1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 SOLID INCOME LIMITED, et al., 8 Plaintiffs, Case No. 24-cv-09424-HSG 9 v. Re: Dkt. No. 18
10 AMERICAN HOMEENERGY LLC, et al., 11 Defendants. ORDER DENYING MOTIONS TO DISMISS 12 SOLID INCOME LIMITED, 13 Plaintiff, Case No. 24-cv-09422-HSG 14 v. 15 Re: Dkt. No. 17 ENERGYINVEST LLC, et al., 16 Defendants. 17 18 Pending before the Court are Defendants’ motions to dismiss Plaintiffs’ complaints in two 19 related fraudulent transfer actions. See Dkt. No. 17 in 24-cv-9422; Dkt. No. 18 in 24-cv-9424. 20 The Court finds these matters appropriate for disposition without oral argument and the matters 21 are deemed submitted. See Civil L.R. 7-1(b). For the reasons discussed below, the Court denies 22 the motions to dismiss. 23 I. BACKGROUND 24 These actions arise from a series of allegedly fraudulent financial transactions, which have 25 already been litigated in federal court. This prior litigation concerns two loans provided to 26 Defendant Thomas Enzendorfer. 27 First, in January 2018, a limited liability company, AEC Yield, provided over ten million 1 No. 24-9424. Mr. Enzendorfer allegedly transferred those assets to a series of shell companies in 2 violation of his agreement with AEC Yield. Id. AEC Yield brought breach of contract claims in 3 the Eastern District of New York, and judgment was ultimately entered in favor of AEC Yield in 4 the amount of $22,111,363.46. Id. As alleged, AEC Yield assigned its interest in the judgment to 5 Solid Income and CCY III, the Plaintiffs in this matter. 6 Second, in December 2020, Plaintiff Solid Income loaned $1,750,000 to Mr. Enzendorfer 7 and his limited liability company EnergyInvest. Dkt. No. 1 in Case No. 24-9422. After Mr. 8 Enzendorfer allegedly misappropriated the loan by transferring it to various shell entities, the 9 parties entered arbitration. On January 10, 2024, a federal judge in the Southern District of New 10 York confirmed an arbitration award of $2,152,594.79 in favor of Solid Income and entered 11 judgment. Id. 12 Plaintiffs now seek to recover (1) the Eastern District of New York judgment, and (2) the 13 Southern District of New York arbitration award. Here, they bring a common law fraudulent 14 transfer claim under California law, as well as claims for voidable transfer under California Civil 15 Code sections 3439.04(a)(1) and 3439.04(a)(2). Defendants move to dismiss all three claims. 16 II. REQUEST FOR JUDICIAL NOTICE 17 Along with their motions to dismiss, Defendants filed requests for judicial notice. See Dkt. 18 Nos. 22, 29-1 in 24-9424; Dkt. Nos. 21, 29-1 in 24-9422. The Court denies the requests. 19 A. Legal Standard 20 As a general matter, district courts may not consider material outside the pleadings when 21 assessing the sufficiency of a complaint under Rule 12(b)(6). Lee v. City of Los Angeles, 250 22 F.3d 668, 688 (9th Cir. 2001). However, there are two exceptions to this rule: the incorporation- 23 by-reference doctrine and judicial notice under Federal Rule of Evidence 201. See Khoja v. 24 Orexigen Therapeutics, Inc., 899 F.3d 988, 998 (9th Cir. 2018). Both procedures permit district 25 courts to consider materials outside a complaint without converting a motion to dismiss into a 26 summary judgment. Id.; see Lee, 250 F.3d at 688–89. 27 The incorporation by reference doctrine is a judicially created doctrine that allows a court 1 1002. This is to prevent a plaintiff from cherry-picking certain portions of documents that support 2 her claims, while omitting portions that weaken her claims. Id. Incorporation by reference is 3 appropriate “if the plaintiff refers extensively to the document or the document forms the basis of 4 plaintiff's claim.” Id. However, “the mere mention of the existence of a document is insufficient 5 to incorporate the contents” of a document. Id. Under the incorporation-by-reference doctrine, a 6 court may consider evidence on which the complaint “necessarily relies” if: (1) the complaint 7 refers to the document; (2) the document is central to the plaintiff’s