Flores v. Emerich & Fike, 1:05 CV 0291 OWW DLB.
| Decision Date | 21 February 2006 |
| Docket Number | No. 1:05 CV 0291 OWW DLB.,1:05 CV 0291 OWW DLB. |
| Citation | 416 F.Supp.2d 885 |
| Court | U.S. District Court — Eastern District of California |
| Parties | Joe FLORES, an individual; and Connie Flores, an individual Plaintiffs, v. EMERICH & FIKE, a professional corporation, et al. Defendants. |
Joe Flores, Visalia, CA, pro se. Connie Flores, Fresno, CA, pro se.
Marshall C. Whitney, Scott Monroe Harkless, McCormick, Barstow, Sheppard, Wayte & Carruth LLP, Russell Gene Vanrozeboom, Caswell Bell & Hillison LLP, Fresno, CA, Tracy Tosh Lane, Wilson Sonsini Goodrich & Rosati P.C., Mark Elise
Crone, Crone Law Group, LLP, San Francisco, CA, for Defendants.
ORDER GRANTING MOTION TO STRIKE (DOC. 34) AND MOTION TO DISMISS (DOC. 33/35).
This is the third case filed by Joe and Connie Flores ("Plaintiffs") concerning a series of packing and marketing agreements entered into between Plaintiffs and DDJ, Inc., DDJ LLC, and related entities and individuals. DDJ, Inc., and DDJ LLC filed for Chapter 7 Bankruptcy Protection on January 3, 2005. Shortly thereafter, on March 1, 2005, Plaintiffs filed the instant complaint (Flores III), naming as defendants a number of individuals involved with DDJ and affiliated corporate entities (the "DDJ Defendants"). The Flores III complaint also names as defendants the law firm of Emerich & Fike and several individual attorneys at that firm (collectively, the "Fike Defendants") who represent many of the DDJ Defendants.
The Fike Defendants move to dismiss and/or strike all of the claims against them. Specifically, the Fike Defendants move to dismiss the eighth cause of action (civil RICO) and to strike the second (malicious prosecution), third (abuse of process), fourth (violation of the uniform fraudulent transfer act), seventh (conversion), ninth (negligent interference with contract), tenth (conspiracy), and eleventh (invasion of privacy/defamation) causes of action.
Plaintiffs' filed their initial complaint against DDJ, Inc., DDJ LLC, and others in 1999, asserting claims under the Perishable Agricultural Commodities Act ("PACA"), along with state law contract and tort claims. See Flores et al v. DDJ, Inc., et al., 1:99-cv-5878 AWI DLB ("Flores I"). In 2003, a jury found for the Flores' on all claims against DDJ Inc. and DDJ LLC ("the Judgment Debtors").
On October 15, 2004, the Flores' filed a second lawsuit, alleging that individual officers of the Judgment Debtors fraudulently transferred assets from the Judgment Debtors into their own names. See In Re Joe Flores, et al. v. Dennis Hagobian, et al., 1:04-cv-6405 OWW DLB ("Flores II").
On January 3, 2005, DDJ, Inc. and DDJ, LLC filed for Chapter 7 bankruptcy protection. Further proceedings in Flores I were stayed pursuant to the automatic stay provision of the Bankruptcy Code. Flores I, Doc. 408 at 2. Similarly, Flores II has been stayed pending notice of whether the bankruptcy trustees will authorize the case to proceed and whether the stay should be lifted for that case. (Flores II, Doc. 19 at 3.)
Shortly after the bankruptcy filing, the Flores' filed the 141-page complaint in this case ("Flores III"). The third complaint alleges various forms of alter ego liability, fraudulent transfers, and the existence of a racketeering enterprise. (Doc. 1 ("Compl."), filed Mar. 1, 2005.) Flores III names as defendants many of the individual and corporate defendants named in Flores I and Flores II, although the Judgment Debtors (DDJ Inc. and DDJ LLC) are not named. The new complaint names
as defendants: Emerich Fike, a law firm that represented DDJ Inc. and DDJ LLC in Flores I, and a number of individual lawyers who practice at Fike (the "Fike Defendants"). Plaintiffs request damages, injunctive relief, and attorney's fees.
On May 10, 2005, counsel for DDJ Inc. and DDJ LLC filed a "notice of filing bankruptcy" in this case, asserting that these proceedings also are subject to the automatic stay because the pending claims concern property belonging to the debtors' estate. The district court determined that the automatic stay applied to some of the defendants, but requested further briefing on the applicability of the stay to the remaining defendants. (Doc. 72.)
The Chapter 7 Bankruptcy Trustee then submitted a report indicating that the Trustee does not intend to pursue any of the claims against the Fike Defendants and consented to an order vacating the stay. The district court vacated the stay and set the Fike Defendants' previously-filed motions to dismiss and to strike for hearing.
Oral argument on these motions was heard December 12, 2005. On February 3, 2006, the related adversary bankruptcy proceeding in Enoch Packing Inc., Joe Flores and Connie Flores v. DDJ Inc, et al., James Salvan Trustee, Case No. 02-17736-A-7, was dismissed without leave to amend. (Does 105 & 106.) The Flores' moved for reconsideration before the bankruptcy court. (Doc. 107, dated Feb. 9, 2006.)
Joe and Connie Flores are apple growers based in Visalia, California. In September 1995, the Flores' entered into a packing and marketing agreement with Fruit Marketing, Inc. (FMI), now known as DDJ Inc. During this relationship, FMI advanced the Flores' money in exchange for a security interest in the Flores' apple crops. The terms of the loan are set forth in a promissory note signed by Joe Flores.
