Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-06822/USCOURTS-cand-3_06-cv-06822-7/pdf.json

Parties Involved:
Ann Chapman
Defendant
Eleanor Lindquist
Plaintiff
Jeffrey C. Lindquist
Defendant
Jeff Payne
Defendant
Robert Vanden Bos
Defendant
Vanden Bos & Chapman
Defendant
Ian R. Yourtz
Defendant

Document Text:

United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

ELEANOR LINDQUIST,

Plaintiff,

 v.

ANN CHAPMAN, ROBERT VANDEN BOS,

VANDEN BOS & CHAPMAN, A Law Firm,

JEFF PAYNE, IAN R. YOURTZ, JEFFREY

C. LINDQUIST and FIRST DOE THROUGH

TENTH DOE, Inclusive,

Defendants. /

No. C 06-06822 WHA

ORDER GRANTING 

MOTIONS TO DISMISS FOR

LACK OF SUBJECT-MATTER

JURISDICTION AND DENYING

MOTIONS FOR RULE 11

SANCTIONS

INTRODUCTION

In this civil RICO action, defendants move to dismiss the first amended complaint. 

A prior order dismissed plaintiff Eleanor Lindquist’s original complaint for lack of

subject-matter jurisdiction. The amended complaint here has failed to correct the jurisdictional

flaws of the original pleading. Accordingly, defendants’ motions to dismiss for lack of

subject-matter jurisdiction are GRANTED.

STATEMENT

This action arises out of the activities of lawyers in two proceedings: (1) bankruptcy

proceedings in the District of Oregon against debtor (and defendant herein) Jeffrey Lindquist,

and (2) the dissolution of plaintiff’s marriage to Mr. Lindquist in San Mateo County Superior

Court. On June 17, 2005, the Oregon Bankruptcy Court issued an order staying all family-law

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court proceedings that could be initiated by plaintiff. The order provided, however, that

plaintiff could proceed with the dissolution-of-marriage proceeding before the San Mateo

Superior Court. The order allowed the divorce to be entered but did not allow for determination

of a property settlement or spousal support (Compl. Exh. A). 

Plaintiff proceeded to move for spousal support in San Mateo Superior Court. On

January 17, 2006, defendant Yourtz tendered the bankruptcy court’s order in the family-law

court in connection with a hearing regarding plaintiff’s entitlement to spousal support. The

San Mateo commissioner honored the bankruptcy court’s order and awarded $1,000 in

sanctions against plaintiff for violating the stay. Plaintiff immediately filed a motion in the

Ninth Circuit for relief from the stay. She concurrently filed a petition for writ of mandamus. 

The motion for relief was granted on January 30, 2006. The Ninth Circuit’s January 2006 order

held that plaintiff could seek relief in the San Mateo County Superior Court for spousal support,

medical insurance, division of community of property, and any other relief related to the

dissolution of marriage (Compl. Exh. B).

Four months later, on May 25, 2006, the Ninth Circuit granted plaintiff’s petition for a

writ of mandamus. The Ninth Circuit ordered the bankruptcy court to grant petitioner the relief

she would have been entitled to if the bankruptcy court’s orders had not been entered,

“including status as a priority claimant in the real party in interest’s bankruptcy if [plaintiff]

otherwise proves her entitlement to such relief” (Compl. Exh. C).

Plaintiff’s first amended complaint alleges the same six claims that were alleged in the

original complaint: (1) malicious prosecution, (2) fraud and deceit, (3) intentional infliction of

emotional distress, (4) negligent infliction of emotional distress, (5) conspiracy, and

(6) violation of RICO statutes. Plaintiff names six defendants in her complaint. Defendant

Jeffrey Lindquist is plaintiff’s estranged husband. Defendant Vanden Bos & Chapman is an

Oregon law firm specializing in bankruptcy. Defendant Ann Chapman and Robert Vanden Bos

are Oregon attorneys who are partners with the law firm and defendant Jeff Payne is an

associate at the law firm. Vanden Bos & Chapman represent Mr. Lindquist in the Oregon

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bankruptcy proceeding. Defendant Ian Yourtz is a California attorney practicing in Menlo

Park, California. Yourtz represents Mr. Lindquist in the San Mateo Superior Court family-law

proceedings.

The Court has already ruled on one motion to dismiss in this action. By order dated

February 6, 2007, the Court granted defendant Yourtz’s motion to dismiss for lack of

subject-matter jurisdiction. The only federal claim asserted in the original complaint was

brought under the civil RICO statute. The February 6 order found the civil RICO claim to be

“wholly insubstantial and frivolous” and accordingly held that subject-matter jurisdiction was

lacking. Furthermore, plaintiff had also failed to overcome the presumption against diversity

jurisdiction. 

