MATYEV et al v. KAPUSTIN et al

Filing 46

OPINION. Signed by Judge Noel L. Hillman on 4/7/2017. (TH, )

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
CHINGIZ MATYEV, et al.,
1:16-cv-00530-NLH-AMD
Plaintiffs,
OPINION
v.
SERGEY KAPUSTIN, IRINA
KAPUSTINA, MICHAEL GOLOVERYA,
VLADIMIR SHTEYN, IGOR
ZADOROZHNIY, ISKANDER
IBRAGIMOV, TRT INTERNATIONAL,
LTD., OLEG MITNIK, G AUTO
SALES, INC., GLOBAL AUTO,
INC., EFFECT AUTO SALES,
INC., SK IMPORTS, INC.,
GLOBAL CARGO OY, AUCTION AUTO
USA, INC., ATC LOGISTIC OY,
et al.,
Defendants.

APPEARANCES:
ANNA V. BROWN
MARIA TEMKIN
BROWN LEGAL CONSULTING, LLC
1076 OCEAN AVENUE
SEA BRIGHT, NJ 07760
On behalf of Plaintiffs
EKATERINA SCHOENEFELD
SCHOENEFELD LAW FIRM LLC
32 CHAMBERS STREET, SUITE 2
PRINCETON, NJ 08542
On behalf of Defendant Iskander Ibragimov
SUZANA DAS
DAS LAW LLC
555 ROUTE 1 SOUTH
SUITE 100
ISELIN, NJ 08830
On behalf of Defendants TRT International, LTD and Oleg
Mitnik

IRINA KAPUSTINA
137 GRASSHOPPER DRIVE
WARMINSTER, PA 18974
Pro Se Defendant
MICHAEL GOLOVERYA
137 GRASSHOPPER DRIVE
WARMINSTER, PA 18974
Pro Se Defendant
VLADIMIR SHTEYN
3325 WOODLAND CIRCLE
HUNTINGDON VALLEY, PA 19006
Pro Se Defendant
HILLMAN, District Judge
This case is a companion to Akishev v. Kapustin, Civil
Action No. 13-7152 (NLH/AMD), and both cases concern a “baitand-switch” fraudulent scheme masterminded and operated by
defendant, Sergey Kapustin, and allegedly assisted by other
defendants, through deceptive online advertising aimed at luring
international customers to wire funds for automobile purchases
and then switching to higher prices, misrepresenting mileage,
condition and location and ownership of these vehicles,
extorting more funds, and failing to deliver the paid-for
vehicles.

Presently before the Court is the motion of Defendant

Iskander Ibragimov to dismiss Plaintiffs’ claims against him.
For the reasons expressed below, Ibragimov’s motion will be
denied.
BACKGROUND & DISCUSSION
For a detailed recitation of the fraudulent scheme

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perpetrated by Kapustin and other various defendants, see
Akishev v. Kapustin, Civil Action No. 13-7152 (NLH/AMD), Docket
No. 272, 358, 395.

This case concerns additional Plaintiffs,

Chingiz Matyev, Sergey Smirnov, and Igor Zuev, all citizens of
Eastern Europe who, like the Plaintiffs in Akishev v. Kapustin,
used Kaputin’s websites to purchase a car from the United States
to be shipped overseas, wired money to Kapustin, but never
received any vehicle or a refund of their money. 1
The current motion to dismiss is filed by Defendant
Iskander Ibragimov, who is not a party to the Akishev action.
Plaintiffs claim in this case that Ibragimov was involved in
Kapustin’s fraudulent scheme because he developed and managed
the sham websites for the car dealerships, managed the email
accounts that Defendants used to communicate with Plaintiffs and
other victims, traveled from his residence in Pennsylvania to
the dealerships in New Jersey, transacted business with codefendant TRT International, and was a de facto owner or
director of Kapustin’s corporate entities.
Ibragimov argues that Plaintiffs have failed to state any
viable claims against him under RICO or New Jersey’s Consumer

1

The Court has subject matter jurisdiction over this action
pursuant to 28 U.S.C. § 1331 and 18 U.S.C. § 1964(c). The Court
has supplemental jurisdiction over state law claims under 28
U.S.C. § 1367.
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Fraud Act because Plaintiffs’ complaint does not contain facts
connecting their experience with the Kapustin websites and money
wire transfers directly with Ibragimov.

Ibragimov further

argues that the complaint does not set forth facts to establish
the “common purpose” element of a RICO claim, and the statement
that Ibragimov is a de facto owner of the corporate entities is
an inappropriate conclusion of law.
The federal RICO statute, codified at 18 U.S.C. § 1961-68,
provides, in relevant part, that:
It shall be unlawful for any person employed by or
associated with any enterprise engaged in, or the
activities of which affect, interstate or foreign
commerce, to conduct or participate, directly or
indirectly, in the conduct of such enterprise's affairs
through a pattern of racketeering activity or collection
of unlawful debt.
18 U.S.C. § 1962(c).

In order to adequately plead a violation

of the federal RICO statute, a plaintiff must allege: (1)
conduct (2) of an enterprise (3) through a pattern (4) of
racketeering activity.

Lum v. Bank of Am., 361 F.3d 217, 223

(3d Cir. 2004) (citing Sedima, S.P.R.L. v. Imrex Co., Inc., 473
U.S. 479, 496 (1985)).
A valid RICO claim must be based on one of the predicate
criminal offenses listed in 18 U.S.C. § 1962, or a conspiracy to
commit such an offense.

