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8 United States District Court 9 Central District of California

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11 CASABLANCA DESIGN CENTER, Case № 2:23-cv-02155-ODW (PDx)

INC.,

12 Plaintiff, ORDER DENYING MOTION FOR 13 v. RECONSIDERATION [70] 14 CLOSETS BY DESIGN, INC. et al., 15

Defendants. 16

17 18 I. INTRODUCTION 19 Plaintiff Casablanca Design Center, Inc. (“Casablanca”) brings this action 20 against Defendants Closets by Design, Inc., CBD Franchising, Inc., Closet World, 21 Inc., and Frank Melkonian. (Second Am. Compl. (“SAC”), ECF No. 40.) Casablanca 22 moves for reconsideration of the Court’s order (“Dismissal Order”) dismissing its 23 third and fourth causes of action for violations of the Racketeer Influenced and 24 Corrupt Organizations (“RICO”) Act. (Mot. Recons. (“Mot.” or “Motion”), ECF 25 No. 70.) For the following reasons, the Court DENIES Casablanca’s Motion.1 26 27

28 1 Having carefully considered the papers filed in connection with the Motion, the Court deemed the matter appropriate for decision without oral argument. Fed. R. Civ. P. 78; C.D. Cal. L.R. 7-15. 1 II. BACKGROUND 2 On November 8, 2024, the Court granted Defendants’ motion to dismiss and 3 dismissed Casablanca’s third and fourth causes of action for violations of the RICO 4 Act. (Order Granting Mot. Dismiss (“Dismissal Order”), ECF No. 69.) In its 5 Dismissal Order, the Court found Casablanca lacked standing to assert RICO Act 6 violations, because Casablanca failed to allege sufficient facts to establish concrete 7 loss and proximate causation between its alleged injuries and Defendants’ conduct. 8 (Id. at 5–8.) 9 Casablanca now moves for reconsideration pursuant to Federal Rule of Civil 10 Procedure (“Rule”) 60(b) and California Central District Civil Local Rule (“Local 11 Rule”) 7-18. (Mot. 4–5.) The Motion is fully briefed. (Opp’n, ECF No. 71; Reply, 12 ECF No. 76.) 13 III. LEGAL STANDARD 14 Under Rule 60(b), “the court may relieve a party or its legal representative from 15 a final judgment, order, or proceeding.” The Rule provides several bases for seeking 16 this relief, including: (1) mistake, inadvertence, surprise, or excusable neglect; 17 (2) newly discovered evidence; (3) fraud, misrepresentation, or misconduct by an 18 opposing party; (4) a void judgment; (5) a satisfied judgment; and (6) any other reason 19 that justifies relief. Fed. R. Civ. P. 60(b). Motions for relief pursuant to Rule 60(b) 20 “are addressed to the sound discretion of the district court.” Casey v. Albertson’s Inc., 21 362 F.3d 1254, 1257 (9th Cir. 2004). 22 Under Local Rule 7-18, the grounds on which a party may move for 23 reconsideration are limited to: (a) “a material difference in fact or law from that 24 presented to the Court that, in the exercise of reasonable diligence, could not have 25 been known to the party moving for reconsideration at the time the Order was 26 entered;” (b) “the emergence of new material facts or a change of law occurring after 27 the Order was entered;” or (c) “a manifest showing of a failure to consider material 28 facts presented to the Court before the Order was entered.” C.D. Cal. L.R. 7-18. 1 IV. DISCUSSION 2 Casablanca moves for reconsideration of the Court’s proximate cause analysis 3 for RICO standing. (Mot. 6–10.) Relying on Rule 60(b)(1) and Local Rule 7-18, 4 Casablanca asserts that the Court began its analysis on a “factual error,” failed to 5 consider material facts, incorrectly characterized allegations as admissions, and relied 6 upon overruled case law. (Id. at 2, 6.) Defendants respond that Casablanca fails to 7 identify new facts or law that provide a legitimate basis for reconsideration. 8 (Opp’n 1.) Defendants are correct. 9 First, Casablanca argues that the Court’s proximate cause analysis “began with 10 a factual error” because the Court raised the issue of standing based on Casablanca’s 11 assertion that “it is not a direct victim of Defendants’ false advertising.” (Mot. 6 12 (quoting Dismissal Order 5).) Casablanca contends that it made this statement in 13 connection to its Lanham Act claim—not its RICO claim—and that “[t]here is no 14 support in the law for the proposition that a competitor in the marketplace cannot be 15 directly harmed by another competitor’s false advertising.” (Mot. 4, 6 (emphasis 16 omitted).) But the Court did not rely on Casablanca’s assertion that it was not a direct 17 victim or on the identified “proposition” to reach its proximate cause finding. Rather, 18 the Court based its proximate cause analysis on Casablanca’s allegations that it 19 suffered lost potential customers, sales, money, and resources, and suffered weakened 20 market position and damaged good will. (See Dismissal Order 6–7.) After 21 considering Casablanca’s allegations, the Court found that Casablanca “fail[ed] to 22 show concrete loss and proximate causation between its lost market opportunities and 23 Defendants’ conduct.” (Id. at 7.) As the Court did not rely on Casablanca’s asserted 24 “factual error,” this argument is not a proper basis for reconsideration. 