Jamel, LLC et al v. Mugel, et al.

Filing 26

ORDER - IT IS ORDERED DENYING Dft's 14 Motion to Dismiss Case as moot. FURTHER ORDERED GRANTING Plas' 21 Motion for Leave to Amend. The clerk shall file the lodged amended complaint under LRCiv. 15.1(c). Signed by Judge Frederick J Martone on 5/15/09. (SAT)

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NOT FOR PUBLICATION IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

Jamel, LLC, an Arizona limited liability) company; William Reiber and Cynthia) Reiber, husband and wife; James R.) Shough and Elaine V. Shough, husband) and wife; Claude Lemieux and Debra) ) Lemieux, husband and wife, ) ) Plaintiffs, ) ) vs. ) ) Michael H. Mugel, an unmarried) individual; Michael H. Mugel, as Trustee) of the Michael H. Mugel Trust, a) California Trust; Red Mountain Retail) Group, Inc., a California corporation; TBI) C o n s t r u c t i o n , Inc., a California) ) corporation, ) ) Defendants.

No. CV 08-2325-PHX-FJM ORDER

This action arises out of the marketing and sale of non-managing membership interests in several limited liability companies created to own and operate real estate projects. The court has before it defendants Michael Mugel, individually and as trustee of the Michael Mugel Trust, Red Mountain Retail Group, Inc., and TBI Construction, Inc.'s motion to dismiss (doc. 14), plaintiffs Jamel, LLC, William and Cynthia Reiber, James and Elaine Shough, and Claude and Debra Lemieux's motion for leave to amend complaint and response and first amended complaint (docs. 21 & 22), and defendants' reply (doc. 25).

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Plaintiffs' complaint contains twenty counts including federal securities law (counts I & II) and various state law (counts III-XX) claims. Defendants move to dismiss on the grounds that plaintiffs have failed to meet the pleading requirements of Rule 8(a)(2), Fed. R. Civ. P., or the heightened pleading requirements of Rule 9(b), Fed. R. Civ. P., and the Private Securities Litigation Reform Act of 1995. In response, plaintiffs move for leave to amend their complaint. Defendants have not responded to plaintiffs' motion for leave to amend, but make clear that their motion to dismiss applies to plaintiffs' original complaint only. Under Rule 15(a), Fed. R. Civ. P., a party may amend a pleading once as of right at any time before a responsive pleading has been filed. At this point, defendants have only filed a motion to dismiss plaintiffs' complaint, which is not a responsive pleading. Miles v. Dep't of Army, 881 F.2d 777, 782 (9th Cir. 1989). Plaintiffs, therefore, still have the right to amend their complaint without leave of court. Rule 15(a)(1)(A), Fed. R. Civ. P. Once a complaint has been amended, "[t]he amended complaint supersedes the original, the latter being treated thereafter as non-existent." Loux v. Rhay, 375 F.2d 55, 57 (9th Cir. 1967) (citations omitted). Because plaintiffs have lodged a first amended

complaint, defendants motion to dismiss the original complaint is now moot and must be denied on those grounds. This is, of course, without prejudice to defendants' right file a motion to dismiss plaintiffs' amended complaint. Accordingly, IT IS ORDERED DENYING defendants' motion to dismiss as moot (doc. 14). IT IS FURTHER ORDERED GRANTING plaintiffs' motion for leave to amend (doc. 21). The clerk shall file the lodged amended complaint under LRCiv. 15.1(c). DATED this 15th day of May, 2009.

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