Maye v. Online Land Sales LLC

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DIMITRI MAYE, Plaintiff, v. ONLINE LAND SALES LLC, et al., Defendant.

No. 2:23-cv-00173-DAD-CKD

United States District Court, E.D. California

January 31, 2024

FINDINGS AND RECOMMENDATIONS

CAROLYN K. DELANEY, UNITED STATES MAGISTRATE JUDGE

Plaintiff Dimitri Maye, filed this federal question and diversity jurisdiction action pursuant to 28 U.S.C. § 1331 and 28 U.S.C. § 1367. Plaintiff seeks damages, restitution, and injunctive relief under the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C §§ 1961 et seq., and the laws of the State of California.

In the motion presently before the court, defendants Scott Wigginton (sued as Wiggington) and Classic Country Land LLC move under Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss plaintiff's claims against them. (ECF No. 14.) On October 5, 2023, the presiding district judge referred this matter to the undersigned for the purpose of these findings and recommendations. (ECF No. 18.) See 28 U.S.C § 636(b)(1). For the reasons set forth below, the undersigned recommends the court grant, in part, the moving defendants' motion under Rule 12(b)(6) and dismiss plaintiff's first, second, third, and fourth causes of action against them, with leave to amend.

ALLEGATIONS IN THE COMPLAINT

Plaintiff filed the complaint on March 17, 2021. (ECF No. 1.) Plaintiff alleges the four defendants, Online Land Sales LLC, Brian Quilty, Scott Wigginton, and Classic Country Land LLC, “work in concert to sell inaccessible land through contract-for-deed schemes across the country.” (Id., ¶ 55.) The allegations in this section are taken from the complaint. For purposes of this motion, the well-pleaded factual allegations are assumed to be true.

Plaintiff is the owner of a vacant and undeveloped lot of land in Lassen County, California (“Subject Property”), which he purchased from defendant, Online Land Sales LLC (“OLS”). (ECF No. 1, ¶¶ 12-15.) The property is accessible only by a sixty-foot (60), four-wheel-drive dirt trail of Chicken Ranch Road (hereinafter “easement”). (ECF No. 1, ¶ 21.)

Plaintiff and OLS contracted for plaintiff's purchase of the land on February 28, 2018, for the purchase price of $55,000. (ECF No. 1, ¶ 15.) The contract states the land comes “with all rights of ownership associated with the property, including, but not limited to, all easements and rights benefiting the premises, whether or not such easements and rights are of record....” (Id., ¶ 36.) The contract provides for immediate access to the land upon execution. (Id., ¶ 19.)

On or about June 12, 2018, defendant OLS provided plaintiff with a copy of a contract-for-deed agreement it had with defendant, Classic Country Land LLC (“CCL”), for the subject property. (ECF No. 1 at 5.)

On or before June 18, 2018, plaintiff attempted to access the Subject Property and found a locked gate across the easement barring access. (ECF No. 1, ¶ 21.) Plaintiff requested access to the easement to reach the Subject Property but was denied access to the property because his name was not on the deed. (Id., ¶ 24.)

Plaintiff inquired at the County Recorder's Office and discovered that on or about June 24, 2010, Johnetta Ford, an unrelated third party, had recorded a contract-for-deed contract with defendant Wigginton for which she had not filed a transfer or quitclaim deed. (ECF No. 1, ¶ 25.) Plaintiff alleges Ms. Ford entered into two such contracts for the Subject Property and defaulted both times. (Id., ¶ 29.)

Ms. Ford recorded a quitclaim deed on or about June 25, 2018. (ECF No. 1, ¶ 26.) Prior to Ms. Ford's signing of the quitclaim deed, plaintiff called defendant Wigginton, who assured plaintiff the property had easement access. (Id., ¶ 31.) Plaintiff also sent email correspondence regarding this issue to defendant Quilty, who responded using a general email account for OLS. (Id., 32.)

On July 11, 2018, defendant CCL, through its employee Lori Murphy, advised plaintiff and defendant OLS that the 60-foot road that leads from Chicken Ranch Road to plaintiff's parcel was “a public road.” (ECF No. 1, ¶ 33.) On or about July 16, 2018, defendant OLS, through its employee Eileen Sunga, told plaintiff the property could be “accessed via a small 4WD dirt trail off of Chicken Ranch Road. There is also a 60 ft. legal recorded easement in place....” (Id., ¶ 34.)

Plaintiff began developing prospects for commercial farming. (ECF No. 1, ¶ 37.) The United States Department of Agriculture (“USDA”) would not contract with plaintiff until he had guaranteed access to the property. (Id.)

