IRVINE, Calif., Dec. 27, 2021 (GLOBE NEWSWIRE) -- Plutos Sama Holdings, Inc. ("PSH") announced that it has been [tentatively] successful in squashing Platinum Fortune, LP's ("Platinum") petition to dismiss a cause of action in which PSH alleges Platinum, along with other defendants, engaged in bribery and other methods in violation of the Racketeering and Corrupt Organizations Act ("RICO") and various other federal and state law claims to usurp PSH's rightful beneficial rights to SHNT Ltd. and Jagex Ltd. The original lawsuit was filed in the US District Court for the Central District of California on January 21, 2021, and is captioned Plutos Sama Holdings, Inc. v. Jagex et al. case #8:2021cv00133.
PSH is a private equity company in the business of taking control positions in domestic and international distressed and contentious residential and commercial real estate ventures, micro-lending, securitizations, law firms, restaurants, mortgage servicing platforms, and eSports.
The defendant, Platinum, argued that alleged RICO Act violations (referred to in the lawsuit as "the third cause of action") should be dismissed because PSH failed to provide the necessary particularity required under Rule 9(b), and does not allege any overt acts committed by Platinum in furtherance of the conspiracy, or that Platinum agreed to participate in a RICO conspiracy. To satisfy the Rule 9(b) standard, RICO complaints must allege: (1) the precise statements, documents, or misrepresentations made; (2) the time and place of and person responsible for the statement; (3) the content and manner in which the statements misled the plaintiffs; and (4) what the defendants gained by the alleged fraud.
In response to Platinum's motion to dismiss, the plaintiff PSH asserted that the contentions are sufficient to allege that Platinum agreed to participate in a conspiracy, and that allegations of an agreement to participate in the broader conspiracy involving the commission of predicate acts is sufficient to establish a violation of section 1962(d), which provides liability for those who have conspired to violate RICO's other substantive sections.
In a "Tentative Order Regarding Motion to Dismiss" issued on December 17, 2021, the US District Court for the Central District of California stated that PSH elaborated significantly on certain allegations of specific activities, which support the inference that Platinum agreed to participate in a conspiracy in violation of RICO laws by attempting to acquire Jagex while concealing the true source of funding for the transaction.
Specifically, the Court held that "these allegations establish that Belle Liu [a representative of a Platinum limited partner called Huang] knowingly sent at least two emails claiming that the source of funds for Platinum's attempted purchase of Jagex came from a third-party, instead of from Yan Jinggang [Jagex's former closely held owner] in an effort to conceal the funding source from Plutos and outside lawyers and bankers. The allegations include the dates the emails were sent, who they were sent to, what the subject matter was, and why Liu allegedly misled the recipients about the true source of funds. This is adequate to allege that Liu committed two violations of the wire fraud statute. The allegations also state that Liu did so with the knowledge and approval of Huang, Platinum's limited partner, and Zhu, another agent acting on behalf of Huang. As a distinct legal entity, Platinum is not coextensive with Huang or his agents, but in this case there is sufficient evidence to infer that Platinum agreed to the conspiracy. Plutos alleged specific activities that support the inference that Platinum agreed to participate in a conspiracy in violation of RICO by attempting to acquire Jagex while concealing the true source of the funding."
In light of these findings, the Court found that Plutos did indeed allege facts with sufficient particularity to state a claim under 18 U.S.C. § 1962(d) against Platinum, and subsequently Platinum's motion to dismiss was tentatively denied.
"We are pleased with the Court's tentative ruling with a detailed and complete rejection of Platinum's motion to dismiss on the RICO counts only," commented a spokesperson from PSH. "Filing motions to dismiss are standard operating procedure for virtually all civil RICO cases, and many of these motions are successful. And in cases where the appellate courts address a RICO matter, the majority of rulings are for the defendants. RICO claims must meet very strict requirements, and plaintiffs that allege a violation of RICO laws must be prepared to justify their claims with detailed, precise and unambiguous evidence - which is precisely what the Court has tentatively stated we have done. We remain very confident in the merits of our case and look forward to moving this litigation ahead expeditiously and appropriately."
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Plutos Sama Holdings, Inc.
Plutos Sama Holdings, Inc. is a private equity company in the business of taking control positions in domestic and international distressed and contentious residential and commercial real estate ventures, micro-lending, securitizations, law firms, restaurants, mortgage servicing platforms, and eSports.
For more information, visit www.plutosholdings.com.
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