Professional Documents
Culture Documents
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Attorneys for Plaintiff
FEDERAL EXPRESS CORPORATION
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UNITED STATES DISTRICT COURT
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NORTHERN :DISTRICT OF CALIFORNIA
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~ ) FI T AMENDED COMPLAINT
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) 1. Breach of contract .
14 HAMILTON T & COMP ) J2. Breach of Fiduciary
CONNIE C. TRONG I Duty
15 REMINGTON S. INC., RICHARD ·)3. Breach of Agency
FOWLES I S N LAU, CHRISTINE) Duties
GRAMBLING I BARRY MORGAN, AL MAY,) 4. Breach of Implied
ED HARGIS, VICKY DIMALANTA, ) Covenant
DRESDNER ENTERPRISES, INC., ) 5. Negligence
DRESDNER PETROLEUM, H.I. ) 6. Negligent Misrepre-
INTERNATIONAL, C.R. J sentation
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ACQUISITIONS, INC., and )
~ 7. Fraud
KNIGHTSBRIDGE, ) 8. Conversion
) 9. Violation of Racketeer
20 Defendants. )~c' Influenced and Corrupt
________________________________ ) organizations Act
21 (18 U.S.C. §§1961
et 2mL..)
22 10. Unfair Business
Practices .
23 11. False and Misleading
Advertising
24 12. Constructive Trust
13. Accounting
25 14. Money Had and
Received
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15. Declaratory Relief
16. Injunction
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DEMAND FOR JURy TRIAL
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a:~ that defendant Connie C. Armstrong, Jr. (IIAnnstrong") is the
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4. Plaintiff is informed and believes and thereon alleges
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20 Plaintiff. is informed and believes and thereon alleges
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21 that defendant Richard Fowles (IiFowles") was president of
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Hamilton Taft from March 1989 through September 1990, executive
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vice president of Remington from October 1990 until January 1991,
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and chief financial officer of Hamilton Taft thereafter.
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Plaintiff is informed and believes and thereon alleges that
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Fowles resides in California.
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6. Plaintiff is informed and believes and thereon alleges
28 that defendant steven Lau ("Lau") was a'vice president and
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16 FIRST CAUSE OF ACTION
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17 (Breach of contract Against the
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Armstrong Defendants Only)
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19 23. Plaintiff real leges and incorporates by reference
20 paragraphs 1 through 22, inclusive.
21 24. Defendants· conduct constitutes a breach of the payroll
22 tax service contract.
23 25. Federal Express has performed all conditions and
24 covenants on its part to be performed under the payroll tax
25 service contract, except those conditions or covenants excused or
26 prevented by defendants' breach and the wrongful acts and
27 omissions described herein.
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28. Plaintiff realleges and incorporates by reference
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paragraphs 1 through 27, inclusive.
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30. Plaintiff is informed and believes and thereon alleges
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paid when in fact they were not, misapplying or misappropriating
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Federal Express I s funds:; and failing to invest funds as a
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reasonably prudent investor would invest his or her own money.
22 Defendants further breached thefr f.iduciary obligations by
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refusing to provide Federal ExPress immediate and full access to
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all documents and information in defendants' possession, custody
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or control relating to Federal Express's payroll taxes and funds_
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31. As a direct and proximate result of defendants I breach
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of fiduciary duty, plaintiff has suffered damages in an amount to
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be proved at trial.
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32. Plaintiff realleges and incorporates by reference
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paragraphs 1 through 31, inclusive.
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33. Pursuant to the written payroll tax service contract,
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defendants became plaintiff's agent.
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34. Pursuant to its agency relationship, defendants owed a
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duty of loyalty to Federal·Express. This duty of loyalty
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required defendants to disburse Federal Expressls payroll taxes
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harmful to Federal Express's interests. Among other things,
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investments with Federal Express's funds, or investments which
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might expose Federal Express to tax penalties. Defendants also
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possession, custody or control relating to Federal Express's
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payroll taxes and funds.
21 35. Defendants' conduct constitutes a breach of their
22 agency duties.
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36. A~ a direct and proximate cause of defendants' breach
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of their agency duties, plaintiff has suffered damages in an
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amount to be proved at trial.
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reasonable grounds for believing that these representations were
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46. Defendants' representations that they would pay Federal
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Express's payroll taxes in an appropriate manner were made with
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the intent that Federal Express rely on the representatio~s. ·1
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Federal Express was unaware that the representations were false
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and, believing them to be true, was induced to enter into the tax
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service contract and to advance and continue" advancing its
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payroll taxes to defendants.
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47 •. As a direct and proximate result of defendants·
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negligent misrepresentations, Federal Express has suffered
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damages in an amount to be proved at trial.
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.; ~ 16 64. Plaintiff is informed and believes and thereon alleges
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19 of 18 U.S.C. §1962(c). Plaintiff is further informed and
20 believes that this pattern caused injury to plaintiff and others.
21 65. As a proximate result of defendants· pattern of
22 racketeering activity, plaintiff is informed and believes that it
23 has incurred damages consisting of, among other things, exposure
2.4 to penalties for failure" to pay taxes when due, and liability for
25 taxes that defendants failed to pay.
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66. As a direct and proximate result of defendants'
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conduct, plaintiff is entitled to recover treble damages from
28 defendants in an amount to be determined at trial.
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C... " cs~ alleqation in paragraphs 1 through 69, inclusive.
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.: % 77. Plaintiff realleges and incorporates by reference
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19 that defendants are indebted to plaintiff "in the amount of
20 plaintiff's unpaid tax liabilities and penalties, if any, in an
21 amount which is presently unknown but which will be ascertained
22 at trial.
23 79. Neither the whole nor any part of this sum has been
24 paid despite demand therefor. The amount of any such unpaid
25 taxes and penalties is now due and owing to plaintiff.
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80. Plaintiff realleges and incorporates by reference
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paragraphs 1 through 79, inclusive.
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81. Pursuant to the terms of the payroll tax service
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agreement, defendants agreed to indemnify plaintiff for all
8 injuries caused by defendants' conduct. Plaintiff seeks a
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jUdicial declaration that ~his express indemnity is enforceable
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and that defendants must indemnify Federal Express for any unpaid
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83. Plaintiff is entitled to injunctive relief restraining
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19 defendants' possession, custody or. control concerning the use and
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transfer of plaintiff's tax funds. Plaintiff is also entitled to
21· injunctive relief restraining defendants from continuing their
22 wrongful course of conduct described above, and ordering
23 defendants to immediately provide plaintiff full access to all
24 documents and information in defendants' possession, custody or
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control concerning Federal Express1s payroll taxes and funds.
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WHEREFORE, plaintiff prays for relief as follows:
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1. For an injunction r 7straining defendants from
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destroying, removing or altering all documents and information
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18 tax authorities on behalf of Federal Express;
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19 9. For such other and further relief as this court deems
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21 Dated: March 20, 1991
BRONSON, BRONSON & McKINNON
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BY:it:!.{~~
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Attorneys for Plaintiff
25 FEDERAL EXPRESS CORPORATION
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