Berlinger et al v. Wells Fargo, N.A. as Successor to Wachovia Bank, N.A.
Filing
220
OPINION AND ORDER granting in part and denying in part 97 Motion to Dismiss. The motion is granted as to Count III, which is dismissed without prejudice, and is otherwise denied. Paragraphs 34 and 47 will be corrected to read: "Plaintiff re-alleges Paragraphs 1-9 as set forth fully herein." Signed by Judge John E. Steele on 9/9/2014. (RKR)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
STACEY SUE BERLINGER, as
Beneficiaries to the Rosa B.
Schwiker Trust and all of
its
related
trusts
aka
Stacey Berlinger O’Connor,
BRIAN BRUCE BERLINGER, and
HEATHER ANNE BERLINGER, as
Beneficiaries to the Rosa B.
Schwiker Trust and all of
its related trusts,
Plaintiffs,
v.
Case No: 2:11-cv-459-FtM-29CM
WELLS
FARGO,
N.A.
as
successor to WACHOVIA BANK,
N.A., as Corporate Trustee
to the Rosa B. Schweiker
Trust,
and
all
of
its
related trusts,
Defendant/Third
Party Plaintiff
BRUCE D. BERLINGER and SUE
CASSELBERRY,
Third Party Defendants.
OPINION AND ORDER
This matter comes before the Court on review of Defendant
Wells Fargo Bank, N.A.'s Motion to Dismiss Plaintiffs' Second
Amended Complaint (Doc. #97) filed on October 11, 2013. Plaintiffs
filed a Response in Opposition (Doc. #106) on November 4, 2013.
For the reasons set forth below, the motion is granted in part and
denied in part.
I.
Under Federal Rule of Civil Procedure 8(a)(2), a complaint
must contain a “short and plain statement of the claim showing
that the pleader is entitled to relief.”
Fed. R. Civ. P. 8(a)(2).
This obligation “requires more than labels and conclusions, and a
formulaic recitation of the elements of a cause of action will not
do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)(citation
omitted).
To survive dismissal, the factual allegations must be
“plausible” and “must be enough to raise a right to relief above
the speculative level.”
Id. at 555.
See also Edwards v. Prime
Inc., 602 F.3d 1276, 1291 (11th Cir. 2010).
than
an
unadorned,
This requires “more
the-defendant-unlawfully-harmed-me
accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)(citations
omitted).
In deciding a Rule 12(b)(6) motion to dismiss, the Court must
accept all factual allegations in a complaint as true and take
them in the light most favorable to plaintiff, Erickson v. Pardus,
551 U.S. 89 (2007), but “[l]egal conclusions without adequate
factual support are entitled to no assumption of truth,”
v.
Berzain,
omitted).
654
F.3d
1148,
1153
(11th
Cir.
Mamani
2011)(citations
“Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not suffice.”
2
Iqbal, 556 U.S. at 678.
consistent
with
a
facially plausible.”
1337
(11th
omitted).
Cir.
“Factual allegations that are merely
defendant’s
liability
fall
short
of
being
Chaparro v. Carnival Corp., 693 F.3d 1333,
2012)(internal
quotation
marks
and
citations
Thus, the Court engages in a two-step approach: “When
there are well-pleaded factual allegations, a court should assume
their veracity and then determine whether they plausibly give rise
to an entitlement to relief.”
Iqbal, 556 U.S. at 679. 1
In ruling on a motion to dismiss, a district court may
consider
materials
attached
to
the
complaint
and
extrinsic
documents which are central to the plaintiff's claim and whose
authenticity is not challenged.
Starship Enters. of Atl., Inc. v.
Coweta County, Ga., 708 F.3d 1243, 1253 n.13 (11th Cir. 2013);
Reese v. Ellis, Painter, Ratteree & Adams LLP, 678 F.3d 1211, 121516 (11th Cir. 2012); SFM Holdings, Ltd. v. Banc of Am. Sec., LLC,
600 F.3d 1334, 1337 (11th Cir. 2010).
When exhibits attached to
a complaint contradict general and conclusory allegations of the
pleading, the exhibits govern.
In re Northlake Foods, Inc., 715
1Plaintiffs’
argument that a complaint will not be dismissed
unless it appears beyond doubt that plaintiff cannot provide a set
of facts in support (Doc. #106, p. 2) refers to a “retired”
standard.
ADA v. Cigna Corp., 605 F.3d 1283, 1288 (11th Cir.
2010).
