Vashisht-Rota v. Howell Management Services

[7] 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA [10] 11 APARNA VASHISHT-ROTA, Case No.: 3:20-cv-00321-RBM-KSC 12 Plaintiff, ORDER: 13 v. (1) GRANTING PLAINTIFF’S 14 HOWELL MANAGEMENT SERVICES, MOTION TO FILE et al. 15 SUPPLEMENTAL AUTHORITY Defendants. (Doc. 193); [16] 17 (2) GRANTING DEFENDANTS’ MOTION TO DISMISS [18] PLAINTIFF’S THIRD AMENDED 19 COMPLAINT (Doc. 119); [20] (3) DENYING PLAINTIFF’S 21 MOTION FOR LEAVE TO FILE FOURTH AMENDED COMPLAINT [22] (Doc. 128); [23] (4) DENYING PLAINTIFF’S [24] MOTION FOR LEAVE TO FILE 25 FIFTH AMENDED COMPLAINT AS MOOT (Doc. 212); AND [26] 27 (5) DENYING PLAINTIFF’S MOTION FOR SPECIAL MASTER [28] 1 (Doc. 192) [2] [Docs. 119, 128, 192, 193, 212] [3] 4 On November 16, 2020, Defendants Howell Management Services (“HMS”) and 5 Chris Howell (“Howell”) (collectively “Defendants”) filed a motion to dismiss Plaintiff’s 6 third amended complaint (Doc. 127) (“TAC”) pursuant to Federal Rule of Civil Procedure 7 12(b)(6) (“Motion”).1 (Doc. 119.) Plaintiff Aparna Vashisht-Rota (“Plaintiff” or 8 “Vashisht-Rota”), appearing pro se, filed an opposition on November 20, 2020. (Doc. 9 120.) Defendants filed a reply on February 10, 2021, and a notice of supplemental authority 10 on July 21, 2021. (Docs. 129, 148.) 11 On December 3, 2020, Plaintiff filed a motion for leave to file a fourth amended 12 complaint (“Motion for Leave”). (Doc. 128.) Defendants filed an opposition on February 13 17, 2021. (Doc. 134.) Plaintiff filed a reply on March 7, 2021. (Doc. 143.) On September 14 25, 2022, Plaintiff filed a motion to file supplemental authority (“Motion to File 15 Supplemental Authority”) in support of her fourth amended complaint and in opposition to 16 Defendants’ supplemental authority. (Doc. 193.) Good cause appearing, the Court 17 GRANTS Plaintiff’s Motion to File Supplemental Authority. 18 On October 22, 2022, Plaintiff filed a motion for leave to file a fifth amended 19 complaint. (Doc. 212.) Defendants filed on opposition on November 7, 2022. (Doc. 219.) [21] 1 Accompanying Defendants’ Motion is a request for judicial notice of various court and [22] administrative records, some of which are documents that have been ordered sealed which 23 bear directly on the issue of whether Plaintiff’s claims are barred by collateral estoppel. (Doc. 119-2 at 2; see also Docs. 26, 27.) In deciding the present motions, the Court takes [24] judicial notice of the filings from the prior federal actions and pending state court action. 25 See United States v. Black, 482 F.3d 1035, 1041 (9th Cir. 2007) (a court “may take notice of proceedings in other courts, both within and without the federal judicial system, if those [26] proceedings have a direct relation to matters at issue.”); see also ScripsAmerica, Inc. v. 27 Ironridge Glob. LLC, 56 F. Supp. 3d 1121, 1136 (C.D. Cal. 2014) (“[i]t is well established that federal courts may take judicial notice of related state court orders and proceedings.”). [28] 1 On October 24, 2022, Plaintiff filed a motion to appoint a special master seeking 2 appointment of a master to issue rulings on a case pending in Utah state court. (Doc. 192.) 3 Defendants filed an opposition on October 10, 2022. (Doc. 194.) Plaintiff filed a reply, 4 and then an “update” to her reply. (Docs. 195, 197.) 5 For the reasons below, Plaintiff’s motion to appoint a special master is DENIED, 6 Defendants’ Motion to Dismiss is GRANTED, Plaintiff’s Motion for Leave to File Fourth 7 Amended Complaint is DENIED, Plaintiff’s Motion for Leave to File Fifth Amended 8 Complaint is DENIED AS MOOT, and Plaintiff’s claims are dismissed WITH 9 PREJUDICE. 10 I. BACKGROUND 11 From October 2015 to March 2017, Defendants contracted with Plaintiff to refer 12 foreign and domestic students to HMS and to have those students enrolled at universities 13 associated with HMS. The parties entered a series of agreements titled as an “HMS 14 Authorized Representative Agreement.” The parties’ business relationship ultimately 15 ended and has prompted extensive litigation in Utah state court and California federal court 16 regarding the parties’ conduct and obligations during and after the contractual relationship. 17 A. Pending Utah Litigation 18 On November 2, 2017, HMS2 filed a complaint against Vashisht-Rota and her entity 19 August Education Group, LLC (“AEG”) in the First District, Cache County, Utah state 20 court (“Utah Litigation”). (See Decl. of Elizabeth M. Butler in Support of Defs.’ Mot. to 21 Dismiss (Nov. 16, 2020) (“November 2020 Butler Declaration”), Doc. 119-3, Ex. 1 at 6.) 