cheryl a. williams (cal. bar no. 193532) williams ...case no.: 17-cv -01436 gpc msb opp’n to...

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Case No.: 17-CV-01436 GPC MSB

OPP’N TO ROSETTE DEFS.’ MOT. TO DISMISS & STRIKE

Cheryl A. Williams (Cal. Bar No. 193532) Kevin M. Cochrane (Cal. Bar No. 255266) [email protected] [email protected] WILLIAMS & COCHRANE, LLP 125 S. Highway 101 Solana Beach, CA 92075 Telephone: (619) 793-4809 Attorneys for Plaintiffs WILLIAMS & COCHRANE, LLP, et al.

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF CALIFORNIA

WILLIAMS & COCHRANE, LLP;

vs.

ROBERT ROSETTE; ROSETTE &

ASSOCIATES, PC; ROSETTE, LLP; RICHARD ARMSTRONG; QUECHAN TRIBE OF THE FORT

YUMA INDIAN RESERVATION, a

federally-recognized Indian tribe; and

DOES 1 TO 100. ___________________________

FRANCISCO AGUILAR, MILO

BARLEY, GLORIA COSTA, GEORGE DECORSE, SALLY

DECORSE, et al., on behalf of themselves

and all those similarly situated;

vs.

ROBERT ROSETTE; ROSETTE &

ASSOCIATES, PC; RICHARD

ARMSTRONG; and DOES 1 TO 100.

Case No.: 17-CV-01436 GPC MSB PLAINTIFFS’ OPPOSITION TO ROSETTE DEFENDANTS’ MOTION TO DISMISS AND STRIKE PLAINTIFFS’ FOURTH AND FIFTH CLAIMS FOR RELIEF PURSUANT TO FEDERAL RULES OF CIVIL PROCEDURE 12(b)(1), 12(b)(6), AND 12(f) [DKT. NO. 185] Date: April 5, 2019 Time: 1:30 p.m. Dept: 2D Judge: The Honorable Gonzalo P. Curiel

Case 3:17-cv-01436-GPC-MSB Document 193 Filed 01/28/19 PageID.13124 of 34

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i Case No.: 17-CV-01436 GPC MSB


TABLE OF CONTENTS

INTRODUCTION………………………………………………………………………… 1 LEGAL STANDARD …………………………………………………………………….. 5 ARGUMENT ……………………………………………………………………………. 6

I. PLAINTIFFS’ AMENDMENTS DO NOT EXCEED THE SCOPE OF THE COURT’S LEAVE TO AMEND ………………………………………… 6

II. THE THIRD AMENDED COMPLAINT DOES NOT VIOLATE THE COURT’S PRIOR ORDER AND DOES NOT ADD DEROGATORY ALLEGATIONS THAT SHOULD ALSO BE STRUCK UNDER RULE 12(F) ……………………………………………………………………. 10

III. THE THIRD AMENDED COMPLAINT ALLEGES AT LEAST FIVE CONCRETE INJURIES PROXIMATELY CAUSED BY THE ALLEGED RICO SCHEME …………………………………………………………. 15

IV. THE THIRD AMENDED COMPLAINT ALLEGES A PLETHORA OF RICO PREDICATE ACTS FOR THE CONSPIRACY AND/OR SCHEME ………. 18 A. WEBSITE ADVERTISEMENT ………………………………………….. 18

B. PROMOTIONAL MATERIALS …………………………………………. 20

C. QUECHAN …………………………………………………………… 20

D. LA PENA LAW ………………………………………………………. 21

E. JUNE 26 & JUNE 30, 2017 TERMINATION LETTERS AT QUE- CHAN ………………………………………………………………... 22

F. APRIL 28, 2018 THREAT TO THE ATTORNEYS OF WILLIAMS & COCHRANE ……………………………………………………….. 23

G. NOVEMBER 1, 2018 PRESS RELEASE ON LA PENA LAW ……………... 23

///


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ii Case No.: 17-CV-01436 GPC MSB


V. THE ANCILLARY ARGUMENTS RAISED WITHIN THE ROSETTE

DEFENDANTS’ MOTION TO DISMISS ABOUT NARROWING THE

ENTERPRISE AND SKIRTING AROUND INTRA-TRIBAL AFFAIRS

ARE MERITLESS ………………………………………………………… 24

CONCLUSION …………………………………………………………………………. 25


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iii Case No.: 17-CV-01436 GPC MSB


TABLE OF AUTHORITIES

CASES

Allen v. County of L.A. Sheriff’s Dep’t,

2009 U.S. Dist. Lexis 133613 (C.D. Cal. 2009) ……………………………….. 6

Allstate Ins. Co. v. Yehudian,

2018 U.S. Dist. Lexis 27129 (E.D.N.Y. 2018) ………………………………… 6

Anza v. Ideal Steel Supply Corp.,

547 U.S. 451 (2006) …………………………………………………………… 3

Beshwate v. BMW of N. Am.,

2017 U.S. Dist. Lexis 164820 (E.D. Cal. 2017) ……………………………….. 7

Bridge v. Phoenix Bond & Indem. Co.,

553 U.S. 639 (2008) …………………………………………………….. 3, 4, 21

Bryant v. Mattel,

573 F. Supp. 2d 1254 (C.D. Cal. 2007) ……………………………………. 2, 22

Campos v. Failla,

2016 U.S. Dist. Lexis 42745 (S.D. Cal. 2016) ……………………………….. 10

C&M Café v. Kinetic Farm, Inc.,

2016 U.S. Dist. Lexis 161262 (N.D. Cal. 2016) ……………………………... 19

Canyon County v. Syngeta Seeds, Inc.,

519 F.3d 969 (9th Cir. 2008) …………………………………………………. 17

Cohen v. Trump,


Commercial Cleaning Servs. v. Colin Serv. Sys., Inc.,

271 F.3d 374 (2d Cir. 2001) …………………………………………………… 4

Community Dev. Comm’n v. Asaro,

212 Cal. App. 3d 1297 (4th Dist. 1989) ……………………………………… 18

///


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iv Case No.: 17-CV-01436 GPC MSB


Diaz v. Gates,

420 F.3d 897 (9th Cir. 2005) …………………………………………... 4, 17, 19

Fantasy, Inc. v. Fogerty,

984 F.2d 1524 (9th Cir. 1993) ………………………………………………... 11

Gateway Bottling, Inc. v. Dad’s Rootbear Co.,

53 F.R.D. 585 (W.D. Pa. 1971) ………………………………………………. 12

GMC v. Ignacio Lopez de Arriortua,

948 F. Supp. 670 (E.D. Mich. 1996) …………………………………………. 16

Guerrero v. Gates,

442 F.3d 697 (9th Cir. 2006) …………………………………………………. 17

Hellman Worldwide Logistics, Inc. v. Harris,

2009 U.S. Dist. Lexis 123250 (W.D. Wash. 2009) ……………………………. 6

In re GlenFed, Inc. Securities Litig.,

42 F.3d 1541 (9th Cir. 1994) …………………………………………………... 6

In re Chrysler-Dodge-Jeep EcoDiesel Mktg., Sales Practices & Prods. Liab. Litig.,

295 F. Supp. 3d 927 (N.D. Cal. 2018) ………………………………………... 17

In re Volkswagen “Clean Diesel” Mktg., Sales Practices, & Prods. Liab. Litig.,

2018 U.S. Dist. Lexis 171598 (N.D. Cal. 2018) ……………………………... 17

J & M Turner v. Applied Bolting Tech. Prods.,

1997 U.S. Dist. Lexis 1835 (E.D. Pa. 1997) …………………………………. 23

Jenkins v. County of Riverside,

398 F.3d 1093 (9th Cir. 2005) …………………………………………………. 5

Just Film, Inc. v. Buono,

847 F.3d 1108 (9th Cir. 2017) ……………………………………………. 16, 17

Knevelbaard Dairies v. Kraft Foods, Inc.,

232 F.3d 979 (9th Cir. 2000) …………………………………………………... 3

Lambuba Corp. v. City of Oakland,

2006 U.S. Dist. Lexis 82193 (N.D. Cal. 2006) ………………………………... 6


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v Case No.: 17-CV-01436 GPC MSB


