Reysner v. Navient Solutions, Inc. et al

Filing 48

FINDINGS and RECOMMENDATIONS signed by Magistrate Judge Kendall J. Newman on 11/7/18 Recommending that Defendant's Motion for Summary Judgment 41 be granted in full. Plaintiff's request for further leave to amend the complaint be DENIED . Judgment be entered for defendant. The Clerk of Court be directed to close this case. These Findings and Recommendations are submitted to U.S. District Judge Kimberly J. Mueller; Objections to these F&Rs due within fourteen (14) days. (Mena-Sanchez, L)

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UNITED STATES DISTRICT COURT

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FOR THE EASTERN DISTRICT OF CALIFORNIA

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PIOTR REYSNER,

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No. 2:17-cv-00641-KJM-KJN PS

Plaintiff,

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v.

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FINDINGS AND RECOMMENDATIONS

NAVIENT SOLUTIONS, INC., et al.

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Defendants.

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INTRODUCTION
Presently before the court is a motion for summary judgment filed by defendant Navient

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Solutions, LLC, formerly known as Navient Solutions, Inc. (ECF No. 41.)1 Plaintiff Piotr

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Reysner filed an opposition to the motion, and defendant subsequently filed a reply brief. (ECF

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Nos. 45, 46.)2
After carefully considering the written briefing, the court’s record, and the applicable law,

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the court recommends that defendant’s motion for summary judgment be GRANTED, and that

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plaintiff’s request for further leave to amend be DENIED, for the reasons discussed below.

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The action proceeds before the undersigned pursuant to Local Rule 302(c)(21) after the district
judge permitted plaintiff’s former counsel to withdraw. (ECF No. 29.)
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The motion was submitted for decision without oral argument upon the record and written
briefing pursuant to Local Rule 230(g). (ECF No. 47.)
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BACKGROUND
At this case’s inception, plaintiff alleged that he completely paid off all his student loans

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to defendant Navient Solutions in 2002. (ECF No. 1-1 at 13.) Then, fifteen years later in January

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of 2017, plaintiff was shocked to see that defendant was demanding additional payment for an

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outstanding student loan debt. (Id.) According to plaintiff, defendant “went silent for 15 years”

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and “made no demands for payment nor did [defendant] indicate in those intervening years that

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Plaintiff continued to owe anything.” (Id. at 14.) Furthermore, plaintiff stated that upon

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additional investigation, he found that he did not just pay back his student loans, but he had

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actually overpaid his loans by $47,140.09, because he had relied in good faith on defendant’s

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representations at the time. (Id.) Therefore, plaintiff claimed that not only did he not owe any

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money to defendant, but defendant owed plaintiff the amount he overpaid. (Id. at 16.)

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However, at the summary judgment stage, plaintiff significantly changed his position and

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withdrew many of his previous assertions. (See ECF No. 45.) Indeed, his opposition began with

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the following admission:

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Plaintiff must concede that there are a number of incorrect
statements in his Complaint. Much of it was posturing, a lack of
memory of certain events from long ago, coupled with supreme
frustration. However, whether Plaintiff, for example, did
correspond with Navient during the relevant time periods (contrary
to what Plaintiff alleged in his Complaint), this does not change the
fundamental character of this lawsuit. Simply put, Plaintiff took
out student loans repaid some or all of them, and Navient has no
idea how much is owed, if anything.

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(ECF No. 45 at 1.) Plaintiff further admitted that “[t]his case is about student loan accounting and

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how much, if anything, Plaintiff may still owe on student loans.” (ECF No. 45-3 at 16.) Plaintiff

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no longer asserts that defendant owes plaintiff any money, or that plaintiff overpaid his loans—his

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current argument is that “a balance may or may not be owed” to defendant, and that defendant is

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unable to prove how much money plaintiff owes. (ECF No. 45 at 4; ECF No. 45-3 at 8.)

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For purposes of defendant’s motion for summary judgment, plaintiff disputes almost

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every one of defendant’s proposed undisputed facts, with the exception of a few notable

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concessions. (See ECF No. 45-3.) However, plaintiff largely fails to provide any evidence in

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support of his disputes. Therefore, unless otherwise noted, the basic background facts are deemed
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undisputed, which have been verified from the exhibits and declarations offered by defendant.3

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The undisputed facts show that from 1993 to 2000, plaintiff took out fourteen student

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loans with Sallie Mae, which were subsequently transferred to defendant. (Compl. ¶ 9; ECF No.

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41-3, Ex. 1.) Plaintiff took out four private loans (ECF No. 41-3, Exs. 5, 8, 9, 14), and ten federal

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loans: four subsidized (ECF No. 41-3, Exs. 4, 7, 10, 12) and six unsubsidized (ECF No. 41-3,

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Exs. 1-3, 6, 11, 13). (ECF No. 41-3, Ex. 29.) On November 1, 2001, plaintiff’s subsidized and

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unsubsidized federal loans were consolidated into the amount of $66,791.00 (“federal loans”), as

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evinced by plaintiff’s verified signature on the Federal Consolidation Loan Application and

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Promissory Note. (ECF No. 41-3, Ex. 15; Ex. 41-3, Ex. 31 [“Plaintiff’s Depo.”] 45:23-24.)

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Plaintiff also confirmed that he knew he was obligated to pay back his loans in full. (Plaintiff’s

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Depo. 44:13–46:21.)

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Plaintiff sent Sallie Mae a letter on January 21, 2002, indicating that he was making a

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$26,628.49 payment to pay off all his unconsolidated private loans, and that he was also making

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an $8,000 payment towards his consolidated federal loan.4 (ECF No. 41-3, Ex. 16.) Sallie Mae

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sent plaintiff a letter on February 28, 2002, congratulating him for completely paying off the

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student loans “starred” below—the only loans “starred” were his four private loans. (ECF No.

