Gonzalez Camacho et al v. Major League Baseball et al, No. 3:2012cv02859 - Document 31 (S.D. Cal. 2013)
Court Description: ORDER granting 12 Defendant's Motion to Dismiss. The Court Grants Dismisses this action in its entirety. Signed by Judge M. James Lorenz on 12/19/2013. (sjt)
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Gonzalez Camacho et al v. Major League Baseball et al Doc. 31 1 2 3 4 5 6 7 8 9 10 UNITED STATES DISTRICT COURT 11 SOUTHERN DISTRICT OF CALIFORNIA 12 13 DAVID GONZALEZ CAMACHO, et al., ) Case No. 12-cv-2859-L(BGS) ) 14 Plaintiffs, ) ORDER GRANTING ) DEFENDANTS’ MOTION TO 15 v. ) DISMISS [DOC. 12] ) 16 MAJOR LEAGUE BASEBALL, et al., ) ) 17 Defendants. ) ) 18 ) ) 19 On November 30, 2012, Plaintiffs David Gonzalez Camacho and Daniel Arrellano 20 Pesqueira commenced this tort action against multiple defendants.1 This action arises from 21 allegations that Major League Baseball conspired with the Mexican Major Leagues to prevent 22 baseball prospect Daniel Pesqueira from playing baseball in the United States. Pending before 23 the Court is the Office of the Commissioner of Baseball (d/b/a Major League Baseball), Major 24 League Baseball Enterprises, Inc., and Major League Baseball Properties, Inc.’s motion to 25 26 1 The defendants in this action are Major League Baseball, Major League Baseball 27 Enterprises, Inc., Major League Baseball Properties, Inc., Office of the Commissioner of Baseball, National Association of Professional Baseball Leagues, National Association of 28 Professional Baseball Leagues, Inc., and Minor League Baseball. 12cv2859 Dockets.Justia.com 1 dismiss pursuant to Federal Rule of Civil Procedure 12(b)(7).2 Plaintiffs oppose the motion. 2 The Court found this motion suitable for determination on the papers submitted and 3 without oral argument. See Civ. L.R. 7.1(d.1). (Doc. 19.) For the following reasons, the Court 4 GRANTS Defendants’ motion to dismiss. 5 6 I. BACKGROUND3 7 Mr. Gonzalez is a citizen of Mexico, “who is domiciled and does business in the City of 8 Tijuana . . . in the country of Mexico, and who does business and resides in the County of San 9 Diego, California, USA.” (First Am. Compl. (“FAC”) ¶ 4.) He is and was “engaged in the 10 training, support, promotion and representation of young, talented and high caliber Mexican 11 baseball players for eventual placement in international major and minor leagues, including 12 Major and Minor League baseball conducted in the United States[.]” (Id.) Mr. Pesqueira is a 13 citizen of Mexico who resides in Tijuana, Mexico. (Id.) 14 On April 1, 2010, Mr. Gonzalez entered into an “Exclusive Agency Contract” with Mr. 15 Pesqueira’s parents on behalf of Mr. Pesqueira, who was a minor at the time. (FAC ¶ 15.) 16 Under the agency contract, Mr. Pesqueira provided Mr. Gonzalez with, among other things, the 17 “exclusive rights to represent Pesqueira in the negotiation for and contracting of any and all 18 services of Pesqueira as a baseball player for any club in the major and/or minor leagues of any 19 and all countries at any level of play; and Plaintiff Pesqueira agreed that Plaintiff Gonzalez 20 would receive a 30% commission on any and all receipts and entitlements of Pesqueira for his 21 services as a baseball player for a three year term.” (Id. ¶ 16.) Plaintiffs allege that Mr. 22 Pesqueira is “a young, talented, and burgeoning Mexican baseball player who at all times 23 relevant was and is a formidable left handed pitcher.” (Id. ¶ 15.) And pursuant to the terms of 24 25 26 2 The Court will refer to the defendants moving to dismiss collectively as “Defendants” for the purposes of this motion. 3 In the complaint, David Gonzalez Camacho is referred to as “Gonzalez,” and Daniel 27 Arrellano Pesqueira, who is also once mentioned as “Daniel Pesqueira Arellano,” is referred to as “Pesqueira.” The Court will follow the same naming convention, and refer to the plaintiffs as 28 Mr. Gonzalez and Mr. Pesqueira. 