Judge William Skretny
Lucariello and Ge, in their answer, asserted counterclaims against Zhang on the basis of fraud and unjust enrichment. Defendants alleged they had provided to Zhang and his family services totally $195,000 and that Zhang still owed them $15,000. Zhang moved to dismiss these counterclaims under Rule 12(b)(6) of the Federal Rules of Civil Procedure. The court concluded that the fraud counterclaim did not sufficiently detail where and when Zhang's allegedly false statement were made. The court also concluded that the unjust enrichment counterclaim did sufficiently allege specific facts as required under the statute. The court found that the nature of the allegations set forth in defendants' answer had the potential makings of a properly pleaded fraud claim since defendants presumably knew when and where Zhang made his statements to them. The court reasoned that it was highly probable that given the chance to amend, defendants could satisfy the statute's particularity standard. The court also noted that it would be unduly harsh and prejudicial to deny defendants the opportunity to cure their initial pleading failures. Thus, Zhang's motion to dismiss was denied, and defendants were granted leave to file an amended answer.
