UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA ____________________________________ ) CASCINA CA DE LUPIS, ) ) Plaintiff, ) ) v. ) Civil Action No. 07-01372 (RBW) ) CORRADO BONINO, ET AL., ) ) Defendants. ) ) ____________________________________)

Memorandum Opinion

The plaintiff, Cascina Ca de Lupis, S.r.l. (“Cascina”), has filed this lawsuit accusing

defendants Calita Corporation (“Calita”), and Roberto Donna (“Donna”) of Fraud, Conversion,

Conspiracy, and Unjust Enrichment.1 The plaintiff seeks damages in an amount equal to the full

value of the wines that it exported to former defendant Corrado Bonino (“Bonino”), and for

which it did not receive payment. In addition, the plaintiff seeks punitive damages, pre-and post-

judgment interest, costs, and attorney fees. Finally, the plaintiff seeks judicial intervention to

compel the defendants to provide an accurate accounting of their records so that the plaintiff may

review what wines the defendants obtained from the plaintiff, what wines were sold to third

parties, and the funds acquired from those sales. Currently before the Court is defendant

Donna’s motion for dismissal pursuant to Federal Rule of Civil Procedure 12(b)(6) and his

1 Originally, the plaintiff also named the following parties as defendants: Corrado Bonino (“Bonino”), Ena Rita, and Vini, Inc (“Vini”). However, on November 7, 2008, the plaintiff amended its complaint (for the second time), dismissing Ena Rita and Vini from the lawsuit. Approximately three months after the Second Amended Complaint was filed, Bonino was also dismissed by the plaintiff as a defendant to this lawsuit. Despite these dismissals, the plaintiff continues to rest its case on its Second Amended Complaint, which names Bonino as one the defendants. Therefore, the Court notes that whenever the singular term defendant is used throughout this Memorandum Opinion, reference is being made only to Roberto Donna. accompanying Memorandum of Law In Support of Defendant Roberto Donna’s Motion to

Dismiss Under Federal Rule of Civil Procedure 12(b)(6) (Def.’s Mem.).2 The motion is opposed

by the plaintiff. After carefully considering the parties’ submissions, the Court concludes that it

must deny in part and grant in part the defendant’s motion to dismiss.

I. Background

The following facts are alleged in the plaintiff’s Second Amended Complaint (“Am.

Compl.”). From September 2005 through June 2006, the plaintiff, an Italian company that

exports high quality Italian wines to the District of Columbia, employed Corrado Bonino to

assist the plaintiff in the importation and sale of its wines to restaurants in the District of

Columbia and the surrounding area. Am. Compl. ¶¶ 1, 10, 12. During Bonino’s employment, he

contracted with Vini, Inc (“Vini”), a licensed wine importer, to enable the plaintiff’s wines to be

lawfully imported into the United States. Id. ¶ 14. The plaintiff exported wines valued at more

than $600,000 to Bonino, and Bonino, through the Calita Corporation, a corporation organized

and wholly owned by Bonino, then sold and distributed the wines to various purchasers in the

United States. Id. ¶¶ 1, 5, 10, 12. Importantly, most of the wines were purportedly sold and

delivered to the Galileo restaurant, a District of Columbia establishment owned and operated by

defendant Donna. Id. ¶¶ 6, 19.

Sometime on or before December 31, 2005, without the plaintiff’s knowledge or

authorization, Bonino and Donna entered into an agreement which allowed Donna to pay Bonino

less than the amount due for the purchase of the plaintiff’s wines, in return for Bonino

2 The following papers have also been submitted to the Court in connection with this motion: (1) Plaintiff’s Response to Defendant Roberto Donna’s Motion to Dismiss Under Federal Rule of Civil Procedure 12(b)6 (“Pl.’s Opp’n”) and (2) Reply Memorandum to “Plaintiff’s Response to Defendant Roberto Donna’s Motion to Dismiss Under Federal Rule of Civil Procedure 12(b)(6)” (“Def.’s Reply”).

2 continuing to supply the plaintiff’s wines to Donna. Id. ¶¶ 1, 22, 36. Donna would then sell

these wines for a profit at both Galileo and a second restaurant he owned, Trattoria Beppo

(“Trattoria”). Id. ¶¶ 22, 36. Furthermore, Bonino allegedly received an ownership interest in

Trattoria. Id. ¶ 36. Between December 2005 and August 2006, Vini and Bonino provided in

excess of $450,000 of the plaintiff’s wines to Donna for his use at Galileo. Id. ¶ 19. Donna,

aware that the proceeds from the sale of the wines would not be transmitted to the plaintiff,

issued a series of checks payable to cash to Bonino and the Calita Corporation. Id. ¶¶ 5, 25, 27,

42, 43, 46. The checks issued by Donna to Bonino and Calita totaled $257,900, which was

allegedly substantially less than the value of the wines supplied by the plaintiff to Bonino. Id. ¶¶

26, 42, 46.

Additionally, the plaintiff alleges that between September 2005 and August 2006, Bonino

directed Vini to pay him, through Calita, $57,000 from the sale of the wines , which the plaintiff

should have received. Id. ¶ 28. Bonino represented to Vini that he was forwarding these

payments to the plaintiff, when in fact the payments were retained by Bonino. Id. ¶¶ 29, 30. On

September 27, 2006, upon learning of Bonino’s actions, the plaintiff fired Bonino as its

consultant and subsequently filed this lawsuit. Id. ¶ 32.

At the time of filing this complaint, the plaintiff alleged that it had been paid only

$185,849 for the wines that were exported to the United States, leaving an outstanding balance

of $415,666.80. Id. ¶ 11.

3 II. Standard of Review

A motion to dismiss under Federal Rule of Civil Procedure “12(b)(6) tests not whether

the plaintiff will prevail on the merits, but instead whether the plaintiff has properly stated a

claim” upon which relief may be granted. Woodruff v. DiMario,

(D.D.C.