claim; and (3) no party 8 questions the authenticity of the copy attached to the 12(b)(6) motion. Marder v. Lopez, 450 F.3d 9 445, 448 (9th Cir. 2006). If these conditions are met, the court may treat such a document as part 10 of the complaint and may assume the truth of the document's contents for purposes of a motion to 11 dismiss under Rule 12(b)(6). Daniels-Hall v. Nat’l Educ. Ass’n, 629 F.3d 992, 998 (9th Cir. 12 2010). However, while a court “may assume [an incorporated document’s] contents are true for 13 purposes of a motion to dismiss . . . it is improper to assume the truth of an incorporated document 14 if such assumptions only serve to dispute facts stated in a well-pleaded complaint.” Khoja, 899 15 F.3d at 1002. 16 Federal Rule of Evidence 201(b) permits a court to notice an adjudicative fact if it is “not 17 subject to reasonable dispute because it: (1) is generally known within the trial court's territorial 18 jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy cannot 19 reasonably be questioned.” Fed. R. Evid. 201(b). In Khoja, the Ninth Circuit discussed the 20 judicial notice rule and incorporation by reference doctrine, noting that a court may take “judicial 21 notice of matters of public record,” but “cannot take judicial notice of disputed facts contained in 22 such public records.” 899 F.3d at 999 (citation and quotations omitted). The Ninth Circuit has 23 held that if a court takes judicial notice of a document, it must specify what facts it judicially 24 notices from the document. Id. Further, “[j]ust because the document itself is susceptible to 25 judicial notice does not mean that every assertion of fact within that document is judicially 26 noticeable for its truth.” Id. As an example, the Ninth Circuit held that for a transcript of a 27 conference call, the court may take judicial notice of the fact that there was a conference call on 1 the substance “is subject to varying interpretations, and there is a reasonable dispute as to what the 2 [document] establishes.” Id. at 999–1000. 3 B. Analysis 4 Defendants ask the Court to take judicial notice of several facts and documents that largely 5 concern the parties’ prior litigation. 6 Consistent with Federal Rule of Evidence 201, “[a] request for judicial notice must 7 normally describe both the matter for which the party seeks judicial notice and the basis for 8 judicial notice, that is, why the matter’s accuracy is not subject to reasonable dispute.” Moreno v. 9 Ross Island Sand & Gravel Co., No. 2:13-CV-00691-KJM, 2015 WL 5604443, at *1 (E.D. Cal. 10 Sept. 23, 2015) (citing Fed. R. Evid. 201 (c)(2)). Moreover, the “party requesting judicial notice 11 bears the burden of persuading the trial judge that the fact is proper for judicial notice.” Corsini v. 12 Canyon Equity, LLC, No. C 10-2061 JL, 2011 WL 13247445, at *5 (N.D. Cal. Feb. 14, 2011). 13 See Harrison v. Milligan, No. C 09-4665 SI PR, 2012 WL 1835428, at *1 (N.D. Cal.
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1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 SOLID INCOME LIMITED, et al., 8 Plaintiffs, Case No. 24-cv-09424-HSG 9 v. Re: Dkt. No. 18
10 AMERICAN HOMEENERGY LLC, et al., 11 Defendants. ORDER DENYING MOTIONS TO DISMISS 12 SOLID INCOME LIMITED, 13 Plaintiff, Case No. 24-cv-09422-HSG 14 v. 15 Re: Dkt. No. 17 ENERGYINVEST LLC, et al., 16 Defendants. 17 18 Pending before the Court are Defendants’ motions to dismiss Plaintiffs’ complaints in two 19 related fraudulent transfer actions. See Dkt. No. 17 in 24-cv-9422; Dkt. No. 18 in 24-cv-9424. 20 The Court finds these matters appropriate for disposition without oral argument and the matters 21 are deemed submitted. See Civil L.R. 7-1(b). For the reasons discussed below, the Court denies 22 the motions to dismiss. 23 I. BACKGROUND 24 These actions arise from a series of allegedly fraudulent financial transactions, which have 25 already been litigated in federal court. This prior litigation concerns two loans provided to 26 Defendant Thomas Enzendorfer. 