Tirgari v. Kazemipour
| Decision Date | 15 December 2022 |
| Docket Number | 22-CV-541-CAB-DDL |
| Parties | REZA TIRGARI, Plaintiff, v. REZA KAZEMIPOUR AND 1792 PARTNERS INC., Defendants. |
| Court | U.S. District Court — Southern District of California |
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS
[DOC. NO. 16]
This matter is before the Court on Defendant Reza Kazemipour's motion to dismiss the second amended complaint (“SAC”). As discussed below, the motion is GRANTED.
On April 19, 2022, Plaintiff Reza Tirgari filed a complaint against Reza Kazemipour (“Kazemipour”), 1792 Partners, Inc. (“1792 Partners”), 1792 Partners General Partnership (“1792GP”) alleging nine causes of action. [Doc. No. 1]. Each cause of action in Plaintiff's original complaint was a state law claim except the ninth cause of action, which was brought under the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1961 et seq. The three defendants filed a joint motion to dismiss the original complaint for failure to state a claim and lack of subject matter jurisdiction. [Doc. No. 5]. Plaintiff then filed his first amended complaint (“FAC”), adding four more state law claims [Doc. No. 6], and Defendants again moved to dismiss the FAC for failure to state a claim. [Doc. No. 9]. Although Plaintiff filed a response in opposition to Defendants' motion to dismiss the FAC, after discovering that 1792 Partners is a suspended corporation and 1792GP is a nonexistent entity, the parties filed a joint motion for Plaintiff to file a second amended complaint (“SAC”), which the Court granted. [Doc. No. 15.]
Plaintiff filed the SAC on September 7, 2022. [Doc. No. 14]. The SAC dropped 1792GP as a defendant and increased the number of causes of action to sixteen, including a new federal claim under the Defend Trade Secrets Act (“DTSA”), 18 U.S.C. § 1836 et seq. Kazemipour now moves to dismiss the SAC.
The SAC is over 100 pages long and filled with redundancies. In summary, Plaintiff alleges Kazemipour convinced Plaintiff to invest thousands of dollars into various business ventures, and Kazemipour allegedly used the funds received from Plaintiff for personal expenses rather than for the agreed upon investments. [MTD at 3; Pl. Resp. at 2].
During the summer of 2018, Plaintiff met Kazemipour. [SAC ¶ 11]. Kazemipour and Plaintiff established an informal friendship and a professional relationship. Kazemipour formed 1792 Partners, an investment advising company, in March 2019. 1792 Partners was suspended in October 2020. [SAC ¶ 3]. The relationship between Plaintiff, Kazemipour, and 1792 Partners is quite convoluted and spans multiple years, but essentially involves Plaintiff and Kazemipour entering into various investment agreements together, with Kazemipour allegedly acting in his capacity as 1792 Partners Chief Executive Officer (“CEO”) for most of the agreements.[1]
In February 2019, Plaintiff and Kazemipour incorporated R2 Ventures, Inc. (“R2 Ventures”) to establish a joint venture where both parties were to invest into “agreed upon” companies and technologies. [SAC ¶ 7]. Through R2 Ventures, Plaintiff and Kazemipour agreed to invest in and develop two software applications (“apps”) for which Plaintiff allegedly created the detailed plans, procedures, and processes. [SAC ¶ 23]. Kazemipour allegedly convinced Plaintiff to provide this information to both Kazemipour and a nonparty app development company. [SAC ¶ 25]. Kazemipour repeatedly reached out to Plaintiff and others via his 1792 Partners email address regarding investment or participation in the app development process. [SAC ¶¶ 169-173, 175-186]. As a result of Kazemipour's communications regarding the apps, Plaintiff was allegedly convinced to invest $240,600 into the development of these apps. [SAC ¶ 46]. The two apps have since been created and posted by 1792 Partners on the Apple App Store. [SAC ¶ 30, SAC Exhibits G & H]. However, Plaintiff has not had access to the information he created, nor has he received any of the money acquired by 1792 Partners for the existence of the apps on the app store. [SAC ¶¶ 399, 402-403].
Plaintiff and Kazemipour used two accounts through which to conduct general R2 Ventures business: (1) the “Joint Investment Account,” a bank account pre-owned by Plaintiff; and (2) the “Joint Amex Account,” a credit card account opened by Plaintiff specifically for R2 Ventures (collectively referred to as “the accounts”). [SAC ¶¶ 7, 35]. Plaintiff added Kazemipour as an authorized user for both accounts. [SAC ¶ 35]. Between the months of March 2019-October 2021, Kazemipour and Plaintiff deposited and withdrew thousands of dollars from the accounts for supposed business-related costs. The accounts were also used as an avenue for Plaintiff to make personal loans to Kazemipour. [SAC ¶¶ 98, 110].