12cv2859 2 1 the contract, Mr. Gonzalez began to train and promote Mr. Pesqueira, eventually garnering the 2 interest of talent scouts. (Id. ¶ 15-2.4) 3 On February 17, 2012, the Boston Red Sox invited Mr. Pesqueira to train with the team 4 for spring training in Fort Meyers, Florida. (FAC ¶ 15-2.) Then on March 6, 2012, a scout for 5 the Boston Red Sox notified Mr. Gonzalez that Mr. Pesqueira would be returned to Mexico 6 “based upon the direction of Major League Baseball” because Mr. Pesqueira “belonged to a 7 Mexican league team and could not play in the major leagues without the consent of the 8 Mexican league team.” (Id. ¶ 16-2.) Plaintiffs dispute the validity of this explanation, which 9 they describe as a “completely false” premise. (See id.) Major League Baseball also advised 10 Mr. Gonzalez that Mr. Pesqueira “was and is on the reserve list of the Association of 11 Professional Baseball Teams of the Mexican Leagues, therefore, he was ineligible to play for the 12 Boston Red Sox.” (Id.) 13 At Mr. Gonzalez’s request, Major League Baseball forwarded a copy of the “contractual 14 documentation” between Mr. Pesqueira and the Mexican League team called the Diablos Rojos 15 (“Red Devils”). (FAC ¶ 18.) Plaintiffs describe the documentation as containing “two 16 preprinted, form pages, each prepared in Spanish[,]” without any contractual terms. (Id.) One 17 page—titled “Contract for Professional Services”—includes Mr. Pesqueira’s signature from 18 January 1, 2010 with a start date of March 22, 2009, and a second page with the same title 19 includes Mr. Pesqueira’s signature from and with a start date of March 21, 2011. (Id.) The 20 former purportedly covers the 2009 Mexican baseball season, and the latter covers the 2011 21 season. Plaintiffs allege that at both times Mr. Pesqueira was under 18 years old, having been 22 born on April 6, 1994. (Id.) They also note that the earlier contract bears Mr. Pesqueira’s father 23 signature, though the later one does not. (Id. ¶ 19.) 24 According to Plaintiffs, Mr. Pesqueira and his father confirmed that they did not sign 25 either of the documents provided by Major League Baseball. (FAC ¶¶ 19–20.) They believe 26 27 4 The complaint includes two paragraph 15s and two paragraph 16s. The Court will refer 28 to the second paragraph 15 as paragraph 15-2, and the second paragraph 16 as 16-2. 12cv2859 3 1 that “either or both signatures of Pesqueira on each document has or have been fraudulently 2 lifted from another document and transferred onto these documents, and that these documents 3 are not authentic.” (Id. ¶ 19.) 4 Sometime thereafter, Mr. Gonzalez made a legal request to produce “any and all contracts 5 or documents signed by Pesqueira, his parents or legal representatives binding him in any way to 6 the Red Devils, to any other baseball team and/or to the Association of Professional Baseball 7 Teams of the Mexican Leagues.” (FAC ¶ 22.) On February 23, 2011, the Association of 8 Professional Baseball Teams of the Mexican Leagues timely complied, and produced a contract 9 similar to the aforementioned ones. (Id. ¶ 24.) However, this contract contained a signature of 10 Mr. Pesqueira dated January 1, 2010 with a March 22, 2010 start date, covering the 2010 11 Mexican baseball season. (Id.) Plaintiffs allege that Mr. Pesqueira’s signature on this contract is 12 the “exact same signature[]” as contained in the earlier documents meant to cover the 2009 13 baseball season. (Id.) Two other documents were also produced: a document “purported to be a 14 Mexican Federal Institute of Elections ID Card of Alberto Pesqueira Corrales, the biological 15 father of Pesqueira,” and a “purported copy of Pesqueira’s birth certificate.” (Id.) Plaintiffs 16 allege that no documentation was produced at the time pertaining to Mr. Pesqueira and the 2011 17 Mexican baseball season. (Id. ¶ 25.) 