1 2 3 4 5 6 7 DISTRICT COURT OF GUAM 8 RICHARD T. ARNOLD, Civil Case No. 09-00030
9 Plaintiff,
10 OPINION AND ORDER vs. RE: MOTIONS TO DISMISS 11 12 MANU P. MELWANI, ANITA MELWANI, LAWRENCE J. TEKER, THE SUPERIOR 13 COURT OF GUAM, THE SUPREME COURT OF GUAM, and ROBERT P. KUTZ, 14 Defendants. 15 16 This matter comes before the court on motions to dismiss filed by the Defendants Manu 17 P. Melwani, Anita Melwani, Lawrence J. Teker and Robert P. Kutz (“the Melwani Defendants”) 18 and the Superior Court of Guam and Supreme Court of Guam (“the Judiciary”). See Docket 19 Nos. 18 and 37. The Melwani Defendants contend, inter alia, that this court lacks diversity 20 jurisdiction, while the Judiciary argues, inter alia, that it enjoys absolute judicial immunity from 21 this suit. See Docket Nos. 18 and 37. 22 This court finds that dismissal of the case is proper because the Plaintiff’s claims are 23 subject to dismissal under Federal Civil Procedure Rule 12(b)(6). Moreover, specifically as to 24 Count III, it must be dismissed with prejudice, because the court lacks jurisdiction pursuant to 25 the Rooker-Feldman doctrine and the principles of judicial immunity apply. 26 I. FACTUAL AND PROCEDURAL BACKGROUND 27 At its core, this case is a contract dispute concerning the Plaintiff, president of Pacific 28 Superior Enterprises Corp. (“PSEC”), a local construction company, who had won a bid for the 1 repair and renovation of Guam Housing and Urban Renewal Authority (“GHURA”) residential 2 housing units. See Docket No. 19, Exh. A; GHURA v. Pac. Superior Enters. Corp., 2004 Guam 3 22 ¶ 3. PSEC and Defendant Manu Melwani (“Melwani”) entered into a contract, which 4 spawned years of litigation in the Superior Court of Guam and appeals to the Supreme Court of 5 Guam. 6 Displeased with the rulings of the Superior and Supreme Courts, the Plaintiff filed the 7 instant action in this court, alleging “a fifteen year . . . unconstitutional prejudgment attachment 8 and subsequent release of plaintiff’s money to [Melwani].” See Docket No. 16, First Amended 9 Complaint. Presumably, the Plaintiff believed that monies were due to him as a result of his 10 successful bid with GHURA and his contract with Melwani. See id. 11 Early into the litigation here, the Plaintiff requested this court’s recusal, which was 12 denied. See Docket Nos. 25 and 44. The Plaintiff then sought reconsideration of that ruling, 13 which was also denied. See Docket Nos. 46 and 58. He appealed the order denying 14 reconsideration to the Ninth Circuit, but his action was dismissed for lack of appellate jurisdiction. 15 See Docket Nos. 62 and 69. 16 II. DISCUSSION 17 A. Federal Civil Rule 12(b)(6) 18 A pleading that states a claim for relief must contain, among other things, “a short and 19 plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 20 8(a)(2). Rule 12(b)(6) of the Federal Rules of Civil Procedure permits a Defendant to raise by 21 motion the defense that the complaint “fail[s] to state a claim upon which relief can be granted.” 22 Fed. R. Civ. P. 12(b)(6). 23 Although a complaint does not need “detailed factual allegations, . . . a plaintiff’s 24 obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and 25 conclusions, and a formulaic recitation of the elements of a cause of action will not do . . . .” 26 Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). And although the court “must take all 27 of the factual allegations in the complaint as true, [the court is] not bound to accept as true a 28 legal conclusion couched as a factual allegation.” Ashcroft v. Iqbal, 556 U.S. ___, 129 S. Ct. 1 1937, 1950 (2009) (quotation marks omitted). So, to survive a 12(b)(6) motion to dismiss, a 2 complaint “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that 3 is plausible on its face.’” Id. (quoting Twombly, 550 U.S. at 570)). 