Lancaster Cmty. Hosp. v. Antelope Valley Hosp. Dist.,

940 F.2d 397 (9th Cir. 1991) …………………………………………………... 5

Lilley v. Charren,

936 F. Supp. 708 (N.D. Cal. 1996) …………………………………………… 11

Little v. Gore,

188 F. Supp. 3d 1005 (S.D. Cal. 2016) ………………………………………. 10

Lowe v. Eltan B.V.,

2006 U.S. Dist. Lexis 97687 (E.D. Tex. 2006) ………………………. 16, 19, 20

Malley-Duff & Assoc. Inc. v. Crown Life Ins. Co.,

792 F.2d 341 (3d Cir. 1986) ………………………………………………….. 23

McLaughlin v. Anderson,

962 F.2d 187 (2d Cir. 1992) …………………………………………………… 5

Mendoza v. Zirkle Fruit Co.,

301 F.3d 1163 (9th Cir. 2002) ………………………………... 3, 4, 9, 15, 17, 21

Miccosukee Tribe of Indians of Fla. v. Cypress,

814 F.3d 1202 (11th Cir. 2015) ………………………………………………. 25

Neilson v. Union Bank of Cal., N.A.,

290 F. Supp. 2d 1101 (C.D. Cal. 2003) ………………………………………. 11

NOW v. Scheidler,

510 U.S. 249 (1994) ………………………………………………………….. 16

Osgood v. Main Street Mktg., LLC,

2017 U.S. Dist. Lexis 5625 (S.D. Cal. 2017) …………………………….. 12, 13

Ouwinga v. Benistar 419 Plan Servs.,

694 F.3d 783 (6th Cir. 2012) …………………………………………………. 14

People v. Fisher,

216 Cal. App. 4th 212 (3d Dist. 2013) ……………………………………….. 17

Planned Parenthood v. Am. Coal. of Life Activists,

945 F. Supp. 1355 (D. Or. 1996) ………………………………………... 5, 6, 16


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vi Case No.: 17-CV-01436 GPC MSB


Planned Parenthood Fed’n of Am., Inc. v. Ctr. for Med. Progress,

214 F. Supp. 3d 808 (N.D. Cal. 2016) ………………………………………... 16

Prime Healthcare Servs. v. Serv. Employees Int’l Union,

147 F. Supp. 3d 1094 (S.D. Cal. 2015) ………………………………………. 22

Rehkop v. Berwick Healthcare Corp.,

95 F.3d 285 (3d Cir. 1996) ………………………………………………….. 5, 9

Religious Techs. Ctr. v. Wollersheim,

796 F.2d 1076 (9th Cir. 1986) ………………………………………………... 16

Salas v. Int’l Union of Operating Eng’rs,

2015 U.S. Dist. Lexis 20077 (C.D. Cal. 2015) ……………………………….... 5

Sapiro v. Encompass Inst.,

221 F.R.D. 513 (N.D. Cal. 2004) …………………………………………… 6, 7

Sedima S.P.R.L. v. Imrex Co.,

473 U.S. 479 (1985) ……………………………………………………….. 3, 16

Sidney-Vinstein v. A.H. Robins Co.,

697 F.2d 880 (9th Cir. 1983) …………………………………………………. 11

Slade v. Gates,

2002 U.S. Dist. Lexis 20988 (C.D. Cal. 2002) ………………………………… 5

United States v. 729,773 Acres of Land,

531 F. Supp. 967 (D. Haw. 1982) …………………………………………….. 11

United States v. Diaz,

649 F. App’x 373 (9th Cir. 2016) …………………………………………….. 24

Walters v. Fidelity Mortg. of Cal.,

730 F. Supp. 2d 1185 (E.D. Cal. 2010) ………………………………………. 11

Williams & Cochrane, LLP v. Quechan Tribe of Fort Yuma Indian Reservation,


Willie McCormick & Assocs. v. Lakeshore Eng’g Servs.,

2015 U.S. Dist. Lexis 114365 (E.D. Mich. 2015) ………………………... 15, 16


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vii Case No.: 17-CV-01436 GPC MSB


Xcentric Ventures, LLC v. Borodkin,

798 F.3d 1201 (9th Cir. 2015) ………………………………………………... 16

STATUTES

Hobbs Act (18 U.S.C. § 1951) generally …………………………………………………………………… 2, 22 Racketeer Influenced and Corrupt Organizations Act (18 U.S.C. § 1961 et seq.) generally …………………………………………………………………. passim 1961(1) …………………………………………………………………… 22, 23 1964(c) …………………………………………………………………………. 4 Telephone Consumer Protection Act (47 U.S.C. § 227) generally ……………………………………………………………………… 12 California Business and Professions Code § 17500 ……………………………………………………………………….. 18 RULES AND REGULATIONS

Federal Rules of Civil Procedure 8(a) …………………………………………………………………………... 5, 6 9(b) …………………………………………………………………… 2, 5, 6, 22 12 ………………………………………………………………………………. 6 12(b)(6) ……………………………………………………………………….. 16 12(f) ……………………………………………………………………. 6, 10, 11 56 ……………………………………………………………………………... 16 SECONDARY SOURCES

Federal Register 83/4235 ……………………………………………………………………….. 14


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1 Case No.: 17-CV-01436 GPC MSB


INTRODUCTION

Patterns appear in infinite varieties in this wonderful world. They exist in nature at

both the microscopic and macroscopic levels in everything from fractal frost to the mud-

cracks in a dry creek bed, respectively:

As with nature, one can also find patterns in the creations of man, like the exterior of the

United Steelworkers of America building in downtown Pittsburg:

These man-made patterns exist in this case as well, though they are much less interesting.

One pattern in particular has become painfully evident in O’Melveny & Myers’ briefing,

which has settled into a style of argument that typically unfolds in the following manner:

In keeping with this, the go-to response for difficult-to-address allegations in the opera-

tive complaint is to inundate a motion to dismiss with eye-catching terminology like “ad

hominem” and “derogatory” and “inflammatory” and “maligning” and “cruel.” See Dkt.


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No. 185-1, p. 13. Yet, why is that? The process is set up so a party is not supposed to

prevail in a lawsuit by appealing to the literary sensibilities of the presiding judge. Of

course, the real reason that O’Melveny is doing this is because it is engaging in well-

conceived sleight of hand, a game in which it tries to appeal to the emotions of the Court

in the hopes that doing so will take the Court’s eye off of the actual substance of the

Third Amended Complaint. Everything said by O’Melveny is thus counterbalanced by

something even more important that it did not say. For instance, at no point does the

underlying motion to dismiss set forth a legal standard (as is customary in any motion)

and thereby explain that many of the new predicate acts supporting the fourth claim for

relief under the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18

U.S.C. § 1961 et seq., are not based in fraud and thus not subject to the heightened plead-

ing standard of Federal Rule of Civil Procedure 9(b). See, e.g., Bryant v. Mattel, 573 F.

Supp. 2d 1254, 1265 (C.D. Cal. 2007).

In fact, the ploy to circumvent discussing the new predicates involves deconstruct-

ing the revised allegations in the operative complaint and then repackaging them in a way

that makes them largely appear as they did in the prior Second Amended Complaint.

After all, the attack on the sufficiency of the allegations within the motion to dismiss

spends an inordinate amount of time talking about a subject the Court already addressed

(i.e., the predicates involving Quechan) and another that Williams & Cochrane did not

even use as the basis for the claim (i.e., the latest predicates at Pauma). This, of course, is

just a cover to avoid having to discuss the more recent statutory violations that serve as

predicate acts for the continuing scheme by the Rosette defendants to either interfere with

Williams & Cochrane’s contracts or cover up the fact that they have done so – the mis-

representations to a key witness (see Dkt. No. 174-32, ¶ 179), the quid pro quo with a-

nother witness (see id. at ¶ 186), and the threats directed at both attorneys for Williams &

Cochrane. See id. at ¶ 180. Of course, all of this says nothing about the violation of the

Hobbs Act, 18 U.S.C. § 1951, by the Rosette defendants during the rather ignominious

breach of the Attorney-Client Fee Agreement. See id. at ¶ 228(k)-(n). That’s at least four


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distinct predicate acts, all of which fall into the category of those requiring a lower degree

of detail in order to pass muster at this stage of the proceeding.

