Martensen v. Koch

Filing 51

ORDER by Magistrate Judge Jacqueline Scott Corley granting in part and denying in part 39 Motion to Dismiss (ahm, COURT STAFF) (Filed on 4/30/2013)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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Northern District of California

United States District Court

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KIRBY MARTENSEN,

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Plaintiff,
v.

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Case No.: C-12-05257 JSC
ORDER GRANTING IN PART AND
DENYING IN PART DEFENDANT’S
MOTION TO DISMISS; DENYING
DEFENDANT’S MOTION TO
STRIKE

WILLIAM KOCH and DOES 1-25,
inclusive,
Defendant.

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This action involves the alleged false imprisonment of Kirby Martensen (“Plaintiff”) by

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William Koch (“Defendant”) and other unnamed parties. Now pending before the Court are

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Defendant’s motions to (1) dismiss Plaintiff’s First Amended Complaint (“FAC”) (i) under Rule

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12(b)(3) for improper venue, or in the alternative, to transfer the case under 28 U.S.C. § 1404(a); (ii)

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under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction; and (iii) under Rule

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12(b)(6) for failure to state a claim for relief; and (2) strike Plaintiffs’ punitive damages allegations

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under Federal Rule of Civil Procedure 12(f) (“Motions”). (Dkt. No. 39.) After carefully considering

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the parties’ pleadings on the Motions, and having the benefit of oral argument on April 25, 2013, the

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Court GRANTS in part and DENIES in part the Motion to Dismiss and DENIES the Motion to

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Strike.

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ALLEGATIONS OF THE FAC
Until March 22, 2012, Plaintiff, a resident of Berkeley, California, was an executive

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employee of companies owned and/or controlled by Defendant, including OxBow Carbon &

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Minerals, Inc. (“OCM”), and Oxbow Carbon & Minerals International (“OCM International”).

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OCM and OCM International sell a significant amount of petroleum coke and steam coal throughout

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Asia, shipping millions of metric tons of product to that region each year. In late 2011, Plaintiff was

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promoted to the position of Senior Vice President-Asia with OCM International, and relocated to

Northern District of California

OCM International’s Singapore office. Plaintiff came to believe that the company’s business efforts

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in Asia included implementing a plan to evade paying taxes to the United States on profits in excess

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of $200,000,000 per year.

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Sometime in 2011, Defendant was notified of an anonymous letter alleging that Plaintiff and

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another employee, Larry Black, had been engaging in theft, breaches of fiduciary duty, fraud, and

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self-dealing against the Oxbow companies. Based on this information, Defendant directed a

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comprehensive forensic review of thousands of documents, including the letters, memoranda, and

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electronic corporate communications of Plaintiff and several other employees. Defendant’s review

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of these communications revealed that Plaintiff and others had expressed concern over the legality of

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what they were doing on behalf of Oxbow and their distrust of upper management. As a result,

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Defendant promoted and implemented a plan to intimidate and discredit Plaintiff for the purpose of

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chilling his speech and damaging his credibility.

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In early 2012, Plaintiff and other executive employees of OCM International (Larry Black,

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Charlie Zhan, Joe Lombardi, Rich Ansley, and Bruce Taverner) were directed to attend a meeting

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with Defendant and others at Defendant’s property known as Bear Ranch located near Aspen,

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Colorado. Bear Ranch is accessible only through a private road owned and maintained by

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Defendant. The meeting was scheduled for March 21 and March 22, 2012.

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On the morning of March 21, 2012, Plaintiff flew directly from San Francisco to Aspen. He
arrived just before noon and was met at the airport by Defendant. After lunch in Aspen, Plaintiff,

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Defendant, and others drove to Bear Ranch to have dinner and spend the night. There was no cell

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phone reception or Wi-Fi connection at the ranch. “As a result, [Plaintiff] had no way to

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communicate with the outside world while he was at Bear Ranch.” (Dkt. No. 38 ¶ 18.)

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The next morning, Plaintiff and the other guests had breakfast at the ranch followed by a

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business meeting. Defendant then invited Plaintiff and the other guests to tour his nearby western

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town—a collection of approximately 50 buildings designed to replicate an authentic late-19th

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century western town. This was followed by a helicopter tour of the ranch and a lunch hosted by

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Defendant in one of the town’s meeting rooms.

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Following lunch, Defendant told Plaintiff and the others that they would be interviewed by a

Northern District of California

compensation specialist as part of a 360-degree peer review. Plaintiff was then escorted to a small

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room and interviewed “by two agents of [Defendant]” for several hours. (Id. at ¶ 20.) Plaintiff was

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accused of participating in a wide-ranging scheme to defraud Oxbow and Defendant of millions of

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dollars, accepting bribes from competitors, and diverting freight to a known competitor. “These

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accusations were based on [Plaintiff’s] alleged misconduct primarily when he worked for Oxbow

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Carbon & Minerals in Pleasant Hill, California and lived in Berkeley, California.” (Id.)

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After this confrontation, at around 5:00 p.m., Plaintiff was escorted to an SUV and directed

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to sit in the back. Just outside the western town the vehicle stopped, the windows were rolled down,

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and Plaintiff was served with his termination papers and a lawsuit. As the vehicle returned to the

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ranch, Plaintiff asked where he was being taken. The driver told him that he would be taken to

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Aspen. Plaintiff was then driven to the main house on the ranch to collect his belongings.

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When collecting his belongings, “[a]n agent of [Defendant]” searched his suitcase and

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toiletries. (Id. ¶ 19.) Plaintiff was then escorted to an SUV and driven to a nearby cabin on the

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ranch, where he was escorted into the cabin. While escorting Plaintiff to the cabin, the driver told

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Plaintiff that “a sheriff is here to make sure you don’t wander off.” (Id.) Plaintiff observed a

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marked police vehicle parked nearby with a man in uniform behind the wheel. The police vehicle

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was clearly visible from the window of the room in which Plaintiff was kept.

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After three hours of “being confined,” (id. ¶ 23), Plaintiff was told to collect his things and
that he would be taken to an airport. “Agents of [Defendant]” directed Plaintiff to get back in the

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SUV with a former co-worker, Charlie Zahn, while “two agents of [Defendant] sat up front.” (Id.)

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Plaintiff asked to be driven to Aspen, which is 69.3 miles from Bear Ranch, because he had a

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scheduled flight from Aspen to San Francisco the next morning. This request was denied. Plaintiff

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was told that he was being taken to Denver, which is 228 miles from Bear Ranch. Plaintiff

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complained and stated that he wanted to go to Aspen.

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Plaintiff was driven to a small private airport in the Denver area. Once at the airport,

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“[Defendant’s] agents” escorted Plaintiff to a private plane and ordered Plaintiff and Zahn to board

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the plane. (Id. at ¶ 24.) “[Plaintiff] is informed and believes and thereupon alleges that the plane

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was owned or controlled by [Defendant].” (Id.) It was now approximately 2:00 a.m. on March 23,

Northern District of California

2012. The private jet was manned by a pilot, co-pilot, and an escort Plaintiff believed was armed, all

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of whom were “agents of [Defendant].” (Id.) The plane landed in Oakland, California at

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approximately 4:00 a.m. On arrival Plaintiff was told that a car was waiting to take him to a nearby

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Marriot Courtyard Hotel. Plaintiff refused the request and asked an airport employee to call a cab.

