United States District Court, N.D. California
ORDER RE: MOTION TO DISMISS RE: DKT. NO. 19
S. HIXSON UNITED STATES MAGISTRATE JUDGE.
Venture General Agency, LLC and Old American County Mutual
Fire Insurance Co. bring a negligence claim against Defendant
Wells Fargo Bank, N.A. after a third party fraudulently
induced Venture to transfer $1, 708, 112.86 into an account
held by the third party at Wells Fargo. Pending before the
Court is Wells Fargo's Motion to Dismiss pursuant to
Federal Rule of Civil Procedure 12(b)(6). ECF No. 19.
Plaintiffs filed an Opposition (ECF No. 20) and Defendant
filed a Reply (ECF No. 21). The Court finds this matter
suitable for disposition without oral argument and
VACATES the October 17, 2019 hearing.
See Civ. L.R. 7-1(b). Having considered the
parties' positions and the relevant legal authority, the
Court GRANTS Wells Fargo's motion for
the following reasons.
Court laid out in detail the allegations in this case in its
order granting Wells Fargo's motion to dismiss
Plaintiffs' original complaint. ECF No. 16. Because the
First Amended Complaint (“FAC”) is largely
identical to the original complaint, the Court assumes
familiarity with those allegations and will not repeat them
in full here. Summarizing the dispute, however, Plaintiff
Venture General Agency, acting as a managing general agent
(“MGA”) for Old American, was fraudulently
induced by an unknown, third-party fraudster into
transferring $1, 708, 112.86 of Old American's funds into
a fraudulent account opened with Wells Fargo in Old
American's name. Plaintiffs' original complaint (ECF
No. 1), filed on May 21, 2019, asserted one count of
negligence and one count of negligence per se against Wells
Fargo. Wells Fargo moved for dismissal of that complaint on
June 25, 2019. ECF No. 8.
reviewing Wells Fargo's motion to dismiss the original
complaint, the Court found that a bank does not owe a duty of
care to noncustomers. It found that because the complaint did
not allege that Plaintiffs were customers of Wells Fargo, it
failed to plead allegations showing a duty of care owed by
Wells Fargo to Plaintiffs. Thus, the Court found Plaintiffs
failed to state a valid claim of negligence. It dismissed
that claim with leave to amend. Regarding Plaintiffs'
negligence per se claim, the Court noted that the claim was
based on Wells Fargo's alleged failure to comply with the
Bank Secrecy Act (“BSA”) as amended by the USA
PATRIOT Act, 31 U.S.C. §§ 5311-32. The Court found
that there is no private right of action under the BSA or
Patriot Act, and that because there is no private right of
action, there can be no duty of Wells Fargo to Plaintiffs
arising out of those acts. The Court dismissed
Plaintiffs' negligence per se claim without leave to
FAC makes the same factual allegations in support of the
negligence claim as the original complaint did, save for the
addition of the following:
During the relevant time periods herein, Old American
maintained two premium trust accounts with Wells Fargo, which
were joint accounts shared by Old American as well as its
MGAs. One such premium trust account, ending in *7076, was
opened in or about August 2012, while the other such premium
trust account, ending in *3430, was opened in or about
September 2015. These accounts remain open and active between
Old American and/or its MGAs and Wells Fargo.
FAC ¶ 7.
Fargo has moved for dismissal of the FAC pursuant to Federal
Rule of Civil Procedure 12(b)(6). ECF No. 19.
complaint must contain a “short and plain statement of
the claim showing that the pleader is entitled to
relief.” Fed.R.Civ.P. 8(a)(2). To survive a Rule
12(b)(6) motion to dismiss, a complaint must plead
“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). Plausibility does not
mean probability, but it requires “more than a sheer
possibility that a defendant has acted unlawfully.”
Ashcroft v. Iqbal, 556 U.S. 662, 687 (2009). A
complaint must provide a defendant with “fair
notice” of the claims against it and the grounds for
relief. Twombly, 550 U.S. at 555 (quotations and
citation omitted); Fed.R.Civ.P. 8(a)(2) (A complaint must
contain a “short and plain statement of the claim
showing that the pleader is entitled to relief.”). In
considering a motion to dismiss, the court accepts factual
allegations in the complaint as true and construes the
pleadings in the light most favorable to the nonmoving party.
Manzarek v. St. Paul Fire & Marine Ins. Co., 519
F.3d 1025, 1031 (9th Cir. 2008).; Erickson v.
Pardus, 551 U.S. 89, 93-94 (2007). However, “the
tenet that a court must accept a complaint's allegations
as true is inapplicable to threadbare recitals of a cause of
action's elements, supported by mere conclusory
statements.” Iqbal, 556 U.S. at 678.
Rule 12(b)(6) motion is granted, the “court should
grant leave to amend even if no request to amend the pleading
was made, unless it determines that the pleading could not
possibly be cured by the allegation of other facts.”
Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000)
(en banc) (citations and quotations omitted). However, the
Court may deny leave to amend for several reasons, including
“undue delay, bad faith or dilatory motive on the part
of the movant, repeated failure to cure deficiencies by
amendments previously allowed, undue prejudice to the
opposing party by virtue of allowance of the amendment, [and]
futility of amendment.” Eminence Capital, LLC v.
Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003)
(citing Foman v. Davis, 371 U.S. 178, 182 (1962)).