renne, 84 F.3d 1172, 1177-79 (9th Cir.1996); see also Nevijel v. N. Coast Life Ins. Co., 651 F.2d 671, 673-74 (9th Cir.1981) (affirming dismissal of complaint that was "verbose, confusing and almost entirely conclusory").
"A complaint that fails to comply with Rule 8 may be dismissed pursuant to Federal Rule of Civil Procedure 41(b)." Bravo v. Cnty. of San Diego, No. C 12-06460, 2014 WL 555195, at *2 (N.D.Cal. Feb.10, 2014)."The propriety of dismissal for failure to comply with Rule 8 does not depend on whether the complaint is wholly without merit." McHenry, 84 F.3d at 1179. "Even if the factual elements of the cause of action are present, but are scattered throughout the complaint and are not organized into a short and plain statement of the claim, ' dismissal for failure to satisfy Rule 8 is proper." Bravo, 2014 WL 555195, at *2 (citing McHenry, 84 F.3d at 1178). Accordingly, the court has discretion to deny motions for leave to amend if the proposed pleading fails to state a "short and plain statement" on which relief may be granted as "futile" under Rule 15(a).
Here, amendment is futile because the proposed pleading does not include a "short and plain statement, " but instead includes voluminous unnecessary materials failing to notify Defendants of the basis for the claims.
Plaintiffs begin the Proposed Third Amended Complaint claiming in an ambiguous and legally conclusory fashion that Defendant Sun West Solar, Inc. "bilk[ed] them out of their money through an elaborate scheme of fraudulent tricks, devices, schemes, and artifices." Prop. Third Am. Compl. ¶ 4. However, the proposed complaint fails to show, even though it proceeds for seventy-three pages, how the Plaintiffs individually or collectively relied on any defendants' promises. It is even unclear as to whether Plaintiffs have received any interest payments from Sun West Solar, Inc. or any other defendant. A proper complaint focuses on a simple and plain recitation of the relevant facts establishing a plausible claim for relief. This proposed complaint fails to properly allege such relief and therefore would not survive a motion to dismiss. The relevant facts necessary to properly plead may be included in the proposed complaint, but they are so buried in convoluted rhetoric and conjectural statements about the ...