United States District Court, D. Delaware
DR. LAKSHMI ARUNACHALAM, Plaintiff,
GEORGE PAZUNIAK, et al., Defendants.
Lakshmi Arunachalam, Menlo Park, California. Pro Se
Pazuniak, Esquire, Pazuniak Law Office LLC, Wilmington,
Delaware. Counsel for Defendants George Pazuniak and Pazuniak
Law Office LLC.
T. O'Kelly, Esquire, and Ryan M. Ernst, Esquire,
O'Kelly & Ernst, LLC, Wilmington, Delaware. Counsel
for Defendant O'Kelly, Ernst & Bielli, LLC.
ANDREWS, U.S. DISTRICT JUDGE
Dr. Lakshmi Arunachalam, who appears pro se and has
paid the filing fee, filed this action on November 14, 2014,
in the United States District Court for the Northern District
of California. (D.I. 1). The matter was transferred to this
Court on March 25, 2015. (D.I. 99, 100). On February 24,
2016, the Court granted in part and denied in part
Defendants' motions to dismiss the First Amended
Complaint and Plaintiff was given leave to
amend. (D.I. 125). The Second Amended Complaint
asserts jurisdiction pursuant to: (1)28 U.S.C. § 1331 by
reason of a federal question; (2) 28 U.S.C. § 1337(a) by
reason of a federal statute regulating commerce; and (3) 28
U.S.C. § 1338 by reason of patents, copyrights, and
trademarks. (D.I. 158 at ¶ 36). Defendants George
Pazuniak, Pazuniak Law Office LLC, and O'Kelly, Ernst
& Bielli, LLC move for dismissal pursuant to Fed.R.Civ.P.
12(b)(1) and 12(b)(6) and for partial summary judgment. (D.I.
159). Plaintiff opposes. Briefing on the matter has been
completed. (D.I. 160, 161, 172, 173, 174).
filed the Second Amended Complaint on August 15, 2016, after
having been given several extensions of time. (See
D.I. 129, 137, 143, 151, 157). The First Amended Complaint
contained eleven counts, as follows: Counts One, Two, Three,
and Five were raised against all Defendants and alleged legal
malpractice (id. at ¶¶18-30), negligence
(id. at ¶¶ 31-34), breach of fiduciary
duty (id. at ¶¶ 35-44), and failure to
provide competent representation (id. at
¶¶ 56-61). Count Four was raised solely against
Pazuniak and alleged that he did not follow instructions.
(Id. at ¶¶ 45-55). Count Eleven was raised
against Pazuniak and the George Pazuniak Law Firm
LLCand sought a declaratory judgment
"regarding libel." (Id. at ¶¶
81-85). Counts Six, Seven, Eight, Nine, and Ten appeared to
be directed only against Pazuniak. Count Six alleged
intimidation, harassment, blackmail, fraud, drinking, false
billing, bullying, duress, collusion with defense counsel and
new appellate counsel, conspiracy to commit fraud and
intentional breach of fiduciary duty, unauthorized violation
of attorney-client privilege, breach of ethical obligations,
threats, and racial slurs. (Id. at ¶¶
62-74). Count Seven alleged sexual harassment, racial slurs,
and personal injury (id. at ¶¶ 75-77),
Count Eight alleged financial damage (id. at
¶¶ 78), Count Nine alleged elder abuse
(id. at ¶ 79), and Count Ten alleged breach of
contract (id. at ¶ 80).
Second Amended Complaint contains seven counts. (D.I. 158)
For the first time, Plaintiff raises civil RICO claims and
claims under 42 U.S.C. § 1983. Counts One and Two,
raised against all Defendants, contain the newly added civil
RICO claims, pursuant to 18 U.S.C. §§ 1962(a), (b),
(c), and (d), and § 1964(c). (Id. at
¶¶ 41-142). Count Three is raised against all
Defendants and alleges legal malpractice/ngligence, that
Pazuniak did not follow client instructions, and Defendants
failed to provide competent representation. (Id. at
¶¶ 143-187). Count Four is raised against Pazuniak
and alleges that he failed to return or reimburse monies owed
to Plaintiff from settlements and monies paid by
Plaintiff. (Id. at ¶¶ 189-201).
Count Five appears to be raised solely against Pazuniak and
raises personal injury, sexual harassment, racial slur, and
civil rights violations under 42 U.S.C. §§ 1983 and
1988. (Id. at ¶¶ 202-11).
