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Gazian v. Wells Fargo Bank NA

United States District Court, D. Arizona

February 18, 2014

Ken Gazian, et al., Plaintiffs,
Wells Fargo Bank NA, et al., Defendants.


DAVID G. CAMPBELL, District Judge.

Plaintiffs Ken Gazian, Pierre Investments, Inc., and Aragadz Foods, Inc. d/b/a Devanche Jewelers have filed a motion for leave to file a second amended complaint. Doc. 59. Defendants Hubert Kelly and Kelly and Kelly, P.C. (collectively the "Kelly Defendants") have filed a motion to dismiss Defendant Wells Fargo Bank NA's cross-claim against them or, in the alternative, to bifurcate. Doc. 60. The motions are fully briefed. For the reasons that follow, the Court will deny the motion for leave to amend and deny the motion to dismiss or bifurcate.[1]

I. Background.

Plaintiffs filed this action in Texas state court in October 2012, and it was removed to the United States District Court for the Northern District of Texas on October 26, 2012. Doc. 1. On June 28, 2013, Judge O'Connor ordered that the case be transferred to this Court. Doc. 39. Plaintiffs filed their First Amended Complaint ("FAC") on October 28, 2013, asserting a number of claims against the Kelly Defendants and Wells Fargo arising out of an allegedly "fraudulent scheme orchestrated by the Kelly Defendants." Doc. 51, ¶ 9. Plaintiffs allege that they paid $80, 000 to the Kelly Defendants for a transaction that the Kelly Defendants asserted was worth more than $45, 000, 000 and "would yield a return of $280, 000" for Plaintiffs. Id., ¶ 10. Plaintiffs allege that Wells Fargo "assured Plaintiffs on multiple occasions" that the transaction was valid, " and confirmed that the Kelly Defendants had an account at Wells Fargo with "funds in excess of $280, 000." Id., ¶¶ 11, 14. Plaintiffs claim that they entered into an "Irrevocable Commitment" with the Kelly Defendants and Wells Fargo that set forth the terms discussed above. Id., ¶ 12.

Plaintiffs assert that they were convinced by the Kelly Defendants in October 2011 to reinvest the $280, 000 promised by the Irrevocable Commitment - rather than withdrawing it as scheduled - to "fund a $5, 000, 000 loan to purchase and renovate" an office tower in Dallas. Id., ¶ 16. Plaintiffs also agreed to pay an additional $50, 000 to fund the transaction. Id. Plaintiffs assert that on November 29, 2011, when they attempted to transfer the funds guaranteed by the Irrevocable Commitment to the Kelly Defendants, they "were informed by Wells Fargo that the accounts had been emptied and that Wells Fargo would not pay any amount to Plaintiffs pursuant to the Irrevocable Commitment." Id., ¶ 21.

The day after Plaintiffs' FAC was filed, the Kelly Defendants filed a notice of settlement. Doc. 53. Wells Fargo answered Plaintiffs' FAC on November 15, 2013, and asserted a cross-claim for indemnity against the Kelly Defendants. Doc. 56. The Court dismissed Plaintiffs' complaint as to the Kelly Defendants on November 26, 2013. Doc. 58. Plaintiffs' motion for leave to amend and the Kelly Defendants' motion to dismiss or bifurcate followed on December 6, 2013. Docs. 59, 60.

II. Leave to Amend.

The Court's case management order entered on August 29, 2013, established a deadline for amending pleadings of October 28, 2013. Doc. 50 at 1. Plaintiffs' motion was filed on December 6, 2013, well after the deadline. See Doc. 59. Plaintiffs' motion, in effect, asks the Court to extend the deadline for amending pleadings.

A schedule established under Rule 16 of the Federal Rules of Civil Procedure may be extended only upon a showing of "good cause." Fed.R.Civ.P. 16(b)(4). Rule 16's good cause standard primarily considers the diligence of the party seeking the amendment. Johnson v. Mammoth Recreation, Inc., 975 F.2d 604, 609 (9th Cir. 1992). "The district court may modify the pretrial schedule if it cannot reasonably be met despite the diligence of the party seeking the extension.'" Id. (quoting Fed.R.Civ.P. 16 advisory committee notes (1983 amendment)).

Plaintiffs' motion does not address the good cause requirement, much less show good cause for extending the amendment deadline. The Court will therefore deny the motion.

III. Cross-Claim.

A. Motion to Dismiss.

When analyzing a complaint for failure to state a claim to relief under Rule 12(b)(6), the well-pled factual allegations are taken as true and construed in the light most favorable to the nonmoving party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). Legal conclusions couched as factual allegations are not entitled to the assumption of truth, Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009), and therefore are insufficient to defeat a motion to dismiss for failure to state a claim, In re Cutera Sec. Litig., 610 F.3d 1103, 1108 (9th Cir. 2010). To avoid a Rule 12(b)(6) dismissal, the complaint must plead enough facts to state a claim to relief that is plausible on its face. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). This plausibility standard "is not akin to a probability requirement, ' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 556). "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged - but it has not show[n]' - that the pleader is entitled to relief.'" Id. at 679 (quoting Fed.R.Civ.P. 8(a)(2)).

The Kelly Defendants rely heavily on Plaintiffs' Second Amended Complaint ("SAC") as a basis for their motion to dismiss. They argue that "Plaintiffs have abandoned any allegations that Wells Fargo was a guarantor of the Irrevocable Commitment with their proposed Second Amended Complaint, and no party currently contends that Wells Fargo is obligated to pay any amount as a guarantor." Doc. 60 at 4. They also argue that the SAC effectively eliminates contract claims, leaving only tort claims against Wells Fargo, and that Wells Fargo cannot obtain indemnification for tort claims against the Kelly Defendants because Arizona and Texas have barred such claims. As ...

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