18 U.S.C. §§ 1962, 1964(c).

A

defendant in a racketeering conspiracy need not itself commit or
agree to commit predicate acts.

Smith v. Berg, 247 F.3d 532,
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537 (3d Cir. 2001).

Rather, “all that is necessary for such a

conspiracy is that the conspirators share a common purpose.”
Id.

Thus, if defendants agree to a plan wherein some

conspirators will commit crimes and others will provide support,
“the supporters are as guilty as the perpetrators.”
United States, 522 U.S. 52, 64 (1997).

Salinas v.

Each defendant must

“agree to commission of two or more racketeering acts,” United
States v. Phillips, 874 F.2d 123, 127 n.4 (3d Cir. 1989), and
each defendant must “adopt the goal of furthering or
facilitating the criminal endeavor,” Smith, 247 F.3d at 537.
To state a claim under the NJCFA, N.J.S.A. 56:8–1, et seq.,
a plaintiff must allege: “‘(1) unlawful conduct by the
defendants; (2) an ascertainable loss on the part of the
plaintiff; and (3) a causal relationship between the defendants'
unlawful conduct and the plaintiff's ascertainable loss.’”
Mason v. Coca-Cola Co., 774 F. Supp. 2d 699, 702–03 (D.N.J.
2011) (quoting Frederico v. Home Depot, 507 F.3d 188, 202 (3d
Cir. 2007)).
The NJCFA defines unlawful conduct broadly as:

“The act,

use or employment by any person of any unconscionable commercial
practice, deception, fraud, false pretense, false promise,
misrepresentation, or the knowing concealment, suppression, or
omission of any material fact with intent that others rely upon
such concealment, suppression or omission, in connection with
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the sale or advertisement of any merchandise.”

N.J.S.A. 56:8–2.

In other words, “unlawful practices fall into one of three
general categories: (1) affirmative acts; (2) knowing omissions;
and (3) regulation violations.”

Mason, 774 F. Supp. 2d at 702–

03 (citation omitted).
A motion to dismiss under Federal Civil Procedure Rule
12(b)(6) may be granted only if, accepting all well-pleaded
allegations in the complaint as true and viewing them in the
light most favorable to the plaintiff, a court concludes that
the plaintiff failed to set forth fair notice of what the claim
is and the grounds upon which it rests.

A complaint will

survive a motion to dismiss if it contains sufficient factual
matter to “state a claim to relief that is plausible on its
face.”

Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009).

Although a

court must accept as true all factual allegations in a
complaint, that tenet is “inapplicable to legal conclusions,”
and “[a] pleading that offers labels and conclusions or a
formulaic recitation of the elements of a cause of action will
not do.”

Id. at 678.

For claims that sound in fraud or misrepresentation the
complaint “must state with particularity the circumstances
constituting fraud.”

Fed. R. Civ. P. 9(b).

The level of

particularity required is sufficient details to put defendants
on notice of the “precise misconduct with which they are
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charged.”

In re Riddell Concussion Reduction Litigation, 77 F.

Supp. 3d 422, 433 (D.N.J. 2015) (citing Seville Indus. Machinery
Corp. v. Southmost Machinery Corp., 742 F.2d 786, 791 (3d Cir.
1984)) (other citation omitted).

“‘This requires a plaintiff to

plead the date, time, and place of the alleged fraud, or
otherwise inject precision into the allegations by some
alternative means.’”

Id. (quoting Grant v. Turner, 505 F. App'x

107, 111 (3d Cir. 2012), cert. denied, ––– U.S. ––––, 133 S. Ct.
2770 (2013)).
Plaintiffs’ complaint satisfies the Rule 9(b) pleading
requirement for their RICO and NJCFA claims against Ibragimov.
Plaintiffs have alleged that Ibragimov engaged in numerous
predicates acts, including developing and maintaining the sham
websites which lured unsuspecting customers into believing that
the cars listed on the websites were truly available for
purchase, and managing the email accounts that facilitated the
communication with Plaintiffs in order to perpetrate the baitand-switch scheme.

Ibragimov denies that he did these things,

but that denial ostensibly shows that the complaint satisfies
the requirement that a pleading for fraud must provide
sufficient notice to the defendant as to the precise misconduct
with which he is charged.

Moreover, even though the complaint

does not specifically allege that Ibragimov personally
interacted with Plaintiffs, the complaint’s allegations
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concerning Ibragimov’s personal involvement with the fraudulent
scheme is the proper focus of a Rule 9(b) analysis.

Finally,

even accepting that Plaintiffs’ claim that Ibragimov is a de
facto owner of the corporate defendants is a conclusion of law
that must not be considered, the complaint sufficiently details
Ibragimov’s alleged involvement with the bait-and-switch scheme
apart from that conclusion.

Specifically, the complaint pleads

with the requisite particularity Ibragimov’s common purpose with
the other defendants to present false information on legitimatelooking websites to lure unsuspecting overseas customers into
sending money for vehicles that either do not exist, or whose
condition is materially misrepresented.
Consequently, Ibragimov’s motion to dismiss Plaintiffs’
complaint against him must be denied.

An appropriate Order will

be entered.

Date: April 7, 2017
At Camden, New Jersey

s/ Noel L. Hillman
NOEL L. HILLMAN, U.S.D.J.

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