United States District Court, M.D. Pennsylvania
REPORT AND RECOMMENDATION
KAROLINE MEHALCHICK, UNITED STATES MAGISTRATE JUDGE.
Gloria Sun Jung Yun commenced this action by filing a pro
se complaint, on July 18, 2017, asserting that
Gladiacoin.com (“Gladiacoin”) and several other
defendants ran a Bitcoin-based Ponzi scheme through which
they fraudulently obtained Yun's bitcoins.(Doc. 1) (Doc.
4). Yun brings claims, not only against the entities and
individuals directly liable for defrauding her (collectively,
“Defendants”), but also against companies and
service providers, such as GoDaddy.com, LLC
(“GoDaddy”), from which Yun seeks
information to prove her claims (collectively,
“Codefendants”). (Doc. 1, at 1-2,
However, if GoDaddy or any other Codefendants “conceal
information and conspire together for bitcoin scam, ”
Yun asserts that she will pursue damages against them as
well. (Doc. 1, at 15, ¶ 71-72).
before the Court is GoDaddy's motion to dismiss the
complaint, filed May 6, 2019, (Doc. 21), on three
grounds: (1) Yun seeks relief only for hypothetical future
conduct; (2) Yun has not pleaded the elements of civil
conspiracy; and (3) none of Yun's allegations gives rise
to a cause of action against GoDaddy.
reasons that follow, the Court recommends that GoDaddy's
motion to dismiss be GRANTED and that GoDaddy be dismissed
from the case.
2017, acting on friends' recommendations, Yun began to
invest bitcoins in Gladiacoin. (Doc. 1, at 5, ¶
5). At the time, Gladiacoin advertised that investors would
“double the bitcoin within 90 days” and promised
daily returns of 2.2% on all deposited bitcoins. (Doc. 1,
at 5, ¶ 5). Gladiacoin claimed to buy bitcoins in
one market and sell them in another market in which bitcoins
had a higher value, “exploiting the difference in price
on difference exchanges.” (Doc. 1, at 8,
¶ 28). Because Yun initially saw returns on her
investment, she borrowed money and increased her investment
from .1 to 4.8 bitcoins. (Doc. 1, at 6, ¶ 6-7).
however, Yun lost 1.3 bitcoins due to a technical error. It
was then that she first contacted defendant William Portillo,
who claimed to have access to Gladiacoin's administrative
and technical support. (Doc. 1, at 6, ¶¶
8-9). Portillo was not able to refund Yun's account,
although it appears Yun did receive .2 bitcoins back into her
account. (Doc. 1, at 6, ¶ 9). Another technical
glitch resulted in Gladiacoin's system being down between
May 18 and May 24, 2017. (Doc. 1, at 6, ¶ 13).
It reopened until June 3, 2017, and then shut down its
accounts for a second time. (Doc. 1, at 6, ¶
14). With her account blocked, Yun was forced to pay an
administrative fee equal to 15% of her deposited bitcoins for
three months. (Doc. 1, at 6, ¶ 16). The end
result: Yun's investments were halved rather than doubled
(Doc. 1, at 6-7, ¶¶ 16-17).
balance of Yun's complaint consists of allegations of
Portillo's ties to Gladiacoin and the ways in which he
knowingly defrauded Yun and others. Despite having disclaimed
any ownership in Gladiacoin, (Doc. 1, at 7, ¶
20), Portillo apparently put up promotional videos on
Facebook and YouTube touting and flaunting the wealth he
obtained by investing with Gladiacoin. (Doc. 1, at
7-8, ¶¶ 22-23, 27, 30-31, 33). Portillo used
other companies, such as Defendants Gladiacoin.us,
Twicecoin.com, and Jet-coin.com, to defraud investors.
(Doc. 1, at 9, ¶¶ 32, 35-36). Yun's
investigations revealed that Defendants are “all
related or copying the same concept of [multi-level
marketing] to scam.” (Doc. 1, at 10, ¶
mentioned, supra, Yun does not allege that GoDaddy
played a role in the Ponzi scheme or multi-level marketing
scam. Rather, because the website Defendants such as
Gladiocoin were hosted and registered with GoDaddy, (Doc.
1, at 4, 11-12, ¶¶ 47, 52), Yun named GoDaddy
as a defendant for the purpose of obtaining information from
GoDaddy to aid in litigating her claim against the primary
“scam site” Defendants, (Doc. 1, at
15, ¶ 71). Asserting purely injunctive relief
against GoDaddy, Yun concedes that she “does not have
any claim or money judgment against [GoDaddy and the other]
Co-Defendants unless co-defendants conceal information and
conspires together for bitcoin scam, ” in which case
Yun will “claim injury for helping [the primary
defendants] by providing such service.” (Doc.
1, at 15, ¶ 72).
appears to assert three causes of action: (1) intentional
misleading and misrepresentation; (2) money laundering; and
(3) racketeering. She seeks millions of dollars in damages
from Defendants and injunctive relief from
Codefendants-unless, of course, Codefendants conceal
information and conspire to further the Defendants' scam.
(Doc. 1, at 10-15).
Motion to Dismiss Standard
12(b)(6) of the Federal Rules of Civil Procedure authorizes a
defendant to move to dismiss for “failure to state a
claim upon which relief can be granted.” Fed.R.Civ.P.
12(b)(6). “Under Rule 12(b)(6), a motion to dismiss may
be granted only if, accepting all well-pleaded allegations in
the complaint as true and viewing them in the light most
favorable to the plaintiff, a court finds the plaintiff's
claims lack facial plausibility.” Warren Gen. Hosp.
v. Amgen Inc.,643 F.3d 77, 84 (3d Cir. 2011) (citing
Bell Atlantic Corp. v. Twombly,550 U.S. 544, 555-56
(2007)). Although a court must accept the fact allegations in
a complaint as true, it is not compelled to accept
“unsupported conclusions and unwarranted inferences, or
a legal conclusion couched as a factual allegation.”
Morrow v. Balaski,719 F.3d 160, 165 (3d Cir. 2013)
(quoting Baraka v. McGreevey,481 F.3d ...