The addition of new predicates subject to a lessened pleading standard is just one

example of a basis that can give rise to the elusive second predicate act. Another involves

fixing deficiencies noted by the Court, particularly with reference to the interference with

contract and prospective economic relations at La Pena Law. See Dkt. No. 174-32, ¶¶

147-48. The foregoing sentence uses legal terminology related to the invasion of property

rights rather intentionally in order to broach a third basis for the RICO claim, and that is

correcting a fundamental misconception about standing that affects the Court’s prior

analysis of what harms are redressable under this statute that is supposed to be “liberally

construed to effectuate its remedial purposes.” Sedima S.P.R.L. v. Imrex Co., 473 U.S.

479, 498 (1985) (citing Pub. L. 91-452 § 904(a)). In its order on the second round of

motions to dismiss, this Court cited a case by the name of Anza v. Ideal Steel Supply Cor-

poration, 547 U.S. 451 (2006), to hold that the Rosette defendants’ scheme to interfere

with Williams & Cochrane’s contracts could not legally be the proximate cause for the

ultimate contract interference. Putting aside the issue that proximate causation is a fact

issue that is inappropriate to address during this legal-sufficiency stage of the proceeding

(see Mendoza v. Zirkle Fruit Co., 301 F.3d 1163, 1169 (9th Cir. 2002) (citing Knevel-

baard Dairies v. Kraft Foods, Inc., 232 F.3d 979, 989 (9th Cir. 2000)), what Anza dealt

with is a situation in which a business suffered a “passed-on injury” that really affected a-

nother party. See id. In that case, a competitor who failed to pay taxes really just de-

frauded the State to whom the taxes were due, any claim of a slight competitive ad-

vantage notwithstanding. See Rezner v. Bayerische Hypo-Und Vereinsbank AG, 630 F.3d

866, 873 (9th Cir. 2010) (citing Anza, 547 U.S. at 457). However, what happens when

fraud and injury are not necessarily intertwined, such as where a corporation uses shadow

bidders to secure liens at an auction in contravention of a county prohibition on the same?

See Bridge v. Phoenix Bond & Indem. Co., 553 U.S. 639, 649 (2008). In that case, the

fraud affected the county but the injury first and foremost fell on the bidders who lost out


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in the auction as a result of the corporation’s deceitful practice. See id. at 658; see also

Rezner, 630 F.2d at 874 (holding that purchases of tax shelters were injured and thus had

standing to pursue a RICO claim against an individual who had set up the shelters as part

of a scheme to defraud the United States of tax revenues). Here, the injury obviously fell

on Williams & Cochrane given its repudiated contract, a reality that becomes all the more

apparent after accounting for the fact that this Court held that whatever injuries the Que-

chan tribal members may have suffered as a result of the Rosette defendants’ fraudulent

interference were “not significant enough” to create a viable claim for relief. See Dkt. No.

89, p. 37.

The key fact is that the RICO scheme identified in the complaint resulted in the

severance of a contract. The Supreme Court of the United States is typically not one to

pontificate about hypothetical fact patterns for satisfying particular statutory require-

ments, but it did just that with respect to proximate cause under RICO using this very

situation:

Or, to take another example, suppose an enterprise that wants to get rid of a rival business mails misrepresentations about them to their customers and suppliers, but not to the rivals themselves. If the rival businesses lose money as a result of the misrepresentations, it would certainly seem that they were injured in their business ‘by reason of’ a pattern of mail fraud, even though they never received, and therefore never relied on the fraudulent mailings. Yet petitioners [wrongly] concede that, on their reading of § 1964(c), the rival businesses would have no cause of action under RICO, Tr. Of Oral Arg. 4, even though they were the primary and intended victims of the

scheme to defraud.

Bridge, 553 U.S. at 649-50. Proximate causation may be a perceived hurdle to redressing

the interference with the Quechan and La Pena contracts, but it is one the Court needs to

remove because interference with contracts and commercial relations has long been seen

as a valid basis for standing under RICO. See Diaz v. Gates, 420 F.3d 897, 900 (9th Cir.

2005) (en banc) (collecting cases); Mendoza, 301 F.3d at 1170 (explaining a scheme to

“undercut… business rivals” is not derivative of an injury to a third party (citing Com-

mercial Cleaning Servs. v. Colin Serv. Sys., Inc., 271 F.3d 374, 378 (2d Cir. 2001))). The


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injury from this scheme fell directly upon Williams & Cochrane according to both Su-

preme Court and Ninth Circuit precedent. If it somehow did not, the now-alleged con-

spiracy to defraud others with misrepresentations about Williams & Cochrane and its ac-

complishments nevertheless had an obvious victim – Williams & Cochrane itself. See

Rehkop v. Berwick Healthcare Corp., 95 F.3d 285, 289 (3d Cir. 1996) (explaining the

plaintiff still had “standing to bring an action for alleged conspiracy in violation of

RICO” even though the alleged racketeering activity “injured only [third-party] custom-

ers”). No matter how one paints the situation, either the scheme or the conspiracy to en-

gage in the scheme has directly impaired if not outright severed at least three of Williams

& Cochrane’s contracts. These injuries (and others) form the basis of a viable RICO

claim that is anything but implausible. Seeing that Williams & Cochrane intends to pur-

sue this RICO claim to the end of the line, considerations like due respect for precedent

and judicial economy counsel in favor of the Court reevaluating its proximate-cause rul-

ing that is “clearly erroneous.” See Jenkins v. County of Riverside, 398 F.3d 1093, 1093

(9th Cir. 2005) (detailing the law of the case doctrine).

LEGAL STANDARD

Allegations of fraud must be stated with particularity. Fed. R. Civ. P. 9(b). As a

corollary of this rule, predicate acts involving fraud under RICO must accordingly be

pled with particularity under Rule 9(b). See Lancaster Cmty. Hosp. v. Antelope Valley

Hosp. Dist., 940 F.2d 397, 405 (9th Cir. 1991). However, “[o]ther than fraud, RICO pred-

icate acts need not be pled with particularity” and instead just need to be “sufficiently

pled to give [d]efendants notice of the factual basis of the claim.” Salas v. Int’l Union of

Operating Eng’rs, 2015 U.S. Dist. Lexis 20077, *8-*9 (C.D. Cal. 2015) (quoting Slade v.

Gates, 2002 U.S. Dist. Lexis 20988, *18-*19 (C.D. Cal. 2002)); see McLaughlin v.

Anderson, 962 F.2d 187, 194 (2d Cir. 1992) (holding the district court should have

evaluated extortion for purposes of RICO “against the more lenient pleading standards of

[Rule] 8(a)” rather than the more stringent ones of Rule 9(b)); Planned Parenthood v.

Am. Coal. of Life Activists, 945 F. Supp. 1355, 1379-80 (D. Or. 1996) (“Where the al-


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leged RICO predicate acts do not involve fraud, the more lenient pleading standard in

Rule 8(a) applies.”).

When it comes to actual fraud, “[i]n complex civil RICO actions involving multi-

ple defendants Rule 9(b) does not [ ] require that the ‘temporal or geographic particulars

of each mailing made in furtherance of the fraudulent scheme be stated with particular-

ity,’ but only that the ‘plaintiff delineate, with adequate particularity in the body of the

complaint, the specific circumstances constituting the overall fraudulent scheme.’” All-

state Ins. Co. v. Yehudian, 2018 U.S. Dist. Lexis 27129, *27 (E.D.N.Y. 2018). This duty

is simply one to adequately allege; the plaintiff is “not required to provide the evidentiary

basis for its claim… at the [Rule 12] stage of the proceeding.” Hellman Worldwide Logis-

tics, Inc. v. Harris, 2009 U.S. Dist. Lexis 123250, *7 (W.D. Wash. 2009) (citing In re

GlenFed, Inc. Securities Litig., 42 F.3d 1541, 1547-48 (9th Cir. 1994) (“[W]e do not test

the evidence at this stage”)).

ARGUMENT

I. PLAINTIFFS’ AMENDMENTS DO NOT EXCEED THE SCOPE OF THE COURT’S LEAVE

TO AMEND

The argument section of the Rosette defendants’ motion to dismiss begins by pars-

ing the Court’s prior Rule-12 order in the hopes of cobbling together a case that the Third

Amended Complaint somehow exceeds the permitted scope of leave to amend, and this

procedural violation alone warrants “dismissing” the RICO claims with prejudice.1 See

Dkt. No. 185-1, p. 12. “Exceeding the scope of a court’s leave to amend is not necessarily

sufficient grounds for striking a pleading or portions thereof.” Allen v. County of L.A.

