Uselmann v. Pop
| Decision Date | 29 September 2022 |
| Docket Number | 19-cv-13652 |
| Parties | MIRELA USELMANN, D/B/A SAPPHIRE TRUCKING, INC., ET AL., Plaintiffs, v. RAZVAN POP, ET AL., Defendants. |
| Court | U.S. District Court — Eastern District of Michigan |
On October 23, 2020, Plaintiffs Mirela Uselmann, Gabriel Biclea Ion Gutu, and Dumitru Marius Rendenciuc, (collectively, “Plaintiffs”), filed their First Amended Class Action Complaint against Defendants Razvan Pop, Maria Pop, RSP Express Inc., and NA Truck Repair, LLC, (the “Defendants”). ECF No. 19, PageID.546. Plaintiffs allege Defendants engaged in a RICO, 18 U.S.C. § 1964, et seq. fraud scheme that siphoned millions of dollars from Plaintiffs' share of contract proceeds. They also allege state law claims for breach of contract, unjust enrichment, conversion, and promissory estoppel.
Presently before the Court is Defendants' March 18, 2022, Motion for Summary Judgment [#63]. Plaintiffs filed a Response in Opposition on April 8, 2022. ECF No. 64, PageID.2670. Defendants submitted a Reply brief on April 22, 2022. ECF No. 67, PageID.2773.
Upon review of the parties' submissions, the Court concludes that oral argument will not aid in the disposition of this matter. Accordingly, the Court will resolve Defendants' motion on the briefs. See E.D. Mich. L. R. 7.1(f)(2). For the reasons set forth below, the Court will GRANT IN PART and DENY IN PART Defendants' Motion for Summary Judgment [#63].
Plaintiffs are independent truck owner-operators who contracted with Defendant RSP to transport freight for third-party shippers between 2006 and 2015. See Uselmann v. Pop, 495 F.Supp.3d 528, 532 (E.D. Mich. 2020). RSP is a transportation provider that handles third-party businesses' transportation needs to move goods across the United States and Canada. These third-parties paid RSP directly for each freight delivery. Id. RSP then contracted with truck owneroperators to transport the third-parties' haul.
Pursuant to the contracts between owner-operators and RSP (the “Agreements”), the owner-operators agreed to receive “a sum equal to 80 (%) percent of the gross revenues (after allowable deductions as provided herein),” from RSP. See ECF No. 42-3. Gross revenue was “the amount that the customer agre[ed] to pay RSP for a shipment, load.” ECF No. 48-7, PageID.1538. The Agreements entitled RSP to twenty percent of gross revenues third-party shippers paid for each transport, with the remaining eighty percent going to the owner-operators. Uselmann, 495 F.Supp.3d at 532.
When a freight job became available, RSP dispatchers assigned the work to an owner-operator. ECF No. 48-7, PageID.1539. The dispatcher explained the job's details, including what the route, pickup and drop-off times, and payment amount were. Id. The payment amount was “the gross” revenue that “the owner operator [wa]s being paid 80 percent of.” Id. at PageID.1534. The gross revenue amount RSP dispatchers disclosed to the owner-operators was not based on the actual third-party payments made to RSP, but rather an amount Defendant Razvan Pop advised the dispatchers to disclose. Id. at PageID.1542. Dispatchers never disclosed to the owner-operators the real amounts third-parties paid RSP. Id. at PageID.1529.
RSP mailed Driver/Contractor Settlement statements (the “Settlement Statements”), to Plaintiffs once they completed a freight job. Id. These Settlement Statements purportedly represented the gross revenue from each transaction between third-party customers and RSP. Id. The Settlement Statements are the source of the alleged fraud underlying this action.
Plaintiffs contend that RSP “never disclosed the actual amount” third-parties paid them in the Settlement Statements. ECF No. 19, PageID.547 (emphasis added). According to Plaintiffs, the Settlement Statements RSP provided represented a fraction of the gross revenue RSP received. Plaintiffs charge Defendants with violating the Agreements by understating the gross revenue from transactions between RSP and third-parties, then pocketing the difference for themselves. Id. This practice ceased in 2015, Plaintiffs state, when Defendants changed their contract arrangements with truck owner-operators. Id.
