Wescott v. Crowe

• Court: District Court, N.D. California
• Decided: January 28, 2022
• Docket: 3:20-cv-06456
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 CARL WESCOTT, Case No. 20-cv-06456-JD

8 Plaintiff, ORDER RE MOTIONS TO DISMISS v. 9 Re: Dkt. Nos. 87, 89 10 DAVID CROWE, et al., Defendants. 11

12 13 Pro se plaintiff Carl Wescott has sued defendants David Crowe, Mike Lyonette, Jeff Rau, 14 Colin Ross, Brad Malcolm, and Michael Jimenez on several California state law claims arising out 15 of a contract to fund the purchase of a resort property in Nicaragua. Dkt. No. 82. Although all 16 defendants are represented by the same counsel, they filed two separate motions to dismiss the 17 second amended complaint (SAC) that presented nearly identical arguments. One was filed by 18 Rau and was styled as motion for judgment on the pleadings, Dkt. No. 87, 1 and the other was filed 19 on behalf of the remaining defendants under Rule 12(b)(6), Dkt. No. 89. The parties’ familiarity 20 with the record is assumed. The motions are granted in part. The Court declines the requests for 21 judicial notice, Dkt. Nos. 86 and 88. 22 The Court has serious concerns about the fact that the Judicial Council of California has 23 declared Wescott to be a vexatious litigant. Even so, this determination does not automatically 24 import into federal court. To be sure, a party’s “pattern of state court litigation” is germane to the 25 1 It is unclear to the Court why one motion was filed as a 12(c) motion and the other as a 12(b)(6) 26 motion, but the standard is the same, and the Court treats the motions together. See Friends of Gualala River v. Gualala Redwood Timber, LLC, No. 20-CV-06453-JD, 2021 WL 4053413, at *1 27 (N.D. Cal. Aug. 3, 2021) (“Rule 12(c) and Rule 12(b)(6) motions are functionally identical, and so 1 question of vexatiousness in federal court, but the Court presently does not have a record before it 2 that might warrant a similar declaration here. See Ringgold-Lockhart v. Cnty. of Los Angeles, 761 3 F.3d 1057, 1062-66 (9th Cir. 2014). Consequently, defendants’ arguments for dismissal or a bond 4 on the basis of vexatiousness are declined at this time. The Court may revisit this conclusion as 5 developments in the litigation warrant. 6 Although the SAC is not always clear, pro se pleadings are liberally construed, see 7 Erickson v. Pardus, 551 U.S. 89, 94 (2007), and the SAC contains enough facts to plausibly allege 8 a claim against Crowe and Lyonette for breach of the Settlement Agreement dated August 11, 9 2018, Dkt. No. 82-4.2 See Graham v. Wells Fargo Bank, N.A., No. 15-CV-04220-JD, 2016 WL 10 2937501, at *2 (N.D. Cal. May 20, 2016) (citing Commercial Mortg. Co. v. Reece, 89 Cal. App. 11 4th 731, 745 (2001)). Defendants proffer facts outside of the complaint to the effect that the seller 12 terminated the sale of the resort to Wescott before defendants are said to have breached. Dkt. 13 No. 89 at 6. The evidence may ultimately show that to be true, but the SAC alleges otherwise, see 14 SAC ¶¶ 79-91, and the Court accepts those allegations as true at this stage of the case. Huang v. 15 Avalanche Biotechnologies, Inc., No. 15-CV-03185-JD, 2016 WL 6524401, at *2 (N.D. Cal. Nov. 16 3, 2016) (citing Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987)). Consequently, 17 the breach of contract claim may proceed against Crowe and Lyonette. 18 The breach of contract claim is dismissed for the remaining defendants. Wescott has not 19 plausibly alleged that a contract existed between himself and Rau, Ross, Malcolm, or Jimenez. 20 Only Wescott, Crowe, and Lyonette, are parties to the Settlement Agreement, see, e.g., Dkt. No. 21 82-4 at 1, and no other contracts are in dispute. The claim is dismissed with leave to amend. 22 For the promissory fraud, promissory estoppel, and negligent misrepresentation claims 23 (Counts 2 through 4), Wescott aptly acknowledged “that more specificity and particularity would 24 be beneficial.” Dkt. No. 96 at 14-15. That must be done in the complaint itself, and not in a brief, 25 as Wescott attempted. See Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001). The 26 2 Wescott attached the same agreement to several different filings on the docket, and alternately 27 refers to it as a “funding contract,” Dkt. No. 96 at 10, a “sales contract,” id. at 11, and “closing 1 Court “may not consider any material beyond the pleadings,” such as facts alleged in an opposition 2 brief, in ruling on a Rule 12(b)(6) motion. Jd. (internal quotations and citations omitted). Wescott 3 || may amend the complaint to include additional factual allegations, with an eye toward Rule 9(b)’s 4 || pleading requirements for claims sounding in fraud. 5 For the claims for tortious and negligent interference with contractual relations and 6 || intentional and negligent interference with prospective economic advantage (Counts 5 through 8), 7 || it may be, as Wescott suggests, that pertinent facts “will emerge after discovery.” Dkt. No. 96 at 8 15. But those facts are not in the complaint as it currently stands, and so these claims are 9 || dismissed with leave to amend. 10 The claim for breach of the covenant of good faith and fair dealing (Count 9) and negligent 11 infliction of emotional distress claim (Count 10) may proceed against defendants Crowe and 12 || Lyonette, but are dismissed for the other defendants, because they were not party to the contract, 5 13 || as discussed.? 14 Wescott may file a third amended complaint by February 18, 2021. This will likely be the 3 15 || last opportunity to amend. Failure to meet this deadline will result in dismissal with prejudice 16 || under Federal Rule of Civil Procedure 41(b). Wescott is advised to keep the amended complaint 3 17 short and clear. If defendants move to dismiss, they should file a joint brief to the fullest extent 18 || possible, and avoid duplicative filings. 19 IT IS SO ORDERED. 20 || Dated: January 28, 2022 21 22 73 JAMES ATO. United ffates District Judge 24 25 26 27 28 3 Defendants did not suggest that either of these claims should be dismissed for Crowe and Lyonette, see Dkt. No. 89 at 13-14.