Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-01223/USCOURTS-cand-3_05-cv-01223-6/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:1332 Diversity-Fraud

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United States District Court

For the Northern District of California

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1LalBhatia is the only active defendant remaining in the case. Default was entered against defendants

Allied BostonBank, Inc. and Allied Boston International, Inc.(docket#20)and Marzban Mody (docket #23).

Defendant Jack Grover was voluntarily dismissed without prejudice (docket #37).

United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

BHARI INFORMATION TECHNOLOGY

SYSTEMS PVT., LTD.,

Plaintiff,

 v.

ALLIED BOSTON BANK INC., ALLIED

BOSTON INTERNATIONAL, INC., LAL

BHATIA, JACK GROVER, AND MARZBAN

MODY,

Defendants.

 /

No. C 05-01223 SI

ORDER DENYING IN PART AND

GRANTING IN PART DEFENDANT

BHATIA’S MOTIONS TO DISMISS

On December 2, 2005, this Court heard oralargument on defendant LalBhatia’s motions to dismiss.1

Having carefully considered the arguments of counsel and the papers submitted, the Court hereby DENIES

defendant’s motions to dismissforimproper venue,lack ofsubjectmatterjurisdiction, failure ofplaintiffto plead

fraud, fraudulent misrepresentation and negligent misrepresentation with particularity, failure ofplaintiffto state

a claim upon which relief can be granted under false advertising and unfair business practice, and plaintiff’s

failure to join indispensable parties. The Court GRANTS defendant’s motion to dismiss plaintiff’s claims for

money had and received and breach of contract.

BACKGROUND

This action arises from a dispute between plaintiff Bhari Information Technology (“Bitech”), a private

company with a principal place ofbusinessin Delhi, India, and defendant LalBhatia, a San Francisco resident

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2 Plaintiff claims defendant approached Bitech throughMaheshGandhi, a principalofMillenium Capital

Management Private Ltd., an Indian merchant bank acting as an agent for plaintiff in the financing transaction.

3 The alleged sham entities are Lloyd Morgan Securities, Scotland UK; Socie te Asclepisios

Development, Luxembourg; Hellenic International Trust, Cyprus; Multibase Management Limited, London;

and First Global Inc., Nevada. 

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who is or was the President and ChiefExecutive Officer ofAllied Boston International, Inc. (“ABI”) and Allied

Boston Bank (“ABB”). The complaint centers on failed efforts to secure a multi-million dollar loan; plaintiff

alleges that defendants posed as legitimate bankers who offered multi-million dollar loans, and received

substantial up-front fees, but failed to provide the funds.

Plaintiff Bitechasserts that defendant Bhatia approached Bitech2 and represented that ABI and ABB

specialized in offering private capital funding as an alternative to traditional public funding. Plaintiff negotiated

with defendants and ultimately entered into various loan application agreements, but as the time to disburse the

loan neared, defendants claimed an inability to fulfill the transaction. Plaintiff alleges that defendants then

introduced plaintiff to another lending institution that would provide the funding, but only after receiving

substantialup-front fees. Plaintiff allegesthe other entities, which also failed to fund the loans,were shamentities

created by defendant to perpetrate the fraudulent scheme.3 This pattern occurred three times with at least four

different institutions. Plaintiff alleges it completed due diligence and conditions precedent at all relevant times,

yet never received any funding.

Plaintiff asserts that defendants were unable to act as a banking institutionthroughout the course ofthe

transactions because the California Department ofFinancialInstitutions obtained a temporary restraining order,

and ultimately a permanent injunction, against them. Plaintiff seeks the return of approximately $440,974.00

in application, commitment, utilization and other fees it paid to defendants and to the other allegedly sham

entities.

On March 25, 2005, plaintiff filed suit in this Court, claiming diversity jurisdiction. Plaintiff’s First

Amended Complaint was filed on September 2, 2005, and alleges (1) fraud;(2) fraudulent misrepresentation;

(3) negligent misrepresentation; (4) breach of contract; (5) false advertising; (6) unfair business practices; and

(7) money had and received. Defendant Bhatia now seeks to dismiss the First Amended Complaint pursuant

to several of the Federal Rules of Civil Procedure. Bhatia seeks dismissal under Rule 12(b)(3) for improper

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4The agreements apparently provide that disputes could be resolved in Republic of Palau, Cypress or

in Luxembourg, depending which agreement is chosen. Plaintiff provided copies of the agreements of August

9, 2002 and August 8, 2003. Antonson Decl., Exs. B and C. Plaintiff alleges ABI issued a letter of intent in

November 2000 and a commitment letter on January 26, 2001, and that ABB issued a commitment letter on

July 2, 2001, but these are not provided. Defendant has provided a January 14, 2002, agreement (in full and

in parts), Ex. 1- 5; the February 27, 2002 MOU between plaintiff and LMS, Ex. 6; and the August 8, 2003,

August 9, 2002, and January 14, 2003, agreements as Ex. 7.

