Hendi et al v. State of Nevada on relation of the Private Investigators Licensing Board et al

Filing 17

ORDER that ECF No. 4 Motion to Dismiss is granted. The Court dismisses the complaint without prejudice. Amended Complaint due by 1/6/2018. Signed by Judge Larry R. Hicks on 12/7/2017. (Copies have been distributed pursuant to the NEF - LH)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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MAHMOUD HENDI and ESI SECURITY
SERVICES, INC.,

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Case No. 3:17-cv-00633-LRH-VPC

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ORDER
Plaintiffs,

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v.
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STATE OF NEVADA ON RELATION OF
THE PRIVATE INVESTIGATORS
LICENSING BOARD, KEVIN INGRAM,
LORI IRIZARRY, JASON WOODRUFF,

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Defendants.

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Defendants State of Nevada on relation of the Private Investigators Licensing Board

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(“Board”), Kevin Ingram, Lori Irizarry, and Jason Woodruff move to dismiss plaintiffs

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Mahmoud Hendi and ESI Security, Inc.’s complaint. ECF No. 4. The plaintiffs opposed the

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motion, and the defendants filed a reply. ECF Nos. 8, 12. The court now grants the motion to

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dismiss, finding the complaint fails to meaningfully distinguish between the multiple defendants

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in regards to the five claims for relief and the multiple plaintiffs in regards to the alleged

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damages.

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I.

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BACKGROUND
Hendi owns ESI Security, which provides private security services for businesses,

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individuals, and special events. ECF. No. 1, Ex. 2. Because ESI Security offers services

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including private patrol officers, it is regulated by the Board. Id. Ingram serves as the Board’s

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executive director, and Irizarry serves as the Board’s deputy executive director. Id. Woodruff

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works as an investigator for the Board. Id.

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Hendi and ESI Security sues the Board, Ingram, Irizarry, and Woodruff, alleging five

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causes of actions: (1) intentional interference with contractual relations, (2) interference with

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prospective business advantage, (3) violation of 42 U.S.C. § 1983 based on the Privileges and

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Immunities Clause of the Fourteenth Amendment, (4) injunctive relief, and (5) defamation per

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se. Id.

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The claims stem from occurrences related to an administrative proceeding held by the

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Board. See id. ESI Security accrued several notices of violations from the Board, prompting it to

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enter into a settlement agreement to resolve the notices. Id. Under the settlement agreement, ESI

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Security agreed to pay certain fines and attorney fees according to a schedule outlined in the

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agreement. Id. It also agreed to an eighteen-month probationary period, during which ESI

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Security agreed to surrender its license if it were found guilty upon any new notices of violations

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by way of a hearing in front of the Board. Id.

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A few months later, ESI Security received a new notice of violations because its sister

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company failed to register an employee with the Board. Id. ESI Security sought a hearing before

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the Board. Id. A complaint was then served on ESI Security, alleging that ESI Security failed to

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make timely payments under the settlement agreement and requesting that ESI Security’s license

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be revoked. Id.

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Sometime thereafter, the defendants allegedly contacted ESI Security’s existing and

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prospective customers. Id. The defendants allegedly communicated to the customers that ESI

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Security: (1) was going to lose its license; (2) was using non-registered employees, (3) was

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overcharging for its services, and (4) was understaffing in violation of a contract. Id. The

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defendants then allegedly advised ESI Security’s customers to seek a different company for

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security services. Id.

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The Board then conducted a hearing on both the notice of violations and the allegedly

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late payments. Id. It eventually found ESI Security guilty of the new violations but declined to

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revoke ESI Security’s license. Id. The Board also found that ESI Security did not make untimely
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payments. Id. The Board ultimately ordered ESI Security to pay a fine and reasonable attorney

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fees. Id. ESI Security has appealed the decision. Id.

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II.