3
F.3d 1251, 1256-57 (11th Cir. 2013); Griffin Indus., Inc. v. Irvin,
496 F.3d 1189, 1206 (11th Cir. 2007).
II.
This case involves three claims by three beneficiaries of
three family trusts against Wells Fargo, N.A., the former corporate
co-Trustee (Wells Fargo.)
Plaintiffs allege claims for breach of
trust, breach of fiduciary duty, and civil theft.
A previous
Opinion and Order (Doc. #91) dismissed Count III of an amended
complaint based upon a pleading deficiency, without addressing
other issues. 2
As permitted, plaintiffs filed a Second Amended
Complaint (Doc. #93), which Wells Fargo now seeks to dismiss.
Wells
Fargo
asserts
plaintiffs’
civil
theft
claim
should
be
dismissed because for various reasons it fails to state a claim
upon which relief can be granted, and that the entire Second
Amended Complaint should be dismissed as a shotgun pleading (Doc.
#97.))
Plaintiffs argue to the contrary.
2
(Doc. #103.)
Contrary to plaintiffs’ argument (Doc. #106, pp. 4-5), the
Court’s prior Opinion and Order did not deny any of defendant’s
arguments. The Opinion and Order found the civil theft count to
be insufficiently pled as to felonious intent, and stated “the
Court need not address defendant’s additional arguments.” (Doc.
#91, n.1.)
4
III.
A.
Count III: Civil Theft
In Count III, plaintiffs assert that Wells Fargo committed
civil theft of the funds in the three family trust accounts.
Plaintiffs allege that on August 8, 2011, they requested that Wells
Fargo transfer the funds in all three trust accounts to SunTrust
Bank within thirty days.
Wells Fargo failed to do so within thirty
days, and on September 27, 2011, plaintiffs sent Wells Fargo a
pre-suit notice alleging civil theft and demanding treble damages
in excess of $19 million.
By October 27, 2011, Wells Fargo had
transferred the trust funds to SunTrust Bank, although plaintiff
allege that $71,000 has never been transferred.
Plaintiffs claim
actual damages over $6 million due to the delayed transfer of trust
funds to SunTrust Bank.
Wells Fargo seeks dismissal of this count
for several reasons.
(a)
Standing to Assert a Civil Theft Claim
Wells Fargo argues that Count III should be dismissed because
plaintiffs do not have standing to assert a civil theft claim
because they did not have the right to immediate possession of
Trust assets, as required by Florida law.
(Doc. #97, pp. 5-12.)
As the Court previously stated (Doc. #91, p. 5), the elements for
a civil theft claim under Florida law were set forth in United
Techs. Corp. v. Mazer, 556 F.3d 1260, 1270 (11th Cir. 2009).
Additionally, “[u]nder Florida law, a plaintiff in an action for
5
conversion or civil theft must establish possession or an immediate
right to possession of the converted property at the time of the
conversion.”
United States v. Bailey, 419 F.3d 1208, 1212 (11th
Cir. 2005).
Florida law bars a civil theft claim if plaintiff
“had no immediate right to possession” of the allegedly converted
property.
Alex Hofrichter, P.A. v. Zuckerman & Venditti, P.A.,
710 So. 2d 127, 130 (Fla. 3d DCA 1998).
Plaintiffs’ Second Amended Complaint alleges that plaintiffs
had a “legally recognized property interest as the Plantiffs were,
and still are, entitled to immediate possession of monetary assets
totaling $6,464,723.96 . . . by virtue of the trust agreements.”
(Doc. #93, ¶ 49.)
If supported by plausible facts and not
contradicted by the trust documents, this allegation would be
sufficient to withstand a motion to dismiss.
Plaintiffs, however,
do not allege facts to support the conclusory allegation, and the
trust documents attached to the Second Amended Complaint (Doc.
#93, ¶ 12, Exh. A) establish the contrary.
Plaintiffs were not
entitled to a distribution of the Trusts’ assets at any time,
including during the time of the alleged conversion.
It is clear
under the trust documents that no plaintiff had an immediate right
to possess any trust assets, only the right to request and/or
receive such distributions as were authorized by the trustee(s) in
their sole discretion.
Additionally, there is no allegation that
6
a distribution had been authorized during the time of the delayed
transfer of accounts to SunTrust Bank.
Plaintiffs
assert
standing
because
they
have
a
“vested
immediate right to possession” in the assets of the Trusts by
virtue of being permitted to protect trust assets and to mandate
immediate transfer of trust assets to a new trustee.
pp. 7-8.)