Sheriff’s Dep’t, 2009 U.S. Dist. Lexis 133613, *5 (C.D. Cal. 2009) (quoting Sapiro v.

Encompass Inst., 221 F.R.D. 513, 518 (N.D. Cal. 2004) (Patel, C.J.)); see Lambuba Corp.

v. City of Oakland, 2006 U.S. Dist. Lexis 82193, *10 (N.D. Cal. 2006) (collecting cases).

In fact, the general rule is that motions to strike under Rule 12(f) are viewed with dis-

1 What the Rosette defendants are really requesting is that the Court strike the

claims, so this opposition will respond to the argument accordingly.


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favor and should not be used to strike a pleading in whole or in part simply on account of

some procedural defect. See Williams & Cochrane, LLP v. Quechan Tribe of Fort Yuma

Indian Reservation, 2018 U.S. Dist. Lexis 141031, *20 (S.D. Cal. 2018) (declining to

strike a premature answer that Quechan filed in the midst of pleading practice and with-

out leave of court). Rather, the only time a motion to strike should be used in this context

is “when [it is both] necessary to discourage parties from raising allegations completely

unrelated to the relevant claims and when the interests of justice so require.” Beshwate v.

BMW of N. Am., 2017 U.S. Dist. Lexis 164820, *9 (E.D. Cal. 2017) (citing Sapiro, 221

F.R.D. at 517).

Addressing the Rosette defendants’ argument is made unnecessarily difficult by

the fact that the descriptions of citations in the motion to dismiss do not match up with

what the referenced material actually says. For instance, one of the citations points to

page nineteen of the order and contends that the text therein somehow limits Williams &

Cochrane to “curing… deficiencies… [related to] the Rosette [d]efendants ‘attempt[s] to

interfere with W&C’s business through misrepresenting that Rosette successfully litigate-

d the Pauma case.’” See Dkt. No. 185-1, p. 11 (citing Dkt. No. 172, p. 19). Yet, the state-

ment the Rosette defendants point to actually goes towards showing sufficiency as to one

element of the RICO claim (i.e., the pattern of racketeering activity), not deficiency as to

another that needs to be corrected through further pleading practice. Since the Rosette de-

fendants’ evidentiary citations are of no assistance in addressing the overarching argu-

ment, the focus of this section will instead be on referring to other language in the order

to show how Williams & Cochrane understood the scope of leave to amend before begin-

ning the process of revising the Second Amended Complaint.

As to that, the deficiencies noted in the Court’s prior order with respect to the two

RICO claims concerned both the big and the small. Within this latter category were the

specifics of the predicate acts at La Pena Law, as the order explained the existing allega-

tions did not provide sufficient detail about the misrepresentations underlying the wire

fraud, including the “when and how [those misrepresentations were] communicated to La


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Pena.” Dkt. No. 172, p. 15. The Third Amended Complaint tries to alleviate this concern

by including a wealth of new allegations about the situation, including that Robert Ro-

sette had a phone call with Ms. La Pena between August 12, 2010 and August 15, 2010 in

which he interfered with Williams & Cochrane’s contract by falsely telling Ms. La Pena

that the attorneys with Williams & Cochrane both represented a competing tribe and were

running their mouths around Indian Country telling anyone who would listen that they

were solely responsible for doing the compact work that Ms. La Pena was planning on

teaming up with them to do. See Dkt. No. 174-32, ¶ 148.

As for the bigger deficiencies, the order indicated that the Court did not think Wil-

liams & Cochrane had alleged a cognizable injury for many predicate acts. See Dkt. No.

172, p. 20 n.2. The relevant footnote in the order states that “[w]ith regard to Mr. Ro-

sette’s alleged interference with La Pena, Pauma, and ‘potential clients,’ W&C fails to

point to a concrete financial loss that it suffered as a result of the alleged interference.”

See id. Yet, the Second Amended Complaint then under review began the section on La

Pena Law by explaining that Robert Rosette had severed the contractual relationship

between Williams & Cochrane and La Pena Law, one that arose “during the second half

of July 2010” so the parties could, amongst other things, try and devise a fix for Shingle

Springs Rancheria’s ongoing compact woes with the State of California. See Dkt. No.

174-32, ¶¶ 144-45. Knowing that interference with contract is a long-recognized injury

under RICO, Williams & Cochrane assumed the problem with the allegations was a fac-

tual one related to the scheme and the resultant injury not being sufficiently tied together,

which led to revised allegations stating Mr. Rosette’s fraud “resulted not only in the loss

of significant revenues under the existing of counsel arrangement, but the prospect of

substantially more under the partnership agreement arising out of La Pena Law merging

with or acquiring Williams & Cochrane.” Id. at ¶ 150. Yet, the perceived failing could

have just as easily been legal in nature given the analysis in the subsequent section of the

order dealing with the repudiation of the Attorney-Client Fee Agreement at Quechan that

explained a scheme to interfere with that contract could not be the proximate cause for


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the ultimate interference. See Dkt. No. 172, p. 23. Though the law is quite clear that it can

be, Williams & Cochrane nevertheless included an additional revision to indicate that it

was hurt by the conspiracy to engage in the RICO scheme if it was somehow not the pri-

mary victim of a scheme to do the Firm harm. See Dkt. No. 174-32, p. 89; see also See

Rehkop, 95 F.3d at 289 (explaining, again, that a party can be injured by a conspiracy

even if it is not directly hurt by the scheme).

As for the fifth claim for relief pertaining to the subsequent financial fraud at Que-

chan, the order similarly took issue with the “[Second Amended Complaint] fail[ing] to

demonstrate how any Plaintiff was a direct victim of” the scheme to misuse the revenue

sharing funds freed-up as a result of Williams & Cochrane’s representation of the Tribe.

See Dkt. No. 172, p. 27. As mentioned in the Second Amended Complaint itself, the

claim was originally structured to have Williams & Cochrane serve as the named-plaintiff

to avoid pitting one tribal member against another and exacerbating a situation in which

the individuals in power were already threatening non-remediable harms like “banish-

ment/disenrollment.” See Dkt. No. 136, p. 74; see also Mendoza, 301 F.3d at 1168 n.4

(finding standing under RICO when the group most directly harmed (i.e., undocumented

workers) was unlikely to bring suit to vindicate its own rights). Nevertheless, a footnote

to the fifth claim for relief in the Second Amended Complaint explained that Williams &

Cochrane was reserving the right to amend “this claim to bring it on behalf of some or all

of the named Quechan General Councilmembers” if the Firm could figure out how to do

so in a manner that would protect the interests of any named tribal-member plaintiffs. See

Dkt. No. 136, p. 74. The Third Amended Complaint did just what Williams & Cochrane

said it would do and did so in the intended manner by simply changing the configuration

of the parties – bringing the claim on behalf of the Quechan General Councilmembers

and against just the Rosette defendants. See Dkt. No. 174-32, p. 99.

This section of the argument could go through each and every revision in the Sec-

ond Amended Complaint individually and show that they are all tied to issues raised by

the Court in its prior order. Space limitations make doing so impossible, however. Never-


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theless, what this discussion hopefully shows is that the vast majority of new text in the

Third Amended Complaint ties directly to issues identified in the prior order and thus

comes nowhere near satisfying the “completely unrelated” test for granting a motion to

strike. Not to mention, the judges in this district are no strangers to providing directions

in motion-to-dismiss orders when they really want to limit leave to amend. See, e.g.,

Little v. Gore, 188 F. Supp. 3d 1005, 1016 (S.D. Cal. 2016). A typical example of such

directions reads as follows:

Because Plaintiffs may be able to allege additional facts that will show they are entitled to punitive damages under the standards articulated above, they are given leave to amend. The scope of leave to file an amended complaint is limited to amending only as to punitive damages in order to allege additional facts that cure the defects identified in this order. Plaintiffs may not plead additional claims, add additional parties, or add allegations that are not intended to cure the specific defects the Court has noted. Should any amended complaint exceed the scope of leave to amend granted by this order, the court will strike the offending portions under Rule 12(f).