2000). For a complaint to survive a Rule 12(b)(6) motion, it need only provide “a short and

plain statement of the claim showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2),

which accomplishes the duel objectives of “giv[ing] the defendant fair notice of what the claim

is and the grounds upon which it rests,” Bell Atl. Corp. v. Twombly,

(2007)

(citation omitted). “Although detailed factual allegations are not necessary to withstand a Rule

12(b)(6) motion to dismiss, to provide the grounds of entitlement to relief, [the] plaintiff must

furnish more than labels and conclusions or a formulaic recitation of the elements of a cause of

action.” Hinson ex rel N.H. v. Merritt Educational Ctr.,

(D.D.C. 2007)

(internal quotation marks omitted) (quoting Twombly,

). Or, as the Supreme

Court more recently stated, “[t]o 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.’” Ashcroft

v. Iqbal, ___ U.S. ___,

(2009) (quoting Twombly,

). And,

a claim is facially plausible “when the plaintiff pleads factual content that allows the court to

draw [a] reasonable inference that the defendant is liable for the misconduct alleged.”

(quoting Twombly,

). Moreover, under Rule 12(b)(6), the Court “must treat the

complaint’s factual allegations as true [and] must grant [the] plaintiff the benefit of all

reasonable inferences [that can be derived] from the facts alleged.” Trudeau v. FTC,

(D.C. Cir. 2006) (internal quotation marks and citation omitted). Finally, in resolving a

4 Rule 12(b)(6) motion, the Court may consider only the factual allegations set forth in the

complaint, any documents attached as exhibits with the complaint (or incorporated into the

complaint), and matters subject to judicial notice. EEOC v. St. Francis Xavier Parochial Sch.,

(D.C. Cir. 1997). The Court’s focus is therefore restricted to the facts as

alleged by the plaintiff[], which must be sufficient “to raise a right to relief above the speculative

level.” Twombly,

.

III. Analysis

As an initial matter, defendant Donna argues that because the plaintiff fails to allege that

“Donna in his personal capacity, did, or could have, directly contracted with [the p]laintiff for

the importation of the wine[s],” the plaintiff is unable to support any of his claims for relief

against Donna, Def.’s Mem. at 6, and all claims against him must be dismissed, Id. at 5.

Specifically, the defendant states that because he is not licensed to import wine as required by

(a) (2001), he “could not have lawfully purchased and resold the wine[s] in

question[, and instead posits that t]he wine[s] could only have been lawfully purchased and

resold by SER Corporation,” which was doing business as Galileo, or the wine importer, Vini,

Inc.

. Consequently, because SER Corporation and Vini are not parties to this action and

the defendant Donna “could not incur any legal obligation or duty to pay for the wine[s] [in his

personal capacity],” defendant Donna argues that the plaintiff has failed to satisfy the

requirements of Rule 12(b)(6).

. The Court finds the defendant’s arguments

unpersuasive.

The District of Columbia Circuit held that a complaint should not be dismissed for failure

to state a claim unless it appears beyond doubt that the “plaintiff can prove no set of facts in

5 support of his claim which would entitle him to relief.” Browning v. Clinton,

(D.C. Cir. 2002) (quoting Conley v. Gibson,

(1957)). Accordingly, a court

will construe a complaint “liberally in the plaintiff[‘s] favor, and . . . grant [the] plaintiff[] the

benefit of all inferences that can be derived from the facts alleged”. Kowal v. MCI Commc’ns

Corp.,

(D.C. Cir. 1994) (internal citations omitted).

Here, the claims being asserted by the plaintiff do not question the propriety of the

importation of the wines, but instead focus upon the circumstances under which the wines were

sold after its importation. Am. Compl. ¶¶ 22, 36, 60, 66, 72. Therefore, defendant Donna’s

general challenge to the complaint is inapplicable to the present circumstances because his

(a) challenge has no bearing on whether he is liable based on the claims asserted

by the plaintiff, and so long as the plaintiff’s complaint alleges facts which would entitle him to

relief, the defendant’s motion to dismiss must be denied. Accordingly, the Court will proceed to

examine whether the plaintiff has met its burden under each count asserted in its Second

Amended Complaint.

A. The Plaintiff’s Fraud Claim

The defendant argues that the plaintiff “fails to plead with sufficient particularity all the

required elements for a claim for fraud.” Def.’s Mem. at 8. In support of this position, the

defendant posits that “the Second Amended Complaint fails to sufficiently allege that [the

defendant’s] allegedly false representation [to the plaintiff that all of the wines were exclusively

being used by him at Galileo] was given with an intent to deceive, concerned a material fact, and

that [the plaintiff] took action in reliance thereupon.”

Notably, the defendant fails to address,

in both his motion to dismiss and his reply to the plaintiff’s opposition, the plaintiff’s claim

6 regarding Bonino’s false representations to the plaintiff that “all monies obtained for the sale of

Cascina wine[s] in the United States would be and were being forwarded to Cascina,” Am.

Compl. ¶ 20, a statement Donna allegedly knew was false.

.

The plaintiff counters that it has satisfied the pleading requirements by adequately

identifying the alleged perpetrator of the fraud, when the fraudulent statements were made, the

nature of the statements, and what injury the plaintiff sustained as a result of the statements.

Plaintiff’s Response to Defendant Roberto Donna’s Motion to Dismiss Under Federal Rule of

Civil Procedure 12(b)6 (“Pl.’s Opp’n”) at 3.3 The plaintiff asserts that the fraud claim against

Donna stems from his role in the conspiracy with Bonino to defraud the plaintiff, thus, rendering

Donna liable for Bonino’s fraudulent statements and actions.

