Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_04-cv-05049/USCOURTS-cand-4_04-cv-05049-1/pdf.json

Parties Involved:
CFA Northern California, Inc.
Plaintiff
CRT Partners, LLP
Defendant
Robert Campbell
Defendant
Claire Thomas
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

CFA NORTHERN CALIFORNIA, INC.,

Plaintiff,

v.

CRT PARTNERS, LLP; CLAIRE THOMAS; and

ROBERT CAMPBELL,

Defendants.

 /

No. C 04-5049 CW

ORDER GRANTING IN

PART MOTION TO

DISMISS SECOND

AMENDED COMPLAINT

AND DENYING

MOTION TO

TRANSFER VENUE

Defendants move to dismiss Plaintiff's second amended

complaint pursuant to Federal Rules of Civil Procedure 12(b)(2) and

12(b)(6). In the alternative, Defendants move for an order

transferring this action to the District of Arizona. Plaintiff

opposes the motions. Having considered the parties' papers and the

evidence cited therein, the Court grants Defendants' motion to

dismiss the claims against Defendant Robert Campbell, denies their

motion to dismiss the claims against Defendant CRT Partners, LLP,

and Defendant Claire Thomas and denies Defendants' alternative

motion to transfer venue. 

BACKGROUND

As described by the Court in its previous order, CFA Northern

Case 4:04-cv-05049-CW Document 44 Filed 10/04/05 Page 1 of 6
United States District Court

For the Northern District of California

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Cal., Inc. v. CRT Partners, LLP, 378 F. Supp. 2d 1177 (N.D. Cal.

Jun. 21, 2005), granting in part Defendants' motion to dismiss and

denying Defendants' motion to transfer venue, Plaintiff CFA

Northern California, Inc. is a California corporation having its

principal place of business in California. Defendant CRT Partners,

LLP (CRT) is an Arizona limited liability partnership having its

principal place of business in Arizona. Defendants Claire Thomas

and Robert Campbell are residents of Arizona. 

 On November 30, 2004, Plaintiff filed the original complaint

and on March 31, 2005, Plaintiff filed an amended complaint

alleging (1) breach of contract, (2) unjust enrichment,

(3) conspiracy to defraud and (4) fraud, and claiming attorney's

fees. On April 22, 2005, Defendants filed a motion to dismiss the

amended complaint; Plaintiff opposed that motion. 

On June 24, 2005, during oral argument, the Court granted

Plaintiff leave to file a second amended complaint alleging that

its principal, Paul J. Johnson, is a licensed real estate broker. 

Plaintiff filed its second amended complaint on July 7, 2005. The

second amended complaint alleges that Johnson is a licensed Real

Estate Broker and that Plaintiff, through Johnson, holds a Real

Estate Broker License; attached to the complaint are two real

estate licenses issued to Plaintiff and Johnson by the State of

California. On July 20, 2005 -- one day before the Court issued

its Order Granting in Part Defendants' Motion To Dismiss and

Denying Motion to Transfer Venue -- Defendants filed this motion. 

In its July 21, 2005 order, the Court ruled that its exercise

of specific personal jurisdiction over Defendant CRT and Defendant

Case 4:04-cv-05049-CW Document 44 Filed 10/04/05 Page 2 of 6
United States District Court

For the Northern District of California

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Thomas was reasonable and afforded them the process they are due. 

The Court, however, ruled that it could not exercise jurisdiction

over Defendant Campbell based solely on his partnership in CRT and

therefore granted Defendants' motion to discuss the claims against

Campbell. The Court denied the motion to dismiss for failure to

state a claim and the motion to transfer venue.

LEGAL STANDARD 

I. Personal Jurisdiction 

 Under Rule 12(b)(2) of the Federal Rules of Civil Procedure, a

defendant may move to dismiss for lack of personal jurisdiction. 

In its previous order the Court described the legal standard for a

motion to dismiss pursuant to Rule 12(b)(2). See CFA Northern

Cal., 378 F. Supp. 2d at 1182-84. 

