Kennedy Mcdow Et Al V Betty Harris Et Al

Key Facts

Deceased Name

Issues

• The court examines whether Plaintiffs Kennedy McDow and the Estate of Lily McDow have sufficiently pleaded a claim for financial elder abuse under California Welfare and Institutions Code § 15610.30(a) against Defendant Bank of America, N.A. The claim alleges that BANA assisted in the elder abuse of Lily McDow by her daughters through various actions including advising co-defendants to obtain power of attorney, refusing to allow Lily to remove a defendant from the account, and facilitating withdrawals of Lily's funds. The court finds the claim inadequately pleaded because Plaintiffs fail to allege that BANA had actual knowledge of wrongful conduct by the co-defendants, which is required for liability under the aiding and abetting standard.
• The court recommends granting Defendant Bank of America, N.A.'s motion to dismiss under Fed. R. Civ. P. 12(b)(6) with leave to amend the complaint. The court finds the financial elder abuse claim inadequately pleaded because Plaintiffs have not established that BANA possessed actual knowledge of the wrongful conduct by the co-defendants, which is necessary to establish liability under the aiding and abetting standard. The court notes that amendment would not be futile and that Plaintiffs should be afforded an opportunity to cure the pleading deficiencies.

Holdings

Remedies

• The court recommends granting the motion to dismiss with leave to amend the complaint.
• The court recommends granting leave to amend the complaint.

Legal Principles

• For aiding and abetting liability under financial elder abuse claims, there must be actual knowledge of wrongful conduct by co-defendants, not constructive knowledge. Plaintiffs must plead facts showing the defendant knew of the third party's wrongful conduct, not just ordinary bank services that effectuate abuse.
• California Financial Elder Abuse law (Cal. Welf. & Inst. Code § 15610.30) prohibits taking, secreting, appropriating, obtaining, or retaining property of an elder (65+ years old) for wrongful use or with intent to defraud. Aiding and abetting liability requires the defendant to know the other party's conduct constitutes a breach of duty and give substantial assistance or encouragement to that conduct.
• Federal Rule of Civil Procedure 15(a) provides that leave to amend pleadings should be granted freely when justice so requires. Courts should grant leave to amend unless the pleading could not possibly be cured by alleging other facts. However, conclusory allegations will not be accepted in amended complaints.
• Rule 12(b)(6) standard requires a complaint to contain sufficient factual matter to state a claim that is plausible on its face. Courts must accept well-pleaded factual allegations as true and draw all reasonable inferences in favor of the non-moving party. To survive dismissal, plaintiffs must plead facts demonstrating entitlement to relief, not just conclusory allegations.

Precedent Name

• Bell Atlantic Corp. v. Twombly
• Conservation Force v. Salazar
• Das v. Bank of Am., N.A.
• Ashcroft v. Iqbal
• Lopez v. Smith
• Bortiz v. JPMorgan Chase Bank, N.A.
• Wilkerson v. Wheeler

Executor Name

Cited Statute

• 28 U.S.C. § 636(b)(1)(B)
• 28 U.S.C. § 1654
• Elder Abuse and Extortion Act
• 28 U.S.C. § 636(b)(1)(C)
• California Welfare and Institutions Code

Executor Appointment

Judge Name

Passage Text

• In sum, because Plaintiffs have not sufficiently pleaded (1) a direct wrongful taking by BANA or (2) BANA's assistance in a wrongful taking by its codefendant(s) with actual knowledge of such wrongdoing, they have not stated a claim for financial elder abuse under Cal. Welf. & Inst. Code § 15610.30(a) against BANA.
• Accordingly, the undersigned RECOMMENDS that BANA's motion to dismiss (Doc. 91) be GRANTED with leave to amend.
• To state such a claim, the plaintiff must plead that the defendant 'knows the other's conduct constitutes a breach of duty and gives substantial assistance or encouragement to the other to so act.' Id. at 744. When 'a bank provides ordinary services that effectuate financial abuse by a third party, the bank may be found to have 'assisted' in the financial abuse only if it knew of the third party's wrongful conduct.' Id. at 745.