Response in Support re 46 Motion to Dismiss for Lack of Jurisdiction — Marshall v. Prestamos CDFI, LLC (Dkt. 51, E.D. Pa. No. 5:21-cv-04337)

Record facts

U.S. District Court for the Eastern District of Pennsylvania · No. 5:21-cv-04337-JMG · Doc. 51 · 2022-06-24 · Docket on CourtListener

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IN THE UNITED STATES DISTRICT COURT 
FOR THE EASTERN DISTRICT OF PENNSYLVANIA 
 
 
ALICIA MARSHALL, DANIEL 
PRONSKY, PARIS TOWNSEND, 
NANCILEE HOLLAND, LEONA 
OWSLEY, KOLAWOLE AHMADOU, 
KIANA DERVIN, KRISTINA 
HENDERSON, DUSTIN INNIS, KELLY 
STALNAKER and JAMIE JONES, 
individually and on behalf of all others 
similarly situated, 
 
 
 
Plaintiffs, 
 
 
 
v. 
 
PRESTAMOS CDFI, LLC and 
CHICANOS POR LA CAUSA, INC., 
 
 
 
 
Defendants. 
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Case No. 5:21-cv-04337-JMG 
 
 
 
 
 
 
 
 
REPLY IN SUPPORT OF DEFENDANTS’ MOTION TO DISMISS PLAINTIFFS’ 
SECOND AMENDED COMPLAINT 
 
 
 
 
BALLARD SPAHR LLP 
HERRERA ARELLANO LLP 
 
Marcel S. Pratt (Pa. ID 307483) 
Roy Herrera* 
Michael R. McDonald (Pa. ID 326873) 
Daniel A. Arellano* 
Alexa L. Levy (Pa. ID 327973) 
Jillian Andrews* 
1735 Market Street, 51st Floor 
530 East McDowell Road, Suite 107-150 
Philadelphia, PA 19103 
Phoenix, AZ 85004 
T: 215-665-8500 
T: 602-567-4820 
F: 215-864-8999 
Roy@ha-firm.com 
PrattM@ballardspahr.com 
Daniel@ha-firm.com 
McDonaldM@ballardspahr.com 
Jillian@ha-firm.com 
LevyA@ballardspahr.com 
 
