Auto Now Financial Services Incorporated v. Abdeljaber et al
Filing
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ORDER denying Defendant's Motion to Dismiss (Doc. 76 ). See Order for details. Signed by Judge Neil V. Wake on 8-13-13. (NVW, nb)
Auto Now Financial Services Incorporated v. Abdeljaber et al
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Doc. 87
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IN THE UNITED STATES DISTRICT COURT
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FOR THE DISTRICT OF ARIZONA
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Auto Now Financial Services, Inc., dba
Tico Rico Te Ayuda,
No. CV-13-00918-PHX-NVW
ORDER
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Plaintiff,
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v.
Mohammed H. Abdeljaber and Jane Doe 1
Abdeljaber; Rafat Abdeljaber and Jane Doe
2 Abdeljaber; Nashat Hasan Abdeljaber and
Jane Doe 3 Abdeljaber; SW Money
Express, LLC; AZ Tune Up Masters, LLC;
NRM Investors, LLC; all of the foregoing
Defendants dba Tia Rica, Tia Rica No Te
Friega, Mr. Cash For Gold, Mr. Cash For
Titulos; Gladys Martinez and John Doe
Martinez; Black and White Corporations 110; John Does and Jane Does 1-10,
Defendants.
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Before the Court is the Consolidated Motion to Dismiss Defendants Mohammed
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and Jane Doe 1 Abdeljaber, Rafat and Jane Doe 2 Abdeljaber, Nashat and Jane Doe 3
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Abdeljaber, AZ Tune Up Masters, LLC, and NRM Investors, LLC (“Defendants’
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Motion”) (Doc. 76), as well as Plaintiff’s Response. No Reply was filed. (See Doc. 81.)
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Defendants’ Motion will be denied.
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Dismissal under Rule 12(b)(6) of the Federal Rules of Civil Procedure can be
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based on “the lack of a cognizable legal theory” or “the absence of sufficient facts alleged
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under a cognizable legal theory.” Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699
Dockets.Justia.com
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(9th Cir. 1990). To avoid dismissal, a complaint need include “only enough facts to state
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a claim for relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544,
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570 (2007). On a motion to dismiss under Rule 12(b)(6), all allegations of material fact
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are assumed to be true and construed in the light most favorable to the non-moving party.
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Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). Finally, a court generally may
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not consider any material beyond the pleadings when ruling on a Rule 12(b)(6) motion.
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Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (citation omitted).
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Defendants’ Motion is broadly premised on two arguments: (1) the Complaint
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fails to assert a theory of liability that extends beyond Defendant SW Money Express,
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LLC (“SW Money”) to the other defendants; and (2) the Complaint fails to include the
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specificity required of claims sounding in fraud. (Doc. 76 at 2.) Auto Now contends in
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turn that Defendants failed to follow this Court’s required meet-and-confer procedure and
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that the alter-ego theory of liability (alternatively, piercing the corporate veil) discussed
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by Defendants is not the only theory under which Auto Now sues Defendants. Further,
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Auto Now argues that the Complaint sufficiently states a claim under the theory of alter-
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ego liability and that it need not satisfy the fraud requirement for such a claim.
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Defendants’ counsel certified that it attempted to confer with Auto Now as
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required by this Court’s Order dated May 6, 2013 (Doc. 6). (See Doc. 76 at 21.) That
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Order mandates a meeting between parties prior to a motion to dismiss and that the
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parties certify that they “have conferred to determine whether an amendment could cure a
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deficient pleading, and have been unable to agree that the pleading is curable” if a party
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does file such a motion. (Doc. 6 at 1.) Auto Now explains that Defendants’ counsel
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contacted Auto Now’s counsel to initiate the meet-and-confer process but did not await a
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reply before filing Defendants’ Motion. Such an attempt by Defendants’ counsel is
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entirely insufficient to satisfy this Court’s Order and is a basis for denial of Defendants’
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Motion.
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//
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However, Defendants’ Motion also fails, and will be denied, on its merits. It
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hinges on the assumption that Auto Now has sued a number of individual and LLC
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defendants under theories of piercing and reverse-piercing the corporate veil, all for
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misconduct by Defendant SW Money. However, Auto Now alleges misconduct by each
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Defendant on whose behalf Defendants’ Motion was filed. For example, Auto Now’s
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First Amended Complaint alleges that Defendants Mohammed, Rashat, and Nashat
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Abdeljaber “repeatedly contacted [Auto Now’s employee] while she was still employed
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by Plaintiff. The purpose of the contacts was to solicit the cooperation of [that employee]
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in stealing Plaintiff’s confidential information” for Defendants’ benefit. (Doc. 51 ¶ 24.)
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As another example, Auto Now alleges that Defendant NRM Investors, LLC “licensed
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nine of its ten locations within days of hiring [Auto Now’s former employee],” (id. ¶ 25),
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potentially allowing for an inference of wrongdoing by NRM Investors, LLC. Auto Now
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has grounded its First Amended Complaint in large part on the theory that each
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Defendant acted as a co-principal in the misappropriation of confidential information and
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other violations. As such, Auto Now need not allege sufficient facts to state a claim
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under a theory of alter-ego liability in order to survive Defendants’ Motion. The issue of
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whether Auto Now has laid out sufficient facts to support such a theory need not be and
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is not decided here.
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In addition, Auto Now’s First Amended Complaint does not sound in fraud, and
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moreover Auto Now does not necessarily need to present its allegations with the
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particularity required for fraud claims, given the nature of its allegations.
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Finally, both parties’ requests for attorney’s fees and costs will be denied.
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IT IS THEREFORE ORDERED denying the Consolidated Motion to Dismiss
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Defendants Mohammed and Jane Doe 1 Abdeljaber, Rafat and Jane Doe 2 Abdeljaber,
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Nashat and Jane Doe 3 Abdeljaber, AZ Tune Up Masters, LLC, and NRM Investors,
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LLC (Doc. 76).
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IT IS FURTHER ORDERED denying the parties’ requests for attorney’s fees
and costs.
Dated this 13th day of August, 2013.
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