Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_05-cv-01187/USCOURTS-caed-1_05-cv-01187-1/pdf.json

Parties Involved:
Clean Air Products, Inc.
Defendant
Darrin Simmons
Defendant
Thomas N. Smith
Plaintiff

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

THOMAS N. SMITH,

 Plaintiff,

 v. 

DARRIN SIMMONS dba CLEAN AIR

PRODUCTS, INC., 

 Defendants.

1:05-CV-01187 OWW LJO 

ORDER GRANTING DEFENDANTS’

UNOPPOSED MOTION TO DISMISS

THE THIRD CAUSE OF ACTION

FOR FRAUD.

This is a diversity action for breach of contract and fraud

brought by Thomas N. Smith (“Plaintiff”), a resident of New

Zealand, against Darrin Simmons and Clean Air Products

(“Defendants”). (Doc. 19, Second Amended Complaint.) Plaintiff

is the sole owner of Land O’Goshen Inc., which allegedly entered

into a series of written agreements with Defendants pursuant to

which Defendants were to acquire various business property and

services previously owned by “Help Smog Parts.” (Id.) Among

other things, Plaintiff alleges that Defendant Simmons committed

fraud by making the following representations to Plaintiff:

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That he would purchase the [various] properties from

Plaintiff Land O’Goshen for the agreed upon price of

$430,000 less a $70,000 down payment. Defendant signed

the agreement (Exhibit 1) representing that the

payments for the remaining $360,000 owed to Plaintiff

would be paid as follows: 

(a) $60,000 at the rate of $5,000 per month beginning

January 1, 1999 and ending December 31, 1999 with

no interest. 

(b) $60,000 shall be paid in lump sum on January 1,

2000 for that calendar year with no interest

(c) The remaining balance of $240,000 shall be due and

payable on January 1, 2001, or shall continue with

mutual consent, including 10% interest. 

Plaintiff alleges that these representations were “false”

and that Defendants “were not in a position to be able to make

all of the payments and...had no intention of making the agreed

payments.” (Id. at ¶21.) 

Defendant Simmons moves to dismiss for failure to comply

with the heightened pleading requirements of Federal Rule of

Civil Procedure 9b. (Doc. 20, filed July 25, 2006). Plaintiff

does not oppose the motion, but requests that it be granted with

leave to amend at a future date, should discovery reveal

information that would support a fraud allegation. (Doc. 22,

filed August 28, 2006.)

Rule 9(b) requires that when pleading “special matters,”

such as fraud, the “circumstances constituting fraud...shall be

stated with particularity.” Fed. R. Civ. P. 9(b). Rule 9(b)

require’s that the complaint “state the time, place and content

of a misrepresentation and explain why the statement is false or

misleading.” Vess v. Ciba-Geigy Corp., USA, 317 F.3d 1097, 1107,

(9th Cir. 2003)(citing In re. GlenFed, Inc. Secur. Litig., 42

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F.3d 1541, 1547 (9th Cir. 1994)). Here, Plaintiff has simply

suggested that Defendant’s purported failure to perform under a

written contract is evidence of some fraudulent intent. More is

required to satisfy Rule 9(b). 

Accordingly, Defendants’ motion to dismiss the third cause

of action is GRANTED WITHOUT PREJUDICE. 

SO ORDERED

Dated: 9/14/06 /s/ Oliver W. Wanger

OLIVER W. WANGER

United States District Judge

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