Count Six appears to be raised solely against Pazuniak and
alleges intentional fraud. (Id. at ¶¶
212-14). Count Seven alleges breach of contract and appears
to be raised against all Defendants. (Id. at
a California resident, is the "the sole inventor/owner
of early Internet patents" and "the inventor of Web
applications displayed on a Web browser in ubiquitous use
worldwide by consumers and small, mid-sized and giant
corporations and the U.S. Government." (Id. at
¶ 37). George Pazuniak is an "attorney licensed to
practice law in Delaware with an office in Wilmington,
DE" and George Pazuniak Law Office, LLC, was "a law
firm duly organized and existing under the laws of the State
of Delaware with its principal place of business in the City
of Wilmington, Delaware." (Id. at ¶¶
28-29). O'Kelly, Ernst & Bielli, LLC is "a law
firm duly organized and existing under the laws of the State
of Delaware with its principal place of business in the City
of Wilmington, Delaware and also in Philadelphia, PA."
(Id. at ¶ 30). Plaintiff hired Pazuniak and
Pazuniak Law Office "for her patent cases against many
infringers in 2011, 2012, and 2013 based upon his
representation that he is a patent litigator and would
provide competent counsel to competently conduct her patent
cases." (Id. at ¶ 38). Plaintiff alleges
that Pazuniak "joined the O'Kelly Law Firm during
the course of her patent litigation, and Pazuniak and
O'Kelly Law firm became the Plaintiff attorneys in her
patent cases." (Id.). With the assistance of
Defendants, Plaintiff sued a number of corporations for
patent infringement. The claims in this action all arise out
of Defendants' representation in those patent
move for dismissal pursuant to Rules 12(b)(1) and 12(b)(6)
for lack of standing and for failure to state claims upon
which relief may be granted. Fed.R.Civ.P. 12. In addition to
seeking dismissal, Defendants also move for summary judgment
on Plaintiff's two frauds claims found at Paragraph 214
of the Second Amended Complaint on the grounds that there is
no genuine issue as to any material fact.
seek dismissal pursuant to Rules 12(b)(1) and 12(b)(6) of the
Federal Rules of Civil Procedure and have submitted matters
of public record as well as documents referred to in the
Second Amended Complaint in support of their motion.
In deciding motions to dismiss pursuant to Rule 12(b)(6),
courts generally consider only the allegations in the
complaint, exhibits attached to the complaint, matters of
public record, and documents that form the basis of a claim.
A document forms the basis of a claim if the document is
'integral to or explicitly relied upon in the
complaint.' The purpose of this rule is to avoid the
situation where a plaintiff with a legally deficient claim
that is based on a particular document can avoid dismissal of
that claim by failing to attach the relied upon document.
Further, considering such a document is not unfair to a
plaintiff because, by relying on the document, the plaintiff
is on notice that the document will be considered.
Lum v. Bank of Am., 361 F.3d 217, 221-22 n.3 (3d
Cir. 2004) (internal citations omitted). The documents
submitted to the Court that are matters of public record may
properly be considered in ruling on Defendants' motions
to dismiss. George Pazuniak included a declaration in
briefing the issues, and it may be considered when ruling on
Defendants' motion for partial summary judgment.
(See D.I. 161).
Plaintiff proceeds pro se, her pleading is liberally
construed and her Second Amended Complaint, "however
inartfully pleaded, must be held to less stringent standards
than formal pleadings drafted by lawyers." Erickson
v. Pardus, 551 U.S. 89, 94 (2007).
move for dismissal on the grounds that: (1) Plaintiff
entirely revised her complaint, but ignored the Court's
prior rulings, and "added new problems" by pleading
RICO and § 1983 violations; (2) that all seven claims as
pled by Plaintiff should be dismissed as a matter of law; (3)
no claims are stated against O'Kelly, Ernst & Bielli,
LLC; and (4) the Court must abstain from Count Four.
12(b)(1) of the Federal Rules of Civil Procedure permits the
dismissal of an action for "lack of subject matter
jurisdiction." A Rule 12(b)(1) motion may be treated as
either a facial or factual challenge to the court's
subject matter jurisdiction. See Constitution Party of
Pa. v. Aichele, 757 F.3d 347, 357-58 (3d Cir. 2014). In
reviewing a facial attack, "the court must only consider
the allegations of the complaint and documents referenced
therein and attached thereto, in the light most favorable to
the plaintiff, " and the standards relevant to Rule
12(b)(6) apply. Id. at 358.
reviewing a factual challenge to the Court's subject
matter jurisdiction, the Court is not confined to the
allegations of the complaint, and the presumption of
truthfulness does not attach to the allegations in the
complaint. Mortensen v. First Fed. Sav. & Loan
Ass'n, 549 F.2d 884, 891 (3d Cir. 1977). Instead,
the Court may consider evidence outside the pleadings,
including affidavits, depositions and testimony, to resolve
any factual issues bearing on jurisdiction. Gotha v.