22 The Utah Litigation is premised upon Vashisht-Rota’s alleged termination of an agreement 23 between the parties and her subsequent harassing and threatening communications with 24 Defendant HMS and its principals. The operative second amended complaint pursues the 25 following relief and/or claims against Vashisht-Rota: (1) declaratory relief that HMS owes [27] 2 Although Howell is named as a party in the instant litigation, he is not a party to the Utah [28] 1 no money to AEG and/or Vashisht-Rota; (2) breach of contract related to the independent 2 contractor agreement; (3) intentional interference with existing economic relations; (4) 3 defamation; (5) injurious falsehood; and (6) injunctive relief related to AEG and/or Rota’s 4 breach of contract and email harassment campaign. (See Decl. of Elizabeth M. Butler in 5 Support of Mot. to Dismiss (Apr. 27, 2020) (“April 2020 Butler Declaration”), Doc. 20, 6 Ex. 2; see also Docs. 26-27.) 7 On February 1, 2018, Vashisht-Rota filed a motion to stay the Utah Litigation 8 pending arbitration. (Nov. 2020 Butler Decl., Doc. 119-3, Ex. 1 at 6.) On June 29, 2018, 9 the Utah court denied the motion to compel arbitration, finding that the binding agreement 10 between the parties—the HMS Authorized Representative Agreement dated April 24, 2017 11 (“Third Agreement”) (Doc. 27 at 45-51)—lacked an arbitration clause. (Apr. 2020 Butler 12 Decl., Doc. 20, Ex. 3; see also Docs. 26-27.) The Utah court highlighted the agreement’s 13 choice of law and forum selection clauses, where the parties agreed that Utah law governed 14 and submitted to the exclusive jurisdiction of the Courts of the State of Utah. (see id.) 15 Vashisht-Rota, who was represented by counsel at the time, subsequently filed an 16 answer to the second amended complaint and counterclaim. (Nov. 2020 Butler Decl., Doc. 17 119-3, Ex. 1 at 6.) Vashisht-Rota’s counterclaims against Defendant HMS include the 18 following: (1) breach of contract related to the Third Agreement; (2) breach of the duty of 19 good faith and fair dealing related to the Third Agreement; and (3) unjust enrichment. 20 (Apr. 2020 Butler Decl., Doc. 20, Ex. 4; see also Docs. 26-27.) According to Defendants, 21 the Utah court struck Vashisht-Rota’s answer and counterclaim as a sanction and all that 22 remains is a trial to determine Defendant HMS’s damages. (Doc. 119-1 at 10.) 23 B. Prior Litigation in this District 24 i. 2018 Action 25 In July 2018, Vashisht-Rota, who was represented by counsel at the time, filed suit 26 against HMS and Howell in San Diego Superior Court, which Defendants removed to this 27 Court. See generally Rota v. Howell Management Services, et. al., No. 3:18-cv-02010-L28 AGS (the “2018 Litigation”). Plaintiff asserted the following claims against Defendants: 1 (1) failure to pay minimum wage in violation of California Labor Code; (2) failure to pay 2 overtime in violation of California Labor Code; (3) failure to pay promised wages; (4) 3 failure to pay compensation at time of termination in violation of California Labor Code; 4 (5) failure to reimburse out-of-pocket expenses in violation of California Labor Code; and 5 (6) unlawful and unfair business practices in violation of California Business & Professions 6 Code section 17200 et seq. See 2018 Litigation Docket, Doc. 1-2. On May 28, 2019, 7 District Judge M. James Lorenz granted Defendants’ motion to dismiss, finding Plaintiff’s 8 claims as compulsory counterclaims that should have been included in the Utah Litigation. 9 See 2018 Litigation Docket, Doc. 22 at 3-5. The Ninth Circuit affirmed, finding the district 10 court properly dismissed the claims because they arose from the same transaction or 11 occurrence as the claims in the pending Utah Litigation. See 2018 Litigation Docket, Doc. 12 34. 13 ii. 2019 Action 14 In March 2019, Vashisht-Rota, who was represented by counsel at the time, filed 15 another suit against Defendants.3 See generally Rota v. Howell Management Services, 16 LLC, No. 3:19-cv-0512-L-MDD (the “2019 Litigation”). Plaintiff asserted the following 17 claims against Defendants: (1) sexual harassment; (2) unlawful gender/sex discrimination; 18 (3) unlawful race discrimination; (4) unlawful national origin discrimination; (5) 19 retaliation; (6) retaliation in violation of the California Labor Code; (7) constructive 20 discharge; (8) intentional infliction of emotional distress; (9) failure to prevent and remedy 21 unlawful discrimination and harassment; (10) failure to correct and remedy unlawful 22 discrimination and harassment; and (11) violation of equal pay. See 2019 Litigation 23 Docket, Doc. 1. Defendants filed a motion to dismiss, seeking dismissal because the claims 24 were compulsory counterclaims that should have been pursued in the Utah Litigation, or 25 alternatively, dismissed based upon forum non conveniens. See 2019 Litigation Docket, [27] 3 This complaint also named Justin Spencer, a Utah resident affiliated with HMS, as a [28] 1 Doc. 6. Judge Lorenz ruled that Vashist-Rota’s claims were not compulsory counterclaims 2 that must be included in the Utah Litigation. See 2019 Litigation Docket, Doc. 18 at 4-6. 