LAUREL BEELER, Magistrate Judge.
Plaintiff Hexagon Securities, LLC ("Hexagon") entered into a contract with Defendant Golden Pacific Bancorp, Inc. ("GPB"), which Hexagon now says GPB breached by not paying it a transaction fee with respect to a transaction that closed after the contract terminated. Hexagon sued GPB, and now GPB moves to dismiss Hexagon's First Amended Complaint. Pursuant to Civil Local Rule 7-1(b), the court found this matter suitable for determination without oral argument and vacated the January 15, 2015 hearing. Upon consideration of Hexagon's allegations, the briefs submitted, and the applicable legal authority, the court grants GPB's motion and dismisses without prejudice Hexagon's First Amended Complaint.
Hexagon is a small investment bank that specializes in capital markets, capital raising, and mergers and acquisition activities. First Amended Complaint ("FAC"), ECF No. 11 at 1.
Id., Ex. A, ECF No. 11-1 at 1, 3-4, 12-13, ¶¶ 1, 4(a), 7, 9, 13 (underlining in original); see also id., ECF No. 11 at 2-3.
In its First Amended Complaint, Hexagon alleges that, pursuant to the Agreement, and beginning in or around June 2011, it worked as the Lead Placement Agent for a Transaction involving Gapstow Capital Partners ("Gapstow") (the "Gapstow Transaction"). Id., ECF No. 11 at 3. It says that it expended significant resources in connection with the Gapstow Transaction, including assisting with preparing presentations for Gapstow, formulating equity calculations related to value/share structure, and other time-intensive tasks essential to the success of the Gapstow Transaction. Id. at 3-4.
Despite its beginnings in June 2011, the Gapstow Transaction did not close for a few years. Hexagon alleges that GPB acknowledged Hexagon's work and role in several communications throughout 2013 and 2014, and that GPB requested Hexagon's assistance with respect to the Gapstow Transaction on numerous occasions in 2014. Id. at 4. Hexagon responded to each request diligently. Id. Nevertheless, GPB's Chief Executive Officer, Virginia Varela, sent Hexagon a letter dated July 2, 2014 which stated that she "believ[ed] that all of [GPB's] obligations pursuant to [its agreements with Hexagon] have been satisfied in full and that no fees will be due under either of these agreements in the future." Id. Gapstow (as distinguished from GPB), however, continued to request assistance from Hexagon with respect to the Gapstow Transaction as late as August 14, 2014. Id. And "senior representatives of GPB acknowledged Hexagon's ole and entitlement to compensation" as late as August 16, 2014. Id.
On some unspecified date thereafter, the Gapstow Transaction closed. Id. GPB raised $3,000,000 of capital through it. Id. Hexagon believes that it is entitled, under the Agreement, to a 6% Transaction Fee based on its work on the Gapstow Transaction, so on September 12, 2014 it sued GPB in this court to recover it. See Original Complaint, ECF No. 1. After GPB answered it, Hexagon filed its First Amended Complaint as a matter of right. See FAC, ECF No. 11; see also Fed. R. Civ. P. 15(a)(1)(B). In it, Hexagon brings two claims for breach of contract and one claim for unjust enrichment. See FAC, ECF No. 11 at 5-6. GPB then filed a motion to dismiss the First Amended Complaint. See Motion, ECF No. 14. Hexagon filed an opposition, and GPB filed a reply. See Opposition, ECF No. 17; Reply, ECF No. 19. Both parties consented to the undersigned's jurisdiction over this action. See Consent (Hexagon), ECF No. 9; Consent (GPB), ECF No. 10.
Federal Rule of Civil Procedure 8(a) requires that a complaint contain 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 therefore provide a defendant with "fair notice" of the claims against it and the grounds for relief. See Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quotation and citation omitted).
A court may dismiss a complaint under Federal Rule of Civil Procedure 12(b)(6) when it does not contain enough facts to state a claim to relief that is plausible on its face. See Twombly, 550 U.S. at 570. "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." Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). "The plausibility standard is not akin to a `probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. (quoting Twombly, 550 U.S. at 557.). "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the `grounds' of his `entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above the speculative level." Twombly, 550 U.S. at 555 (internal citations and parentheticals omitted).
In considering a motion to dismiss, a court must accept all of the plaintiff's allegations as true and construe them in the light most favorable to the plaintiff. See id. at 550; Erickson v. Pardus, 551 U.S. 89, 93-94 (2007); Vasquez v. Los Angeles County, 487 F.3d 1246, 1249 (9th Cir. 2007).
If the court dismisses the complaint, it should grant leave to amend even if no request to amend is made "unless it determines that the pleading could not possibly be cured by the allegation of other facts." Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (quoting Cook, Perkiss and Liehe, Inc. v. Northern California Collection Serv. Inc., 911 F.2d 242, 247 (9th Cir. 1990)). But when a party repeatedly fails to cure deficiencies, the court may order dismissal without leave to amend. See Ferdik v. Bonzelet, 963 F.2d 1258, 1261 (9th Cir. 1992) (affirming dismissal with prejudice where district court had instructed pro se plaintiff regarding deficiencies in prior order dismissing claim with leave to amend).
GPB moves to dismiss each of Hexagon's three claims. The court addresses each claim in turn below.
