Llewellyn-Jones v. Metro Property Group, LLC, 22 F. Supp. 3d 760

Plaintiffs are foreign investors who allege a Detroit foreclosed-homes fraud scheme by corporate and individual defendants.
Defendants include Metro Property Group entities (Metro Property Group, Metro Property Management, Apex Equities, Global Power Equities) and individual Baydouns, Allen-related defendants, etc., all Michigan-based.
Plaintiffs claim homes were marketed as refurbished, Section 8–compliant, tenanted, and profitable, but were actually in disrepair, unrentable, or forged leases.
Complaint spans 371 paragraphs, cites numerous exhibits, alleges pre-sale misrepresentations and post-sale fraud in management and evictions, plus forged documents.
Court granted in part and denied in part, striking certain paragraphs alleging Hezbollah ties and related misconduct and dismissing several counts while allowing limited contract-based relief and scheduling a case-management conference.
Motions to strike paragraphs 59–62 regarding Hezbollah allegations were granted as immaterial and scandalous.
Certain counts (I, II, IX, X, XI, XII) were dismissed with prejudice or in part; breach-of-contract and related relief were narrowed; post-sale management contracts against Metro Property Management permissible, others not.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Economic loss doctrine applicability to tort claims	Plaintiffs plead fraud in inducement as extraneous to contract.	Defendants contend economic loss doctrine bars I, II, IX, X, XI, XII.	Fraud in inducement falls outside doctrine; fraud claims survive
Sufficiency of fraud pleadings under Rule 9(b)	Complaint provides detailed examples tying defendants to fraud.	Group pleading fails to identify speakers/defendants per Claim.	Fraud claims survive for some defendants; others dismissed for lack of specificity
Effect of merger and As-Is clauses on reliance and breach claims	Misrepresentations invalidated the contract; merger clause not absolute.	Merger/As-Is clauses preclude reliance on pre-contract misrepresentations.	Reliance survives for fraud; breach claim narrowed and limited to specific management contracts
Remain viability of breach of contract vs. implied/Unjust enrichment claims	Alternative pleading allowed where fraud may void contract.	No implied contract where express contract exists; quantum meruit inappropriate.	Count III partially survives for management contracts; Count IV dismissed; other contract-based claims dismissed
RICO viability and enterprise/pattern elements	Allegations show a coordinated scheme with pattern of fraud.	Need clearer enterprise and continuity allegations; some claims fail under Rule 9(b).	RICO viable for Metro Property and Beydoun groups; enterprise and pattern adequately pleaded

Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (plausibility required; threadbare recitals insufficient)
Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (pleading must plead plausible facts, not mere conclusions)
Huron Tool & Eng’g Co. v. Precision Consulting Servs., Inc., 209 Mich.App. 365, 532 N.W.2d 541 (Mich.App. 1995) (fraud exception to economic loss doctrine; misrepresentation allows intentional breach to be actionable)
Archambo v. Lawyers Title Ins. Corp., 466 Mich. 402, 646 N.W.2d 170 (Mich. 2002) (integration clause does not bar fraud claims where fraud undermines contract)
UAW-GM Human Resource Center v. KSL Recreation Corp., 228 Mich.App. 486, 579 N.W.2d 411 (Mich.App. 1998) (merger clause limitations; fraud can vitiate entire contract)
Star Insurance Co. v. United Commercial Insurance Agency, Inc., 392 F.Supp.2d 927 (E.D. Mich. 2005) (fraud can supplement, not reform, a contract in presence of merger clause)
Custom Data Solutions, Inc. v. Preferred Capital, Inc., 274 Mich.App. 239, 733 N.W.2d 102 (Mich.App. 2006) (fraud elements; reliance, intent, damages required)
Hoover v. Langston Equipment Associates, Inc., 958 F.2d 742 (6th Cir. 1992) (Rule 9(b) specificity requirement for fraud pleadings)