3 Judge Lorenz reasoned that the claims did not arise under the same facts, because the 2019 4 Litigation focused on HMS and Howell’s behavior during the contract relationship and 5 Utah Litigation focuses on Vashisht-Rota’s behavior after the contract relationship ended. [6] Id. However, given the Third Agreement’s forum selection clause, Judge Lorenz dismissed 7 the 2019 Litigation based upon forum non conveniens and 28 U.S.C. § 1404 (a). Id. at 68 10. The Ninth Circuit affirmed the decision, but on a different ground. See 2019 Litigation 9 Docket, Doc. 25. The Ninth Circuit found Vashisht-Rota’s claims in the 2019 Litigation 10 to be compulsory to the pending Utah Litigation, as the claims arose from the same 11 transaction or occurrence. Id. (relying in part on Pochiro v. Prudential Ins. Co. of America, [12] 827 F.2d 1246, 1249 (9th Cir. 1987) (“The question whether the [Plaintiff’s] claims are 13 compulsory counterclaims which should have been pleaded in the earlier. . . state court 14 action is a question of state law.”); Yanaki v. Iomed Inc., 116 P.3d 962, 963-65 (Utah Ct. 15 App. 2005 ) (under Utah R. Civ. P. 13(a)(1), employee’s discrimination claims were 16 compulsory counterclaims that should have been filed in employer’s earlier-filed action, 17 even if administrative remedies were not yet exhausted; the employment relationship was 18 the transaction or occurrence that was the subject matter of the employer’s claims)). 19 C. Present Action 20 The TAC (Doc. 127) asserts the following claims against Defendants: (1) unlawful 21 and unfair business practices; (2) unfair competition; (3) fraud; (4) false promises; (5) 22 unpaid wages and expenses; (6) defamation under California law; (7) Racketeer Influenced 23 and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1964 . Plaintiff’s Motion for Leave 24 to File a Fourth Amended Complaint seeks to add nine new claims and three new 25 Defendants, Justin Spencer, Franck Trocki, and Michael Hernandez. (Doc. 128.) The new [28] 1 claims include: (1) equitable remedy of specific performance; (2) equitable remedy of 2 injunctive relief; (3) equitable rescission; (11) sexual harassment in violation of California 3 Government Code; (12) violation of California Civil Code § 51.5; (13) failure to prevent 4 discrimination in violation of California Civil Code; (14) conspiracy to interfere with First 5 Amendment Rights in violation of 42 U.S.C. § 1985 (3); (15) abuse of process; and (16) 6 negligence. (Id.) Plaintiff’s “supplemental authority” (Doc. 193) in support of her fourth 7 amended complaint submits “several documents in support of her bias claims.” (Doc. 193 8 at 1.) While Plaintiff also includes an exhibit purporting to support a misappropriation of 9 trade secrets claim, such claim has not been included in the fourth amended complaint and 10 thus will not be considered. (Id.) 11 D. Related Cases Pending in this District 12 Vashisht-Rota has filed four other related cases pending before the undersigned, all 13 of which she is appearing pro se. See Vashisht-Rota v. Ottawa Univ., No. 20-cv-95914 RBM-KSC; Vashisht-Rota v. Harrisburg Univ., No. 20-cv-967-RBM-KSC; Vashisht15 Rota v. Bluechip Servs., No. 22-cv-900-RBM-KSC; and Vashisht-Rota v. Utah Attorney 16 General, No. 22-cv-978. Defendants HMS and Howell are also named as Defendants in 17 Vashisht-Rota v. Bluechip Services, and have filed a motion to dismiss which is fully 18 briefed. See, No. 22-cv-900-RBM-KSC, Doc. 4. 19 II. LEGAL STANDARD 20 Pursuant to Federal Rule of Civil Procedure (“Rule”) 12(b)(6), an action may be 21 dismissed for failure to allege “enough facts to state a claim to relief that is plausible on its 22 face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial 23 plausibility when the plaintiff pleads factual content that allows the court to draw the 24 reasonable inference that the defendant is liable for the misconduct alleged. The 25 plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a [27] 4 The fourth through tenth causes of action in the fourth amended complaint are the same [28] 1 sheer possibility that a defendant acted unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662 , 678 2 (2009) (internal citations omitted). For purposes of ruling on a Rule 12(b)(6) motion, the 3 Court “accept[s] factual allegations in the complaint as true and construe[s] the pleadings 4 in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & Marine 5 Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). 