In or around early 1998, the Flores began to suspect that FMI was using improper accounting practices to calculate the amount due to the Flores' under the packing and marketing contract. In April 1998, the Flores demanded access to all of FMI's documents related to the handling and selling of the Flores' 1997 and 1998 apple crops. Throughout the remainder of 1998, the parties disputed the extent to which the Flores' were entitled to access these documents and whether the Flores would need to pay $0.53 per page for copies of the documents.
At some point in mid-1998, the Flores entered into a packing and marketing agreement with a different fruit packer, Hemphill & Wilson enterprises ("H & W"). On October 16, 1998, the Fike Defendants, on behalf of their client FMI, sent a letter to H & W, informing H & W that FMI had a secured interest in the proceeds from the Flores' 1998 apple crop. On October 26, a representative from H & W informed the Flores that H & W would not perform the contract under such circumstances. On October 27, the Fike Defendants sent a letter to the Flores' formally demanding payment of the amount due under the note. Throughout this entire period, the Flores' were still engaged in a dispute with FMI, represented by the Fike Defendants, over how much the Flores would pay to obtain copies of FMI's documents.
On April 27, 1999, an attorney filed a complaint on behalf of the Flores, naming DDJ and related entities and individuals as defendants. Flores, et al., v. DDJ Inc., et al., 1:99-cv-5878. Disputes over access to documents from FMI's files continued throughout 1999 and 2000. Eventually, the Flores' received a large number of documents from FMI. However, the Flores' now assert that these documents had been "sanitized," by one of the DDJ Defendants, Dennis Hagobian, who was seen "shredding documents from sales jackets for many days." (See J. Flores Decl. at 1158.) The evidence of document destruction was known to the Flores' during the Flores I trial.
On July 31, 1999, DDJ sold most of its property to Norman Trainer and his partner Steven Taft ("Trainer and Taft"). Among the assets transferred to Trainer and Taft was the Flores' promissory note. As part of the transaction, DDJ and Trainer and Taft entered into an agreement whereby DDJ agreed to defend against the Flores' lawsuit and pursue the counterclaim on behalf of Trainer and Taft.
The Fike Defendants filed a cross-complaint against the Flores on behalf of DDJ, alleging breach of contract and seeking payment on the promissory note. The Flores later challenged DDJ's standing to bring the counterclaim on behalf of Trainer and Taft. Judge Ishii allowed the claim to go forward.
A jury trial commenced in July 2003. On July 25, a jury returned a special verdict, finding for plaintiffs on all causes of action alleged against DDJ and finding for the Flores' on the counterclaims. The jury determined that the Flores' were entitled to damages.
On October 15, 2004, the Flores' filed a second lawsuit, alleging that individual officers of the Judgment Debtors fraudulently transferred assets from the Judgment Debtors into their own names. See In Re Joe Flores, et al. v. Dennis Hagobian, et al., 1:04-cv-6405 ("Flores II").
On January 3, 2005, DDJ, Inc. and DDJ, LLC filed for Chapter 7 bankruptcy protection.
Plaintiffs' complaint, which is 142 pages long, presents the following eleven "causes of action."1
1. Alter ego liability. (Compl. at 26.)
2. Malicious prosecution. (Id. at 46.)
3. Malicious use of process, spoilation of evidence, and fraudulent concealment of evidence. (Id. at 51.)
4. Violation of the Uniform Fraudulent Transfer Act [Civil Code § 3439 et seq.]. (Id. at 60.)
5. Violation of 7 U.S.C. §§ 499(b)(1), (2) & (4); PACA §§ 2(2) & (5); 21 U.S.C. §§ 331(a), (b), (c) & (k). (Id. at 84.)
6. Fraud, Deceit, Intentional and Negligent Fraud, and Constructive Fraud and Breach of Fiduciary Duty. (Id. at 86.)
7. Conversion. (Id. at 89.)
8. Civil Racketeering in violation of 18 U.S.C. § 1961.
9. Negligent interference with or procurement of a breach of contract. (Id. at 124.)
10. Conspiracy to defraud and commit various other offenses against Plaintiffs business interests. (Id. at 127.)
11. Invasion of privacy. (Id. at 132.)
Although the complaint in this case is detailed and very lengthy, only a few factual allegations are directed at the Fike Defendan...
To continue reading
Request your trial
-
Lauter v. Anoufrieva
...or dispute, and which is based upon the attorney's representation of the client. See Cal. Civ.Code § 1714.10; Flores v. Emerich & Fike, 416 F.Supp.2d 885, 909 (E.D.Cal.2006). Failure to obtain such an order is a defense to any action for civil conspiracy filed in violation of such statute. ......
-
Contreras v. Dowling
...of conspiracy or aiding and abetting do not deprive Dowling's actions of their protected status. (See Flores v. Emerich & Fike (E.D. Cal. 2006) 416 F.Supp.2d 885, 909 ["conclusory allegations" of conspiracy by attorneys "have no legal significance. It is not alleged that the [attorneys] ind......
-
Mandel v. Hafermann
..."even if it is alleged that the attorney made misrepresentations during the course of such communications." Flores v. Emerich & Fike , 416 F. Supp. 2d 885, 900 (E.D. Cal. 2006) (internal quotations and citations omitted); see also Bergstein , 236 Cal. App. 4th at 815, 187 Cal.Rptr.3d 36 (ho......
-
Macklin v. Deutsche Bank Nat'l Trust Co. (In re Macklin)
...84. Id. (citation omitted). 85. Lance Camper Mfg. Corp. v. Republic Indem. Co., 44 Cal. App. 4th 194, 203 (1996). 86. 416 F. Supp. 2d 885, 911 (E.D. Cal. 2006) 87. Flores, F. Supp. 2d at 911 (quoting Living Designs, Inc. v. E.I. Dupont de Nemours and Co., 431 F.3d 353, 361 (9th Cir. 2005)).......