De Castro v. Castro

Maria Luisa Iglesias De Castro,Maria Irene Castro Iglesias,Maria de la Concepcion Castro Iglesias,and Maria Luisa Castro Iglesias, Plaintiffs, v. Maria Regina Castro, andPedro Jose Caraballo, Defendants.

Civil No. 18-1449 (DWF/ECW)

UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA

November 16, 2018

MEMORANDUM OPINION AND ORDER

Tiffany A. Blofield, Esq., and Carl Richard Hansen, Esq., Winthrop & Weinstine, counsel for Plaintiffs.

Dustin Collen Jones, Esq., and Ken D. Schueler, Esq., Dunlap & Seeger, P.A., counsel for Defendants.

INTRODUCTION

This matter is before the Court on Defendants' motion to dismiss Plaintiffs' Complaint pursuant to Fed. R. Civ. P. 8(a)(2), alternatively, for dismissal of counts I, II, and III under Fed. R. Civ. P. 12(b)(6), or, in the alternative, for judgment on the pleadings of all counts under Fed. R. Civ. P. 12(c). (Doc. No. 9.) Plaintiffs allege civil theft (Counts I and II), conversion (Count III), and unjust enrichment (Count IV) to recover monies allegedly stolen from them by family members. (Doc. No. 1 ("Compl.") ¶¶ 64-80.) For the reasons set forth below, the Court denies Defendants' motion.

BACKGROUND

Plaintiff Maria Luisa Iglesias De Castro ("Maria Iglesias") is the mother of Plaintiffs Maria Irene Castro Iglesias ("Maria Irene"), Maria de la Concepcion Castro ("Maria de la Concepcion"), and Maria Luisa Castro Iglesias ("Maria Luisa") (collectively, "Plaintiffs"). (Compl. ¶ 13.) The Plaintiffs currently reside in Venezuela. (Id. ¶¶ 4-7.)

Maria Iglesias is the widow of Emilio Castro Sanjurjo ("Emilio"). (Id. ¶ 13.) During Emilio's lifetime, he operated a business partnership ("Partnership") in Venezuela with his brother, Vicente Castro Sanjurjo ("Vicente"). (Id. ¶ 15.) The Partnership ran several construction companies and co-owned real estate in Venezuela and Spain. (Id. ¶ 16.) The brothers jointly owned all partnership assets, divided business profits evenly, and maintained a partnership bank account in both of their names.¹ (Id. ¶¶ 17-18.) Emilio's share of the Partnership's profits served as Plaintiffs' sole source of financial support. (Id. ¶ 19.) Plaintiffs allege that in the event of Emilio's death, his share of Partnership assets and ongoing profits would go to Maria Iglesias to ensure her financial well-being. (Id. ¶ 20.)

Emilio died on July 27, 1991 with Plaintiffs as his heirs. (Id. ¶¶ 21-22.) Plaintiffs allege that at Emilio's deathbed, Vicente vowed to care and provide for Maria Iglesias in Emilio's absence. (Id. ¶ 23.) To this end, Plaintiffs executed a power of attorney to grantVicente the authority to administer Emilio's estate and Partnership businesses.² (Id. ¶ 24). Vicente continued to manage and operate the Partnership and provided Maria Iglesias with financial support that was purportedly drawn from her share of its profits. (Id. ¶ 33.) This support routinely included money sufficient to cover: (1) living expenses; (2) health insurance; and (3) a small weekly allowance for food and for medical expenses not covered by insurance. (Id. ¶ 34.) Plaintiffs allege that when they inquired as to the amount and extent of support, Vicente told them that Maria Iglesias was receiving her full share and that the Partnership profits were insufficient to provide any additional money.³ (Id. ¶¶ 36, 49-53.)

Plaintiffs further allege that additional Partnership profits did exist but that Vicente and Defendants Maria Regina Castro ("Maria Regina") and Pedro Jose Caraballo ("Pedro Jose") (collectively "Defendants") engaged in a secretive, multi-year scheme to steal and misappropriate both Maria Iglesias' share of the profits and the money Emilio left for Maria Iglesias and her daughters.⁴ (Id. ¶ 37.) Specially, Plaintiffs allege that after Emilio died, Vicente and Maria Regina deposited money stolen from Maria Iglesias intomoney market accounts in the United States that were opened in the names of Vicente, Maria Regina, and Pedro Jose. (Id. ¶ 38.) Plaintiffs allege that between 1992 and 2001, Vicente and Maria Regina distributed the money market funds to themselves. (Id. ¶ 39.)

