Thursday, March 8, 2012

TD Bank Takes Another Rothstein Hit.

 All the bad headlines for TD Bank involving Scott Rothstein must really interfere with their big outreach efforts in South Florida, and this order from Judge Marra in yet another investor suit can't help:
Through their Complaint, Plaintiffs allege that “Defendant intended Plaintiffs to rely upon its misrepresentations,” Complaint at ¶ 53 (emphasis added), and “Plaintiffs relied on Defendant’s misrepresentations [and omissions] and engaged in the Transactions based upon the misrepresentations and Plaintiffs would not have engaged in the Transactions had he known the truth.” Complaint at ¶ 54. The Court finds that these two statements adequately plead “justifiable reliance” as required by Florida law. The Court will not dismiss an action simply because Plaintiffs fail to use “magic words” when the pleading is otherwise sufficient. See Cabrera v. Martin, 973 F.2d 735, 745 (9th Cir. 1992) (“We therefore find no reason to reverse the district court on the grounds that the appellees failed to plead § 1983 as a basis of their complaint or because they failed to use the magic words ‘under color of state law’ . . .”) However, in an abundance of caution, the Court will grant Plaintiffs’ request to amend their Complaint to include the word “justifiable.”

Defendant also alleges that Plaintiff has failed to meet the heightened pleading requirements of Rule 9(b). After carefully reviewing the Complaint, the Court finds that Plaintiffs’ claim for negligent misrepresentation satisfies the heightened pleading requirements of Rule 9(b). Plaintiffs expressly allege that Frank Spinosa (“Spinosa”), TD Bank’s Vice President of Operations, misrepresented TD Bank’s verification of the ultimately fictitious plaintiffs that were the source of funding for the structured settlements at the heart of Rothstein’s ponzi scheme. Complaint at ¶ 35-41. Plaintiffs assert the date (September 24, 2009), method ofommunication (telephone), and specific content of the conversation between Spinosa and Plaintiffs’ representatives. Complaint at ¶ 35-41. Plaintiffs also allege specific quotations advanced by Spinosa intended on assuring Plaintiffs’ representatives of the validity of Rothstein’s ultimately illegitimate scheme. Complaint at ¶ 39-41. These allegations are sufficient to avoid dismissal at this stage of the proceedings.
 Judge Marra did dismiss two other counts but granted leave to replead.

Rhett Traband from Broad & Cassel represents the plaintiff.

Boilermakers anyone?


Anonymous said...

shout out to rhett traband. wonder if he's still getting carded or offered opie taylor lookalike roles at birthdays or bar mitzvahs

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