1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 Rehan S. Alvi, No. 2:22-cv-00500-KJM-DB 12 Plaintiff, ORDER 13 v. James Eads, 1S Defendant. 16 17 In this action, Richard Alvi alleges James Eads has refused to return the bitcoin Alvi gave 18 | him as security for a loan despite Alvi’s attempts to repay that loan. Eads claims Alvi has no 19 | right to the bitcoin because Alvi has not repaid him. He moves to dismiss for lack of personal 20 | jurisdiction and for failure to state a claim. As explained further below, this court has specific 21 | jurisdiction, and Alvi has stated viable claims based on his allegation that Eads has wrongly 22 | refused repayment, so the motion is denied. 23 | I. ALLEGATIONS 24 Alvi is a real estate investor. Compl. □□ 8-9, ECF No. 1. In September 2019, he offered 25 | to borrow money from Eads at a higher interest rate than Eads could obtain elsewhere. See id. 26 | § 11. The next month, they reached an agreement for Alvi to borrow $225,000 from Eads in 27 | exchange for an “origination fee” and interest. /d. 4 13. The loan was secured by 30.00 bitcoin.
1 Id. ¶ 14. If Alvi did not repay the full balance when it came due a few months later, interest 2 would accrue indefinitely at 8 percent until Eads sought repayment. See id. 3 Eads and Alvi did not speak for the next year. Id. ¶ 15. During that time, the value of the 4 bitcoin rose sharply. Id. ¶ 16. At one time, it was worth more than $2 million. Id. In November 5 2021, Alvi asked Eads to accept repayment of the loan. Id. ¶ 17. At first, Eads claimed not to 6 remember the loan at all. Id. ¶ 18. When Alvi pressed him, however, he said he wanted to keep 7 the bitcoin and would consider the loan “forgiven.” Id. Alvi demanded that Eads return the 8 bitcoin in exchange for full repayment. Id. ¶ 19. Eads never responded. Id. For the next six 9 weeks, Alvi tried unsuccessfully to contact Eads and to arrange repayment, but Eads avoided him 10 and evaded his attempts to contact him. See id. ¶¶ 19, 21–26. 11 Alvi filed this lawsuit after his efforts to close out the loan failed. See id. ¶ 28. He asserts 12 four claims, all under California law: breach of contract, breach of the implied covenant of good 13 faith and fair dealing, conversion, and an equitable claim for unjust enrichment. See id. ¶¶ 29–50. 14 Eads, who lives in Montana, now moves to dismiss for lack of personal jurisdiction; in the 15 alternative, he moves to dismiss for failure to state a claim. See generally Mot., ECF No. 7. The 16 matter is fully briefed and the court submitted it after a combined hearing and scheduling 17 conference on June 17, 2022. See generally Opp’n, ECF No. 8; Reply, ECF No. 10; Mins., ECF 18 No. 15. Benjamin Tolman appeared for Alvi, who also was present, and Stuart Gross appeared 19 for Eads. 20 II. PERSONAL JURISDICTION 21 No federal statute governs the personal jurisdiction questions in this case, so this court 22 must determine whether California courts could exercise jurisdiction over the claims against 23 Eads. See Glob. Commodities Trading Grp., Inc. v. Beneficio de Arroz Choloma, S.A., 972 F.3d 24 1101, 1106 (9th Cir. 2020). California authorizes its courts to exercise jurisdiction “to the full 25 extent permissible under the U.S. Constitution.” Picot v. Weston, 780 F.3d 1206, 1211 (9th Cir. 26 2015) (quoting Daimler AG v. Bauman, 571 U.S. 117, 125 (2014)); see also Cal. Civ. Proc. Code 27 § 410.10. As a result, this court’s personal jurisdiction turns on the limits of the Fourteenth 28 Amendment’s Due Process Clause. See Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 1 U.S. 915, 923 (2011). It is Alvi’s burden to show the court can exercise jurisdiction without 2 depriving Eads of due process. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 3 (9th Cir. 2004). The court assumes the complaint’s uncontroverted allegations are true and 4 resolves any factual disputes in Alvi’s favor. Glob. Commodities, 972 F.3d at 1106. 5 The “canonical opinion” on due process and personal jurisdiction is the Supreme Court’s 6 decision in International Shoe Co. v. Washington. Goodyear, 564 U.S. at 923 (citing 326 U.S. 7 310 (1945)). In that case, the Court held “that a State may authorize its courts to exercise 8 personal jurisdiction over an out-of-state defendant if the defendant has ‘certain minimum 9 contacts with the State such that the maintenance of the suit does not offend traditional notions of 10 fair play and substantial justice.’” Id. (quoting Int’l Shoe, 326 U.S. at 316) (alterations omitted). 11 “In giving content to that formulation, the Court has long focused on the nature and extent of ‘the 12 defendant’s relationship to the forum State.’” Ford Motor Co. v. Mont. Eighth Jud. Dist. Ct., 141 13 S. Ct. 1017, 1024 (2021) (quoting Bristol-Myers Squibb Co. v. Superior Court of Cal., San 14 Francisco Cty., 137 S. Ct. 1773, 1779 (2017)). 15 Over the years, the Supreme Court has recognized “two kinds of personal jurisdiction: 16 general (sometimes called all-purpose) jurisdiction and specific (sometimes called case-linked) 17 jurisdiction.” Id. Alvi relies primarily on specific jurisdiction. See, e.g., Compl. ¶ 5. Courts in 18 the Ninth Circuit use a three-part test to decide “whether a party’s minimum contacts meet the 19 due process standard for exercise of specific personal jurisdiction.” LNS Enters. LLC v. Cont’l 20 Motors, Inc., 22 F.4th 852, 859 (9th Cir. 2022) (quoting In re W. States Wholesale Nat. Gas 21 Antitrust Litig., 715 F.3d 716, 741 (9th Cir. 2013)). First, the plaintiff must show the out-of-state 22 defendant purposefully directed activities to the forum state, “consummate[d] some transaction 23 with the forum” or its residents, or otherwise “purposefully avail[ed]” itself “of the privilege of 24 conducting activities within the forum,” thus “invoking the benefits and protections of its laws.” 25 Glob. Commodities, 972 F.3d at 1107 (quoting Schwarzenegger, 374 F.3d at 802). Second, the 26 plaintiff must show its claims “arise out of or relate to the defendant’s forum-related activities.” 27 Id. Third, if the plaintiff satisfies these first two parts of the test, the defendant may show that 28 exercising personal jurisdiction would be unreasonable. Id. 1 A plaintiff can satisfy the first part of the three-part test by showing the defendant 2 purposefully directed some harmful action toward the forum state. Glob. Commodities, 972 F.3d 3 at 1107. The foundation of this theory of personal jurisdiction is Calder v. Jones, a case in which 4 the Supreme Court held that “a foreign act that is both aimed at and has effect in the forum 5 satisfies the first prong of the specific jurisdiction analysis.” Pebble Beach Co. v. Caddy, 453 6 F.3d 1151, 1156 (9th Cir. 2006) (citing 465 U.S. 783 (1984)). When a plaintiff relies on Calder, 7 the court considers whether the defendant “committed an intentional act” that was “expressly 8 aimed at the forum state,” and as a result, the plaintiff suffered a harm “the brunt of which is 9 suffered and which the defendant knows is likely to be suffered in the forum state.” 10 Schwarzenegger, 374 F.3d at 803 (quoting Dole Food Co., Inc. v. Watts, 303 F.3d 1104, 1111 11 (9th Cir. 2002)). 12 Alvi’s allegations against Eads meet this standard.