4 Iqbal suggests a two-step process for determining whether a motion to dismiss should be 5 granted. The first step is to “identif[y] pleadings that, because they are no more than 6 conclusions, are not entitled to the assumption of truth.” Iqbal, 129 S. Ct. at 1950. These are to 7 be discarded. See id. After discarding those unsupported legal conclusions, the second step is to 8 take any remaining well-pleaded factual allegations, “assume their veracity and then determine 9 whether they plausibly give rise to an entitlement to relief.” Id. 10 As for the meaning of the term “plausibly,” “[a] claim has facial plausibility when the 11 plaintiff pleads factual content that allows the court to draw the reasonable inference that the 12 defendant is liable for the misconduct alleged.” Id. at 1949. This standard 13 is not akin to a “probability requirement,” but it asks for more than a sheer possibility that a defendant has acted unlawfully. Where a complaint pleads facts 14 that are “merely consistent with” a defendant’s liability, it “stops short of the line between possibility and plausibility of “entitlement to relief.” 15 Iqbal, 129 S. Ct. at 1949 (quoting Twombly, 550 U.S. at 557). Application of this standard is “a 16 context-specific task that requires the reviewing court to draw on its judicial experience and 17 common sense.” Id. at 1950. And this standard applies to “all civil actions.” Id. at 1953. 18 In short, “a complaint may survive a motion to dismiss only if, taking all well-pleaded 19 factual allegations as true, it contains enough facts to ‘state a claim to relief that is plausible on its 20 face.’” Hebbe v. Pliler, 611 F.3d 1202, 1205 (9th Cir. 2010) (quoting Iqbal, 129 S. Ct. at 1949). 21 In the case at bar, all Plaintiff’s claims suffer the same infirmity. Each claim offers “no 22 more than conclusions” and therefore, “are not entitled to the assumption of truth.” Iqbal, 129 S. 23 Ct. at 1950. For example, the Plaintiff alleges in Count I that Melwani conspired with GHURA 24 officials “to deprive him of money that was contractually owed to Plaintiff.” Docket No. 16. 25 The other counts reflect the same conclusory language. 26 /// 27 /// 28 1 B. Federal Civil Rule 9(b) 2 Furthermore, the Plaintiff alleges in Counts I, II and IV that the Defendants committed 3 fraudulent acts. However, under Rule 9(b) of the Federal Rules of Civil Procedure, a plaintiff 4 must plead each of the elements of a fraud claim with particularity—i.e., a plaintiff “must set 5 forth more than the neutral facts necessary to identify the transaction.” Cooper v. Pickett, 137 6 F.3d 616, 625 (9th Cir. 1997) (italics in original). In other words, fraud claims must be 7 accompanied by the “who, what, when, where, and how” of the fraudulent conduct charged. 8 Vess v. Ciba-Geigy Corp., USA, 317 F.3d 1097, 1106 (9th Cir. 2003). A pleading is sufficient 9 under Rule 9(b) if it identifies the circumstances constituting fraud so that a defendant can 10 prepare an adequate answer from the allegations. Moore v. Kayport Package Express, Inc., 885 11 F.2d 531, 540 (9th Cir. 1989). While statements of the time, place, and nature of the alleged 12 fraudulent activities are sufficient, mere conclusory allegations of fraud are insufficient. Id.
Free access — add to your briefcase to read the full text and ask questions with AI
1 2 3 4 5 6 7 DISTRICT COURT OF GUAM 8 RICHARD T. ARNOLD, Civil Case No. 09-00030
9 Plaintiff,
10 OPINION AND ORDER vs. RE: MOTIONS TO DISMISS 11 12 MANU P. MELWANI, ANITA MELWANI, LAWRENCE J. TEKER, THE SUPERIOR 13 COURT OF GUAM, THE SUPREME COURT OF GUAM, and ROBERT P. KUTZ, 14 Defendants. 15 16 This matter comes before the court on motions to dismiss filed by the Defendants Manu 17 P. Melwani, Anita Melwani, Lawrence J. Teker and Robert P. Kutz (“the Melwani Defendants”) 18 and the Superior Court of Guam and Supreme Court of Guam (“the Judiciary”). See Docket 19 Nos. 18 and 37. The Melwani Defendants contend, inter alia, that this court lacks diversity 20 jurisdiction, while the Judiciary argues, inter alia, that it enjoys absolute judicial immunity from 21 this suit. See Docket Nos. 18 and 37. 22 This court finds that dismissal of the case is proper because the Plaintiff’s claims are 23 subject to dismissal under Federal Civil Procedure Rule 12(b)(6). Moreover, specifically as to 24 Count III, it must be dismissed with prejudice, because the court lacks jurisdiction pursuant to 25 the Rooker-Feldman doctrine and the principles of judicial immunity apply. 