Icho v. Royal Spring Water et al

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
MEMO RE PLAINTIFF’S MOTION
FOR DEFAULT JUDGMENT 	-1-
UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
In re
ROBERT ISAAC ICHO,
Debtor.
ROBERT ISAAC ICHO,
Plaintiff,
vs.
ROYAL SPRING WATER and
ALEX HAZAN,
Defendants.
____________________________________
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
Case No. 07-31238 TEC
Chapter 11
Adv. Proc. No. 08-3023 TC
MEMORANDUM RE PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT
On May 22, 2008, the court held a status conference in the
above-captioned proceeding. 	Heather A. Cutler appeared for
Plaintiff. 	There were no other appearances. 	At the status
conference, the court set an evidentiary hearing for June 17, 2008
on Plaintiff’s motion for entry of default judgment in the sum of
$1,250,000. 	For the reasons stated herein, the court determines
that an evidentiary hearing on the motion for default judgment is
premature because the complaint fails to state a claim upon which
Signed and Filed: June 05, 2008
________________________________________
THOMAS E. CARLSON
U.S. Bankruptcy Judge
________________________________________
Entered on Docket
June 06, 2008
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 08-03023 Doc# 10 Filed: 06/05/08 Entered: 06/06/08 15:10:40 Page 1 of 4

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
MEMO RE PLAINTIFF’S MOTION
FOR DEFAULT JUDGMENT 	-2-
relief may be granted.
FACTS
The complaint asserts two claims, one for fraud (false
representation), and one for breach of contract. 	The complaint
alleges as follows:
FIRST CLAIM FOR RELIEF
FRAUD
6. 	Plaintiff and defendants did business over a
period of several months, whereby defendants agreed to
provide bottled water to plaintiff.
7. 	The water was not delivered in accordance with
the terms of the contract and in some instances, not at
all. 	Defendants represented to plaintiff that they would
return his money to him, and also give him 750,000 shares
of defendant Royal Water, which shares then had a value
of approximately $1.65 per share, or a total of in excess
of $1.25 million.
8. 	The representations were in fact false. 	None of
the representations respecting the terms and conditions
of the agreement were true. 	Defendants knew that their
statements were false.
SECOND CLAIM FOR RELIEF
BREACH OF CONTRACT
9. 	Defendants represented to plaintiff that they
would give him $1.250 million evidenced by 750,000 shares
of stock on account of his claims, but have not done so.
LAW
The complaint does not state a claim upon which relief may be
granted. 	The complaint does not allege essential elements of a
claim for breach of contract such as whether the contract at issue
was written, oral, or implied (and if the contract was oral, the
consideration paid); Plaintiff’s performance or nonperformance of
the contract; the facts constituting Defendants’ breach; and
whether Plaintiff’s damages were caused by Defendants’ breach.
4 Witkin, Pleading §§ 476-501. 	The complaint fails to allege the
fraud with particularity, and omits essential components of a fraud
claim such as that Defendants’ intended to deceive Plaintiff; that
Plaintiff actually relied on Defendants’ false statements and that
Case: 08-03023 Doc# 10 Filed: 06/05/08 Entered: 06/06/08 15:10:40 Page 2 of 4

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
-3-
such reliance was justifiable; and that damage resulted to
Plaintiff from his justifiable reliance on the false statements. 	5
Witkin, Pleading §§ 668-89; Fed. R. Civ. P. 9(b).
Once a party’s default has been entered, the court has
discretion to grant default judgment against that party. 	Aldabe v.
Aldabe, 616 F.2d 1089, 1092-93 (9th Cir. 1980). 	Default judgment
is not appropriate when the complaint fails to state a claim upon
which relief may be granted. 	E.g. Interscope Records v. Rodriguez,
2007 WL 2408484 (S.D. Cal. 2007).
Accordingly, by separate order, the court vacates the
evidentiary hearing to determine the amount of Plaintiff’s damages
and directs Plaintiff to amend his complaint to state claims upon
which relief may be granted. 	Fed. R. Civ. Proc. 12(b)(6).
**END OF MEMORANDUM**
Case: 08-03023 Doc# 10 Filed: 06/05/08 Entered: 06/06/08 15:10:40 Page 3 of 4

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
-4-
Court Service List
Iain A. Macdonald, Esq.
Heather A. Cutler, Esq.
Macdonald and Associates
221 Sansome Street, Third Floor
San Francisco, CA 94104
Royal Spring Water
Agent for Service of Process
3027 East Sunset Road, Ste. 103
Las Vegas, NV 89120
Alex Hazan
468 North Camden Drive, Ste. 200
Beverly Hills, CA 90210
Case: 08-03023 Doc# 10 Filed: 06/05/08 Entered: 06/06/08 15:10:40 Page 4 of 4