United States District Court, M.D. Florida, Orlando Division
GREGORY A. PRESNELL UNITED STATES DISTRICT JUDGE.
Matter comes before the Court on Defendant Ronald
Montano's Motion for Judgment on the Pleadings (Doc. 67)
and the Commodity Futures Trading Commission's
(“CFTC”) Response (Doc. 78).
Complaint alleges that, between September 2013 and December
2016, Montano (along with co-defendant Montano
Enterprises) acted as an affiliate marketer and
commodity trading advisor (“CTA”) and
“fraudulently solicited millions of prospective
customers to open and fund illegal, off-exchange binary
options trading accounts through websites operated by
unregistered binary options brokers.” Compl. ¶ 1.
Montano allegedly conducted at least thirty-five such
fraudulent marketing campaigns. Id. Prospective
customers were advised to open and fund binary options
accounts in order to obtain access to “automated
trading software that purported to generate astronomical
profits with no risk of loss.” Id. ¶ 2.
The materials for the marketing campaign made false and
misleading statements about the software. For example, they
included fake accounts showing consistent profits and no
losses, individuals pretending to have profited by using the
software, and false representations of actual automated
binary options trading and results using the software.
Id. The marketing campaigns succeeded, and at least
10, 000 customers deposited sums amounting to over $2.5
million in order to initially fund their accounts, which each
required a minimum deposit of $250. Id. ¶ 4.
For each customer that viewed one of the online marketing
campaigns and opened and funded a binary options account,
Montano received between $250-350. Id. ¶ 5.
Montano also earned commissions from distributing
solicitations that included other materially false or
misleading statements made by affiliate marketers.
Id. The CFTC claims that Montano's actions
violated the Commodity Exchange Act and accompanying
regulations. Id. ¶ 8.
are four counts pled in the Complaint: Count I alleges
options fraud; Count II alleges CTA fraud; Count III alleges
fraudulent advertising; and Count IV alleges unlawful use of
a manipulative and deceptive device, scheme, or
Rule of Civil Procedure 8(a)(2) requires “a short and
plain statement of the claim showing that the pleader is
entitled to relief so as to give the defendant fair notice of
what the claim is and the grounds upon which it rests.
Conley v. Gibson, 355 U.S. 41, 47 (1957),
overruled on other grounds, Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 127 S.Ct. 1955 (2007).
complaint contains claims of fraud or mistake, however, Rule
9(b) imposes a heightened pleading standard, requiring that
the circumstances constituting fraud be stated with
particularity. See Brooks v. Blue Cross & Blue Shield
of Fla., 116 F.3d 1364, 1381 (11th Cir. 1997). This
particularity requirement is satisfied if the complaint
alleges “facts as to time, place, and substance of the
defendant's alleged fraud, specifically the details of
the defendant's allegedly fraudulent acts, when they
occurred, and who engaged in them.” U.S. ex rel.
Matheny v. Medco Health Sols., Inc., 671 F.3d 1217, 1223
(11th Cir. 2012) (quoting Hopper v. Solvay Pharm.,
Inc., 588 F.3d 1318, 1324 (11th Cir. 2009)). Alternative
means can also satisfy Rule 9(b), provided that the
circumstances of the alleged fraud are pleaded with
on the pleadings is appropriate where there are no material
facts in dispute and the moving party is entitled to judgment
as a matter of law. Riccard v. Prudential Ins. Co.,
307 F.3d 1277, 1291 (11th Cir. 2002) (internal quotations
omitted). Thus, the standard of review for a motion for
judgment on the pleadings is almost identical to that used to
decide motions to dismiss. Doe v. Board of County
Comm'rs, Palm Beach County, Fla., 815 F.Supp. 1448,
1449 (S.D. Fla. 1992). Thus, when considering a motion for
judgment on the pleadings, the Court must accept all
well-pleaded facts in the complaint as true and draw all
reasonable inferences in favor of the non-movant.
Garfield v. NDC Health Corp., 466 F.3d 1255, 1261
(11th Cir. 2006).
first argues that the Complaint is an impermissible shotgun
pleading, and thus, he is entitled to judgment on the
pleadings. In support of his contention, he points to
the opening paragraph of each count in the Complaint:
“[t]he allegations in the foregoing paragraphs are
incorporated by reference as if fully set forth
herein.” It is true that this sort of repetition is a
hallmark of shotgun pleading. However, the headings and
content of each count are more than sufficient to put Montano
on notice of the claims against him. The allegations are
clearly organized by topic. While the opening paragraph in
each count is problematic, it does not render it impossible
to know which allegations of fact are intended to support
which claims for relief. The Complaint is long, but the facts
are complex. The Complaint is adequately pled.
Sufficient Particularity in Counts that Sound in Fraud (All
argues that that the Complaint fails to plead its fraud
counts with sufficient particularity under Rule 9(b). All
four of the fraud counts are sufficiently pled. While the
Complaint does not allege the exact time and location of the
fraud, under the circumstances, it is pleaded with enough
particularity to satisfy the heightened standard. Details
about the name, relevant time period, type of false
statement, who created the statements, and how those