As additional support for its

fraud claim, the plaintiff alleges that Bonino is a long time friend and confidant of Donna, Am.

Compl. ¶ 7, Bonino and Donna allegedly have a longstanding business relationship with each

other “in conjunction” with both Galileo and Trattoria, and “Calita’s principal place of business

is listed as Galileo Restaurant.”

Therefore, the plaintiff argues that “liability for fraudulent

statements made by Bonino can be imposed on [the defendant].” Pl.’s Opp’n at 4.

The defendant responds that the plaintiff is seeking to solve the defects in his fraud claim

by improperly interweaving it with its conspiracy claim. Reply Memorandum to “Plaintiff’s

Response to defendant Roberto Donna’s Motion to Dismiss Under Federal Rule of Civil

Procedure 12(b)[(6)]” (Def.’s Reply) at 2-3. The defendant also asserts that the plaintiff’s

arguments are insufficiently supported and inaccurate, which he contends further “highlights the

3 The Court notes that the plaintiff failed to number the pages of his opposition, therefore, the Court has taken the liberty of assigning page numbers to it based on the order in which they were submitted to the Court.

7 deficiencies in [the plaintiff’s] Second Amended Complaint.”

For the following reasons, the

Court disagrees with the defendant.

To prevail on a claim of fraud, the plaintiff must establish that there was “(1) a false

representation (2) made in reference to a material fact, (3) with knowledge of its falsity, (4) with

the intent to deceive, and (5) an action that is taken in reliance upon the representation.” Pearson

v. Chung,

(D.C. 2008) (internal quotation marks and citation omitted).

Additionally, “the plaintiff must also have suffered some injury as a consequence of his reliance

on the misrepresentation.” Chedick v. Nash,

(D.C. Cir. 1998) (internal

citation omitted). “A false representation is ‘an assertion not in accord with the facts[,’ including

t]he concealment of a fact that should have been disclosed.” Sage v. Broad. Publ’ns, Inc.,

(D.D.C. 1998) (internal citation omitted). “[The] materiality requirement is met if

the matter at issue is ‘of importance to a reasonable person in making a decision about a

particular matter or transaction.’” U.S. v. Philip Morris USA Inc.,

(D.C.

Cir. 1996) (internal citation omitted).

Furthermore, a person who “is not a party to the transaction into which the complainant is

induced” may also be charged with fraud, “particularly where such third person profits from the

fraud and retains the benefits thereof.” 37 Am. Jur. 2d Fraud and Deceit § 304 (2010). In other

words, “[a] transaction is not purged of fraud by showing that it was brought about by a third

person.” Id.; accord Abrams v. Roseth Corp.,

(N.Y. App. Div. 1937)

(holding that when third-party defendants “joined with the defendants . . . in said fraud and

deprived the plaintiff of his commissions [and] kept and received the benefits of the services

rendered by the plaintiff[, the third-party defendants are] participants with the defendant[s] . . . in

8 the alleged acts of fraud.”).

Finally, Rule 9(b) requires that a pleader state with particularity the circumstances

constituting fraud or mistake. Fed. R. Civ. P. 9(b). Another member of this Court in In re U.S.

Office Products Security Litigation, articulated the Rule 9(b) standard as follows:

Because the rule is chiefly concerned with the elements of fraud, the circumstances that the claimant must plead with particularity include matters such as the time, place, and content of the false misrepresentations, the misrepresented fact, and what the opponent retained or the claimant lost as a consequence of the alleged fraud. (emphasis added) In other words, Rule 9(b) requires that the pleader provide the who, what, when, where, and how with respect to the circumstances of the fraud. That said, Rule 9(b)’s particularity requirement does not abrogate Rule 8's general requirements that a pleading contain a short and plain statement of the claim, and that each averment be simple, concise, and direct. Rule 9(b) simply requires the pleader to provide a higher degree of notice by adequately alleging all of the requisite elements for the cause of action invoked. Finally, [c]onclusory allegations that a defendant's actions were fraudulent and deceptive are not sufficient to satisfy 9(b).

, 73-74 (D.D.C. 2004) (internal citations omitted); Bamba v. Resource Bank,

(D.D.C. 2008) ( “One [who] plead[s] fraud must allege … facts as will

reveal the existence of . . . the . . . elements of fraud. Facts which will enable the court to draw

an inference of fraud must be alleged, and [conclusory] allegations . . . on the part of the pleader

as to the existence of fraud are insufficient.”) (internal citations omitted). Upon review of the

plaintiff’s complaint, the Court finds that the plaintiff’s fraud claim satisfies the requisite

pleading standard.

The plaintiff sufficiently alleges that Bonino and the defendant made two false

representations in carrying out their scheme. First, the plaintiff posits that Bonino falsely

represented to the plaintiff that “all monies he obtained for the sale of Cascina wine[s] in the

United States would be would be remitted to Cascina,” Am. Compl. ¶ 13; see also id. ¶¶ 17, 20,

when Bonino was instead “causing and directing defendant, Roberto Donna and the wine

9 importer . . . to make payments to him [rather than to the plaintiff],” id. ¶ 21, which Bonino

deposited “into [his] Bank of America account . . . and thus converted them to his own use, id. ¶

30.” Second, the plaintiff alleges that Bonino and the defendant told him that “all wines sold to

[the defendant] were to be used at Galileo, only, and not at [Trattoria],” id. ¶ 24, when the

defendant was instead “divert[ing] some of the wine[s] to [Trattoria] and . . . not utiliz[ing them]

at Galileo,” id. ¶ 50. Although the plaintiff does not assert that Donna was the person who made

the false representations to the plaintiff on the occasions just mentioned, the plaintiff does allege

that the defendant became aware of Bonino’s false representations and took advantage of them to

his benefit, with knowledge of the circumstances. Id. ¶¶ 22, 42. The complaint also provides

either the exact or approximate dates of the activities that support its fraud claim, id. ¶¶ 10, 12,