 
*pro hac vice admission to be sought 
 
Attorneys for Defendants
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Congress was clear that a lender’s compliance with the PPP is for the SBA to police, not 
for private borrowers; courts nationwide have recognized that the PPP does not entitle borrowers 
to a private cause of action. Permitting this case to proceed against Prestamos and Chicanos Por 
La Causa, Inc. (“CPLC”)—two mission-driven community institutions, the latter of which is not 
even a lender—is not what Congress intended. 
Plaintiffs’ claims are meritless, in any event, and Plaintiffs’ opposition repeatedly dodges 
key precedent or misdirects on the issues. For the reasons set forth in Defendants’ Opening Brief 
and below, the Court should dismiss the Second Amended Complaint (“SAC”) with prejudice. 
ARGUMENT 
I. 
Plaintiffs do not have standing to bring their claims. 
Plaintiffs’ survey of the boilerplate standards governing jurisdictional challenges does not 
meaningfully confront the reality that courts repeatedly have dismissed claims just like Plaintiffs’ 
for lack of Article III standing. See Def. Br. at 13–15. Their only counterargument is that their loan 
applications, unlike other PPP plaintiffs, had made it to approval. See Opp. Br. at 6. But Plaintiffs 
were not any more “entitled” to a PPP loan from Prestamos than any other applicant, approved or 
not. Indeed, SBA regulations state several times that an individual does not have a right to a loan. 
See, e.g., 86 Fed. Reg. 8283, 8285 (Feb. 5, 2021) (authorizing SBA at any time to investigate a 
recipient’s eligibility for a loan (citing 15 U.S.C. § 634(b)(11)); id. at 8288 (explaining that SBA 
and lender may determine even a disbursed loan is not eligible for forgiveness). 
This, too, demonstrates why any harm Plaintiffs suffered is not traceable to Prestamos. In 
light of the myriad explanations for why an “approved” borrower may be denied a loan, and 
lacking any detailed factual claims to the contrary, Plaintiffs’ allegations do not plausibly 
demonstrate that their non-receipt of a PPP loan was “because of [Prestamos’s] inaction.” 
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Ironworks Dev. Llc v. Truist Bank, No. 21-cv-32, 2021 U.S. Dist. LEXIS 238037, at *7–8 (W.D. 
Va. Dec. 7, 2021) (“[T]he Complaint does not foreclose the possibility that [plaintiff’s] loan was 
rejected because of the conduct of the SBA, or [plaintiff] itself; or simply because funds were more 
limited than applicants.”). And while Defendants’ motion underscores it multiple times, Plaintiffs’ 
opposition fails to dispute that the SAC offers other reasons why borrowers did not receive their 
loans, including that some borrowers’ banks rejected attempts by Prestamos to fund a PPP loan. 
See Def. Br. at 4, 9, 16, 32, 41. 
Plaintiffs’ other arguments fail. Their contention that they suffered a concrete harm because 
they might be “obligated to repay,” and “precluded [from] applying for forgiveness” of, loans that 
they allegedly did not receive is illogical—none of them were responsible for repaying a non-
existent loan. Opp. Br. at 5. Nothing in the law foreclosed Plaintiffs from withdrawing their 
applications from Prestamos if dissatisfied. Finally, although a plaintiff’s well-pleaded claims 
about losing money to which they are entitled (though Plaintiffs were not entitled to any money 
here) may present a cognizable injury-in-fact, Plaintiffs’ allegations are “conclusory assertion[s] 
of money lost [paired] with a request that a defendant pay up,” which are legally insufficient. See 
Def. Br. at 15 (citations omitted). 
At the very least, the Court should dismiss Plaintiffs’ claims insofar as they are brought 
under the laws of states in which the named Plaintiffs were not injured. The cases Plaintiffs cite, 
Opp. Br. at 6–7, do not address this issue. Neale v. Volvo Cars of N. Am., LLC, 794 F.3d 353 (3d 
Cir. 2015) (district court’s dismissal of nationwide class was not subject of appeal); In re Horizon 
Healthcare Servs. Inc. Data Breach Litig., 846 F.3d 625 (3d Cir. 2017) (involving claim under 
federal law); Bombin v. Sw. Airlines Co., 529 F. Supp. 3d 411 (E.D. Pa. 2021) (Gallagher, J.) 
(addressing class-action waiver); Bodor v. Maximus Fed. Servs., Inc., No. 19-cv-5787, 2021 U.S. 
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Dist. LEXIS 203823 (E.D. Pa. Oct. 22, 2021) (Gallagher, J.) (federal-law claim). Plaintiffs try but 
fail to distinguish this Court’s decision in Talbert v. Am. Water Works Co., 538 F. Supp. 3d 471 
(E.D. Pa. 2021) (Gallagher, J.), rejecting plaintiffs’ attempts to bring a nationwide class action 
under the laws of states in which the named plaintiffs did not suffer injury. The standing analysis 
did not hinge on, as plaintiffs contend, the Talbert plaintiffs failure to identify essential contract 
terms; rather, the Talbert plaintiffs, like the named plaintiffs here, tried to claim injuries under the 
laws of states to which they had no connection. 
  