Campos v. Failla, 2016 U.S. Dist. Lexis 42745, *10-*11 (S.D. Cal. 2016). These are

instructions that the Rosette defendants could have requested at the hearing on the last

round of motions to dismiss, and they would have at least provided Williams & Cochrane

with fair notice that its right to amend was tightly circumscribed and any extraneous mat-

erial would invariably be excised from the pleading. If any fault exists in this situation, it

should primarily lie upon someone other than the party who put in significant effort to

revise the operative pleading in accordance with the Court’s order, and it certainly does

not warrant the drastic strike-entire-claims remedy requested by the Rosette defendants.

II. THE THIRD AMENDED COMPLAINT DOES NOT VIOLATE THE COURT’S PRIOR

ORDER AND DOES NOT ADD DEROGATORY ALLEGATIONS THAT SHOULD ALSO BE

STRUCK UNDER RULE 12(F)

The problem raised at the outset of the discussion in the last section about the

Rosette defendants’ misstating the prior Rule-12 order infects this section as well. The

whole basis of this second argument that seeks to strike portions of the Third Amended

Complaint is that the “Plaintiffs ignored the Court’s Order” to “refile their complaint


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omitting [certain] allegations” “[i]f [they] do not seek leave to amend their complaint.”

Dkt. No. 185-1, pp. 12-13. Yet, Williams & Cochrane did amend its complaint. What this

language instructed Williams & Cochrane to do, for unspecified reasons, was to remove

certain allegations in the event the Firm did not amend the RICO claims and elected to

stand upon the remaining claims in the Second Amended Complaint. Thus, the Rosette

defendants are arguing a moot point, as the comment about striking allegations has abso-

lutely no bearing on the present state of affairs.

Nor should it. This Court exhaustively laid out the legal standard for a motion to

strike in its high-profile suit involving Trump University, stating:

A motion to strike is brought under Federal Rule of Civil Procedure 12(f). Rule 12(f) provides that a ‘court may strike from a pleading any insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.’ The function of a motion to strike is to avoid unnecessary expenditures that arise throughout litigation by dispensing of any spurious issues prior to trial. Sidney-Vinstein v. A.H. Robins Co., 697 F.2d 880, 885 (9th Cir. 1983). Rule 12(f) motions ‘are generally regarded with disfavor because of the limited importance of pleadings in federal practice, and because they are often used as a delaying tactic.’ Neilson v. Union Bank of Cal., N.A., 290 F. Supp. 2d 1101, 1152 (C.D. Cal. 2003). Thus, courts generally grant a motion to strike only where ‘it is clear that the matter to be stricken could have no possible bearing on the subject matter of the litigation.’ Walters v.

Fidelity Mortg. of Cal., 730 F. Supp. 2d 1185, 1196 (E.D. Cal. 2010) (citing Lilley v. Charren, 936 F. Supp. 708, 713 (N.D. Cal. 1996)).

‘A motion to strike is… not normally granted unless prejudice would result to the movant from the denial of the motion.’ United States v. 729,773

Acres of Land, 531 F. Supp. 967, 971 (D. Haw. 1982). The Ninth Circuit has found a motion to strike appropriately granted where the allegations at issue ‘created serious risk of prejudice… delay, and confusion of the issues.’ Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1528 (9th Cir. 1993), rev’d

on other grounds, 510 U.S. 517, 114 S. Ct. 1023, 127 L. Ed. 2d 523 (1994).

Cohen v. Trump, 2014 U.S. Dist. Lexis 23885, *25-*26 (S.D. Cal. 2014). Distill these

rules down to their essence and the grounds for granting a motion to strike come from

including in a pleading extraneous material – with absolutely no bearing on the subject

matter of the litigation whatsoever – that causes a serious risk of prejudice to the oppos-


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ing party. This is obviously an extremely high standard for a movant to satisfy, especially

since “unpleasant” allegations are not liable to be struck simply because they are

unpleasant. See Gateway Bottling, Inc. v. Dad’s Rootbear Co., 53 F.R.D. 585, 588 (W.D.

Pa. 1971) (“The facts here may be unpleasant for plaintiff to have on the record and they

certainly contain charges of reprehensible conduct but the same is true of many facts of

life which are entitled to be pleaded as relevant to a cause of action or defense.”).

How does this play out then in the RICO context where a court may be confronted

with allegations that an unscrupulous defendant did unscrupulous things? Coincidentally,

this Court already dealt with the situation in the case of Osgood v. Main Street Market-

ing, LLC, 2017 U.S. Dist. Lexis 5625 (S.D. Cal. 2017). In Osgood, the natural-person

plaintiffs were the recipients of unwanted telemarketing phone calls from a company

named Main Street that was just the alter ego of an individual named, alternatively, Jer-

rod McAllister or Jerrod Robker. Id. at *1 n.1 & *3. What Main Street would do is “hire a

third party company in India to originate its telemarketing phone calls in an effort to in-

tentionally evade [relevant] federal and California criminal laws” and then call individ-

uals residing in the United States, regardless of whether or not they were registered with

the national do-not-call list for calls and/or texts. Id. at *3. To compound the situation,

Main Street would also secretly record all of the telemarketing phone calls, failing to

advise the callees “at the outset of their calls that the calls might be recorded.” Id. at *4.

This pattern of behavior led certain residents of California to initiate an action against

Main Street that raised, amongst other things, violations of RICO and the Telephone

Consumer Protection Act, 47 U.S.C. § 227. Id. at *2.

As part of the First Amended Complaint, the plaintiffs included multiple para-

graphs that detailed concerning communications2 that Mr. McAllister/Robker had sent to

them after learning he was being sued. One paragraph of the First Amended Complaint

explained:

2 The order in Osgood does not censor profane language so neither will this opposi-

tion.


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Defendant Jerrod McAllister sent several false and fraudulent emails to Plaintiff Ewing that stated, in part, the following: ‘I’m not afraid to go to court with you. My attorneys will chew you up and shit you out like the piece of shit you are…[,]’ ‘you deserve to be beaten[,]’ ‘Fuck yourself[,]’ ‘You’re seriously pathetic[,]’ ‘Goodbye, loser[,]’ ‘you’re a tool and an ambulance chaser[,]’ [and] ‘dickheads like you[.]’

Id. at *30. And yet another paragraph of the First Amended Complaint detailed the con-

tents of another e-mail from Mr. McAllister/Robker:

On May 4, 2016 Jerrod McAllister aka Jerrod Robert [sic] wrote an email… to Plaintiff Ewing that stated ‘chew [me] up and shit down [my] throat like the peace [sic] of shit [I am]’ followed by ‘[I] deserve to be beaten’ and then ended the email with ‘Fuck yourself.’

Id. at *31. Seeing its clients’ incorrigible communications in the First Amended Com-

plaint led defense counsel to file a motion to strike, claiming the recent statements could

have no possible bearing on the RICO scheme that involved placing illegal telemarketing

calls from overseas. See id. This Court was not sold on the argument, however, stating

that “[b]ased on the pleading, the Court is not entirely convinced the communications by

McAllister are immaterial… [and] therefore, at this time, the Court DENIES Defendants’

motion to strike[.]” Id.

The e-mail communications in Osgood bore a somewhat attenuated connection to

the RICO scheme, and this Court nevertheless allowed them to remain in the operative

complaint. What is a lot less attenuated than that is the connection between the objection-

able allegations in this case and the RICO scheme described in the Third Amended Com-

plaint. The first batch of contested allegations in the Second Amended Complaint detail

how Mr. Rosette has a propensity for covertly representing individual tribal members and

then causing monumental problems within the tribe as a result – whether it is creating fi-

nancial irregularities, disenrolling political opponents en masse, or aiding the commission

of total repudiations of multi-million-dollar commercial contracts. See Dkt. No. 174-32,

¶¶ 110-16. These allegations not only have a bearing on the RICO scheme in this case but

the breach of the implied covenant of good faith and fair dealing claim as well. The latest


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objected-to allegations in the Third Amended Complaint address additional issues. What

would cause a lawyer to target other ones when he readily admits the work he obtains

after severing their contracts probably would not even pay the salaries of the associates

who are assigned to perform the work? See Dkt. No. 54-2, p. 27. What would cause said

lawyer to continue to target these individuals more than seven years after their last real

interaction? What would cause said lawyer to threaten the other attorneys when finally

seeing them in person after the filing of the case? What would cause said lawyer to risk

buying off a key witness to the RICO scheme in the hopes of blocking the disposition of

the lawsuit?