14, 18, 19, 20, 22, 25, 28, 32, along with the approximate value of the wines it exported, which

are the subject of this lawsuit. Id. ¶¶ 10, 11, 19, 39, 40. Additionally, the complaint identifies

various banking transactions between the defendant, Bonino, and Vini. Id. ¶¶ 25, 26, 27, 28, 30,

44, 45. Finally, the complaint asserts that a longstanding professional relationship existed

between Bonino and Donna, specifically that Calita’s principle place of business is listed as the

Galileo restaurant. Id. ¶ 7. Accordingly, accepting the plaintiff’s allegations as true and because

a third party who profited from a transaction in which he knew the plaintiff was induced through

false representations can be held liable for the underlying fraud, Abrams,

, the

plaintiff has satisfied the first element necessary to assert a claim of fraud with the requisite

degree of particularity.

The materiality element has also been sufficiently pled because it is alleged that the false

representations induced the plaintiff to continue conducting business with Bonino and the

10 defendant. Am. Compl. ¶¶ 37, 49, 51-52. If the plaintiff had known that Bonino was selling the

plaintiff’s wines for less than the market price to the defendant and that Bonino was not

remitting all of the money from the sales to the plaintiff, the plaintiff would have certainly

terminated Bonino’s employment, and in fact, the plaintiff terminated Bonino when the false

representations came to light. Id. ¶ 32. Therefore, because a reasonable jury could find that the

false representations affected the plaintiff’s decision to retain Bonino as an employee, the false

representations were material. See Philip Morris USA Inc.,

(holding that

the risks involved with cigarette smoking were material because “each [risk] concern[ed] direct

and significant consequences of smoking” and as such “[was] an important consideration for a

reasonable person”).

The third element is also be satisfied because the complaint asserts that Bonino and the

defendant knew that their representations to the plaintiff were false. Id. ¶¶ 15, 20-21, 49-50. In

addition, the fourth element of the claim is met by the plaintiff’s allegation that Bonino and the

defendant intended their false representations to deceive the plaintiff because their access to the

plaintiffs’s wines was necessary to continue their scheme. Id. ¶¶ 22, 36. Lastly, the fact that the

plaintiff relied upon these false representations to its detriment is evident, given that from

September 1, 2005 until September 27, 2006, the plaintiff continued to employ Bonino, which

enabled him to supply Donna with the plaintiff’s wines at below market prices. Id. ¶¶ 12-31.

This reliance resulted in the plaintiff supplying wines valued at $415,666.80 to the defendant

without receiving full remittance in return. Id. ¶ 11. Therefore, because the allegations in the

complaint satisfy all of the elements of a claim for fraud, the Court must deny the defendant’s

motion to dismiss this count of the complaint.

11 B. The Plaintiff’s Conversion Claim

Defendant Donna seeks dismissal of the plaintiff’s conversion claim on several grounds.

First, he posits that the plaintiff is seeking to enforce an obligation to pay a debt and “the use of a

conversion claim to accomplish this recovery is [in]appropriate.” Def.’s Mem. at 9-10. Donna

also argues that since the wines were lawfully obtained, the claim for conversion must be

dismissed because the plaintiff does not allege that a demand was made for the allegedly

converted property in order to show adverse possession. Id. at 10. Third, he maintains that any

lawsuit for conversion against him in his personal capacity is improper because there has been

no allegation by the plaintiff that there was an agreement between him and the plaintiff in his

personal capacity. Id.; Def.’s Reply at 5. Moreover, the defendant advances the notion that

since the wine importer was the entity that imported and sold the wines to him, that it possessed

title to the wines when he acquired them, and therefore, the plaintiff had no property interest in

the wines at the time of his acquisition, only a contractual right to be paid for the wines by the

importer. Def.’s Reply at 5 n.3. Donna further argues that the conversion claim should be

dismissed because the plaintiff does not sufficiently identify what property Donna is exercising

dominion over. Def.’s Mem. at 10; Def.’s Reply at 5. Finally, he posits that “if [he] resold the

wine[s], he cannot be liable for conversion.” Def.’s Mem. at 10; Def.’s Reply at 5. Donna

contends that for all of these reasons, the plaintiff has failed to state a claim for fraud.

The plaintiff responds that its Second Amended Complaint sufficiently alleges that

Donna unlawfully “converted [the p]laintiff’s property . . . for his own use[].” Pl.’s Opp’n at 6.

It contends that the money in question is not a debt but rather a specifically identified sum of

money, representing the aggregate value of the wines that was fraudulently withheld from the

12 plaintiff, and as such is recoverable under a theory of conversion. Id. at 6-7. Furthermore, the

plaintiff asserts that it is not required to make a demand for the return of the wines because

Donna’s possession of the wines was unlawful in the first instance. Id. at 6. According to the

plaintiff, Donna and Bonino illegally obtained the wines by defrauding the plaintiff, id., and then

illegally obtained the money earned by selling the wines without compensating the plaintiff for

them, id.

“Under D.C. law, an action for conversion is recognized only when a defendant has

unlawfully exercised ‘ownership, dominion or control over the personal property of another in

denial or repudiation of his rights thereto.’” Kaempe v. Myers,

(D.C. Cir.

2004) (citing Shea v. Fridely,

(D.C. 1956)); Morgan v. Berry, 12 F. App’x. 1,

5 (D.C. Cir. 2000); Curaflex Health Servs., Inc. v. Bruni,

(D.D.C. 1995).

