Singh v. Baidwan

Filing 25

ORDER signed by Judge Lawrence K. Karlton on 6/4/14 ORDERING for the reasons set forth: 1. The breach of contract claim ("First Cause of Action") is DISMISSED in its entirety, with prejudice, under the "unclean hands" doctrine; 2. The remainder of this lawsuit is DISMISSED in its entirety, with prejudice, for lack of prosecution; and 3. The Clerk is DIRECTED to close this case. CASE CLOSED. (Meuleman, A)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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PAUL SINGH,

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No. CIV. S-14-00603 LKK/CKD
Plaintiff,

v.

ORDER

BHUPINDER BAIDWAN,
Defendant.

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The court has determined that this matter may be decided

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based upon the papers currently before the court, and without the

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need for oral argument.

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scheduled for June 23, 2014, is therefore VACATED.

The hearing on this motion, currently

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For the reasons set forth below, plaintiff’s breach of

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contract claim will be dismissed, with prejudice, under the

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unclean hands doctrine, and the remainder of his claims will be

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dismissed, with prejudice, for failure to prosecute.

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I.

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BACKGROUND

The allegations of the Complaint are set forth in this

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court’s order of May 13, 2014.

ECF No. 21.

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Complaint alleges that plaintiff Paul Singh and defendant
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In short, the

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Bhupinder Baidwan sought to deceive a lender into financing

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Singh’s purchase of a gas station, and to deceive BP Corporation

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into “assigning” the gas station (or the franchise) to plaintiff.

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They sought to do this by making defendant a straw buyer, since

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plaintiff did not qualify for the financing or the assignment on

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his own.

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were complete, defendant would transfer the gas station to

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plaintiff, upon plaintiff’s demand.

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Under the scheme, once the financing and assignment

Plaintiff asserts that defendant reneged on this scheme,

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refusing to turn over the gas station to him.

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comes here, asking a federal district court to enforce the

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scheme.

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II.

Plaintiff now

PROCEDURAL HISTORY

Defendant moved to dismiss all the claims as barred by the

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statute of limitations and the statute of frauds, and for failure

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to state a claim.

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“unclean hands” doctrine by name, although that doctrine fairly

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leaps from the allegations of the Complaint.

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nevertheless interprets defendant’s following argument to raise

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the issue of unclean hands:

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Defendant does not raise the defense of the

The court

Singh has openly admitted that the purpose of
the agreement was not only to defraud BP, but
also lenders.
Providing false financial
information to a franchisor and lender to
induce them into a contract is clearly an
illegal purpose and against public policy.

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ECF No. 6 at 13.

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the parties as [it] found them.”

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Cal. 3d 126, 138 (1985).

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Under that doctrine, this court would “leave
Wong v. Tenneco, Inc., 39

Plaintiff filed an “opposition” (ECF No. 16), that contained
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no opposition of any kind to defendant’s motion to dismiss for

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failure to state a claim.

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claims were not barred by the statute of limitations or the

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statute of frauds, he did not respond to defendant’s arguments

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that the Complaint failed to state a claim for breach of

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contract, “libel per se,” unjust enrichment, or any of the other

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claims in the Complaint.

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to address defendant’s arguments, and also to show why the court

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should not dismiss the complaint under the unclean hands

Although plaintiff argued that his

The court accordingly ordered plaintiff

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doctrine.

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properly declined to involve our courts in this flagrant effort

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to circumvent Mexican law”); California Crane School, Inc. v.

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National Commission for Certification of Crane Operators, 226

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Cal. App. 4th 12 (5th Dist. 2014) (discussing the doctrine).

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See Wong, 39 Cal. 3d at 134 (“[t]he trial court

Plaintiff has now filed an amended opposition.

ECF No. 22.

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The amended opposition argues that the court should not dismiss

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the complaint under the unclean hands doctrine, in order to avoid

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unjust enrichment of defendant.

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should not dismiss the breach of contract claim.

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It also argues that the court

III. ANALYSIS

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A.

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Plaintiff argues that the courts can enforce an illegal

Unclean Hands.

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contract when necessary to avoid unjust enrichment of the

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defendant.1

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plaintiff has not asserted that any of its cited cases authorizes

Even assuming this is so under California law,

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Plaintiff has labeled the claim one for breach of contract. However, the
relief sought is equitable in nature, namely, the compelled return of property
and profits, rather than contract damages.

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the court to enforce a scheme designed, as is apparently the case

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here, to defraud innocent third parties.

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According to the Complaint, plaintiff hatched this

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fraudulent scheme, recruited defendant and another to participate

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in it, and then found himself to be the victim when the defendant

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turned on him.

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them,” and will not participate in plaintiff’s attempt to defraud

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innocent third parties.

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Crane School ___ Cal. App. 4th ___, 2014 WL 1848297.

This court will “leave the parties as [it] found

See Wong, 39 Cal. 3d at 138; California
The breach

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of contract claim will be dismissed in its entirety, with

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prejudice.

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B.

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Plaintiff has not defended any of his other claims against

Other Claims.

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defendant’s assertions that they each fail to state a claim.

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Plaintiff asserts that it would be “a waste of time” for him to

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do so since he does not know whether the court will find the

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contract to be enforceable.

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rejects this excuse, as plaintiff has not explained, nor does it

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appear from the Complaint, why his “libel per se” claim, for

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example, is dependent on the outcome of the breach of contract

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claim.

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motion to dismiss his individual claims, once again.

See ECF No. 22 at 7.

The court

Plaintiff has simply failed to respond to defendant’s

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The court stated in its prior order that failure to address

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these arguments would result in a dismissal for failure to state

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a claim, with prejudice.

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dismissed with prejudice, for lack of prosecution.

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Accordingly, those claims will be

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III. CONCLUSION
For the reasons set forth above:
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The breach of contract claim (“First Cause of

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Action”) is dismissed in its entirety, with prejudice, under the

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“unclean hands” doctrine;

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2.

The remainder of this lawsuit is dismissed in its

entirety, with prejudice, for lack of prosecution; and
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The Clerk is directed to close this case.

IT IS SO ORDERED.
DATED:

June 4, 2014.

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