SWIFT v. PANDEY et al

Filing 197

OPINION. Signed by Judge Jose L. Linares on 3/27/17. (DD, ) N/M

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
ROBERT SWIFT,

Civil Action No.: 13-650 (JLL)

Plaintiff,
OPINION
V.

RAMESH PANDEY, et al.,
Defendants.

LINARES, District Judge.
This matter comes before the Court by way of pro se Plaintiff Robert Swift’s Motion for
Partial Summary Judgment pursuant to Federal Rule of Civil Procedure 56 and Local Federal Rule
of Civil Procedure 56.1 (ECF No. 174). Defendants Ramesh Pandey and Rhuwan Pandey have
submitted Opposition (ECF No. 187), which Plaintiff has replied to. (ECF No. 193). The Court
decides this matter without oral argument pursuant to Rule 78 of the Federal Rules of Civil
Procedure.

For the reasons set forth below, the Court denies Plaintiffs Motion for Partial

Summary Judgment.

I.

BACKGROUND’

Plaintiff is a Colorado resident who, at a public bankruptcy auction, “purchased all right,
title and interest in any and all assets in Xechem International, Inc.” (TAC

¶ 4).

The purchase

included any stock of an affiliated Indian corporation, Xechem India Pvt. Ltd. (“Xechern India”).
(Id.). This transaction took place on August 24, 2011. (Id.). It is undisputed that Defendant
Ramesh, along with Defendant Bhuwan, founded of Xechem International, Inc. (“Xechem
International”) in 1994, and that Defendant Ramesh served as its Chief Executive Officer,
President, and Chairman of the Board of Directors. (See P1. $MF ¶ 1; ECF No. 187 (“Def $MF”)
at 5,

¶

1). Defendant Bhuwan served as the company’s General Manager and Director as well as

Vice President of International Operations. (TAC

¶

12).

From the years of 1994 through 2006, Defendant Xechem India was a subsidiary of
Xechem International. (P1. SMF

¶

2). Xechem India is based out of New Delhi, India and is

owned and operated by Defendants Ramesh and Bhuwan. (TAC

¶ 9).

The essence of Plaintifrs

allegations is that Xechem India was a “shell company” that the Defendants used to funnel money
out of Xechern International for their own financial benefit. (See, e.g., Id. at

¶ 46-74).

In 1998,

Defendant Ramesh transferred nearly all of his shares in Xechem India to Defendant Bhuwan,
who, as of August 2007, owned nearly 100 percent of its stock. (Id. at

¶ 32-33).

Plaintiffjoined

Xechem’s board of directors in May 2007. (Id. at ¶ 39).

These background facts are taken from the Plaintiffs statements of material facts, pursuant to Local Civil Rule 56.1.
(ECF No. 174, Plaintiffs Rule 56.1 Statement of Facts (“P1. SMF”)), as well as Plaintiffs Third Amended Complaint
(ECF No. 85 (“TAC”)). The Court notes that Plaintiffs Motion for Partial Summary Judgment contains only eight
Statements of Undisputed Material Fact, which do not provide sufficient factual background. Accordingly, reliance
on the TAC, and Defendants’ Answer thereto, is necessary to provide a more complete factual recitation of the issue
in dispute. For purposes of this Motion, the Court does not necessarily accept the allegations extracted from the TAC
to be true, and merely uses same to provide a more robust factual background.

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Plaintiff alleges that Xechem International wired Xechern India $977,394, supposedly as a
loan, but that there was no contract between the entities supporting said loan. (Id. at ¶ 20). Plainitff
believes that “[Defendant] Ramesh and [Defendant] Bhuwan used the money [from the purported
laon]

...

for travel, to buy assets held by Xechem India, including cars, land

...

and to pay for the

day-to-day operation of Xechem India, including money to their relatives”, but fails to provide any
evidence in support of this contention. (TAC

¶

17, cf P1. SMf). At a May 2007 meeting of

Xechem International’s board of directors, “[t]he Board inquired as to the need for an accounting
of the source and use of the funds as soon as possible, to determine the advisability and cost of
funding Xechem India.” (TAC

¶ 41).

Defendant Ramesh told the board that $700,000 had been

lent from Xechern International to Xechem India, that $100,000 of that loan had been sent recently,
“and that Xechem India did not have significant assets to date.” (Id.).
Defendant Ramesh was subsequently removed from his position as Chief Executive
Officer, President, and Board Chairman of Xechern International in July 2007. (Id. at

¶ 43).

In

2008, Xechern International filed for Bankruptcy protection. Plaintiff asserts that Xechem India
has not repaid the principal or interest on the loan from Xechern International. (Id. at

¶] 47-54).