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A cab arrived and Plaintiff left.

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Regarding the involvement of the sheriff in the false imprisonment, Plaintiff alleges that a

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Colorado Bureau of Investigations report following the alleged incident at the ranch “confirm[s] that

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the Sheriff’s deputies, Deputy Clarence Hart and Deputy Mike Smith, . . . were acting as Koch’s

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agents.” (Id. at 38 ¶ 26.) Deputy Smith sometime in March 2012 asked Deputy Hart if he would be

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interested in doing a “security job” at Bear Ranch. (Id. at 38 ¶ 28 (quotation marks omitted).)

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Deputy Smith had been approached to do the job, but he was scheduled to be on duty that day.

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Deputy Smith told Deputy Hart that Defendant was going to fire some employees, and he wanted a

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law enforcement presence “in case things got out of control.” (Id. (quotation marks omitted).)

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Deputy Hart accepted the job. When he arrived at the ranch in his patrol vehicle, a man he believed

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to be the ranch manager named Rob Gill told Deputy Hart he would be paid $50.00 per hour.

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Deputy Hart was at the ranch for 10 hours that day, from 10:00 a.m. to 8:00 p.m. He received a

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$500.00 check at the end of the day. Deputy Hart was directed to park behind a cabin near the main

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office. Deputy Hart observed two people being escorted to the cabin that day, and at the time he

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thought they may have been terminated employees. There was a “whole security detail from

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Florida” present on the ranch that day. (Id.) Deputy Hart estimated eight to nine men were on the

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security detail.

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Robert Gill, “who has been described as the Bear Ranch manager and is an agent of Koch,”

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told Deputy Smith that on the day the executives were going to be fired, the phone service and

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Internet access at the ranch would be turned off so “these guys couldn’t uh, couldn’t communicate

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outside until they were totally done.” (Id. at ¶ 29 (quotation marks omitted).) On the day Deputy

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Hart performed the security job at the ranch, Deputy Smith spent a lot of time patrolling in that area.

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Deputy Smith said Koch had his own “kind of like secret service type” personnel on the ranch that

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day. (Id. (quotation marks omitted).)

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Northern District of California

United States District Court

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On October 11, 2012, Plaintiff filed suit against Defendant, alleging three causes of action: 1)
false imprisonment; 2) civil conspiracy; and 3) conspiracy under 42 U.S.C. § 1983.

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DISCUSSION
A.

Personal Jurisdiction
When a defendant moves to dismiss for lack of personal jurisdiction, the plaintiff bears the

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burden of demonstrating that the court has jurisdiction over the defendant. See Harris Rutsky & Co.

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Ins. Servs., Inc. v. Bell & Clements Ltd., 328 F.3d 1122, 1128-29 (9th Cir. 2003). However, this

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demonstration requires that the plaintiff “make only a prima facie showing of jurisdictional facts to

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withstand the motion to dismiss.” Doe v. Unocal, 248 F.3d 915, 922 (9th Cir. 2001) (internal

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citations omitted). In such cases, “we only inquire into whether [the plaintiff’s] pleadings and

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affidavits make a prima facie showing of personal jurisdiction.” Caruth v. Int’l Psychoanalytical

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Ass’n, 59 F.3d 126, 128 (9th Cir. 1995). Moreover, “for the purpose of this demonstration, the court

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resolves all disputed facts in favor of the plaintiff.” Pebble Beach Co. v. Caddy, 453 F.3d 1151,

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1154 (9th Cir. 2006).

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“Where, as here, no federal statute authorizes personal jurisdiction, the district court applies

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the law of the state in which the court sits.” Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218,

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1223 (9th Cir. 2011). California’s long-arm statute has the same due process requirements as the

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federal long-arm statute. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 801 (9th Cir.

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2004). The Due Process Clause requires that nonresident defendants have “minimum contact” with

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the forum state such that the exercise of personal jurisdiction “does not offend traditional notions of

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fair play and substantial justice.” Int’l Shoe Co. v. State of Wash., Office of Unemployment Comp. &

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Placement, 326 U.S. 310, 316 (1945).

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General Jurisdiction

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Plaintiff argues that California has general jurisdiction over Defendant, a Florida resident.

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The Court disagrees. For general jurisdiction to exist over a nonresident defendant such as Koch,

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the defendant must engage in “continuous and systematic general business contacts,” Helicopteros

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Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984), that “approximate physical

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presence” in the forum state. Bancroft & Masters, Inc. v. Augusta Nat. Inc., 223 F.3d 1082, 1086

Northern District of California

(9th Cir. 2000). “This is an exacting standard, as it should be, because a finding of general

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jurisdiction permits a defendant to be haled into court in the forum state to answer for any of its

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activities anywhere in the world.” Schwarzenegger, 374 F.3d at 801; see also Brand v. Menlove

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Dodge, 796 F.2d 1070, 1073 (9th Cir. 1986) (collecting cases where general jurisdiction was denied

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despite defendants’ significant contacts with forum).

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The essence of Plaintiff’s general jurisdiction argument is that to the extent any Oxbow entity

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is found to have continuous and systematic general business contacts with California, those contacts

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should be imputed to Defendant as the owner and ultimate authority of the Oxbow entities. 1

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Plaintiff provides no authority to support this proposition. In fact, the caselaw suggests that such a

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rule is untenable. “[J]urisdiction over an employee does not automatically follow from jurisdiction

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over the corporation which employs him; nor does jurisdiction over a parent corporation

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automatically establish jurisdiction over a wholly owned subsidiary.” Keeton v. Hustler Magazine,

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Inc., 465 U.S. 770, 781 n.13 (1984). Rather, “[e]ach defendant’s contacts with the forum State must

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be assessed individually.” Id. At the same time, courts have held in the context of specific

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jurisdiction that the corporate form does not protect an individual acting in his official capacity in

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two cases: “(1) where the corporation is the agent or alter ego of the individual defendant, Flynt

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Distrib. Co. v. Harvey, 734 F.2d 1389, 1393 (9th Cir. 1984); or (2) by virtue of the individual’s

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Plaintiff’s Opposition to the present motion purports to “incorporate . . . by reference” his
arguments regarding jurisdiction made in opposition to the initial motion to dismiss. (Dkt. No. 45 at
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control of, and direct participation in the alleged activities, Transgo, Inc. v. Ajac Transmission Parts

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Corp., 768 F.2d 1001, 1021 (9th Cir. 1985).” Wolf Designs, Inc. v. DHR Co., 322 F. Supp. 2d 1065,

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1072 (C.D. Cal. 2004); see also Keeton, 465 U.S. at 781 n.13 (“[W]e today reject the suggestion that

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employees who act in their official capacity are somehow shielded from suit in their individual

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capacity.”). Here, Plaintiff does not allege that Defendant was acting in his official capacity when

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he injured Plaintiff, so Oxbow’s activities in California are irrelevant in determining whether the

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Court has personal jurisdiction over Defendant for actions taken in his individual capacity. In

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addition, Plaintiff does not allege that Oxbow is the agent or alter ego of Defendant. Accordingly,

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even if an Oxbow entity is subject to general jurisdiction in California, it does not follow that

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Northern District of California

United States District Court

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Defendant is also subject to such jurisdiction.
The remaining bases Plaintiff offers for the exercise of general jurisdiction over Defendant

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are insufficient. Plaintiff contends that Defendant makes “periodic visits” to Oxbow offices in

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Pleasant Hill, California and Long Beach, California. (Dkt. No. 26 at 7.) As Defendant asserts, such

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occasional contacts do not establish general jurisdiction. See Span Constr. & Eng’g, Inc. v.

