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COR Clearing, LLC v. Calissio Resources Group, Inc.

United States District Court, D. Nebraska

December 9, 2016

COR CLEARING, LLC, a Delaware limited liability company, Plaintiff,
v.
CALISSIO RESOURCES GROUP, INC., a Nevada corporation, ADAM CARTER, an individual, SIGNATURE STOCK TRANSFER, INC, A Texas corporation; and DOES 1-50, TD AMERITRADE CLEARING, INC., a Nebraska corporation, NATIONAL FINANCIAL SERVICES LLC, a Delaware limited liability company, SCOTTRADE, INC., an Arizona corporation, and E-TRADE CLEARING, LLC, a Delaware limited liability company, Defendants.

          MEMORANDUM AND ORDER

          LYLE E. STROM, Senior Judge.

         This matter is before the Court on a joint motion to dismiss filed by National Financial Services, LLC, TD Ameritrade Clearing, Inc. (“TDAC”), Scottrade, Inc., and E-Trade Clearing, LLC, (hereinafter collectively the “Clearing Firm Defendants”) (Filing No. 137). The Clearing Firm Defendants have submitted a brief (Filing No. 138), an index of evidence (Filing No. 139) and a reply brief (Filing No. 151) in support of the motion. The plaintiff, COR Clearing, LLC, (“plaintiff” or “COR”), has filed a brief in opposition to the joint motion to dismiss (Filing No. 149) as well as an index of evidence in support of its brief in opposition to the motion (Filing No. 150). After review of the motion, the parties' briefs, and the applicable law, the Court finds as follows.

         BACKGROUND

         On August 26, 2015, COR Clearing filed its first complaint against Calissio Resources Group, Inc. (“Calissio”), Adam Carter (“Carter”), Signature Stock Transfer, Inc. (“Signature”), and Does 1-50 (Filing No. 1). Plaintiff's complaint alleged three causes of action including: (1) a request for declaratory judgment; (2) unjust enrichment; and (3) fraud. See Id. at 9-13. The complaint alleged that defendants “calculated [a] scheme to defraud the marketplace and the clearing system in order to obtain millions of dollars from unsuspecting market participants by exploiting a weakness in the dividend payment system of the third-party Depositary Trust Clearing Corporation (“DTCC”).” (Id. at 1).

         On November 10, 2015, following a hearing, the Court denied COR's expedited motion (Filing No. 20) for the appointment of a limited purpose receiver (Filing No. 80). On December 8, 2015, the Court denied Signature's motion (Filing No. 29) to dismiss(Filing No. 85). On April 21, 2016, the Court granted plaintiff's application (Filing No. 108) for default judgment against Calissio Resources Group, Inc. (Filing No. 109). On May 23, 2016, the Court granted plaintiff's motion (Filing No. 94) to compel TDAC “to produce documents and things responsive to [plaintiff's] subpoena served on or about December 4, 2015.” (Filing No. 116).

         On August 2, 2016, the Court granted plaintiff leave to file an amended complaint (Filing No. 122). The amended complaint (Filing No. 123) filed on August 2, 2016, adds the Clearing Firm Defendants as named defendants and alleges the lawsuit was filed “to recover proceeds of a fraudulent dividend scheme . . . that caused harm to COR Clearing and its customers in the amount of approximately $4 million.” (Id. at 1). Plaintiff accuses the Clearing Firm Defendants and Signature of “[i]mproper [r]eceipt and [r]etention of the [f]raudulent [d]ividends.” (Id. at 13). Plaintiff asserts a claim of unjust enrichment against the Clearing Firm Defendants and Signature and asks the Court to “impose a constructive trust . . . over the funds traceable to Calissio's fraud.” (Id. at 19).

         LAW

         Determining whether a complaint states a plausible claim for relief is “a context-specific task” that requires a court “to draw on its judicial experience and common sense.” Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir. 2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678-79, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)). Federal Rule of Civil Procedure 8 requires a complaint to present “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). “[A] complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Braden, 588 F.3d at 594 (quoting Iqbal, 556 U.S. at 678) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (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.” Iqbal, 556 U.S. at 678 (internal cite omitted).

         When considering a motion to dismiss under Rule 12(b)(6), well-pled allegations are considered to be true and are viewed in the light most favorable to the plaintiff. Braden, 588 F.3d at 591, 595. In viewing the facts in the light most favorable to the plaintiff, a court must determine whether the complaint states any valid claim for relief. Jackson Sawmill Co., Inc. v. United States, 580 F.2d 302, 306 (8th Cir. 1978). Recitations of elements of a cause of action with mere conclusory statements fail to meet Rule 8's pleading requirements. Iqbal, 556 U.S. at 678. However, plaintiffs may use legal conclusions to provide the framework of a complaint, so long as factual allegations support those legal conclusions. Id. at 678-79. Thus, a dismissal is likely “only in the unusual case in which a plaintiff includes allegations that show on the face of the complaint that there is some insuperable bar to relief.” Jackson Sawmill, 580 F.2d at 306.

         DISCUSSION

         I. Materials to be Considered

         As an initial matter, the parties disagree about what the Court can, and ought to consider in deciding this joint motion to dismiss. Compare Filing No. 138 at 3, n.2 (“C[OR] was more explicit in its letters to the Clearing Firm Defendants, which were specifically referenced in the Amended Complaint . . . . Since the [p]laintiff specifically references the three letters discussed in the text in its [a]mended [c]omplaint . . . the Court can and should consider those in connection with this [m]otion.”) with Filing No. 149 at 10 (“the Brokerage Defendants' reliance on COR Clearing's demand letter . . . is not appropriately considered on a motion to dismiss . . . .”).

         Federal Rule of Civil Procedure 12(d) provides:

If on a motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are presented to and not excluded by the court, the motion ...

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