Therefore, “[w]here there has been no dispossession of property rights, there can be no action for

conversion.” Kaempe,

. However, “[a] plaintiff need only aver title or ownership

in himself to support a cause of action for conversion.” R.A. Weaver & Assocs., Inc. v. Haas &

Haynie Corp.,

, 173 n.43 (D.C. Cir. 1980). It must be noted at this point that a

proprietary interest in property is different than a contractual right to payment for the property

and merely because a breach of contract has occurred does not preclude a plaintiff from pursuing

a conversion claim. See id. at 173. (holding that a contractor has both an ownership interest in

its drawings and contractual right for payment for the production of the drawings). But, where

the initial possession is lawful, a demand for return of the property is necessary to establish a

claim of conversion. Furash & Co. v. McClave,

(D.D.C 2001); Shulman

v. Voyou, L.L.C.,

(D.D.C. 2003) (quoting Shea v. Fridley,

358, 361 (D.C. 1956) (noting that when the initial possession is lawful a demand for the return of

the property is necessary to render possession unlawful and to demonstrate its adverse nature).

Furthermore, “[m]oney can be the subject of a conversion claim only if the plaintiff has the right

to a specific identifiable fund of money.” Curaflex Health Servs., Inc. v. Bruni,

(D.D.C. 1995) (dismissing the plaintiff’s claim of conversion because his right to possession

or control of the funds was contingent on the defendant’s instruction to the bank to transfer the

funds, which the defendant never requested) (citing Scherer v. Laborers’ Int’l Union of N. Am.,

(N.D. Fla. 1988) (granting summary judgment on the plaintiff’s conversion

claim because she had no right to possession of money, but had at best, an unsecured lien on the

property with no right to possession)). A cause of action for conversion, however, may not be

maintained to enforce a mere obligation to pay money.

see also Choharis v. State Farm Fire

& Cas. Co.,

, 1089 & n.13 (D.C. 2008) (“Failure by a contracting party to pay the

contract price or debt . . . is not conversion but merely breach of contract.”). The Court will

assess below whether the plaintiff has satisfied these pleadings requirements.

1. Wrongful Exercise of Ownership Over the Personal Property of Another

The plaintiff has alleged that Donna obtained its wines by the use of fraudulent

misrepresentations. Am. Comp. ¶ 52. Because the plaintiff is alleging that the initial possession

of the wines was unlawful, there is no requirement that a demand be made for the proceeds from

the sale of the wines to successfully assert a conversion claim. Shea,

(intimating that if the initial possession of the property in dispute is unlawful, a demand is not

necessary as the adverse nature of the possession would appear self evident). Further, as

admitted by the defendant, there was no contractual relationship between him and the plaintiff.

14 Def.’s Mem. at 10. On the one hand, the defendant argues that the plaintiff’s conversion claim

actually constitutes a contract dispute in disguise, while also arguing that he cannot be held

liable for conversion because there was no contractual relationship between him and the plaintiff.

Def.’s Reply at 4-5. The defendant cannot have it both ways. There being no contract between

the parties, the Court does not see how the plaintiff is attempting to enforce an obligation to pay

for the wines through utilization of a conversion claim. Rather, the plaintiff has alleged that it is

entitled to an identifiable sum of money represented by the proceeds acquired from the sale of its

wines. Pl.’s Opp’n at 6-7. As the plaintiff points out, this money is not representative of a debt

owed, but is instead a specific amount of money that the plaintiff alleges has been wrongfully

retained by the defendant. Id. at 7. Therefore, because the plaintiff has pled facts sufficient to

show that the proceeds acquired from selling its wines were unlawfully retained, and the funds in

question represent an identifiable sum of money, the Court is satisfied that the plaintiff has

sufficiently pled this element of his claim for conversion.

2. Repudiation of the Owner’s Rights

In order to support a claim for conversion, the plaintiff must show that the defendant

interfered with the plaintiff’s control of the property “so seriously” that the defendant “may

just[ifiably] be required to pay the [plaintiff for] the full value of [its wines].” Blanken v. Harris,

Upham & Co.,

(D.C. 1976) (quoting Restatement (Second) of Torts §

222(A)(1) (1965)). In R.A. Weaver, 663 F.2d at 171-72, the defendants received a credit for

architectural drawings that belonged to the plaintiffs and retained the benefit from the recipient

of the credit. The District of Columbia Circuit upheld a jury verdict that awarded compensatory

and punitive damages based on a finding that the defendant had converted the plaintiffs’

15 drawing. Id. at 173. The court found that selling the drawings and keeping the proceeds

represented a denial and repudiation of the plaintiffs’ rights to the drawings. Id. The current

case presents circumstances similar to those in R.A. Weaver. Specifically, the defendant is

accused of fraudulently acquiring wines that belonged to the plaintiff and then failed to forward

the proceeds from the sale of the wines to the plaintiff. Pl.’s Opp’n at 6-7. If true, these

allegations would constitute interference with the plaintiff’s right to the proceeds from the sale of

its wines. The plaintiff has therefore set forth allegations in the Second Amended Complaint that

would allow a jury to infer that the defendant’s control over the plaintiff’s property—selling the

wines and retaining the proceeds—seriously interfered with the plaintiff’s rights to the proceeds

acquired from the sale of the plaintiff’s wines. Additionally, the Court finds that the plaintiff has

satisfied the pleading requirements for its conversion claim.