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 Rehan S. Alvi, No. 2:22-cv-00500-KJM-DB 12 Plaintiff, ORDER 13 v. James Eads, 1S Defendant. 16 17 In this action, Richard Alvi alleges James Eads has refused to return the bitcoin Alvi gave 18 | him as security for a loan despite Alvi’s attempts to repay that loan. Eads claims Alvi has no 19 | right to the bitcoin because Alvi has not repaid him. He moves to dismiss for lack of personal 20 | jurisdiction and for failure to state a claim. As explained further below, this court has specific 21 | jurisdiction, and Alvi has stated viable claims based on his allegation that Eads has wrongly 22 | refused repayment, so the motion is denied. 23 | I. ALLEGATIONS 24 Alvi is a real estate investor. Compl. □□ 8-9, ECF No. 1. In September 2019, he offered 25 | to borrow money from Eads at a higher interest rate than Eads could obtain elsewhere. See id. 26 | § 11. The next month, they reached an agreement for Alvi to borrow $225,000 from Eads in 27 | exchange for an “origination fee” and interest. /d. 4 13. The loan was secured by 30.00 bitcoin.
1 Id. ¶ 14. If Alvi did not repay the full balance when it came due a few months later, interest 2 would accrue indefinitely at 8 percent until Eads sought repayment. See id. 3 Eads and Alvi did not speak for the next year. Id. ¶ 15. During that time, the value of the 4 bitcoin rose sharply. Id. ¶ 16. At one time, it was worth more than $2 million. Id. In November 5 2021, Alvi asked Eads to accept repayment of the loan. Id. ¶ 17. At first, Eads claimed not to 6 remember the loan at all. Id. ¶ 18. When Alvi pressed him, however, he said he wanted to keep 7 the bitcoin and would consider the loan “forgiven.” Id. Alvi demanded that Eads return the 8 bitcoin in exchange for full repayment. Id. ¶ 19. Eads never responded. Id. For the next six 9 weeks, Alvi tried unsuccessfully to contact Eads and to arrange repayment, but Eads avoided him 10 and evaded his attempts to contact him. See id. ¶¶ 19, 21–26. 11 Alvi filed this lawsuit after his efforts to close out the loan failed. See id. ¶ 28. He asserts 12 four claims, all under California law: breach of contract, breach of the implied covenant of good 13 faith and fair dealing, conversion, and an equitable claim for unjust enrichment. See id. ¶¶ 29–50. 14 Eads, who lives in Montana, now moves to dismiss for lack of personal jurisdiction; in the 15 alternative, he moves to dismiss for failure to state a claim. See generally Mot., ECF No. 7. The 16 matter is fully briefed and the court submitted it after a combined hearing and scheduling 17 conference on June 17, 2022. See generally Opp’n, ECF No. 8; Reply, ECF No. 10; Mins., ECF 18 No. 15. Benjamin Tolman appeared for Alvi, who also was present, and Stuart Gross appeared 19 for Eads. 20 II. PERSONAL JURISDICTION 21 No federal statute governs the personal jurisdiction questions in this case, so this court 22 must determine whether California courts could exercise jurisdiction over the claims against 23 Eads. See Glob. Commodities Trading Grp., Inc. v. Beneficio de Arroz Choloma, S.A., 972 F.3d 24 1101, 1106 (9th Cir. 2020). California authorizes its courts to exercise jurisdiction “to the full 25 extent permissible under the U.S. Constitution.” Picot v. Weston, 780 F.3d 1206, 1211 (9th Cir. 26 2015) (quoting Daimler AG v. Bauman, 571 U.S. 117, 125 (2014)); see also Cal. Civ. Proc. Code 27 § 410.10. As a result, this court’s personal jurisdiction turns on the limits of the Fourteenth 28 Amendment’s Due Process Clause. See Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 1 U.S. 915, 923 (2011). It is Alvi’s burden to show the court can exercise jurisdiction without 2 depriving Eads of due process. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 3 (9th Cir. 2004). The court assumes the complaint’s uncontroverted allegations are true and 4 resolves any factual disputes in Alvi’s favor. Glob. Commodities, 972 F.3d at 1106. 