United States District Court, S.D. California
GRANTING DEFENDANT SOLUTIONS IQ, INC.'S MOTION TO DISMISS
[Doc. No. 19] (2) GRANTING DEFENDANT PILLSBURY WINTHROP SHAW
PITTMANN, LLP AND CHRISTIAN SALAMAN'S MOTION TO DISMISS
[Doc. No. 20] (3) GRANTING, IN PART, AND DENYING, IN PART,
DEFENDANT TIRRELL PAYTON'S MOTION TO DISMISS [Doc. No.
Marilyn L. Huff United States District Judge
February 23, 2017, Plaintiff Charbel Maksoud
(“Plaintiff”) filed a complaint asserting various
causes of action relating to Plaintiff's investment in BT
Software and Research, Inc. (Doc. No. 1.) On April 28, 2017,
Plaintiff filed a First Amended Complaint
(“FAC”). (Doc. No. 16.) The FAC contains nineteen
causes of action against eleven named defendants.
(Id.) On May 10, 2017, Defendant Solutions IQ, Inc.
filed a motion to dismiss the FAC for failure to state a
claim. (Doc. No. 19.) On May 10, 2017, Defendants Pillsbury
Winthrop Shaw Pittman, LLP and Christian Salaman filed a
motion to dismiss for failure to state a claim. (Doc. No.
20.) On May 12, 2017, Defendant Tirrell Payton filed a motion
to dismiss for failure to state a claim and failure to join
an indispensable party. (Doc. No. 22.) On May 22, 2017,
Plaintiff filed responses in opposition to defendants'
motions to dismiss. (Doc. Nos. 25-27.) On June 1, 2017,
Defendants Pillsbury Winthrop Shaw Pitman, LLP and Christian
Salaman filed a reply. (Doc. No. 29.) On June 2, 2017,
Defendant Solutions IQ, Inc. filed a reply. (Doc. No. 31.) On
June 5, 2017, Defendant Tirrell Payton filed a reply. (Doc.
facts are taken from Plaintiff's complaint. (Doc. No.
16.) During the relevant times, Plaintiff resided in Joplin,
Missouri. (Id. ¶ 14.) Through his neighbors,
Bruce and Schrell Hopkins (“the Hopkins”),
Plaintiff was introduced to Defendant Tirrell Payton
(“Payton”). Plaintiff was also introduced to
Defendant Philippe Guelton (“Guelton”) who owned
a marketing company, SheKnows Media, (id. ¶
15), and Defendant Paul Woodhull (“Woodhull”) and
Defendant Shawn Smith (“Smith”) who worked for
Momentum Marketing, (id. ¶ 16).
and the Hopkins were in the process of starting a company
named BT Software and Research, Inc. (“BT”).
(Id.) Following the incorporation of BT, Plaintiff
understood that Bruce Hopkins was the president and Payton
was the Chief Executive Officer. (Id. ¶14.)
Plaintiff also understood that Guelton was a principal of BT.
(Id. at 15.)
meeting defendants, Plaintiff alleges he was convinced to
invest $250, 000 in BT to help develop an application called
“Kaliki, ” intended to be a media platform.
(Id. ¶ 19.) Plaintiff was told that Kaliki
already had major contacts with automobile manufactures, as
well as media conglomerates. (Id. ¶ 20.) In
exchange for his $250, 000, Plaintiff was to receive an
upfront 2.5% equity interest in BT, which would mature to
7.5% after two years. (Id. ¶ 21.) This amount
was based on representations by Bruce Hopkins, Guelton, and
Payton that BT had a valuation of $10, 000, 000.
(Id. ¶ 21.) Bruce Hopkins and Payton also gave
Plaintiff a document showing that a company, AdLarge, had
invested additional monies in BT. (Id. ¶¶
24, 25.) In consummating his investment, Plaintiff signed a
Common Stock Purchase Agreement in May 2014. (Id.
the investment, Plaintiff worked to create relationships with
media companies in an attempt to market and advance Kaliki.
Plaintiff also recruited his now deceased brother-in-law,
Nadeem Baaklini, to develop a software search engine, OnSay.
(Id. ¶ 27.) Plaintiff claims Defendants
promised Baaklini would receive a 4% equity in BT and a
lifelong salary of $200, 000 per year for the development of
OnSay. (Id. ¶ 138.) After Baaklini died, the
OnSay project was near completion and Plaintiff is the
assignee of all of Baaklini's claims. (Id.
alleges that, following his investment, defendants failed to
complete their side of the bargain and misused his $250, 000.
Plaintiff alleges that, as part of his investment, he was to
receive his stock certificates but never did. Plaintiff
understood that Defendant Christian Salaman
(“Salaman”) and his law firm, Pillsbury Winthrop
Shaw Pittman, LLP (“Pillsbury”), were responsible
for drafting the documents but never did so. (Id.
¶ 23.) Plaintiff also claims that Payton and his wife,
Defendant Susan Payton, misappropriated money from BT and
used that money to further Payton's career with Solutions
IQ, Inc. (Id. ¶ 31.)
the date of his complaint, Plaintiff claims he never received
his shares of BT and BT was ultimately forfeited.
(Id. ¶¶ 6, 33.)