In its first breach of contract claim, Hexagon alleges that the Agreement is a valid and enforceable agreement, that it performed all of its duties (including those with respect to the Gapstow Transaction) under the Agreement, that it therefore is entitled to a 6% Transaction Fee with respect to the Gapstow Transaction, that GPB breached the Agreement by not paying the Transaction Fee to it, and that it has been damaged for this reason. See FAC, ECF No. 11 at 5.
GPB argues that Hexagon's claim fails because the Gapstow Transaction did not occur before the Agreement terminated or within the six-month Tail Period, so the Agreement has not been breached. Based on Hexagon's allegations, the Agreement terminated on December 31, 2013, and the six-month Tail Period ended on June 30, 2014. Section 7 of the Agreement provides that this is to be the Termination Date unless it is extended by mutual agreement of the parties, and Section 13 provides that the Agreement may not be amended or modified except in writing signed by each party. Here, while Hexagon argues in its opposition that Hexagon and GPB extended the Agreement to cover the closing date of the Gapstow Transaction, such an allegation does not appear in the First Amended Complaint, nor has Hexagon pointed to any agreement that extends the Termination Date of Agreement. Thus, the Agreement terminated on December 31, 2013, and the six-month Tail Period ended on June 30, 2014.
So, did the Gapstow Transaction close before June 30, 2014? Not according to Hexagon's allegations. Although it does not provide a specific closing date, it is clear from the chronology of Hexagon's allegations that the Gapstow Transaction was still being worked on as late as August 2014, and it was only sometime around then, or shortly thereafter, that the Gapstow Transaction closed. Section 7 of the Agreement makes clear that, with certain exceptions not applicable here, Hexagon's and GPB's rights and obligations under the Agreement terminate at the Agreement's Termination Date and that the Tail Period lasts only for six months. Because the Gapstow Transaction closed after this period, and in the absence of any allegations that the parties extended the Termination Date or that GPB did not use good faith efforts to close the Gapstow Transaction in a reasonably expeditious manner, GPB's obligation to pay Hexagon a Transaction Fee extinguished on June 30, 2014. Accordingly, Hexagon's first breach of contract claim fails and must be dismissed without prejudice. The court dismisses the claim without prejudice because the court cannot say at this time that Hexagon cannot allege that the parties agreed in writing to extend the Termination Date or that GPB intentionally or wrongfully delayed the Gapstow Transaction to frustrate Hexagon's rights under the Agreement.
In its second breach of contract claim, Hexagon alleges that the Agreement is a valid and enforceable agreement, that it performed all of its duties under the Agreement, that the parties consented to the jurisdiction of California's state and federal courts and agreed to waive the defenses of improper venue or inconvenient forum in the Agreement, that GPB breached the Agreement by asserting improper venue and inconvenient forum as affirmative defenses in GPB's answer to Hexagon's now-superseded Original Complaint, and that it has been damaged because it has incurred unnecessary costs and attorney's fees to defend against these affirmative defenses. See FAC, ECF No. 11 at 5.
The court finds that this claim fails because it is moot and Hexagon suffered no damages because it never had to defend against its affirmative defenses. As explained above, GPB asserted its defenses in response to Hexagon's Original Complaint, which was superseded when it chose to file a First Amended Complaint as a matter of right. GPB never had to defend against GPB's affirmative defenses because it immediately filed a First Amended Complaint. The court notes that Hexagon does not address these points in its opposition. In these circumstances, the court finds that Hexagon's second breach of contract claim fails and must be dismissed without prejudice.
In its unjust enrichment claim, which is pled in the alternative, Hexagon alleges that it provided valuable placement and advisory services to GPB worth at least $126,000, that GPB was enriched in that amount, and that it would be inequitable to permit GPB to retain the benefit of Hexagon's services without compensating Hexagon for them. See FAC, ECF No. 11 at 6.
This claim also must be dismissed. As GPB points out, under New York law, a claim for unjust enrichment fails where there exists an express contract that covers the subject matter forming the basis for the unjust enrichment claim. See IDT Corp. v. Morgan Stanley Dean Witter & Co., 907 N.E.2d 268 (N.Y. 2009) ("The theory of unjust enrichment lies as a quasi-contract claim. It is an obligation imposed by equity to prevent injustice, in the absence of an actual agreement between the parties concerned. Where the parties executed a valid and enforceable written contract governing a particular subject matter, recovery on a theory of unjust enrichment for events arising out of that subject matter is ordinarily precluded.") (citing Clark-Fitzpatrick, Inc. v. Long Is. R.R. Co., 516 N.E.2d 190, 193 (N.Y. 1987)) (internal citation and quotation marks omitted); see also Georgia Malone & Co., Inc. v. Rieder, 973 N.E.2d 743, 746 (N.Y. 2012). Here, the Agreement clearly delineates Hexagon's right to receive, and GPB's obligation to pay, a Transaction Fee. Hexagon does not dispute this point, see Opposition, ECF No. 17 at 7, and it also does not allege that the Agreement was procured by fraud or is invalid. Accordingly, Hexagon's unjust enrichment claim fails and must be dismissed without prejudice.
Based on the foregoing, the court grants GPB's motion and dismisses without prejudice Hexagon's First Amended Complaint. Hexagon may file a Second Amended Complaint by January 27, 2015.