Plaintiffs are exactly right, though, that at this stage, the “standing inquiry focuses solely 
on the class representatives.” Opp. Br. at 6 (quotation omitted). And that inquiry involves whether 
a named plaintiff can “demonstrate standing for each claim he seeks to press.” Neale, 794 F.3d at 
359 (3d Cir. 2015) (quotation omitted) (emphasis added). As this Court and others in the Circuit 
have recently held, this means that plaintiffs cannot bring claims based on state laws under which 
they themselves were not injured. Def. Br. at 17; see also, e.g., In re Sensipar Antitrust Litig., 
MDL No. 2895, 2022 U.S. Dist. LEXIS 43561, at *46–48 (D. Del. Mar. 11, 2022); Cohen v. 
Subaru of Am., Inc., No. 20-cv-8442, 2022 U.S. Dist. LEXIS 42511, at *17–18 (D.N.J. Mar. 10, 
2022); In re Niaspan Antitrust Litig., 42 F. Supp. 3d 735, 758 (E.D. Pa. 2014). 
II. 
Plaintiffs cannot use state law to enforce Prestamos’s obligations under the PPP. 
Plaintiffs’ claims are not viable because they seek to enforce Prestamos’s compliance with 
a federal statute that does not give them the right to do so. “The federal judiciary will not engraft 
a remedy on a statute, no matter how salutary, that Congress did not intend to provide.” Mass. Mut. 
Life Ins. Co. v. Russell, 473 U.S. 134, 145 (1985) (quotation omitted). Honoring this fundamental 
precept, courts nationwide routinely dismiss state-law claims predicated on alleged violations of 
federal laws Congress did not permit private plaintiffs to enforce—including the PPP. See Def. Br. 
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at 18–19.1 Plaintiffs contend their claims are different because they are more direct. Opp. Br. at 9–
10. But it is unclear why that means Plaintiffs’ state-law claims incorporating alleged technical 
obligations under a federal program should be treated any differently than those asserted, and 
rejected, in the cases Defendants cite.  
Plaintiffs also fault Defendants for failing to address preemption doctrine. Opp. Br. at 7–8. 
But preemption is not a basis for Defendants’ Motion. Whether federal law preempts state law is 
a distinct question from whether a private party can sue to enforce that federal law. See, e.g., Qwest 
Corp. v. City of Santa Fe, 380 F.3d 1258, 1266 (10th Cir. 2004); W. Air Lines, Inc. v. Port Auth. 
of N.Y. & N.J., 817 F.2d 222, 225 (2d Cir. 1987). 
Consistent with this position, Defendants do not contend that the CARES Act’s lack of a 
private right of action will “preclude” any and all state claims that may “refer to or incorporate 
some element” of the law. Bukowski v. Wells Fargo Bank, N.A., 757 F. App’x 124, 128–29 (3d 
Cir. 2018) (citation omitted) (cleaned up). This is the reasonable holding of courts addressing 
violations of independent substantive obligations that touch on—but do not entirely overlap with—
federal law or regulation. See id. at 129 (upholding claim that lender deceived the borrowers about 
their satisfaction of certain federal program guidelines, similar to Wigod v. Wells Fargo Bank, 
N.A., 673 F.3d 547 (7th Cir. 2012)); Scott v. Gate Gourmet, Inc., No. 20-cv-11033, 2021 U.S. Dist. 
LEXIS 33020 (C.D. Cal. Feb. 22, 2021) (employer committed wrongful termination and other 
breaches when firing employees in advance of receiving CARES Act funds); Cave v. Saxon Mortg. 
                                                 