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venue; dismissalunder Rule 12(b)(1) for lack of subject matter jurisdiction; dismissal under Rule 12(b)(6)for

failure to state a claim upon which relief can be granted; dismissal under Rule 9(b) for failure to plead the

elements of fraud with particularity; and dismissalunder Rule 12(b)(7) for failure to join indispensable parties.

DISCUSSION

1. Motion to dismiss for improper venue

Federallawgovernsthe enforceabilityofforum-selection clauses in diversityactions.Manetti-Farrow,

Inc. v. Gucci America, Inc., 858 F.2d 509, 513 (9th Cir. 1988). Motions to dismiss based on a forumselection clause are treated as a Rule 12(b)(3) motion to dismiss for improper venue. Arguetta v. Banco

Mexicano, S.A., 87 F.3d 320, 324 (9th Cir. 1996). The pleadings need not be accepted as true and the court

may consider facts outside ofthe pleadings. Murphy v. Schneider Nat’l, Inc., 362 F.3d 1133, 1137 (9th Cir.

2004) (citing Richards v. Lloyd’s of London, 135 F.3d 1289, 1292 (9th Cir. 1998) and Argueta v. Banco

Mexicano , S. A., 87 F.3d 320, 324 (9thCir. 1996). Forum-selection clauses are prima facie valid and should

not be set aside unless the party challenging their enforcement can show that they are unreasonable under the

circumstances. M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972).

The parties disagree regarding which of the many and varied forum selection clauses should apply to

this case. Defendant Bhatia cites four forum selection clauses from four different agreements, two of which are

dated March 14, 2002, one dated August 9, 2002, and the last dated August 8, 2003.4 Plaintiff argues that

the August 9, 2002 Line ofCredit Agreement betweenBitech, ABB and HIT is the operative contract, because

Section 1.04 of that Agreement states that itsupersedes any prior oralor written agreements. Antonson Decl.,

Ex. B. Plaintiff also argues thatsince neither defendant Bhatia nor the corporate defendants are parties to the

August 8, 2003 agreement, they may not take advantage of its provisions.

The Court agrees that the August 9, 2002 Letter of Credit supersedes all prior agreements and that

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it, if any, would provide the forum selection clause for this case. The parties next dispute whether the forum

selection clause in the August 9, 2002, agreement is mandatory (as defendant claims) or permissive (as plaintiff

contends). The forum selection clause in Section 11.07 of the August 9, 2002 Line of Credit Agreement states

as follows: 

Jurisdiction: This agreement shall be deemed executed, governed by, interpreted and enforced in all

respects in accordance withthe laws ofthe [sic] Cyprus, excluding its choice oflaw provisions or those

of any other jurisdiction. Each party to this Agreement irrevocably and unconditionally: (i) agrees to

waives [sic] the right to any suit, action or other legal proceeding arising out of this Agreement other

than as mentioned in item 11.03 herein above [governing arbitration] ; (ii) consents to the jurisdiction

of Cyprus. (iii) All disputes will be settled as outlined in item 11.03 herein above.

Section (ii) ofthis provision simply recitesthat each party “consents to the jurisdictionofCyprus,” but does not

exclude the jurisdictionof any other sovereignty. To be mandatory, a clause must contain language that clearly

designates a forum as the exclusive one. See N. Cal. Dist. Council of Laborers v. Pittsburg-Des Moines

SteelCo., 69 F.3d 1034, 1036-37 (9th Cir.1995). A non-mandatory clause does not preclude suit elsewhere.

See Hunt Wesson Foods, Inc. v. Supreme Oil Co., 817 F.2d 75, 77 (9th Cir. 1987). The Court concludes

that the language ofthe forum selection clause fails to establish Cyprus as the exclusive jurisdiction. The Court

therefore DENIES defendant’s motion to dismiss for improper venue under Rule 12(b)(3).