27 First, in January 2018, a limited liability company, AEC Yield, provided over ten million 1 No. 24-9424. Mr. Enzendorfer allegedly transferred those assets to a series of shell companies in 2 violation of his agreement with AEC Yield. Id. AEC Yield brought breach of contract claims in 3 the Eastern District of New York, and judgment was ultimately entered in favor of AEC Yield in 4 the amount of $22,111,363.46. Id. As alleged, AEC Yield assigned its interest in the judgment to 5 Solid Income and CCY III, the Plaintiffs in this matter. 6 Second, in December 2020, Plaintiff Solid Income loaned $1,750,000 to Mr. Enzendorfer 7 and his limited liability company EnergyInvest. Dkt. No. 1 in Case No. 24-9422. After Mr. 8 Enzendorfer allegedly misappropriated the loan by transferring it to various shell entities, the 9 parties entered arbitration. On January 10, 2024, a federal judge in the Southern District of New 10 York confirmed an arbitration award of $2,152,594.79 in favor of Solid Income and entered 11 judgment. Id. 12 Plaintiffs now seek to recover (1) the Eastern District of New York judgment, and (2) the 13 Southern District of New York arbitration award. Here, they bring a common law fraudulent 14 transfer claim under California law, as well as claims for voidable transfer under California Civil 15 Code sections 3439.04(a)(1) and 3439.04(a)(2). Defendants move to dismiss all three claims. 16 II. REQUEST FOR JUDICIAL NOTICE 17 Along with their motions to dismiss, Defendants filed requests for judicial notice. See Dkt. 18 Nos. 22, 29-1 in 24-9424; Dkt. Nos. 21, 29-1 in 24-9422. The Court denies the requests. 19 A. Legal Standard 20 As a general matter, district courts may not consider material outside the pleadings when 21 assessing the sufficiency of a complaint under Rule 12(b)(6). Lee v. City of Los Angeles, 250 22 F.3d 668, 688 (9th Cir. 2001). However, there are two exceptions to this rule: the incorporation- 23 by-reference doctrine and judicial notice under Federal Rule of Evidence 201. See Khoja v. 24 Orexigen Therapeutics, Inc., 899 F.3d 988, 998 (9th Cir. 2018). Both procedures permit district 25 courts to consider materials outside a complaint without converting a motion to dismiss into a 26 summary judgment. Id.; see Lee, 250 F.3d at 688–89. 27 The incorporation by reference doctrine is a judicially created doctrine that allows a court 1 1002. This is to prevent a plaintiff from cherry-picking certain portions of documents that support 2 her claims, while omitting portions that weaken her claims. Id. Incorporation by reference is 3 appropriate “if the plaintiff refers extensively to the document or the document forms the basis of 4 plaintiff's claim.” Id. However, “the mere mention of the existence of a document is insufficient 5 to incorporate the contents” of a document. Id. Under the incorporation-by-reference doctrine, a 6 court may consider evidence on which the complaint “necessarily relies” if: (1) the complaint 7 refers to the document; (2) the document is central to the plaintiff’s claim; and (3) no party 8 questions the authenticity of the copy attached to the 12(b)(6) motion. Marder v. Lopez, 450 F.3d 9 445, 448 (9th Cir. 2006). If these conditions are met, the court may treat such a document as part 10 of the complaint and may assume the truth of the document's contents for purposes of a motion to 11 dismiss under Rule 12(b)(6). Daniels-Hall v. Nat’l Educ. Ass’n, 629 F.3d 992, 998 (9th Cir. 12 2010). However, while a court “may assume [an incorporated document’s] contents are true for 13 purposes of a motion to dismiss . . . it is improper to assume the truth of an incorporated document 14 if such assumptions only serve to dispute facts stated in a well-pleaded complaint.” Khoja, 899 15 F.3d at 1002. 16 Federal Rule of Evidence 201(b) permits a court to notice an adjudicative fact if it is “not 17 subject to reasonable dispute because it: (1) is generally known within the trial court's territorial 18 jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy cannot 19 reasonably be questioned.” Fed. R. Evid. 201(b). In Khoja, the Ninth Circuit discussed the 20 judicial notice rule and incorporation by reference doctrine, noting that a court may take “judicial 21 notice of matters of public record,” but “cannot take judicial notice of disputed facts contained in 22 such public records.” 