Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_15-cv-01698/USCOURTS-casd-3_15-cv-01698-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 18:1964 Civil Remedies: Racketeering (RICO) Act

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

RYAN MOUSSAVI,

Plaintiff,

CASE NO. 15cv1698-LAB (KSC)

vs. ORDER OF DISMISSAL

SHAHNAZ ZAHEDY; MARYAN FARSI

JOHNY; and DOES 1-100,

Defendants.

Under the Federal Rules of Civil Procedure, an indispensable party must be joined

to an action, claims grounded in fraud must be pled with particularity, and all claims must be

pled with plausibility. Ryan Moussavi didn’t meet any of those requirements. He failed to add

his brother to the action, didn’t provide the particulars of loans obtained through fraud, and

made implausible claims—for example, he maintains that his stepmom engaged in

racketeering when she provided marijuana to her husband who was battling brain cancer.

The Court dismisses the action.

Background

Five years ago, Bijan Moussavi deeded his sons Ryan and Bryndon Moussavi “equal

shares” of two rental properties in Kansas where the brothers live. A few months later, Mr. 1

Moussavi developed brain cancer. Ryan’s stepmom, Shahnaz Zahedy, cared for Mr.

Defendants dispute this claim with a declaration explaining that the deeds were 1

never delivered and the properties were intended to pass to Ryan and Bryndon after their

dad died. Zahedy Declaration, Dkt. 14-2. 

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Moussavi in his Carlsbad home for the next two years. Ryan says Zahedy’s sister, Maryan

Farsi Johny, also moved into the house and helped care for Mr. Moussavi.

The remainder of the Complaint tells a confusing, inchoate story. Ryan maintains that

his stepmom and her sister, “in addition to providing medications” to Mr. Moussavi, began

giving him “marijuana to keep Decedent heavily incapacitated at all times.”The Defendants

used the marijuana to persuade Mr. Moussavi “to assist them in their unlawful intentions to

take and wrongfully withhold money from Plaintiff.” Apparently, Ryan is claiming that his

stepmom and her sister would provide Mr. Moussavi marijuana, and once the cannabis

kicked-in, they would convince Mr. Moussavi to call Ryan to request money for medical care.

Ryan says these requests resulted in two “loans.”2

1. The $80,000 Loan

Ryan says he loaned the Defendants $80,000 “to help with Decedent’s costs.”

Defendants paid back $50,000, but still owe him $30,000. He maintains that a week after his

dad died, he wrote to his stepmom demanding repayment, and she “agreed and affirmed her

duty to pay Plaintiff back” “upon the sale of real estate.” Ryan doesn’t offer any other details

about this agreement.

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2. The $160,000 Loan

Ryan also says the Defendants told him that his dad “needed money to pay medical

bills.” Ryan “quickly agreed to loan Defendants the rental income” from the two Kansas

properties. Ryan says it was his “understanding that all Rental Income loaned to Defendants

would be paid back” after his dad died. Ryan doesn’t offer any other details about this

agreement either.

Instead, Ryan says the Defendants didn’t use “the loaned money as agreed” because

they spent it on “controlled substances.” He also maintains that the Defendants collected

“monthly paychecks” from the renters “even after Mr. Moussavi” died, despite Ryan “asking

them to desist and to return the rental income.” In total, Ryan says he’s owed $166,150.4

 Second Amended Complaint, Dkt. 13 at 3-5.

2

Id. at 5–6.

3

Id. 4

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3. The $2 million Personal Property

Finally, Ryan says that after his dad died, he “became entitled to certain personal

items.” Ryan demands “recovery of those certain personal items of Decedent, including but

not limited to, the Iranian birth certificate or $2,000,000.” Ryan doesn’t say what the personal

items are, why he’s entitled to the items, or how he estimates the items’ worth at $2 million.5

* * *

Ryan commenced this action about two years ago. He’s on his third complaint. And

the Court ordered him to show cause for failure to prosecute after he let the case sit dormant

for about nine months. Despite all that time, he failed to join his brother Bryndon to the

action. Both parties agree Bryndon is an indispensable party since he allegedly has a right

to half of the rental income. The Defendants moved to dismiss the Complaint.

Legal Standard

To survive a motion to dismiss, plaintiffs must “nudge[] their claims across the line

from conceivable to plausible.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). But

here “the complaint as a whole must satisfy the heightened pleading requirements of Rule

9(b)” since it alleges a “unified fraudulent course of conduct.” Vess v. Ciba-Geigy Corp. USA,

317 F.3d 1097, 1106 (9th Cir. 2003).

Analysis

The Court dismisses the Complaint on three independent bases. First, for failure to

plead claims grounded in fraud with particularity under Rule 9(b). Second, for failure to state

a claim upon which relief can be granted under Rule 12(b)(6). Third, for failure to join an

indispensable party under Rule12(b)(7).