1 See also, e.g., Shehan v. United States DOJ, No. 20-cv-500, 2020 U.S. Dist. LEXIS 244022, at 
*30–32 (S.D. Ohio Dec. 29, 2020) (rejecting fraud-related state-law claims against PPP lender in 
part because of the CARES Act’s lack of a private right of action). 
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Servs., Inc., No. 11-cv-4586, 2012 U.S. Dist. LEXIS 75276 (E.D. Pa. May 30, 2012) (lender 
breached express contract terms promising to consider the borrower’s eligibility for a loan 
modification). 
Contrast those cases with the circumstances here, where Plaintiffs admit, without hesitation 
or equivocation, that they seek to enforce Prestamos’s obligations under the PPP, and not just bring 
a claim that merely relates or refers to the PPP. Opp. Br. at 13 (contract’s “central purpose” is to 
“fund Plaintiffs’ loans”); 13 (PPP loan funding is “mandatory” under federal regulations); 22 
(alleged “failure to fund . . . implicates other serious violations”). Congress could not have intended 
to bar private enforcement of the PPP while at the same time intending to incorporate the PPP 
statutory scheme “into the Loan Documents” for dissatisfied borrowers to enforce under state law. 
Opp. Br. at 14. 
III. 
The SAC fails to state a claim for breach of contract. 
Plaintiffs identify no term in the Promissory Note where Prestamos promised to fund their 
loans. They point, instead, to terms setting out their obligations as borrowers in the event a loan 
was funded. They try also to graft SBA regulations onto the contract documents, despite no 
contractual terms that incorporate those regulations and no legal doctrine that does so. 
To hold a lender liable for not having funded a putative borrower’s loan, there must have 
been a promise by the lender actually to fund the loan. It is not enough that certain documents 
(even a promissory note) reference a loan and the terms on which a borrower will repay it. That is 
the holding of Mark Andrew of Palm Beaches, Ltd. v. GMAC Commercial Mortgage Corp., 265 
F. Supp. 2d 366, 380–81 (S.D.N.Y. 2003), a case directly on point that Plaintiffs do not 
meaningfully distinguish. There, as here, a promissory note and other loan documents identified a 
loan by amount and set out the terms on which the borrower would secure and repay it. But the 
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court held that there was no contractual obligation to lend money because none of the documents 
contained “any obligation, promise, or undertaking” by the lender to fund any loan. Id. 
Plaintiffs cite to Gallagher v. Upper Darby Township, 539 A.2d 463, 473 (Pa. Commw. 
1988), and its discussion of the contract doctrine of necessary implication, whereby a court may 
sometimes supply an omitted essential term. See Restatement (Second) of Contracts § 204. But 
“[t]he court may imply a missing term in a parties’ contract only when it is necessary to prevent 
injustice and it is abundantly clear that the parties intended to be bound by such term.” Kaplan v. 
Cablevision of PA, Inc., 671 A.2d 716, 720 (Pa. Super. 1996). Here, Plaintiffs are obligated to 
repay the loan (if at all) only in the event a loan is made; where there is no loan, there is no 
obligation to repay it. Moreover, it is by no means “abundantly clear” that the parties intended to 
be bound by a term that would commit Prestamos to fund the loan: had the parties intended such 
a term, they could have just as easily included it, say, in a loan commitment letter. 
Plaintiffs are also wrong that the loan documents incorporate PPP regulations. First, such 
incorporation appears nowhere in the contract text. Second, the principle that “[s]tatutes that 
pertain to the subject matter of a contract form a part of the contractual obligation as if actually 
incorporated into the contract,” Willisch v. Nationwide Ins. Co. of Am., 852 F. Supp. 2d 582, 607 
(E.D. Pa. 2012), is one specific to insurance contracts. Id. (“Specifically, applicable statutory 
provisions of insurance law are deemed incorporated into insurance contracts.”). Even in that 
context, courts reject incorporation of regulations (as opposed to statutes). Santos v. Ins. Placement 
Facility of Pa., 626 A.2d 1177 (Pa. Super. 1993). Plaintiffs’ cited cases are not contrary. See 
Heyman v. Citimortgage, Inc., No. 14-cv-1680, 2019 U.S. Dist. LEXIS 128238 (D.N.J. June 27, 
2019) (incorporating HAMP regulations as implied contract terms where dealings expressly 
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referenced those regulations); Skurka Aerospace, Inc. v. Eaton Aerospace, LLC, No. 08-cv-1565, 
2011 U.S. Dist. LEXIS 33489 (N.D. Ohio Mar. 29, 2011) (same, with respect to FAA regulations). 
Plaintiffs’ mischaracterization of the equities does not help them, either. It is grossly unfair 
to characterize Defendants’ not disputing factual allegations that must, for purposes of Rule 
12(b)(6), be accepted as true as somehow constituting their admission. And regardless of the merits 
of Plaintiffs’ “quasi-estoppel” theory, Plaintiffs provide no authority for the proposition that the 
doctrine may bar a legal defense to a claim in addition to the claim itself. Defendants enjoy the 
right to defend against Plaintiffs’ baseless allegations. 
IV. 
Plaintiffs agreed to release all claims against Prestamos. 
Plaintiffs contend that Prestamos’s alleged breach invalidates the release in the Note. See 
Opp. Br. at 15. But Prestamos did not breach the Note, see supra; accordingly, the release cannot 
be invalid on that basis. In any event, Plaintiffs are wrong that an allegedly breaching party cannot 
take advantage of a contractual release—it is common (and is the case here) for releases expressly 
to encompass contract claims. See, e.g., Charbonneau v. Chartis Prop. Cas. Co., No. 13-cv-4323, 
2015 U.S. Dist. LEXIS 85428, at *32 (E.D. Pa. July 1, 2015); Equitrans Servs., LLC v. Precision 
Pipeline, LLC, 154 F. Supp. 3d 189, 196–97 (W.D. Pa. 2015). 
Further, Plaintiffs’ interpretation of the release language is confined to seven words out of 
a hundred—that the release encompasses Lender conduct “on or prior to the date hereof.” Opp. 
Br. at 15–16 (citing Note § 10). According to the rest of the contract language, however, Prestamos 
is released from all existing and future claims, which “have accrued or may accrue,” “arising out 
of or in any way connected to” Prestamos’s extension of credit to Plaintiffs or any of its conduct. 
Note § 10 (emphasis added). Because Plaintiffs’ claims clearly arise out of the extension of credit 
Prestamos allegedly agreed to when Plaintiffs executed their notes, the release applies. 
