Ryskamp v. Looney et al

MOTION to Dismiss the Verified Corrected Derivative 11 Complaint for Breach of Fiduciary Duty and Unjust Enrichment

D. Colo.June 25, 2010

LEGAL_US_W # 64543051.1 UNITED STATES DISTRICT COURT DISTRICT OF COLORADO Civil Action No. 10-CV-00842 CMA-KLM DENIS RYSKAMP, Derivatively on Behalf of BOULDER GROWTH & INCOME FUND, INC., Plaintiff, v. JOEL W. LOONEY, DEAN L. JACOBSON, RICHARD I. BARR, JOHN S. HOREJSI, and SUSAN L. CICIORA, Defendants, and BOULDER GROWTH AND INCOME FUND, INC., Nominal Defendant. NOMINAL DEFENDANT BOULDER GROWTH AND INCOME FUND, INC., AND THE REVIEW COMMITTEE MEMBERS’ MOTION TO DISMISS PURSUANT TO F.R.C.P. 8(a), 12(b)(6), AND 23.1 Nominal Defendant Boulder Growth and Income Fund, Inc. (the “Fund”) and Defendants Joel W. Looney, Dean L. Jacobson, and Richard I Barr (the “Review Committee Members”) hereby move for themselves, and on behalf of the Fund, pursuant to Rules 8(a), 12(b)(6), and 23.1 of the Federal Rules of Civil Procedure, to Case 1:10-cv-00842-CMA-KLM Document 32 Filed 06/25/10 USDC Colorado Page 1 of 4 LEGAL_US_W # 64543051.1 - 2 - dismiss both claims asserted by Plaintiff Denis Ryskamp (“Plaintiff”) in his Verified Corrected Derivative Complaint for Breach of Fiduciary Duty and Unjust Enrichment (the “Amended Complaint”). Pursuant to Rules 12(b)(6) and 23.1, Review Committee Members move to dismiss Claims 1 and 2 on the ground that the claims are derivative in nature. Because the claims are derivative in nature, Maryland law requires that Plaintiff make a demand on the Fund’s Board of Directors (the “Board”) demanding that this action be brought by and in the name of the Fund. If the Board refuses to bring an action after investigating Plaintiff’s demand - as it did in this instance - Plaintiff can only maintain an action in the name of the Fund if he alleges with the requisite particularity that the Fund wrongfully refused his demand. The Amended Complaint fails to meet this pleading standard as required by both Maryland and federal law, and therefore must be dismissed. Pursuant to Rule 8(a), the Review Committee Members also move to dismiss Claims 1 and 2 on the ground that Plaintiff has not adequately pled the claims for breach of fiduciary duty and unjust enrichment. Because the Amended Complaint fails to meet Rule 8(a)’s pleading standard, Plaintiff’s claims should be dismissed for this additional reason. The Review Committee Members’ Motion is based on the Motion, the Memorandum of Law in Support of the Motion, the Request for Judicial Notice with Exhibits thereto filed and served concurrently herewith, the allegations in Plaintiff’s Amended Complaint and documents relied upon and referenced therein, along with the pleadings, records and files in this action, those matters of which this Court may take Case 1:10-cv-00842-CMA-KLM Document 32 Filed 06/25/10 USDC Colorado Page 2 of 4 LEGAL_US_W # 64543051.1 - 3 - judicial notice, and such further evidence and argument as may be presented prior to, or at the time of, any hearing on this Motion. All matters outside the pleadings submitted with this Motion are either specifically referenced in the Amended Complaint, incorporated by reference in the Amended Complaint, or are matters of public record capable of judicial notice under Rule 201 of the Federal Rules of Evidence. Therefore, the Court should not convert the motion to a motion for summary judgment. If the Court declines to take judicial notice of certain matters submitted with the Motion in the Request for Judicial Notice, the Fund requests that the Court simply not consider the matters outside the pleadings. Dated: June 25, 2010 Respectfully Submitted, By: s/ William F. Sullivan William F. Sullivan Joshua G. Hamilton D. Scott Carlton PAUL, HASTINGS, JANOFSKY & WALKER LLP 515 South Flower Street, 25th Floor Los Angeles, California 90071-2228 Telephone: (213) 683-6000 Facsimile: (213) 627-0705 E-mail: williamsullivan@paulhastings.com Christian H. Hendrickson SHERMAN & HOWARD L.L.C. 633 Seventeenth Street, Suite 3000 Denver, Colorado 80202-3622 Telephone: (303) 297-2900 Facsimile: (303) 298-0940 E-mail: chendrickson@shermanhoward.com Attorneys for Nominal Defendant Boulder Growth and Income Fund, Inc. and Defendants Joel W. Looney, Dean L. Jacobson, and Richard I. Barr Case 1:10-cv-00842-CMA-KLM Document 32 Filed 06/25/10 USDC Colorado Page 3 of 4 CERTIFICATE OF SERVICE I hereby certify that on June 25, 2010, I electronically filed the foregoing Motion to Dismiss Pursuant to F.R.C.P. 8(a), 12(b)(6), and 23.1 with the Clerk of Court using the CM/ECF system which will send notification of such filing to the following e-mail addresses: Kip Shuman kip@shumanlawfirm.com Attorney for Plaintiff Denis Ryskamp Matthew Groves mgroves@messner.com Attorney for Defendants Susan L. Ciciora and John S. Horejsi By: s/ William F. Sullivan Attorney for Nominal Defendant Boulder Growth and Income, Inc. and Defendants Joel W. Looney, Dr. Dean L. Jacobson, and Richard I. Barr Case 1:10-cv-00842-CMA-KLM Document 32 Filed 06/25/10 USDC Colorado Page 4 of 4