A. Particularity

“When an entire complaint . . . is grounded in fraud and its allegations fail to satisfy

the heightened pleading requirements of Rule 9(b), a district court may dismiss the

complaint.” Vess, 317 F.3d at 1107 (9th Cir. 2003). Ryan alleges that his stepmom and her

sister engaged in a “fraudulent scheme” by claiming they needed money to cover Mr.

Moussavi’s medical bills, but instead used the money to buy marijuana. Ryan also maintains

Id. at 7, 12. 5

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that his stepmom lied to the renters in Kansas by claiming she was the “rightful beneficiary”

of the rental income.

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Allegations “of fraud must be accompanied by the ‘who, what, when, where, and how’

of the misconduct charged.” Id. at 1106. Ryan doesn’t offer these details. The Complaint

doesn't explain who, specifically, was a party to the loan agreements; what the terms were;

or when, where, and how the agreements were made. The Complaint also lacks any details

about the alleged misrepresentations that the Defendants made to Ryan and the

renters—the Court has no idea who said what and when. 

Instead, Ryan argues that there isn’t any “doubt that the facts as pleaded are

peculiarly within the knowledge of Defendants.” The Court disagrees. If anyone knows who

Ryan spoke to, what Ryan spoke to them about, and when Ryan spoke to them, it’s Ryan.

The Court dismisses the complaint for failing to meet the heightened standard of

particularity. Fed. R. Civ. P. 9(b).7

B. Plausibility

The Court also dismisses all of the causes of action for failure to state a claim that

satisfies the plausibility standard. Fed. R. Civ. P. 12(b)(6); Twombly, 550 U.S. at 570.

1. RICO 

The Racketeer Influenced and Corrupt Organizations Act was enacted to combat “the

infiltration of legitimate businesses by organized crime.” United States v. Turkette, 452 U.S.

576, 593 (1981). The Act makes it “unlawful for any person employed by or associated with

any enterprise engaged in, or the activities of which affect, interstate or foreign commerce,

to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs

through a pattern of racketeering activity.” 18 U.S.C. § 1962(c). 

Racketeering activity covers a wide range of conduct, but Ryan draws on the statute’s

ban on “dealing in a controlled substance.” § 1961(1). Ryan argues that his stepmom, her

sister, and unknown Does constituted an enterprise engaged in a pattern of racketeering

because they supplied marijuana to his dad. This isn’t a plausible RICO claim. It’s a financial

 Dkt.13 at 9. 6

 Opposition, Dkt. 18 at 12.

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dispute between a son and his stepmom. But Ryan’s claim suffers from specific pleading

problems as well. 

First, the Complaint doesn’t plausibly allege that Ryan’s stepmom and her sister were

employed by or associated with a separate enterprise. See Rae v. Union Bank, 725 F.2d

478, 480 (9th Cir. 1984). An enterprise is “a group of persons associated together for a

common purpose of engaging in a course of conduct.” Ryan must allege the existence “of

an ongoing organization” where “various associates function as a continuing unit.” Turkette,

452 U.S. at 583 (1981). Pleading unknown Doe defendants as the missing members of the

enterprise doesn’t do the trick here: it’s not plausible that a wife providing her dying husband

with marijuana is engaged with unknown Doe’s in an “ongoing organization” that functions

“as a continuing unit” for the “common purpose” of taking Ryan’s money.

Second, “[a] RICO plaintiff must show that a defendant's predicate acts were the

‘but-for’ and proximate cause of the alleged injury.” Ahn v. Hanil Dev., Inc., 471 F. App'x 615,

617 (9th Cir. 2012). Ryan hasn’t plausibly pled that the “racketeering activity” caused

damage to his “business”—that is, his stepmom’s “distribution” of drugs to his dad is too

attenuated with her current failure to return rental income to Ryan. See Hemi Grp., LLC v.

City of N.Y., N.Y., 559 U.S. 1, 9 (2010) (“A link that is too remote” “is insufficient”).

Third, it’s implausible that providing marijuana to a spouse affects interstate

commerce. Ryan offers a single conclusory statement to support this element. Defendants

challenged Ryan to address this problem in his opposition; he didn’t. See Abogados v.

AT&T, Inc., 223 F.3d 932, 937 (9th Cir. 2000) (waiver for failing to address issue).

2. Breach of Contract

To state a claim for breach of contract, Ryan must first allege the formation of a

contract: (i) that the parties agreed to give each other something of value; (ii) the contract

terms were clear enough that the parties understood what each was required to do; and (iii)

that the parties agreed to the terms. See CACI 302. “Facts alleging a breach, like all

essential elements of a breach of contract cause of action, must be pleaded with specificity.”