Plaintiff's contract-for-deed with OLS did not provide him legitimate access or rights to the property because defendant OLS was not on title and defendant Wigginton was the record owner. (ECF No. 1, ¶¶ 38, 44.) OLS represented that it had an ownership interest in the Subject Property based on its contract-for-deed agreement with CCL, but neither OLS nor CCL had an ownership interest in the Subject Property. (Id., ¶ 44.)

In or about March 2019, plaintiff contacted employees of defendants OLS and CCL and unsuccessfully tried to obtain a lease agreement signed by defendant Wigginton, whose name was on title. (ECF No. 1, ¶¶ 38-41.) Defendant CCL's employee, Lori Murphy, stated if plaintiff paid off the property, then defendant Wigginton would ensure plaintiff had access to the property. (Id., ¶ 41.) CCL, its employees, and Wigginton then refused to communicate further with plaintiff on the ground that his contract was with defendant OLS. (Id., ¶ 43.) On multiple occasions, plaintiff sent inquiries about land access to defendant OLS, who would forward the inquiries to defendant CCL and then reply to plaintiff. (Id.)

Neither OLS nor CCL ever told plaintiff the Subject Property lacked easement access. (ECF No. 1, ¶ 45.) Both acted in concert to make plaintiff believe that if he paid off the land, he would gain access via the easement. (Id.)

In an effort to gain access to the land, plaintiff paid off the land in or about May 2021. (ECF No. 1, ¶ 46.) The contract provides both that a deed is to be provided to purchaser “upon total payment of the purchase price” and that time is of the essence “in the performance for each and every term” in the contract. (Id.)

On July 17, 2021, defendant Quilty signed a warranty deed transferring title of the property from defendant OLS to plaintiff. (ECF No. 1, ¶ 47.) However, defendant Wigginton did not sign a deed transferring a deed to defendant OLS until August 2, 2021. (Id.) The deed transferring the Subject Property from defendant Wigginton to defendant OLS was recorded on August 9, 2021, and the deed transferring the Subject Property from OLS to plaintiff was recorded on August 16, 2021. (Id.)

When plaintiff received his deed and again attempted to access the property, he was denied access because there is no right for the owner of the Subject Property to access the easement. (ECF No. 1, ¶ 49.) Plaintiff tried unsuccessfully to obtain an easement through other routes. (Id., ¶ 52.) Defendants have refused to give plaintiff any information about the basis for their statements that an easement exists. (Id., ¶ 53.)

Plaintiff asserts five causes of action against all defendants: (1) a civil violation of Racketeer Influenced and Corrupt Organizations (“RICO”) (Count One); (2) intentional misrepresentation (Count Two); (3) fraudulent concealment (Count Three); (4) conversion (Count Four); and (5) unfair business practices (Count Five). (ECF No. 1 at ¶¶ 56-24.)

On May 8, 2023, defendant Wigginton and defendant CCL (“CCL defendants”) filed the motion to dismiss presently before the court. (ECF No. 14.) Plaintiff's opposition to the motion (ECF No. 16) and defendants' reply (ECF No. 17) are also before the court. On October 5, 2023, the presiding district judge referred this matter to the undersigned for the purpose of these findings and recommendations. (ECF No. 18.)

LEGAL STANDARD

The purpose of a motion to dismiss pursuant to Rule 12(b)(6) is to test the legal sufficiency of the complaint. N. Star Int'l v. Ariz. Corp. Comm'n, 720 F.2d 578, 581 (9th Cir. 1983). In ruling on such a motion, the court may consider material that is properly submitted as part of the complaint, documents that are not physically attached to the complaint where their authenticity is not contested and the plaintiffs' complaint necessarily relies on them, and matters of public record. Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001).

“Dismissal can be based on the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). A plaintiff is required to allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). “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.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

In determining whether a complaint states a claim on which relief may be granted, the court accepts as true the allegations in the complaint and construes the allegations in the light most favorable to the plaintiff. Hishon v. King & Spalding, 467 U.S. 69, 73 (1984); Love v United States, 915 F.2d 1242, 1245 (9th Cir. 1989), abrogated on other grounds by DaVinci Aircraft, Inc. v. United States, 926 F.3d 1117 (9th Cir. 2019). However, the court need not assume the truth of legal conclusions cast in the form of factual allegations. U.S. ex rel. Chunie v. Ringrose, 788 F.2d 638, 643 n.2 (9th Cir. 1986). While Rule 8(a) does not require detailed factual allegations, ...