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Stephens, 2006 WL 1883391 *6 (E.D. Cal. Jul. 7, 2006) (“In case after case, when an individual

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conducts business that requires their occasional presence in a state, courts have not found sufficient

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contact for general jurisdiction.”). Further, Defendant’s filling of an unrelated lawsuit in California

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in 2009 may not even be considered in the jurisdictional analysis. See Core-Vent Corp. v. Nobel

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Indus. AB, 11 F.3d 1482, 1490 (9th Cir. 1993) (filing unrelated action in forum does not subject

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defendant to personal jurisdiction in forum); Tercica, Inc. v. Insmed Inc., 2006 WL 1626930 *12

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(N.D. Cal. Jun. 9, 2006) (“[I]t is clear from Core-Vent that unrelated litigation in a forum state is not

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a controlling factor in, or even relevant to, the general jurisdictional analysis.”)

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Because Plaintiff’s Complaint and declarations submitted in support of his assertion of

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general jurisdiction fail to make the required prima facie showing, the Court finds that general

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jurisdiction over Defendant does not exist.

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2.

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Alternatively, Plaintiff argues that Defendant has sufficient “minimum contacts” with

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Specific Jurisdiction

California arising from his actions in falsely imprisoning Plaintiff such that the forum may assert

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specific personal jurisdiction. The Ninth Circuit employs a three-prong test (“Minimum Contact

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Test”) to determine whether a party has sufficient minimum contacts to be susceptible to specific

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jurisdiction:

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1) The non-resident defendant must purposefully direct his activities or consummate
some transaction with the forum, or resident thereof; or perform some act by which he
purposefully avails himself of the privilege of conducting activities in the forum,
thereby invoking the benefits and protections of its laws;

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2) the claim must be one which arises out of or relates to the defendant’s forum-related
activities; and

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3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it
must be reasonable.

Northern District of California

Schwarzenegger, 374 F.3d at 802; Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1288

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(9th Cir. 1977). The plaintiff bears the burden of satisfying the first two prongs of this test. Id. If

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the plaintiff satisfies this burden, the burden shifts to the defendant to make a “compelling case” that

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the third prong—the exercise of jurisdiction is reasonable—is not met. Burger King Corp. v.

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Rudzewicz, 471 U.S. 462, 476-78 (1985). “If any of the three requirements is not satisfied,

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jurisdiction in the forum would deprive the defendant of due process of law.” Pebble Beach Co.,

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453 F.3d at 1155 (internal citations and quotations omitted). For purposes of personal jurisdiction,

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the actions of an agent are attributable to the principal. See Wells Fargo & Co. v. Wells Fargo

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Express Co., 556 F.2d 406, 419 (9th Cir. 1977).

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The first prong of the minimum contact test “ensures that a defendant will not be haled into a

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jurisdiction solely as a result of random, fortuitous, or attenuated contacts, or of the unilateral

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activity of another party or a third person.” Burger King, 471 U.S. at 475 (internal citations and

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quotations omitted). Under this prong, Plaintiff must establish that Defendant either purposefully

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availed himself of the privilege of conducting activities in California, or purposefully directed his

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activities toward California. “A showing that a defendant purposefully availed himself of the

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privilege of doing business in a forum state typically consists of evidence of the defendant’s actions

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in the forum, such as executing or performing a contract there.” Schwarzenegger, 374 F.3d at 802

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(emphasis added). By taking such actions, a defendant “purposefully avails itself of the privilege of

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conducting activities within the forum State, thus invoking the benefits and protections of its laws.”

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Id. (internal quotation marks omitted). “A showing that a defendant purposefully directed his

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conduct toward a forum state, by contrast, usually consists of evidence of the defendant’s actions

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outside the forum state that are directed at the forum, such as the distribution in the forum state of

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goods originating elsewhere.” Id. at 803 (emphasis added). Purposeful direction allows a defendant

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to be haled into the forum notwithstanding a lack of any physical contacts with the forum. See Core-

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Vent, 11 F.3d at 1485 (“[W]ithin the rubric of purposeful availment the [Supreme] Court has allowed

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the exercise of jurisdiction over a defendant whose only contact with the forum state is the

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purposeful direction of a foreign act having effect in the forum state.”) (emphasis original) (internal

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quotation marks omitted).

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If purposeful direction is the proper mode of analysis, courts in the Ninth Circuit apply the

Northern District of California

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three-part “effects” test traceable to the Supreme Court’s decision in Calder v. Jones, 465 U.S. 783

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(1984). Id. The Ninth Circuit has described Calder and its three-part test as follows:

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Calder stands for the proposition that purposeful availment is satisfied even by a
defendant “whose only ‘contact’ with the forum state is the ‘purposeful direction’ of a
foreign act having effect in the forum state.” . . . [Under] Calder, the “effects” test
requires that the defendant allegedly have (1) committed an intentional act, (2)
expressly aimed at the forum state, (3) causing harm that the defendant knows is likely
to be suffered in the forum state.
Id. (alterations original).
Despite the distinction between activities in the forum state and activities outside the forum

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state drawn by Schwarzenegger and found earlier in Core-Vent, subsequent Ninth Circuit cases have

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cited Schwarzenegger for the proposition that “[i]n tort cases, we typically inquire whether a

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defendant ‘purposefully direct[s] his activities’ at the forum state, applying an ‘effects’ test that

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focuses on the forum in which the defendant’s actions were felt, whether or not the actions

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themselves occurred within the forum.” Yahoo! Inc. v. La Ligue Contre Le Racisme Et

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L’Antisemitisme, 433 F.3d 1199, 1206 (9th Cir. 2006) (en banc) (quoting Schwarzenegger, 374 F.3d

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at 803 (alterations in original)) (emphasis added); Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d

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1218, 1228 (9th Cir. 2011) (quoting same). However, the Court finds no case that applied the

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“effects” test when the tort occurred in the forum, including Yahoo and Mavrix, which both

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concerned an act that was committed outside the forum. See Yahoo, 433 F.3d at 1209 (analyzing

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under “effects” test “intentional act” of filing suit in French court that was expressly aimed at

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California); Mavrix, 647 F.3d at 1229 (applying “effects” test to an Ohio company’s posting of

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allegedly infringing photos that were expressly aimed at California). 2

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Instead, the “effects” test appears unnecessary where, as here, part of the alleged tort

1058, 1064 (9th Cir. 1986) (“The commission of an intentional tort in a state is a purposeful act that

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will satisfy the first two requirements under Data Disc.”); see also Olsen by Sheldon v. Gov’t of

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Mexico, 729 F.2d 641, 649 (9th Cir. 1984) (finding that in claims arising from a plane’s flight and

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crash in California the first two prongs of the Data Disc test were “easily satisfied” where pilot of

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aircraft in distress twice intentionally entered California airspace thereby “purposefully avail[ing]

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Northern District of California

occurred in California. See Paccar Intern., Inc. v. Commercial Bank of Kuwait, S.A.K., 757 F.2d

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United States District Court

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itself of the benefits of operating its aircraft over California”), abrogated on other grounds by Joseph

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v. Office of Consulate Gen. of Nig., 830 F.2d 1018, 1026 (9th Cir. 1987); MMCA Group, Ltd. v.