C. The Plaintiff’s Conspiracy Claim

The defendant next challenges the plaintiff’s conspiracy claim, arguing that “it is nothing

more than [a] derivative of the fraud and conversion counts.” Def.’s Mem. at 11. He further

contends that “the allegations proffered in support of the conspiracy count are internally

inconsistent because they allege that Donna personally obtained wine[s] from [the plaintiff] even

though the agreement for the importation of the wine[s] was . . . between [the plaintiff] and its

importer . . . not Donna.” Id. Therefore, the defendant concludes that the conspiracy count must

be dismissed because the plaintiff fails to allege that the defendant was the person that

committed a wrongful act in furtherance of a common scheme, and thus has not properly

“alleged [an] underlying tort(s).” Id. The plaintiff responds by arguing that the conspiracy and

fraud claims necessarily support one another, opining that “[o]nce Mr. Donna enter[ed] into a

16 conspiratorial agreement with Bonino to defraud [the plaintiff], each conspirator be[came] liable

for the acts of one another in furtherance of the conspiracy.” Pl.’s Opp’n at 4. Specifically, the

plaintiff alleges that Donna became a coconspirator when he “agree[d] to pay for Cascina’s

wine[s] from Bonino and direct[ed] his payments to Bonino in cash through hidden accounts,”

id., listing multiple occasions when Bonino and the defendant made false representations to the

plaintiff, id. at 4-5.

In the District of Columbia, civil conspiracy consists of four elements: “‘(1) an

agreement between two or more persons; (2) to participate in an unlawful act, or a lawful act in

an unlawful manner; (3) an injury caused by an unlawful overt act performed by one of the

parties to the agreement; (4) which overt act was done pursuant to and in furtherance of the

common scheme.’” Second Amendment Found. v. U.S. Conf. of Mayors,

(D.C. Cir. 2001) (quoting Halberstam v. Welch,

(D.C. Cir. 1983)). See

also Sturdza v. Gov’t of the United Arab Emirates,

(D.C. Cir. 2002) (“In

the District of Columbia, ‘a cause of action for civil conspiracy must allege the formation and

operation of the conspiracy, wrongful acts done in furtherance of the common scheme, and

damages suffered as a result.’”) (quoting Higgs v. Higgs,

(D.C. 1984)). For

the following reasons, the Court concludes that the plaintiff’s conspiracy claim survives the

defendant’s motion to dismiss.

1. An agreement between two or more persons

In order to show a conspiracy the plaintiff must first allege a “single plan, the essential

nature and general scope of which [were] known to each person who is to be held responsible for

its consequences.” Hobson v. Wilson,

(D.C. Cir. 1984) (alteration in original)

17 (quoting Hampton v. Hanrahan,

(7th Cir. 1979)). However, while “[t]he

conspirators ‘must share the general conspiratorial objective, . . . they need not know all the

details of the plan . . . or possess the same motives.’”

(quoting Hampton,

).

Even when a conspiracy claim against an alleged tortfeasor is dismissed, the actions of that

individual may still be considered in assessing whether a conspiracy claim has been adequately

pled. See Dennis v. Sparks,

(1980) (explaining that although “the judicial

immunity doctrine required dismissal of the § 1983 action against the judge who issued the

challenged injunction . . . [, i]t does not follow . . . that the action against the private parties

accused of conspiring with the judge must also be dismissed”); accord United States v. Dakins,

(D.C. Cir. 1989) (finding that even “if charges are dismissed against all

other coconspirators . . . dismissal of charges against the remaining conspirator is not required”)

(quoting United States v. Sachs,

(6th Cir. 1986)). Therefore, so long as the

plaintiff has sufficiently alleged that a tort has been committed and satisfies all the elements of a

conspiracy, the conspiracy claim survives even though the claim has been dismissed against the

other alleged tortfeasor. Dennis,

.

Here, the plaintiff alleges that Bonino misrepresented to the plaintiff that he was a loyal

and trustworthy employee while he was actually involved in a scheme to sell the plaintiff’s

wines to Donna for below market prices, deposit those funds into his personal account, and then

fail to remit those funds to the plaintiff. Because it has been alleged that Bonino committed

several torts and that defendant Donna conspired with him in the commission of those acts, the

plaintiff may maintain the conspiracy claim against Donna even though Bonino has been

dismissed as a party in this action, so long as a conspiracy claim is otherwise adequately pled.

18 See Dennis,

. And the Court finds that this has been accomplished. The plaintiff

explicitly alleges an agreement between Bonino and Donna in the complaint. Am. Compl. ¶ 22.

Specifically, he contends that Donna and Bonino agreed that Donna would pay Bonino a portion

of the money owed to the plaintiff for the imported wines and in return Bonino would ensure that

the plaintiff continued to provide the plaintiff’s wines to Donna at a reduced price not authorized

by the plaintiff. Id. ¶¶ 22, 41-42. The plaintiff amply supports these allegations by placing in

the record a list of transfers of wines and their monetary value. Id. ¶ 39. The plaintiff further

alleges that Donna agreed to employ Bonino at Donna’s restaurant Trattoria and give Bonino an

ownership interest in that restaurant. Id. at ¶ 23. Accordingly, the plaintiff has satisfied the first

element required to establish a civil conspiracy.

2. Participation in an unlawful act, or a lawful act in an unlawful manner

“Under District of Columbia law, ‘[c]ivil conspiracy is not an independent tort but only a

means for establishing vicarious liability for an underlying tort.’ A claim for civil conspiracy

thus fails unless the elements of the underlying tort are satisfied.” Nader v. Democratic Nat’l

Comm.,

(D.C. Cir. 2009) (internal quotations and citation omitted). A

conspiracy claim spreads liability for a successful tort claim to all parties to the conspiracy

regardless of wether they actually committed the underlying tortious act.

See also

Halberstam,

(“A conspirator need not participate actively in or benefit from the

wrongful action in order to be [held] liable.”). Here, the plaintiff’s conspiracy claim hinges on

its claims for fraud and conversion. And as concluded earlier in this Opinion, infra at 6-16, the

plaintiff has successfully pled claims for fraud and conversion against Donna. Thus, if the

plaintiff successfully proves a claim of fraud or conversion against Bonino, Donna could also be

19 held liable for fraud and conversion based on the theory that he was Bonino’s coconspirator.

Nader,

.