LEGAL STANDARD
Despite the matter initially being filed in state court, Federal Rule of Civil Procedure

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12(b)(6) governs this matter. See Faulkner v. ADT Sec. Servs., Inc., 706 F.3d 1017, 1021 (9th

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Cir. 2013) (citing Kearns v. Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir. 2009)).
A party may seek the dismissal of a complaint under Rule 12(b)(6) for failure to state a

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legally cognizable cause of action. See Fed. R. Civ. P. 12(b)(6) (stating that a party may file a

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motion to dismiss for “failure to state a claim upon which relief can be granted[.]”). To survive a

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motion to dismiss for failure to state a claim, a complaint must satisfy the notice pleading

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standard of Federal Rule 8(a)(2). See Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097,

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1103 (9th Cir. 2008). Under Rule 8(a)(2), a complaint must contain “a short and plain statement

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of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). Rule 8(a)(2)

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does not require detailed factual allegations; however, a pleading that offers only “‘labels and

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conclusions’ or ‘a formulaic recitation of the elements of a cause of action’” is insufficient and

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fails to meet this broad pleading standard. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting

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Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)).
To sufficiently allege a claim under Rule 8(a)(2), viewed within the context of a

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Rule 12(b)(6) motion to dismiss, a complaint must “contain sufficient factual matter, accepted as

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true, to ‘state a claim to relief that is plausible on its face.’” Id. (quoting Twombly, 550 U.S. at

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570). A claim has facial plausibility when the pleaded factual content allows the court to draw

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the reasonable inference, based on the court’s judicial experience and common sense, that the

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defendant is liable for the alleged misconduct. See id. at 678-679 (stating that “[t]he plausibility

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standard is not akin to a probability requirement, but it asks for more than a sheer possibility that

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a defendant has acted unlawfully. Where a complaint pleads facts that are merely consistent with

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a defendant’s liability, it stops short of the line between possibility and plausibility of entitlement

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to relief.”) (internal quotation marks and citations omitted).

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Further, in reviewing a motion to dismiss, the court accepts the factual allegations in the

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complaint as true. Id. However, bare assertions in a complaint amounting “to nothing more than

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a formulaic recitation of the elements of a . . . claim . . . are not entitled to an assumption of

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truth.” Moss v. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) (quoting Iqbal, 556 U.S. at

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698) (internal quotation marks omitted). The court discounts these allegations because “they do

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nothing more than state a legal conclusion—even if that conclusion is cast in the form of a

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factual allegation.” Id. “In sum, for a complaint to survive a motion to dismiss, the non-

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conclusory ‘factual content,’ and reasonable inferences from that content, must be plausibly

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suggestive of a claim entitling the plaintiff to relief.” Id.

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III.

DISCUSSION

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The defendants first argue the complaint must be dimissed because it fails to distinguish

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between the individual defendants and the individual plaintiffs in regards to the multiple claims

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and alleged damages. ECF No. 4 at 4. The court agrees and therefore does not address the

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defendants’ remaining arguments for dismissal.

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The complaint inadequately notices the defendants of which legal claims are asserted

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against them by failing to distinguish between the multiple defendants and the multiple plaintiffs

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in the factual allegations. “Courts consistently conclude that undifferentiated pleading against

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multiple defendants is improper.” Dunson v. Cordis Corp., No. 16-cv-03076-SI, 2016 WL

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3913666, at *3 (N.D. Cal. July 20, 2016) (internal citations and quotations omitted); see also

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Volcano Developers LLC v. Bonneville Mortg., No. 2:11-cv-00504-GMN, 2012 WL 28838, at *5

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(D. Nev. Jan. 4, 2012). In the complaint, the plaintiffs consistently attribute the factual

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allegations to “defendants” or “individual defendants.” See ECF No. 1, Ex. 2. The plaintiffs also

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allege damages to the “plaintiffs” in general rather than distinguishing how Hendi, an individual,

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was harmed versus how ESI Security, a business, was harmed. Id. Further, the plaintiffs also fail

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to indicate against whom each cause of action is asserted. Id. The court therefore dismisses the

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complaint for failing to adequately inform each defendant of the claims against them due to the

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undifferentiated nature of the allegations in the complaint. See McHenry v. Renne, 84 F.3d 1172,

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1176 (9th Cir. 1996) (affirming the dismissal of an undifferentiated complaint for its failure to
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“‘provide defendants with a fair opportunity to frame a responsive pleading.’” (quoting the

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district court’s order of dismissal).

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IV.

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CONCLUSION
IT IS THEREFORE ORDERED that the State of Nevada on relation of the Private

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Investigators Licensing Board, Kevin Ingram, Lori Irizarry, and Jason Woodruff’s motion to

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dismiss (ECF No. 4) is GRANTED. The court dismisses the complaint without prejudice.

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IT IS FURTHER ORDERED that Mahmoud Hendi and ESI Security, Inc. may have
thirty days from the entry of this order to file an amended complaint.

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IT IS SO ORDERED.

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DATED this 7th day of December, 2017.

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LARRY R. HICKS
UNITED STATES DISTRICT JUDGE

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