In December 2017, Plaintiff Biclea first realized RSP may have defrauded him by making misrepresentations in its Settlement Statements. ECF No. 42-11, PageID.1309. Around December 4, 2017, another owner-operator, non-party Valentin Ghira, asked Biclea to compare Settlement Statements for loads prior to 2015. Id. The two men realized that their compensation pursuant to their Agreements did not reflect the Settlement Statements' gross revenue amounts. Id. Biclea investigated the discrepancy on January 3, 2018, when he learned about another owner-operator's lawsuit against RSP premised on an Agreement breach. Id. Biclea claims on that day, he learned RSP “had been skimming money off of the 80% that the drivers were entitled to” under the Agreements. Id. at PageID.1310. Biclea shared his findings with Plaintiff Rendenciuc later that spring of 2018, id., who discussed the matter with other named Plaintiffs. ECF No. 42-8, PageID.1291; ECF No. 42-9, PageID.1300.
Plaintiffs commenced this action in December 2019, with a Class Action Complaint, see ECF No. 1. Defendants moved to dismiss the Complaint on January 21, 2020, ECF No. 8, and a hearing was later held on July 13, 2020. This Court issued an opinion and order on October 15, 2020, denying Defendants' Motion to Dismiss all counts. Uselmann, 495 F.Supp.3d at 541. Plaintiffs filed their Amended Complaint eight days later. See ECF No. 19. The Court subsequently denied Defendants' Motion for Reconsideration of that opinion on May 4, 2021. See ECF No. 28. Defendants submitted their Motion for Summary Judgment [#63] on March 18, 2022.
Federal Rule of Civil Procedure 56 permits parties to file a motion for summary judgment when a claim, counterclaim, or crossclaim is asserted against them. Fed.R.Civ.P. 56(b). Summary judgment is appropriate when “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). No genuine dispute of material fact exists where the record “taken as a whole could not lead a rational trier of fact to find for the nonmoving party.” Matsushita Elec. Indus., Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
“Of course, [the moving party] always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact.” Celotex, 477 U.S. at 323. Ultimately, the court evaluates “whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986). In doing so, the Court “draw[s] all reasonable inferences and view[s] the evidence in the light most favorable to the [nonmovant]” to determine whether a genuine dispute of material fact exists. Henschel v. Clare Cty. Rd. Comm'n, 737 F.3d 1017, 1022 (6th Cir. 2013).
Defendants seek summary judgment on each Count in Plaintiffs' Amended Complaint. First, Defendants recycle their argument that Plaintiffs lack standing. Second, Defendants reargue that the statute of limitations have run on Count I and Counts III through VI. Third, Defendants claim entitlement to summary judgment on Counts II and III because no genuine issue of material fact remains supporting Plaintiffs' RICO claims. Fourth, Defendants again argue that Plaintiffs cannot plead Counts IV through VI in the alternative. Defendants conclude that Plaintiff's conversion claim fails as a matter of law. The Court addresses each argument below.
Article III, § 2 of the United States Constitution extends the judicial power of the United States “only to ‘Cases' and ‘Controversies.'” Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016) (quoting U.S. Const. Art. III, § 2). Standing is a jurisdictional requirement, Coal Operators & Assocs., Inc. v. Babbit, 291 F.3d 912, 915 (6th Cir. 2002), which “ensure[s] that federal courts do not exceed their authority” and “limits the category of litigants empowered to maintain a lawsuit in federal court to seek redress for a legal wrong.” Spokeo, 136 S.Ct. at 1547. “[T]here is no case or controversy if the plaintiff lacks standing to sue.” Duncan v. Muzyn, 885 F.3d 422, 427 (6th Cir. 2018). This Court therefore lacks subject matter jurisdiction over matters brought by plaintiffs without standing. See Lyshe v. Levy, 854 F.3d 855, 857 (6th Cir. 2017).
Plaintiffs must establish three factors to satisfy the “irreducible constitutional minimum” for standing: (1) a concrete and particular injury; (2) that Defendants caused, and (3) that the Court can redress. Lujan v. Defs. Of Wildlife, 504 U.S. 555, 560-61 (1992). “A claimant bears the burden of establishing standing and must show it ‘for each claim [they] seek to press.'” Hagy v. Demers & Adams, 882 F.3d 616, 620 (6th Cir. 2018) (quoting DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 352 (2006)).
The court must dismiss a complaint under Rule 12(b)(1) if a claimant fails to establish standing. Turaani v. Sessions, 316 F.Supp.3d 998, 1007 (E.D. Mich. 2018) (citing Lyshe, 854 F.3d at 858).
Defendants argue the...
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