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Natalia v. Tax Credits, LLC

United States District Court, D. Rhode Island

July 25, 2016

DAWN NATALIA; LAWRENCE NATALIA; and GOOSE & GANDER, LLC, Plaintiffs,
v.
TAX CREDITS, LLC, Defendant.

          Dawn Natalia, Plaintiff, represented by Richard G. Galli & David Jesse Oliveira, David Oliveira, Esq..

          Lawrence Natalia, Plaintiff, represented by Richard G. Galli & David Jesse Oliveira, David Oliveira, Esq..

          Goose & Gander, LLC, Plaintiff, represented by Richard G. Galli & David Jesse Oliveira, David Oliveira, Esq..

          Tax Credits, LLC, Defendant, represented by Rachelle R. Green, Duffy & Sweeney, LTD..

          MEMORANDUM AND ORDER

          WILLIAM E. SMITH, Chief District Judge.

         Before the Court is a Request for Entry of Default filed by Plaintiffs Dawn Natalia, Lawrence Natalia, and Goose & Gander, LLC ("Plaintiffs' Motion") (ECF No. 5), and a Motion to Dismiss for Lack of Personal Jurisdiction and Objection to Plaintiffs' Motion filed by Defendant Tax Credits, LLC ("Defendant's Motion") (ECF No. 8). Plaintiffs also filed a Reply in Support of their Motion and an Objection to Defendant's Motion ("Plaintiffs' Reply") (ECF No. 9). After careful consideration, both motions are DENIED for the reasons set forth below.

         I. Background[1]

         Plaintiff Goose & Gander, LLC ("G&G") is a Rhode Island limited liability company with a principal place of business in Rhode Island. G&G is owned by Plaintiffs Dawn and Lawrence Natalia. Defendant Tax Credits, LLC ("TCL") is a Delaware limited liability company with a principal place of business in New Jersey. On March 7, 2014, Plaintiffs contacted TCL via TCL's website and indicated that Plaintiffs were interested in selling a Massachusetts film tax credit. (Compl. ¶ 7, ECF No. 1.) A representative of TCL, hereafter referred to as "CEO, " responded, and TCL ultimately helped Plaintiffs sell the credit to another Rhode Island company. (Id. ¶¶ 9-11.)

         On March 25, 2014, Plaintiffs contacted CEO for advice on financing a new project: a feature length film. (Id. ¶ 12.) Plaintiffs wanted advice on where to look for lender or investor financing. (Id.) In response, CEO offered to secure the financing, and Plaintiffs accepted the offer. (Id. ¶¶ 13-14.)

         CEO began to report progress as soon as March 28, 2014, e-mailing Plaintiffs that she had four lenders who were interested in the project. (Id. ¶ 16.) On May 29, 2014, CEO e-mailed that she had $25, 000 promised for the project. (Id. ¶ 18.) Plaintiffs and CEO were in contact on June 3, June 20, and June 24 via e-mail. (Id. ¶¶ 19-21.) CEO reported that she had $25, 000 already obtained and tens of thousands more promised. (Id. ¶ 21.) On June 25, CEO assured Plaintiffs that they could expect more than $1 million in funding from her efforts. (Id. ¶ 22.) By July 9, CEO was promising an additional $250, 000 each from three more lenders. (Id. ¶ 23.) Based on these assurances, Plaintiffs began putting effort and money into their project. (Id. ¶ 24.)

         By July 16 and 17, CEO claimed that she had already wired money to Plaintiffs' bank account in Rhode Island. (Id. ¶¶ 26-27.) She told them the same on July 23 and August 6. (Id. ¶¶ 29-30.) Plaintiffs also received an e-mail purportedly from TCL's attorney claiming that the funding was on track. (Id. ¶ 34.) During this period, CEO sent Plaintiffs two wire transfer "proofs" from Sovereign Bank that purported to show two money transfers of $750, 000 from TCL to Plaintiffs' Rhode Island bank account. (Id. ¶ 35.) On August 8, CEO sent what appeared to be a confirmation from Santander Bank, assuring Plaintiffs that the wire transfers had been initiated. (Id.) Plaintiffs never received the money. (Id.) Plaintiffs confirmed with their bank, Bank of America, that no wire transfers were pending for their account and that the confirmations CEO had sent them appeared to be fraudulent. (Id. ¶ 36.) On August 11, CEO terminated the project. (Id. ¶ 37.)

         Plaintiffs believe that TCL's activities on the project were almost entirely fabricated, including the documentation CEO sent to Plaintiffs. (Id. ¶ 36.) No money was ever turned over to Plaintiffs despite CEO's promises. (Id. ¶ 35.) Plaintiffs claim they relied on CEO's assurances in advancing their project, expending both time and money. (Id. ¶ 24.)

         II. Discussion

         A. Plaintiffs' Motion ...


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