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Wells Fargo Bank, N.A. v. Klosterman

United States District Court, D. Hawaii

November 15, 2017

WELLS FARGO BANK, N.A., Plaintiff,
v.
MARIANNE KLOSTERMAN; KLAUS P. KLOSTERMAN; GALAXY AQUATICS, INC.; JOHN DOES 1-10; JANE DOES 1-10; DOE CORPORATIONS 1-10; DOE PARTNERSHIPS 1-10; DOE ASSOCIATIONS 1-10; DOE GOVERNMENTAL UNITS 1-10; and DOE ENTITIES 1-10, Defendants.

          ORDER GRANTING THE KLOSTERMAN DEFENDANT'S SECOND MOTION TO DISMISS THE FIRST AMENDED COMPLAINT

          Alan C. Kay Sr. United States District Judge

         For the reasons set forth below, the Court GRANTS the Klosterman Defendants' Second Motion to Dismiss, ECF No. 18.

         The Court dismisses Counts 1 and 2 as to the Klosterman Defendants in the FAC WITHOUT PREJUDICE.

         FACTUAL BACKGROUND

         On approximately July 11, 2003, Defendants Marianne Klosterman and Klaus P. Klosterman (“Klosterman Defendants”), on behalf of Galaxy Aquatics, Inc. (“Galaxy” and together with the Klosterman Defendants, “Defendants”), applied for a business loan line of credit (the “Application”) with Wells Fargo Bank, N.A. (“Wells Fargo” or “Plaintiff”). First Amended Complaint (“FAC”) ¶ 8. Within the Application, there was a section entitled “Agreement and Personal Guarantee” in which the Klosterman Defendants agreed to “jointly and severally unconditionally guarantee and promise to pay [Wells Fargo] all indebtedness of [Galaxy] at any time arising under or relating to any credit requested through this application, as well as any extensions, increases or renewals of that indebtedness.” Id. ¶¶ 10-11.

         Wells Fargo tendered performance according to the Application by advancing funds to Galaxy. Id. ¶ 13. On approximately November 4, 2013, Galaxy defaulted by failing to make the required payment due under its business line of credit account. Id. ¶ 14.

         On approximately August 14, 2014, Wells Fargo made separate demands of Galaxy and each of the Klosterman Defendants to make full payment of the amount due under the business line of credit account. Id. ¶ 17. Despite these demands, Defendants have failed to pay such sums. Id. ¶ 18. Currently, the amount due is $75, 679.34. Id. ¶ 16.

         PROCEDURAL BACKGROUND

         On July 20, 2017, Plaintiff filed its Complaint against Defendants alleging claims for breach of contract and quantum meruit. ECF No. 1. On August 16, 2017, the Klosterman Defendants filed a Motion to Dismiss for Failure to State a Claim. ECF No. 14. On September 6, 2017, in response to the Motion to Dismiss, Plaintiff filed the FAC, which also alleges claims for breach of contract and quantum meruit. ECF No. 16.

         On September 20, 2017, the Klosterman Defendants filed a Second Motion to Dismiss for Failure to State a Claim Against Defendants Marianne and Klaus P. Klosterman (“Motion”). ECF No. 18. On October 6, 2017, Plaintiff filed an Opposition to the Motion. ECF No. 21. On October 16, 2017, the Klosterman Defendants filed a Reply. ECF No. 25.[1] The Court held a hearing on the Motion on October 30, 2017.

         STANDARD

         Federal Rule of Civil Procedure 12(b)(6) authorizes the Court to dismiss a complaint that fails “to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). Rule 12(b)(6) is read in conjunction with Rule 8(a), which requires only “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). The Court may dismiss a complaint either because it lacks a cognizable legal theory or because it lacks sufficient factual allegations to support a cognizable legal theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988).

         In resolving a Rule 12(b)(6) motion, the Court must construe the complaint in the light most favorable to the plaintiff and accept all well-pleaded factual allegations as true. Sateriale v. R.J. Reynolds Tobacco Co., 697 F.3d 777, 783 (9th Cir. 2012). The complaint “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “The plausibility standard . . . asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. “Where a complaint pleads facts that are ‘merely consistent with' a defendant's liability, it ‘stops short of the line between possibility and plausibility of entitlement to relief.'” Id. (quoting Twombly, 550 U.S. at 557).

         When the Court dismisses a complaint pursuant to Rule 12(b)(6) it should grant leave to amend unless the pleading cannot be cured by new factual allegations. OSU ...


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