899 F.3d at 999 (citation and quotations omitted). The Ninth Circuit has 23 held that if a court takes judicial notice of a document, it must specify what facts it judicially 24 notices from the document. Id. Further, “[j]ust because the document itself is susceptible to 25 judicial notice does not mean that every assertion of fact within that document is judicially 26 noticeable for its truth.” Id. As an example, the Ninth Circuit held that for a transcript of a 27 conference call, the court may take judicial notice of the fact that there was a conference call on 1 the substance “is subject to varying interpretations, and there is a reasonable dispute as to what the 2 [document] establishes.” Id. at 999–1000. 3 B. Analysis 4 Defendants ask the Court to take judicial notice of several facts and documents that largely 5 concern the parties’ prior litigation. 6 Consistent with Federal Rule of Evidence 201, “[a] request for judicial notice must 7 normally describe both the matter for which the party seeks judicial notice and the basis for 8 judicial notice, that is, why the matter’s accuracy is not subject to reasonable dispute.” Moreno v. 9 Ross Island Sand & Gravel Co., No. 2:13-CV-00691-KJM, 2015 WL 5604443, at *1 (E.D. Cal. 10 Sept. 23, 2015) (citing Fed. R. Evid. 201 (c)(2)). Moreover, the “party requesting judicial notice 11 bears the burden of persuading the trial judge that the fact is proper for judicial notice.” Corsini v. 12 Canyon Equity, LLC, No. C 10-2061 JL, 2011 WL 13247445, at *5 (N.D. Cal. Feb. 14, 2011). 13 See Harrison v. Milligan, No. C 09-4665 SI PR, 2012 WL 1835428, at *1 (N.D. Cal. May 21, 14 2012) (“The party requesting judicial notice bears the burden of persuading the court that the 15 particular fact is not reasonably subject to dispute and is capable of immediate and accurate 16 determination by resort to a source whose accuracy cannot reasonably be questioned.”); Newman 17 v. San Joaquin Delta Cmty. Coll. Dist., 272 F.R.D. 505, 516 (E.D. Cal. 2011) (denying request for 18 judicial notice where the moving party did not “state any authorities or factual bases for judicially 19 noticing the [requested materials]”). Here, Defendants have not met their burden. Defendants’ 20 requests for judicial notice provide minimal context for each request and present no argument or 21 explanation as to why the materials should be judicially noticed. Accordingly, since Defendants 22 have not carried their burden under Rule 201, the requests for judicial notice are denied. 23 III. MOTION TO DISMISS 24 A. Legal Standard 25 Federal Rule of Civil Procedure 8(a) requires that a complaint contain “a short and plain 26 statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). A 27 defendant may move to dismiss a complaint for failing to state a claim upon which relief can be 1 complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” 2 Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). To survive a Rule 3 12(b)(6) motion, a plaintiff need only plead “enough facts to state a claim to relief that is plausible 4 on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible 5 when a plaintiff pleads “factual content that allows the court to draw the reasonable inference that 6 the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 7 In reviewing the plausibility of a complaint, courts “accept factual allegations in the complaint as 8 true and construe the pleadings in the light most favorable to the nonmoving party.” Manzarek v. 9 St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). Nevertheless, courts do not 10 “accept as true allegations that are merely conclusory, unwarranted deductions of fact, or 11 unreasonable inferences.” In re Gilead Scis. Secs. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008) 12 (citation and quotations omitted). 