United States District Court, C.D. California
J.H. ROSE LOGISTICS, LLC
BONERTS INCORPORATED ET AL.
Present: The Honorable CHRISTINA A. SNYDER JUDGE
CIVIL MINUTES - GENERAL
DEFENDANTS' MOTION TO DISMISS SECOND AMENDED COMPLAINT
(DKT. 32, FILED OCTOBER 12, 2017)
11, 2017, plaintiff J.H. Rose Logistics, LLC initiated this
action against defendants Bonert's Inc. d/b/a
Bonert's Slice of Pie (hereafter,
"Bonert's" or the "bakery") in
addition to the bakery's owner, Michael Bonert, and
several limited-liability entities: Beefam LLC, Bonert's
3144 LLC, Bonert's MV LLC, Bonert's Jadahasa LLC, and
Bonert's Mibon LLC. Dkt. 1.
31, 2017, defendants filed a motion dismiss the complaint
pursuant to Federal Rule of Civil Procedure 12(b)(6). Dkt.
18. On August 21, 2017, plaintiff filed a First Amended
Complaint ("FAC") as matter of course pursuant to
Federal Rule of Civil Procedure 15(a)(1), thereby mooting
defendants' pending motion. Dkts. 21, 25. Plaintiff
proceeded to file two successive notices of withdrawal and
then filed a different version of the FAC on August 23, 2017,
which removed Michael Bonert, Jadahasa LLC, and Bonerts 3144
LLC as defendants. See Dkts. 22, 23, 24, 26. By
stipulation and with the Court's leave, plaintiff filed a
Second Amended Complaint on September 13, 2017. Dkt. 31
operative SAC, plaintiff asserts claims for (1) breach of
contract, (2) quasi-contract, (3) fraud and intentional
misrepresentation, and (4) negligent misrepresentation
against Bonert's, Beefam LLC, Bonert's MV LLC, and
Bonert's Mibon LLC. In brief, the SAC alleges that the
now-defunct bakery breached a contract for freight shipping
services and refuses to pay plaintiff $209, 193.22 in
outstanding freight charges. Plaintiff seeks to hold the
various limited-liability entities (hereafter, "the
LLCs") liable based on a single-business-enterprise
theory of alter ego liability.
October 12, 2017, defendants filed a Rule 12(b)(6) motion to
dismiss the SAC. Dkt. 32 ("Mot."). On October 30,
2017, plaintiff filed an opposition, dkt. 37
("Opp'n"); and defendants filed a reply on
November 6, 2017, dkt. 38 "(Reply"). Having
carefully considered the parties arguments, the Court finds
and concludes as follows.
a New Mexico-based interstate freight broker-carrier, alleges
the following facts. SAC ¶ 41-42. Bonert's is a
closely held, family-owned corporation that manufactured pies
and other baked goods for national retailers such as Walmart
and Safeway before it went into receivership on July 28,
2016. Id. ¶¶ 6, 61, 70. Between October
22, 2015 and April 29, 2016, plaintiff transported
Bonert's perishable goods to the bakery's consignees,
but the bakery has refused to pay plaintiff $209, 193.33 in
outstanding freight charges. Id. ¶ 73, 78, 80,
83. Plaintiff alleges that the bakery and the LLCs constitute
a single business enterprise that "schemed" to
"receive free freight transportation" from
plaintiff. Id. ¶ 4.
Alter Ego Allegations
Bonert founded the bakery in 1993 and remains the
corporation's president. Id. ¶ 6. He is the
trustee of the "Michael Bonert and Vivien Bonert
Revocable Trust, " which owns shares in the bakery.
Id. ¶ 64. From 1998 to 2002, the bakery
operated out of a leased facility at 2727 South Susan Street
in Santa Ana, California (hereafter, the "Susan Street
property"). Id. ¶¶ 6-8.
2000, Michael Bonert organized Beefam LLC. Michael and his
wife, Vivien Bonert, were members of Beefam LLC. Id.
¶ 8, Ex. B. In July 2000, the Union Bank of California
loaned Beefam LLC $435, 000 secured by a deed of trust on
another property in Santa Ana, 3122 West Adams Street
(hereafter, the "Adams Street property"), which
Beefam LLC leased to the bakery. Michael Bonert signed for
both Beefam LLC and the bakery, and the lease was not
recorded. Id. ¶¶ 12-14, Ex. C. In August
2002, Beefam LLC bought the Susan Street property and leased
it to the bakery. Id. ¶¶ 9-10. In May
2008, Beefam LLC granted a deed of trust to First Federal
Bank of California, which provided that the LLCs assets would
be cross-collateralized to secure a $3, 500, 000 loan to the
bakery. Id. ¶¶ 21-23, Ex. E. And in
February 2010, Beefam LLC obtained a $955, 000 loan from
Manufacturers Bank secured by a deed of trust on the Susan
Street property. Id. ¶ 19, Ex. D.
April 2009, Michael Bonert organized Bonert's MV LLC,
and, like Beefam LLC, both he and his wife were members. In
July 2009, Bonert's MV LLC leased the Adams Street
property to the bakery. Id. ¶ 16-17. Like
Beefam LLC, Bonert's MV LLC also provided its assets as
collateral to secure loans for the bakery. Id.
December 2014, Bonert's Mibon LLC filed a Statement of
Information with the California Secretary of State listing
Robert Erikson as president and Michael Bonert as a member.
Plaintiff alleges "[t]hese names do not reflect who
really controlled" the LLC. Id. ¶ 33. A
subordination agreement between Manufacturers Bank,
Bonert's Mibon LLC, and the bakery indicates that the LLC
owned real property at 3000-3030 West Warner Avenue in Santa
Ana (hereafter, the "Warner Avenue property"),
rented the property to the bakery, and obtained a loan
secured by a deed of trust on the property. Id.
¶ 27, ...