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Hewlett-Packard Co., 2007 WL 1342586 at *7 (N.D. Cal. May 8, 2007) (“When a nonresident

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defendant commits a tort within the state . . . that tortious conduct amounts to sufficient minimum

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contacts with the state by the defendant to constitutionally permit courts within that state . . . to

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exercise personal adjudicative jurisdiction . . . .”) (quoting Guidry v. U.S. Tobacco Co., Inc., 188

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F.3d 619, 628 (5th Cir. 1999)); In re Auto. Antitrust Cases I & II, 135 Cal. App. 4th 100, 123 (2005)

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(“California courts may properly exercise personal jurisdiction over one who commits a tort or who

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causes a tort to be committed within this state.”); Skidmore Energy, Inc. v. Maghreb Petroleum

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Exploration, S.A., 337 Fed. Appx. 706 at *1 (9th Cir. 2009) (unpublished) (evaluating personal

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jurisdiction based on an allegation of an in-state tort “[e]ffects test aside”).
This also appears to be Defendant’s understanding. Defendant states that the “effects test” is

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applied to determine whether a nonresident defendant purposefully directed his tortious activity to

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Courts have stated that “[a] purposeful availment analysis is most often used in suits sounding in
contract,” Schwarzenegger, 374 F.3d at 802, while a purposeful direction analysis “is most often
used in suits sounding in tort,” id. However, this frequency may simply result from the fact that
defendants in cases where the alleged tort is committed outside the forum (purposeful direction
analysis) challenge personal jurisdiction more often than defendants in cases where the tort is
committed in the forum (purposeful availment analysis) since, as noted below, torts committed in the
forum typically satisfy the minimum contacts requirement.

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the forum, “[i]n the absence of tortious conduct occurring in the forum.” (Dkt. No. 39 at 17.) Thus,

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notwithstanding Ninth Circuit cases suggesting to the contrary, the Court concludes that the “effects”

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test is unnecessary where the defendant has committed tortious acts within the forum that form the

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basis of the plaintiff’s claim.

committed the tort of false imprisonment within the forum satisfy the prima facie requirement for

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personal jurisdiction. Although Plaintiff’s FAC does not allege that Defendant directly participated

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in the false imprisonment, it includes facts that support an inference that the persons who did

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perpetrate the tort were acting as Defendant’s agents. The false imprisonment began on Defendant’s

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private ranch, where Defendant had earlier in the day hosted Plaintiff and others for lunch. Plaintiff

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Northern District of California

The Court has little difficulty concluding that Plaintiff’s allegations that Defendant

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United States District Court

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contends his false imprisonment followed Defendant’s realization that Plaintiff had discovered

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Defendant’s tax fraud; further, the false imprisonment was immediately preceded by Defendant’s

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accusation that Plaintiff had embezzled money from Defendant’s companies. Moreover, the

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unknown individuals who falsely imprisoned Plaintiff used buildings and vehicles located on

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Defendant’s private property to commit the alleged tort. In addition, Plaintiff alleges that the false

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imprisonment continued unbroken as he was driven from the ranch to an airport in Denver and

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ordered onto a private plane (alleged to be owned or controlled by Defendant) at 2:00 a.m. and flown

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to Oakland. Taken together, these facts lead to the plausible inference that those unnamed

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individuals who falsely imprisoned Plaintiff were doing so as Defendant’s agents, and these agents

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continued the false imprisonment onto Defendant’s plane and into the forum.

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Defendant’s proposed inference—that the plane was chartered and controlled by “any of

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numerous other Oxbow employees (or other individuals),” (Dkt. No. 47 at 11)—while perhaps also

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plausible, ignores the reasonable inference from the facts alleged that the Court must draw in

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Plaintiff’s favor. It is logical to conclude that Plaintiff’s false imprisonment that began on

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Defendant’s private ranch by Defendant’s agents and continued unbroken until Plaintiff’s release in

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Oakland was conducted and overseen by the same person. It is further reasonable to infer that that

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person was Defendant.

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At the hearing, Defendant asserted that although he directed the activities leading up to the

embezzlement, Plaintiff’s firing, etc.—it is not reasonable to infer that he also directed the actions

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comprising the false imprisonment allegations. Defendant reasons that those activities are not within

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the scope of reasonable actions an employer would take to maintain safety following the termination

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of an employee. The Court is not persuaded. Whether the actions alleged in the FAC amount to

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false imprisonment or merely reasonable actions taken by an employer to insure safety is not the

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inquiry for personal jurisdiction purposes. Rather, the question is whether it is plausible to infer that

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those persons committing the alleged actions in the forum were acting as Defendant’s agents. In

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addition, Defendant’s argument would require this Court to make determinations on the merits of

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Northern District of California

alleged false imprisonment—the weekend retreat, the interview concerning Plaintiff’s alleged

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United States District Court

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this case—whether the facts alleged establish false imprisonment. The Court declines to make such

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determinations in light of Plaintiff’s prima facie showing of personal jurisdiction. See Data Disc,

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557 F.2d at 1289 n.6 (finding that where jurisdictional issues are intertwined with the merits and the

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plaintiff has made a prima facie showing, “it may be appropriate” to defer resolution of those issues

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until summary judgment or trial).

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Because Plaintiff has adequately alleged that Defendant committed the tort of false

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imprisonment within the forum, the Court accordingly finds that Plaintiff has made a prima facie

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showing of minimum contacts needed to establish personal jurisdiction.

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B.

Venue

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1.

Whether Venue is Proper in the Northern District

21

A civil action may be brought in “a judicial district in which a substantial part of the events

22

or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of

23

the action is situated.” 28 U.S.C. § 1391(b)(2). Once the propriety of venue is challenged pursuant

24

to Rule 12(b)(3), the plaintiff bears the burden of proving that venue is proper. Piedmont Label Co.

25

v. Sun Garden Packing Co., 589 F.2d 491, 496 (9th Cir. 1979). When considering a motion to

26

dismiss for improper venue, a court need not accept the pleadings as true and may consider facts

27

outside of the pleadings. Doe 1 v. AOL, LLC, 552 F.3d 1077, 1081 (9th Cir. 2009). “[T]he court

28

must draw all reasonable inferences in favor of the non-moving party and resolve all factual conflicts

12

1

in favor of the non-moving party.” Ctr. For Food Safety v. Vilsack, 2011 WL 996343, at *2 (N.D.

2

Cal. Mar. 17, 2011). If the court finds venue is improper, it has discretion to dismiss or to transfer

3

venue to a proper court. Omnicell, Inc. v. Medacist Solutions Grp., LLC, 272 F.R.D. 469, 473 (N.D.

4

Cal. 2011) (internal citations omitted). Venue must be established as to each claim. Boudouin v.

5

Dep’t of Navy, 2010 WL 890042, at *2 (N.D. Cal. Mar. 8, 2010).

6
7

a.

