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Boulton v. American Transfer Services, Inc.

United States District Court, S.D. California

May 5, 2015

AMERICAN TRANSFER SERVICES, INC., a Delaware corporation; RUBEN SANCHEZ, an individual; ANA GUERRA DURAN, an individual; and DOES 1-50, inclusive Defendants.


GONZALO P. CURIEL, District Judge.

Before the Court is Defendants' motion to dismiss the complaint for failure to state a claim. (Dkt. No. 3.) Plaintiff filed an opposition on April 24, 2015. (Dkt. No. 6.) Defendants filed a reply on April 30, 2015. (Dkt. No. 7.) Based on the reasoning below, the Court GRANTS Defendants' motion to dismiss with leave to amend.


On March 2, 2015, Plaintiff Kerry Boulton ("Plaintiff") filed a complaint[1] against Defendants American Transfer Services, Inc. ("ATS"), Ruben Sanchez ("Mr. Sanchez"), and his wife, Ana Guerra De Sanchez ("Mrs. Sanchez") alleging state law causes of action for fraud, conversion, violation of California Penal Code section 496, and money had and received. (Dkt. No. 1.)

Plaintiff is a resident of Melbourne, Australia. (Id. ¶ 2.) According to the complaint, in August 2013, Plaintiff attended a webinar about purchasing tax deeds and/or tax liens on real property situated in the United States. (Id. ¶ 14.) Defendants advertised their services to Plaintiff and "represented that ATS is an exclusive service provider capable of assisting foreign individuals with creating legal business entities for the purpose of investing in real property that is subject to tax liens and/or tax deeds within the United States." (Id.) Based on their representations, Plaintiff decided to allow Defendants to assist her with prospective investments. (Id.)

Around September 2013, Defendants informed Plaintiff that she needed to wire funds to a Bank of America account that was designated solely for incoming wire transfers. (Id. ¶ 15.) Defendants informed Plaintiff that once the funds were received, they would create a separate bank account and transfer the wired monies for the sole benefit of Plaintiff. (Id.) They provided Plaintiff with specific wiring instructions and she complied. (Id. ¶ 16.) Around October 2013, Plaintiff transferred $1, 000 to Defendants and Defendants confirmed receipt of the $1, 000 but failed to create a separate bank account. (Id.) They said they would "be providing a[n] account number and routing number for [Mrs. Boulton] shortly." (Id.)

Around November 2013, Plaintiff discovered real property located in the County of Miami-Dade in Florida that was subject to a tax deed and/or tax lien that she wished to purchase as an investment. (Id. ¶ 17.) She informed Defendants of her intention to purchase the property and they instructed her to wire the necessary funds to ATS. (Id.) She explained that she intended to transfer $155, 000 to ATS for the purpose of purchasing the real property located in Miami-Dade County, Florida and explained that $7, 500 was to be deposited with the Miami-Dade County Clerk of Court in order to allow her to participate in the purchasing of that property. (Id.) Defendants stated they understood Plaintiff's intentions as well as her specific instructions regarding the transferring of funds and provided her with wiring instructions to transfer $155, 000 to ATS. (Id. ¶ 18.) Plaintiff completed the wire transfer around November 18, 2013. (Id.) She confirmed delivery of the funds with Defendants and provided transfer instructions for the $7, 500 to be deposited with the Miami-Dade County Clerk of Court. (Id. ¶ 19.) However, the deposit was never made to the Miami-Dade County Clerk of Court. (Id. ¶ 20.) Several days after the $155, 000 wire transfer, Defendants produced a transfer receipt of $7, 500 from ATS to the Miami-Dade County Clerk of Court. (Id.) She later learned the transfer receipt was forged when she contacted the Miami-Dade County Clerk of Court and was informed there was no record of any money received from, or on behalf of, Plaintiff. (Id.)

Upon learning this, Plaintiff immediately contacted Defendants and demanded an explanation. (Id. ¶ 21.) However, Defendants terminated all communications with Plaintiff by refusing to respond to all attempts of correspondence. (Id.) She repeatedly demanded the return of her money but Defendants have refused to return the $156, 000 unlawfully obtained by Defendants from Plaintiff. (Id.)


A. Legal Standard as to Federal Rule of Civil Procedure 12(b)(6)

Federal Rule of Civil Procedure ("Rule") 12(b)(6) permits dismissal for "failure to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). Dismissal under Rule 12(b)(6) is appropriate where the complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory. See Balistreri v. Pacifica Police Dep't., 901 F.2d 696, 699 (9th Cir. 1990). Under Federal Rule of Civil Procedure 8(a)(2), the plaintiff is required only to set forth a "short and plain statement of the claim showing that the pleader is entitled to relief, " and "give the defendant fair notice of what the... claim is and the grounds upon which it rests." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).

A complaint may survive a motion to dismiss only if, taking all well-pleaded factual allegations as true, it contains enough facts to "state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. "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. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) (quotations omitted). In reviewing a Rule 12(b)(6) motion, the Court accepts as true all facts alleged in the complaint, and draws all reasonable inferences in favor of the plaintiff. al- Kidd v. Ashcroft, 580 F.3d 949, 956 (9th Cir. 2009).

Where a motion to dismiss is granted, "leave to amend should be granted unless the court determines that the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency.'" DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986)). In other words, where leave to amend ...

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