Alexander Leibman v. Alexander Sasha Prupes et al
Filing
37
MINUTE ORDER (IN CHAMBERS) by Judge Christina A. Snyder: Leibman's motion to dismiss is DENIED. Leibman is directed to file an answer to the counterclaim by July 3, 2015. 29 (pg)
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
2:14-CV-09003-CAS (VBKx)
Title
ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
Present: The Honorable
Date
‘O’
June 18, 2015
CHRISTINA A. SNYDER
Catherine Jeang
Deputy Clerk
Not Present
Court Reporter / Recorder
N/A
Tape No.
Attorneys Present for Plaintiffs:
Attorneys Present for Defendants:
Not Present
Not Present
Proceedings:
(In Chambers) COUNTERDEFENDANT’S MOTION TO
DISMISS COUNTERCLAIM (Dkt. 29, filed May 12, 2015)
The Court finds this matter appropriate for decision without oral argument. Fed. R.
Civ. P. 78; Local Rule 7-15.
I.
INTRODUCTION
On March 27, 2015, plaintiff and counterdefendant Alexander Leibman
(“Leibman”) filed the operative Second Amended Complaint (SAC) against defendant
and counterclaimant Alexander “Sasha” Prupes (“Prupes”), alleging a state law claim for
civil extortion and seeking declaratory and injunctive relief. Dkt. 25. Prupes filed a
counterclaim on April 10, 2015, alleging state law claims for (1) breach of contract; (2)
breach of the covenant of good faith and fair dealing; (3) promissory estoppel; (4) fraud
in the inducement and intentional misrepresentation; (5) wrongful termination in
violation of public policy; and (6) violation of California Labor Code § 1102.5. Dkt. 26.
On May 12, 2015, Leibman moved to dismiss the counterclaim for lack of subject matter
jurisdiction and failure to state a claim. Dkt. 29. Prupes opposed the motion on June 8,
2015, dkt. 33, and Leibman replied on June 15, 2015. Dkt. 36.
II.
FACTUAL BACKGROUND
The counterclaim alleges the following facts, the truth of which the Court assumes
for purposes of this motion.
In the spring of 2012, Leibman offered Prupes a job working in one of Leibman’s
hair restoration clinics in Moscow, Russia. Countercl. ¶ 8. Prupes was to work six
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ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
months each calendar year for a fixed monthly salary of $25,000, a variable commission
equal to three percent of sales, and living accommodations paid for by Leibman. Id. The
commissions were estimated to total between $3,000 and $5,000 per month. Id. Prupes
accepted the offer and began wrapping up his business affairs in New Jersey in
preparation for his move to Russia. Id. He also spent a week working on Leibman’s
website in order to better market the Moscow clinic. Id. However, Leibman delayed
Prupes’s start date “based on a variety of excuses,” and on December 31, 2012, Leibman
rescinded his offer of employment. Id. ¶¶ 9-11.
On the same day he rescinded the original offer, Leibman proposed a new business
arrangement whereby he would invest $200,000 for Prupes to open a hair restoration
clinic in Kiev, Ukraine. Id. ¶ 12. In exchange, Prupes was to assume responsibility for
the clinic’s start-up and daily operation. Id. The parties agreed to split all profits equally
until Leibman recouped his initial investment, after which Prupes would keep seventyfive percent of the profits and Leibman the remaining twenty-five percent. Id. Leibman
agreed to pay Prupes a monthly salary of $5,000 to $10,000 in addition to
reimbursements for living and business expenses. Id.
Over the course of the next several months, the parties communicated often and
began implementing their plan for the Kiev clinic. Id. ¶ 13. Leibman also supplied the
first $10,000 of the investment, which Prupes used to pay for supplies and a flight to
Moscow in April 2013. Id. Prupes met with Leibman and his associates in Moscow, and
thereafter moved to Kiev to open the clinic. Id.
