Lisa Mollicone v. Universal Handicraft, Inc. et al
ORDER denying 97 Motion to Dismiss for Failure to State a Claim; denying 97 Motion to Dismiss for Lack of Jurisdiction; denying 97 Motion to Strike ; denying 97 Motion for More Definite Statement; denying 98 Motion to Dismiss for Failure to State a Claim; denying 98 Motion to Dismiss for Lack of Jurisdiction; denying 98 Motion to Strike ; denying 98 Motion for More Definite Statement. Signed by Judge Robert N. Scola, Jr on 11/28/2017. (vmz)
United States District Court
Southern District of Florida
Lisa Mollicone, individually and on
behalf of all others similarly
Universal Handicraft d/b/a Deep
Sea Cosmetics d/b/a Adore Organic
Innovations, and others,
) Civil Action No. 17-21468-Civ-Scola
Omnibus Order on Motions to Dismiss
This matter is before the Court upon the Defendants Universal
Handicraft and Shay Sabag Segev’s motions to dismiss (ECF Nos. 97, 98). The
Court has carefully considered all supporting and opposing submissions, the
record in this case, and the applicable law. For the reasons set forth below, the
Court denies the motions to dismiss.
This consolidated action began as two cases – one filed by Plaintiff Lisa
Mollicone in the United States District Court for the Central District of
California (No. 16-cv-07322), and the other filed by Plaintiff Millie Land in this
district before Judge Cecilia M. Altonaga (No. 17-cv-21947), in which the
Plaintiffs assert claims against the Defendants based upon allegedly false and
misleading representations with respect to the anti-aging properties of
cosmetics manufactured, marketed and sold by the Defendants. Before
Mollicone’s case was transferred to this Court from California, the District
Judge ruled upon the Defendants’ previous motions to dismiss, in which
Universal challenged the court’s subject matter jurisdiction and the sufficiency
of the allegations in the first amended complaint (ECF No. 25), pursuant to
Rule 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure.
Specifically, Universal argued that Mollicone lacked standing (1) to seek
injunctive relief because she failed to demonstrate that she is threatened with a
concrete and particularized injury; (2) to assert claims regarding products she
did not buy; and (3) to assert claims based on laws of states outside California
and New Jersey. (ECF No. 28.) In addition, and relevant to the Court’s
consideration of the present motion, Universal argued that Mollicone failed to
plead her fraud-based claims with particularity and that her allegations
supported only a claim for lack of substantiation under California law. In her
order, Judge Christina Snyder denied Universal’s motion on these grounds.
Mollicone v. Universal Handicraft, No. 2:16-cv-0732-CAS(MRWx), 2017 WL
440257, at *14 (C.D. Cal. Jan. 30, 2017).1 Thereafter, Mollicone filed a second
amended complaint, which Universal answered. (ECF No. 46.) Subsequently,
pursuant to Universal’s motion, Judge Snyder transferred Mollicone’s case to
this district (ECF No. 57). Upon the parties’ stipulation (ECF No. 91), this Court
consolidated Mollicone’s case with Plaintiff Land’s case, and required the
Plaintiffs to file a third amended complaint (ECF No. 94). In response to the
third amended complaint, the Defendants have filed the instant motions to
2. Legal Standards
a. Standing and dismissal for lack of subject matter jurisdiction
Because the question of Article III standing implicates subject matter
jurisdiction, it must be addressed as a threshold matter prior to the merits of
any underlying claims. Palm Beach Golf Ctr.-Boca, Inc. v. John G. Sarris, D.D.S.,
P.A., 781 F.3d 1245, 1250 (11th Cir. 2015). Article III of the Constitution
grants federal courts judicial power to decide only actual “Cases” and
“Controversies.” U.S. Const. Art. III § 2. The doctrine of standing is a “core
component” of this fundamental limitation that “determin[es] the power of the
court to entertain the suit.” Hollywood Mobile Estates Ltd. v. Seminole Tribe of
Fla., 641 F.3d 1259, 1264-65 (11th Cir. 2011) (quoting Lujan v. Defenders of
Wildlife, 504 U.S. 555, 560 (1992) and Warth v. Seldin, 422 U.S. 490, 498
(1975)). “In the absence of standing, a court is not free to opine in an advisory
capacity about the merits of a plaintiff’s claims, and the court is powerless to
continue.” Id. (citing CAMP Legal Def. Fund, Inc. v. City of Atlanta, 451 F.3d
1257, 1269 (11th Cir. 2006)). The “irreducible constitutional minimum” of
standing under Article III consists of three elements: (1) the plaintiff must have
suffered an actual or imminent injury, or a concrete “invasion of a legally
protected interest”; (2) that injury must have been caused by the defendant’s
complained-of actions; and (3) the plaintiff’s injury or threat of injury must
likely be redressable by a favorable court decision. Lujan, 504 U.S. at 560-61;
see also Hollywood Mobile Estates Ltd., 641 F.3d at 1265 (stating same).
