Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-01547/USCOURTS-cand-3_07-cv-01547-6/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Contract Dispute

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

ROBERT M LONG, et al.,

Plaintiffs,

 v.

GINO POSTORIVO, et al.,

Defendants. /

No. C 07-01547 CRB

ORDER

Plaintiffs Robert Long and Bob Long Adrenaline Sports Technology (BLAST) bring

breach of contract and tort claims against defendants Gino Postorivo, National Paintball

Supply (National), PBS Holdings Group, Inc. (PBS), and AJ Holdings, LLC (AJ Holdings). 

Long, a resident of California, is the founder, President and sole shareholder of BLAST, a

leading manufacturer of paintball guns, called “markers.” Postorivo, a resident of New

Jersey, is the founder and former CEO and president of National, a corporation that

distributed paintball markers, including those made by BLAST, and other paintball supplies. 

Plaintiffs allege that PBS is the corporate successor in interest to National. Plaintiffs further

allege that National and/or PBS sold their assets, including BLAST markers, BLAST

intellectual property, and the Oakland Assassins paintball team, to AJ Holdings. 

Now pending before the Court are the following four motions: 1) defendant

Postorivo’s motion to dismiss for lack of personal jurisdiction; 2) defendants’ motion for

judgment on the pleadings on the claims of alter ego liability, civil conspiracy, violation of

Case 3:07-cv-01547-CRB Document 45 Filed 10/11/07 Page 1 of 5
United States District Court

For the Northern District of California

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California Business and Professions Code § 17200, breach of fiduciary duty, and/or punitive

damages; 3) defendants’ motion for dismissal or change of venue; and 4) defendants’ motion

for discretionary change of venue. 

After carefully considering the papers filed by the parties, and having had the benefit

of oral argument on October 5, 2007, the Court rules as set forth below. 

A. Personal Jurisdiction

Plaintiffs have made a prima facie showing that defendant Postorivo has sufficient

contacts with California and that the claims in this suit arise from those contacts. See Data

Disc, Inc. v. Sys. Tech. Assos., 557 F.2d 1280, 1285 (9th Cir. 1977). Postorivo has not met

his burden of showing that personal jurisdiction in California is unreasonable. Postorivo,

through his roles as president and CEO of National, directed National’s business activities in

California. He also sought a business relationship with California-based plaintiffs and

maintained this relationship over the course of several years. In addition, plaintiffs allege

that Postorivo secured intellectual property for BLAST and orally agreed to sponsor the

Oakland Assassins, a paintball team captained by Long. The length and varied dimensions

of the business arrangements evidence the ongoing nature of the relationship between

Postorivo and the plaintiffs, making future consequences of such a relationship foreseeable in

the state of California. Therefore, the Court DENIES Postorivo’s motion to dismiss for lack

of personal jurisdiction.

B. Motion for Judgment on the Pleadings

1. Alter Ego Liability

Plaintiffs allege on information and belief that National was the alter ego of Postorivo. 

They also allege on information and belief that PBS, the corporate successor of National, is

the alter ego of Postorivo. “At the pleading stage, conclusory allegations that a corporate

entity is the alter ego of the defendant are insufficient to survive a motion to dismiss.” RAE

Sys. Inc. v. TSA Sys., Ltd., No. 04-2030, 2005 WL 1513124, at *3 (N.D. Cal. June, 24

2005); accord Hockey v. Medhekar, 30 F. Supp. 2d 1209, 1211 n.1 (N.D. Cal. 1998);

Hokama v. E.F. Hutton & Co., Inc., 566 F. Supp. 636, 647 (C.D. Cal. 1983). 

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United States District Court

For the Northern District of California

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Plaintiffs allege that Postorivo was the founder and former CEO and president of

National. They also allege that Postorivo worked “in close coordination” with National, and

that Postorivo personally assured Long of the success of their business transactions. Lastly,

plaintiffs allege that Postorivo sold the assets of National in order to leave National without

any assets from which BLAST may recover. 

Plaintiffs describe PBS as the corporate successor in interest to National and the

current alter ego of Postorivo but did not allege facts supporting a continuing relationship

between PBS and Postorivo or Postorivo’s involvement with PBS.

Because plaintiffs have made allegations only slightly beyond conclusory allegations

that National and PBS were and are the alter egos of Postorivo, the Court GRANTS the

motion for judgment on the pleadings with leave to amend as to both National and PBS. 

2. Civil Conspiracy

The Court GRANTS the motion for judgment on the pleadings for civil conspiracy

because under California law civil conspiracy is not an independent tort. See Entm’t

Research Group, Inc. v. Genesis Creative, 122 F.3d 1211, 1228 (9th Cir. 1997). 

3. California Business Professions Code § 17200

The Court DENIES the motion for judgment on the pleadings for unfair competition

because the defendants have failed to meet their burden of showing that Cel-Tech

Communications, Inc. v. Los Angeles Cellular Tel. Co., 20 Cal. 4th 163 (1999), applies to

this case, that is, that this is a case between direct competitors.

4. Breach of Fiduciary Relationship

The Court DENIES the motion for judgment on the pleadings for breach of fiduciary

duty because plaintiffs have pled the elements of a confidential relationship and that such a

relationship gave rise to a fiduciary duty. 

5. Punitive Damages 

The Court DENIES the motion for judgment on the pleadings for punitive damages

because plaintiffs have stated a claim for punitive damages under the Ninth Circuit’s

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For the Northern District of California

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pleading requirements by alleging that the defendants acted with malicious intent. See 

Clark v. All-State Ins. Co., 106 F. Supp. 2d 1016, 1019 (S.D. Cal. 2000).

C. Motion to Dismiss or Change Venue

Defendants move to dismiss or transfer the case pursuant to 28 U.S.C. § 1406(a). 

Venue in the Northern District of California is proper under § 1391(a)(2) because a

substantial part of the events giving rise to the claim occurred in this District. 

Defendants also claim that they conducted business with plaintiffs via purchase

orders, which contained a forum selection clause requiring litigation to be brought in

Gloucester County Superior Court in New Jersey. Neither party has produced these purchase

orders, and plaintiffs deny that the forms exist. Accordingly, the Court DENIES defendants'

motion to dismiss or change venue on the ground of a forum selection clause without

prejudice. Defendants may renew the motion within 60 days on the basis of the forum

selection clause if defendants in good faith have evidence that plaintiffs agreed to such a

clause. 

D. Motion for Discretionary Change of Venue

Defendants also move to transfer venue under 28 U.S.C. § 1404(a). After balancing

relevant considerations, such as the plaintiffs’ choice of forum, ease of access to proof, the

availability of compulsory process, the courts’ relative familiarity with governing law, docket

congestion, and the location where the alleged contract(s) were negotiated and executed, the

Court concludes that the defendants have not made a strong showing that transfer to another

district serves the convenience of the parties and witnesses or is in the interest of justice. 

Therefore, the court DENIES defendants’ motion to transfer venue. 

E. Case Management Conference Date

The Court sets the parties’ next Case Management Conference (CMC) for November

2, 2007, at 8:30am before the Honorable Charles R. Breyer.

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For the Northern District of California

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F. Addition of KEE Action Sports, LLC

The Court also GRANTS plaintiffs leave to amend to add KEE Action Sports, LLC

(KEE) as a defendant. The Court orders plaintiffs to serve KEE with sufficient time before

the November 2, 2007 CMC.

IT IS SO ORDERED.

Dated: October 11, 2007 

CHARLES R. BREYER

UNITED STATES DISTRICT JUDGE

. 

Case 3:07-cv-01547-CRB Document 45 Filed 10/11/07 Page 5 of 5