While in Kiev, Prupes received notice that Leibman had transferred a fifteen
percent stake in the clinic to Globodyne Investments, Inc. (“Globodyne”), a Panamanian
company, in exchange for $50,000 per month in royalty payments. Id. ¶ 14. Prupes
expressed his concerns about the legality of this arrangement, only to be told by Leibman
that Globodyne was his company and that Prupes should not worry about it, as Leibman
would “deal with it.” Id. Prupes accepted this explanation and continued work on the
Kiev clinic. Id. ¶ 15.
In October 2013, geopolitical unrest befell Ukraine, causing the local currency to
drop in value and the Kiev clinic to fail. Id. ¶ 16. As of February 2014, Leibman had
invested $108,000 of the agreed-upon $200,000. Id. However, although he had
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occasionally reimbursed Prupes for business expenses, Leibman had not paid Prupes any
salary. Id. ¶ 15.
In February 2014, following the failure of the Kiev clinic, Leibman again offered
Prupes the opportunity to manage Leibman’s clinic in Moscow. Id. ¶ 17. This time,
Leibman proposed a monthly salary of $10,000, commissions estimated at about $3,000,1
a rent-free apartment, and a private driver. Id. The parties agreed that this was a
“permanent” job offer. Id. In the interest of starting fresh, Prupes allowed Leibman to
withhold commission payments until Leibman had recouped $54,000, or half of the
$108,000 investment Leibman had lost on the Kiev clinic. Id. In April 2014, Prupes left
Kiev and moved to Moscow, where he met with Leibman and Leibman’s attorney. Id. ¶
18. Leibman’s attorney informed Prupes of the steps to be taken to ensure a legal right to
work in Russia, such as obtaining a Russian tax identification number, all of which
Prupes did at his own expense. Id. Leibman’s attorney also assured Prupes that there
would be no legal barriers to acquiring the requisite authorization to work in the country.
Id.
For the next three months, Prupes managed the Moscow clinic in accordance with
the terms of the agreement. Id. ¶ 19. He was paid $30,000 in salary, although Leibman
retained an additional $8,000 due in commissions, as the parties agreed, for recoupment
of losses in connection with the Kiev clinic. Id. During Prupes’s time at the Moscow
clinic, Leibman repeatedly insisted that Prupes encourage customers to pay in cash, since
doing so lowered Leibman’s tax bill. Id. Prupes expressed his discomfort and
disapproval of this practice on several occasions. Id.
Prupes returned to the United States to renew his visa in July 2014. Id. ¶ 20.
However, just before Prupes went back to Moscow in August 2014, Leibman informed
Prupes that Prupes was not authorized to work in Russia. Id. ¶ 21. Prupes regards that
explanation as false, and merely an excuse by which to avoid any further scrutiny of
Leibman’s tactics, including his possible under-reporting of income and the use of
Globodyne as a “shell” company for unlawful transactions, both of which Prupes had
previously questioned. Id.
1
The counterclaim is unclear as to the time period covered by this estimate.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
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Case No.
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June 18, 2015
Title
ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
Prupes alleges that he incurred damages in reliance on Leibman’s promises,
including forgoing other job opportunities during the two years in which he dealt with
Leibman. Id. ¶ 22. Prupes also claims that he is owed money under the parties’ oral
contract for unpaid salary and other expenses. Id.
III.
LEGAL STANDARD
A Rule 12(b)(6) motion tests the legal sufficiency of the claims asserted in a
complaint. While a complaint “does not require detailed factual allegations, [] it demands
more than an unadorned, the-defendant-unlawfully-harmed-me accusation. A pleading
that offers labels and conclusions or a formulaic recitation of the elements of a cause of
action will not do. Nor does a complaint suffice if it tenders naked assertions devoid of
further factual enhancement.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
In considering a such a motion, a court must accept as true all material allegations
in the complaint, as well as all reasonable inferences to be drawn from them. Navarro v.