26 I. FACTUAL AND PROCEDURAL BACKGROUND 27 At its core, this case is a contract dispute concerning the Plaintiff, president of Pacific 28 Superior Enterprises Corp. (“PSEC”), a local construction company, who had won a bid for the 1 repair and renovation of Guam Housing and Urban Renewal Authority (“GHURA”) residential 2 housing units. See Docket No. 19, Exh. A; GHURA v. Pac. Superior Enters. Corp., 2004 Guam 3 22 ¶ 3. PSEC and Defendant Manu Melwani (“Melwani”) entered into a contract, which 4 spawned years of litigation in the Superior Court of Guam and appeals to the Supreme Court of 5 Guam. 6 Displeased with the rulings of the Superior and Supreme Courts, the Plaintiff filed the 7 instant action in this court, alleging “a fifteen year . . . unconstitutional prejudgment attachment 8 and subsequent release of plaintiff’s money to [Melwani].” See Docket No. 16, First Amended 9 Complaint. Presumably, the Plaintiff believed that monies were due to him as a result of his 10 successful bid with GHURA and his contract with Melwani. See id. 11 Early into the litigation here, the Plaintiff requested this court’s recusal, which was 12 denied. See Docket Nos. 25 and 44. The Plaintiff then sought reconsideration of that ruling, 13 which was also denied. See Docket Nos. 46 and 58. He appealed the order denying 14 reconsideration to the Ninth Circuit, but his action was dismissed for lack of appellate jurisdiction. 15 See Docket Nos. 62 and 69. 16 II. DISCUSSION 17 A. Federal Civil Rule 12(b)(6) 18 A pleading that states a claim for relief must contain, among other things, “a short and 19 plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 20 8(a)(2). Rule 12(b)(6) of the Federal Rules of Civil Procedure permits a Defendant to raise by 21 motion the defense that the complaint “fail[s] to state a claim upon which relief can be granted.” 22 Fed. R. Civ. P. 12(b)(6). 23 Although a complaint does not need “detailed factual allegations, . . . a plaintiff’s 24 obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and 25 conclusions, and a formulaic recitation of the elements of a cause of action will not do . . . .” 26 Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). And although the court “must take all 27 of the factual allegations in the complaint as true, [the court is] not bound to accept as true a 28 legal conclusion couched as a factual allegation.” Ashcroft v. Iqbal, 556 U.S. ___, 129 S. Ct. 1 1937, 1950 (2009) (quotation marks omitted). So, to survive a 12(b)(6) motion to dismiss, a 2 complaint “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that 3 is plausible on its face.’” Id. (quoting Twombly, 550 U.S. at 570)). 4 Iqbal suggests a two-step process for determining whether a motion to dismiss should be 5 granted. The first step is to “identif[y] pleadings that, because they are no more than 6 conclusions, are not entitled to the assumption of truth.” Iqbal, 129 S. Ct. at 1950. These are to 7 be discarded. See id. After discarding those unsupported legal conclusions, the second step is to 8 take any remaining well-pleaded factual allegations, “assume their veracity and then determine 9 whether they plausibly give rise to an entitlement to relief.” Id. 10 As for the meaning of the term “plausibly,” “[a] claim has facial plausibility when the 11 plaintiff pleads factual content that allows the court to draw the reasonable inference that the 12 defendant is liable for the misconduct alleged.” Id. at 1949. This standard 13 is not akin to a “probability requirement,” but it asks for more than a sheer possibility that a defendant has acted unlawfully. Where a complaint pleads facts 14 that are “merely consistent with” a defendant’s liability, it “stops short of the line between possibility and plausibility of “entitlement to relief.” 15 Iqbal, 129 S. Ct. at 1949 (quoting Twombly, 550 U.S. at 557). Application of this standard is “a 16 context-specific task that requires the reviewing court to draw on its judicial experience and 17 common sense.” Id. at 1950. And this standard applies to “all civil actions.” Id. at 1953. 18 In short, “a complaint may survive a motion to dismiss only if, taking all well-pleaded 19 factual allegations as true, it contains enough facts to ‘state a claim to relief that is plausible on its 20 face.’” Hebbe v. Pliler, 611 F.3d 1202, 1205 (9th Cir. 2010) (quoting Iqbal, 129 S. Ct. at 1949). 