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For this reason, Plaintiffs’ reliance on Bowersox is misplaced. See Opp Br. at 26 (citing 
Bowersox Truck Sales & Serv. v. Harco Nat’l Ins. Co., 209 F.3d 273, 279 (3d. Cir. 2000)). The 
release language at issue in Bowersox did not expressly include future accruing claims, and 
therefore the court found that a bar of such claims was not “within the contemplation of the parties 
when the release was given.” Id. (internal citation omitted). By contrast, the release in the Note 
explicitly bars future accruing claims and, therefore, precludes Plaintiffs’ claims, no matter that 
they accrued “10 days after the date Plaintiffs’ notes were executed and returned to Prestamos.” 
Cf. Opp. Br. at 15. Finally, this language accords with the policy animating the PPP, which sought 
to incentivize lender participation without enmeshing them in costly litigation brought by 
dissatisfied borrowers. The release squarely bars Plaintiffs from bringing their claims. 
V. 
Plaintiffs fail to state a claim for violation of the CA UCL. 
Because Plaintiffs do not plausibly allege that Prestamos breached any legal obligation 
owed to them under the CARES Act or the PPP program, they cannot establish Prestamos’s 
conduct was “unlawful” for purposes of the California Unfair Competition Law. Cal. Bus. & Prof. 
Code § 17200; Se. Pa. Transp. Auth. v. Gilead Scis., Inc., 102 F. Supp. 3d 688, 707 (E.D. Pa. 
2015). Prestamos’s discretion regarding its funding of PPP loans extended not just to whether to 
approve or deny applications, but to determining whether an applicant was “ineligible” for a PPP 
loan entirely. Profiles, Inc. v. Bank of Am. Corp., 453 F. Supp. 3d 742, 748 (D. Md. 2020). 
Plaintiffs also fail to “tether” the alleged unfairness element to a legislatively declared policy, as 
no part of the CARES Act required Prestamos to fund every PPP loan applicant, regardless of 
eligibility. 
Plaintiffs are wrong that Sonner v. Premier Nutrition Corp., 971 F.3d 834 (9th Cir. 2020), 
has no application at the pleadings stage. Sonner itself was a 12(b)(6) case. See id. at 838 
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(restitution claim at issue had been dismissed in response to 12(b)(6) motion); Elizabeth M. Byrnes, 
Inc. v. Fountainhead Com. Cap., LLC, No. 20-cv-4149, 021 U.S. Dist. LEXIS 227046 (C.D. Cal. 
Nov. 24, 2021) (dismissing equitable PPP claim under Sonner at the pleadings stage). It is of no 
moment that Plaintiffs alleged equitable relief in the alternative. See Sharma v. Volkswagen AG, 
524 F. Supp. 3d 891, 907 (N.D. Cal. 2021) (“The issue is not whether a pleading may seek distinct 
forms of relief in the alternative, but rather whether a prayer for equitable relief states a claim if 
the pleading does not demonstrate the inadequacy of a legal remedy. On that point, Sonner holds 
that it does not.”). Plaintiffs’ restitution claim further fails because they neither possessed the funds 
at issue nor have an ownership interest in them; Prestamos retained discretion to decline 
disbursement of PPP funds for which Plaintiffs were ineligible. Profiles, 453 F. Supp. 3d at 748. 
VI. 
Plaintiffs fail to state a claim under the ICFA. 
Plaintiff Ahmadou’s claim under the Illinois Consumer Fraud and Deceptive Business 
Practices Act (“ICFA”) fails, firstly, because it duplicates Plaintiffs’ breach of contract claim. See 
Turner v. Orthopedic & Shoulder Ctr., S.C., 82 N.E.3d 801, 807 (Ill. Ct. App. 2017). The “falsely 
communicated” promises alleged in the SAC to support this claim all stem from the contract 
documents. SAC ¶ 280 (pointing to promise to act as a “Lender”; holding Plaintiff Ahmadou to 
obligations “in consideration of Prestamos . . . making the . . . loan[s]”; and promise to “fulfill the 
terms of its written agreements”). Plaintiffs now add, in their response, that Prestamos induced 
Plaintiff Ahmadou to enter into the agreement by “accepting plaintiff’s application and the SBA’s 
approval,” Opp. Br. at 18, thereby “locking” him in to relying on Prestamos for the loan. But that 
theory of inducement appears nowhere in the SAC’s allegations purporting to support the ICFA 
claim. Anyway, Plaintiffs still have failed to allege that Prestamos had the requisite intent to 
deceive. Cohen v. Am. Sec. Ins. Co., 735 F.3d 601, 608 (7th Cir. 2013); Avery v. State Farm Mut. 
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Auto Ins. Co., 835 N.E.2d 801, 844 (Ill. 2005) (“[A] ‘deceptive act or practice’ involves more than 
the mere fact that a defendant promised something and then failed to do it.”). 
The ICFA claim also fails because Plaintiffs have failed to plead it with particularity. They 
contend that the heightened pleading standard does not apply because Plaintiff Ahmadou alleges 
“unfair” business practices rather than “deceptive” ones under the statute. But the law is clear that 
“unfair” practices allegations that “are clearly premised upon the primary claim” of deception still 
trigger Rule 9. Camasta v. Jos. A. Bank Clothiers, Inc., 761 F.3d 732, 737 (7th Cir. 2014) (“Simply 
adding language of ‘unfairness’ instead of ‘misrepresentation’ does not alter the fact that 
[plaintiff’s] allegations are entirely grounded in fraud under the ICFA.”). And Plaintiffs continue 
to make nothing but circular and “bare assertion[s] of unfairness without describing in what 
manner the [conduct] either violate[s] public policy or [is] oppressive.” Robinson v. Toyota Motor 
Credit Corp., 775 N.E.2d 951, 963 (Ill. 2002). Simply reciting the legal standard is not enough. 
VII. 
Plaintiffs fail to state a claim under the cited Ohio statutes. 
Plaintiffs do not dispute that the Ohio Deceptive Trade Practices Act, like the Lanham Act, 
bars consumer suits. See Borden v. Antonelli Coll., 304 F. Supp. 3d 678, 685 (S.D. Ohio 2018). 
Nor do they dispute that they must allege an “injury to a commercial interest in reputation or sales.” 
Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 132 (2014). Instead of 
addressing how they have alleged such an injury, Plaintiffs argue that they state an ODTPA claim 
because, they say, Prestamos induced Plaintiff Stalnaker to enter into the loan agreements without 
intending to perform. Opp. Br. at 20. As with the ICFA claim, however, that theory is not alleged 
in the complaint, which instead rests on the promises allegedly made in the contract documents. 
SAC ¶ 299. That the PPP loan was for Plaintiff Stalnaker’s business does not mean she has suffered 
an injury to a commercial interest in reputation or sales. The ODTPA claim fails. 
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VIII. Plaintiffs fail to allege alter ego claims against CPLC. 
 