5 The “canonical opinion” on due process and personal jurisdiction is the Supreme Court’s 6 decision in International Shoe Co. v. Washington. Goodyear, 564 U.S. at 923 (citing 326 U.S. 7 310 (1945)). In that case, the Court held “that a State may authorize its courts to exercise 8 personal jurisdiction over an out-of-state defendant if the defendant has ‘certain minimum 9 contacts with the State such that the maintenance of the suit does not offend traditional notions of 10 fair play and substantial justice.’” Id. (quoting Int’l Shoe, 326 U.S. at 316) (alterations omitted). 11 “In giving content to that formulation, the Court has long focused on the nature and extent of ‘the 12 defendant’s relationship to the forum State.’” Ford Motor Co. v. Mont. Eighth Jud. Dist. Ct., 141 13 S. Ct. 1017, 1024 (2021) (quoting Bristol-Myers Squibb Co. v. Superior Court of Cal., San 14 Francisco Cty., 137 S. Ct. 1773, 1779 (2017)). 15 Over the years, the Supreme Court has recognized “two kinds of personal jurisdiction: 16 general (sometimes called all-purpose) jurisdiction and specific (sometimes called case-linked) 17 jurisdiction.” Id. Alvi relies primarily on specific jurisdiction. See, e.g., Compl. ¶ 5. Courts in 18 the Ninth Circuit use a three-part test to decide “whether a party’s minimum contacts meet the 19 due process standard for exercise of specific personal jurisdiction.” LNS Enters. LLC v. Cont’l 20 Motors, Inc., 22 F.4th 852, 859 (9th Cir. 2022) (quoting In re W. States Wholesale Nat. Gas 21 Antitrust Litig., 715 F.3d 716, 741 (9th Cir. 2013)). First, the plaintiff must show the out-of-state 22 defendant purposefully directed activities to the forum state, “consummate[d] some transaction 23 with the forum” or its residents, or otherwise “purposefully avail[ed]” itself “of the privilege of 24 conducting activities within the forum,” thus “invoking the benefits and protections of its laws.” 25 Glob. Commodities, 972 F.3d at 1107 (quoting Schwarzenegger, 374 F.3d at 802). Second, the 26 plaintiff must show its claims “arise out of or relate to the defendant’s forum-related activities.” 27 Id. Third, if the plaintiff satisfies these first two parts of the test, the defendant may show that 28 exercising personal jurisdiction would be unreasonable. Id. 1 A plaintiff can satisfy the first part of the three-part test by showing the defendant 2 purposefully directed some harmful action toward the forum state. Glob. Commodities, 972 F.3d 3 at 1107. The foundation of this theory of personal jurisdiction is Calder v. Jones, a case in which 4 the Supreme Court held that “a foreign act that is both aimed at and has effect in the forum 5 satisfies the first prong of the specific jurisdiction analysis.” Pebble Beach Co. v. Caddy, 453 6 F.3d 1151, 1156 (9th Cir. 2006) (citing 465 U.S. 783 (1984)). When a plaintiff relies on Calder, 7 the court considers whether the defendant “committed an intentional act” that was “expressly 8 aimed at the forum state,” and as a result, the plaintiff suffered a harm “the brunt of which is 9 suffered and which the defendant knows is likely to be suffered in the forum state.” 10 Schwarzenegger, 374 F.3d at 803 (quoting Dole Food Co., Inc. v. Watts, 303 F.3d 1104, 1111 11 (9th Cir. 2002)). 12 Alvi’s allegations against Eads meet this standard. According to the complaint, Eads 13 evaded Alvi because he preferred to keep the 30.00 bitcoin rather than accepting full repayment 14 of the loan; Eads knew Alvi lived in California; and Eads knew that if he did not return the 15 bitcoin, Alvi would suffer a loss in California—that is where Alvi lives and operates his 16 investment business. Their agreement also refers to itself as a “California Promissory Note” and 17 cites California law. See Eads Decl. Ex. A at 1, ECF No. 7-1. The Ninth Circuit has found 18 jurisdiction adheres in similar circumstances. See, e.g., Menken v. Emm, 503 F.3d 1050, 1059 19 (9th Cir. 2007) (finding personal jurisdiction over claims of tortious interference with contractual 20 rights of person who lived in forum state). 