2. Motion to dismiss due to arbitration clause

This case is governed by the FederalArbitrationAct, 9 U.S.C. § 1 etseq. When evaluating the validity

of an arbitration agreement, federal courts apply ordinary state-law principles that govern the formation of

contracts. Ingle v. Circuit City Stores, Inc., 328 F.3d 1165, 1170 (9th Cir. 2003) (quoting First Options

of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995)). The Court will therefore evaluate the arbitration

agreement under California law. See id. Under California law, when a person with the capacity ofreading and

understanding an instrumentsigns it, he may not, in the absence of fraud, coercion, or excusable neglect, avoid

its terms on the ground he failed to read it before signing it. Bolanos v. Khalatian, 231 Cal.App.3d 1586,

1590 (1991). 

Plaintiff contends that this arbitration clause was obtained by fraudulent means, citing Batchelder v.

Kawamoto, 147 F.3d 915, 919 (9th Cir. 1998) and Three Valleys Mun. Water Dist. v. E.F. Hutton, 925

F.2d 1136, 1140 (9th Cir. 1991). For a party to escape a forum selection clause on the grounds of fraud, it

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must show that the inclusion of that clause in the contract was the product of fraud or coercion. Batchelder,

147 F.3d at 919 (quoting Richards v. Lloyd’s of London, 135 F.3d 1289, 1297 (9th Cir. 1998)) (internal

quotations omitted). A federal court may consider defenses of duress or fraud in the inducement only if the

duress or fraud relates specifically to the arbitration clause itself and not the contract generally. See Bosinger

v. Phillips Plastics Corp., 57 F.Supp.2d 986, 993 (S.D.Cal. 1999) (quoting Three Valleys Mun. Water

Dist., 925 F.2d at 1140). 

Plaintiff contends that the initial Loan Agreement between ABB and Bitech did not contain an

arbitration provision. Rather, the provisions were added in the August 9, 2002 Line of Credit Agreement, by

which time plaintiff had already paid $360,00.00 in up-front fees to defendant ABB and an additional

$3,374.00 to SAD, one of the sham entities. Plaintiff claims that it would not have realized any return on its

fees to defendants if it did not agree to the August 9, 2002 Line of Credit Agreement, and that the inclusion

of the arbitration clause and Cyprus law resulted fromduress on the part of defendants. Plaintiff contends that

defendant acquired leverage over plaintiff as a result of plaintiff’s heavy investment of fees to acquire funding

from defendants.

Plaintiff asserts specifically that its agreement to the arbitration clause was the result of duress and

coercion. The Court findsthat plaintiffhas presented sufficientevidence to demonstrate coercion in the inclusion

of the arbitration clause in the August 9, 2002, agreement, and defendant has presented no evidence to the

contrary. The Court therefore DENIES defendant’s motion to dismissfor lack of subject matter jurisdiction.

3. Motion to dismiss for failure to state a claim

Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if it fails to

state a claim upon which relief can be granted. A motion to dismiss will only be granted if “it appears beyond

doubt that the plaintiff can prove no set of facts in support of its claim which would entitle it to relief.” See

Conley v.Gibson, 355 U.S. 41, 45-46 (1957); Fidelity Financial Corp v. Federal Home Loan Bank of

San Francisco, 792 F.2d 1432, 1435 (9th Cir. 1986); cert. denied, 479 U.S. 1064 (1987). All material

allegations in the complaint will be taken as true and construed in the light most favorable to the plaintiff. See

NL IndustriesInc., v. Kaplan, 792 F.2d 896, 898 (9th Cir. 1986). Although Courts are generally confined

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5 § 17500 states, “[i]t is unlawful for any person . . . with intent directly or indirectly to . . . perform

services, professional or otherwise . . . to induce the public to enter into any obligation relating thereto . . .any

statement, concerning . . . those services, professional or otherwise, . . . which is untrue or misleading.”

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to consideration ofthe allegations in the pleading, when the complaint is accompanied by attached documents,

such documents are deemed part of the complaint and may be considered in evaluating the merits of a Rule

12(b)(6) motion. Durning v. First Boston Corp., 815 F.2d 1265, 1267 (9th Cir. 1987).