6 Moreover, when an action is filed by a pro se litigant, “the court must construe the 7 pleadings liberally and must afford plaintiff the benefit of any doubt.” Karim-Panahi v. 8 Los Angeles Police Dep’t, 839 F.2d 621 , 623 (9th Cir. 1988). “A pro se litigant must be 9 given leave to amend his or her complaint unless it is ‘absolutely clear that the deficiencies 10 of the complaint could not be cured by amendment.’” Noll v. Carlson, 809 F.2d 1446 , 11 1447 (9th Cir. 1987) (quoting Broughton v. Cutter Labs., 622 F.2d 458, 460 (9th Cir. 12 1980)). However, in giving liberal interpretation to a pro se complaint, courts may not 13 “supply essential elements of claims that were not initially pled.” Ivey v. Bd. of Regents of 14 the Univ. of Alaska, 673 F.2d 266, 268 (9th Cir. 1982). 15 If the court dismisses a complaint for failure to state a claim, it must then determine 16 whether to grant leave to amend. Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995). 17 “A district court may deny a plaintiff leave to amend if it determines that ‘allegation of 18 other facts consistent with the challenged pleading could not possibly cure the deficiency,’ 19 or if the plaintiff had several opportunities to amend its complaint and repeatedly failed to 20 cure deficiencies.” Telesaurus VPC, LLC v. Power, 623 F.3d 998, 1003 (9th Cir. 2010) 21 (internal quotation marks and citations omitted). In deciding whether justice requires 22 granting leave to amend, factors to be considered include “undue delay, bad faith or 23 dilatory motive on the part of the movant, repeated failure to cure deficiencies by 24 amendments previously allowed, undue prejudice to the opposing party by virtue of 25 allowance of the amendment [or] futility of amendment.” Foman v. Davis, 371 U.S. 178 , 26 182 (1962); see also Moore v. Kayport Package Exp., Inc., 885 F.2d 531 , 538 (9th Cir. 27 1989). 28 / / / 1 III. DISCUSSION 2 A. Motion to Appoint Special Master 3 Before analyzing the claims in the TAC and pending Motion to Dismiss, the Court 4 will preliminarily address Plaintiff’s request for the Court to appoint a special master to 5 issue rulings in the pending Utah Litigation. (Doc. 192.) Other than citing Federal Rule 6 of Civil Procedure 53 (which does not apply in this circumstance), Plaintiff cites no binding 7 authority to support her request for this Court to intervene in the pending state court 8 proceeding. Accordingly, Plaintiff’s motion to appoint a special master is DENIED. 9 B. Motion to Dismiss 10 Defendants’ Motion argues that Plaintiff’s TAC should be dismissed because her 11 attempt to pursue litigation duplicative of the 2018 and 2019 Litigations violates the rule 12 against claim splitting and collateral estoppel. (Doc. 119-1 at 13-17.) As to the collateral 13 estoppel argument, Defendants contend that the issue of whether Vashisht-Rota’s claims 14 should be dismissed on grounds of them being compulsory counterclaims to the Utah 15 Litigation or alternatively dismissed pursuant to forum non conveniens, have already been 16 fully and fairly litigated in the 2018 and 2019 Litigations. (Id. at 18-30.) Finally, 17 Defendants contend the defamation and RICO claims fail as a matter of law under Rule 18 12(b)(6). (Id. at 30-31.) 19 Vashisht-Rota’s response is difficult to construe. It appears she is arguing that her 20 instant case is factually different from the Utah Litigation such that her claims may proceed 21 in this District, and they are not compulsory counterclaims. (Doc. 120 at 3, 7.) She also 22 argues various equitable grounds to allow this case to proceed separately from the Utah 23 Litigation, including specific performance of the Second Agreement between the parties or 24 equitable rescission of the Third Agreement. (Id. at 5-7.) 25 As outlined below, collateral estoppel and the 12(b)(6) analysis of the defamation 26 and RICO claims are determinative for purposes of ruling upon Defendant’s Motion. As 27 such, the Court need not reach the issue of whether Plaintiff’s claims violate the rule against 28 claim splitting. 