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41-3, Ex. 17.) Additionally, plaintiff spoke on the phone to a representative of defendant on

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February 28, 2002, who advised plaintiff of his outstanding federal loan and that his next payment

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was due in August of 2003. (ECF No. 41-3, Ex. 18.)

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On March 18, 2004, plaintiff made a $45,000.00 payment towards his federal consolidated

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loan, and he was made aware at the time that this payment would not completely pay off that

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loan. (ECF No. 41-3, Ex. 19.) In addition to being verbally informed twice about his outstanding

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Plaintiff filed voluminous evidentiary objections to defendant’s exhibits. The court has
considered, but declines to address each individual objection here. Unless specifically addressed
in the findings and recommendations, the court overrules those objections as immaterial to the
resolution of the motion and/or frivolous.
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Plaintiff disputes the accuracy of defendant’s asserted amounts of his private loans. (ECF No.
45 at 2.) However, any discrepancies concerning plaintiff’s private loans are not at issue, because
both parties agree that plaintiff fully paid off the private loans. (ECF No. 41-3, Ex. 17.)
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balance, on March 18, 2004, plaintiff accessed his online account and was provided the same

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information. (Iorio Decl. ¶ 28; ECF No. 41-3, Ex. 19.) On September 23, 2005, Plaintiff

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submitted a “Request for Forbearance” to defendant concerning his outstanding federal loan.5

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(ECF No. 41-3, Ex. 20.) On April 22, 2008, plaintiff completed an “Automatic Debit

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Authorization.” (ECF No. 41-3, Ex. 21.) By providing his bank checking account information,

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he permitted his loan servicer to withdraw loan payments.6 (Id.) Moreover, plaintiff admitted

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that he accessed his online account fifteen times from 2003 to 2017, and he also had nine phone

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conversations with representatives of defendant between 2003 and 2008. (ECF No. 41-3, Ex.

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26.)7

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Plaintiff filed a complaint against defendant in Sacramento Superior Court on March 17,

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2017. (ECF No. 1-1.) Defendant filed a notice of removal on March 27, 2017. (ECF No. 1-2.)

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In the complaint, plaintiff asserts claims against defendant for: (1) mistaken receipt; (2) money

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had and received; (3) declaratory judgment and injunctive relief; (4) unjust enrichment/restitution;

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(5) demand for accounting; (6) fraud and conspiracy to commit fraud; (7) negligence/gross

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negligence; (8) violation of the California Fair Debt Collections Practices Act; (9) violation of the

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California Consumer Credit Reporting Act; (10) unlawful business practices; and (11) fraudulent

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business practices. (ECF No. 1-1.) Defendant answered the complaint on June 23, 2017. (ECF

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No. 14.)

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Ultimately, defendant filed the instant motion for summary judgment. (ECF No. 41.)

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Plaintiff disputes that fact because “[t]he purported exhibit was not signed by Plaintiff,” even
though plaintiff’s name is listed on the borrower signature line and the top of the exhibit indicates
that the request was submitted using an “online Electronic Signature process.” (ECF No. 45-3 at
8; ECF No. 41-3, Ex. 20.)
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Plaintiff also disputes that fact because the “exhibit was not signed by Plaintiff.” (ECF No. 45-3
at 8.) However, again, plaintiff’s name is listed on the line for customer signature and the exhibit
shows that “[this] request was submitted using [an] online Electronic Signature process.” (ECF
No. 41-3, Ex. 21.)
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In his admission to those numerous communications, plaintiff raised the single objection that
those communications are irrelevant, because “[a]t it’s heart, this case is an accounting case.
Plaintiff asserts that Navient is unable to prove how much, if any, money he owes. Whether
Plaintiff accessed his online account has no bearing on this fact.” (ECF No. 45-3 at 8-9.)
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LEGAL STANDARD
Federal Rule of Civil Procedure 56(a) provides that “[a] party may move for summary

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judgment, identifying each claim or defense--or the part of each claim or defense--on which

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summary judgment is sought.” It further provides that “[t]he court shall grant summary judgment

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if the movant shows that there is no genuine dispute as to any material fact and the movant is

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entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a).8 A shifting burden of proof

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governs motions for summary judgment under Rule 56. Nursing Home Pension Fund, Local 144

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v. Oracle Corp. (In re Oracle Corp. Sec. Litig.), 627 F.3d 376, 387 (9th Cir. 2010). Under

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summary judgment practice, the moving party:

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always bears the initial responsibility of informing the district court
of the basis for its motion, and identifying those portions of “the
pleadings, depositions, answers to interrogatories, and admissions on
file, together with the affidavits, if any,” which it believes
demonstrate the absence of a genuine issue of material fact.

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Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting then-numbered Fed. R. Civ. P.

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56(c)). “Where the non-moving party bears the burden of proof at trial, the moving party need

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only prove that there is an absence of evidence to support the non-moving party’s case.” In re

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Oracle Corp. Sec. Litig., 627 F.3d at 387 (citing Celotex Corp., 477 U.S. at 325); see also Fed. R.

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Civ. P. 56 advisory committee’s notes to 2010 amendments (recognizing that “a party who does

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not have the trial burden of production may rely on a showing that a party who does have the trial

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burden cannot produce admissible evidence to carry its burden as to the fact”).

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If the moving party meets its initial responsibility, the opposing party must establish that a

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genuine dispute as to any material fact actually exists. See Matsushita Elec. Indus. Co. v. Zenith

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Radio Corp., 475 U.S. 574, 585-86 (1986). To overcome summary judgment, the opposing party

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must demonstrate the existence of a factual dispute that is both material, i.e., it affects the

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outcome of the claim under the governing law, see Anderson v. Liberty Lobby, Inc., 477 U.S.