False imprisonment claim

Defendant argues that venue is improper in this District because the part of the false

8

imprisonment that occurred in California does not constitute a “substantial part of the events or

9

omissions giving rise to the claim.” The Court disagrees. Defendant cites no similar case where the

Northern District of California

cause of action itself occurred within the forum yet the forum was improper under Section 1391.

11
United States District Court

10

Rather, Defendant’s authority stands for the undisputed proposition that “[s]ubstantiality is measured

12

by considering the nexus between the events and the nature of the claims; [that is,] significant events

13

or omissions material to the plaintiff’s claim must have occurred in the district in question, even if

14

other material events occurred elsewhere.” Lee v. Corr. Corp. of Am., 525 F. Supp. 2d 1238, 1241

15

(D. Haw. 2007). In Lee, the court rejected the plaintiff’s argument that venue was proper in Hawaii

16

“because significant events leading up to his claims took place in Hawaii.” 525 F. Supp. 2d at 1242

17

(emphasis added). Instead, the torts the plaintiff complained of all occurred in Mississippi; no tort

18

was committed in Hawaii. Id. Here, however, the tort occurred in this District as well as in

19

Colorado.

20

Defendant’s reliance on Daniel v. American Board of Emergency Medicine, 428 F.3d 408 (2d

21

Cir. 2005) is equally unavailing. The plaintiffs in Daniel brought antitrust claims against the

22

defendant, ABEM, which were based in part on ABEM’s rejections of plaintiffs’ applications to take

23

its certification exam. 428 F.3d at 434. Although the decision to reject plaintiffs’ applications

24

occurred in Michigan, plaintiffs argued that venue was proper in the Western District of New York

25

because six of the 176 named plaintiffs received rejection letters in the District. Id. The court

26

rejected plaintiffs’ argument, finding that such “coincidental contacts” with the forum did not

27

constitute a “substantial part” of plaintiffs’ antitrust claims. Id. The court’s reasoning was

28

supported by its stated principle that “[w]hen material acts or omissions within the forum bear a

13

1

close nexus to the claims, they are properly deemed ‘significant’ and, thus, substantial, but when a

2

close nexus is lacking, so too is the substantiality necessary to support venue.” Id. at 433. While

3

ABEM’s rejection notice to six of the 176 named plaintiffs did not bear a close nexus to the

4

plaintiffs’ antitrust claims, Defendant’s actions here in the forum not only bear a close nexus to the

5

claim, they are part of the claim.

6

In addition, Gaston v. Harris County, 2012 WL 787202 (D. Or. Jan. 23, 2012) is

including companies such as Google, Inc., Lexis–Nexis Group, municipalities such as Harris County

9

and Travis County (both in Texas) and New York City, the United States, and a number of federal

10

agencies and officials, including the U.S. Department of Treasury, Federal Bureau of Investigation,

11
Northern District of California

distinguishable. Gaston, proceeding pro se, filed a complaint against approximately 50 defendants,

8

United States District Court

7

and the Central Intelligence Agency. Gaston, 2012 WL 787202 at *1. The misconduct described in

12

Gaston’s complaint involved his allegedly discriminatory firing from his job in Texas, followed by

13

the defendants’ coordinated efforts to, among other things, defame Gaston through internet articles,

14

stalk and harass him in the community, and attempt to murder him. “These activities led Gaston in

15

September 2011 to flee Texas and travel around the country in his car seeking safety. Defendants

16

allegedly pursued him into Arizona, California, and finally Oregon, where they ‘tried to pay off a

17

street thug to harass [Gaston] or hurt him.’” Id. (alteration in original). The court found venue in

18

Oregon lacking because “[c]ompared with the numerous other alleged severe violations arising from

19

events in Texas and Arizona spanning a number of years, th[e] single allegation concerning Oregon

20

is wholly insignificant to establish venue in this district.” Id. at *3. Unlike Gaston, Plaintiff is not

21

alleging a series of disconnected and fanciful events conducted by a range of corporations and local

22

governments and federal agencies that eventually concluded in the forum. Rather, Plaintiff has

23

alleged that Defendant committed the tort of false imprisonment, which simply began in one forum

24

and ended in another.

25

That the majority of the false imprisonment occurred in Colorado is of no moment. Section

26

1331 requires only that a “substantial” part of the events giving rise to the claim occur in the forum,

27

not a majority of the events. Defendant’s own cited authority stands for the same proposition. See

28

Daniel, 428 F.3d at 432-33 (“‘Substantiality’ for venue purposes is more a qualitative than a

14

1

quantitative inquiry, determined by assessing the overall nature of the plaintiff’s claims and the

2

nature of the specific events or omissions in the forum, and not by simply adding up the number of

3

contacts.”). Moreover, the continuation of the tort into California is significant. Plaintiff alleges that

4

he asked to be returned to Aspen where he had a scheduled flight back to California the next day;

5

however, Defendant’s agents denied Plaintiff’s request and drove him that night over 200 miles to

6

Denver and placed him on a private plane at 2:00 a.m. destined for Oakland. Based on the

7

allegations, it can be inferred that transporting Plaintiff to California—and insuring he did not

8

remain free in Colorado—was a motive, if not the motive, giving rise to the alleged false

9

imprisonment.

10

The Court also rejects Plaintiff’s argument that venue is proper in this District because a

Northern District of California

United States District Court

11

substantial part of Plaintiff’s continuing harm is suffered by Plaintiff here at his home. While it is

12

true that “[i]n a tort action, the locus of the injury [is] a relevant factor” in making a venue

13

determination, Fiore v. Walden, 688 F.3d 558, 587 (9th Cir. 2012); see also Myers v. Bennett Law

14

Offices, 238 F.3d 1068, 1076 (9th Cir. 2011), Plaintiff provides no support for the proposition that

15

the relevant injury resulting from false imprisonment may continue indefinitely into the future. The

16

harm incurred in being falsely imprisoned occurs during the commission of the tort; the confinement

17

and loss of freedom harms the victim immediately. This is not a situation, as in Myers, where a tort

18

is committed in one location away from the victim, but the harm is not felt until sometime later in a

19

different location. See Myers, 238 F.3d at 1073-74, 1076 (finding that alleged FCRA violation,

20

which is akin to an invasion of privacy tort, that occurred outside Nevada injured plaintiffs at their

21

Nevada home because such privacy invasions result in mental distress experienced where the

22

plaintiff lives).

23
24

b.

Section 1983 claim

Venue is not proper as to Plaintiff’s Section 1983 claim. The substantial events giving rise to

25

this claim—the agreement between the deputies and Defendant; Deputy Hart’s presence on the

26

ranch—all occurred in Colorado. Plaintiff makes no allegation that any deputy was involved in

27

returning him to California.

28

15

1

Nonetheless, the Court exercises pendent venue over the Section 1983 claim. While the

2

Ninth Circuit does not appear to have addressed the issue, courts in this District have applied the

3

pendent venue doctrine, which holds that if venue is proper on one claim, the court may find pendent

4

venue for claims that are closely related. See Legal Additions LLC v. Kowalski, 2009 WL 1226957,

5

at *11 (N.D. Cal. Apr. 30, 2009); McNeary-Calloway v. JP Morgan Chase Bank, N.A., 863 F. Supp.

6

2d 928, 965 (N.D. Cal. 2012); see also Beattie v. United States, 756 F.2d 91, 100–04 (D.C. Cir.

