Martinez v. Universal Background Screening Incorporated

Filing 50

IT IS ORDERED DENYING Guardian's Motion to Dismiss Count 4 39 . (See attached PDF for details). Signed by Senior Judge Frederick J Martone on 6/24/13.(JAMA)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Darlene T. Martinez,

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Plaintiff,

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vs.

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Universal Background Screening, Inc.,
et al.,
Defendants.

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No. CV-12-02183-PHX-FJM
ORDER

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The court has before it defendant Guardian Investigation and Document Services,

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Inc.’s motion to dismiss count 4 of the second amended complaint (doc. 39), plaintiff’s

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response (doc. 43), and Guardian’s reply (doc. 48).

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I

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Plaintiff Darlene Martinez alleges that she was denied employment with Scottsdale

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Healthcare Corporation because Universal Background Screening, Inc. (“UBS”) incorrectly

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reported that in 2009 she was convicted of felony possession of dangerous drugs and

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sentenced to ten months in jail and four years probation. The information actually related

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to a different person named Darlene Ramirez. The false information was allegedly provided

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to UBS by Guardian Investigation and Document Services, Inc. (“Guardian”).

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On September 14, 2012, plaintiff filed her original Complaint against UBS only,

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asserting claims under the Fair Credit Reporting Act, 15 U.S.C. §§ 1681-1681x, and the

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Arizona Consumer Reporting Agencies and Fair Credit Reporting Act, A.R.S. §§ 44-1691-

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1698.01 (“Arizona Fair Credit Reporting Act”). On February 25, 2013, we granted

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plaintiff’s motion for leave to amend her complaint to add Guardian and Scottsdale

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Healthcare as defendants (doc. 23). Defendant Guardian now moves to dismiss Count 4 of

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the Second Amended Complaint, arguing that the claim is barred by the statute of limitations.

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II

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Plaintiff alleges in Count 4 that Guardian negligently or willfully violated § 44-1965

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of the Arizona Fair Credit Reporting Act when it failed to perform a reasonable investigation

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of plaintiff’s disputes and “verified” to UBS that the false information was correct. The

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parties agree that the applicable statute of limitations is A.R.S. § 12-541(5), which imposes

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a one-year filing deadline.

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Guardian contends that plaintiff’s claim accrued no later than May 16, 2011, the last

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date that plaintiff disputed the incorrect report. Therefore, according to Guardian, the statute

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of limitations ran on plaintiff’s state law cause of action no later than May 16, 2012, almost

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a year before plaintiff first named Guardian as a defendant on February 27, 2013.

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“A district court may dismiss a claim ‘[i]f the running of the statute [of limitations]

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is apparent on the face of the complaint.’ ” Cervantes v. Countrywide Home Loans, Inc., 656

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F.3d 1034, 1045 (9th Cir. 2011) (quoting Jablon v. Dean Witter & Co., 614 F.2d 677, 682

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(9th Cir. 1980)). A complaint cannot be dismissed “unless it appears beyond doubt that the

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plaintiff can prove no set of facts that would establish the timeliness of the claim.”

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Hernandez v. City of El Monte, 138 F.3d 393, 402 (9th Cir. 1998) (citation omitted).

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Under Arizona law, a cause of action accrues and the statute of limitations begins to

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run when “the plaintiff knows or with reasonable diligence should know the facts

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underlying” the defendant’s wrongful conduct that caused an injury. Doe v. Roe, 191 Ariz.

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313, 322, 955 P.2d 951, 960 (1998). “Ordinarily, a cause of action accrues when ‘the

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plaintiff knows or should have known of both the what and who elements of causation.’”

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Kool Radiators, Inc. v. Evans, 229 Ariz. 532, 535, 278 P.3d 310, 313 (Ct. App. 2012)
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(emphasis in original). Therefore, plaintiff’s state law cause of action against Guardian did

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not accrue until plaintiff knew, or with reasonable diligence should have known, that

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Guardian supplied UBS with the false information.

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Although the Second Amended Complaint alleges that, on or about April 12, 2011,

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plaintiff first learned that UBS had reported the false information, SAC ¶ 22, the complaint

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is silent as to when plaintiff discovered that Guardian had supplied UBS with the false

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information.

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discover who had supplied UBS with the false information until December 24, 2012, after

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UBS responded to her discovery requests. Within two months of this discovery, plaintiff

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amended her complaint to assert claims against Guardian. Guardian does not dispute the date

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that plaintiff first learned of its identity. Instead, it argues that plaintiff failed to exercise

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reasonable diligence in identifying Guardian as a potential defendant.

Plaintiff asserts in her response to the motion to dismiss that she did not

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A claim may be dismissed on the ground that it is barred by the statute of limitations

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only when “the face of the complaint establishe[s] facts that foreclose[ ] any showing of

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reasonable diligence.” Von Saher v. Norton Simon Museum of Art, 592 F.3d 954, 969 (9th

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Cir. 2010). Because a determination on equitable tolling “often depends on matters outside

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the pleadings, it is not generally amenable to resolution on a Rule 12(b)(6) motion.”

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Supermail Cargo, Inc. v. United States, 68 F.3d 1204, 1206 (9th Cir. 1995) (citation omitted).

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It is not apparent from the face of the Second Amended Complaint that plaintiff’s

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claim against Guardian under the Arizona Fair Credit Reporting Act is time barred. Because

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it does not appear beyond doubt that plaintiff can prove no set of facts that would establish

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the timeliness of her claim, the motion to dismiss on statute of limitations grounds is denied.

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III

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IT IS ORDERED DENYING Guardian’s motion to dismiss Count 4 (doc. 39).

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DATED this 24th day of June, 2013.

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