Cevdet Aksüt Oğullari Koll. Sti v. Cavusoglu

245 F. Supp. 3d 650
CourtDistrict Court, D. New Jersey
DecidedMarch 28, 2017
DocketCiv. No. 2:14-3362
StatusPublished
Cited by6 cases

This text of 245 F. Supp. 3d 650 (Cevdet Aksüt Oğullari Koll. Sti v. Cavusoglu) is published on Counsel Stack Legal Research, covering District Court, D. New Jersey primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cevdet Aksüt Oğullari Koll. Sti v. Cavusoglu, 245 F. Supp. 3d 650 (D.N.J. 2017).

Opinion

OPINION

WILLIAM J. MARTINI, U.S.D.J.:

Plaintiff Cevdet Aksüt Ogullari Koll. Sti (“Plaintiff’) brings this action against Hu-seyin Cavusoglu and multiple associates, including American Pistachio Commodities Corporation d/b/a Sunrise Commodities, David Cottam, and Andrew Rosen (collectively “Sunrise Defendants” or “Sunrise”), and Mordy Dicker, alleging thirteen counts of New Jersey, federal and common law violations, in connection with the fraudulent importation of food products from Turkey to the United States. This matter comes before the Court on Sunrise Defendants’ partial motion to dismiss under Federal Rule of Civil Procedure 12(c) for judgment on the pleadings with respect to Counts IV and V of the Complaint. There was no oral argument. Fed. R. Civ. P. 78(b). For the reasons set forth below, Defendants’ motion to dismiss is GRANTED and Counts IV and V are DISMISSED.

I. BACKGROUND

In general, the Complaint alleges that Sunrise Defendants, Dicker and others conspired with Cavusoglu in operating a fraudulent enterprise that induced Turkish food suppliers to ship their goods to Defendants for sale in the United States (the “RICO enterprise”). Plaintiff seeks to collect an unpaid debt of approximately $1.1 million in connection with its business dealings with the RICO enterprise. The Court assumes the parties’ familiarity with the facts of this case, which are summarized in two opinions addressing previous motions to dismiss filed by Sunrise and Dicker. See Op. 3-8, ECF No. 69; Op. 2-3, ECF No. 71.

The Court underscores a few facts that are particularly relevant to the instant motion. Plaintiff is a Turkish corporation with its principal place of business in Nazilli, Turkey. Compl. ¶ 5, ECF No. 1. Sunrise Defendants and Dicker are residents of the United States. Id. at ¶¶ 30, 33, 35, 37. Cavusoglu is also a United States resident and operated several shell corporations in connection with the alleged RICO enterprise out of Linden, New Jersey. See id. at ¶¶ 6, 39-40. Cavusoglu coordinated with Sunrise and Dicker to have Plaintiffs goods stored at the Linden property. See id. at ¶¶ 69-83, 90-95, 147-56.

Plaintiff was first introduced to Cavusoglu through an individual named Aret Museoglu, who was a representative of Plaintiffs previous customer. Museoglu recommended Cavusoglu as a business partner, representing that he was a “big player” in the Turkish-food-import busi[653]*653ness. Id at ¶ 137. After Plaintiff had delivered most of its goods, Museoglu recanted his previous statements and admitted that he knew Cavusoglu to be dishonest and that he took unfair advantage of his suppliers. See id at ¶ 157. In return for kickbacks from the sale of Plaintiffs goods, Museoglu conspired with Cavusoglu to induce Plaintiff to transact -with the RICO enterprise' by making false representations about Ca-vusoglu’s personal integrity, intentions, market share, customer base and past acts. See id at ¶¶ 158, 160. Finally, the record reflects that Plaintiffs, invoices concerning some, but not necessarily all, of the shipped goods indicate “FOB.IZMIR.” See id. Ex. 15.

Sunrise now moves to dismiss only Counts IV and V of the Complaint, which allege violations of the New Jersey Racketeer Influenced Corrupt Organizations (“RICO”) Act, N.J.S.A. § 2C:41-1 et seq., and the United States RICO Act, 18 U.S.C. § 1961 et seq., (collectively the “RICO claims”). See Compl. at ¶¶ 276-94; Br. in Supp. of Mot. to Dismiss Pl.’s RICO Claims (“Defs.’ Mot”) 1, ECF No. 126-1. Dicker joins the motion. See Letter, ECF No. 127. Sunrise argues that, in light of the Supreme Court’s recent ruling in RJR Nabisco, Inc. v. European Cmty., — U.S. -, 136 S.Ct. 2090, 195 L.Ed.2d 476 (2016), Plaintiffs RICO claims fail as a matter of law because Plaintiff cannot show that it suffered a “domestic injury” to its business or property. See Defs.’ Mot. at 3. In applying a legal test adopted by the Southern District of New York, Sunrise asserts that any injury to Plaintiff occurred in Turkey because Plaintiff maintained no business operations in the United States and Plaintiff relinquished possession of its goods when it delivered them to a third-party shipper in Turkey. See id at 10-12.

Plaintiff responds that the RJR decision is distinguishable because all of the alleged RICO predicate acts in RJR occurred in Europe, whereas all of the predicate acts in the instant case occurred in the United States. See Pl.’s Br. in Opp’n to the Mot. to Dismiss (“Pl.’s Opp’n”) 6-7, ECF No. 134. Furthermore, the RJR plaintiffs waived their damages claims to domestic injuries. Id Second, Plaintiff argues that its domestic property was injured because of losses it incurred as a result of its inability to satisfy a judgment that it obtained in 2011 against an entity connected to the RICO enterprise. See id. at 7-10. Third, in applying a different test established by the Central District of California, Plaintiff argues that this Court should look to where nearly all of the unlawful conduct took place—i.e., the United States—in determining where the economic injury occurred. See id at 13-15. Finally, Plaintiff asserts that its domestic business was injured because it had approximately $1 million of annual sales to customers in the United States prior to transacting with the RICO enterprise. See id at 16,

In its reply, Sunrise counters that the case upon which Plaintiff relies is an outlier from the multitude .of other district court decisions applying the RJR holding and is otherwise distinguishable from the instant case because the plaintiff in that case maintained substantial business operations within the United States. See Reply Br. in Further Supp. of Mot. to Dismiss PL’s RICO Claims (“Defs.’ Reply”) 4-8, ECF No. 135. Sunrise argues that Plaintiffs claim of damage to its domestic business fails because, it never maintained any business operations within the United States and, therefore, cannot allege damage to a United States-based business operation. See id at 9-10. Sunrise further argues that Plaintiffs claim of damage to its judgment as property fails because it is a “downstream effect” of Plaintiffs initial [654]*654injury. See id. at 12. Moreover, Plaintiffs judgment concerns only one transaction between Sunrise and Cavusoglu, which does not satisfy a pattern of racketeering as required, by law, and Plaintiffs “lost-debt” theory of damages is not yet cognizable before the Court. See id. at 13-15. Dicker joins Sunrise’s arguments in reply and further asserts that any RICO claim against him fails because he has had no relationship or involvement with any of the parties since 2007. See Letter, ECF No. 136. Sunrise notes, and Plaintiff does not contest, that the New Jersey RICO statute is nearly identical to the federal RICO statute. See Defs.’ Mot. at 3 n.2. The Court, therefore, will consider both claims together.

II. LEGAL STANDARD

Pursuant to Federal Rule of Civil Procedure

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Bluebook (online)
245 F. Supp. 3d 650, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cevdet-aksut-ogullari-koll-sti-v-cavusoglu-njd-2017.