21 Contrary to Eads’s arguments in reply, see Reply at 3, “purposeful direction” is an 22 appropriate way to test his contacts with California in this case. The Ninth Circuit does not 23 “impose a rigid dividing line” between the legal tests courts use in personal jurisdiction disputes 24 in cases like this one, which includes elements of both tort and contract law. Glob. Commodities, 25 972 F.3d at 1107. “At bottom,” the question is the same: “whether defendants have voluntarily 26 derived some benefit from their interstate activities such that they ‘will not be haled into a 27 jurisdiction solely as a result of random, fortuitous, or attenuated contacts.” Id. (quoting Burger 28 King, 471 U.S. at 474–75). Alvi alleges Eads has purposefully and wrongly attempted to keep 1 valuable property from him contrary to an agreement that refers expressly to California and its 2 laws. A lawsuit in California would not be “fortuitous” or “random.” Alvi has thus satisfied the 3 first part of the specific jurisdiction test. 4 Alvi’s claims also readily satisfy the second part of that test, i.e., showing his claims 5 “arise out of or relate to the defendant’s forum-related activities.” Glob. Commodities, 972 F.3d 6 at 1107 (quoting Schwarzenegger, 374 F.3d at 802). Eads’s alleged refusal to accept repayment 7 has deprived Alvi of the bitcoin. 8 For the third part of the test, the court must decide whether exercising personal 9 jurisdiction would be “reasonable.” See Burger King, 471 U.S. at 476–78. Eads must show it 10 would be unreasonable for the court to exercise jurisdiction over the claims against him. Glob. 11 Commodities, 972 F.3d at 1107. He must make a “compelling” case. Burger King, 471 U.S. at 12 477. The Ninth Circuit has listed seven factors that can help to decide whether exercising 13 jurisdiction would be unreasonable: 14 (1) the extent of the defendant’s purposeful interjection into the 15 forum state’s affairs; 16 (2) the burden on the defendant of defending in the forum; 17 (3) the extent of conflict with the sovereignty of the defendant’s state; 18 (4) the forum state’s interest in adjudicating the dispute; 19 (5) the most efficient judicial resolution of the controversy; 20 (6) the importance of the forum to the plaintiff’s interest in 21 convenient and effective relief; and 22 (7) the existence of an alternative forum. 23 Freestream Aircraft (Bermuda) Ltd. v. Aero L. Grp., 905 F.3d 597, 607 (9th Cir. 2018). 24 The first factor is neutral. Although Eads’s actions focused on California for the reasons 25 above, California and its affairs do not play a central role in the dispute. Eads’s actions would 26 probably have been similar if Alvi had lived in a different state. 27 The second and seventh factors slightly favor Eads. It would be less burdensome for him 28 to litigate this case in Montana, where he lives, but that burden is small. As the Ninth Circuit 1 wrote more than ten years ago, “[w]ith the advances in transportation and telecommunications 2 and the increasing interstate practice of law, any burden of litigation in a forum other than one’s 3 residence is substantially less than in days past.” CollegeSource, Inc. v. AcademyOne, Inc., 653 4 F.3d 1066, 1080 (9th Cir. 2011) (citations, quotation marks, and alterations omitted). That 5 burden is even smaller today. Depositions, hearings, and other meetings or hearings can be 6 conducted remotely; discovery can be sought, delivered, and reviewed electronically from 7 anywhere; and this court’s docket is available on the internet. 8 The third and fourth factors offset one another. Montana may have an interest in shielding 9 its citizens from litigation in California, but California has an interest in ensuring its citizens have 10 an in-state forum to resolve their disputes. 