7

1984), overruled on other grounds in Smith v. United States, 507 U.S. 197 (1993). A court may

8

consider the principles of judicial economy, convenience, avoidance of piecemeal litigation, and

9

fairness to the litigants in making its decision. See Legal Additions LLC, 2009 WL 1226957 at *11;

Northern District of California

McNeary-Calloway, 863 F. Supp. 2d at 965. These are the same factors the Ninth Circuit has

11
United States District Court

10

directed courts to consider when evaluating whether to apply the doctrine of pendent personal

12

jurisdiction. See Action Embroidery Corp. v. Atl. Embroidery, Inc., 368 F.3d 1174, 1181 (9th Cir.

13

2004) (“When a defendant must appear in a forum to defend against one claim, it is often reasonable

14

to compel that defendant to answer other claims in the same suit arising out of a common nucleus of

15

operative facts. . . . “[T]he district court may have discretion to dismiss the pendent claims where

16

considerations of judicial economy, convenience and fairness to litigants so dictate.”) (alteration in

17

original) (internal quotation marks omitted).

18

Defendant has not argued why granting pendent venue would lessen judicial economy,

19

convenience, and the fairness to the litigants. Further, because the Section 1983 claim is brought

20

against only Defendant, and the claim encompasses many of the same events that comprise

21

Plaintiff’s false imprisonment claim, the Court finds that exercise of pendent venue is warranted.

22

Because a portion of the tort that is the basis of the lawsuit occurred in this District, the Court

23

has little difficulty concluding that a “substantial part” of the events giving rise to Plaintiff’s claim

24

occurred in this District. Defendant’s motion to dismiss for improper venue is accordingly denied.

25

2.

Section 1404(a) Transfer

26

Even if a court finds that venue is proper, it has discretion to transfer a case to another district

27

pursuant to 28 U.S.C. section 1404(a). That statute provides: “For the convenience of parties and

28

witnesses, in the interest of justice, a district court may transfer any civil action to any other district

16

1

or division where it might have been brought or to any district or division to which all parties have

2

consented.” 28 U.S.C. § 1404(a). When a defendant moves for a 1404(a) transfer, the defendant

3

bears the burden to show that transfer is appropriate. Commodity Futures Trading Comm’n v.

4

Savage, 611 F.2d 270, 279 (9th Cir. 1979).

5

“A motion to transfer venue under § 1404(a) requires the court to weigh multiple factors in

6

its determination whether transfer is appropriate in a particular case.” Jones v. GNC Franchising,

7

Inc., 211 F.3d 495, 498 (9th Cir. 2000). In particular, the Court should consider (1) the plaintiff’s

8

choice of forum; (2) the convenience of the parties; (3) the convenience of the witnesses; (4) ease of

9

access to evidence; (5) familiarity of each forum with applicable law; (6) feasibility of consolidation

Northern District of California

of other claims; (7) any local interest in the controversy; and (8) the relative court congestion and

11
United States District Court

10

time to trial in each forum. Ctr. For Biological Diversity & Pac. Env’t v. Kempthorne, 2007 WL

12

2023515 at *3 (N.D. Cal. July 12, 2007).

13

Typically the defendant must make a strong showing that transfer is appropriate to warrant

14

upsetting the plaintiff’s choice of forum. Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d

15

834, 843 (9th Cir. 1986) (internal citations omitted); see also Ctr. for Biological Diversity & Pac.

16

Env’t, 2007 WL 2023515 at *3 (stating that unless the balance of factors weighs heavily in favor of

17

the defendants, “the plaintiff’s choice of forum should rarely be disturbed”) (internal citations

18

omitted). Moreover, “a plaintiff’s choice of forum is entitled to greater deference when the plaintiff

19

has chosen the home forum.” Piper Aircraft Co. v. Reyno, 454 U.S. 235, 255 (1981). However,

20

“[i]f the operative facts have not occurred within the forum of original selection and that forum has

21

no particular interest in the parties or the subject matter, the plaintiff’s choice is entitled only to

22

minimal consideration.” Id. (internal quotation marks and citation omitted). “The degree to which

23

courts defer to the plaintiff’s venue choice is substantially reduced where the plaintiff’s venue choice

24

is not its residence or where the forum lacks a significant connection to the activities alleged in the

25

complaint.” Id. (internal quotation marks and citation omitted).

26

Defendant moves to transfer venue to the District of Colorado. Having considered the

27

factors set forth above, the Court finds that transfer is a close question. However, given that it is

28

Defendant’s burden, the Court concludes that Defendant has not demonstrated that a transfer to

17

choice of forum should be given reduced consideration relies on his mistaken belief that the

3

wrongdoing alleged to have occurred in this District is inconsequential. Thus, Defendant has not

4

made the strong showing that Plaintiff’s choice of his home forum should be disturbed. Second, the

5

Court is aware that the balance of the events giving rise to this lawsuit occurred in Colorado;

6

however, Defendant has not shown that the bulk of witnesses remain there. Although the two

7

sheriff’s deputies that were involved in Defendant’s security operation reside in Colorado, the

8

“whole security detail from Florida” comprising eight to nine men—those Plaintiff alleges are

9

Defendant’s agents—appear to reside in Florida, not Colorado. (Dkt. No. 38 ¶ 28.) Thus, for the

10

majority of witnesses, the District of Colorado may be only marginally more convenient, if at all,

11
Northern District of California

Colorado is in the interest of justice or convenience. 3 First, Defendant’s insistence that Plaintiff’s

2

United States District Court

1

than this forum.

12

In addition, Plaintiff argued at the hearing that transfer should be denied because Defendant’s

13

Case Management Conference statement reveals that he intends to call OCM employees who work

14

in the Pleasanton, California office as witnesses in this case. Those California witnesses would

15

presumably testify to Plaintiff’s alleged embezzlement scheme, which, Defendant may argue,

16

provides Plaintiff a motive to launch false accusations against Defendant. While the Court is

17

mindful that this issue may be pursued and these witnesses called at trial, the Court assigns little

18

weight to the potential witnesses’ presence in this forum considering that the extent of their role, if

19

any, in trial is uncertain.

20

C.

21

Failure to State a Claim 4
A motion to dismiss pursuant to Rule 12(b)(6) for failure to state a claim upon which relief

22

can be granted “tests the legal sufficiency of a claim.” Navarro v. Block, 250 F.3d 729, 732 (9th Cir.

23

2001). Dismissal under Rule 12(b)(6) may be based on either (1) the “lack of a cognizable legal

24

theory,” or (2) “the absence of sufficient facts alleged under a cognizable legal theory.” Balistreri v.

25
The parties do not dispute that the action could have been brought in the District of Colorado.
Although the caption to Plaintiff’s Opposition to the motions provides that Plaintiff opposes
Defendant’s Rule 12(b)(6) motion, the body of Plaintiff’s Opposition fails to include a discussion of
that motion. However, at the hearing, Plaintiff clarified that he does oppose the motion and asked that
his arguments contained in his previous opposition to Defendant’s first motion to dismiss be
incorporated into his present Opposition. The Court grants Plaintiff’s request.
3

26
27
28

4

18

1

Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1988). While “detailed factual allegations” are

2

not required, a complaint must include sufficient facts to “state a claim to relief that is plausible on

3

its face.” Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). “A claim has facial plausibility when the

4

plaintiff pleads factual content that allows the court to draw the reasonable inference that the

5

defendant is liable for the misconduct alleged.” Id.