Block, 250 F.3d 729, 732 (9th Cir. 2001). The allegations must be read in the light most
favorable to the nonmoving party. Shwarz v. United States, 234 F.3d 428, 435 (9th Cir.
2000). However, “a court considering a motion to dismiss can choose to begin by
identifying pleadings that, because they are no more than conclusions, are not entitled to
the assumption of truth. While legal conclusions can provide the complaint’s framework,
they must be supported by factual allegations.” Iqbal, 556 U.S. at 679. Ultimately,
“[d]etermining whether a complaint states a plausible claim for relief will . . . be a
context-specific task that requires the reviewing court to draw on its judicial experience
and common sense.” Id.
The Court cannot consider material outside the pleadings unless it converts the
motion to dismiss into a motion for summary judgment. Anderson v. Angelone, 86 F.3d
932, 934 (9th Cir. 1996). However, a court may take judicial notice of exhibits submitted
with or alleged in the counterclaim whose authenticity is not contested, as well as matters
of public record. Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001).
As a general rule, leave to amend should be freely granted. Fed. R. Civ. P. 15(a);
Foman v. Davis, 371 U.S. 178, 182 (1962). Nevertheless, leave may be denied when “the
court determines that the allegation of other facts consistent with the challenged pleading
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UNITED STATES DISTRICT COURT
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Case No.
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June 18, 2015
Title
ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
could not possibly cure the deficiency.” Schreiber Distrib. Co. v. Serv-Well Furniture
Co., 806 F.2d 1393, 1401 (9th Cir. 1986).
Leibman argues that (1) all six claims for relief fail because Leibman was not
Prupes’s employer; (2) the applicable statute of limitations bars the first, second, and
third claims for breach of contract, breach of the covenant of good faith and fair dealing,
and promissory estoppel; (3) the first claim for breach of contract is unenforceable as per
the statute of frauds; and (4) all six of Prupes’s claims must be dismissed based on the
presumption against extraterritoriality. Alternatively, Leibman requests an order requiring
Prupes to provide a more definite statement pursuant to Federal Rule of Civil Procedure
12(e).
IV.
DISCUSSION
A.
Leibman’s Subject Matter Jurisdiction Argument
On a motion brought under Federal Rule of Civil Procedure 12(b)(1), the
complaining party bears the burden of establishing the Court’s subject matter jurisdiction.
Thompson v. McCombe, 99 F.3d 352, 353 (9th Cir.1996). A federal court is presumed to
lack such jurisdiction unless the contrary affirmatively appears. Gen. Atomic Co. v.
United Nuclear Corp., 655 F.2d 968-69 (9th Cir. 1981).
Leibman argues that this Court lacks jurisdiction over Prupes’s counterclaims
because the underlying conduct occurred entirely outside the United States, and thus, the
presumption against extraterritoriality bars their prosecution in this Court. Mot. at 4-11.
Although Leibman presents this argument as a challenge to the Court’s subject matter
jurisdiction under Rule 12(b)(1), the question is more properly framed as one challenging
the sufficiency of Prupes’s allegations under Rule 12(b)(6). To ask what conduct a
statute reaches is to ask what conduct it prohibits—a merits question—where by contrast,
“subject matter jurisdiction . . . refers to a tribunal’s power to hear a case.” Morrison v.
Nat’l Australia Bank, 561 U.S. 247, 253-54 (2010) (internal quotations and citations
omitted) (explaining the error many courts make in deciding extraterritoriality questions
under Rule 12(b)(1) rather than Rule 12(b)(6)). Leibman does not dispute that the
requirements for diversity jurisdiction are satisfied, 28 U.S.C. § 1332, or that the Court
may alternatively exercise supplemental jurisdiction over Prupes’s counterclaims. 28
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UNITED STATES DISTRICT COURT
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Case No.