18 Plaintiffs continued their investigation. (FAC ¶¶ 26–32.) Either during or after the 19 investigation, Mr. Gonzalez “encouraged and facilitated efforts of Major League Baseball to 20 communicate and work with the Association of Professional Baseball Teams of the Mexican 21 Leagues and the Red Devils of Mexico to verify that in fact Pesqueira was free to train and 22 contract with the Boston Red Sox or any other team.” (Id. ¶ 32.) Plaintiffs allege that Major 23 League Baseball did indeed communicate with the Mexican League and “confirmed that 24 Pesqueira in fact was not committed to in any way, nor under contract with, the Association of 25 Professional Baseball Teams of the Mexican Leagues and the Red Devils of Mexico.” (Id.) 26 Plaintiffs commenced this action on November 30, 2012. They subsequently amended 27 their complaint after it was dismissed without prejudice for lack of subject-matter jurisdiction. 28 In the FAC, they assert the following claims against all of the defendants for: (1) intentional 12cv2859 4 1 interference with economic relations; (2) intentional interference with prospective economic 2 advantage; (3) negligent interference with economic relations; (4) negligent interference with 3 prospective economic relations; (5) declaratory relief; (6) negligence; and (7) unfair business 4 practices. Defendants now move to dismiss under Rule 12(b)(7). Plaintiffs oppose. 5 6 II. LEGAL STANDARD 7 A party may move to dismiss a case for “failure to join a party under Rule 19.” Fed. R. 8 Civ. P. 12(b)(7). Rule 19 imposes a three-step inquiry: (1) Is the absent party necessary (i.e., 9 required to be joined if feasible) under Rule 19(a)?; (2) If so, is it feasible to order that absent 10 party to be joined?; and (3) If joinder is not feasible, can the case proceed without the absent 11 party, or is the absent party indispensable such that the action must be dismissed? Salt River 12 Project Agric. Improvement & Power Dist. v. Lee, 672 F.3d 1176, 1179 (9th Cir. 2012). The 13 terms “necessary” and “feasible” are “terms of art in Rule 19 jurisprudence”: “Necessary” refers 14 to a party who should be joined if feasible; and “indispensable” refers to “a party whose 15 participation is so important to the resolution of the case that, if the joinder of the party is not 16 feasible, the suit must be dismissed.” Disabled Rights Action Comm. v. Las Vegas Events, Inc., 17 375 F.3d 861, 867 n.5 (9th Cir. 2004). The failure to join a party under Rule 19 can only lead to 18 dismissal of a suit where the court cannot obtain jurisdiction over the necessary party and that 19 party is determined to be indispensable to the action. See Fed. R .Civ. P. 19(a). 20 “The Ninth Circuit has held that a court should grant a 12(b)(7) motion to dismiss only if 21 the court determines that joinder would destroy jurisdiction and the nonjoined party is necessary 22 and indispensable.” Biagro W. Sales Inc. v. Helena Chem. Co., 160 F. Supp. 2d 1136, 1141 23 (E.D. Cal. 2001). “A motion to dismiss for failure to join an indispensable party requires the 24 moving party to bear the burden in producing evidence in support of the motion.” Id. “A Rule 25 12(b)(7) motion for failure to join an indispensable party demands a fact specific and practical 26 inquiry.” Id.; see Makah Indian Tribe v. Verity, 910 F.2d 555, 558 (9th Cir. 1990). “To 27 determine whether Rule 19 requires the joinder of additional parties, the court may consider 28 evidence outside the pleadings.” McShan v. Sherrill, 283 F.2d 462, 464 (9th Cir. 1960). 12cv2859 5 1 III. DISCUSSION5 2 Defendants argue that both the Red Devils and the Mexican League are necessary parties 3 that cannot be feasibly joined to this action because (1) a determination of the validity of Mr. 4 Pesqueira’s alleged contracts with the Red Devils is necessary, and (2) joining the parties would 5 vitiate this Court’s subject-matter jurisdiction and Plaintiffs cannot establish personal 6 jurisdiction over these absent parties in this Court. Plaintiffs present their claims very differently 7 in their opposition brief compared to the allegations in the complaint. In a disingenuous early8 inning strategic shift, they direct the focus of this action on Mr. Gonzalez’s agency contract with 9 Mr. Pesqueira, arguing that the Red Devils and Mexican League are “joint tortfeasors” that are 10 not necessary parties to litigate the claims asserted in this action. (See Pls.’ Opp’n 8:14–16:24.) 11 Plaintiffs swing for the fences, but ultimately come up short. 12 Upon reviewing the allegations in the complaint, it is clear that the threshold issue in this 13 action is the validity of the alleged contracts entered into between Mr. Pesqueira and the Red 14 Devils. Plaintiffs proceed with their action under the presumption that those contracts are 15 invalid—because Mr. Pesqueira was a minor at the time the contracts were executed, or because 16 the signatures were “fraudulently lifted from another document and transferred onto these 17 documents.” (See FAC ¶¶ 18–20, 24.) These allegations in the complaint overwhelmingly 18 demonstrate that this entire action hinges on one game-winning issue—the validity of the Red 19 Devils contracts. The Court emphasizes that determining the validity of the alleged contracts 20 between Mr. Pesqueira and the Red Devils is outside the scope of this series. Therefore, the 21 Court rejects the disingenuous shifted premise that Plaintiffs present in their opposition brief, 22 and shall proceed analyzing Defendants’ motion while recognizing that the validity of the 23 alleged contracts entered into between Mr. Pesqueira and the Red Devils is the go-ahead run. 24 // 25 // 26 5 Plaintiffs object to every exhibit that Defendants provide. (Docs. 22-1, 26.) Most of the Court’s analysis relies on the allegations in the complaint, but insofar as the Court’s reliance on 28 any of the evidence that Defendants present, the Court OVERRULES Plaintiffs’ objections. 27 12cv2859 6 1 A. 2 A party is necessary if: (1) complete relief cannot be granted in the party’s absence; or (2) The Red Devils and the Mexican League Are Necessary Parties. 3 the district court determines that “the absent party’s participation is necessary to protect its 4 legally cognizable interests or to protect other parties from a substantial risk of incurring 5 multiple or inconsistent obligations because of those interests.” Disabled Rights Action Comm., 6 375 F.3d at 878 (quoting Fed. R. Civ. P. 19(a)). Such a legally cognizable interest must be more 7 than a financial stake in the outcome of the litigation. Makah Indian Tribe, 910 F.2d at 558. 8 Defendants demonstrate that the Red Devils and the Mexican League are necessary parties under 9 the latter of the two aforementioned definitions. See Disabled Rights Action Comm., 375 F.3d at 10 878. 11 Under Rule 19(a)(1)(B)(i), an absent party is necessary if it “has a legally protected 12 interest in the suit” and “that interest will be impaired or impeded by the suit.” Makah Indian 13 Tribe, 910 F.2d at 558 (emphasis in original). “Impairment may be minimized if the absent party 14 is adequately represented in the suit.” Id. It is also a “fundamental principle” that “a party to a 15 contract is necessary, and if not susceptible to joinder, indispensable to litigation seeking to 16 decimate that contract.” Dawavendewa v. Salt River Project Agric. Improvement & Power Dist., 17 276 F.3d 1150, 1157 (9th Cir. 2002). 18 Plaintiffs unequivocally seek a judicial determination of their rights and duties under the 19 alleged contracts between Mr. Pesqueira and the Red Devils. (See FAC ¶ 67–69.) In the 20 complaint, Plaintiffs explicitly state that they desire “a declaration as to whether or not Pesqueira 21 is bound to the Red Devils of Mexico.” (Id. ¶ 68.) They even go as far as to state that a “judicial 22 declaration is necessary and appropriate at this time under the circumstances” because without 23 the declaration, they are “financially burdened by the wrongful position taken by defendants 24 Major League Baseball, and unable to work in their chosen professions.” (Id. ¶ 69 (emphasis 25 added).) In other words, determining the validity of the Red Devils contracts is necessary to 26 resolve essentially all of the wrongful conduct alleged in this action. The same applies to the 27 Mexican League because of its bylaws and regulations that require disputes between players and 28 member teams to be resolved by binding arbitration before the Executive President of the 12cv2859 7 1 Mexican League. (See Defs.’ Ex. E-1; S. Gonzalez Decl. ¶ 4.) 2 Neither the Red Devils nor the Mexican League are represented in this action, and a 3 determination by this Court regarding the validity of the Red Devils contracts may impair and 4 impede the Red Devils’ and the Mexican League’s legally protected interest in this suit. See 5 Makah Indian Tribe, 910 F.2d at 558. Keeping with the baseball theme, a batter cannot record a 6 base hit or a home run against an absent pitcher; that pitcher needs to be in the game before that 7 happens. See id. In this circumstance, the absent pitchers are the Red Devils and the Mexican 8 League. See id. Therefore, as a party to the Red Devils contracts, the Red Devils, and by 9 extension the Mexican League, are necessary parties. See Dawavendewa, 276 F.3d at 1157. 10 Alternatively, under Rule 19(a)(1)(B)(ii), an absent party is also necessary if there is a 11 potential risk that adjudicating an action without the absent party could leave an existing party 12 open to “incurring double, multiple, or otherwise inconsistent obligations.” Fed. R. Civ. P. 13 19(a)(1)(B)(ii). The Ninth Circuit has stated that 14 15 16 17 “[i]nconsistent obligations” are not . . . the same as inconsistent adjudications or results. Inconsistent obligations occur when a party is unable to comply with one court’s order without breaching another court’s order concerning the same incident. Inconsistent adjudications or results, by contrast, occur when a defendant successfully defends a claim in one forum, yet loses on another claim arising from the same incident in another forum. 18 Cahill Dehe Band of Wintun Indians of the Colusa Indian Cmty. v. California, 547 F.3d 962, 976 19 (9th Cir. 2008) (quoting Delgado v. Plaza Las Americas, Inc., 139 F.3d 1, 3 (1st Cir. 1998)). 20 Defendants argue that “the Red Devils could still sue others in the Mexican courts and 21 elsewhere for wrongfully interfering with its contract with Mr. Pesqueira[,]” and “[t]his action 22 will not have any binding effect on the Red Devils unless the team is made a party to this case.” 23 (Defs.’ Mot. 11:10–19.) The concern that Defendants suggest is important, but for the purposes 24 of Rule 19, the paramount concern is a Mexican court or another in the United States 25 determining that the Red Devils contracts are valid if this Court finds that they are not, or vice 26 versa. That would produce inconsistent obligations for all of the parties in this action in addition 27 to the Red Devils because operating under one court’s determination would then necessarily 28 cause the parties to breach another court’s determination regarding the same issue, i.e., the 12cv2859 8 1 validity of the Red Devils contracts. See Cahill Dehe Band of Wintun Indians, 547 F.3d at 976. 2 Therefore, because of the risk of inconsistent obligations, the Red Devils are a necessary party to 3 this action. See id. 4 Swing and a miss—strike one. 5 6 B. 7 “If an absentee is a necessary party under Rule 19(a), the second stage is for the court to Joining the Red Devils and the Mexican League Is Not Feasible. 8 determine whether it is feasible to order that the absentee be joined.” Equal Emp’t Opportunity 9 Comm’n v. Peabody W. Coal Co., 400 F.3d 774, 779 (9th Cir. 2005). Rule 19(a) sets forth three 10 circumstances in which joinder is not feasible: (1) when venue is improper; (2) when the 11 absentee is not subject to personal jurisdiction; and (3) when joinder would destroy subject 12 matter jurisdiction. See id. (citing Fed. R. Civ. P. 19(a); Tick v. Cohen, 787 F.2d 1490, 1493 13 (11th Cir. 1986)). 