6

For purposes of ruling on a Rule 12(b)(6) motion to dismiss, the Court accepts all allegations

7

of material fact as true and construes the pleadings in the light most favorable to the plaintiffs.

8

Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). The Court need

9

not, however, accept as true pleadings that are no more than legal conclusions or the “formulaic

Northern District of California

recitation of the elements’ of a cause of action.” Iqbal, 556 U.S at 663. Mere “conclusory

11
United States District Court

10

allegations of law and unwarranted inferences are insufficient to defeat a motion to dismiss for

12

failure to state a claim.” Epstein v. Wash. Energy Co., 83 F.3d 1136, 1140 (9th Cir. 1996).

13

1.

14

“The tort of false imprisonment is the nonconsensual, intentional confinement of a person,

15

without lawful privilege, for an appreciable length of time, however short.” Snyder v. Evangelical

16

Orthodox Church, 216 Cal. App. 3d 297, 303 (1989) (internal quotation marks omitted). “A person

17

is falsely imprisoned if he or she is wrongfully deprived of his or her freedom to leave a particular

18

place by the conduct of another.” Id.

19

False Imprisonment

Plaintiff alleges that the term of false imprisonment lasted from the time Plaintiff was

20

ordered to wait in a cabin with a sheriff’s deputy close by and in full view, until he disembarked

21

from the airplane in Oakland and was released. Defendant argues that Plaintiff’s false imprisonment

22

claim is insufficient because the FAC does not adequately allege “confinement.” Defendant asserts

23

that “[Plaintiff] does not allege that at any time during the purported he asked to leave, tried to leave,

24

expressed fear of harm or was threatened with force.” (Dkt. No. 39 at 22.) Defendant, however,

25

does not correctly state the standard for confinement in California. Restraint, or confinement, “may

26

be effectuated by means of physical force, threat of force or of arrest, confinement by physical

27

barriers, or by means of any other form of unreasonable duress.” Fermino v. Fedco, Inc., 7 Cal. 4th

28

701, 715 (1994) (internal citations omitted). Plaintiff claims that when the false imprisonment began

19

1

in a cabin on Defendant’s ranch, Plaintiff observed a police vehicle parked nearby the cabin with a

2

man in uniform behind the wheel, and was told by one of Defendant’s alleged agents that “[a] sheriff

3

is here to make sure you don’t wander off.” (Dkt. No. 1 ¶ 19.) Defendant does not explain how this

4

implicit threat of arrest if Plaintiff were to attempt to “wander off” fails to allege confinement.

5

In addition, after his alleged three-hour confinement in the cabin, Plaintiff was driven to a

6

Denver airport and put on a private plane at 2:00 a.m. even though he asked to be taken to the closer

7

Aspen airport where he had a scheduled flight to San Francisco the next morning. Thus, contrary to

8

Defendant’s assertion, Plaintiff did “ask[] to leave.” Plaintiff also alleges that he believed an escort

9

on the flight from Denver was armed, thus suggesting a threat of force if Plaintiff were to attempt to

Northern District of California

escape. Taking Plaintiff’s allegations as true, and drawing all reasonable inferences in Plaintiff’s

11
United States District Court

10

favor, the Court finds that the claimed sequence of events adequately alleges confinement. One

12

could infer from these facts that Plaintiff was not free to leave during the time he alleges he was

13

falsely imprisoned.

14

Defendant also argues that Plaintiff’s declaration submitted with his opposition to the initial

15

motion to dismiss reveals that Plaintiff cannot state a claim for false imprisonment. In particular,

16

Defendant contends that Plaintiff’s statement that he was provided a telephone while in the cabin

17

and told that he could speak on the telephone “for as long as the minutes lasted,” (Dkt. No. 28 ¶ 11),

18

precludes Plaintiff’s claim. However, “[a]s a general rule, a district court may not consider any

19

material beyond the pleadings in ruling on a Rule 12(b)(6) motion.” Lee v. City of Los Angeles, 250

20

F.3d 668, 688 (9th Cir. 2001).

21

Even if the Court were to consider it, the Court is not persuaded that access to a telephone

22

necessarily precludes a false imprisonment claim. Defendant’s authority is not to the contrary. In

23

Lucterhand v. Granite Microsystems, Inc., 2007 WL 703400, at *16 (E.D. Wis. Mar. 02, 2007) the

24

court found no false imprisonment on a motion for summary judgment where it was undisputed that

25

the defendant “did not use or threaten to use physical force or violence or verbally or physically

26

assault” the plaintiff, who alleged that defendant did not allow him to leave work to go to the

27

hospital. The court found that no reasonable juror could conclude that plaintiff did not have

28

“reasonable means of escape” where, among other things, the plaintiff “never used his cell phone to

20

1

call a friend, ambulance, or taxi to pick him up.” Id. Rather, the only impediment to the plaintiff

2

leaving and seeking medical attention was the plaintiff’s concern that he would displease his boss,

3

the defendant, if he left work. As an initial matter, Defendant seeks to dismiss the claim under Rule

4

12(b)(6); this is not a motion for summary judgment as in Lucterhand. Further, unlike in

5

Lucterhand, Plaintiff was actually threatened with arrest, albeit implicitly. In addition, Defendant’s

6

insistence that Plaintiff could use a phone ignores that, given the circumstances, a phone provided

7

Plaintiff with little assistance. The police were already present, and were there to make sure Plaintiff

8

“[did not] wander off;” a taxi, presumably, would not be allowed to enter Defendant’s private ranch,

9

even if a taxi would service the secluded location. For the same reasons, Defendant’s reliance on

Northern District of California

Hanna v. Marshall Field & Co., is also inapposite. See 279 Ill. App. 3d 784, 794 (1996) (finding no

11
United States District Court

10

false imprisonment on a motion for summary judgment where plaintiff-employee voluntarily entered

12

her employer’s office, was never threatened with the loss of her job, the meeting occurred during

13

work hours, the door to the office was not locked, and plaintiff had access to a telephone).

14

2.

Civil Conspiracy

15

“Conspiracy is not a cause of action, but a legal doctrine that imposes liability on persons

16

who, although not actually committing a tort themselves, share with the immediate tortfeasors a

17

common plan or design in its perpetration.” Applied Equip. Corp. v. Litton Saudi Arabia Ltd., 7 Cal.

18

4th 503, 510–511 (1994). “By participation in a civil conspiracy, a coconspirator effectively adopts

19

as his or her own the torts of other coconspirators within the ambit of the conspiracy.” Id. at 511. A

20

prerequisite to an action based on a conspiracy liability theory to commit a tort is the commission of

21

the underlying tort. Doctors’ Co. v. Super. Ct., 49 Cal. 3d 39, 44 (1989). The elements of a civil

22

conspiracy are (1) the formation of a group of two or more persons who agreed to a common plan or

23

design to commit a tortious act; (2) a wrongful act committed in furtherance of the common design;

24

and (3) resulting damages. Applied Equip. Corp., 7 Cal. 4th at 511. “A claim of unlawful

25

conspiracy must contain ‘enough fact to raise a reasonable expectation that discovery will reveal

26

evidence of illegal agreement.’” PQ Labs, Inc. v. Yang Qi, 2012 WL 2061527, at *8 (N.D. Cal. June

27

7, 2012) (quoting Twombly, 550 U.S. at 556).