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Title
ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
U.S.C. § 1367. Therefore, this Court has subject matter jurisdiction, and Leibman’s
extraterritoriality argument is addressed below as arising under Rule 12(b)(6).
B.
Prupes’s Employer
Leibman argues that Prupes’s claims must be dismissed because the contracts were
entered into with the clinics in Moscow and Kiev rather than with Leibman personally,
and as such, Leibman was not Prupes’s employer. While Leibman is correct that an
individual supervisor may not be held personally liable for actions taken on behalf of the
employer, Miklosy v. Regents of Univ. of Cal., 44 Cal. 4th 876, 900 (2008), Prupes
plausibly alleges that Leibman was the employer and the contracting party.2 Throughout
the entire counterclaim, Prupes describes the employment relationship as only between
Prupes and Leibman, and repeatedly describes the clinics as Leibman’s. See Countercl.
¶¶ 8, 17. Taking Prupes’s allegations as true, at no point did any other person claim to
represent the interests of the clinics or present themselves as having power to control any
of the clinics’ operations.3
Leibman may well be able to show that he was not truly the contracting party or
the employer. But that is properly done on motion for summary judgment. Viewing the
allegations in the light most favorable to the nonmoving party, Shwarz, 234 F.3d at 435,
and drawing all reasonable inferences from them, Navarro, 250 F.3d at 732, the Court
finds that Prupes has sufficiently alleged that Leibman was his employer and the
contracting party.
2
Leibman cites extensively from Cartwright v. Regents of the Univ. of Cal., 2009
WL 2190072 (E.D. Cal. July 22, 2009), for the proposition that there is “no basis . . . to
hold Mr. Leibman liable as an employer or a contracting party.” Mot. at 13. Cartwright,
however, merely reaffirmed the principle that an individual who is not an employer may
not be held personally liable for wrongful discharge. Id. at *8. That is irrelevant where,
as here, Prupes alleges that Leibman was the employer.
3
Indeed, Leibman suggests in his own SAC that he was the contracting party and
thus the employer. See SAC, dkt. 25, ¶ 8 (“Leibman considered retaining Mr. Prupes for
his services . . .”); ¶ 10 (“I [Leibman] cannot risk it and continue our business
relationship.”) (emphasis added).
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
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Case No.
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Title
ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
C.
Date
‘O’
June 18, 2015
Statute of Limitations
Next, Leibman argues that the first through third claims for breach of contract,
breach of the covenant of good faith and fair dealing, and promissory estoppel must fail
as they were brought outside of the applicable two-year statute of limitations for oral
contracts. Cal. Civ. Pro. Code § 339. He posits that the contract was entered into in the
spring of 2012, and any “new employment arrangement does not and cannot constitute
another ‘oral’ agreement subsequent to the first.” Mot. at 15. Thus, Leibman contends,
Prupes was put on notice of the breach in the summer of 2012 at the latest, when
Leibman rescinded his offer of employment at the Moscow clinic. Id. Prupes counters
that there were multiple contracts, Countercl. ¶¶ 8, 12, 17, an allegation which the Court
must accept as true. Navarro, 250 F.3d at 732.
To the extent Prupes seeks damages accruing prior to November 20, 2012—two
years before the filing of the original complaint in this case—they are barred absent some
basis for equitable tolling or estoppel.4 Jones v. Mortimer, 28 Cal. 2d 627, 633 (1946)
(“The statute of limitations is not available to plaintiff as to defendants’ counterclaim if
the period has not run on it at the time of commencement of plaintiff’s action even
though it has run when the counterclaim is pleaded.”). However, Prupes’s counterclaim
only concerns the last of three alleged contracts, which he clearly alleges was breached in
July 2014. Countercl. ¶¶ 21, 22, 24, 25, 29, 32, 33. “In a suit to enforce an oral
agreement, the statute of limitations in section 339(1) begins to run when the oral
contract is repudiated.” Parker v. Walker, 5 Cal. App. 4th 1173, 1190 (1992). Thus,
Prupes’s first through third claims, insofar as they are based on the July 2014 breach of
the last contract, are timely.