Plaintiffs largely avoid discussing the merits of their alter ego allegations against CPLC, 
maintaining instead that they should just be allowed discovery on the issue. Opp. Br. at 10–12. But 
“on a motion to dismiss (or motion for judgment on the pleadings), a court must examine whether 
the facts pleaded state a cause of action on a theory of piercing the corporate veil.” Accurso v. 
Infra-Red Servs., Inc., 23 F. Supp. 3d 494, 510 (E.D. Pa. 2014) (quotation marks and alterations 
omitted, emphasis added). “In other words, a complaint must do more than allege the plaintiff’s 
entitlement to relief. A complaint has to ‘show’ such an entitlement with its facts.” Fowler v. 
UPMC Shadyside, 578 F.3d 203, 211 (3d Cir. 2009) (emphasis added). That some alter ego cases 
present close factual questions precluding even summary judgment is irrelevant where, as here, a 
plaintiff has not pled sufficient facts to make alter ego liability even plausible. See Accurso, 23 F. 
Supp. 3d at 510 (“In relevant cases in which veil piercing theories survive motions to dismiss, the 
plaintiffs pled the quantum of facts necessary to give rise to the reasonable inference that the alter 
ego test could be satisfied.” (quotation marks and alteration omitted)). Plaintiffs are not entitled to 
a fishing expedition based on a mere hunch, and Defendants cannot be faulted for not denying 
allegations they have not yet even had occasion to answer. 
What little efforts Plaintiffs do make to defend the merits of their alter ego theory fall 
woefully short. They first say that CPLC is subject to personal jurisdiction in Pennsylvania court 
because it received loan fees, despite never plausibly alleging that CPLC received loan fees from 
the SBA or that those fees derived from Pennsylvania conduct, while also acknowledging in the 
next sentence that it was Prestamos that was involved in PPP lending. Opp. Br. at 11. They then 
assert that the consolidated financial statement in one instance uses the term “the Organization” to 
refer uniquely to CPLC’s membership interest in various LLCs. Opp. Br. at 11. But that only 
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reinforces the point that CPLC has its own corporate identity separate from that of its subsidiaries. 
Plaintiffs then cite an unpublished Pennsylvania Superior Court case for the proposition that 
consolidated financial statements and annual reports weigh in favor of asserting personal 
jurisdiction over a corporate parent, ignoring that the main factor present in that case was the 
various entities acting “as branches of one functionally-integrated organization.” Williams by 
Williams v. OAO Severstal, No. 938 WDA 2017, 2019 WL 4888570, at *9 (Pa. Super. Ct. Oct. 3, 
2019) (quoting Hooper v. Safety-Kleen Sys., Inc., No. 16-cv-123, 2016 WL 7212586, at *8 (W.D. 
Pa. Dec. 13, 2016). Plaintiffs have simply failed to allege any facts that would plausibly support 
an inference that CPLC exercised control over the day-to-day affairs of Prestamos.  
IX. 
Plaintiffs have waived their unjust enrichment claim. 
 
