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Matyev v. Kapustin

United States District Court, D. New Jersey

April 18, 2017

CHINGIZ MATYEV, et al., Plaintiffs,
v.
SERGEY KAPUSTIN, IRINA KAPUSTINA, MICHAEL GOLOVERYA, VLADIMIR SHTEYN, IGOR ZADOROZHNIY, ISKANDER IBRAGIMOV, TRT INTERNATIONAL, LTD., OLEG MITNIK, G AUTO SALES, INC., GLOBAL AUTO, INC., EFFECT AUTO SALES, INC., SK IMPORTS, INC., GLOBAL CARGO OY, AUCTION AUTO USA, INC., ATC LOGISTIC OY, et al., Defendants.

          ANNA V. BROWN MARIA TEMKIN BROWN LEGAL CONSULTING, LLC On behalf of Plaintiffs.

          EKATERINA SCHOENEFELD SCHOENEFELD LAW FIRM LLC On behalf of Defendant Iskander Ibragimov.

          SUZANA DAS DAS LAW LLC On behalf of Defendants TRT International, LTD and Oleg Mitnik.

          IRINA KAPUSTINA Pro Se Defendant.

          MICHAEL GOLOVERYA Pro Se Defendant.

          VLADIMIR SHTEYN Pro Se Defendant.

          OPINION

          NOEL L. HILLMAN, U.S.D.J.

         This case is a companion to Akishev v. Kapustin, Civil Action No. 13-7152 (NLH/AMD). Both cases concern a “bait-and-switch” fraudulent scheme masterminded and operated by defendant, Sergey Kapustin, and allegedly assisted by other defendants. The Plaintiffs allege that the scheme used deceptive online advertising aimed at luring international customers to wire funds for automobile purchases and then switching to higher prices, misrepresenting mileage, condition and location and ownership of these vehicles, extorting more funds, and failing to deliver the paid-for vehicles. Presently before the Court is the motion of Defendants Oleg Mitnik and his company TRT International, LTD to dismiss Plaintiffs' claims against them. For the reasons expressed below, Defendants' motion will be denied.

         BACKGROUND & DISCUSSION

         For a detailed recitation of the fraudulent scheme perpetrated by Kapustin and other various defendants, see Akishev v. Kapustin, Civil Action No. 13-7152 (NLH/AMD), Docket No. 272, 358, 395. This case concerns additional Plaintiffs, Chingiz Matyev, Sergey Smirnov, and Igor Zuev, all citizens of Eastern Europe who, like the Plaintiffs in Akishev v. Kapustin, used Kaputin's websites to purchase a car from the United States to be shipped overseas, wired money to Kapustin, but never received any vehicle or a refund of their money.[1]

         The current motion to dismiss is filed by Defendant Oleg Mitnik and his company, Defendant TRT International, LTD, which are not parties to the Akishev action.[2] Plaintiffs claim in this case that Mitnik and TRT financed, provided services to, and received profit from the operation of the fraudulent New Jersey dealerships. More specifically, Plaintiffs claim that in 2011-2012, Mitnik and TRT invested funds in the scheme, including financing the bait vehicles and the luring websites, transported the “switched” vehicles, and received profit on their investment in the scheme. Plaintiffs claim that Mitnik and TRT were put on notice of illegal activities since at least November 2013 when the victims filed their complaint in Akishev v. Kapustin, but nonetheless continued to participate in unlawful activities through November 2014.

         Defendants argue two bases for why Plaintiffs' complaint should be dismissed. First, Defendants argue that this Court lacks subject matter jurisdiction over this action under RJR Nabisco, Inc. v. European Community, 136 S.Ct. 2090, 2111 (2016), which held, “Section 1964(c) requires a civil RICO plaintiff to allege and prove a domestic injury to business or property and does not allow recovery for foreign injuries.” Defendants argue that the foreign Plaintiffs have not suffered any injuries in the United States, and Plaintiffs therefore cannot maintain their RICO claims against them, and no other basis for jurisdiction can be exercised over their state law claims. The Court rejected this same argument in Akishev v. Kapustin, and will do so again here, adopting the reasoning expressed in that case. See Akishev v. Kapustin, 2016 WL 7165714, at *5-*8 (D.N.J. 2016) (explaining, in part, “A person responsible for a United States-based fraudulent scheme to defraud people overseas should not escape liability under a federal law that permits private causes of action to redress that fraud simply because the scheme targets foreign citizens over the internet”).

         Defendants' second basis for the dismissal of Plaintiffs' complaint against them is that Plaintiffs' claims are bare-bone conclusory allegations that fail to meet the ...


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