Life Savers Concepts Ass'n of Cal. v. Wynar

387 F. Supp. 3d 989
CourtDistrict Court, N.D. California
DecidedMay 16, 2019
DocketCase No. 18-CV-02252-LHK
StatusPublished
Cited by6 cases

This text of 387 F. Supp. 3d 989 (Life Savers Concepts Ass'n of Cal. v. Wynar) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Life Savers Concepts Ass'n of Cal. v. Wynar, 387 F. Supp. 3d 989 (N.D. Cal. 2019).

Opinion

LUCY H. KOH, United States District Judge

Plaintiffs Life Savers Concepts Association of California ("Life Savers"), Lupita Chavez, Rito Chavez, Raquel Chavez, and Esequiel Lombera (collectively, "Individual Plaintiffs") bring suit against various Doe Defendants as well as Defendant Roahn Wynar ("Wynar"), a Federal Bureau of Investigation ("FBI") agent, in his personal and official capacities in connection with an FBI investigation into Life Savers' business operations (collectively, "Defendants"). Before the Court is Wynar's motion to dismiss the first amended complaint. ECF No. 47 ("Mot."). Having considered the submissions of the parties, the relevant law, and the record in this case, the Court GRANTS in Part and DENIES in Part Wynar's motion to dismiss.

*993I. BACKGROUND

A. Factual Background

In July 2012, Life Savers was founded, incorporated as a North Carolina corporation, and then registered with the California Secretary of State to do intrastate business in California. ECF No. 44 ("first amended complaint," or "FAC") at ¶¶ 1-2. Life Savers did business by entering into membership agreements with homeowners. Id. at ¶ 3. Members transferred and assigned to Life Savers members' claims relating to their home loans so that Life Savers could bring suit against lenders seeking to foreclose on members' homes. Id. at ¶ 6. Most of the members also executed grant deeds that transferred to Life Savers a 5% ownership interest in members' real property securing their home loans. Id. at ¶ 3. Between March 29, 2013 and December 10, 2015, Life Savers assigned all of its required rights to Larry Brown. Id. at ¶¶ 4-5. "Based on these assignments, Brown claims to hold a 5 percent ownership interest in each of the properties that secured the home loans of the members." Id. at ¶ 5. The Office of the Monterey County District Attorney and the FBI have investigated Life Savers for fraud since at least 2014. Id. at ¶ 7. Individual Plaintiffs Lupita, Rito, Raquel, and Esequiel1 are alleged to be Life Savers' employees. Id. at ¶¶ 20, 24-25.

The Court first discusses the FBI's execution of a search warrant at Life Savers' Sunnyvale office, then discusses Wynar's subsequent contact with Life Savers' Members.

1. FBI's Execution of a Search Warrant

On the morning of July 11, 2017, Wynar and several other FBI agents executed a search warrant on Life Savers' Sunnyvale, California office. Id. at ¶ 19. Wynar knocked on the door to Life Saver's office. Id. at 20. Plaintiffs Lupita, Rito, and Raquel, "who all reside in the adjoining living quarters were dressing or still in bed." Id. at ¶ 20. Eventually, Raquel answered the door. Wynar and the FBI team entered the building and proceeded to attempt to open office doors, which were locked. Id. at ¶ 21. Wynar asked Raquel why the doors were locked and who was present in the building. Id. at ¶ 21. Raquel answered that the office doors were locked because Life Savers opened at 11:00 a.m., and it was only around 9:30 a.m. when Wynar arrived with his team. Id. at ¶ 21. Raquel also informed Wynar that there were 3 more people in the back rooms. Id. Wynar asked Raquel why Raquel was sleeping in Life Savers' office, to which Raquel replied that all the Individual Plaintiffs had resided at the office for about 3 years. Id. at ¶ 22.

At that point, 30 FBI agents with guns drawn entered the office, and Wynar told Raquel that the FBI was there to execute a "search warrant for documents and computers related to Life Savers." Id. at ¶ 23. Wynar stated that he would give Raquel a copy of the search warrant later. Id. Wynar asked for keys to all the offices, and Raquel complied. Id. at ¶ 24. Afterwards, "Wynar grabbed Esequiel Lombera with great force, pushed him against the wall with force, twisted his arm, searched and handcuffed him with his hands behind his back and ordered him to face the wall." Id. Wynar also grabbed Rito, twisted Rito's hands and handcuffed Rito with Rito's hands behind his back, and ordered Rito to face the wall. Id. At that point in time, Plaintiffs allege that 20 more agents entered *994the Life Savers office with guns drawn and began to search the offices. Id.

The FBI prevented any of the Individual Plaintiffs from leaving, kept Rito and Esequiel handcuffed and facing the wall, and prevented the employees from using their cellphones or the office phones. Id. at ¶ 26. None of the Individual Plaintiffs were Mirandized. Id. Raquel asked to use the bathroom, but Wynar told Raquel to wait. Raquel asked to use the bathroom twice more, and on the third request, which was "nearly one hour from the first request," Wynar allowed Raquel to use the bathroom. Id. By that point, Rito and Esequiel had been handcuffed for over 30 minutes. Id.

Soon after, Wynar uncuffed Rito and Esequiel and had all the Individual Plaintiffs go to the front desk with Wynar and "Arlette," an Internal Revenue Service ("IRS") agent. Id. at ¶ 27. Wynar instructed another FBI agent to take Rito's, Lupita's, and Esequiel's identification cards. Id. Lupita, Rito, and Esequiel were told to leave, but Raquel was not permitted to leave and was told to sit down. Id. at ¶ 28. As Rito was leaving, he realized that 5 members who were coming to the Life Savers office were being questioned by FBI agents and told that Life Savers was a scam. Id. Raquel, who was not permitted to leave, was then interrogated by Arlette, the IRS agent, and Wynar. Id. at ¶¶ 29-32. Eventually, as the government agents completed their search, Wynar handed Raquel back her keys, the search warrant, and a Receipt for Property that documented all the items the agents seized. Id. at ¶ 35.

2. Wynar's Subsequent Contact with Life Savers' Members

In November 2017, Wynar spoke to Life Savers member Margaret Marroquin. Id. at ¶¶ 36-37. Wynar presented Marroquin with a copy of a check Marroquin wrote to pay her Life Savers membership dues. Id. at ¶ 37. Among other things, Wynar asked whether Marroquin knew how the money was being used. Id. Marroquin responded that she did not know how the money was used. In addition, Wynar asked Marroquin if she knew that Larry Brown was using Life Savers' members' money to buy drugs, expensive cars, jewelry for his girlfriend, trips, and alcohol. Id. at ¶ 38. Marroquin asked if Brown had been sued, to which Wynar responded that the government was still looking for evidence against the alleged scam before suing anyone. Id.

On March 28, 2018, Wynar telephoned another Life Savers member, Rosalinda Aceves, and left a voicemail. Id. at ¶ 40. Aceves returned Wynar's call that same day. Id. On the call, Wynar told Aceves that she was a victim of fraud, and Wynar also wanted to know whether Aceves gave Brown any money. Id. Aceves initially denied that she gave Brown any money, but Aceves eventually realized that Wynar was "referring to the money she had refinanced from her home." Id. at ¶ 41.

On April 8, 2018, Wynar stood outside a Life Savers meeting in San Jose, California. Id. at ¶ 42.

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387 F. Supp. 3d 989, Counsel Stack Legal Research, https://law.counselstack.com/opinion/life-savers-concepts-assn-of-cal-v-wynar-cand-2019.