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242, 248 (1986); Fortune Dynamic, Inc. v. Victoria’s Secret Stores Brand Mgmt., Inc., 618 F.3d

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Federal Rule of Civil Procedure 56 was revised and rearranged effective December 10, 2010.
However, as stated in the Advisory Committee Notes to the 2010 Amendments to Rule 56, “[t]he
standard for granting summary judgment remains unchanged.”
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1025, 1031 (9th Cir. 2010), and genuine, i.e., “‘the evidence is such that a reasonable jury could

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return a verdict for the nonmoving party,’” FreecycleSunnyvale v. Freecycle Network, 626 F.3d

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509, 514 (9th Cir. 2010) (quoting Anderson, 477 U.S. at 248). A party opposing summary

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judgment must support the assertion that a genuine dispute of material fact exists by: “(A) citing

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to particular parts of materials in the record, including depositions, documents, electronically

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stored information, affidavits or declarations, stipulations . . . , admissions, interrogatory answers,

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or other materials; or (B) showing that the materials cited do not establish the absence or presence

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of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the

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fact.”9 Fed. R. Civ. P. 56(c)(1)(A)-(B). However, the opposing party “must show more than the

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mere existence of a scintilla of evidence.” In re Oracle Corp. Sec. Litig., 627 F.3d at 387 (citing

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Anderson, 477 U.S. at 252).

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In resolving a motion for summary judgment, the evidence of the opposing party is to be

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believed. See Anderson, 477 U.S. at 255. Moreover, all reasonable inferences that may be drawn

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from the facts placed before the court must be viewed in a light most favorable to the opposing

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party. See Matsushita, 475 U.S. at 587; Walls v. Cent. Contra Costa Transit Auth., 653 F.3d 963,

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966 (9th Cir. 2011). However, to demonstrate a genuine factual dispute, the opposing party

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“must do more than simply show that there is some metaphysical doubt as to the material

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facts...Where the record taken as a whole could not lead a rational trier of fact to find for the non-

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moving party, there is no ‘genuine issue for trial.’” Matsushita, 475 U.S. at 586-87 (citation

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omitted).

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DISCUSSION

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Before addressing the substantive issues in plaintiff’s claims, it is important to highlight

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plaintiff’s shifting position from the beginning of litigation until now. Plaintiff initially claimed

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that “he overpaid his loans by $47,140.09” and that “Defendant accepted the monies and knew or

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should have known that the money was demanded and paid in error.” (Compl. ¶¶ 15, 28.)

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“The court need consider only the cited materials, but it may consider other materials in the
record.” Fed. R. Civ. P. 56(c)(3). Moreover, “[a] party may object that the material cited to
support or dispute a fact cannot be presented in a form that would be admissible in evidence.”
Fed. R. Civ. P. 56(c)(2).
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According to plaintiff, “Defendant then went silent for 15 years. [It] made no demands for

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payment nor did [it] indicate in those intervening years that Plaintiff continued to owe anything.”

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(Id. ¶ 16.)

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However, at the summary judgment stage plaintiff significantly changed his position,

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claiming that “[a]t it’s heart, this case is an accounting case. Plaintiff asserts that [defendant] is

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unable to prove how much, if any, monies he owes.” (ECF No. 45-3 at 8.) Plaintiff began his

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opposition by admitting that “there are a number of incorrect statements in his Complaint. Much

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of it was posturing, a lack of memory of certain events from long ago, coupled with supreme

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frustration.” (ECF No. 45 at 1.) Plaintiff also no longer appears to argue that he overpaid his

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loans, asserting now that he “repaid some or all of [his student loans]” to defendant. (Id.) He

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further contradicts the claim that defendant “went silent for 15 years,” by now acknowledging

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that he “did correspond with Navient during the relevant time periods,” but just that it “does not

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change the fundamental character of this lawsuit.” (Id.) Moreover, he admitted, “[t]he evidence

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presented shows only this: Student loans were obtained, payments were made, and a balance may

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or may not be owed. That’s it.” (Id. at 4.) Given all those admissions and his complete position

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change from the initial complaint, plaintiff nonetheless confusingly continues to defend each of

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his eleven claims from summary judgment. At the end of his opposition, plaintiff merely asserts

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that “[i]f [the] present causes of action cannot survive, something must.” (Id. at 10.)

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Defendant’s Motion for Summary Judgment

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Defendant moves for summary judgment as to all of plaintiff’s claims. The court

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addresses them in the order they were listed, with the exception of Claim 3 (Declaratory

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Judgment and Injunctive Relief), because that remedy rests on the remaining causes of action.

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Claim 1: Mistaken Receipt

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In response to plaintiff’s first cause of action, defendant argues that the statute of

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limitations bars the claim of mistaken receipt of funds, and that the claim also lacks evidentiary

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support. (ECF No. 41-1 at 14.) The statute of limitations to bring a money paid by mistake claim

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is three years from the discovery of the mistaken payment. Cal. Civ. Proc. Code § 338(d); see

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Holtzendorff v. Housing Authority, 250 Cal. App. 2d 596, 635 (1967).
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In his complaint, plaintiff claimed he overpaid his loans by $47,140.09 and that he relied

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upon defendant’s representations in 2002 that his loans had been fully repaid. (Compl. ¶ 15.)

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Plaintiff also claimed that defendant went silent for fifteen years, only to contact him in January

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of 2017 demanding an additional payment of $21,000.00. (Compl. ¶¶ 16-17.) Plaintiff did not

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assert when he learned of the alleged wrongful payment, just that he demanded a refund of the

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amounts paid in excess of the loan amount, and defendant refused or failed to refund the amount.

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(Compl. ¶¶ 34-35.) Plaintiff later changed his position, stating that he had “repaid some or all of

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[his loans]” and that he “may or may not” owe some balance to defendant. (ECF No. 45 at 1, 4.)

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The undisputed facts show that on November 1, 2001, plaintiff’s federal loans were

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consolidated into the amount of $66,791.00. (ECF No. 41-3, Ex. 15.) Plaintiff sent a letter to

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Sallie Mae on January 21, 2002, acknowledging that he was making a $26,628.49 payment to pay

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off all his unconsolidated private loans and that he was also making a $8,000 payment towards his

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consolidated federal loan. (ECF No. 41-3, Ex. 16.) Plaintiff received a letter from his loan

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servicer on February 28, 2002, showing that only his private loans had been paid off. (ECF No.