In Plaintiff's fifteenth claim for relief under RICO, Plaintiff alleges that Kazemipour engaged in a pattern of racketeering activity via wire fraud and money laundering from 2019-2021 through 1792 Partners, causing a loss of property of more than $10,000 from the money taken out of the accounts by Kazemipour. [SAC ¶¶ 376-392]. Specifically, he alleges Kazemipour engaged in thirty-seven acts of racketeering activity over the period of March 2019 - December 2021 through 1792 Partners. [SAC ¶¶ 167-240]. Nineteen of these acts were alleged wire fraud under 18 U.S.C. § 1343. [SAC ¶¶ 167-186]. In each alleged act of wire fraud, Kazemipour allegedly either (1) used his 1792 Partners email address to defraud Plaintiff and others into investing in the apps [SAC ¶¶ 169-173, 175-180, 186]; (2) used his 1792 Partners email to send Plaintiff other investment agreements or discuss transfer of funds into the accounts [SAC ¶¶ 178, 181-185]; (3) used his personal email to convince Plaintiff to invest into the apps [SAC ¶¶ 167-168]; or (4) used an email associated with the apps to convince Plaintiff and another to invest in the apps [SAC ¶ 174]. The remaining eighteen acts were alleged money laundering under 18 U.S.C. § 1957. [SAC ¶¶ 189-242]. In each act of alleged money laundering, Kazemipour allegedly withdrew or transferred funds from the R2 Ventures accounts to spend the funds on personal use, including international travel and his daughter's college tuition, resulting in a $750,638 loss to Plaintiff. [SAC ¶ 149].
In his sixteenth claim for relief under DTSA, Plaintiff alleges that Kazemipour and 1792 Partners misappropriated Plaintiff's “trade secrets” when Defendants and the nonparty app development company took his information related to the apps and later published the apps on the app store.
Kazemipour asks the Court to dismiss Plaintiff's Fourth, Sixth, Ninth, Fifteenth, and Sixteenth causes of action. [Notice of MTD at 2]. Kazemipour argues that (1) the SAC does not state facts sufficient to constitute a plausible claim for relief against Kazemipour under any of the causes of action specified; and (2) upon dismissal of Plaintiff's RICO and DTSA claims, original federal jurisdiction will no longer exist under 28 U.S.C. § 1331. [Notice of MTD at 2]. For the reasons below, the MTD is GRANTED.
When considering a motion to dismiss for failure to state a claim under Rule 12(b)(6), the Court evaluates whether a complaint states a recognizable legal theory and sufficient facts in light of Federal Rule of Civil Procedure 8(a)(2), which requires a “short and plain statement of the claim showing that the pleader is entitled to relief.” Although Rule 8 “does not require ‘detailed factual allegations,' . . . it [does] demand . . . more than an unadorned, the defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).
“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim of relief that is plausible on its face.'” Id. (quoting Twombly, 550 U.S. at 570); see also Fed.R.Civ.P. 12(b)(6). A claim is facially plausible when the collective facts pled “allow . . . the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. There must be “more than a sheer possibility that a defendant has acted unlawfully.” Id. Facts “merely consistent with a defendant's liability” fall short of a plausible entitlement to relief. Id. (quoting Twombly, 550 U.S. at 557). The Court need not accept as true “legal conclusions” contained in the complaint, id., or other “allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences,” Daniels-Hall v. Nat'l Educ. Ass'n, 629 F.3d 992, 998 (9th Cir. 2010).
A complaint also must “state with particularity the circumstances constituting fraud.” Fed.R.Civ.P. 9(b). Allegations of fraud must be stated with “specificity including an account of the ‘time, place, and specific content of the false representations as well as the identities of the parties to the misrepresentations.” Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th Cir. 2007) (quoting Edwards v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir. 2004)). To survive a motion to dismiss, “‘allegations of fraud must be specific enough to give defendants notice of the particular misconduct which is alleged to constitute fraud charged so that they can defend against the charge and not just deny that they have done anything wrong.'” Id. (quoting Bly-Magee v. California, 236 F.3d 1014, 1019 (9th Cir. 2001)).
Although Kazemipour moves to dismiss several of the state law claims in addition to the federal claims, the Court addresses the federal claims first, because when federal claims are dismissed at...
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