Levy v. State Farm Mut. Auto. Ins. Co., 150 Cal. App. 4th 1, 5 (2007). 

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Ryan hasn’t plausibly alleged the formation and breach of a contract. Ryan says he

loaned the defendants $80,000 but he’s still owed $30,000. The only factual support is his

allegation that his stepmom said she would “repay him” after selling some property but she

didn’t. Ryan doesn't offer any other details about when the contract was formed or what the

terms were. Ryan doesn’t cite any legal authority either. Instead, he asserts that

“Defendant’s arguments about the loan and its terms being vague are without merit as

Defendants clearly understand what is alleged to still be owed to Plaintiff.”8

That may be. But Ryan’s asking the Court to take his word for it that a contract was

formed. At this stage, the Court must assume his version of the facts as true, but it doesn’t

need to accept legal conclusions. Ryan labels this a “loan,” but he hasn’t pled facts that allow

the Court to infer that his stepmom and her sister entered and breached a legally

enforceable agreement. It’s conceivable that Ryan has a breach of contract claim, but he

hasn’t offered enough specific facts for the Court to find the claim is plausible.

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3. Conversion

To state a claim for conversion, Ryan must allege that: (i) he had a right to possess

an item of personal property; (ii)the Defendants intentionally and substantially interfered with

Ryan’s property by taking possession of it or preventing him from having access to it; (iii)

Ryan didn’t consent; and (iv) Defendants’ conduct was a substantial factor in causing Ryan’s

harm. See CACI 2100. 

Ryan claims that the Defendants have converted (a) the money owed for both loans

and (b) “certain personal items” including his dad’s “Iranian birth certificate.” Ryan hasn’t

plausibly alleged conversion for either of these claims.

(a) Loans

Ryan’s claims for unpaid “loans” sound in contract, not tort. Farmers Ins. Exch. v.

Zerin, 53 Cal. App. 4th 445, 452 (1997) (“a mere contractual right of payment, without more,

will not suffice” to state a conversion claim); Kim v. Westmoore Partners, Inc., 201 Cal. App.

4th 267, 284 (2011) (dismissing conversion claim “because the simple failure to pay money

 Dkt. 18 at 4. 8

Even if he had stated a claim, $30,000 doesn’t meet the amount in controversy 9

necessary for diversity jurisdiction. 

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owed does not constitute conversion.”) But there are more specific pleading problems with

Ryan's conversion claims.

First, an “action for conversion of money can be stated only where a defendant

interferes with the plaintiff's possessory interest in a specific, identifiable sum, such as when

a trustee or agent misappropriates the money entrusted to him.” Kim, 201 Cal. App. 4th at

284 (emphasis omitted). Ryan says that on an unspecified number of occasions, the

Defendants asked for an unspecified amount of money, and his dad “would, unknowingly,

affirm the false requests for more money.” Then, at some unspecified time, Ryan discovered

the money was being spent on marijuana, which violated some unspecified term of the

agreement, and he demanded that his stepmom return all of the loaned money. Those

allegations fail to plausibly allege that Ryan entrusted a specific amount of money to his

stepmom to act as his trustee or agent. C.f. Haigler v. Donnelly, 18 Cal. 2d 674, 681 (1941)

(“A broker or agent is ordinarily liable for converting the funds of his principal when he

refuses to account for them.”) (emphasis added). 

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Second, Zahedy says that her husband “obtained a prescription for marijuana

because his doctor thought correctly that it would slow the progress of his brain cancer.”

Ryan doesn’t dispute this claim. Therefore, even if Ryan entrusted his stepmom with money

for the specific purpose of paying for his dad’s medical needs, Ryan hasn’t plausibly

explained why spending that money on a medical prescription amounts to misappropriation.

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Third, the “law is well settled that there can be no conversion where an owner either

expressly or impliedly assents to or ratifies the taking, use or disposition of his property.”

Farrington v. A. Teichert & Son, 59 Cal. App. 2d 468, 474 (1943). Ryan admits that he

consented to the Defendants borrowing money to pay for his dad’s medical expenses. But

at some point, he no longer consented. Ryan doesn’t say when that occurred. Ryan hasn’t 

alleged enough facts for the Court to find that the Defendants “substantially interfered” with

 Dkt. 13 at 4. 10

 Motion to Dismiss, Dkt. 14-1 at 3; Dkt. 14-2. 11

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his right to rental income from January 2013 through January 2015. Ryan hasn’t stated a

claim for conversion of the loans.12

(b) Personal Property

Under the probate exception, the court is barred “from endeavoring to dispose of

property that is in the custody of a state probate court” and “reserves to state probate courts

the probate or annulment of a will and the administration of a decedent's estate.” Marshall

v. Marshall, 547 U.S. 293, 311–12 (2006); Williams v. Madera Superior Court, 2016 WL

6892539, at *1 (9th Cir. Nov. 23, 2016) (affirming dismissal because “federal courts lack

jurisdiction over probate matters”). The claim for “certain personal property” isn’t good

enough. The Court has no basis to conclude that Ryan has a right to unspecified property. 