13 When fraud is an essential element of a claim, Rule 9(b) imposes a heightened pleading 14 standard. See Fed. R. Civ. P. 9(b) (“In alleging fraud or mistake, a party must state with 15 particularity the circumstances constituting fraud or mistake.”); see also Vess v. Ciba–Geigy Corp. 16 USA, 317 F.3d 1097, 1107 (9th Cir. 2003). A plaintiff must identify “the who, what, when, where, 17 and how” of the alleged conduct to provide defendants with sufficient information to defend 18 against the charge. Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997) (citation and quotations 19 omitted). However, “[m]alice, intent, knowledge, and other conditions of a person’s mind may be 20 alleged generally.” Fed. R. Civ. P. Rule 9(b). Even if the court concludes that a 12(b)(6) motion 21 should be granted, the “court should grant leave to amend even if no request to amend the pleading 22 was made, unless it determines that the pleading could not possibly be cured by the allegation of 23 other facts.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en banc) (citation and 24 quotations omitted). 25 B. Discussion 26 Defendants seek dismissal on several grounds, including (1) for lack of subject matter 27 jurisdiction under Federal Rule of Civil Procedure Rule 12(b)(1), (2) as a matter of law based on 1 double recovery, and (4) for failure to state a claim under Federal Rule of Civil Procedure Rule 2 9(b). 3 i. Lack of Subject Matter Jurisdiction 4 Under Federal Rule of Civil Procedure 12(b)(1), a party may move to dismiss based on the 5 court’s lack of subject matter jurisdiction. See Fed. R. Civ. P. 12(b)(1). “Subject matter 6 jurisdiction can never be forfeited or waived and federal courts have a continuing independent 7 obligation to determine whether subject matter jurisdiction exists.” See Leeson v. Transam. 8 Disability Income Plan, 671 F.3d 969, 975, n.12 (9th Cir. 2012) (quotation omitted). The party 9 invoking subject matter jurisdiction has the burden of establishing that such jurisdiction exists. 10 See Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992). 11 A challenge pursuant to Rule 12(b)(1) may be “facial” or “factual.” See White v. Lee, 227 12 F.3d 1214, 1242 (9th Cir. 2000). As relevant here, in a factual challenge, “‘the challenger disputes 13 the truth of the allegations that, by themselves, would otherwise invoke federal jurisdiction.’” 14 Wood v. City of San Diego, 678 F.3d 1075, 1083 n.8 (9th Cir. 2012) (quoting Safe Air For 15 Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004)). Once challenged, the plaintiff must 16 support her jurisdictional allegations with “competent proof.” Hertz Corp. v. Friend, 559 U.S. 77, 17 96–97 (2010). To resolve a factual attack, the court need not “presume the truthfulness of the 18 plaintiff’s allegations” and “‘may review evidence beyond the complaint without converting the 19 motion to dismiss into a motion for summary judgment.’” Wood, 678 F.3d at 1083 n.8 (quoting 20 Safe Air, 373 F.3d at 1039). However, a court should not resolve factual issues when “the 21 jurisdictional issue and substantive claims are so intertwined that resolution of the jurisdictional 22 question is dependent on factual issues going to the merits.” Autery v. United States, 424 F.3d 23 944, 956 (9th Cir. 2005). In such cases, the court must “leave the resolution of material factual 24 disputes to the trier of fact.” Bowen v. Energizer Holdings, Inc., 118 F.4th 1134, 1143 (9th Cir. 25 2024). 