Judge Snyder granted Defendant Segev’s motion pursuant to Rule 12(b)(5) on the
basis that Mollicone failed to serve him properly because she did not obtain a
summons for him. Id. at *6.
b. Dismissal for failure to state a claim
When considering a motion to dismiss for failure to state a claim under
Federal Rule of Civil Procedure 12(b)(6), the Court must accept all of the
complaint’s allegations as true, construing them in the light most favorable to
the plaintiff. Pielage v. McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008). A
pleading need only contain “a short and plain statement of the claim showing
that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). “[T]he pleading
standard Rule 8 announces does not require detailed factual allegations, but it
demands more than an unadorned, the-defendant-has-unlawfully-harmed-me
accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quotation omitted). A
plaintiff must articulate “enough facts to state a claim to relief that is plausible
on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).
“A claim has facial plausibility when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. “The plausibility
standard is not akin to a ‘probability requirement,’ but it asks for more than a
sheer possibility that a defendant has acted unlawfully.” Id. “Threadbare
recitals of the elements of a cause of action, supported by mere conclusory
statements, do not suffice.” Id. Thus, a pleading that offers mere “labels and
conclusions” or “a formulaic recitation of the elements of a cause of action” will
not survive dismissal. See Twombly, 550 U.S. at 555. “Rule 8 marks a notable
and generous departure from the hyper-technical, code-pleading regime of a
prior era, but it does not unlock the doors of discovery for a plaintiff armed
with nothing more than conclusions.” Iqbal, 556 U.S. at 679.
Yet, where the allegations “possess enough heft” to suggest a plausible
entitlement to relief, the case may proceed. See Twombly, 550 U.S. at 557.
“[T]he standard ‘simply calls for enough fact to raise a reasonable expectation
that discovery will reveal evidence’ of the required element.” Rivell v. Private
Health Care Sys., Inc., 520 F.3d 1308, 1309 (11th Cir. 2008) (citation omitted).
“And, of course, a well-pleaded complaint may proceed even if it strikes a savvy
judge that actual proof of those facts is improbable, and ‘that a recovery is very
remote and unlikely.’” Twombly, 550 U.S. at 556 (citation omitted).
3. Universal’s motion (ECF No. 97)
Universal’s motion once again challenges the Court’s subject matter
jurisdiction and the sufficiency of the allegations in the third amended
complaint, which is based upon the same factual allegations as the first and
second amended complaints. In its motion, Universal argues for dismissal on
the basis that (1) in Florida, fraud and deceit claims cannot be maintained as a
class action; (2) the claims for unpurchased products must be dismissed for
lack of standing; (3) all the claims must be dismissed for failure to allege facts
plausibly showing actual falsity; (4) the intentional fraud claim fails to allege
facts plausibly showing the Defendants’ knowledge; (5) Mollicone’s negligent
misrepresentation claim must be dismissed pursuant to the economic loss
rule; (6) Land did not observe and rely upon any advertising prior to her
purchase; and (7) the third amended complaint as a whole is a shotgun
pleading. In the alternative, Universal requests that the Court strike certain
allegations and require a more definite statement with respect to others.
At the outset, the Court notes that pursuant to the parties’ stipulation,
the Defendants agreed not to “renew any arguments already made and rejected
in this action in their challenge to Plaintiff’s proposed amended claims.” (ECF
No. 91.) Thus, to the extent that Universal attempts to re-assert any
arguments, purportedly on behalf of Land, already ruled upon by the California
court with respect to Mollicone, the Court will not consider such arguments.
Moreover, with respect to Mollicone’s claims specifically, and notwithstanding
the parties’ stipulation, Universal’s motion is improper under Rule 12(g). “[A]
party that makes a motion under this rule must not make another motion
under this rule raising a defense or objection that was available to a party but
omitted from its earlier motion.” Fed. R. Civ. P. 12(g)(2). “The purpose of Rule
12(g)(2) is to avoid unnecessary delay at the pleading stage by encouraging the
presentation of an omnibus pre-answer motion in which the defendant
advances every available Rule 12 defense and objection he may have that is
assertable by motion.” Hummel v. Tamko Building Products, Inc., No. 6:15-cv910-Orl-40GJK, 2016 WL 7340301, at *4 (M.D. Fla. Mar. 28, 2016) (internal
quotations and citation omitted). “A defense is unavailable for purposes of Rule
12(g)(2) if its legal basis did not exist at the time of the answer or pre-answer
motion, so that it was for all practical purposes impossible for the defendants
to interpose their defense.” Noveshen v. Bridgewater Assocs., LP, No. 13-CV61535-KAM, 2015 WL 11170928, at *3 (S.D. Fla. July 20, 2015) (Marra, J.)