Of course, the answer to all of this is uncontrollable animosity.3 This much is evi-

dent from both Mr. Rosette’s deportment after learning the attorneys with Williams &

Cochrane wanted to restructure their relationship to an “of counsel” one in the spring of

2010, and his actions immediately after losing the Pauma client to them while at his fa-

ther’s funeral a few months later. See Dkt. No. 174-32, ¶¶ 32, 123-24. This Court made a

comment at the hearing on the second round of motions to dismiss that the put-them-out-

of-business RICO claim was sort of a “Witches’ Brew” concocted out of a bunch of no-

xious ingredients. What the attorneys with Williams & Cochrane are trying to say is that

Mr. Rosette has been motivated by non-financial factors to devote more than eight years

of his life to spitefully and incessantly targeting two other attorneys, damaging (if not

outright severing) at least three of their contracts and peddling one of their signature liti-

gation victories for his own personal benefit countless times. As the latest interference at

Pauma during the summer of 2018 hopefully shows, this insatiable bloodlust means that

the RICO scheme is going to continue unabated until Mr. Rosette is finally successful in

putting Williams & Cochrane out of business altogether. Regardless of how this Court

3 This discussion puts aside questions of subsequent fraud against the tribal clients.

There are hundreds of federally-recognized Indian tribes whom Mr. Rosette can represent and/or defraud (five-hundred and seventy-seven to be exact), so why is it that he keeps turning up at the ones Williams & Cochrane represents? See 83 Fed. Reg. 4235 (Jan. 30, 2018) (listing all the federally-recognized Indian tribes).


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perceives the RICO scheme, Williams & Cochrane intends to appeal any orders dismis-

sing the claim in whole or in part to the Ninth Circuit. Thus, the allegations the Rosette

defendants want stricken have an obvious relation to this litigation, and they need to re-

main in the Third Amended Complaint so Williams & Cochrane has the ability to make

its case to the Ninth Circuit if and when that time comes.

III. THE THIRD AMENDED COMPLAINT ALLEGES AT LEAST FIVE CONCRETE INJUR-

IES PROXIMATELY CAUSED BY THE ALLEGED RICO SCHEME

The proximate causation issue has become so warped that one could open a

discussion about it by saying it exists in “a dimension as vast as space and as timeless as

infinity.” See Internet Movie Database, Twilight Zone, available at https://www.imdb.

com/title/tt0052520/ (last visited Jan. 26, 2019). The fourth claim for relief in the Third

Amended Complaint lays out rather succinctly the basis for the RICO scheme – the con-

duct of an enterprise that has sought to fraudulently interfere with Williams & Coch-

rane’s contracts (often to commit fraud against the Firm’s tribal clients). See Dkt. No.

174-32, ¶ 227. This interference can come in many forms, two of which are discussed at

length in the Third Amended Complaint: (1) direct interference, and (2) by falsely pro-

moting that he is responsible for successfully litigating a seminal case upon which Wil-

liams & Cochrane may obtain future work. Obviously, the first category can encompass

the second, but somehow the broader conspiracy has been largely removed from the

picture in both the prior order and thus the Rosette defendants’ latest motion to dismiss.

Now, the whole focus has shifted to the Rosette defendants’ false advertisements, which

somehow makes it impossible for Williams & Cochrane to show a concrete injury like a

severed contract in a case that is rife with severed contracts.

The introduction discusses how the Court erred under binding Ninth Circuit prece-

dent by trying to make a factual determination about the actual cause of the repudiated

Attorney-Client Fee Agreement when the pleading stage simply inquires whether it is

plausible that the RICO scheme could be such a cause. See Mendoza, 301 F.3d at 1169;

Willie McCormick & Assocs. v. Lakeshore Eng’g Servs., 2015 U.S. Dist. Lexis 114365,


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*15 (E.D. Mich. 2015) (“[A] RICO case with a traditional proximate-cause problem (e.g.,

a weak or insubstantial causal link, a lack of foreseeability, or a speculative or illogical

theory of damages)… will more often be fodder for a summary-judgment motion under

Rule 56 than a motion to dismiss under Rule 12(b)(6).” (citing NOW v. Scheidler, 510

U.S. 249, 256 (1994))). But, the larger point is that somehow everyone is off in the weeds

trying to dissect specious injuries when the actual injuries appear right on the face of the

Third Amended Complaint. One of the leading RICO cases from the Supreme Court ex-

plains that contract damages – like those suffered at Quechan, La Pena, and even Pauma

– can serve as the basis for a RICO suit as a result of nothing more than two allegations

of mail and wire fraud. See Religious Techs. Ctr. v. Wollersheim, 796 F.2d 1076, 1080

(9th Cir. 1986) (citing Sedima, 473 U.S. 479). Short of that, the loss of future business

profits – like those experienced at Quechan, La Pena, Pauma, and innumerable other

tribes who received the Rosette defendants’ false advertisements – can also serve as a

concrete injury for the causation analysis. See GMC v. Ignacio Lopez de Arriortua, 948 F.

Supp. 670, 681 (E.D. Mich. 1996) (explaining “lost profits are recoverable under

RICO”); Planned Parenthood Fed’n of Am., Inc. v. Ctr. for Med. Progress, 214 F. Supp.

3d 808, 820 (N.D. Cal. 2016) (explaining a decrease in the volume of business is a valid

injury (citing Planned Parenthood, 945 F. Supp. 2d at 1382)). Short of even that, the loss

of just a specific future business opportunity – like that at Quechan, La Pena, Pauma, and

innumerable other tribes who received the Rosette defendants’ false advertisements – is a

viable injury. See Xcentric Ventures, LLC v. Borodkin, 798 F.3d 1201, 1203 (9th Cir.

2015) (explaining a RICO claim was tenable where a company lost a specific business

opportunity because of a negative review); Lowe v. Eltan B.V., 2006 U.S. Dist. Lexis

97687, *44-*45 (E.D. Tex. 2006) (indicating a company whose intangible property was

misappropriated had suffered an injury in the form of lost business opportunities). Yet,

short of even that, all Williams & Cochrane has to show is that it took time away from its

normal work and devoted resources to dealing with the fallout of the RICO scheme. See

Just Film, Inc. v. Buono, 847 F.3d 1108, 1119 (9th Cir. 2017) (“The district court proper-


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ly concluded that Campbell had standing to pursue the RICO claim because… she spent

time away from her usual work and paid an assistant to help her research and compile

records responding to a fraudulent allegation.”). At this point, the devolution of relations

at Quechan has involved Williams & Cochrane devoting considerable time prior to the

suit trying to figure out how to deal with the June 26, 2018 and June 30, 2018 termination

letters from putative Quechan President Keeny Escalanti, and likely more than one-

thousand hours since the filing of this suit – often in recurrent eight-to-ten day briefing

intervals – to litigating the issues in the case. Thus, it is simply implausible to say that the

Firm cannot allege a plausible concrete injury.

If the prior paragraph makes it sound as if it is easy to identify a concrete injury

under the RICO statute, that is because it is. The traditional test simply looks at whether

the injury claimed by the plaintiff resulted in a “concrete financial loss” and constitutes

“harm to a specific business or property interest” that is “cognizable under state law.”

Canyon County v. Syngeta Seeds, Inc., 519 F.3d 969, 975 (9th Cir. 2008) (citing, e.g.,

Diaz, 420 F.3d at 900). Yet, this requirement of a “concrete” harm to a business or prop-

erty interest is a “relatively low threshold” that just requires basing “the fact of dam-

age… on a plausible theory.” In re Volkswagen “Clean Diesel” Mktg., Sales Practices, &

Prods. Liab. Litig., 2018 U.S. Dist. Lexis 171598, *323 (N.D. Cal. 2018); see In re

Chrysler-Dodge-Jeep EcoDiesel Mktg., Sales Practices & Prods. Liab. Litig., 295 F.

Supp. 3d 927, 962 (N.D. Cal. 2018) (“Mendoza and Diaz establish a relatively low

threshold for plaintiffs to adequately plead a ‘concrete’ RICO injury.”). And in Califor-

nia, that low threshold is even lower since the codes give “property” a broad, “all-em-

bracing” definition that goes so far as to even include “every intangible benefit and pre-

rogative susceptible to possession or disposition.” People v. Fisher, 216 Cal. App. 4th

212, 217 (3d Dist. 2013). Like all other states, the California definition of property in-

cludes contracts, which, as mentioned above, means that interference with contract is a

“plausible theory” for a RICO claim. See Guerrero v. Gates, 442 F.3d 697, 707 (9th Cir.