26 a. Entity Registration Status 27 Defendants first bring a factual attack under Rule 12(b)(1), arguing that Plaintiffs Solid 1 Plaintiffs, for their part, provide the Court with “Certificates of Good Standing” from the Registry 2 of Companies in the Cayman Islands, which state that “Solid Income Ltd” and “Constant Cash 3 Yield III Ltd.” are “existing” companies in “good standing” in the Cayman Islands. Dkt. No. 28-1 4 in Case Nos. 24-9424, 24-9422. In response, Defendants contend that “no reasonable person 5 would think ‘CCY III’ and ‘Constant Cash Yield III Ltd.’ are the same entity,” and that “‘Solid 6 Income Limited’ and ‘Solid Income Ltd.’ are not the same entity under Cayman Islands Law.” 7 Dkt. No. 29 at 11 in Case No. 24-9424; Dkt. No. 29 at 9 in Case No. 24-9422. At this stage, and 8 given the evidence before it, the Court finds that Plaintiffs have supplied “competent proof” that 9 Solid Income Limited and CCY III are actual entities in the Cayman Islands. Leite v. Crane Co., 10 749 F.3d 1117, 1122 (9th Cir. 2014). That being said, the Court has an ongoing duty to assess 11 whether subject matter jurisdiction exists and may consider the issue sua sponte later. See 12 Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583 (1999). Defendants are entitled move to 13 dismiss under Rule 12(b)(1) at any stage in the litigation and may choose to do so again here if, 14 for example, new evidence is discovered.1 15 b. Assignment Validity 16 Defendants next assert that Plaintiffs lack standing because they are not the proper 17 assignees of the Eastern District of New York judgment. Dkt. No. 18 at 20 in Case No. 24-9424. 18 Specifically, Defendants argue that since Plaintiffs have not met the requirements of California’s 19 Code of Civil Procedure (“CCP”), they do not “own the Judgment against American Home 20 Energy, Inc.” Id. at 21. 21 “Title 9 of part 2 of the Code of Civil Procedure (§§ 680.010–724.260) is known as the 22 Enforcement of Judgments Law.” Conservatorship of McQueen, 59 Cal. 4th 602, 607 (2014). 23 CCP section 681.020 prescribes the requirements for an assignee to enforce a judgment under this 24 title. Under section 681.020, “[a]n assignee of a judgment is not entitled to enforce the judgment 25 under this title unless an acknowledgment of assignment of judgment to that assignee has been 26 1 Since Defendants’ arguments regarding Solid Income’s parent corporation appear contingent on 27 Solid Income not existing as a legitimate entity, the Court declines to address that issue. See Dkt. 1 filed under [s]ection 673 or the assignee has otherwise become an assignee of record.” CCP 2 section 673 sets out the requirements for becoming an assignee of record. “These statutes, read 3 together, specify requirements for an assignee to obtain standing as a judgment creditor to enforce 4 a judgment under the Enforcement of Judgments Law.” California Coastal Com. v. Allen, 167 5 Cal. App. 4th 322, 327 (2008). Here, the parties dispute whether Plaintiffs’ claims were brought 6 under or are subject to California’s Enforcement of Judgments Law, such that CCP sections 673 7 and 681.020 apply to the claims. 8 The plain language of Plaintiffs’ complaint shows that their fraudulent transfer claims are 9 brought under California’s Uniform Voidable Transactions Act (“UVTA”), Cal. Civ. Code § 10 3439.04(a)(1), (2). See, e.g., Dkt. No. 1 in Case No. 24-9424. At issue, then, is whether 11 fraudulent transfer actions brought under the UVTA are subject to the assignment requirements set 12 out in California’s Enforcement of Judgments Law. Defendants cite just one case— 13 Conservatorship of McQueen, 59 Cal. 4th 602 (2014)—to support their contention that UVTA 14 fraudulent transfer claims are “enforcement of judgment” actions governed by the Enforcement of 15 Judgments Law. That case, which concerns whether the Enforcement of Judgments Law’s 16 attorneys’ fees provision applies to a fraudulent transfer action, does not address whether the 17 underlying action was brought under the UTVA, nor does it address the Enforcement of 18 Judgments Law’s assignment provisions. Accordingly, absent definitive case law in support of its 19 claim, the Court declines to adopt Defendants’ assignment position, and declines to dismiss on this 20 basis. 21 ii. Dismissal as a Matter of Law 22 Defendants next argue that the Court should dismiss Plaintiffs’ complaints as a matter of 23 law because (1) the initial transfer was not fraudulent, and (2) the transfers at issue fall outside the 24 statute of limitations. Both arguments are grounded in fact-intensive inquiries that the Court will 25 not resolve at the pleading stage. 