The Defendants argue that all of the personal items passed to Ryan’s stepmom under

the trust and estate planning documents. Defendants say Ryan’s dispute is with his dad’s

will—he can challenge it in California probate court, but a federal forum isn’t appropriate. The

Court agrees. Ryan had an opportunity to identify the property and to explain why he’s

entitled to other personal effects that belonged to his dad but that don’t implicate probate

issues. He didn’t. See Abogados, 223 F.3d at 937 (9th Cir. 2000).

4. Interference with prospective economic relationship

To state a claim for intentional or negligent interference with a prospective economic

relationship, Ryan must allege that (i) he was in an economic relationship with the rental

property owners that probably would have resulted in economic benefit to him; (ii) that the

Defendants knew about the relationship; (iii) Defendants engaged in some wrongful conduct

intended to disrupt the relationship (intentional), or, failed to act with reasonable care

(negligence); (iv) Defendants disrupted the relationship; and (v) Defendants conduct was a

substantial factor in causing harm. See CACI 2202, 2204.

Ryan says the Defendants “collected monthly paychecks, either by mail or money 12

wire, even after Mr. Moussavi’s father died and despite Mr. Moussavi asking them to desist

and to return the rental income.” Ryan’s dad died in mid-January 2015 and Ryan says he

wants rental income through February 2015. At best, those allegations suggest that the

Defendants interfered with his right to collect one month’s rent after his dad died. (A sum well

short of the jurisdictional amount in controversy.)

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First, Ryan only makes conclusory allegations about the economic relationship. He

doesn’t provide details about the initial relationship with the renters, how it changed to allow

his stepmom to collect rent, or the status of the relationship after Ryan's dad died. Instead,

he offers one sentence: “Plaintiff and the tenants of the Rental Properties were in an

economic relationship.” Ryan hasn’t given the Court enough information to find a plausible

claim of interference with a prospective economic relationship.13

Second, Ryan hasn’t plausibly alleged disruption of the relationship for many of the

same reasons he failed to allege interference for the conversion claim. He admits that he

“quickly agreed to loan Defendants the rental income from the Rental properties” but it “was

his understanding that all Rental Income loaned to Defendants would be paid back after

Decedent deceased.” He can’t claim the Defendants disrupted the relationship when he

agreed to let them interfere in that relationship by collecting the rent for some unspecified

amount of time.14

C. Indispensable Party

“Where, as here, an indispensable party is not before the court, dismissal must

follow.” Franz v. E. Columbia Basin Irr. Dist., 383 F.2d 391, 392 (9th Cir. 1967). Everyone

agrees that Bryndon Moussavi is an indispensable party since he allegedly is entitled to half

of the rental income. Since Bryndon wasn't joined as a party, dismissal must follow. Fed. R.

Civ. P. 12(b)(7). The Court declines to address Ryan's motion to add Bryndon to the action:

since the Court dismisses the Complaint under Rules 9 and 12 without leave to amend, that

request is moot.

Conclusion

The Court “may exercise its discretion to deny leave to amend due to undue delay”

“repeated failure to cure deficiencies by amendments previously allowed” as well as “undue

prejudice to the opposing party.” Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 893

(9th Cir. 2010) (quotations omitted). Ryan Moussavi filed this Complaint almost two years

 Dkt. 13 at 8, 9. 13

Ryan says the Defendants continued to act as “rightful owner and collected monthly 14

paychecks, either by mail or money wire” even after his “father died.” But that claim fails for

the same reason discussed at n.12. Dkt. 18 at 5.

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ago. He’s had three opportunities to amend his pleadings. The Court has issued two orders

to show cause why his Complaint shouldn’t be dismissed. Ryan let the case sit dormant for

nine months. And the Defendants say he has yet to even serve the Complaint on them.

Given this amount of time, there’s no excuse for failing to plead his claims with

particularity or failing to join his brother to the suit. Worse, Ryan didn't even respond to the

Defendants' argument that the Court should deny leave to file a fourth complaint. The action

is dismissed without leave to amend, but without prejudice to Ryan and Bryndon refiling their

state-law claims in a state forum.

IT IS SO ORDERED.

DATED: May 10, 2017

HONORABLE LARRY ALAN BURNS

United States District Judge

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