2006). Yet, so too is goodwill – “or the benefits that accrue to a business as a result of its


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location, reputation for dependability, skill or quality, and any other circumstances re-

sulting in probable retention of old or acquisition of new patronage” (see Community

Dev. Comm’n v. Asaro, 212 Cal. App. 3d 1297, 1302 (4th Dist. 1989)) – which means

that the Rosette defendants’ false advertisements that impinged on that goodwill also

serve as a “plausible theory” for the RICO claim. See Cal. Bus. & Prof. Code § 17500.

Thus, all of the talk about an uncertain diminution in market share is just a diversion from

the actual injuries to contracts, profits, opportunities, goodwill, and the very name of Wil-

liams & Cochrane.

IV. THE THIRD AMENDED COMPLAINT ALLEGES A PLETHORA OF RICO PREDICATE

ACTS FOR THE CONSPIRACY AND/OR SCHEME

The effort to dissuade the Court from identifying a second predicate act that will

enable the fourth claim for relief to go forward involves the Rosette defendants expend-

ing an immense amount of energy in classifying and rewriting the allegations so they can

address what they want the Third Amended Complaint to say, rather than what it actually

does say. For everyone’s benefit, this section will do what the Rosette defendants should

have done in the first place and list most of the primary grounds for the second predicate

act, making sure to state within each subsection the evidentiary and (when necessary)

legal support for the proposition.

A. Website Advertisement

It makes sense to start the discussion with the predicate act identified by the Court

in its prior Rule-12 order – “Rosette’s website advertise[ment] that Mr. Rosette success-

fully litigated the Pauma case.” Dkt. No. 172, p. 16. However, this is much more than just

one predicate act. Imagine for a moment that a computer hacker illegally accessed the

source code for a bank website and implanted within the code an algorithm that would

redirect a penny from every online transfer initiated by one of the banks’ customers to a

shell account created by the hacker. Infecting the website with this malware is a single act

that nevertheless has many effects depending upon the number of impacted customers,

and thus the total wire fraud count needs to include not only the initial act by the hacker


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of uploading the algorithm, but also the number of times that the algorithm reached out to

customers and had an impact on their transactions.

Take for example the case of C&M Café v. Kinetic Farm, Inc., 2016 U.S. Dist.

Lexis 161262 (N.D. Cal. 2016). In C&M Café, the district court confronted a situation in

which the defendant had created an imposter website for a popular restaurant run by the

plaintiff. Id. at *3. The sham website tried to replicate the authentic one, appearing at a

similar URL and displaying on its homepage actual “menu items and a photo from a

Yelp! review submitted by a C&M customer.” Id. The way the operators of the sham

website were able to take advantage of the situation is by engaging in search engine opti-

mization so its website appeared first in search results, and then partnering with a phone

app that allowed customers to place orders with what they thought was C&M Café. Id. at

*4. The plaintiff brought suit and claimed that the creation of the imposter website was an

illegal RICO scheme that diverted customers away from their legitimate website and tried

to monetize that through the phone app. Id. at *16. The district court had no problem

concluding that the plaintiff had suffered an injury to its business or property interests as

a result of this scheme, stating that “interference with business relations [is] sufficient to

allege injury to [such an] interest.” Id. at *21 (citing, e.g., Diaz, 420 F.3d at 900). But,

implicit in this discussion is an acknowledgement by the court that the predicate act for

the fraudulent scheme was not just the defendant putting the website online, but each in-

stance that it had “inserted [itself] between C&M and the consumer;” after all, the plain-

tiff suffered a discrete injury each and every time, not just in the form of lost business

opportunities but also in terms of damage to its goodwill as well. Id. at *22 (“It has al-

leged that defendants inserted themselves between C&M and the consumer, causing

C&M to improperly take the blame for any order mistakes or delivery delays and causing

consumers to believe C&M was charging them more for its menu items than it actually

was.”). Thus, a single act that serves as the basis for a “continuing operation” produces a

total number of predicate acts that turns upon the quantum of deceived customers. See

Lowe, 2006 U.S. Dist. Lexis 97687 at *44 (explaining the wrongful marketing of another


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company’s products is a “continuing operation” that provides the requisite predicate

acts). In this case, the false website advertisement by the Rosette defendants had an ob-

vious impact on Quechan, but there are assuredly other tribes as well – the identities of

whom will only come to light through the discovery process.

B. Promotional Materials

This false advertisement exists not only on the Rosette website but in the promo-

tional materials the Rosette defendants disseminate to actual and prospective clients as

well. However, the prior Rule-12 order did not count this as a predicate act due to the

“[Second Amended Complaint] fail[ing] to allege a wiring or mailing to support these ac-

tions as acts of mail or wire fraud.” Dkt. No. 172, p. 17. To rectify this situation, Wil-

liams & Cochrane first consulted the relevant evidence on the docket in order to bolster

the allegations in the operative complaint, including the declaration filed by an executive

assistant at Rosette LLP that admits the promotional materials containing the false adver-

tisement are distributed in the “ordinary course of business” and “retained on the firm’s

share drive.” Dkt. No. 32-2, ¶¶ 4-5 & p. 11. Relying on this and similar evidence, Wil-

liams & Cochrane inserted a new subpart (i) in paragraph 228 to explain the Rosette de-

fendants had used the “mails and wires… (i) [c]ountless times since March 18, 2013 to

disseminate promotional materials to actual and prospective clients in the admitted ‘or-

dinary course of business’ that contain identical representations [to the false one on the

website] that Mr. Rosette ‘successfully litigated a case saving the Pauma Band of Luiseno

Mission [Indians] over $100 Million in Compact payments allegedly owed to the State of

California.’” Dkt. No. 174-32, p. 96. As with the prior section, the creation of the promo-

tional materials assuredly involved at least one predicate act, but each subsequent dissem-

ination of the materials through the mail or over the wires was another one as well – a

total number that, again, only discovery will reveal.

C. Quechan

Revisiting a point made twice earlier in this brief, the Court also declined to con-

sider any of the events leading to the last-minute repudiation of the Attorney-Client Fee


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Agreement as predicate acts because, from an injury standpoint, any number of reasons

can influence that decision and “‘it would require a complex assessment to establish what

portion’ of the termination was the product of Rosette telling Quechan that he had suc-

cessfully litigated the Pauma case.” Dkt. No. 172, p. 24. Again, this stage of the litigation

is only concerned with whether or not there is a recognized factual basis for the injury,

not the extent of the injury itself. See Mendoza, 301 F.3d at 1169. Not to mention, the po-

sition the Court has taken would essentially block any plaintiff from combatting a RICO

scheme that results in one of the most damaging injuries – interference with a contract –

because the other party to the contract can always cite some superficially-neutral reason

why it decided to breach the agreement. Of course, the discovery process is supposed to

provide a plaintiff with the proof needed to show that its injury resulted directly from the

fraud perpetrated by the participants of the RICO scheme, which goes to show that the

prior Rule-12 order simply put the cart before the horse and made a legal conclusion

about a factual issue. The crucial point for this section is that courts higher up have rec-

ognized both the acts (i.e., misrepresentations) and the injuries (i.e., interference with

contract) at the heart of this case as forming the basis for a valid RICO claim. See Bridge,

553 U.S. at 649-50 (explaining a business is “the primary and intended victim” when a

competitor “mails misrepresentations about them to their customers and suppliers” in an

attempt to “get rid of [the] rival”). There is simply no basis under existing law for declin-

ing to look at the connection between the racketeering act and the claimed injury, which

means that this Court should consider the fraud that is alleged to have led to the repudi-

ation of the Attorney-Client Fee Agreement at Quechan as constituting at least one more

predicate act.

D. La Pena Law

The prior Rule-12 order also noted that the Court would not consider the allega-

tions of fraud at La Pena Law as sufficient for the second predicate act because the Sec-

ond Amended Complaint “does not allege when and how… [Mr. Rosette] communicated

to La Pena” that he was “responsible for litigating the Pauma case.” Dkt. No. 172, p. 15.


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The Third Amended Complaint addresses this concern by adding a new allegation stating

that Robert Rosette sent an e-mail to Ms. La Pena shortly before August 11, 2010 in

which he explained that he “was responsible for litigating the Pauma case.” See Dkt. No.