11 The fifth and sixth factors weigh slightly in favor of litigation in California. The case was 12 filed in California, and the parties have already engaged counsel and litigated in California. 13 California is also a more convenient forum for Alvi than Montana, but not significantly more 14 convenient. Litigation in another district would not impose a significant burden. See Activision 15 Pub. Inc. v. Activision TV Inc., No. 12-8964, 2013 WL 1003546, at *7 (C.D. Cal. Feb. 25, 2013). 16 In sum, two of the seven factors weigh in Eads’s favor, two factors favor Alvi, and the 17 others are essentially neutral. Eads has not made the necessary “compelling case” against 18 personal jurisdiction. 19 Because the court has specific jurisdiction, the court need not decide whether Eads is also 20 subject to this court’s general jurisdiction. The court denies the motion to dismiss for lack of 21 personal jurisdiction. 22 III. FAILURE TO STATE A CLAIM 23 A party may move to dismiss for “failure to state a claim upon which relief can be 24 granted.” Fed. R. Civ. P. 12(b)(6). The motion may be granted if the complaint lacks a 25 “cognizable legal theory” or if its factual allegations do not support a cognizable legal theory. 26 Godecke v. Kinetic Concepts, Inc., 937 F.3d 1201, 1208 (9th Cir. 2019) (quoting Balistreri v. 27 Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1988)). The court assumes all factual 28 allegations are true and construes “them in the light most favorable to the nonmoving party.” 1 Steinle v. City & Cnty. of San Francisco, 919 F.3d 1154, 1160 (9th Cir. 2019) (quoting Parks Sch. 2 of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995)). If the complaint’s allegations do 3 not “plausibly give rise to an entitlement to relief,” the motion must be granted. Ashcroft v. Iqbal, 4 556 U.S. 662, 679 (2009). 5 A complaint need contain only a “short and plain statement of the claim showing that the 6 pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2), not “detailed factual allegations,” Bell Atl. 7 Corp. v. Twombly, 550 U.S. 544, 555 (2007). But this rule demands more than unadorned 8 accusations; “sufficient factual matter” must make the claim at least plausible. Iqbal, 556 U.S. at 9 678. In the same vein, conclusory or formulaic recitations of elements do not alone suffice. Id. 10 (citing Twombly, 550 U.S. at 555). This evaluation of plausibility is a context-specific task 11 drawing on “judicial experience and common sense.” Id. at 679. 12 Alvi’s first claim is for breach of contract. The parties agree this court should apply 13 California contract law. See Mot. at 11–12; Opp’n at 15. The elements of a claim for a breach of 14 contract in California are “(1) the existence of the contract, (2) plaintiff’s performance or excuse 15 for nonperformance, (3) defendant’s breach, and (4) the resulting damages to the plaintiff.” Oasis 16 W. Realty, LLC v. Goldman, 51 Cal. 4th 811, 821 (2011). Eads focuses on the second element: 17 whether Alvi performed his obligations under the contract. Eads argues Alvi had an obligation to 18 repay the loan in full before he has any right to the bitcoin he had used as security. See Mot. at 19 13–14. 20 The court assumes without deciding that Eads has correctly interpreted the contract as 21 conditioning his obligation to return the bitcoin on full repayment. At this early stage, the court 22 must accept Alvi’s allegation that he attempted to fully repay the loan but that Eads evaded him, 23 ignored him, and prevented him from doing so. See Compl. ¶¶ 19–27. With the benefit of these 24 allegations, it is plausible to infer that Alvi could prove at trial that his performance was excused. 25 Under California law, “[n]o one can take advantage of his own wrong.” Cal. Civ. Code § 3517. 