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41-3, Ex. 17.) Furthermore, plaintiff concedes that he spoke on the phone to a representative of

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defendant on February 28, 2002, who advised plaintiff that his federal loan remained outstanding

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and the next payment was due in August of 2003. (ECF No. 41-3, Ex. 18.)

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On March 18, 2004, plaintiff made a $45,000.00 payment towards his federal consolidated

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loan, and he was made aware at the time that this payment would not completely pay off his

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federal loan. (ECF No. 41-3, Ex. 19.) In addition to being verbally informed twice about his

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outstanding balance of $58.923.33, on March 18, 2004, plaintiff accessed his online account and

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was provided the same information. (Iorio Depo. at ¶ 28; ECF No. 41-3, Ex. 19.) On September

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23, 2005, plaintiff submitted a Request for Forbearance to defendant for his outstanding federal

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loan (ECF No. 41-3, Ex. 20), and on April 22, 2008, plaintiff completed an Automatic Debit

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Authorization with defendant (ECF No. 41-3, Ex. 21). Moreover, plaintiff concedes that he

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accessed his online account fifteen times from 2003 to 2017, and he also had nine phone

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conversations with representatives of defendant between 2003 and 2008. (ECF No. 41-3, Ex. 26.)

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This evidence indicates that plaintiff was aware of his outstanding federal loan balance at all
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times, and that he would have been aware of any improper payment or ‘mistaken receipt’ by

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2004, but in any event no later than 2008. (ECF No. 41-1 at 15.)

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Plaintiff counters defendant’s argument by asserting that the delayed discovery rule and

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fraudulent concealment allow the statute of limitations to be tolled. (ECF No. 45 at 5-6.)

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However, plaintiff provides no plausible evidence that discovery was somehow delayed allowing

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the claim to survive. He merely states that defendant made no attempts to collect from 2010 to

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2017, ignoring the facts showing that plaintiff was well aware of the pertinent facts from 2002

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through 2008. (Id. at 6.) Plaintiff also provides no evidence beyond speculative assertion that

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defendant fraudulently concealed anything from him. (Id. at 6-7.)

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In sum, plaintiff filed the complaint on March 17, 2017, more than three years after the

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discovery of any alleged mistaken payment. (ECF No. 1-1 at 28.) Thus, the statute of limitations

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bars the first claim of mistaken receipt.

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In the alternative, defendant also argues that the claim of mistaken receipt lacks

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evidentiary support. (ECF No. 41-1 at 15.) To prove a claim for mistaken receipt, a plaintiff

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must show: (1) that he paid defendant money by mistake; (2) that defendant did not have a right

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to that money; (3) that he has asked defendant to return the money; (4) that defendant has not

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returned the money; and (5) the amount of money that defendant owes plaintiff. Utility Audit

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Co., Inc. v. City of Los Angeles, 112 Cal. App. 4th 950, 958 (2003).

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Plaintiff provided no evidence that defendant has received any money that belongs to

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plaintiff and should be returned to him. Moreover, the undisputed facts show that plaintiff’s

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payments to defendant went towards his outstanding balance on his federal loan. Furthermore,

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plaintiff admitted in his opposition that defendant did not accept any money by mistake when

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plaintiff changed his position stating that he “repaid some or all of [his loans].” (ECF No. 45 at

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1.) Accordingly, the claim of mistaken receipt also lacks evidentiary support.

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For these reasons, defendant is entitled to summary judgement on plaintiff’s claim of
mistaken receipt.
Claim 2: Money had and received
Defendant argues that the statute of limitations bars the second claim of money had and
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received and that it additionally lacks evidentiary support. (ECF No. 41-1 at 14.) The statute of

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limitations to bring a claim for money had and received is two years and does not run until the

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discovery of the loss. Cal. Civ. Proc. Code § 339(1); see Dhaliwal v. Singh, 2013 WL 2664336,

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at *7 (E.D. Cal. 2013) (citing Franck v. J.J. Sugarman-Rudolph Co., 40 Cal. 2d 81, 90 (1952)).

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As discussed in greater detail above, the undisputed facts show that between 2002 and

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2004, plaintiff made multiple payments towards his outstanding federal loan, and was made

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aware of his outstanding balance from logging into his online account and from phone

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conversations with representatives of defendant. (See ECF No. 41-3, Exs. 15, 17, 18, 19, 20;

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Iorio Decl. ¶ 28.) Further, plaintiff concedes that he had at least nine phone conversations with

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representatives of defendant and that he logged into his online account at least fifteen times

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between 2003 and 2017. (ECF No. 41-3, Ex. 26; ECF No. 45-3 at 8-9.) This evidence indicates

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that plaintiff would have been aware of any improper payment or money had and received by

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2004, but in any event no later than 2008. Although plaintiff argues that the statute of limitations

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does not bar this claim because of delayed discovery and fraudulent concealment, he provides no

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plausible evidence for either argument to support a tolling of the statute of limitations. (ECF No.

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45 at 5-7.)

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Plaintiff filed the complaint on March 17, 2017, more than two years after the discovery

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of any alleged money had and received. (ECF No. 1-1 at 28.) Therefore, the statute of

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limitations bars the second claim of money had and received.

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In the alternative, defendant argues that the claim for money had and received lacks

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evidentiary support. (ECF No. 41-1 at 15.) “A cause of action is stated for money had and

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received if the defendant is indebted to the plaintiff in a certain sum for money had and received

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by the defendant for the use of the plaintiff.” Gutierrez v. Girardi, 194 Cal. App. 4th 925, 937

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(2011). This claim occurs when a “[defendant] received money which belongs to a [plaintiff],

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and which in equity and good conscience should be paid over to the [plaintiff].” Id. A plaintiff

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who has a financial obligation to a defendant is not entitled to restitution if the money was paid in

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satisfaction of a debt. Durell v. Sharp Healthcare, 183 Cal. App. 4th 1350, 1371 (2010).