A. False advertising

Plaintiff’sfifth cause of action allegesthat defendants engaged in false advertising inviolationof§ 17500

ofthe California Business and Professions Code.5 Plaintiff claims that defendants violated this statute when they

directly or indirectly advertised their ability to provide commercialloans, and induced plaintiffto signthe various

commitment letters, loan agreements and documentary credit agreements, knowing they were incapable of

providing such loans. Defendant Bhatia asserts that plaintiff’sfalse advertising claim is not adequately specific.

However, plaintiff specifically alleged that defendants were under a permanent injunction from engaging in

banking businessin California, FAC 5:4-7; and that defendant Bhatia in his capacity as CEO ofABB and ABI

had knowledge of their inability to act as lending institutions. FAC 5: 8-9. As a matter of pleading, this is

sufficient, and the Court DENIES defendant’s motion to dismiss plaintiff’s claim of false advertising.

B. Money had and received

Plaintiff’sseventh cause of action is for money had and received by defendants forthe use and benefit

of the plaintiff. An action for money had and received aims to recover money paid on a contract whose

consideration has failed. See Bank of Am. Nat’l Trust and Savings Ass’n v. Hayden, 231 F.2d 595, 601

(9th Cir. 1956). 

Defendant Bhatia argues that plaintiff’s cause of action for money had and received is insufficient due

to plaintiff’s failure to allege thatit paid the fees to defendant Bhatia, or that defendant Bhatia failed to perform

any contract between the two parties. The Court agrees. Plaintiff alleges that it paid fees to ABB, ABI and

other “sham” entities, see FAC ¶¶ 39–40, but has not alleged that defendant Bhatia individually received the

funds. The Court therefore GRANTS defendant’s motion to dismiss plaintiff’s claim for money had and

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 Defendant provides a long footnote apparently detailing the elements of § 17200 and asserting why

plaintiff may not recover damages for violation of §17200.The Court notes that plaintiff seeks restitution,

including disgorgement of defendant’s gains, which it would be entitled to under this statute. See Freeman v.

Time, Inc., 68 F.3d 285, 288 (9th Cir. 1995). Furthermore, the issue of plaintiff’s recovery is not before the

Court.

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received. The dismissal is without prejudice to plaintiff amending the complaint to allege that defendant Bhatia

personally received the fees, if plaintiff can truthfully make such an allegation.

C. Unfair business practice

Plaintiff’ssixthcause of action allegesthat defendants have engaged in unlawfuland fraudulent business

acts and practices constituting unfair competition as defined in California Business and Professions Code §

17200 et seq. Section 17200 states that “unfair competition shall mean any unlawful or fraudulent business act

or practice.” The statute is broad and “borrows” violations of other laws and treats these violations, when

committed in the course of business activity, as unlawful practices independently actionable under § 17200 et

seq. See Gregory v. Albertson’s, Inc., 104 Cal. App 4th 845, 851 (2002) (quoting FarmersIns. Exchange

v. Superior Court, 2 Cal 4th 377, 383 (1992)) (internal quotations omitted).

Defendant Bhatia contends the claim fails forfailure to allege the elements of a cause of action for unfair

business practices. Plaintiff’s FAC, however, alleges that defendants committed an unlawful act in violation of

California Finance Code §§ 3391, 3392, 3390, 1725, and 1750. FAC ¶ 73. Moreover, a violation of §

17500 would constitute a violation of § 17200. Accordingly, the Court concludes that plaintiff has alleged a

claim under § 17200 and DENIES defendant’s motion to dismiss plaintiff’s claim under § 17200.6

D. Breach of contract

Plaintiff’s fourth cause of action alleges breach of contract. The elements of breach of contract claim

are (1) the existence of a valid contract between the parties; (2) plaintiff’s performance; (3) defendant’s

unjustified or unexcused failure to perform; and (4) damages to plaintiff caused by the breach. See Careau

& Co. v. Sec. Pac. Business Credit,Inc., 222 Cal. App.3d 1371, 1388 (1990). The existence ofa contract

between the litigating parties is a necessary element to an action based on contract. See Roth v. Malson, 67

Cal. App. 4th 552, 557 (1998). 

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7 Ex. 4 to defendant’s motion to dismissis a copyofthe January 14, 2002 Commitment Letter between

ABB and plaintiff. The signature page has Mr. Arif Rahman’s signature as the authorized signatory ofplaintiff

and ABB’s authorized signatory is identified as Mr. Lal Bhatia, however, there is no signature. 

