Borrowers' claims against a lender's assignee for violations of the Truth in Lending Act
Overview
Borrowers' claims against a lender's assignee for violations of the Truth in Lending Act (TILA) and Cal. Bus. & Prof. Code Ann. § 17200, the unfair competition law, were barred by the one-year statute of limitations applicable to TILA, 15 U.S.C.S. § 1640(e) and the three-year statute applicable to the unfair competition claims, Cal. Code Civ. Proc. Ann. § 338(d).
Outcome
Motion to dismiss denied in part and granted in part, with leave to amend. If you need an attorney to research legal issues, draft legal documents and present the case before the court get a litigation attorney.
Procedural Posture
Plaintiff limited partner sued defendants, partnership and individual, alleging breach of breach of letter agreement, breach of limited partnership agreement, breach of fiduciary duty, conversion of partnership assets, accounting, unjust enrichment, and violation of Cal. Bus. & Prof. Code § 17200. The individual moved to dismiss pursuant to Fed. R. Civ. P. 12(b)(6).
Overview
The parties were owners of a professional football team. The limited partner alleged the individual breach both a letter of agreement and the limited partnership agreement by failing to honor a tag-along provision in those agreements. The limited partner also alleged that the individual mismanaged partnership assets. The court held that because the letter agreement did not explicitly address whether the word interest was intended to include an indirect interest, there was an ambiguity which could not be resolved at this point in the proceedings. The limited partner had included allegation that went beyond conclusory allegation in support of his alter ego theory and were sufficient to support claims on the theory of de facto partnership. The limited partner was not barred under state law from bringing derivative claims on behalf of the partnership. The limited partner had not adequately pleaded futility and those claims were dismissed with leave to amend to plead specific facts that showed either that a formal demand was wrongfully rejected, or futility.
Outcome
The motion to dismiss was denied with regard to breach of letter agreement, breach of limited partnership agreement, breach of fiduciary duty, and violation of state business laws. The motion was granted with regard to all other claims, and the limited partner was granted leave to amend the complaint