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Plaintiff has provided no evidence that defendant received any money which was not
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owed to it. The undisputed facts show that plaintiff’s payments to defendant went towards his

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outstanding balance on his federal loan. Indeed, plaintiff conceded in his opposition that he

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“repaid some or all of [his loans].” (ECF No. 45 at 1.) Therefore, the claim of money had and

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received also lacks evidentiary support.

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For these reasons, defendant is entitled to summary judgment on plaintiff’s claim of
money had and received.
Claim 4: Unjust Enrichment/Restitution
Defendant argues that the statute of limitations bars the fourth claim of “unjust
enrichment/restitution” and it additionally lacks evidentiary support. (ECF No. 41-1 at 16.) The

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statute of limitations for unjust enrichment based on fraud or mistake is three years from its

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discovery. Cal. Civ. Proc. Code § 338(d); See Pedersen v. Greenpoint Mortg. Funding, Inc., 900

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F. Supp. 2d 1071 (E.D. Cal. 2012) (citing Federal Deposit Ins. Corp. v. Dintino, 167 Cal. App.

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4th 333, 347 (2008)).

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As discussed in greater detail above, the undisputed facts show that between 2002 and

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2004, plaintiff made multiple payments towards his outstanding loan, and was made aware of his

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outstanding balance from logging into his online account and from phone conversations with

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representatives of defendant. (See ECF No. 41-3, Exs. 15, 17, 18, 19, 20; Iorio Decl. ¶ 28.)

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Further, plaintiff concedes that he had at least nine phone conversations with representatives of

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defendant and that he logged into his online account at least fifteen times between 2003 and 2017.

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(ECF No. 41-3, Ex. 26; ECF No. 45-3 at 8-9.) This evidence indicates that plaintiff would have

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been aware of any improper payment or unjust enrichment by 2004, but no later than 2008.

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Plaintiff argues that the statute of limitations does not bar this claim because of delayed discovery

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and fraudulent concealment, but he provides no evidence for either argument to support a tolling

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of the statute of limitations. (ECF No. 45 at 5-7.)

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Plaintiff filed the complaint on March 17, 2017, more than three years after the discovery

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of any alleged unjust enrichment. (ECF No. 1-1 at 28.) Therefore, the statute of limitations bars

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the fourth claim of unjust enrichment.

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In the alternative, defendant argues that the claim of unjust enrichment lacks evidentiary
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support. (ECF No. 41-1 at 17.) Under California law, an action for unjust enrichment or

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restitution “does not lie when an enforceable binding agreement exists defining the rights of the

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parties.” Paracor Finance, Inc. v. General Elec. Capital Corp., 96 F.3d 1151, 1167 (9th Cir.

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1996). “Nonetheless, restitution may be awarded in lieu of breach of contract damages when the

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parties had an express contract, but it was procured by fraud or is unenforceable or ineffective for

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some reason.” York v. American Savings Network, Inc., 2017 WL 3475157, at *3 (E.D. Cal.

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2017) (citing McBride v. Boughton, 123 Cal. App. 4th 379, 388 (2004)). “To show that [he] is

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entitled to restitution, a plaintiff must demonstrate that the defendant is in possession of money or

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property taken from [him].” York, 2017 WL 3475157, at *3.

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The undisputed facts show that plaintiff knew his payments made to defendant were

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pursuant to his contractual obligation to repay his entire consolidated loan. (Plaintiff’s Depo

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44:13–46:21.) Defendant was entitled to receive plaintiff’s loan payments subject to a valid

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promissory note. (Id.) Plaintiff has not provided any evidence whatsoever that defendant was

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unjustly enriched by plaintiff’s loan payments. In fact, plaintiff admits in his opposition that he

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repaid some or all of his loans, contradicting his initial position that he overpaid his loans. (ECF

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No. 45 at 1.) Accordingly, the claim of unjust enrichment also lacks evidentiary support.

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For these reasons, defendant is entitled to summary judgment for plaintiff’s claim of
unjust enrichment.
Claim 5: Action for an accounting
Defendant argues that it is entitled to summary judgment on plaintiff’s claim for an

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accounting because it lacks evidentiary support, and defendant has provided plaintiff with an

22

accounting through the discovery process. (ECF No. 41-1 at 17.)

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To bring a claim for accounting, a plaintiff must show: (1) that a relationship exists

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between the parties that requires an accounting; and (2) that a balance is due from the defendant

25

to the plaintiff that can only be ascertained by an accounting. See Teselle v. McLoughlin, 173

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Cal. App. 4th 156, 179 (2009). “A right to an accounting is derivative; it must be based on other

27

claims.” Flores v. EMC Mortg. Co., 997 F. Supp. 2d 1088, 1120 (E.D. Cal. 2014) (citing Janis v.

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California State Lottery Com., 68 Cal. App. 4th 824, 833-44 (1998)). Furthermore, a plaintiff,
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1

“as the party owing money, not the party owed money, has no right to seek an accounting.”

2

Quinteros v. Aurora Loan Services, 740 F. Supp. 2d 1163, 1170 (E.D. Cal. 2010).

3

Defendant asserts it has provided plaintiff with a detailed payment history through

4

discovery which produced a detailed accounting of plaintiff’s loan payments and how they were

5

applied to his respective loans. (ECF No. 41-1 at 18.) Regardless, plaintiff has not established

6

that he is the party owed money by defendant. In fact, plaintiff admitted that he is the party

7

owing money, when he conceded he “repaid some or all of [his loans]” and that “a balance may

8

or may not be owed” to defendant. (ECF No. 45 at 1, 4.) Plaintiff claims “[t]he evidence has

9

established that certain sums were paid” to the defendant and that “[he] is entitled to know how

10

much.” (Id. at 7.) But plaintiff has not provided any evidence at all that shows defendant owes

11

him any sum of money. The undisputed facts show that plaintiff is the party owing money, and

12

thus, has no right to seek an accounting. (ECF No. 41-3, Exs. 15, 29.) Moreover, because

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plaintiff’s accounting claim is derivative and the court concludes that plaintiff’s other claims fail,

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plaintiff’s accounting claim is likewise not viable.

