Kalimantano GmbH v. Motion in Time, Inc.
939 F. Supp. 2d 392
S.D.N.Y.2013Background
- Kalimantano is a German food-wholesale company that did business with MIT and the Shamayevs.
- Davidoff, Kalimantano’s operating manager, facilitated watches purchases and became acquainted with MIT.
- MIT is a New York jewelry/watches retailer whose email promotions allegedly targeted Kalimantano and Davidoff.
- Alleged conduct includes three watch transactions: Tuleshov, Frankfurt, and Davidoff, with claims of non-new or used watches sold as new.
- The Frankfurt transaction involved cash payment, intermediary fees to Davidoff, and later allegations of misrepresentation; Davidoff sought refunds and discovered the watch was used.
- Plaintiffs later faced threats from the Shamayevs to abandon their claims, and a defamatory website was allegedly created against Davidoff and Kalimantano.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether RICO claim survives 12(b)(6) dismissal | Plaintiffs contend MIT is a RICO enterprise with a pattern of fraud. | Defendants argue insufficient continuity; acts are few and separate. | RICO claim dismissed for lack of open/closed-ended continuity. |
| Open-ended continuity whether predicate acts show ongoing criminal conduct | Allegations show ongoing fraud across several transactions over years. | Acts are few, discrete, and limited to sales of watches; not ongoing. | Open-ended continuity not established. |
| Closed-ended continuity whether duration and scope show a pattern | Fraudulent acts spanned nearly four years and multiple victims. | Scheme is narrow, with few victims; not a persistent pattern. | Closed-ended continuity not established; RICO claim dismissed. |
| Remaining state-law claims after RICO dismissal | Some claims (breach of contract, money had and received, unjust enrichment) may survive. | Most claims are duplicative or barred by economic loss rule; others fail. | Breach of contract survives; money had and received and unjust enrichment survive as potential alternatives; other claims dismissed. |
Key Cases Cited
- Cofacredit, S.A. v. Windsor Plumbing Supply Co., Inc., 187 F.3d 229 (2d Cir. 1999) (open-ended continuity requires more than a few isolated acts)
- DeFalco v. Bernas, 244 F.3d 286 (2d Cir. 2001) (pattern requires continuation or threat of continuation)
- H.J. Inc. v. Northwest Bell Tel. Co., 492 U.S. 229 (Supreme Court 1989) (defines pattern and continuity for RICO)
- GICC Capital Corp. v. Tech. Fin. Grp., Inc., 67 F.3d 463 (2d Cir. 1995) (discusses continuity and inherently unlawful acts)
- Kaplan v. Beauford, 886 F.2d 536 (2d Cir. 1989) (discusses threat of continued activity and Beauford guidance)