28

21

1

Plaintiff alleges that “Koch, DOES 1 through 25 and each of them, agreed, by words or

Plaintiff’s harm was caused by the acts of Koch, DOES 1 through 25 and each of them.” (Dkt. No.

4

38 ¶ 36.) 5 Defendant contends that these allegations are conclusory and therefore Plaintiff’s

5

conspiracy claim fails. However, taken as a whole, Plaintiff’s FAC adequately alleges a claim for

6

civil conspiracy. As already discussed, the parties who allegedly perpetrated the tort did so on

7

Defendant’s private property immediately following an “interrogation” of Plaintiff concerning his

8

alleged embezzlement from Defendant’s companies. These factual allegations plausibly suggest that

9

the actions of the Doe individuals in committing the tort resulted from an agreement between at least

10

one of those individuals and Defendant, and raise a reasonable expectation that discovery will reveal

11
Northern District of California

conduct, to falsely imprison Plaintiff; they did subject Plaintiff to false imprisonment; . . . and

3

United States District Court

2

evidence of the illegal agreement.

12

3.

Conspiracy under 42 U.S.C. § 1983

13

For a claim under 42 U.S.C. § 1983, Plaintiff must allege: (1) the action occurred “under

14

color of law” and (2) the action resulted in a deprivation of a constitutional right or a federal

15

statutory right. See Souders v. Lucero, 196 F.3d 1040, 1043 (9th Cir. 1999). To state a claim for

16

conspiracy to violate an individual’s civil rights, a plaintiff must plead sufficient facts to infer “the

17

existence of an agreement or ‘meeting of the minds’ to violate constitutional rights.” Mendocino

18

Envtl. Ctr. v. Mendocino County, 192 F.3d 1283, 1301 (9th Cir. 1999) (internal quotation marks

19

omitted). The existence of a conspiracy may be inferred when the alleged conspirators have

20

committed acts that “are unlikely to have been undertaken without an agreement.” Id. No

21

heightened pleading standard applies. See Empress LLC v. City and County of San Francisco, 419

22

F.3d 1052, 1056 (9th Cir. 2005) (“The federal system is one of notice pleading, and the court may

23

not apply a heightened pleading standard to plaintiff’s allegations of conspiracy.”).

24

Here, Plaintiff alleges that Defendant “DOES 1 through 25 and each of them, conspired with

25

other persons, including local law enforcement officers acting under color of state law, to

26

accomplish a violation of Plaintiff’s constitutional rights by intentionally restricting Plaintiff’s

27
28

The paragraphs in Plaintiff’s FAC are misnumbered. Although Plaintiff’s FAC states that the cited
paragraph is “27” it is actually “36.”
5

22

1

freedom of movement.” (Dkt. No. 38 ¶ 38.) Plaintiff’s FAC, however, does not adequately allege

2

that there was an agreement or “meeting of the minds” between the sheriff’s deputies and Defendant,

3

or Defendant’s agents, to falsely imprison Plaintiff. Rather, Plaintiff’s FAC simply alleges that

4

Deputy Hart was at the ranch that day for a “security job,” and was told that Defendant “wanted a

5

law enforcement presence ‘in case things got out of control’” while he terminated some of his

6

employees. (Dkt. No. 38 ¶ 28.) These allegations do not support an inference that the deputies and

7

Defendant conspired to violate Plaintiff’s constitutional rights.

make sure you don’t wander off,” (Dkt. No. 38 ¶ 22), this allegation—to the extent it is claimed to

10

support the deputy’s agreement to falsely imprison Plaintiff—conflicts with Plaintiff’s allegation

11
Northern District of California

Although Plaintiff was told by one of Defendant’s alleged agents that “[a] sheriff is here to

9

United States District Court

8

noted above that Deputy Hart was just there “in case things got out of control.” Consequently,

12

Plaintiff does not adequately allege that Deputy Hart agreed to falsely imprison Plaintiff as opposed

13

to simply agreeing to be present in case a police officer was needed while Defendant terminated his

14

employees. In addition, the allegation that one of Defendant’s employees told Deputy Smith that the

15

phone and Internet service at the ranch would be turned off so “these guys couldn’t . . . communicate

16

outside until they were totally done” also does not provide a basis for a reasonable inference that the

17

deputies conspired to falsely imprison Plaintiff. (Id. at ¶ 29.) Although Plaintiff alleges he did not

18

have access to a phone, and Deputy Smith knew this, it does not follow that the deputies also agreed

19

to confine Plaintiff.

20

The Court’s conclusion that Plaintiff does not adequately allege a Section 1983 conspiracy

21

claim does not disrupt its findings above regarding Plaintiff’s state law claims. While the deputies

22

may have been unaware of Defendant’s false imprisonment—and, in fact, may have been mere

23

pawns in Defendant’s misconduct—Plaintiff has adequately alleged that there was a separate

24

conspiracy between Defendant and his agents to falsely imprison Plaintiff, and that they did falsely

25

imprison Plaintiff.

26

Plaintiff’s Section 1983 conspiracy claim is accordingly dismissed with leave to amend.

27
28

23

1

D.

Motion to Strike Punitive Damages Allegations

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Finally, Defendant moves to strike allegations regarding punitive damages from the

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Complaint pursuant to Federal Rule of Civil Procedure 12(f). Rule 12(f) states that a district court

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“may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or

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scandalous matter.” Fed. R. Civ. P 12(f). Rule 12(f), however, does not authorize a district court to

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strike a claim for damages on the ground that such damages are precluded as a matter of law. See

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Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 971 (9th Cir. 2010). This is because Rule 12(f)

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motions are reviewed for abuse of discretion, whereas 12(b)(6) motions are reviewed de novo. Id. at

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973. If a party were to seek dismissal of a pleading (by striking claims for damages) under Rule

Northern District of California

12(f), “the district court’s action would be subject to a different standard of review than if the district

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United States District Court

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court had adjudicated the same substantive action under Rule 12(b)(6).” Id. “Applying different

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standards of review, when the district court’s underlying action is the same, does not make sense.”

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Id.; see also Finuliar v. BAC Home Loans Servicing, L.P., 2011 WL 4405659, at *14 (N.D. Cal.

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Sept. 21, 2011) (denying a Rule 12(f) request to strike a request for punitive damages under

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Whittlestone). Defendant’s Motion to Strike is accordingly denied.

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CONCLUSION
For the reasons stated, Defendant’s Motion to Dismiss for Lack of Personal Jurisdiction is

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DENIED; Defendant’s Motion to Dismiss for Improper Venue or, in the alternative, Motion to

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Transfer is DENIED; Defendant’s Motion to Dismiss for Failure to State a Claim is GRANTED in

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part and DENIED in part; and Defendant’s Motion to Strike is DENIED.

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An amended complaint, if any, shall be filed no later than 20 days from the date of this
Order.
IT IS SO ORDERED.

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Dated: April 30, 2013
_________________________________
JACQUELINE SCOTT CORLEY
UNITED STATES MAGISTRATE JUDGE

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