21 In the case at bar, all Plaintiff’s claims suffer the same infirmity. Each claim offers “no 22 more than conclusions” and therefore, “are not entitled to the assumption of truth.” Iqbal, 129 S. 23 Ct. at 1950. For example, the Plaintiff alleges in Count I that Melwani conspired with GHURA 24 officials “to deprive him of money that was contractually owed to Plaintiff.” Docket No. 16. 25 The other counts reflect the same conclusory language. 26 /// 27 /// 28 1 B. Federal Civil Rule 9(b) 2 Furthermore, the Plaintiff alleges in Counts I, II and IV that the Defendants committed 3 fraudulent acts. However, under Rule 9(b) of the Federal Rules of Civil Procedure, a plaintiff 4 must plead each of the elements of a fraud claim with particularity—i.e., a plaintiff “must set 5 forth more than the neutral facts necessary to identify the transaction.” Cooper v. Pickett, 137 6 F.3d 616, 625 (9th Cir. 1997) (italics in original). In other words, fraud claims must be 7 accompanied by the “who, what, when, where, and how” of the fraudulent conduct charged. 8 Vess v. Ciba-Geigy Corp., USA, 317 F.3d 1097, 1106 (9th Cir. 2003). A pleading is sufficient 9 under Rule 9(b) if it identifies the circumstances constituting fraud so that a defendant can 10 prepare an adequate answer from the allegations. Moore v. Kayport Package Express, Inc., 885 11 F.2d 531, 540 (9th Cir. 1989). While statements of the time, place, and nature of the alleged 12 fraudulent activities are sufficient, mere conclusory allegations of fraud are insufficient. Id. 13 Finally, “Rule 9(b) applies when (1) a complaint specifically alleges fraud as an essential 14 element of a claim, (2) when the claim ‘sounds in fraud’ by alleging that the defendant engaged 15 in fraudulent conduct . . . and (3) to any allegations of fraudulent conduct, even when none of the 16 claims in the complaint ‘sound in fraud.’” Davis v. Chase Bank U.S.A., N.A., 650 F. Supp. 2d 17 1073, 1089-90 (C.D. Cal. 2009) (citing Vess, 317 F.3d at 1102-06). 18 Here, the Plaintiff fails to allege facts explaining the “what, when, where, and how” of 19 the fraudulent conduct. See Vess, 317 F.3d at 1106. Moreover, he fails to identify the 20 circumstances constituting fraud, such that a defendant would be unable to prepare an adequate 21 answer from the allegations. See Moore, 885 F.2d at 540. Accordingly, Counts I, II, and IV 22 must be dismissed. 23 C. Rooker-Feldman doctrine 24 In addition to the challenges to jurisdiction raised by the Defendants’ motions, this court 25 also has “an independent duty to examine the propriety of subject matter jurisdiction.” Latman 26 v. Burdette, 366 F.3d 774, 781 n.2 (9th Cir. 2004); see also FW/PBS, Inc. v. City of Dallas, 493 27 U.S. 215, 231 (1990) (stating that “federal courts are under an independent obligation to examine 28 their own jurisdiction.”). Although not argued by the parties, the court recognizes that under the 1 Rooker-Feldman doctrine, this court lacks jurisdiction to rule on Count III. 2 The Rooker-Feldman doctrine takes its name from two United States Supreme Court 3 decisions, Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923), and District of Columbia Court of 4 Appeals v. Feldman, 460 U.S. 462 (1983). “Rooker-Feldman prohibits a federal district court 5 from exercising subject matter jurisdiction over a suit that is a de facto appeal from a state court 6 judgment.” Kougasian v. TMSL, Inc., 359 F.3d 1136, 1139 (9th Cir. 2004). The Supreme Court 7 has stated: 8 The Rooker- Feldman doctrine, we hold today, is confined to cases of the kind from which the doctrine acquired its name: cases brought by state-court 9 losers complaining of injuries caused by state-court judgments rendered before the district court proceedings commenced and inviting district court review and 10 rejection of those judgments. 11 Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005). 12 In Noel v. Hall, 341 F.3d 1148 (9th Cir. 2003), the Ninth Circuit set forth the facts and 13 law in both Rooker and Feldman, then extensively examined the development of the Rooker- 14 Feldman doctrine in the circuit. The court concluded that the decisions in Rooker and Feldman, 15 and the seven circuit cases interpreting the Rooker-Feldman doctrine “fall into a relatively clear 16 pattern: It is a forbidden de facto appeal under Rooker-Feldman when the plaintiff in federal 17 district court complains of a legal wrong allegedly committed by the state court, and seeks relief 18 from the judgment of that court.” Id. at 1163. 