4
At one point, Prupes claims that he was forced to “eschew[] other job
opportunities during the over two years that he relied on Leibman’s promises.”
Countercl. ¶ 22. Prupes may not properly collect any damages for eschewed job
opportunities prior to November 20, 2012, to the extent recovery is based on his first
through third causes of action. Jones v. Mortimer, 28 Cal. 2d 627, 633 (1946).
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
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Case No.
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Title
ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
D.
Date
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June 18, 2015
Statute of Frauds
California’s Statute of Frauds provides that “[a]n agreement that by its terms is not
to be performed within a year from the making thereof” is invalid unless memorialized in
writing. Cal. Civ. Code § 1624(a)(1). Leibman contends that Section 1624 bars Prupes’s
breach of contract claim. As support, he points to Prupes’s allegations that the contract
was for a “permanent” job of “indefinite duration” in the Moscow clinic. Countercl. ¶¶
17, 24. This, Leibman argues, necessarily shows that the employment was contemplated
to last more than one year.
Leibman’s argument misses the mark. First, the Ninth Circuit has plainly stated
that, under California law, “an oral contract for ‘permanent employment’ or of other
indefinite duration does not come within the Statute of Frauds.” Fibreboard Products,
Inc. v. Townsend, 202 F.2d 180, 183 (9th Cir. 1953). Second, Section 1624(a)(1)
“applies only to those contracts which, by their terms, cannot possibly be performed
within one year.” White Lighting Co. v. Wolfson, 68 Cal. 2d 336, 343 (1968) (emphasis
added). Accordingly, “if by its terms performance of a contract is possible within one
year, the contract does not fall within the statute even though it is probable that it will
extend beyond one year.” Plumlee v. Poag, 150 Cal. App. 3d 541, 548-49 (1984). The
employment contract at issue in this case did not expressly preclude performance within
one year. Finally, when an alleged oral contract may be terminated at will by either
party, “it can, under its terms, be performed within one year.” Wolfson, 68 Cal. 2d at
344. At the time Prupes’s “employment relationship with [Leibman] was terminated,
[Prupes] had completely performed; [Leibman’s] performance consisted of nothing more
than compensating [Prupes].” Id. at 350.
Leibman’s reliance on Ruinello v. Murray, 36 Cal. 2d 687 (1951), is misplaced.
While Ruinello held that the defendant may rely on the Statute of Frauds to defend
against an alleged breach of an employment contract, the oral agreement at issue in that
case “admittedly [was] not to be performed within one year.” Id. at 689. To the extent
that Leibman claims “permanent” should be read as “lifetime” rather than as a term of art
used to distinguish it from “temporary” employment, Mot. at 16, that interpretation is not
supported by the language in the counterclaim or by the law. See Townsend, 202 F.2d at
183. At no point does Prupes refer to the management position as a lifetime position, nor
is his claim for breach of contract premised on the notion that he is somehow entitled to
damages arising during the period after his termination. See Countercl. ¶ 22 (listing
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UNITED STATES DISTRICT COURT
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ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
damages only in reference to the period before termination). Therefore, Prupes’s breach
of contract claim is not barred by the Statute of Frauds.
E.
Extraterritoriality
It is “a longstanding principle of American law that legislation of Congress, unless
a contrary intent appears, is meant to apply only within the territorial jurisdiction of the
United States.” Morrison, 561 U.S. at 255 (internal quotations omitted); see also Foley
Bros. v. Filardo, 336 U.S. 281, 285 (1949). While the presumption against
extraterritoriality is merely a canon of construction rather than a limit on congressional
power, it nonetheless applies in all cases so that the Legislature may have a “stable
background against which . . . [to] legislate with predictable effects.” Morrison, 561 U.S.
at 261. California courts have adopted the same presumption with respect to state law.