LEGAL STANDARD FOR MOTION TO DISMISS
motion to dismiss, pursuant to Federal Rule of Civil
Procedure 12(b)(6), tests the legal sufficiency of the
pleadings and allows a court to dismiss a complaint if the
plaintiff has failed to state a claim upon which relief can
be granted. Conservation Force v. Salazar, 646 F.3d
1240, 1241 (9th Cir. 2011). A complaint will survive 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). “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.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009). The pleadings must go
beyond “labels and conclusions” and the
“[f]actual allegations must be enough to raise a right
to relief above the speculative level.”
Twombly, 550 U.S. at 555. A “formulaic
recitation of the elements” is not enough.
Id.; accord Iqbal, 556 U.S. at 678
(“Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not
reviewing a motion to dismiss, a district court must accept
as true all facts alleged in the complaint, and draw all
reasonable inferences in favor of the plaintiff. Retail
Prop. Trust v. United Bhd. of Carpenters & Joiners of
Am., 768 F.3d 938, 945 (9th Cir. 2014). The court need
not, however, accept “legal conclusions” as true.
Iqbal, 556 U.S. at 678. Thus, pleadings unsupported
by factual allegations are not entitled to a presumption of
truth. Id. (“It is the conclusory nature of
respondent's allegations . . . that disentitles them to
the presumption of truth.”).
PLEADING STANDARD FOR FRAUD
alleging fraud or mistake, a party must state with
particularity the circumstances constituting fraud or
mistake.” Fed.R.Civ.P. 9(b). Federal courts apply this
standard regardless of whether the substantive law is state
or federal. Vess v. Ciba-Geigy Corp. USA, 317 F.3d
1097, 1103 (9th Cir. 2003). To satisfy the heightened
standard of Rule 9(b), the pleadings must be “specific
enough to give defendants notice of the particular misconduct
. . . so they can defend against the charge and not just deny
that they have done anything wrong.” Bly-Magee v.
California, 236 F.3d 1014, 1019 (9th Cir. 2001) (quoting
Neubronner v. Milken, 6 F.3d 666, 671 (9th Cir.
1993)). Put another way, the pleadings must provide
“‘the who, what, when, where, and how' of the
misconduct charged.” Vess, 317 F.3d at 1106
(quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th
heightened pleading standard of Rule 9(b) applies to all
claims “grounded in fraud” and may include claims
where fraud is not a required element. Id. at
1103-1104. “Where fraud is not an essential element of
a claim, only those allegations of the complaint which aver
fraud are subject to Rule 9(b)'s heightened pleading
standard.” Kearns v. Ford Motor Co., 567 F.3d
1120, 1124 (9th Cir. 2009). If the averment fails to meet the
heightened standard, then the Court should disregard the
fraud allegations and analyze the sufficiency of the claim
only as to the non-fraudulent conduct. Id.
SOLUTIONS IQ, INC.'S MOTION TO DISMISS
names Defendant Solutions IQ, Inc. (“Solutions”)
in four of his claims: (1) unjust enrichment, (Doc. No. 16 at
7), (2) restitution, (id. at 9), (3) constructive
trust (id. at 20), and (4) declaratory relief,
(id. at 25). Solutions argues that all of the claims
against it should be dismissed because Plaintiff has not met
his burden at the pleading stage. (Doc. No. 19-2 at 2.) The
Court agrees with Solutions.
has failed to offer sufficient facts to establish a plausible
claim against Solutions. Twombly, 550 U.S. at 570.
The FAC provides only one allegation of wrongdoing against
Solutions: that Solutions “knowingly and/or negligently
accepted funds from [Defendant] Tirrell.” (Doc. No. 16
¶ 31.) This bare assertion, based solely on
Plaintiff's information and belief, is precisely the type
of legal conclusion that is not entitled to a presumption of
truth. Iqbal, 556 U.S. at 678. And because the FAC
provides no other facts to support Plaintiff's claims
against Solutions, it does not provide “fair notice of
what [Plaintiff's] claim is and the grounds upon which it
rests. Conley v. Gibson, 355 U.S. 41, 47 (1957). As
such, the Court grants Solutions' motion to
dismissing a complaint, “leave to amend should be
granted unless the district court determines the pleading
could not possibly be cured by the allegation of other
facts.” Bly-Magee v. California, 236 F.3d
1014, 1019 (9th Cir. 2001) (quoting Lopez v. Smith,
203 F.3d 1122, 1127 (9th Cir. 2000)). In his opposition
brief, Plaintiff argues he is able to assert additional facts
to cure any deficiency against Solutions. (Doc. No. 26 at
13-14.) Thus, the Court dismisses Plaintiff's claims
against Solutions with leave to amend.
PILLSBURY MOTION TO DISMISS
named Defendants Pillsbury Winthrop Shaw Pittman LLP and
Christian Salaman (together the “Pillsbury
Defendants”) in two of his claims: (1) breach of
fiduciary duties of care and loyalty, (Doc. No. 16 at 12),
and (2) professional negligence, (id. at 19). The
Pillsbury Defendants represented BT as legal counsel during
the relevant times. (Id. ¶ 22; see
also Doc. No. 20-1 at 4.) As counsel for BT, Plaintiff
alleges the Pillsbury Defendants violated their duties to
Plaintiff. The Pillsbury ...