Plaintiff filed an amended complaint on February 23, 2007. In addition, plaintiff, who

had been represented by an attorney, filed a notice of substitution of counsel on February 23 and

began representing herself. All defendants now move to dismiss on various grounds. 

Defendants Vanden Bos, Chapman, Payne, and Vanden Bos & Chapman move to dismiss for

lack of personal jurisdiction. Defendants Yourtz and Lindquist move to dismiss for lack of

subject-matter jurisdiction and for failure to state a claim. This order addresses whether

subject-matter jurisdiction exists.

ANALYSIS

A Rule 12(b)(1) challenge to subject-matter jurisdiction should be decided before other

grounds for dismissal because the other grounds will become moot if dismissal is granted. 

See Alvares v. Erickson, 514 F.2d 156, 160 (9th Cir. 1975). A party seeking to prove

jurisdiction must overcome the presumption that a federal court lacks subject-matter

jurisdiction. See Stock West, Inc. v. Confederated Tribes, 873 F.2d 1221, 1225 (9th Cir. 1989). 

This order also notes that although a pro se complaint should be construed liberally, “a liberal

interpretation of a . . . complaint may not supply essential elements of the claim that were not

initially pled.” Ivey v. Bd. of Regents, 673 F.2d 266, 268 (9th Cir. 1982). 

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“In order to invoke federal jurisdiction ‘for the purposes of determining whether [the

plaintiff] stated a cause of action on which relief could be granted,’ the complaint must fulfill

only two criteria: (1) it must ‘claim a right to recover under the Constitution and laws of the

United States,’ and (2) the claim must not be ‘wholly insubstantial and frivolous.’” Keniston v.

Roberts, 717 F.2d 1295, 1298 (9th Cir. 1983). Here, the amended complaint alleges that

federal-question jurisdiction exists based on an alleged violation of the civil RICO statute,

18 U.S.C. 1964, and for an alleged violation of federal civil rights, 28 U.S.C. 1343(a)(3). 

As discussed below, federal-question jurisdiction does not exist under either of these provisions.

Jurisdiction does not lie here based on any alleged violation of federal civil rights. 

Section 1343(a)(3) establishes that a district court will have jurisdiction to “redress the

deprivation, under color of any State law, statute, ordinance, regulation, custom or usage, of any

right, privilege or immunity secured by the Constitution of the United States or by any Act of

Congress providing for equal rights of citizens or of all persons within the jurisdiction of the

United States.” Other than the statement of jurisdiction, however, nothing in the complaint

discusses an alleged violation of civil rights. Plaintiff has therefore not even attempted to plead

a claim for a violation of her civil rights. Plaintiff conceded this point at the hearing on the

instant motions.

As with the original complaint, plaintiff’s sixth claim, brought under the civil RICO

statute, 18 U.S.C. 1962, is her only claim brought under a federal statute. To invoke

federal-question subject-matter jurisdiction here, the claim must not be “wholly insubstantial or

frivolous.” As with plaintiff’s previous complaint, the amended pleading’s allegation of a civil

RICO claim remains insubstantial and frivolous and therefore provides no basis to support

federal-question jurisdiction. 

The civil RICO statute, 18 U.S.C. 1962(a), provides: “It shall be unlawful for any

person who has received any income derived, directly or indirectly, from a pattern of

racketeering activity or through collection of an unlawful debt in which such person has

participated as a principal . . . to use or invest, directly or indirectly, any part of such income, or

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the proceeds of such income, in acquisition of any interest in, or the establishment or operation

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

commerce.” To state a civil RICO claim, plaintiff must allege: (1) conduct, (2) of an

enterprise, (3) through a pattern, (4) of racketeering activity, (5) causing injury to plaintiff’s

business or property. See Chang v. Chen, 80 F.3d 1293, 1298–1300 (9th Cir. 1996). 

Plaintiff’s first amended complaint attempts to take the same factual allegations set forth

in the original complaint and assert again that they constitute a viable RICO claim. Plaintiff

lists ten predicate acts by defendants that she claims support a RICO claim: (1) filing of a

“fraudulent Bankruptcy” to “obtain a discharge of spousal support and of community property

of the marriage”; (2) sending a letter to plaintiff informing her that the filing of the bankruptcy

creates an automatic stay preventing a spouse from receiving any spousal support; (3)

presenting an order prohibiting plaintiff from moving the family law court for spousal support;

(4) making a promise in the bankruptcy court that plaintiff would receive spousal support

during the three-year term of the Chapter 13 plan and having no intentions of making such

payments; (5) presenting a Chapter 13 plan to the bankruptcy court that was “Forbidden by

Law” as it set payments for spousal support in bankruptcy court without intending on making

such payments; (6) sending to defendant Yourtz the “fraudulently obtained order of June 17,

2005”; (7) obtaining certified copies of the bankruptcy court order and other bankruptcy

documents and mailing those copies to defendant Yourtz with the intent of furthering the

“bankruptcy fraud to prevent any and all orders for spousal support from being entered”; (8)

opposing plaintiff’s motion on February 21, 2006, for reconsideration of the order imposing

sanctions “even though the order of June 17, 2005 was at all times void on its face”; (9)

opposing plaintiff’s motion for a writ of mandamus; (10) filing amended schedules in the

bankruptcy court showing that Mr. Lindquist had assets that apparently had not been listed in

the previous bankruptcy schedules (Compl. ¶ 65).