1 i. Collateral Estoppel 2 A federal district court sitting in diversity applies state preclusion law to determine 3 the effect of a prior dismissal by a federal court sitting in diversity. Semtek Int’l Inc. v. 4 Lockheed Martin Corp., 531 U.S. 497, 508-509 (2001); Gustafson v. U.S. Bank N.A., 618 5 F. App’x 921 , 922 (9th Cir. 2015); Daewoo Elecs. America Inc. v. Optca Corp., 875 F.3d 6 1241, 1246-1247 (9th Cir. 2017) (“federal common law requires that we determine the 7 preclusive effect of the prior decision by reference to the law of the state where the 8 rendering federal diversity court sits.”). This necessarily requires application of “the law 9 that would be applied by state courts in the State in which the federal diversity court sits.” 10 Semtek, 531 U.S. at 508 . 11 In the 2018 Action, Vashisht-Rota originally filed suit in California state court, but 12 Defendants HMS and Howell removed it to this District claiming diversity jurisdiction. 13 See 2018 Litigation Docket, Doc. 1. Vashisht-Rota is a citizen of California and 14 Defendants HMS and Howell are citizens of Utah. Id. at 1-4. Defendants alleged the 15 amount in controversy exceeded $75,000. Id. at 3-4. Judge Lorenz denied Vashist-Rota’s 16 motion for remand, finding that Defendants sufficiently demonstrated the amount in 17 controversy requirement. Id. at Doc. 21. In the 2019 Action, Vashisht-Rota filed suit in 18 this District, claiming diversity jurisdiction. See 2019 Litigation Docket, Doc. 1. Thus, 19 the Court sat in diversity jurisdiction over the 2018 and 2019 Actions. As a result, state 20 law governs the preclusive effect of those prior federal court judgments. See Semtek, 531 21 U.S. at 507. 22 Here, the forum state is California, such that its preclusion law would apply. 23 Defendant, however, contends that “a California court would enforce the parties’ choice of 24 law and look to Utah law” because the Third Agreement specifies that any claim or action 25 arising under the agreement “shall be governed by and construed in accordance with the 26 laws of the State of Utah.” (Doc. 119-1 at 16 (citing Bridge Fund Capital Corp. v. 27 Fastbucks Franchise Corp., 622 F.3d 996, 1002 (9th Cir. 2010)); see also Doc. 27-2 at 49.) 28 / / / 1 It is of no practical consequence whether the Court applies California or Utah issue 2 preclusion law, as the states have similar analysis. Accordingly, the Court will apply the 3 default California law. In California, “issue preclusion prohibits the relitigation of issues 4 argued and decided in a previous case, even if the second suit raises different causes of 5 action.” Hardwick v. Cty. of Orange, 980 F.3d 733, 740 (9th Cir. 2020) (citing DKN 6 Holdings LLC v. Faerber, 352 P.3d 387 , 386 (2015)). In other words, it “prevents a party 7 from obtaining a second adjudication of an issue that has already been adjudicated against 8 that party on the merits by a court of competent jurisdiction.” Id. (internal citation and 9 quotation omitted). Issue preclusion applies: “(1) after final adjudication (2) of an identical 10 issue (3) actually litigated and necessarily decided in the first suit and (4) asserted against 11 one who was a party in the first suit or in privity with that party.” Id. (citing DKN Holdings, 12 352 P.3d at 387). “The identical issue requirement addresses whether identical factual 13 allegations are at stake in the two proceedings, not whether the ultimate issues or 14 dispositions are the same.” Id. (internal citation and quotation omitted). 15 Both the 2018 and 2019 Litigations involved the same parties or their privities as are 16 named in the TAC, except that Justin Spencer6 was a named Defendant in the 2019 17 Litigation. The parties litigated the identical issue, i.e., whether claims involving the 18 parties’ work relationship7 were compulsory to the pending Utah Litigation. There has 19 been a final adjudication in the 2018 and 2019 Litigations, as the Ninth Circuit affirmed [21] 5 Utah applies a four-part test to determine whether issue preclusion applies: (1) the issue [22] challenged must be identical in the previous action and in the case at hand; (2) the issue 23 must have been decided in a final judgment on the merits in the previous action; (3) the issue must have been competently, fully, and fairly litigated in the previous action; and (4) [24] the party against whom collateral estoppel is invoked in the current action must have been 25 either a party or privy to a party in the previous action. Macris & Assocs., Inc. v. Neways, Inc., 16 P.3d 1214, 1222 (Utah 2000). 