United States, 115 F.3d 176, 179 (3d Cir. 1997). Once
the Court's subject matter jurisdiction over a complaint
is challenged, the plaintiff bears the burden of proving that
jurisdiction exists. Mortensen, 549 F.2d at 891.
requires a complainant to provide "a short and plain
statement of the claim showing that the pleader is entitled
to relief... ." Fed.R.Civ.P. 8(a)(2). Rule 12(b)(6)
allows the accused party to bring a motion to dismiss the
claim for failing to meet this standard. A Rule 12(b)(6)
motion may be granted only if, accepting the well-pleaded
allegations in the complaint as true and viewing them in the
light most favorable to the complainant, a court concludes
that those allegations "could not raise a claim of
entitlement to relief." Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 558 (2007).
'detailed factual allegations' are not required, a
complaint must do more than simply provide 'labels and
conclusions' or 'a formulaic recitation of the
elements of a cause of action.'" Daw's v.
Abington Mem'l Hosp., 765 F.3d 236, 241 (3d Cir.
2014) (quoting Twombly, 550 U.S. at 555). I am
"not required to credit bald assertions or legal
conclusions improperly alleged in the complaint." In
re Rockefeller Ctr. Props., Inc. Sec. Litig., 311 F.3d
198, 216 (3d Cir. 2002). A complaint may not be dismissed,
however, "for imperfect statement of the legal theory
supporting the claim asserted." Johnson v. City of
Shelby, 135 S.Ct. 346, 346 (2014).
complainant must plead facts sufficient to show that a claim
has "substantive plausibility." Id. at
347. That plausibility must be found on the face of the
complaint. Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). "A claim has facial plausibility when the
[complainant] pleads factual content that allows the court to
draw the reasonable inference that the [accused] is liable
for the misconduct alleged." Id. Deciding
whether a claim is plausible will be a "context-specific
task that requires the reviewing court to draw on its
judicial experience and common sense." Id. at
Second Amended Complaint does not comply with the Federal
Rules of Civil Procedure, which require the complaint to
contain "a short and plain statement of the claim
showing that the pleader is entitled to relief."
Fed.R.Civ.P. 8(a)(2). The Second Amended Complaint, at 149
pages in length, is not short and it is not plain. Numerous
exhibits totalling about 500 pages are attached to the Second
Amended Complaint, mostly to support the RICO claims. They
are referred to as providing a "preponderance of
evidence" of documentary material of Defendants'
alleged misconduct, generally without citation to a specific
exhibit or page number. (See D.I. 158 at ¶¶ 57, 61,
63, 67, 72, 74, 97, 104, 120, 130, 138, 139).
Counts One and Two
Count One, Plaintiff attempts to raise civil racketeering
claims against all Defendants and alleges that they violated
18 U.S.C. §§ 1962(a), (b), (c), and (d). Count Two
seeks treble damages under 18 U.S.C. § 1964(c).
Defendants move to dismiss for failure to state claims upon
which relief may be granted.
Racketeer Influenced Corrupt Organization Act, 18 U.S.C.
§§ 1961-68, authorizes civil suits by '[a]ny
person injured in his business or property by reason of a
violation of [18 U.S.C. § 1962].'" Hughes
v. Consol-Pennsylvania Coal Co., 945 F.2d 594, 609 (3d
Cir. 1991) (quoting 18 U.S.C. § 1964(c)).
"Section 1962(a) prohibits any person who has received
any income derived . . . from a pattern of racketeering
activity from using that money to acquire, establish, or
operate any enterprise that affects interstate commerce.
Section 1962(b) prohibits any person from acquiring or
maintaining an interest in, or controlling any such
enterprise through a pattern of racketeering activity.
Section 1962(c) prohibits any person employed by or
associated with an enterprise affecting interstate commerce
from conduct[ing] or participat[ing]... in the conduct of
such enterprise's affairs through a pattern of
Kehr Packages, Inc. v. Fidelcor, Inc., 926 F.2d
1406, 1411 (3d Cir. 1991). Section 1962(d) provides for a
RICO conspiracy claim, making it unlawful "for any
person to conspire to violate any of the provisions of
subsection (a), (b), or (c) of this section." 18 U.S.C.
§ 1962(d). The Court distills what is ...