The motion to dismiss squarely addresses why the SAC does not state a claim for unjust 
enrichment against CPLC. Def. Br. at 44–45. In response, Plaintiffs do not address their unjust 
enrichment claim except to note, in the context of briefing their California consumer protection 
claim, that they allege unjust enrichment in the alternative. Opp. Br. at 17. Failure to make an 
argument in response to a defendant’s motion to dismiss results in waiver of that issue. Celestial 
Cmty. Dev. Corp. v. City of Phila., 901 F. Supp. 2d 566, 578 (E.D. Pa. 2012). Plaintiffs have 
therefore waived their unjust enrichment claim. 
CONCLUSION 
For the foregoing reasons, and for the reasons set forth in its Opening Brief, Defendants 
respectfully request that the Court dismiss Plaintiffs’ SAC, with prejudice. 
 
Dated: June 24, 2022 
BALLARD SPAHR LLP 
 
 
By: /s/ Marcel S. Pratt 
 
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Marcel S. Pratt (Pa. ID 307483) 
 
 
Michael R. McDonald (Pa. ID 326873) 
 
 
Alexa L. Levy (Pa. ID 327973) 
 
 
PrattM@ballardspahr.com 
 
 
McDonaldM@ballardspahr.com 
 
 
 
 
 
LevyA@ballardspahr.com 
 
 
 
HERRERA ARELLANO LLP 
 
 
 
 
Roy Herrera* 
 
 
Daniel A. Arellano* 
 
 
Jillian Andrews* 
 
 
Roy@ha-firm.com 
 
 
Daniel@ha-firm.com 
 
 
Jillian@ha-firm.com 
 
 
*pro hac vice admission to be sought 
 
 
 
Attorneys for Defendants 
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