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Defendant Bhatia urges that plaintiff’s breach of contract claim must be dismissed because the FAC

allegesonly contracts between plaintiff, on the one hand, and the various corporate defendants orshamentities,

on the other; it does not allege the formation of a valid contract between plaintiff and defendant Bhatia as an

individual. 7 Specifically, defendant alleges plaintiff has failed to set forth any material facts establishing

defendant Bhatia as the alter ego of the corporate defendants. Plaintiff acknowledges that it did not argue the

doctrine of alter ego. Directors and officers are not personally liable on contracts signed by them for and on

behalf of the corporation unlessthey purport to bind themselvesindividually. United States Liab . Ins. Co. v.

Haidinger-Hayes,Inc., 1 Cal.3d 586, 595 (1990). The Court therefore GRANTS defendant Bhatia’s motion

to dismiss plaintiff’s breach of contract claim. This dismissal is without prejudice to plaintiff amending the

complaint to allege alter ego or other vicarious liability on the part of defendant Bhatia, if plaintiff can truthfully

make such an allegation after discovery progresses.

4. Motion to dismiss for failure to aver fraud with particularity

Federal Rule of Civil Procedure 9(b) requires that, “[i]n all averments of fraud or mistake, the

circumstances constituting fraud or mistake shall be stated with particularity. Malice, intent, knowledge, and

other condition of mind of a person may be averred generally.” Rule 9(b) requires that the complaint identify

the circumstances constituting the alleged fraud “so that the defendant may prepare an adequate answer.” In

re Worlds of Wonder Sec. Litig., 721 F.Supp 1140, 1142 (N.D. Cal 1989) (quoting Walling v. Beverly

Enterprises, 476 F.2d 393, 397 (9th Cir. 1973)). 

A. Fraud

Plaintiff allegesthat the acts, omissions and misrepresentations of defendant constitute both actual and

constructive fraud.

i. Specificity of pleading

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Under California law, the indispensable elements of a fraud claim include a false representation,

knowledge of its falsity, intent to defraud, justifiable reliance, and damages. See Vess v. Ciba-Geigy Corp.,

USA, 317 F.3d 1097, 1105 (9th Cir. 2003) (quoting Moore v. Brewster, 96 F.3d 1240, 1245 (9th Cir.

1996)). Defendant argues that plaintiff’s FAC is not sufficiently certain as it fails to identify the parties against

whom the causes of action are directed. 

The Court disagrees. As plaintiff points out, although the FAC refers to LalBhatia, Marzban Mody,

Jack Grover, ABB and ABI collectively as “Defendants,” FAC 1:24, it identifies relevant defendants when

necessary in describing specific events. The Court finds thatthe FAC identifiesthe circumstances constituting

fraud sufficiently that defendant may prepare an adequate answer to the allegations. Specifically, plaintiff claims

that defendant was the CEO ofABB at the time ofthe loan agreement of July 2, 2001, pursuant to whichABB

agreed to loan plaintiff $7.5 million. Plaintiff further elaborates the fraudulent activity by asserting that the

California Department of Financial Institutions had obtained a permanent injunction against ABB, which

prohibited it from operating a representative office, agency or branch and from using the word “bank” in its

name, as of June 26, 2001. FAC 4:26-27, 5:1-11. Thus, defendant would have been aware that ABB was

unable to comply with the loan agreement. As a matter of pleading, this is adequate. 

ii. Material misrepresentation

Defendant also argues that plaintiff’sfraud claims must fail because plaintiff has not alleged a material

misrepresentation, relying by analogy on the “bespeaks caution” doctrine applicable to federalsecuritiesfraud

claims under the Private Securities Litigation Reform Act. The “bespeaks caution” doctrine provides a

mechanismbywhicha court as a matter oflaw may determine thatdefendant’sforward-looking representations

contain enoughcautionary language or risk disclosure to protect the defendant against claims ofsecuritiesfraud.

See Provenz v. Miller, 102 F.3d 1478, 1487 (9th Cir. 1996) (quoting Donald C. Langevoort, Disclosures

that “Bespeak Caution”, 49 Bus. Law. 481, 482-83 (1994)). This doctrine provides that statements must be

analyzed “in context,” must “be precise,” and must “directly address the future defendant’s projections.” See

id. at 1493. Defendant provides language from the various agreements which, he contends, demonstrates such

cautionary language.