26 “Thus, ‘[a] party who prevents fulfillment of a condition of his own obligation . . . cannot rely on 27 such condition to defeat his liability.” Parsons v. Bristol Dev. Co., 62 Cal. 2d 861, 868–69 28 (1965) (quoting Bewick v. Mecham, 26 Cal. 2d 92, 99 (1945)). 1 Eads argues he is not obligated to “accept” payments, but that argument refutes a claim 2 Alvi does not advance. Alvi does not allege Eads breached his obligation to accept payments; he 3 alleges Eads breached his obligation to return the bitcoin. The authority Eads cites acknowledges 4 this disconnect. See Eisenberg v. Citibank, N.A., No. 13-01814, 2017 WL 2978752, at *6 (C.D. 5 Cal. July 10, 2017) (“[T]he Agreement does not impose a duty upon defendants to accept 6 payments—although their refusal to accept a payment might excuse plaintiff from making the 7 payment.”), aff’d on other grounds, 787 F. App’x 929 (9th Cir. 2019). The California Supreme 8 Court also has rejected an actual-repayment argument very similar to the one Eads now makes. 9 See Turner v. Seterus, Inc., 27 Cal. App. 5th 516, 532 (2018) (“[The defendant] cannot defeat the 10 wrongful foreclosure cause of action by relying on its representative’s wrongful refusal of the 11 offer to pay . . . by arguing that plaintiffs never made an actual payment.”). The court denies the 12 motion to dismiss the contract claim. 13 Eads’s arguments for dismissal of Alvi’s second and third claims are derivative of his 14 arguments against the contract claim. See Mot. at 14 (“Plaintiff’s cause of action for a breach of 15 the covenant of good faith and fair dealing fails for the same reason as the breach of contract 16 claim.”); id. at 15 (“As laid out above, Plaintiff does not allege taking any actions that would 17 entitle him to the return of the collateral.”). The court denies the motion to dismiss the second 18 and third claims as well. 19 Alvi’s final claim is for “unjust enrichment.” Compl. ¶ 50. “[M]ost California courts 20 agree that there is no cause of action in California for unjust enrichment.” Lopez v. Wash. Mut. 21 Bank, F.A., No. 09-1838, 2010 WL 1558938, at *11 (E.D. Cal. Apr. 19, 2010). It is, rather, “a 22 general principle, underlying various legal doctrines and remedies.” Id. (quoting Melchior v. New 23 Line Prods., Inc., 106 Cal. App. 4th 779, 793, (2003)). For example, a plaintiff can request an 24 equitable remedy in “quasi-contract” or “quantum meruit” “when an unjust enrichment has 25 occurred.” McBride v. Boughton, 123 Cal. App. 4th 379, 388 n.6 (2004). 26 Alvi’s allegations invoke this equitable theory. See, e.g., Compl. ¶ 50 (“Common law 27 principles and equity dictate that Defendant restore the 30.00 bitcoin to Plaintiff . . . .”). An 28 equitable claim in quasi-contract would fail if Alvi ultimately proves he and Eads had an 1 enforceable agreement. See Paracor Fin., Inc. v. Gen. Elec. Cap. Corp., 96 F.3d 1151, 1167 (9th 2 Cir. 1996) (“[A]n action in quasi-contract . . . does not lie when an enforceable, binding 3 agreement exists defining the rights of the parties.”). The court thus construes Alvi’s fourth claim 4 as an alternative claim that would come into force if he and Eads have no binding agreement 5 defining their rights. He may assert such a claim even though it is inconsistent with his first two 6 claims. See Fed. R. Civ. P. 8(d)(2)–(3) (“A party may set out 2 or more statements of a claim or 7 defense alternatively or hypothetically, either in a single count or defense or in separate ones. . . . 8 A party may state as many separate claims or defenses as it has, regardless of consistency.”). 9 IV. CONCLUSION 10 The court denies the motion to dismiss (ECF No. 7). The court refers this action to a 11 mandatory settlement conference before the assigned magistrate judge to be completed within 60 12 days. The parties shall file a further joint status report within fourteen days of completing that 13 conference. 14 IT IS SO ORDERED. 15 DATED: June 21, 2022.