174-32, ¶ 147. On top of which, the Third Amended Complaint also contains new allega-

tions concerning a phone call between Robert Rosette and Ms. La Pena on or around

August 12, 2010 during which Mr. Rosette made two more misrepresentations about the

attorneys at Williams & Cochrane: that (1) they then-represented a tribal competitor to

one of her clients, and (2) they were also publicly and rather extensively bragging that

they had just been exclusively hired by her tribal client to do the compact work the firms

had discussed undertaking together. See id. at ¶ 148. For those keeping track, that is one

terminated “of counsel agreement” and three distinct instances of wire fraud, any one of

which should serve as the second predicate act.

E. June 26 & June 30, 2017 Termination Letters at Quechan

Along with correcting noted deficiencies, the Third Amended Complaint also ad-

ded new allegations related to predicate acts that are disconnected from fraud and thus are

not subject to the heightened pleading standard of Rule 9(b). See Bryant, 573 F. Supp. 2d

at 1265. Two such allegations are detailed in the fourth claim for relief – the ones pertain-

ing to the Rosette defendants “author[ing] and arrang[ing] to transmit” the June 26th and

June 30th termination letters by putative Quechan President Keeny Escalanti. See Dkt.

No. 174-32, p. 96. These are the letters that demanded Williams & Cochrane turn over

the final draft of the compact using egregious threats to its reputation and financial stan-

ding, and prohibited the Firm from contacting anyone associated with the Tribe to deter-

mine whether this request – which was unsupported by any official governmental resolu-

tion and went against everything that had been communicated up until that point – was

even legitimate. See, e.g., id. at ¶¶ 94-104. That is the use of fear in order to obtain the

property of another – or a violation of the Hobbs Act. See Prime Healthcare Servs. v.

Serv. Employees Int’l Union, 147 F. Supp. 3d 1094, 1105 (S.D. Cal. 2015). With this

statutory violation constituting a form of “racketeering activity” under Section 1961(1),


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this Court should consider the termination letters to be two additional predicate acts of

the RICO schemes (as alleged in both the fourth and fifth claims).

F. April 18, 2018 Threat to the Attorneys of Williams & Cochrane

As the complexion of the situation has changed so too has the RICO scheme, with

its focus extending from just severing Williams & Cochrane’s contracts to trying to cover

up the same. The Third Amended Complaint details some of the conduct by Robert Ro-

sette since the commencement of the suit that is designed to prevent it from going for-

ward. One rather troubling example is set forth in paragraph 180 of the Third Amended

Complaint and involves Robert Rosette seeing the attorneys of Williams & Cochrane for

the first time in many years and exclaiming with a white hot rage that he was going to

either “hurt them” or “get them.” See Dkt. No. 174-32, ¶ 180. The new allegations in the

Third Amended Complaint make it clear that the attorneys with Williams & Cochrane

understood this statement as being a threat of harm due to their pursuit of this lawsuit –

one he would follow-up on soon thereafter, at least from a business perspective, by once

again attacking the Firm’s client relationship with the Pauma tribe. See id. at ¶ 181.

Obstruction of justice and witness tampering are not only defined forms of “racketeering

activity” under Section 1961(1), but ones that other federal courts have held can form the

basis of RICO liability if “committed in the course of a civil lawsuit.” J & M Turner v.

Applied Bolting Tech. Prods., 1997 U.S. Dist. Lexis 1835, *41 (E.D. Pa. 1997) (citing

Malley-Duff & Assoc. Inc. v. Crown Life Ins. Co., 792 F.2d 341 (3d Cir. 1986)). This rule

should apply with equal force in this case, especially in light of Mr. Rosette’s other sus-

pect actions involving Mr. Dhillon and Ms. La Pena. See Dkt. No. 174-32, ¶¶ 179, 185-

86.

G. November 1, 2018 Press Release on Law Pena Law

The final name referenced in the sentence above shows how the eight-year RICO

scheme continues to the present day. The subject of Robert Rosette’s interference with

Williams & Cochrane’s contract at La Pena Law was a big topic of conversation at the

October 12, 2018 hearing on the last round of motions to dismiss. So, what does Robert


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Rosette do upon learning this information from his litigation counsel? He pulls Ms. La

Pena out of retirement by hiring her to be a partner at his law firm. See Dkt. No. 174-32,

¶ 185; Rosette, LLP, Biography of Michelle La Pena, available at https://www.rosette

law.com/professionals/michelle-l-lapena/ (last visited Jan. 27, 2019). If he was truly in-

terested in an employment arrangement of this nature, this is something he could have

pursued at any point from 2009 to 2017; yet he instead decided to do this immediately

after learning she may be an adverse witness in a federal lawsuit that could cost him mil-

lions of dollars. This should show that the timing is not just some coincidence; Mr. Ro-

sette has tried to buy Ms. La Pena’s loyalty in the hopes of getting rid of the perceived

“low hanging fruit” for the RICO claim. Yet, all this latest event has done is compound a

bad situation for Mr. Rosette – turning one set of predicates related to contract inter-

ference in 2010 into two in 2018.

V. THE ANCILLARY ARGUMENTS RAISED IN THE ROSETTE DEFENDANTS’ MOTION

TO DISMISS ABOUT NARROWING THE ENTERPRISE AND SKIRTING AROUND

INTRA-TRIBAL AFFAIRS ARE MERITLESS

The tail-end of the motion to dismiss delves into assorted issues like one that sug-

gests some lesser players at Rosette, LLP should be excluded from liability for the RICO

scheme. One of these is Richard Armstrong, but the law is abundantly clear that the en-

terprise covers “lower rung participants… who are under the direction of upper man-

agement.” United States v. Diaz, 649 F. App’x 373, 383 (9th Cir. 2016). In the law firm

context, what this means is that subordinate attorneys are exposed to liability for engag-

ing in “routine” legal work that is designed to further the ends of the enterprise. See Ou-

winga v. Benistar 419 Plan Servs., 694 F.3d 783, 792-93 (6th Cir. 2012). The fallacy in

the Rosette defendants’ argument is that Mr. Armstrong is just some blissful subordinate

pushing papers at the direction of others; the Third Amended Complaint alleges that he is

conversely a longtime senior of counsel with Rosette, LLP who had the choice of de-

ciding whether he wanted to take part in interfering with Williams & Cochrane’s con-

tracts at Pauma and Quechan. See, e.g., Dkt. No. 174-32, ¶¶ 100, 154-56.


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The more interesting aspect of this argument relates to Rosette & Associates. For

the Court’s edification, the law firm of Rosette, LLP has two partners according to the

Arizona Secretary of State – a person named Saba Bazzazieh and an entity named Rosette

& Associates, PC:

See Arizona Secretary of State, Partnership search, available at https://apps.azsos.gov/

apps/tntp/se.html (last visited Jan. 27, 2019). In reality, Rosette & Associates is simply

the alter ego of Robert Rosette – an entity through which he receives revenues that he

does not share with the other partners of his firm. Thus, this attempt to eliminate Rosette

& Associates from the enterprise has nothing to do with the alter-ego entity lacking a role

in the fraudulent scheme and everything to do with it possessing actual assets against

which Williams & Cochrane could satisfy a judgment in this case. Finally, as for the

other argument that contends the fifth claim for relief impermissibly wades into intra-

tribal issues, it is important to remember that Robert Rosette is not a Quechan tribal

member and even if he was the federal courts would still allow the claim to proceed. See

Miccosukee Tribe of Indians of Fla. v. Cypress, 814 F.3d 1202 (11th Cir. 2015) (hearing

a RICO claim against a former chairman for engaging in a scheme to fraudulently abuse

the finances of the tribe).

CONCLUSION

For the foregoing reasons, plaintiffs respectfully request that the Court deny the

Rosette defendants’ motion to dismiss and/or strike.


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RESPECTFULLY SUBMITTED this 28th day of January, 2019

WILLIAMS & COCHRANE, LLP

By: /s/ Kevin M. Cochrane

Cheryl A. Williams Kevin M. Cochrane [email protected] [email protected] WILLIAMS & COCHRANE, LLP 125 S. Highway 101 Solana Beach, CA 92075 Telephone: (619) 793-4809


cheryl a. williams (cal. bar no. 193532) williams ...case no.: 17-cv -01436 gpc msb opp’n to...

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