II. Failure to State a Claim 

 A motion to dismiss for failure to state a claim will be

denied unless it is "clear that no relief could be granted under

any set of facts that could be proved consistent with the

allegations." Falkowski v. Imation Corp., 309 F.3d 1123, 1132 

(9th Cir. 2002), citing Swierkiewicz v. Sorema N.A., 534 U.S. 506

(2002). The Court described this standard in its previous order. 

See id. at 1184.

III. Venue 

 If the Court determines that venue is improper in the Northern

District of California, it must dismiss or transfer the case. 

28 U.S.C. § 1404(a). The Court also described this standard in its

previous order. See id. at 1184-85.

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United States District Court

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DISCUSSION 

I. Personal Jurisdiction

Defendants urge the Court to revise its previous ruling

regarding personal jurisdiction, yet Defendants provide no new

arguments or facts. Instead, Defendants incorporate by reference

their arguments regarding personal jurisdiction set forth in their

April 22, 2005 motion -- the same arguments addressed by the Court

in its June 21, 2005 order. The Court will not revise its previous

ruling. Thus, based on the reasoning set forth in the June 21,

2005 order, the Court rules that it does not have jurisdiction over

Defendant Campbell, but does have specific personal jurisdiction

over Defendant CRT and Defendant Thomas. See CFA Northern Cal.,

378 F. Supp. 2d at 1885-87.

II. Failure to State a Claim

Defendants continue to assert that Plaintiff has failed to

state a claim upon which relief can be granted. Defendants argue

that Arizona law requires Plaintiff to have an Arizona real estate

broker's license to perform the contract between Plaintiff and CRT

because the restaurants for sale were situated on leased land, and

the proposed sale of the business was ancillary to or contingent on

the re-negotiation of these leases. Plaintiff has a California --

not Arizona -- real estate broker's license, and Defendants

therefore contend that the contract is illegal and cannot be

enforced. 

 Arizona Revised Statutes section 32-2101(47)(n)(2004) states

that a real estate broker’s license is required by a person other

than a salesperson who “[e]ngages in any of the acts listed in

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subdivisions (a) through (m) of this paragraph for the sale or

lease of other than real property if a real property sale or lease

is a part of, contingent on or ancillary to the transaction.”

Subsection (i) lists “[a]ssists or directs in the procuring of

prospects, calculated to result in the sale, exchange, leasing or

rental of real estate or timeshare interests” as one such act. 

Section 32-2163(B) provides that although an Arizona licensed

broker may enter into a fee sharing arrangement with an out-ofstate broker, an out-of-state broker is not permitted "to conduct

activity in this state that would otherwise require a broker's

license." See also A.R.S. § 32-2125.02(C) ("A non-resident

licensee shall accept employment or compensation as a non-resident

licensee only under Section 32-2155 and only from a broker who is

actively licensed in the state."). And section 32-2152 requires a

broker's claim for compensation to allege in the complaint that

"the plaintiff was a qualified licensed broker or salesperson at

the time the claim arose." Plaintiff, however, with its

California real estate broker's license, is not a qualified

licensed broker. 

But as discussed in the Court's previous order, Plaintiff's

amended complaint alleges that its contract with CRT excluded the

leaseholds. Plaintiff therefore argues that any sale would have

been conducted without a real estate transaction. The Court denies

Defendants' motion to dismiss for failure to state a claim for the

reasons explained in its previous order. See CFA Northern Cal.,

378 F. Supp. 2d at 1187-89. 

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III. Venue

Defendants also provide no new facts or arguments

demonstrating why the Court should alter its previous ruling on

venue. For the reasons explained in its previous order, the Court

denies Defendants' motion to transfer venue. See id. at 1889.

CONCLUSION

For the foregoing reasons, the Court DENIES Defendants' motion

to dismiss the claims against CRT and Thomas and their alternative

motion to transfer Venue (Docket No. 36). Defendants' motion to

dismiss the claims against Defendant Campbell for lack of

jurisdiction is GRANTED. As previously stated, however, if

Plaintiff were to sue Defendant Campbell in Arizona, however, the

Court would transfer this action there.

IT IS SO ORDERED.

Dated: 10/4/05

 

CLAUDIA WILKEN

United States District Judge

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