See Sullivan v. Oracle Corp., 51 Cal.4th 1191, 1207 (2011).
As stated above, Leibman argues that since the oral contract at issue was formed
and provided for services to be performed outside the United States, the presumption
against extraterritoriality commands dismissal of Prupes’s counterclaims.5 In other
words, Leibman contends that because Prupes was employed in Russia and Ukraine, he
may not bring suit in the United States and under California law for claims related to that
employment. The Court finds that although the presumption may apply, Prupes’s
proposed application of California law would not “operate impermissibly with respect to
occurrences outside the state.” Id.
1.
Common Law Breach of Contract, Breach of the Covenant of
Good Faith and Fair Dealing, Promissory Estoppel, Fraud in the
Inducement, and Wrongful Termination
As a preliminary matter, Leibman has not proffered any authority supporting the
proposition that the presumption against extraterritoriality applies to common law claims.
See, e.g., Foley, 336 U.S. at 285 (applying presumption to a statute); Blazevska v.
5
Leibman’s Request for Judicial Notice, dkt. 36-1, is GRANTED. Fed. R. Evid.
201; Lee, 250 F.3d at 689. The Court notes that, as per Prupes’s declaration, dkt. 36-2,
the contract at issue was entered into overseas.
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Raytheon Aircraft Co., 522 F.3d 948, 952 (9th Cir. 2008) (same); Loving v. Princess
Cruise Lines, Ltd., 2010 A.M.C. 2533, 2544-47 (C.D. Cal. Mar. 5, 2009) (same). Indeed,
the presumption is limited to statutes by its terms. Morrison, 561 U.S. at 255 (defining
the principle in reference to “legislation of Congress”) (emphasis added). All of Prupes’s
claims, save for the sixth for violation of California Labor Code Section 1102.5, arise
under the common law.
Nonetheless, even assuming arguendo that the presumption applies to common law
claims, Leibman’s argument still fails. See Sullivan, 51 Cal. 4th at 1207 (having
concluded that the presumption against extraterritoriality applies, the Court “proceed[s]
to consider whether plaintiffs’ proposed application of the [law] would cause it to
operate, impermissibly, with respect to occurrences outside the state”). Under California
law, the relevant inquiry for whether a state law is being applied extraterritorially is not
the location of employment or where the contract was formed, but rather whether “the
conduct which gives rise to liability . . . occurs in California.” Diamond Multimedia Sys.,
Inc. v. Superior Court, 19 Cal. 4th 1036, 1059 (1999) (emphasis added); see also
Aalmuhammed v. Lee, 202 F.3d 1227, 1238 (9th Cir. 2000) (reversing dismissal based on
extraterritoriality because at least one party may have done work “by fax, phone, and
email from California”); In re iPhone 4S Consumer Litig., 2013 WL 3829653, at *4
(N.D. Cal. July 23, 2013) (noting that the presumption against extraterritoriality does not
prohibit claims brought by out-of-state plaintiffs when the defendant’s “critical
decisions” which gave rise to the suit took place in California); Wershba v. Apple
Computer, Inc., 91 Cal. App. 4th 224, 241 (2001) (upholding certification of a
nationwide class for violation of California law because the defendant’s “core decision”
giving rise to the lawsuit was made within the state). In this case, although the contract
was entered into in Russia or Ukraine, the actions which gave rise to liability—that is, the
alleged breach—occurred in California. By Leibman’s own admission, he was a
California resident managing his business from within the state at the time of Prupes’s
termination, and his emails to Prupes originated in California. See Leibman Decl., Dkt.
20-1, ¶ 2.6 Put another way, the alleged “core decision” to wrongfully terminate Prupes
6
The Court takes judicial notice of Leibman’s declaration submitted as part of his
opposition to Prupes’s motion to dismiss, which the Court granted in part on March 20,
2015. Dkt. 24. Judicial notice is proper as the declaration is a matter of public record
and its authenticity is not questioned. See Fed. R. Evid. 201; Lee, 250 F.3d at 689.