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Accordingly, defendant is entitled to summary judgment on plaintiff’s claim of demand
for an accounting.
Claim 6: Fraud and Conspiracy to Commit Fraud
Defendant argues plaintiff’s claim of fraud is barred by the statute of limitations and that it

19

also lacks evidentiary support. (ECF No. 41-1 at 19.) A cause of action for fraud must be

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brought within three years of the date of the discovery of the fraud. Cal. Civ. Proc. Code

21

§ 338(d); See Dougherty v. Bank of Am., N.A., 177 F. Supp. 3d 1230, 1242 (E.D. Cal. 2016).

22

As discussed in greater detail above, the undisputed facts show that between 2002 and

23

2004, plaintiff made multiple payments towards his outstanding loan, and was made aware of his

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outstanding balance from logging into his online account and from phone conversations with

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representatives of defendant. (See ECF No. 41-3, Exs. 15, 17, 18, 19, 20; Iorio Decl. ¶ 28.)

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Further, plaintiff concedes that he had at least nine phone conversations with representatives of

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defendant and that he logged into his online account at least fifteen times between 2003 and 2017.

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(ECF No. 41-3, Ex. 26; ECF No. 45-3 at 8-9.) This evidence indicates that plaintiff would have
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been aware of any fraud or conspiracy to commit fraud by 2004, but no later than 2008. At no

2

point does plaintiff address defendant’s statute of limitations argument in the opposition.

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Plaintiff filed the complaint on March 17, 2017, more than three years after the discovery

4

of any alleged fraud. (ECF No. 1-1 at 28.) Therefore, the statute of limitations bars the sixth

5

claim of fraud and conspiracy to commit fraud.

6

In the alternative, defendant argues that the fraud claims lack evidentiary support. (ECF

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No. 41-1 at 20.) To establish a claim of fraud, a plaintiff must present evidence to satisfy each of

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the following elements: “(a) misrepresentation (false representation, concealment, or

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nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce

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reliance; (d) justifiable reliance; and (e) resulting damage.” Lazar v. Superior Court, 12 Cal. 4th

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631, 638 (1996). Defendant argues that plaintiff cannot provide any evidence to establish a single

12

element of fraud. (ECF No. 41-1 at 20.) In response to this, plaintiff asserts that he can present

13

evidence at trial of defendant “mismanaging its accounts.” (ECF No. 45 at 8.) He also claims

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fraud has been established because defendant is currently defending other lawsuits from several

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other plaintiffs for fraud and other causes of action. (Id.) However, to survive a summary

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judgment claim, plaintiff, as the opposing party, has the burden to show there is a genuine dispute

17

of a material fact by providing evidence or pointing to evidence in the record. Plaintiff has

18

provided no evidence at all that defendant has satisfied a single element of a fraud claim.

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Accordingly, plaintiff’s claim of fraud lacks evidentiary support.

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For these reasons, defendant is entitled to summary judgment on plaintiff’s claim of fraud.
Claim 7: Negligence

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Defendant argues that plaintiff’s negligence claim is barred by the statute of limitations

23

and that it further lacks evidentiary support. The statute of limitations for a negligence claim is

24

two years. Cal. Civ. Proc. Code § 339; See Hydro-Mill Co. v. Hayward, Tilton & Rolapp Ins.

25

Assocs., Inc., 115 Cal. App. 4th 1145, 1154-55 (2004).

26

As discussed in greater detail above, the undisputed facts show that between 2002 and

27

2004, plaintiff made multiple payments towards his outstanding loan, and was made aware of his

28

outstanding balance from logging into his online account and from phone conversations with
14

1

representatives of defendant. (See ECF No. 41-3, Exs. 15, 17, 18, 19, 20; Iorio Decl. ¶ 28.)

2

Further, plaintiff concedes that he had at least nine phone conversations with representatives of

3

defendant and that he logged into his online account at least fifteen times between 2003 and 2017.

4

(ECF No. 41-3, Ex. 26; ECF No. 45-3 at 8-9.) This evidence indicates that plaintiff would have

5

been aware of any negligence by 2004, but no later than 2008.

6

Plaintiff’s sole response to defendant’s statute of limitations argument is that defendant’s

7

alleged negligence is ongoing because defendant “continues to mismanage its accounts,” and

8

“[p]ursuant to the Continuing Wrongs Doctrine, the statute of limitations is equitably tolled.”

9

(ECF No. 45 at 8-9.) But plaintiff has not provided any evidence of continuing mismanagement

10
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other than his own conclusory allegations.
Plaintiff filed the complaint on March 17, 2017, more than two years after the discovery

12

of any alleged negligence. (ECF No. 1-1 at 28.) Therefore, the statute of limitations bars the

13

seventh claim of negligence.

14

In the alternative, defendant argues that plaintiff’s negligence claim lacks evidentiary

15

support. To establish a claim of negligence, a plaintiff must prove: (1) existence of a legal duty

16

of care; (2) breach of that duty; (3) causation; and (4) damages. McIntyre v. Colonies-Pacific,

17

LLC, 228 Cal. App. 4th 664, 671 (2014). However, “[a] loan servicer does not owe a fiduciary

18

duty to a borrower beyond the duties set forth in the loan contract.” Castaneda v. Saxon Mortg.