Regarding its claim of fraud, the plaintiff contends that Bonino represented to it that he

would work as its United States sales representative and that any proceeds he obtained from the

sale of its wines would be remitted to the plaintiff. Am. Compl. ¶ 13. The plaintiff contends that

it relied on these representations in continuing to provide the wines to Bonino and Donna. Pl.’s

Opp’n at 5. The plaintiff also alleges that Donna and Bonino knew the falsity of these

statements when made.

Finally, the plaintiff asserts that it is currently owed $415,666.80 for

the wines, which represents the value of the wines entrusted to Bonino and the injury it suffered

as a result of the underlying fraudulent conduct. Am. Compl. ¶ 11.

In support of its conversion claim, the plaintiff asserts that Bonino and Donna wrongfully

obtained possession of its wines through the use of fraudulent misrepresentations, id. ¶¶ 41-42,

52, sold the plaintiff’s wines for substantially below market prices, id. ¶¶ 41-42, 55-56, and

failed to forward the proceeds of the sale to the plaintiff, id. The plaintiff concludes that based

on these actions, it is entitled to an identifiable sum of money that Bonino and Donna have

improperly withheld. Pl.’s Opp’n at 6-7.

Given that the Court has determined that the plaintiff has successfully pled the existence

of an agreement between Donna and Bonino, the plaintiff’s fraud and conversion claims provide

the underlying basis for its theory of conspiracy liability. Nader,

.

3. An injury caused by an unlawful overt act performed by one of the parties to the agreement

As previously stated, the Court finds that the plaintiff has successfully pled that it

sustained an injury caused by the actions of one of the parties to the alleged agreement between

20 Donna and Bonino. Having asserted that it relied on misrepresentations by both the defendant

and Bonino as the basis for continuing to provide its wines to Bonino, Am. Compl. ¶¶ 13, 17, 20-

22, 24, 47, 49-52,54-57; Pl.’s Opp’n at 5, and having alleged that it is owed the balance of

$415,666.80 for the wines that was the object of the underlying tortious conduct, Am. Compl. ¶¶

11, 19, 39-40, 65, the injury requirement for a conspiracy claim has been properly pled.

4. An overt act done pursuant to and in furtherance of the common scheme

The Court finds that the plaintiff has alleged that an overt act was done by a member of

the conspiracy in furtherance of the conspiracy. The plaintiff asserts allegations against the

defendant and Bonino personally that go to the very heart of the conspiracy. Specifically, the

plaintiff contends that the defendant and Bonino engaged in a conspiracy under which they

would obtain the wines from the plaintiff without paying the full value. Am. Compl. ¶ 22. The

plaintiff further alleges that through the use of numerous misrepresentations, the defendant and

Mr. Bonino received its wines without remitting full payment for the wines. Id. at ¶¶ 13-17.

These allegations are sufficient to satisfy the overt act component of a conspiracy claim.

Moreover, even if these allegations were insufficient to show that an overt act was committed by

the defendant personally, the overt act element of a conspiracy claim is satisfied whenever “an

injury caused by an unlawful overt act [is] performed by one of the parties to the agreement . . .

pursuant to and in furtherance of the common scheme.” Second Amendment Found.,

(emphasis added). For example, in Halberstam, the District of Columbia Circuit held that a

coconspirator was liable for the acts of his partner who murdered another man during a burglary

even though the coconspirator did not plan or know about the “particular overt act” that his

partner committed which caused the injury because “the purpose of the act was to advance the

21 overall object of the conspiracy.”

. Moreover, the court found that the overt act

“was a reasonably foreseeable consequence of the scheme.”

Therefore, because here the

plaintiff contends that the defendant entered into an agreement with Bonino with knowledge that

Bonino was making false representations to the plaintiff in furtherance of a scheme to defraud

the plaintiff, the defendant would be liable for all qualifying overt acts committed by Bonino.

Therefore, the overt act element of a conspiracy claim as to the defendant has been adequately

pled by the plaintiff.4

D. The Plaintiff’s Unjust Enrichment Claim

Donna contends that the plaintiff’s claim for unjust enrichment against him should be

dismissed because its complaint fails to allege that “Donna, in his personal capacity, was a party

to any agreement with [the] plaintiff in which [the] plaintiff . . . confer[red] a benefit on Donna.”

Def.’s Mem. at 12. In other words, Donna asserts that because the agreement here conferred a

benefit to a third person, not Donna, the plaintiff cannot maintain an unjust enrichment claim

against him. However, the plaintiff counters that it indirectly conferred a benefit on Donna by

supplying him with its wines through Bonino, which Donna knowingly acquired for prices

“below the market cost.” Pl.’s Opp’n at 8. Therefore, the plaintiff asserts, Donna unjustly

received the benefit of acquiring its wines without paying the full value for it at the plaintiff’s

expense.

4 The defendant’s argument that he cannot be found liable for conspiracy because the plaintiff did not provide him with its wines in his personal capacity also rings hollow. The plaintiff has alleged sufficient facts to support a conspiracy claim against Donna in his personal capacity because of his alleged agreement with Bonino. Thus, even if Donna was acting as the agent of a business, he would still be liable for any torts that he personally committed. Oriental Trading Co. v. Firetti,

(8th Cir. 2001) (holding that defendants could be found personally liable even if they were acting as agents within the scope of their employment).

22 Unjust enrichment occurs when: (1) the plaintiff confers a benefit on the defendant; (2)

the defendant retains the benefit; and (3) under the circumstances, the defendant’s retention of

the benefit is unjust. New World Commc’ns, Inc. v. Thompsen,

(D.C.

2005). The District of Columbia recognizes unjust enrichment as a species of quasi contract

doctrine that imposes, “in the absence of an actual contract, . . . a duty . . . upon one party to

requite another in order to avoid the former's unjust enrichment [,] . . . [and therefore] to permit

recovery by contractual remedy in cases where, in fact, there is no contract.” 4934, Inc. v. D.C.