(internal citation and quotations omitted). As such, the only arguments
remaining for the Court’s consideration are Universal’s first, sixth, and seventh
A. The Court will not dismiss the third amended complaint as a
Universal’s seventh argument fails because the addition of another
named plaintiff’s claims does not render the complaint an impermissible
shotgun pleading. “The most common type [of shotgun pleading]—by a long
shot—is a complaint containing multiple counts where each count adopts the
allegations of all preceding counts, causing each successive count to carry all
that came before and the last count to be a combination of the entire
complaint.” Weiland v. Palm Beach Cty. Sheriff’s Office, 792 F.3d 1313, 1321
(11th Cir. 2015). “The unifying characteristic of all types of shotgun pleadings
is that they fail to one degree or another, and in one way or another, to give the
defendants adequate notice of the claims against them and the grounds upon
which each claim rests.” Id. at 1323 (footnotes omitted). While the Court
recognizes that the substantive counts in the third amended complaint are not
a model of drafting and reincorporate the allegations preceding them, the Court
does not find that such a technical violation alone renders the third amended
complaint so confusing as to justify dismissal in this case.
B. The Court will not dismiss the fraud claims at this stage
Universal argues that claims based on fraud and deceit may not be
maintained as a class action under Florida law because individual issues
predominate. Therefore, Universal argues, such claims are unsuitable for class
treatment, relying primarily on Kondell v. Blue Cross & Blue Shield of Florida,
Inc., 187 F. Supp. 3d 1348, 1361-62 (S.D. Fla. 2016) (Rosenberg, J.), in which
the court stated in the insurance context that common law claims for fraud
“may not be asserted on behalf of a class in Florida.” Kondell, 187 F. Supp. 3d
at 1361. However, “[t]he question of class certification is generally not
addressed on a motion to dismiss.” Chaney v. Crystal Beach Capital, LLC, No.
8:10-cv-1056-T-30TGW, 2011 WL 17639, at *2 (M.D. Fla. Jan. 4, 2011).
Indeed, dismissal based on class action allegations is “an extreme remedy
appropriate only where a defendant demonstrates ‘from the face of the
complaint that it will be impossible to certify the classes alleged by the plaintiff
regardless of the facts the plaintiff may be able to prove.” Oginski v. Paragon
Props. of Costa Rica, LLC, 2011 WL 3489541, at *3 (S.D. Fla. Aug. 9, 2011)
(King, J.) (citing Romano v. Motorola, Inc. 2007 WL 4199781, at *2 (S.D. Fla.
Nov. 26, 2007) (Brown, M.J.) (internal alterations omitted). The Plaintiffs have
not yet sought class certification in this case, thus, whether or not a particular
class should be certified is an inquiry better reserved after full briefing of a
motion for class certification, and a full consideration of the relevant factors
under Rule 23 of the Federal Rules of Civil Procedure.
C. The allegations of reliance are sufficient
Universal argues that the Plaintiffs fail to sufficiently allege that Land
relied on any advertising, label, or statement prior to purchasing the
Defendants’ product. However, upon a review of the third amended complaint,
the Plaintiffs set forth in detail the misrepresentations made by the
Defendants, and allege that they justifiably relied on the Defendants’
misrepresentations and omissions in making the decision to purchase the
Defendants’ products, and altered their position in reliance on the Defendants’
representations and warranties. (Third Am. Compl. ¶¶ 136, 143, 146; ECF No.
95.) These allegations are sufficient.