26 6 Justin Spencer is a Utah resident affiliated with HMS. 27 7 Whether Plaintiff was an employee or independent contractor is not relevant in determining whether the claims are identical. Hardwick, 980 F.3d 733 (the factual [28] 1 Judge Lorenz’s dismissals of both cases on the ground that all claims were compulsory to 2 the pending Utah Litigation. The TAC’s first and fifth causes of action (unlawful and 3 unfair business practices and unpaid wages and expenses, respectively) have already been 4 litigated and dismissed in the 2018 Litigation. While the TAC’s second, third, and fourth 5 causes of action (unfair competition, fraud, and false promises, respectively) have not been 6 explicitly raised in the 2018 and 2019 Litigations, these claims involve identical factual 7 allegations at issue in the 2018 and 2019 Litigations, including: Plaintiff was not paid for 8 work; Defendants subjected Plaintiff to sexual harassment during the work relationship; 9 Defendants retaliated against Plaintiff for her complaints; Defendants sabotaged contract 10 negotiations; and Plaintiff received unequal pay to her male counterparts. The Court has 11 already held that dismissal of claims involving these factual allegations is proper because 12 the claims arise from the same transaction or occurrence8 as claims being litigated in the 13 pending Utah Litigation, i.e., the parties’ work relationship. See 2018 Litigation Docket, 14 Docs. 22, 34; 2019 Litigation Docket, Docs. 18, 25; see also Yanaki, 116 P.3d at 963 -65 15 (employee’s discrimination claims were compulsory counterclaims that should have been 16 filed in employer’s earlier-filed action, as employment relationship was the transaction or 17 occurrence that was the subject matter of the employer’s claims). Issue preclusion 18 prohibits relitigation of the compulsory counterclaim issue argued and decided in the 2018 19 and 2019 Litigations, such that the Court will not permit litigation to be maintained on the [21] 22 8 In the 2018 Litigation’s district court dismissal order and the 2019 Litigation’s Ninth 23 Circuit order on appeal, the Court applied Utah law as to the question of whether Plaintiff’s claims are compulsory counterclaims. See 2018 Litigation Docket, Doc. 22; 2019 [24] Litigation Docket, Doc. 25. Accordingly, the Court is inclined to follow Utah law. See 25 Pochiro, 827 F.2d at 1249 ; see also Just in Time Supplier, Inc. v. Sioux Honey Ass’n Coop., 2018 WL 2981179 , at *3 (S.D. Cal. June 14, 2018); Utah R. Civ. P. 13(a)(1) (stating “[a] [26] pleading must state as a counterclaim any claim that—at the time of its service—the 27 pleader has against an opposing party if the claim: (a)(1)(A) arises out of the transaction or occurrence that is the subject matter of the opposing party’s claim; and (a)(1)(B) does not [28] 1 first, second, third, fourth, or fifth causes of action. Hardwick, 980 F.3d at 740 . 2 Accordingly, the Court will now turn to whether Plaintiff’s sixth and seventh causes of 3 action state a claim for relief. 4 ii. Defamation Claim 5 Plaintiff’s sixth cause of action alleges a violation of California Civil Code § 44. 6 (Doc. 127 at 17-18.) California Civil Code § 44 provides that defamation is effected by 7 either libel or slander. Cal. Civ. Code § 44 (West). “Defamation requires the intentional 8 publication of a false statement of fact that has a natural tendency to injure the plaintiff’s 9 reputation or that causes special damage.” Burrill v. Nair, 217 Cal. App. 4th 357 , 383 10 (2013). The elements of a defamation claim include: (1) a publication that is (2) false, (3) 11 defamatory, (4) unprivileged, and (5) has a natural tendency to injure or causes special 12 damage. Wong v. Jing, 189 Cal. App. 4th 1354, 1369 (2010). 13 The TAC alleges that “Defendants directly made statements [that] injured Plaintiff’s 14 business interests, exposed her to ridicule, contempt, shame, and they directly discouraged 15 a business relationship to not associate with Plaintiff.” (Doc. 127 at 17.) The TAC states 16 “Defendants lied to university partners directly harming Plaintiff’s reputation and money 17 earning ability.” (Id.) Other than the foregoing vague and conclusory statements, the 18 complaint fails to describe how Defendants made a defamatory statement, and whether any 19 statements were in fact published. (See Doc. 127 at ¶¶ 11, 24, 54, 56-67). Thus, the Court 20 concludes Plaintiff’s complaint fails to sufficiently plead a cause of action pursuant to 21 California Civil Code § 44. 22 iii. RICO Claim 23 Plaintiff’s seventh cause of action alleges a RICO claim. (Doc. 127 at 18-19.) 24 Defendants contend the RICO claim sounds in fraud, and does not meet the heightened 25 pleading requirements of Federal Rule of Civil Procedure 9(b) such that it must be 26 dismissed. (Doc. 119-1 at 30-31.) 