19

Servs., Inc., 687 F. Supp. 2d 1191, 1198 (E.D. Cal. 2009). Also, “a debt collector owes no duty

20

of care to debtors in the collection of consumer debts.” Brandt v. Ocwen Loan Servicing, LLC,

21

2017 WL 5878581, at *9 (E.D. Cal. 2017). It is undisputed that defendant here acted in its

22

capacity as the servicer of plaintiff’s loan. (ECF No. 1-1 at 15.) As such, defendant’s conduct

23

did not give rise to any legal duty to support a negligence claim.

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Moreover, even if defendant had a duty of care, plaintiff has not provided any evidence

25

that defendant breached a duty owed to plaintiff or that any negligent conduct caused him to

26

suffer any damages. There is no evidence that defendant failed to “maintain good accounting

27

practices,” or that it obtained overpayment of plaintiff’s loans. (Compl. ¶ 57.) Plaintiff cannot

28

recover on a damages claim because he was contractually obligated to make loan payments
15

1

pursuant to valid promissory notes. (Plaintiff’s Depo. 44:13–46:13.) See Auerbach v. Great W.

2

Bank, 74 Cal. App. 4th 1172, 1185 (1995). Because plaintiff has provided no evidence to

3

establish a single element of a negligence claim, the claim of negligence lacks evidentiary

4

support.

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6

Therefore, defendant is entitled to summary judgment on plaintiff’s negligence claim.
Claim 8: California Fair Debt Collections Practices Act

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Defendant argues that plaintiff’s eighth claim for violation of the California Fair Debt

8

Collections Practices Act (“CFDCPA”) lacks evidentiary support. Plaintiff claims defendant

9

violated the CFDCPA by “continuing to collect on debt that has long since been satisfied.”

10

(Compl. ¶ 63.) See Cal. Civ. Code §§ 1788, et seq. However, the undisputed facts show that

11

plaintiff’s debt was never satisfied and that plaintiff still owes outstanding federal loans to

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defendant. (ECF No. 41-1 at 23; ECF No. 41-3, Exs. 18, 20, 22-26.) Plaintiff has failed to

13

provide any evidence that his debt was satisfied, and merely asserts that “there is a genuine issue

14

of triable fact on those matters.” (ECF No. 45 at 10.) Such conclusory assertions are insufficient

15

to defeat summary judgment.

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Accordingly, defendant is entitled to summary judgment on plaintiff’s claim for violation
of the CFDCPA.
Claim 9: California Consumer Credit Reporting Act
Defendant argues that plaintiff’s ninth claim for violation of the California Consumer

20

Credit Reporting Act (“CCRA”) lacks evidentiary support. Plaintiff argues defendant violated the

21

CCRA by “reporting inaccurate information about plaintiff to one or more consumer reporting

22

agencies,” by failing to “provide evidence of the alleged debt” to plaintiff or to the consumer

23

reporting agencies, and by failing to notify plaintiff of “any determination that Plaintiff’s dispute

24

is frivolous.” (Compl. ¶¶ 67-69.)

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The CCRA provides that “[a] person shall not furnish information on a specific

26

transaction or experience to any consumer credit reporting agency if the person knows or should

27

know the information is incomplete or inaccurate.” Cal. Civ. Code § 1785.25. To determine if

28

information is incomplete or inaccurate within the meaning of the CCRA, courts are guided by
16

1

the “patently incorrect or materially misleading” standard set forth in Gorman v. Wolpoff &

2

Abramson, LLP, 584 F.3d 1147, 1163 (9th Cir. 2009). See Carvalho v. Equifax Information

3

Services, LLC, 629 F.3d 876, 890-91 (9th Cir. 2010) (holding that reported information is

4

incomplete or inaccurate if it is “patently incorrect, or [if] it is misleading in such a way and to

5

such an extent that it can be expected to adversely affect credit decisions”) (citing Gorman, 584

6

F.3d at 1163).

7

Here, plaintiff has not provided any evidence that defendant’s reporting was patently

8

incorrect or misleading in any way where it adversely affected credit decisions. Nor has plaintiff

9

provided any evidence contradicting the undisputed fact that he still has an outstanding debt for

10

his consolidated federal loan. (ECF No. 41-3, Ex. 29.) The only argument plaintiff makes for

11

why this claim should survive summary judgment is that “there is a genuine issue of triable fact

12

on those matters.” (ECF No. 45 at 10.) Again, such a conclusory assertion cannot defeat

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summary judgment.

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Accordingly, defendant is entitled to summary judgment on plaintiff’s claim for violation
of the CCRA.
Claims 10 & 11: Unlawful and Fraudulent Business Practices

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Defendant argues that plaintiff’s tenth and eleventh claims of fraudulent and unlawful

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business practices are barred by the statute of limitations and further lack evidentiary support.

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Plaintiff contends defendant engaged in fraudulent and unlawful business practices in violation of

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California’s unfair competition law (“UCL”), California Business & Professions Code §§ 17200,

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et seq. The statute of limitations for UCL claims is four years. Cal. Bus. & Prof. Code § 17208;

22

Arzamendi v. Wells Fargo Bank, N.A., 2018 WL 1210978, at *8 (E.D. Cal. 2018).

23

As discussed in greater detail above, the undisputed facts show that between 2002 and

24

2004, plaintiff made multiple payments towards his outstanding loan, and was made aware of his

25

outstanding balance from logging into his online account and from phone conversations with

26

representatives of defendant. (See ECF No. 41-3, Exs. 15, 17, 18, 19, 20; Iorio Decl. ¶ 28.)

27

Further, plaintiff concedes that he had at least nine phone conversations with representatives of

28

defendant and that he logged into his online account at least fifteen times between 2003 and 2017.
17

1

(ECF No. 41-3, Ex. 26; ECF No. 45-3 at 8-9.) This evidence thus indicates that plaintiff would

2

have been aware of any unlawful or fraudulent business practices by 2004, but no later than 2008.

3

At no point in plaintiff’s opposition does he substantively respond to defendant’s argument that

4

these claims are time barred.