25 Second, Casablanca improperly asserts the same arguments and allegations it 26 previously raised and does not point to new or relevant material facts that the Court 27 did not already consider in its analysis of proximate cause. See C.D. Cal. L.R. 7-18 28 (“No motion for reconsideration may in any manner repeat any oral or written 1 argument made in support of, or in opposition to, the original motion.”). Specifically, 2 Casablanca argues the Court failed to consider why it lost sales, money and resources 3 and incorrectly characterized its allegations as an “admission.” (See Mot. 7–9.) This 4 argument relies entirely on allegations from the Second Amended Complaint. (Id. 5 at 7–9.) The Court properly “accepted as true” Casablanca’s well-pleaded allegations 6 and considered them in its analysis. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); (see 7 also Dismissal Order 6–7.) Without raising new material facts, Casablanca’s “mere 8 disagreement with the Court’s determination is insufficient grounds for 9 reconsideration.” AECOM Energy & Constr., Inc. v. Ripley, No. 2:17-cv-05398- 10 RSWL (SSx), 2019 WL 2610953, at *9 (C.D. Cal. Apr. 24, 2019). 11 Lastly, Casablanca challenges the case law cited by the Court in its Dismissal 12 Order. But these arguments fail to present material difference in law or emergence of 13 new change of law to establish a basis for reconsideration. C.D. Cal. L.R. 7-18. 14 In a footnote, Casablanca first contends the rule articulated in Chaset v. 15 Fleer/Skybox International, LP, 300 F.3d 1083 (9th Cir. 2002) that “a RICO plaintiff 16 must show proof of concrete financial loss, and not mere injury to a valuable 17 intangible property interest” was overruled by Diaz v. Gates, 420 F.3d 897 (9th Cir. 18 2005). (Mot. 10 n.2). As “[a]rguments raised only in footnotes . . . are generally 19 deemed waived,” the Court declines to consider this argument. Est. of Saunders v. 20 Comm’r, 745 F.3d 953, 962 n.8 (9th Cir. 2014). Nevertheless, Diaz did not overrule 21 Chaset’s rule; rather, it “clarified” the standard and held that injury to a property 22 interest is sufficient to establish RICO standing. 420 F.3d at 899; cf. Canyon County 23 v. Syngenta Seeds, Inc., 519 F.3d 969, 975 (9th Cir. 2008) (explaining that the Ninth 24 Circuit “requires that a plaintiff asserting injury to property to allege ‘concrete 25 financial loss’”). 26 Casablanca next challenges the Court’s reliance on Anza v. Ideal Steel 27 Corporation, 547 U.S. 451 (1991). Casablanca argues the Supreme Court in Bridge v. 28 Phoenix Bond & Indemnity Co., 553 U.S. 639 (2008) distinguished Anza “on the basis 1 || there were ‘independent factors’ that accounted for plaintiff’s injury.” (Mot. 10.) But 2|| Bridge is inapplicable as the facts are not analogous to this case—Bridge does not 3 || involve a RICO claim between market competitors. Rather, as the Court already explained in its Dismissal Order, this case is more like Anza, where the Supreme 5 || Court found the causal connection between the alleged lost profits and defendants’ 6 || conduct to be too attenuated because the harm “may have been produced by 7 || independent factors.” 547 U.S. at 459-60. Thus, Casablanca’s reliance on Bridge 8 | does not raise proper grounds for reconsideration. 9 As discussed above, Casablanca fails to raise a basis for reconsideration of the 10 || Court’s Dismissal Order. While Casablanca may disagree with the Court’s ruling, 11 | mere disagreement with the Dismissal Order is an insufficient basis for 12 || reconsideration. Ripley, 2019 WL 2610953, at *9. 13 Vv. CONCLUSION 14 For the reasons discussed above, the Court DENIES Casablanca’s Motion for 15 | Reconsideration. (ECF No. 70.) 16 17 IT IS SO ORDERED. 18 Se “i 19 May 13, 2025 GER WE x v7 21 22 3 OTIS D. WRIGHT, I 4 UNITED STATES DISTRICT JUDGE

25 26 2713 This assertion is incorrect. In Bridge, the Supreme Court held the plaintiffs established RICO 28 || standing because “unlike in... Anza, there are no independent factors that account for respondents’ injury.” 553 U.S. 639, 658 (2008) (emphasis added).