Construing the complaint liberally, it is impossible to see how these facts establish a

civil RICO claim. Plaintiff’s basic premise is that defendants committed wrongful conduct by

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 In opposition, plaintiff cites Salinas v. United States, 522 U.S. 52, 65 (1997), for the unremarkable

proposition that “[a] conspirator must intend to further an endeavor which, if completed, would satisfy all of the

elements of a substantive criminal offense, but it suffices that he adopt the goal of furthering or facilitating the

criminal endeavor.” The Supreme Court held that although “an ‘enterprise’ under § 1962(c) can exist with only

one actor to conduct it, in most instances it will be conducted by more than one person or entity; and this in turn

may make it somewhat difficult to determine just where the enterprise ends and the conspiracy begins, or, on the

other hand, whether the two crimes are coincident in their factual circumstances.” Plaintiff alleges that “it is not

necessary that the substan[tive] violation actually be consummated for the conspiracy violation to be completed”

(Opp. 10). But that proposition has no value where, as here, no acts constituting a “pattern of racketeering

activity” have been alleged.

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receiving an “illegal” order from the Oregon bankruptcy court and tendering it to the San Mateo

County Superior Court. This is a faulty premise. It is true that the Ninth Circuit’s orders

indicate that the bankruptcy court should never have issued its order staying the family-law

proceedings. But obtaining the order from the bankruptcy court and presenting it to the

San Mateo court was not a “pattern of racketeering activity.” The conduct here does not fall

under any of the categories of “racketeering activity” enumerated in 18 U.S.C. 1961(1), which

require at least an allegation of fraud. See, e.g., 18 U.S.C. 1961(1)(D). The amended complaint

alleges that defendants’ acts constitute bankruptcy fraud, 18 U.S.C. 1961(1)(D), but fails to

allege the circumstances of fraud with particularity. See Fed. R. Civ. P. 9(b). Moreover, it is

difficult, if not impossible, to see how plaintiff could allege that defendants’ alleged conduct

could constitute actionable fraud.

Furthermore, it is true that while the bankruptcy court’s order was in effect, plaintiff was

prevented from obtaining a spousal-support award in family court. Plaintiff has not, however

shown that “she was injured by the use or investment of racketeering income.” Wagh v. Metris

Direct, Inc., 363 F.3d 821, 828 (9th Cir. 2003). Nor is it clear how such fraud was the

proximate cause of any injury to plaintiff. See Hamid v. Price Waterhouse, 51 F.3d 1411, 1419

(9th Cir. 1995). The conduct alleged in the amended complaint is simply not “an activity which

RICO was designed to deter.” Sedima, S.P.R.L. v. Imrex Co., Inc., 473 U.S. 479, 496 (1985). 

As with the original complaint, the alleged RICO violation is wholly insubstantial and

frivolous. Subject-matter jurisdiction remains lacking over this matter.1

CONCLUSION

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 Defendants contend that plaintiff’s oppositions should not be considered because they were filed one

day late. Defendants, however, filed timely replies. Because there was no prejudice, the objections to the

late-filed oppositions are OVERRULED.

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For the foregoing reasons, the motions to dismiss for lack of subject-matter jurisdiction

are GRANTED. This order need not address defendants’ further contentions that this Court lacks

personal jurisdiction over the Oregon-based defendants or that plaintiff has not stated claims

upon which relief can be granted. Generally, an action should not be dismissed for lack of

subject-matter jurisdiction without giving the plaintiff an opportunity to amend. See May Dept.

Store v. Graphic Process Co., 637 F.2d 1211, 1216 (9th Cir. 1980). But plaintiff has already

been given one chance to amend. Furthermore, “it is clear the deficiency cannot be overcome

by amendment.” Ibid. These facts will never constitute a basis for a civil RICO violation. 

Accordingly, plaintiff will not be granted further leave to amend.2

The Court has considered defendants’ previous Rule 11 motion in light of all subsequent

developments. That motion is DENIED. Additionally, plaintiff’s motion for Rule 11 sanctions,

filed on April 25, 2007, is also DENIED. No new motions for Rule 11 sanctions may be filed. 

This case is over at the district court level. All parties are reminded of their need to be timely in

filing any appeals.

IT IS SO ORDERED.

Dated: April 26, 2007. WILLIAM ALSUP

UNITED STATES DISTRICT JUDGE

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