D. Universal’s motions to strike and for more definite statement in
the alternative are improper
Universal moves, in the alternative, to strike certain allegations in the
third amended complaint, and for a more definite statement. Universal’s
motions are also improper under Rule 12(g). See Chen, 2011 WL 1085646, at
*2 (“Under the plain language of Rule 12(g), the limitation on further motions
applies to ‘a motion under this rule.’ The Rule 12(b)(6), 12(e) and 12(f)
challenges fall under Rule 12 because they are all part of the rule.”) The
allegations and attachments that Universal now seeks to strike, or that
Universal contends require a more definite statement, are identical to
allegations and attachments to the first and second amended complaints, and
which Universal did not challenge. Therefore, Universal’s alternative relief is
4. Segev’s motion (ECF No. 98)
Segev moves to dismiss the third amended complaint under Rule 12(b)(6)
for failure to state a claim, arguing that the Plaintiffs fail to differentiate
between Universal and Segev in their allegations, they fail to allege any specific
conduct by Segev, and that they fail to sufficiently allege an aiding and abetting
theory, corporate officer liability, or to establish an alter ego theory.2 Because
the Court finds the Plaintiffs’ allegations to be sufficient, the Court denies
First, the Defendants already challenged, under Rule 9(b), the sufficiency
of the allegations in the first amended complaint, which is factually identical to
the third amended complaint. The California court already found those
allegations to be sufficient, therefore this Court will not revisit that decision.
Moreover, with respect to Segev’s involvement specifically, the Plaintiffs allege
that Segev is the president of Universal, the incorporator, and one of the
company’s directors. (Third Am. Compl. ¶ 22; ECF No. 95.) The Plaintiffs allege
further that as the president, Segev directs and controls the marketing and
labeling of the Adore products, that Segev dominates the management and
control of Universal, that he exercises total operational control and decisionmaking power including product origination and development, marketing,
sales, and promotion, and that he actually participated in the conduct alleged.
(Id. ¶¶ 103, 107, 111, 113.)
Segev also purportedly incorporates the arguments made by Universal in its motion,
which the Court has already denied for the reasons set forth above.
Rule 9(b) requires that “[i]n alleging fraud or mistake, a party must state
with particularity the circumstances constituting fraud or mistake.” Fed. R.
Civ. P. 9(b). These allegations include the “who, what when where, and how of
the misconduct charged.” Ang v. Bimbo Bakeries USA, Inc., No. 13-cv-01196WHO, 2013 WL 5407039, at *2 (N.D. Cal. Sept. 25, 2013) (quoting Vess v. CibaGeigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003)); see also Mizzaro v.
Home Depot, Inc., 544 F.3d 1230, 1238 (11th Cir. 2008) (“under Rule 9(b), it is
sufficient to plead the who, what, when, where, and how of the allegedly false
statements and then allege generally that those statements were made with the
requisite intent.”). Upon review, the Plaintiffs allege sufficient facts to satisfy
Rule 9(b) with respect to Segev, in that they allege that both Universal and
Segev, as the person directing Universal (the “who”), made misleading
representations in marketing the Adore products (the “what”), since 2012 (the
“when”), on the Defendants’ website, social media, and product packaging (the
“where”), by touting anti-aging effects through their marketing (the “how”). As
such, the allegations are sufficient.
Segev also urges dismissal of the claims against him arguing that the
Plaintiffs fail to sufficiently allege a basis for liability under the theories of
aiding and abetting, corporate officer liability, or alter ego. Segev fails to
support his argument regarding aiding and abetting with any citations to
authority. “On a Rule 12(b)(6) motion to dismiss, ‘[t]he moving party bears the
burden to show that the complaint should be dismissed.’” Sprint Sols., Inc. v.
Fils-Amie, 44 F. Supp. 3d 1224, 1228 (S.D. Fla. 2014) (quoting Mendez-Arriola
v. White Wilson Med. Ctr. PA, No. 09-495, 2010 WL 3385356, at *3 (N.D. Fla.
Aug. 25, 2010)). “The movant must support its arguments for dismissal with
citations to legal authority.” Id. (citing S.D. Fla. L.R. 7.1(a)(1)). “Where a
defendant seeking dismissal of a complaint under Rule 12(b)(6) does not
provide legal authority in support of its arguments, it has failed to satisfy its
burden of establishing its entitlement to dismissal.” Id. (citing Super. Energy
Servs., LLC v. Boconco, Inc., No. 09-0321, 2010 WL 1267173, at *5-6 (S.D. Ala.
Mar. 26, 2010) and United States v. Vernon, 108 F.R.D. 741, 742 (S.D. Fla.
1986)). The Court will not do Segev’s research for him.
With respect to the allegations of corporate officer liability and alter ego,
the Court finds the third amended complaint to be sufficient to withstand
dismissal. Whether the Plaintiffs will ultimately be able to prove that Segev
should be held liable pursuant to these theories is a determination for another
Therefore, for the reasons set forth above, the Defendants’ motions (ECF
Nos. 97 and 98) are denied.
Done and ordered at Miami, Florida, on November 28, 2017.
Robert N. Scola, Jr.
United States District Judge
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