23 A 00333, 23 B 05875
Plaintiff filed a complaint objecting to Debtor’s discharge under 11 U.S.C. § 523(a)(2). The complaint did not specify whether Plaintiff is proceeding under section 523(a)(2)(A), (B), or both. Plaintiff alleges the Debtor solicited investments for his precious metals business, which Plaintiff subsequently invested in 2019 and 2020. Plaintiff further alleges Debtor’s statements were misrepresentations, that the money was never intended for trading precious metals, and instead was used to further a fraudulent Ponzi scheme. In his motion to dismiss, Debtor argues Plaintiff’s claim is actionable only under section 523(a)(2)(B) because Plaintiff’s allegations revolve around misrepresentations about an insider’s financial condition. Held: While the complaint may contain allegations that respect a financial condition, it also contains other allegations that fall within section 523(a)(2)(A). Plaintiff successfully stated a claim under § 523(a)(2)(A) by putting Debtor on notice of Plaintiff’s claims. The court denied the motion to dismiss.