26 The parties here dispute when the statute of limitations began to run and which transaction 27 or judgment started this clock. See Dkt. No. 18 at 12 and Dkt. No. 28 at 12 in Case No. 24-9424; 1 process, statute of limitations defenses may not be raised by motion to dismiss unless they include 2 no disputed issues of fact.” In re California Bail Bond Antitrust Litig., No. 19-CV-00717-JST, 3 2020 WL 3041316, at *17 (N.D. Cal. Apr. 13, 2020) (internal citation and quotations omitted); see 4 Supermail Cargo, Inc. v. United States, 68 F.3d 1204, 1206 (9th Cir. 1995); Hightower v. 5 Celestron Acquisition, LLC, No. 5:20-CV-03639-EJD, 2021 WL 2224148, at *6 (N.D. Cal. June 6 2, 2021). Since the statute of limitations dispute here “require[s] a fact-intensive investigation that 7 is inappropriate on a motion to dismiss,” the Court declines to dismiss on this basis at this stage in 8 the litigation. 24/7 Customer, Inc. v. 24-7 Intouch, No. 5:14-CV-02561-EJD, 2015 WL 1522236, 9 at *4 (N.D. Cal. Mar. 31, 2015). 10 The parties’ disagreement as to whether the initial transfer was indeed fraudulent is 11 similarly fact-intensive. Defendants rely, for example, on the contents of the loan agreement 12 between Mr. Enzendorfer and EnergyInvest LLC to substantiate their claim that EnergyInvest’s 13 December 2020 transfer was not fraudulent. Dkt. No. 17 at 22 in Case No. 24-9422. But the loan 14 agreement is not before the Court. At this stage, the Court’s “inquiry is limited to the content of 15 the complaint.” N. Star Int’l v. Arizona Corp. Comm’n, 720 F.2d 578, 581 (9th Cir. 1983). 16 Defendants also point to representations by Patric Wisard. See Dkt. No. 17 at 23 in Case No. 24- 17 9422. These representations are entirely absent from the complaint. Evaluating them at this stage 18 would turn Defendants’ motion to dismiss into a motion for summary judgment. The Court 19 therefore declines to dismiss the complaint as a matter of law. 20 iii. Double Recovery 21 Defendants assert that American Home Energy Inc. and EnergyInvest LLC must be 22 dismissed as parties in these suits because Plaintiffs are not entitled to recover damages from them 23 under Renda v. Nevarez, 223 Cal. App. 4th 1231 (2014). Plaintiffs argue that both companies are 24 proper defendants because Plaintiffs seek to recover additional forms of relief from them, rather 25 than a second judgment for the same debt. 26 Under Renda, in a fraudulent transfer action, “a creditor cannot obtain a money judgment 27 against a debtor for the amount of the outstanding judgment because it would create two 1 1024–25 (2019). However, a creditor may seek “separate monetary damages . . . caused by the . . . 2 defendants’ post-judgment tortious conduct,” including “efforts to hinder, delay and defraud 3 [creditors] from collecting the Judgment and the resulting delay in satisfaction of judgment.” Id. 4 At issue here, then, is whether Plaintiffs seek duplicative money damages for the same harm, or 5 whether they seek additional damages for separate conduct. 6 Plaintiffs in these matters request both punitive and compensatory damages. Dkt. No. 1-1. 7 in Case No. 24-9424; Dkt. No. 1 in Case No. 24-9422. Plaintiffs’ request for punitive damages 8 constitutes a distinct form of relief from the original monetary judgment entered against 9 Defendants. The request for compensatory damages is less readily resolved, but such resolution is 10 not necessary at this stage. See Logtale, Ltd. v. Canton, No. 20-CV-01207-DMR, 2020 WL 11 4464907, at *6 (N.D. Cal. Aug. 3, 2020) (declining to decide at the motion to dismiss stage what 12 monetary relief might be appropriate under Renda); Attebury Grain LLC v. Cortez, 794 F. App’x 13 674 (9th Cir. 2020) (holding that the “compensatory damages award in this second fraudulent 14 transfer action did not constitute an impermissible double recovery”). Accordingly, the Court will 15 await further factual development in this case before deciding whether Plaintiffs’ request for 16 “[c]ompensatory damages in the amount equal to the Judgment” could give rise to an 17 impermissible double recovery. 