The gravarnen of Plaintiffs TAC is that Defendants did not give Xechem International’s board
adequate notice that Xechem India was not a subsidiary of Xechem Internaitonal. (Id. at

¶ 45).

According to Plaintiff, had the board known this fact, Xechem International’s “board of directors
would not have authorized” the loan. (Id. at ¶ 45).
Accordingly, Plaintiff brought this action on January 31, 2013.

(ECF No. 1). Afler

substantial motion practice and numerous amendments, the TAC became the operative complaint.
The TAC contains six counts asserting the following causes of action: Count I

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—

“Quantum Meruit

by [Defendant] Ramesh;” Count II

—

“Qttantttm Merttit by [Defendant] Bhuwan;” Count III

“Quantum Meritit by Xechern India;” Count IV
Count V

—

—

—

“Unjust Enrichment by [Defendant] Rarnesh;

“Unjust Enrichment by [Defendant] Bhuwan;” and Count VI— “Unjust Enrichment by

Xechem India.” (See generally TAC). Plaintiff previously moved for partial summary judgement
on November 9, 2015 (ECF No. 113), but this Court administratively tenTlinated same, without
prejudice, as it was made without the requisite leave to file such a motion in contravention of the
pretrial scheduling order. (ECF No. 116). Plaintiff was finally granted leave to file his Motion for
Partial Summary Judgment and the instant application followed.
Plaintiffs Motion for Partial Summary Judgment requests that this Court enter an Order
granting judgment in his favor, as a matter of law.

(See ECF No. 174 (“P1. Mov. Br.”)).

Specifically, Plaintiff argues that the evidence elicited during discovery clearly shows that
Defendants Ramesh and Bhuwan are liable for Unjust Enrichment, Promissory Estoppel, and
Equitable Estoppel. (P1. Mov. Br. at 6-9).
II.

LEGAL STANDARD

Summary judgment is appropriate when, drawing all reasonable inferences in the non
movant’s favor, there exists no “genuine dispute as to any material fact” and the movant is entitled
to judgment as a matter of law. See Fed. R. Civ. P. 56(a); Anderson

Liberty Lobby, Inc., 477

U.S. 242, 255 (1986). “[T]he moving party must show that the non-moving party has failed to
establish one or more essential elements of its case on which the non-moving party has the burden
of proof at trial.” McCabe v. Ernst & Young, LLP, 494 F.3d 418, 424 (3d Cir. 2007) (citing Celotex
C’orp.

V.

C’atrett, 477 U.S. 317, 322-23 (1986)).

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The Court must consider all facts and their reasonable inferences in the light most favorable
to the non-moving party. See Pa. Coal Ass ‘n v. Babbitt, 63 F.3d 231, 236 (3d Cir. 1995). If a
reasonable juror could return a verdict for the non-moving party regarding material disputed
factual issues, summary judgment is not appropriate. See Anderson, 477 U.S. at 242-43 (“At the
summary judgment stage, the trial judge’s function is not himself to weigh the evidence and
determine the truth of the matter but to determine whether there is a genuine issue for trial.”).
III.

ANALYSIS

Preliminarily, the Court notes that Plaintiff has moved for summary judgment for two
causes of action which were not included in his TAC. See TAC cf P1. Mov. Br. Specifically,
Plaintiff moves for partial summary judgment for claims of promissory estoppel and equitable
estoppel. (P1. Mov. Br. at 7-9). Yet, Plaintiffs TAC makes no mention of these claims. (See
generally TAC).

Rule 8(a) of the Federal Rules of Civil Procedure mandates that a plaintiffs complaint set
forth: (1) a short and plain statement of the grounds upon which the Court’s jurisdiction depends;
(2) a short and plain statement ofthe claim showing that Plaintiffs are entitled to relief and (3) a

demand for the relief sought. F ed. R. Civ. P. 8(a)(emphasis added). “[W]ithout some factual
allegation in the complaint, a claimant cannot satisfy the requirement that he or she provide not
only fair notice, but also the grounds on which the claims rests.” Phillips v. Cnty. ofAllegheny,
515 F.3d 224, 232 (3d Cir. 2008)(citation omitted). The Court recognizes that complaints filed
pro se are “to be liberally construed,” and that the Court is obligated to use “less stringent standards

than formal pleadings drafted by lawyers.” Erickson v. Parthts, 551 U.S. 89, 94 (2007)(per
curiam). However, the relaxed standard does not relieve a pro se litigant of the duty to give fair

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notice. “[A] situation may arise where.

.

.

the factual detail in a complaint is so undeveloped that

it does not provide a defendant the type of notice of claim which is contemplated by Rule 8.”