(Doc. #106,
This is not sufficient to confer standing for a civil
theft claim.
It is the duty of the trustee, not the beneficiaries,
to protect trust assets and enforce claims of the trust.
Stat. § 736.0809; Fla. Stat. § 736.0811.
have standing to bring such an action.
2d 443 (Fla. 5th DCA 1990).
See Fla.
A beneficiary does not
Traub v. Zlatkiss, 559 So.
Additionally, the right to transfer
the trust assets to a new trustee is not a right to possession by
the beneficiaries of the trust assets.
more
than
the
right
to
request
distributions if and when made.
Plaintiffs still retain no
and
receive
discretionary
If there is a cause of action, it
is for the new trustee, not discretionary beneficiaries.
Because
plaintiffs’
allegation
of
an
immediate
right
to
possess assets from the Trusts during the time of the alleged
conversion is contradicted by the trust documents, the civil theft
claim fails and must be dismissed.
Accordingly, the motion to
dismiss will be granted as to Count III.
7
(b)
Felonious Intent
Defendant argues that the Second Amended Complaint still fails
to adequately allege the felonious intent element of a civil theft
claim.
deprived
The Second Amended Complaint alleges that Wells Fargo
the
beneficiaries
of
their
right
to
property
with
felonious intent in that they refused to reveal the location of
the funds when requested, effectively concealing the location of
the funds (Doc. #93, ¶¶ 53, 58.)
As defendant points out, the
Second Amended Complaint and attached documents establish that
plaintiffs knew the funds were with Wells Fargo.
Indeed, Wells
Fargo’s continued retention of the funds was the impetus for the
demand letter claiming treble damages. Fla. Stat. § 772.11(1).
The Court finds that plaintiffs have not asserted plausible facts
of felonious intent.
(c)
Florida Trust Code
Defendant
asserts
that
the
Florida
Trust
Code
provides
a
corporate trustee with a “reasonable” time to transfer trust funds,
which trump the Florida civil theft statutory requirement of return
of property within thirty days of demand.
Defendant cites no
controlling authority for such a proposition, and the Court finds
no basis to dismiss Count III on this ground.
(d)
Damages
Defendant asserts that Count III fails to properly allege any
damages, and therefore must be dismissed.
8
While plaintiffs claim
over $6 million in damages, there are no facts which plausibly
support the claim.
Plaintiffs were not entitled to possession of
any amount of money, since no distribution had been authorized by
the trustees.
Assuming the delayed transfer is as asserted, there
were no resulting monetary damages to these plaintiffs.
B.
Shotgun Pleading
Wells Fargo contends the Second Amended Complaint constitutes
a shotgun pleading which is prohibited by Federal Rule of Civil
Procedure 10(b) and thus, should be dismissed in its entirety.
(Doc. 97, p. 13).
“Shotgun” pleadings are pleadings in which it
is “virtually impossible to know which allegations of fact are
intended to support which claim(s) for relief.”
Anderson v. Dist.
Bd. of TrS. of Cent. Florida Cmty. Coll., 77 F.3d 364, 366 (11th
Cir. 1996).
Wells Fargo asserts Counts II and III improperly
incorporate all the allegations set forth in Count I in addition
to the general allegations.
(Id.)
Plaintiffs respond that the
Second Amended Complaint is well-pled and properly alleges three
separate counts against defendant with one cause of action in each
count.
(Doc. #106, p. 17.)
The Court takes plaintiffs at their
word, and will strike certain incorporation language to clarify
the one-claim-per-count assertion.
just
the
preceding
general
Count I properly incorporates
allegations.
(Doc.
Paragraphs 34 and 47 will be corrected to read:
alleges Paragraphs 1-9 as set forth fully herein.”
9
#93,
¶
10.)
“Plaintiff re-
Accordingly, it is now
ORDERED:
Defendant
Wells
Fargo
Bank,
N.A.'s
Motion
to
Dismiss
Plaintiffs' Second Amended Complaint (Doc. #97) is GRANTED in part
and DENIED in part.
is
dismissed
The motion is granted as to Count III, which
without
prejudice,
and
is
otherwise
Paragraphs 34 and 47 will be corrected to read:
denied.
“Plaintiff re-
alleges Paragraphs 1-9 as set forth fully herein.”
DONE AND ORDERED at Fort Myers, Florida, this
September, 2014.
Copies:
Counsel of record
10
9th
day of
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