18 iv. Failure to State a Claim 19 Finally, Defendants argue that Plaintiffs’ complaints contain “conclusory and speculative 20 allegations” that do “not meet the particularity or plausibility requirements of FRCP 8 or FRCP 21 9(b).” Dkt. No. 18 in Case No. 24-9424. The Court disagrees. 22 “A fraudulent transfer under the UVTA is a transfer by the debtor of property to a third 23 person undertaken with the intent to prevent a creditor from reaching that interest to satisfy its 24 claim.” Potter v. All. United Ins. Co., 37 Cal. App. 5th 894, 903–04 (2019) (internal citations and 25 quotations omitted). “[A] transfer can be invalid either because of actual fraud [Cal. Civ. Code § 26 3439.04(a)(1)] or constructive fraud [Cal. Civ. Code § 3439.04(a)(2)].” Id. Here, Plaintiffs bring 27 claims for fraudulent transfer under common law and under sections 3439.04(a)(1) and (a)(2). 1 prove what was transferred, that what was transferred is subject to avoidance under applicable law, 2 and the fair market value of what was transferred.’” Hoffman v. Morris, No. CV 17-5176 FMO 3 (KSX, 2017 WL 10438889, at *3 (C.D. Cal. Nov. 30, 2017) (quoting In re 3dfx Interactive, Inc., 4 389 B.R. 842, 864 (Bankr. N.D. Cal. 2008)). Plaintiffs allege that Defendants received and 5 exchanged assets “with the actual intent to defraud the Original Judgment Creditors and to hinder 6 and delay the Original Judgment Creditors.” Dkt. No. 1 in Case No. 24-9424. Plaintiffs further 7 allege that Defendants executed these transfers “for no discernible purpose other than to avoid 8 creditors” and assert that the “assets were apparently transferred for nothing in return,” “without 9 the entities receiving reasonably equivalent value for the assets transferred.” Id. Plaintiffs plead, 10 in sufficient detail, the specific loans that gave rise to the fraudulent transfer claims, the parties to 11 those loans, the loan dates, and amounts. Construing the allegations in the light most favorable to 12 Plaintiffs, as the Court must do at the motion to dismiss stage, Plaintiffs have established that the 13 transfers are subject to avoidance under Cal. Civil Code §§ 3439.04(a)(1) and (a)(2). 2 See Oracle 14 Am., Inc. v. Appleby, No. 16-CV-02090-JST, 2016 WL 5339799, at *9 (N.D. Cal. Sept. 22, 2016). 15 And since “the elements for a fraudulent transfer claim under common law are the same as under 16 section 3439,” the Court likewise declines to dismiss Plaintiffs’ common law fraudulent transfer 17 claim. Kelleher v. Kelleher, No. 13-CV-05450-MEJ, 2014 WL 94197, at *6 (N.D. Cal. Jan. 9, 18 2014). 19 IV. CONCLUSION 20 Defendants’ motions to dismiss, Dkt. No. 17 in 24-cv-9422; Dkt. No. 18 in 24-cv-9424, 21 are DENIED. 22 The Court further SETS a case management conference on September 23, 2025 at 2:00 23 p.m. The hearing will be held by Public Zoom Webinar. All counsel, members of the public, and 24
25 2 A fraudulent transfer occurs when a debtor “made the transfer or incurred the obligation . . . [w]ith actual intent to hinder, delay, or defraud any creditor.” Cal. Civ. Code § 3439.04(a)(1). A 26 constructive fraudulent transfer occurs when a debtor makes a transfer “[w]ithout receiving a reasonably equivalent value in exchange for the transfer or obligation, and the debtor ... [w]as 27 engaged or was about to engage in a business or a transaction for which the remaining assets of the 1 media may access the webinar information at https://www.cand.uscourts.gov/hsg. All attorneys 2 || and pro se litigants appearing for the case management conference are required to join at least 15 3 minutes before the hearing to check in with the courtroom deputy and test internet, video, and 4 || audio capabilities. The parties are further DIRECTED to file a joint case management statement 5 by September 16, 2025. 6 7 IT IS SO ORDERED. 8 || Dated: 8/26/2025 9 . ° awwoae S. GILLIAM, JR. □□ 10 United States District Judge 11 a 12
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