5

Plaintiff filed the complaint on March 17, 2017, more than four years after the discovery

6

of any alleged UCL violations. (ECF No. 1-1 at 28.) Accordingly, the court finds the statute of

7

limitations bars plaintiff’s UCL claims.

8

In the alternative, defendant argues claims ten and eleven lack evidentiary support. To

9

prove a claim under the UCL, a plaintiff must show “that the defendant committed a business act

10

that is either fraudulent, unlawful, or unfair.” Levine v. Blue Shield of California, 189 Cal. App.

11

4th 1117, 1136 (2010). “A defendant cannot be liable under § 17200 for committing ‘unlawful

12

business practices’ without having violated another law.” Ingels v. Westwood One Broad. Servs.,

13

Inc., 129 Cal. App. 4th 1050, 1060 (2005). Accordingly, a UCL claim based on such an

14

allegation must rest on a violation of some independent substantive statute, regulation or case

15

law. See Farmers Ins. Exch. v. Superior Court, 2 Cal. 4th 377, 383 (1992) (action under section

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17200 borrows violations of other laws). Business conduct is “unfair” under the UCL, when it

17

“offends an established public policy or ... is immoral, unethical, oppressive, unscrupulous or

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substantially injurious to consumers.” People v. Casa Blanca Convalescent Homes, Inc., 159 Cal.

19

App. 3d 509, 530 (1984). A business act is “fraudulent” within the meaning of the UCL if it is

20

“likely to deceive the public.” McKell v. Washington Mutual, Inc., 142 Cal. App. 4th 1457, 1471

21

(2006). In asserting a claim under the UCL’s “fraudulent” prong in federal court, a plaintiff must

22

plead facts that meet the particularity requirements of Federal Rule of Civil Procedure 9(b). See

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Kearns v. Ford Motor Co., 567 F.3d 1120, 1127 (9th Cir. 2009).

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Here, plaintiff has provided no evidence that defendant’s conduct is in violation of any

25

law or that it is likely to deceive the public. The only argument plaintiff makes for why these

26

claims should survive summary judgment is the conclusory assertion that “there is a genuine issue

27

of triable fact on those matters.” (ECF No. 45 at 10.) For these reasons, plaintiff’s UCL claims

28

lack evidentiary support.
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2

Accordingly, defendant is entitled to summary judgment on plaintiff’s UCL claims.
Claim 3: Action for Declaratory Judgment and Injunctive Relief

3

In light of the court’s conclusion that summary judgment is appropriate with respect to

4

plaintiff’s other claims, plaintiff’s claims for declaratory relief and injunctive relief, which are

5

derivative of the other claims, likewise fail. See, e.g., Gayduchik v. Countrywide Home Loans,

6

Inc., 2010 WL 1737109, at *4 (E.D. Cal. 2010) (“[D]eclaratory relief does not serve to furnish a

7

litigant with a second cause of action for the determination of identical issues…Injunctive relief is

8

a remedy which must rely upon underlying claims.”).

9

Plaintiff’s Request for Leave to Amend the Complaint

10

Lastly, plaintiff argues that he should be granted leave to amend if this court determines

11

that all of his present claims cannot survive. (ECF No. 45 at 10.) Although the court, especially

12

in the case of pro se litigants, generally liberally grants leave to amend in the earlier pleadings

13

stage of the action, see Fed. R. Civ. P. 15(a)(2), a pending motion for summary judgment “weighs

14

heavily” against allowing leave to amend. Schlacter-Jones v. Gen. Tel. of California, 936 F.2d

15

435, 443 (9th Cir. 1991) (overruled in part on other grounds in Cramer v. Consol. Freightways,

16

Inc., 255 F.3d 683, 692 (9th Cir. 2001)). “A motion for leave to amend is not a vehicle to

17

circumvent summary judgment.” Id.

18

Here, the parties had previously stipulated to allow plaintiff to file an amended complaint

19

by November 20, 2017. (ECF No. 25.) However, no amended complaint was filed by that

20

deadline. On April 19, 2018, plaintiff again sought leave to amend the complaint. (ECF No. 35.)

21

However, on May 15, 2018, the court denied that motion, finding that plaintiff had not shown

22

good cause to modify the scheduling order and amend his complaint, because plaintiff had not

23

been diligent in seeking amendment, and the resulting prejudice to defendant and impact on the

24

court’s schedule militated against modification of the scheduling order. (ECF No. 40.) Nothing

25

has changed since that time. In his opposition to summary judgment, plaintiff merely asserts that

26

“[i]f plaintiff’s present causes of action cannot survive, something must.” (ECF No. 45 at 10.)

27

Plaintiff has not shown good cause why leave to amend should be granted at this late juncture.

28

Thus, plaintiff’s request for leave to amend should be denied.
19

1

CONCLUSION

2

Accordingly, IT IS HEREBY RECOMMENDED that:

3

1. Defendant’s motion for summary judgment (ECF No. 41) be GRANTED IN FULL.

4

2. Plaintiff’s request for further leave to amend the complaint be DENIED.

5

3. Judgment be entered for defendant.

6

4. The Clerk of Court be directed to close this case.

7

These findings and recommendations are submitted to the United States District Judge

8

assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(l). Within fourteen (14)

9

days after being served with these findings and recommendations, any party may file written

10

objections with the court and serve a copy on all parties. Such a document should be captioned

11

“Objections to Magistrate Judge’s Findings and Recommendations.” Any reply to the objections

12

shall be served on all parties and filed with the court within fourteen (14) days after service of the

13

objections. The parties are advised that failure to file objections within the specified time may

14

waive the right to appeal the District Court’s order. Turner v. Duncan, 158 F.3d 449, 455 (9th

15

Cir. 1998); Martinez v. Ylst, 951 F.2d 1153, 1156-57 (9th Cir. 1991).

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17

IT IS SO RECOMMENDED.
Dated: November 7, 2018

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