19 Count III is indisputably a forbidden de facto appeal from the decisions of Guam’s 20 Superior and Supreme Courts. Specifically, the Plaintiff alleges that “[b]oth courts have failed to 21 properly rule concerning the contract signed by the plaintiff and [Melwani] and have abused 22 their discretionary powers to delay and deprive plaintiff of his money.” Docket No. 16. Clearly, 23 the Plaintiff is asking this court to review the rulings of the courts of Guam. Rooker-Feldman 24 bars this court from such review. The Ninth Circuit held: 25 We believe that the following general formulation describes the distinctive role of the Rooker-Feldman doctrine in our federal system: If a federal plaintiff 26 asserts as a legal wrong an allegedly erroneous decision by a state court, and seeks relief from a state court judgment based on that decision, Rooker-Feldman 27 bars subject matter jurisdiction in federal district court. If, on the other hand, a federal plaintiff asserts as a legal wrong an allegedly illegal act or omission by an 28 adverse party, Rooker-Feldman does not bar jurisdiction. 1 Id. at 1164. As noted, the Plaintiff challenges the “allegedly erroneous decision[s]” of Guam’s 2 Superior and Supreme Courts, in direct contravention of Rooker-Feldman doctrine. 3 Accordingly, Count III requires dismissal with prejudice on these grounds as well. 4 D. Judicial Immunity 5 Additionally, Count III must be dismissed on the basis of judicial immunity. 6 “Anglo-American common law has long recognized judicial immunity, a ‘sweeping form of 7 immunity’ for acts performed by judges that relate to the ‘judicial process.’” In re Castillo, 297 8 F.3d 940, 947 (9th Cir. 2002) (quoting Forrester v. White, 484 U.S. 219, 225 (1988)). Thus, 9 judges who are “functioning in their official capacities” are accorded “[a]bsolute immunity.” 10 Olsen v. Idaho State Bd. of Medicine, 363 F.3d 916, 922 (9th Cir. 2004) (citing Stump v. 11 Sparkman, 435 U.S. 349, 364 (1978) (holding that state circuit judge is immune from suit for all 12 actions within his jurisdiction)). 13 In substance, the Plaintiff is unhappy with the decisions of Guam’s Superior and 14 Supreme Courts. However, there is nothing in his complaint suggesting that the judges were 15 functioning outside their “official capacities,” Olsen, 363 F.3d at 922, or were acting outside 16 their jurisdiction. Ashelman v. Pope,793 F.2d 1072, 1075 (9th Cir. 1986) (“Judges are immune 17 from damage actions for judicial acts taken within the jurisdiction of their courts.”). In fact, 18 “[j]udicial immunity applies ‘however erroneous the act may have been, and however injurious 19 in its consequences it may have proved to the plaintiff.’” Id. at 1075 (quoting Cleavinger v. 20 Saxner, 474 U.S. 193 (1985) (citation omitted)). Accordingly, Count III must be dismissed 21 under principles of judicial immunity. 22 III. CONCLUSION 23 Based on the foregoing, the court hereby GRANTS the motions to dismiss (Docket Nos. 24 18 and 37). As to Count I, II and IV, the Plaintiff, as a pro se litigant, shall be given leave to 25 amend. See McGuckin v. Smith, 974 F.2d 1050, 1055 (9th Cir.1992) (stating that“before a 26 district court may dismiss a pro se complaint for failure to state a claim, the court must provide 27 the pro se litigant with notice of the deficiencies of his or her complaint and an opportunity to 28 amend the complaint prior to dismissal.”) (overruled on other grounds, WMX Techs., Inc. v. Arnold v. Melwani, CV09-00030 Opinion and Order re: Motions to Dismiss 1 || Miller, 104 F.3d 1133, 1136 (9th Cir.1997) (en banc)). As to Count III, the court hereby 2 || dismisses it with prejudice, and the Plaintiff shall not be given leave to amend, for the reasons 3 || stated herein.' The Clerk’s Office is directed to issue a judgment in accordance with this Order. 4 SO ORDERED. & 6 /s/ Frances M. Tydingco-Gatewood a Chief Judge 4 : es & Dated: Mar 31, 2011 ' 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 a7o0CO*i‘ai‘(C ‘<‘a;S ' Tn light of this court’s ruling herein, all pending motions, including the one filed today 28 || (Docket No. 91) are hereby considered moot. -7-