Phillips, 515 F.3d at 233 (citation omitted) (emphasis added).
In this matter, Plaintiff has, at no point ever, put any Defendant on notice that he was
asserting claims for promissory estoppel and equitable estoppel. Moreover, by failing to plead
these causes of action, Plaintiff has not provided Defendants with any factual allegations
associated therewith. Allowing such a claim to proceed would not comport with the notions of
fairness that underlie Rule 8(a), nor would it be consistent with Phillips, sttpra. Thus, the Court
denies Plaintiffs Motion for Partial Summary Judgment as it pertains to the unplead claims of
promissory estoppel and equitable estoppel.
Furthermore, the Court denies Plaintiffs Motion for Partial Summary Judgment as to the

unjust enrichment claims. To succeed on a claim for unjust enrichment under New Jersey law, “a
plaintiff must show both that defendant received a benefit and that retention of that benefit without
payment would be unjust.” VRG Corp. V. GKAT Realty Coip., 135 N.J. 539, 554 (N.J. Sup. Ct.
1994); see also Callano v. Oalm’ood Park Homes Corp., 91 N.J. Super. 105, 108 (N.J. Super. Ct.
App. Div. 1966). Additionally, for an unjust enrichment claim to succeed, there must be a showing

that “the plaintiff expected remuneration from the defendant, or if the true facts were known to
plaintiff, he would have expected remuneration from defendant, at the time the benefit was
conferred.” Callano, 91 N.J. Super. at 109 (emphasis added); see also VRG Corp., 135 N.J. at
554.

Here, even if the Court were to accept every single one of Plaintiffs Statement of
Undisputed Material facts as true, Plaintiff still would not be entitled to judgnient as a matter of

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law. Rather, the Statement of Undisputed Material Facts establish that Defendant Ramesh founded
Xechern International and made it a public company in 1994. (P1. SMF

¶ 1). Additionally,

Plaintiffs Statement of Undisputed Material F acts also describes Defendant Ramesh’s various
positions with the company. (Id.). Those statements also explain that Xechem India was publicly
held out to be a subsidiary of Xechem International on Xechem International’s annual financial
statements and on an agreement between Xechern India and an Indian University. (P1. SMF

¶J 2-

3).
Plaintiffs Statement of Undisputed Statement of Material Facts also establish that
Defendant Bhuwan “sent a letter to the Embassy of the United States of America in India requested
[sic] a visa

...

to visit Xechern [International] in the U.S. and in that letter [Defendant] Bhuwan

states that Xechern India

...

is a subsidiary of Xechern International.” (P1. SMF

[]

¶ 4). Moreover,

said statements also show that there was a purported transfer of 66 2/3% of Xechem India assets
to Xechem International, but that said transfer never took place. (P1. SMF

¶] 5-6). Finally, it is

undisputed that there is a contract governs the aforementioned transfer of assets. (P1. SMF

¶ 8).

The Court cannot, based on the aforementioned Statement of Undisputed Material Facts
and the record before it, grant Plaintiffs motion. This is because nowhere within the record does
Plaintiff point to facts or evidence that show Defendants received any benefit. Plaintiff Defendants
benefited from the aforementioned transfer of assets and purported loan from Xechem India to
Xechem International.

However, Plaintiff fails to explain how these transactions actually

benefited Defendants and does not provide any evidence to show that Defendants enjoyed any
benefits from same. Thus, this Court concludes that a genuine issue of material fact exists with
regards as to whether Defendants ever received a benefit from the subject transactions.

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More importantly, even if the transfer of assets and the purported loan from Xecehm
International to Xechern India, a loan that Defendants dispute the existence of and that Plaintiff
has failed to provide evidence in support of (Def. SMF

¶

7), could somehow be construed as a

benefit to Defendants, Plaintiffs Motion for Partial Summary Judgment for unjust enrichment still
fails. Indeed, neither the record nor Plaintiffs Statement of Undisputed Material Facts show that
Plaintiff ever expected remuneration in connection with these transactions. As a matter of fact,
Plaintiffs relationship with Defendants and involvement with Xechem International’s Board of
Directors occurred years after the complained of transactions.

Furthermore, Plaintiff has

introduced no evidence that he would have expected remuneration, had he known about said
transactions. Accordingly, the Court finds that Plaintiff has not provided this Court with sufficient
evidence for it to conclude that there is no genuine issue of material fact that he expected
remuneration in connection with the aforementioned transactions, let alone was deprived of same.
Hence, Plaintiff has failed to establish that he is entitled to summary judgment as to his unjust
enrichment claims and his motion for same is denied.
CONCLUSION

For the aforementioned reasons, Plaintiffs Motion for Partial Summary Judgment is
hereby denied. An appropriate Order accompanies this Opinion.

DATED: March, 2017
STATES DISTRICT JUDGE

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