Dep't of Employment Servs.,

(D.C. 1992) (“From the beginning a quasi-contract

has been openly acknowledged to be a [l]egal fiction invented by common law courts to permit

recovery by contractual remedy in cases where, in fact, there is no contract, but where

circumstances are such that justice warrants a recovery as though there had been a promise . . . .

It is . . . founded on considerations of justice and equity, and on [the] doctrine of unjust

enrichment.”).

The Court finds that the challenge to the plaintiff’s unjust enrichment claim advanced by

the defendant is baseless. The defendant mistakenly asserts that because the actual agreement

concerning the importation of the plaintiff’s wines was with a third party and conferred no

benefit to him, he cannot be held liable to the plaintiff on an unjust enrichment theory. His

position is flawed due to the essence of the unjust enrichment doctrine, which operates from the

premise that an actual contract is lacking, but nonetheless provides an avenue for relief to avert

an injustice. 4934, Inc.,

(holding that an employee was unjustly enriched by

receiving double indemnifications for his injuries and he was therefore ordered to relinquish one

of the payments because it was unfair and unjust to allow him to retain both). Thus, although the

23 plaintiff’s complaint does not allege the existence of an agreement between Donna and the

plaintiff, that does not defeat the plaintiff’s claim that Donna was unjustly enriched at the

plaintiff’s expense. The Court therefore finds that the plaintiff’s complaint sufficiently provides

the defendant with adequate notice of the claim in dispute, and adequately alleges facts in

support of its claim that Donna knowingly, unjustly, and indirectly acquired a financial benefit

from the sale of the plaintiff’s wines for which the plaintiff has not been reimbursed. Am.

Compl. ¶¶ 22, 65. Accordingly, accepting as accurate the factual allegations in the complaint, as

the Court must at the pleading stage, Kowal,

, the plaintiff’s claim of unjust

enrichment survives the defendant’s 12(b)(6) motion to dismiss.

E. The Plaintiff’s Request for an Accounting

The plaintiff has requested an accounting to disclose what wines the defendant and

Bonino obtained from the plaintiff, what wines they sold to third parties, and what funds they

received from the proceeds of such sales. Am. Compl. ¶¶ 72-73. Donna argues that due to the

absence of a contract or fiduciary relationship between him and the plaintiff, there is no

justification to require he provide an accounting to the plaintiff. Def.’s Mem. at 13. Notably, the

plaintiff has failed to respond to the defendant’s argument. Accordingly, the Court will not

explore the plaintiff’s request for an accounting due to the plaintiff’s failure—in its

opposition—to address the defendant’s arguments challenging the plaintiff’s request for an

accounting. In accordance with prevailing case law in this Circuit and this Court’s Local Civil

Rule 7.1(b), “when a plaintiff files a response to a motion to dismiss but fails to address certain

arguments made by the defendant, the court may treat those arguments as conceded, even when

the result is dismissal…” (Fox v. Am. Airlines, Inc., No. 02-CV-2069 (RMU),

21854800, at *2 (D.D.C. Aug. 5, 2003) (citations omitted). The Court opts to invoke this

authority and therefore the plaintiff’s claim for an accounting is dismissed.

F. Punitive Damages

In response to the plaintiff’s request for punitive damages based on its claims of fraud,

conversion, and conspiracy, the defendant argues that the allegations in the complaint do not rise

to the level required to merit an award of punitive damages and that the claim should be

dismissed. Def.’s Mem. at 13. The plaintiff counters that the Court can infer from the facts

alleged in the complaint that the defendant committed fraud and conversion with actual malice in

willful disregard of the plaintiff’s rights. Pl.’s Opp’n at 9.

The awarding of punitive damages depends on whether the plaintiff can show “by clear

and convincing evidence that the tort [(or torts)] committed by the defendant was aggravated by

egregious conduct and a state of mind that justifies punitive damages.” Johnathan Woodner Co.

v. Breeden,

(D.C. 1995). Since the plaintiff alleges sufficient facts to survive

a motion to dismiss for both its fraud and conversion claims, which are intentional torts, the

claim for punitive damages will not be dismissed, Butera v. District of Columbia,

(D.C. Cir. 2001) (“In the District of Columbia, with rare exceptions, punitive damages

[against individuals] are available . . . for intentional torts.”) (internal citations and quotation

marks omitted), due to the nature of the allegations levied against the defendant. Feltman v.

Sarbov,

(D.C. 1976) (“[An award of punitive damages] is proper only when

the tort is aggravated by evil motive, actual malice, deliberate violence or oppression.”) (internal

citations and quotation marks omitted). Specifically, the plaintiff contends that Donna acquired

its wines from Bonino with the full knowledge that the plaintiff would not be equitably

25 compensated. Am. Compl. ¶ 36. Moreover, the plaintiff further asserts that the defendant made

false statements to the plaintiff for the purpose of obtaining the wines from the plaintiff. Id. at ¶¶

49-52. The Court is satisfied that these allegations, if proven true, could support a finding by a

jury that the defendant’s conduct was sufficiently egregious and committed with the requisite

scienter to warrant a punitive damages award.5

IV. Conclusion

For the foregoing reasons, the defendant’s Rule 12(b)(6) motion to dismiss to is denied

with respects to Counts I, II, III of the complaint and the plaintiff’s demand for punitive

damages. However, the defendant’s motion to dismiss is granted with respect to Count IV of the

complaint.

SO ORDERED.6

REGGIE B. WALTON United States District Judge

5 If this matter ultimately proceeds to trial, the Court will evaluate at the conclusion of the presentation of all the evidence whether the proof merits the jury being permitted to consider an award of punitive damages. 6 An Amended Order is being issued contemporaneously with this Memorandum Opinion.

26