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and breach the contract was made in California. Wershba, 91 Cal. App. 4th at 241.
Moreover, “California has a clear and substantial interest preventing fraudulent practices
in this state and a legitimate and compelling interest in preserving a business climate free
of fraud and deceptive practices, and for that reason has a legitimate interest in extending
state-created remedies to out-of-state parties harmed by wrongful conduct occurring in
California.” Norwest Mortg., Inc. v. Superior Court, 72 Cal. App. 4th 214, 224 (1999).
Therefore, Prupes’s common law claims do not constitute improper extraterritorial
application of California law.
2.
California Labor Code Section 1102.5
California Labor Code Section 1102.5(b) provides in relevant part: “An employer,
or any person acting on behalf of the employer, shall not retaliate against an employee for
disclosing information, or because the employer believes that the employee disclosed or
may disclose information, to a government or law enforcement agency. . .” None of the
statutory language indicates that it was intended to apply extraterritorially, and as such,
“the presumption against extraterritoriality applies to [Section 1102.5] in full force.”
Sullivan, 51 Cal. 4th at 1207.
However, as discussed above in relation to Prupes’s common law claims, the issue
is whether “the conduct which gives rise to liability . . . occurs in California.” Diamond,
19 Cal. 4th at 1059. Again, the alleged decision to retaliate against Prupes for expressing
“disapproval on multiple occasions of Leibman’s questionable business practices,”
Countercl. ¶ 48, occurred in California. See Leibman Decl., Dkt. 20-1, ¶ 2. Thus,
Prupes’s “proposed application of [Section 1102.5] would [not] cause it to operate,
impermissibly, with respect to occurrences outside the state.” Sullivan, 51 Cal. 4th at
1207. Prupes’s statutory claim is not an improper extraterritorial application of
California law.
F.
Motion for a More Definite Statement
Finally, Leibman requests that Prupes be ordered to provide a more definite
statement in accordance with Federal Rule of Civil Procedure 12(e) on the grounds that
the counterclaim is “not intelligible.” Mot. at 17. Rule 12(e) provides that “[i]f a
pleading . . . is so vague or ambiguous that a party cannot reasonably be required to frame
a responsive pleading, the party may move for a more definite statement before
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
‘O’
Case No.
2:14-CV-09003-CAS (VBKx)
June 18, 2015
Title
ALEXANDER LEIBMAN v. ALEXANDER “SASHA” PRUPES
interposing a responsive pleading.” Such motions are usually denied given the liberal
pleading requirements of the Federal Rules, although they are more likely to be granted
“where the complaint is so general that ambiguity arises in determining the nature of the
claim or the parties against whom it is being made.” Sagan v. Apple Computer, Inc., 874
F. Supp. 1072, 1077 (C.D. Cal. 1994).
While the counterclaim in this case is “not always a model of clarity,” Bureerong
v. Uvawas, 922 F. Supp. 1450, 1462 (C.D. Cal. 1996), Leibman is not “literally [unable
to] frame a responsive pleading.” Hubbs v. Cnty. of San Bernardino, 538 F. Supp. 2d
1254, 1262 (C.D. Cal. 2008) (internal quotations omitted). In fact, he filed a cogent
motion to dismiss that addressed each of Prupes’s allegations in turn. See id. (denying a
motion for a more definite statement because “defendants’ motion to dismiss amply
demonstrates that defendants do understand the issues presented by the First Amended
Complaint”). Accordingly, the Court finds no need for a more definite statement.
V.
CONCLUSION
For the foregoing reasons, Leibman’s motion to dismiss is DENIED. Leibman is
directed to file an answer to the counterclaim by July 3, 2015.
IT IS SO ORDERED.
00
Initials of Preparer
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:
00
CMJ
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