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However, this argument fails for at least three reasons. In the first place, defendant supplies no

authority applying the “bespeaks caution” doctrine to common law fraud claims. Secondly, the Court does not

find the language quoted by defendant particular and precise enough to meet the doctrine’s standard. Rather,

these statements appear to be “blanketwarnings”which are inappropriate to immunize to defendants. See id.

Finally, the doctrine inapplicable in the present case because plaintiff’s claim is for intentional fraud and

cautionary language cannot protect from fraud. 

The Court DENIES defendant’s motion to dismiss plaintiff’s claims of fraud.

B. Justifiable reliance – negligent and fraudulent misrepresentation

Plaintiff alleges defendants represented themselves as lenders of commercialloans, though defendants

did not have reasonable grounds for believing themselves capable of facilitating such transactions. Plaintiff

further alleges the representations were made with the intent to induce plaintiff to detrimentally rely on them.

Plaintiff concludes that defendants’ conduct amounted to either negligent or fraudulent misrepresentation. 

DefendantBhatia arguesthat plaintiff’s claims ofnegligent and fraudulent misrepresentation failbecause

plaintiff will not be able to demonstrate that it justifiably relied on representations by defendant. However, the

Court concludes that plaintiff has alleged justifiable reliance with satisfactory particularity at the pleading stage.

Whether plaintiff will be able to prove these allegations to the satisfaction of the trier of fact is a different

question, but the allegations made are sufficient for purposes of the present motion to dismiss. The Court

therefore DENIES defendant’s motion to dismiss plaintiff’s claims for fraudulent and negligent

misrepresentation.

5. Motion to dismiss for failure to join indispensable parties

Defendant moves under FederalRule ofCivil Procedure 12(b)(7)to dismissfor “failure to join a party

under Rule 19.” A two part test applies to motions to dismiss for failure to join necessary and indispensable

parties. See Washington v. Daley, 173 F.3d 1158, 1167 (9th Cir. 1999). First, the court must decide if the

person not a party is necessary to the suit. If the person is necessary, and if he or she cannot be joined for

jurisdictional reasons, the court must determine if he or she is “‘indispensable’ so that in ‘equity and good

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conscience’ the suit should be dismissed. The inquiry is a practical one and fact specific, and is designed to

avoid the harsh results of rigid application. The moving party has the burden of persuasion in arguing for

dismissal.” See Artichoke Joe’s v. Norton, 216 F.Supp.2d 1084, 1118 (E.D. Cal. 2002) (quoting Makah

Indian Tribe v. Verity, 910 F.2d 555, 558 (9th Cir. 1990)). 

The Court must examine several factors when determining to dismiss a claim forlack ofjoinder:(1) to

what extent a judgment rendered in the person’s absence might be prejudicial to those persons already parties,

(2) the extent to which, by protective provisions in the judgment, such as shaping of relief, the prejudice may

be lessened or avoided,(3)whether a judgment rendered in the person’s absence will be adequate, (4) whether

the plaintiff will have an adequate remedy if the action is dismissed for lack of joinder. Schnabel v. Lui, 302

F.3d 1023, 1029 (9th Cir. 2002).

Defendant moves to dismiss plaintiff’s FAC for failure to join Mahesh Gandhi, LMS, SAD, HIT, and

MML as defendants. Defendant Bhatia argues that they are indispensable because they are the parties plaintiff

actually contracted with, while defendant Bhatia was not a party to any contract.

Plaintiff contends that the absent entities and individuals are not necessary to the suit. To qualify as

“necessary,” the person not a party must have a legally protected interest in the suit, but the interest must be

more than financial. See Makah Indian Tribe v. Verity, 910 F.2d at 558 (citing N. Alaska Envtl. Ctr. v.

Hodel, 803 F.2d 466, 468 (9th Cir. 1986)). Plaintiff asserts this is a suit merely for money damages

recoverable from defendant, and the Court agrees.

The Court therefore DENIES defendant’s motion to dismissthe FAC forfailure to join indispensable

parties. 

CONCLUSION

For the foregoing reasons and for good cause shown, the Court hereby GRANTS defendant’s motion

to dismiss plaintiff’s claim for money had and received and breach of contract; and DENIES defendant’s

remaining motions to dismiss. [Docket # 32].

IT IS SO ORDERED.

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Dated: December 19, 2005

 

SUSAN ILLSTON

United States District Judge

Case 3:05-cv-01223-SI Document 47 Filed 12/20/05 Page 12 of 12