Plaintiffs also allege that Vicente issued Defendants a number of checks totaling approximately $88,000 drawn from funds belonging to Plaintiffs. (Id. ¶ 40.) Plaintiffs allege that Defendants knowingly deposited the stolen funds into United Sates bank accounts and spent them. (Id. ¶¶ 40-41.) Plaintiffs further allege that between 1995 and 2002, Vicente assisted Defendants to transfer the entire $150,000 balance of Maria Iglesias' bank account into their own joint bank account in the United States. (Id. ¶ 45, Ex. A.) To accomplish this, Plaintiffs allege that Defendants and Vicente opened and closed a number of bank accounts in the United States and conducted over 7,000 transactions to transfer money between them. (Id. ¶ 45.)

Plaintiffs became aware of the alleged misappropriation in 2015. (Id. ¶ 54). At that time, Plaintiffs obtained access to records and accounts related to jointly owned real estate and Maria Iglesias' share of the Partnership's profits. (Id. ¶ 59.) A forensic review of these records revealed the alleged theft and misappropriation described above. (Id. ¶ 60.)

DISCUSSION

Defendants move to dismiss Plaintiffs' Complaint in its entirety for failure to meet the pleading standard pursuant to Fed. R. Civ. P. 8(a)(2). Alternatively, Defendants move to dismiss counts I, II, and III under Rule 12(b)(6) for failure to state a claim uponwhich relief can be granted. In the alternative, Defendants move for judgment on the pleadings for all counts pursuant to Rule 12(c).

I. Dismissal Pursuant to Rule 8(a)(2)

A. Legal Standard

To survive a motion to dismiss pursuant to Rule 8(a)(2), a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). The pleading standard articulated by Rule 8 "does not require detailed factual allegations, but it [does demand] more than an unadorned, the-defendant-unlawfully-harmed-me-accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks and citations omitted). A "pleading that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do.'" Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Thus, to "survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Id. (quoting Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. at 678 (citing Twombly, 550 U.S. at 556). "Determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Iqbal, 556 U.S. at 679.

B. Analysis

Defendants argue that Plaintiffs' Complaint should be dismissed in its entirety because Plaintiffs fail to allege any factual content as to how and why each individual plaintiff is entitled to relief. (Doc. No. 11 ("Def.'s Memo") at 2, 4.) They argue that the allegations in Plaintiffs' Complaint are conclusory statements that fail to create a reasonable inference that Plaintiffs have a legally recognized property interest in the profits, assets, funds, or proceeds from the Partnership. (Id. at 6, 8.) The Court disagrees.

Plaintiffs plainly state that they are Emilio's heirs. (Compl. ¶ 22.) They also plead, "[i]n the event of Emilio's death, his share of the partnership assets and ongoing profits would go to Plaintiff Maria Luisa Iglesias (mother) to ensure her financial well-being." (Compl. ¶ 20.) Plaintiffs further allege that "between 1995 and 2002, Defendant Maria Regina and Defendant Caballo, with Vicente's assistance, gradually transferred the entire $150,000 balance of a bank account maintained in Plaintiff Maria Luisa Iglesias's (mother) name into their own joint bank account in the United States." (Compl. ¶ 44.) Based on judicial experience and common sense, the Court draws a reasonable inference that Plaintiffs have a legally recognized interest in the contested assets and finds that they have stated a plausible claim for relief as it relates to all four counts of their Complaint. Iqbal, 556 U.S. at 679.

Defendants further ague that even if Plaintiffs have a legally recognized interest in the Partnership assets, Count II fails because Plaintiffs fail to allege that Defendants actedwith "felonious intent to steal" as required to recover under Florida's civil theft statute.^{5 6} (Def.'s Memo. at 9.) The Court is unpersuaded. "Felonious intent" is clearly implied by the nature of Plaintiffs allegations that Defendants unlawfully misappropriated and stole funds. (Compl. ¶¶ 3, 37, 38, 39, 0, 41, 44, 45, 60.)

The Court finds that Plaintiffs' Complaint includes sufficient facts to state a facially plausible claim to relief and denies Defendants' motion to dismiss pursuant to Rule 8(a)(2).

II. Dismissal of Counts I, II, and III pursuant to Rule 12(b)(6)

A. Legal Standard

In deciding a motion to dismiss pursuant to Rule 12(b)(6), a court assumes all facts in the complaint to be true and construes all reasonable inferences from those facts in the light most favorable to the complainant. Morton v. Becker, 793 F.2d 185, 187 (8th Cir. 1986). In doing so, however, a court need not accept as true wholly conclusory allegations, Hanten v. Sch. Dist. of Riverview Gardens, 183 F.3d 799, 805 (8th Cir. 1999), or legal conclusions drawn by the pleader from the facts alleged, Westcott v. City of Omaha, 901 F.2d 1486, 1488 (8th Cir. 1990). A court may consider the complaint, matters of public record, orders, materials embraced by the complaint, and exhibitsattached to the complaint in deciding a motion to dismiss under Rule 12(b)(6). See Porous Media Corp. v. Pall Corp., ...