Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_11-cv-03102/USCOURTS-caed-2_11-cv-03102-10/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1109 Breach of Fiduciary Duties

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UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF CALIFORNIA 

VIRGINIA C. MOON, on her own 

behalf and on behalf of the 

Peters Rush Habib & McKenna 

401(k) Profit Sharing Plan, 

Plaintiff, 

v. 

DAVID H. RUSH, MARK A. HABIB, 

and JAMES P. MCKENNA, 

Defendants. 

2:11-cv-03102-GEB-CKD 

ORDER DENYING MOTION TO 

DISMISS*

DAVID H. RUSH, 

Counterclaimant, 

v. 

VIRGINIA C. MOON, 

Counterdefendant. 

Counterdefendant Moon moves under Federal Rule of Civil 

Procedure 12(b)(6) for dismissal of Counterclaimant Rush’s breach 

 

*

 This matter is deemed suitable for decision without oral argument. E.D. 

Cal. R. 230(g). 

Case 2:11-cv-03102-GEB-CKD Document 78 Filed 11/01/13 Page 1 of 3
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of contract counterclaim, arguing it is barred by the two-year 

statute of limitations prescribed in Section 339(1) of the 

California Code of Civil Procedure. (See Counterdef.’s Mot. to 

Dismiss (“Mot. to Dismiss”) 3:14-15, 3:27-28, ECF No. 72.) Rush 

rejoins, inter alia, that this claim is not barred by the statute 

of limitations because he waived Moon’s breaches until 2009 

(Counterclaimant’s Opp. to Mot. to Dismiss (“Counterclaimant’s 

Opp.”) 5:9-11, ECF No. 75) which was within two years of the 

parties’ October 28, 2010 statute of limitations tolling 

agreement (Counterclaimant’s Opp. 9:18-19; Compl. ¶ 49, ECF No. 

2.) 

Under the waiver of breach doctrine on which Rush 

relies, “when there are ongoing contractual obligations the 

plaintiff may elect to rely on the contract despite a breach, and 

the statute of limitations does not begin to run until the 

plaintiff has elected to treat the breach as terminating the 

contract.” Romano v. Rockwell Internat., Inc., 14 Cal. 4th 479, 

489 (1996) (citing 1 Witkin, Summary of Cal. Law, (9th ed. 1987), 

Contracts, §§ 800-801, pp. 723-724.) Further, the California 

Supreme Court states in Romano: “In the context of successive 

breaches of a continuing contractual obligation, . . . the 

injured party could wait until the time arrived for a complete 

performance by the other party and then bring an action for 

damages for such breaches.” Romano, 14 Cal. 4th at 489-90 

(quoting Lambert v. Commonwealth Land Title Ins. Co., 53 Cal. 3d 

1072, 1078 (1991)) (internal quotation marks omitted). 

Rush alleges the parties entered into a contractual 

agreement to act as co-owners of a property and to split the 

Case 2:11-cv-03102-GEB-CKD Document 78 Filed 11/01/13 Page 2 of 3
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re

ag

ta

Co

co

wh

of

on

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Mo

Ca

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ental pr

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f the ren

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urther, t

oon v. R

al. Aug.

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ed “an 

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For the 

to the e

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ed and wi

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that p

to Rush h

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ongoing 

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roperty 

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 42.) R

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ly alleg

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 the dis

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43.) 

he has 

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filed on 

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 ruling,

ecificall

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, that r

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property

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his share

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s denied.

6, 2013,

*9 (E.D.

ruling is

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e

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,

f

e

.

,

.

s

Case 2:11-cv-03102-GEB-CKD Document 78 Filed 11/01/13 Page 3 of 3