27 Under RICO, it is “unlawful for any person employed by or associated with any 28 enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to 1 conduct or participate, directly or indirectly, in the conduct of such enterprise’s affairs 2 through a pattern of racketeering activity or collection of an unlawful debt.” 18 U.S.C. § 3 1962(c). “To state a claim under § 1962(c), a plaintiff must allege (1) conduct (2) of an 4 enterprise (3) through a pattern (4) of racketeering activity.” Sanford v. MemberWorks, 5 Inc., 625 F.3d 550, 557 (9th Cir. 2010) (citing Odom v. Microsoft Corp., 486 F.3d 541 , 547 6 (9th Cir. 2007) (en banc)). “A ‘pattern’ requires at least two acts of racketeering activity.” [7] 18 U.S.C. § 1961 (5). “‘[R]acketeering activity’ is any act indictable under several 8 provisions of Title 18 of the United States Code, and includes the predicate acts of mail 9 fraud, wire fraud and obstruction of justice.” Sanford, 625 F.3d at 557 (citing Turner v. 10 Cook, 362 F.3d 1219, 1229 (9th Cir. 2004)). 11 The TAC alleges Defendants and one of her business contacts, Mr. Hernandez, and 12 “Jane Doe” acted in concert to defraud Plaintiff. (See Doc. 127 at ¶¶ 7, 70-80.) The TAC 13 states “[t]he 18-month relationship revealed Defendants used tactics such as bribery, 14 conspiracy, theft of Plaintiff’s signature, wire fraud (U.S.C. § 1343) [sic], false promises, 15 fraud, pandering, theft of services, theft by false pretenses, presentation of false/fraudulent 16 claims in Utah, generally fraudulent conduct, and conspiracy to defraud Plaintiff of a lot of 17 money due.” (Id. at ¶ 75.) Plaintiff pleads that, “Defendants conspired with the Universities 18 who engaged in constructive fraud to keep Plaintiff out of CPT Universities that Plaintiff 19 needs.” (Id. at ¶ 74.) 20 Rule 9(b) “requires that, when fraud is alleged, ‘a party must state with particularity 21 the circumstances constituting fraud.’” Kearns v. Ford Motor Co., 567 F.3d 1120 , 1124 22 (9th Cir. 2009) (quoting FED. R. CIV. P. 9(b)). “To avoid dismissal for inadequacy under 23 Rule 9(b), the complaint would need to state the time, place, and specific content of the 24 false representations as well as the identities of the parties to the misrepresentation.” 25 Edwards v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir. 2004) (internal quotation marks 26 omitted). Here, Plaintiff fails to identify any fraud with specificity. Therefore, the RICO 27 claim is dismissed for failure to meet the heightened Rule 9(b) standards. Sanford, 625 28 F.3d at 557 (affirming dismissal of RICO claim, in part, when plaintiff failed to specify 1 any telephone calls subject to the claim of wire fraud). 2 C. Motion for Leave to File Fourth Amended Complaint 3 As outlined above, Plaintiff seeks to add nine new claims and three new Defendants. 4 (Doc. 128.) Defendants oppose Plaintiff’s Motion for Leave arguing Plaintiff is merely 5 attempting to relitigate claims that have already been dismissed or should have been 6 asserted as counterclaims in the Utah Litigation. (Doc. 134 at 12-15.) Defendants contend 7 Plaintiff’s repeated failed complaints show that the defects cannot be cured, and, therefore, 8 any further amendment would be futile. (Id. at 15-16.) Plaintiff replies that “[she] has 9 divisible contracts with equitable remedies [and] . . . has the right to be heard on the merits 10 of her equitable remedies.” (Doc. 143 at 3.) Plaintiff contends the Second Agreement is 11 controlling, despite the Utah Court’s decision ruling that the Third Agreement is the final, 12 binding contract between the parties. (Id. at 3-4.) Finally, Plaintiff contends that her claims 13 should be allowed to proceed in this Court since Utah is not allowing her to assert 14 counterclaims. (Id. at 6, 8.) 15 When determining whether to grant leave to amend, courts generally consider five 16 factors, known as the Foman factors as stated by the Supreme Court in Foman v. Davis, [17] 371 U.S. 178, 182 (1962). These factors include: (1) undue delay; (2) bad faith on the part 18 of the party seeking leave to amend; (3) undue prejudice to the non-moving party; (4) 19 futility of amendment; and (5) whether the plaintiff has previously amended the complaint. [20] Id. The Ninth Circuit has held that “it is the consideration of prejudice to the opposing 21 party that carries the greatest weight.” Eminence Cap., LLC v. Aspeon, Inc., 316 F.3d 1048 , 22 1052 (9th Cir. 2003). “Absent prejudice, or a strong showing of any of the remaining 23 Foman factors, there exists a presumption under Rule 15(a) in favor of granting leave to 24 amend.” Id. (emphasis omitted). In Parents for Privacy v. Barr, 949 F.3d 1210, 1239 (9th 25 Cir. 2020), the Ninth Circuit affirmed a district court’s denial of leave to amend on futility 26 grounds reasoning “[t]he problem with Plaintiffs’ complaint, however, is not the 27 sufficiency of their factual allegations” but “[r]ather . . . Plaintiffs’ legal theories fail.” Id. 28 There, “[a]mending the complaint [would] not change, for example, the extent of the rights 1 that are protected.” Id. 2 Here, Plaintiff originally filed this case on February 19, 2020. (Doc. 1.) Thus, the 3 case has been ongoing for over two years but remains in the pleading stage—despite 4 Plaintiff’s notice that claims in the 2018 and 2019 Litigations were compulsory to the Utah 5 Litigation. This delay is further compounded by the fact that there have been over 232 6 filings in this case to date, many of which include Plaintiff’s action of improperly filing 7 and subsequently withdrawing documents, improperly “supplementing” previous filings, 8 and improperly initiating communications and lodging documents to the undersigned’s 9 efile email address. Further, this is Plaintiff’s fifth attempt to amend the complaint: (1) 10 initial complaint filed February 19, 2020; (2) first amended complaint filed March 6, 2020; 11 (3) second amended complaint filed August 13, 2020, which was subsequently withdrawn 12 by Plaintiff; and (4) third amended complaint filed November 30, 2020. (See Docs. 1, 8, 13 13, 53, 56, 127.) This repeated failure to cure deficiencies by previous amendments, by 14 itself, warrants denial of further leave to amend. Telesaurus VPC, LLC, 623 F.3d at 1003 . 15 Regardless of the title of her claims for relief or the laws under which they are 16 brought, the new defendants and claims Plaintiff seeks to add arise from the business 17 relationship between Plaintiff and HMS and the previous litigations that have been 18 dismissed by Judge Lorenz. All of her new claims arise out of the same transactions, 19 occurrences, and relationship between Plaintiff and Defendants that have been at issue in 20 previous lawsuits. First, the three equitable contract-based claims Plaintiff seeks to add in 21 the fourth amended complaint (i.e., the first, second, and third causes of action) stem from 22 the contractual relationship between Plaintiff and HMS at issue in the 2018 and 2019 23 Litigations. (See Doc. 128-1 at ¶¶ 31, 39, 42-45.) Second, the three new claims based on 24 California state anti-discrimination law (i.e., the eleventh, twelfth, and thirteenth causes of 25 action), rely upon the same factual allegations that were subject to dismissal in the 2019 26 Litigation. (See Doc. 128-1 at 35-38; see also 2019 Litigation Docket, Doc. 25.) Third, 27 Plaintiff’s fourteenth, fifteenth, and sixteenth claims allege actions taken by Defendant 28 HMS in connection with the parties’ business relationship, which would again be 1 compulsory counterclaims to the pending Utah Litigation. (Doc. 128-1 at 25 ¶¶ 197-232); 2 see supra pp. 9-13. In sum, all new claims are duplicative of issues already raised in the 3 2018 and 2019 Litigations. As to all remaining claims in Plaintiff’s fourth amended 4 complaint, they fail for the same reasons as stated above in granting Defendant’s motion 5 to dismiss Plaintiff’s TAC. For the reasons stated above, Plaintiff’s Motion for Leave to 6 File Fourth Amended Complaint is DENIED. In light of the Court’s ruling above, 7 Plaintiff’s Motion for Leave to File Fifth Amended Complaint is DENIED AS MOOT. 8 / / / 9 / / / 10 / / / 11 / / / 12 / / / 13 / / / 14 / / / 15 / / / 16 / / / 17 / / / 18 / / / 19 / / / 20 / / / 21 / / / 22 / / / 23 / / / 24 / / / 25 / / / 26 / / / 27 / / / 28 / / / I IV. CONCLUSION 2 For the reasons above: 3 1. Plaintiff's Motion to File Supplemental Authority (Doc. 193) is GRANTED. 4 2. Defendants’ Motion to Dismiss (Doc. 119) is GRANTED, and □□□□□□□□□□□ 5 claims are dismissed WITH PREJUDICE. 6 3. Plaintiffs Motion for Leave to File Fourth Amended Complaint (Doc. 128) is 7 DENIED. 8 4. Plaintiff's Motion for Leave to File Fifth Amended Complaint (Doc. 212) is 9 DENIED AS MOOT. 10 5. Plaintiff's Motion for Special Master (Doc. 192) is DENIED. 11 6. The Clerk of Court is INSTRUCTED to not accept any further filings, except 12 a motion for reconsideration or notice of appeal. Accordingly, the Parties are 13 CAUTIONED that no further filings will be accepted in this case, except a 14 motion for reconsideration or notice of appeal. The Court takes Defendants’ 15 motion for relief from vexatious litigant (Doc. 228) under submission and will 16 issue an order in due course. Supplemental briefing on the motion for 17 vexatious litigant may not be filed without leave of Court, unless there is a 18 subsequent change in binding law that is directly on point. See Montenegro 19 Civil Chamber Rules, Section III(D). 20 IT IS SO ORDERED. 21 |} DATE: November 25, 2022 a tn 3 HONY RUTH BERMUBEZ ‘MONTENEGRO UNITED STATES DISTRICT JUDGE