2010-04-15_County_of_Hawaii_Motion_to_Dismiss_Counter_Claim_to_Expunge_Lis_Pendens_ORIG

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The County then filed suit against Defendants alleging various actions, including a claim for violation of the false claims act contained in Hawaii Revised Statutes ("HRS") § 46-171 for the submission of the invoices for$3.2 million.2 Not surprisingly,Defendants deny the invoices represent a false claim and they allege they are entitled to 33.2 milli(in. In their attempt to pressure the County to drop its claims, Defendants have also alleged fraudulent conveyance of the underlying land and filed a lis pendens. Defendants realize that the lis pendens will put a"cloud"on the title of the land which may stop the affordable housing project. However, Defendants' claim of fraudulent transfer is without merit and must be dismissed and the lis pendens must be expunged. Defendants counterclaim alleges four causes of action against the County: 1)breach of contract, 2)quantum meruit, 3) intentional interference with contract, and 4) fraudulent transfer. See Exhibit `B". Defendants subsequently filed a"Notice of Pendency of Action"("lis pendens"). See Exhibit "C". Defendants allege that the fraudulent conveyance cause of action against the County provides the basis for the lis pendens.3 See 12 of Declaration of Kurt Fritz ("Fritz Dec'), Exhibit "C". The County hereby moves to dismiss Counts 1 (breach of contract) and Count 4 (fraudulent transfer) of the Complaint and moves to expunge the lis pendens.4 Z HRS§46-171 prohibits false claims against the Counties. Similar statutes apply to claims submitted to the State of Hawaii and to the federal government. See HRS§661-7 and 31 U.S.C.A. §3730. 3 The County filed its Complaint against Defendants in state court on July 1,2009. See Exhibit"A". The Complaint alleges various causes of action,including intentional and negligent misrepresentations,fraudulent inducement and a violation of the false claims act,HRS§46-171. After being served with the Complaint,Defendants improperly removed this case to federal court. On February]],2010 Judge Kay issued his Order granting the County's motion to remand. Judge Kay agreed with Magistrate Kobayashi that the removal was"objectively unreasonable". "Exhibits"A"-"C"are pleadings filed in this case and are attached hereto for the Court's convenience. Exhibits"D'="1"are documents related to the subject project,authenticated by the Declaration of Jeremy McComber,attached as Exhibit"J". To the extent this Court deems it necessary to rely upon these exhibits,the County requests this motion be deemed a partial motion for summary judgment pursuant to Rule 56 of the Hawaii Rules of Civil Procedure("HRCP")and Richards v.Midkiff,48 Haw.32, 396 P.2d 49(1964). 2