14 Defendants argue that “[t]he Red Devils and the Mexican League cannot be joined both 15 because their joinder would destroy this Court’s subject-matter jurisdiction, and because 16 Plaintiffs cannot establish personal jurisdiction over them in this Court.” (Defs.’ Mot. 17 11:20–13:27.) Plaintiffs do not address feasibility in their opposition brief. In fact, the words 18 “feasible” and “feasibility” do not appear anywhere in their brief. Consequently, Plaintiffs 19 concede that joining the Red Devils and the Mexican League is not feasible under the second 20 and third circumstances that Rule 19 enumerates. See Civ. L.R. 7.1(f.3.c). They took this pitch 21 and it went right down the middle—strike two. 22 23 C. 24 If the necessary party cannot be joined, the court must then determine whether the party is The Red Devils and Mexican League Are Indispensable Parties. 25 indispensable. Kescoli v. Babbitt, 101 F.3d 1304, 1309 (9th Cir. 1996). Under Rule 19(b), 26 indispensable parties are “persons who not only have an interest in the controversy, but an 27 interest of such a nature that a final decree cannot be made without either affecting that interest, 28 or leaving the controversy in such a condition that its final termination may be wholly 12cv2859 9 1 inconsistent with equity and good conscience.” Shields v. Barrow, 58 U.S. 130, 139 (1854). 2 Rule 19(b) provides the factors that courts should consider in determining if an action should be 3 dismissed because an absent party is indispensable: (1) prejudice to any party or to the absent 4 party; (2) whether relief can be shaped to lessen prejudice; (3) whether an adequate remedy, even 5 if not complete, can be awarded without the absent party; and (4) whether there exists an 6 alternative forum. Fed. R. Civ. P. 19(b); see also Confederated Tribes of Chehalis Indian 7 Reservation v. Lujan, 928 F.2d 1496, 1498 (9th Cir. 1991). Furthermore, “[n]o procedural 8 principle is more deeply imbedded in the common law than that, in an action to set aside a lease 9 or a contract, all parties who may be affected by the determination of the action are 10 indispensable.” Lomayaktewa v. Hathaway, 520 F.2d 1324, 1325 (9th Cir. 1975). 11 Plaintiffs’ primary arguments addressing indispensability are: (1) Defendants fail to meet 12 their burden, in part, because all of the cases cited are distinguishable, and (2) in equity and good 13 conscience, this case should be allowed to proceed regardless of whether the Red Devils and the 14 Mexican League are indispensable. (Pls.’ Mot. 16:24–22:12.) The Court rejects these 15 arguments. Plaintiffs either misread or misunderstand the cited case law, and they also fail to 16 provide any law themselves that provides an avenue for this Court to bypass Rules 12(b)(7) and 17 19 and all of the related case law as they implore the Court do. 18 Rather, in seeking a determination that the Red Devils contracts are invalid, Plaintiffs are, 19 for all practical purposes, attempting to set aside a contract. And it is evident from the 20 allegations in the complaint that the Red Devils, as a party to the alleged contracts, and by 21 extension the Mexican League, are parties that will be affected by any determination regarding 22 the validity of the contracts. If Plaintiffs want to record an earned run against the absent 23 pitchers, Plaintiffs need to face them. Thus, under Lomayaktewa, the Red Devils and the 24 Mexican League are indispensable parties to this action. See Lomayaktewa, 520 F.2d at 1325. 25 Consequently, all four of the Rule 19(b) factors weigh in favor of dismissal. See Fed. R. Civ. P. 26 19(b). And finally, strike three—out. 27 // 28 // 12cv2859 10 1 IV. CONCLUSION & ORDER 2 In light of the foregoing, the Court GRANTS Defendants’ motion to dismiss under Rule 3 12(b)(7) and DISMISSES this action in its entirety. (Doc. 12.) 4 IT IS SO ORDERED. 5 6 DATED: December 19, 2013 7 8 M. James Lorenz United States District Court Judge 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 12cv2859 11
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