Dion v. Fulton, Friedman & Gullace, LLP et al

Filing 22

ORDER granting 13 Motion to Strike 13 MOTION to Strike 6 Answer to Complaint Affirmative Defenses (sclc2, COURT STAFF) (Filed on 1/17/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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JOHN HENRY DION,

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Plaintiff,

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v.

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FULTON FRIEDMAN & GULLACE LLP, a
New York limited liability
partnership; and ANN KATHERYN
MERRILL, individually and in her
official capacity,

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Defendants.

United States District Court

For the Northern District of California

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) Case No. 11-2727 SC
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) ORDER GRANTING PLAINTIFF'S
) MOTION TO STRIKE
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This matter comes before the Court on the Motion to Strike

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Defendants' Affirmative Defenses brought by Plaintiff John Henry

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Dion ("Plaintiff") against Defendants Fulton Friedman & Gullace LLP

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and Ann Katheryn Merrill (collectively, "Defendants").

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("MTS").

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("Opp'n"), 15 ("Reply").

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Court finds the Motion suitable for determination without oral

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argument.

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Plaintiff's Motion and STRIKES Defendants' affirmative defenses

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WITHOUT PREJUDICE.

The Motion has been fully briefed.

ECF No. 13

ECF Nos. 14

Pursuant to Civil Local Rule 7-1(b), the

For the reasons set forth below, the Court GRANTS

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I.

BACKGROUND
On June 6, 2011, Plaintiff brought an action against

Defendants for alleged violations of the federal Fair Debt

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Collection Practices Act, 15 U.S.C. §§ 1692, et seq. ("FDCPA") and

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California's Rosenthal Fair Debt Collection Practices Act, Cal.

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Civ. Code §§ 1788 et seq. ("RFDCPA").

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Plaintiff seeks actual damages, statutory damages, and attorney

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fees and costs.

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disabled person, pursuant to Cal. Civ. Code § 3345.

Id.

ECF No. 1 ("Compl.") ¶ 1.

Plaintiff also seeks treble damages as a
Compl. at 12.

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Plaintiff alleges that Defendants, a licensed California

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attorney and the New York-based law firm that employs her, Compl.

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¶¶ 9-10, unlawfully attempted to collect a debt from him by filing
See Compl. ¶ 15.

Plaintiff denies that

United States District Court

For the Northern District of California

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a lawsuit in state court.

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he ever owed any debt and alleges that Defendants made various

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misrepresentations in the course of prosecuting the state court

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lawsuit.

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Plaintiff's claims under the FDCPA and RFDCPA, both of which

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prohibit, among other things, deceptive debt collection practices.

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See FDCPA § 1692e, RFDCPA § 1788.13.

Compl. ¶¶ 12, 15-31.

These allegations form the basis of

Defendants filed an Answer in which they asserted fifteen

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affirmative defenses.

ECF No. 6 ("Answer") at 6-9.

Plaintiff then

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filed the instant motion to strike all fifteen affirmative defenses

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pursuant to Federal Rule of Civil Procedure 12(f).

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("MTS").

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Defendants be given leave to amend.

ECF No. 13

In the MTS, Plaintiff specifically requests that
MTS at 18.

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II.

DISCUSSION
Before addressing Defendants' affirmative defenses, the Court

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considers a preliminary issue raised by the parties: the proper

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standard governing Rule 12(f) motions to strike affirmative

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defenses.1

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A. Applicable Standard for Rule 12(f) Motions to Strike

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Affirmative Defenses
The parties dispute which standard should apply to the instant

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motion.

Plaintiffs urge this Court to apply the heightened

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"plausibility" pleading standard that some district courts have

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derived from the Supreme Court's watershed Twombly and Iqbal

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decisions.

MTS at 2-4, Reply at 1-3; see also Bell Atlantic Corp.

United States District Court

For the Northern District of California

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v. Twombly, 550 U.S. 544 (2007), Ashcroft v. Iqbal, 556 U.S. 662

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(2009).

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"fair notice" standard articulated by the Ninth Circuit in Wyshak,

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decades before the Supreme Court decided Twombly and Iqbal.

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at 2-6; see also Wyshak v. City Nat'l Bank, 607 F.2d 824, 827 (9th

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Cir. 1979).

Defendants argue for the continued vitality of the lower

Opp'n

This disagreement mirrors the difference of opinion among

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federal district courts that has followed in the wake of the

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Twombly/Iqbal sea change in federal pleading standards.

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Patel summarized the situation in Barnes v. AT&T Pension Benefit

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Plan-Nonbargained Program, 718 F. Supp. 2d 1167, 1171-72 (N.D. Cal.

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Judge

The parties also raise the preliminary issue of whether the FDCPA
limits the affirmative defenses a defendant may raise. Plaintiff
argues that by enumerating three affirmative defenses in the FDCPA,
Congress barred any others and that therefore all of Defendants'
affirmative defenses must be struck, except those provided by the
FDCPA. MTS at 6-7; Reply at 4-5. Under Plaintiff's reading of the
FDCPA, only two of Defendants' fifteen affirmative defenses are
even theoretically permissible. See MTS at 7-10. As Defendants
point out, however, Plaintiff has pled an RFDCPA claim in addition
to the FDCPA claim. Opp'n at 7 n.6. Plaintiff does not argue that
the RFDCPA limits defenses. See generally Reply. By the terms of
Plaintiff's own argument, then, the FDCPA alone could not compel
this Court to strike affirmative defenses that apply just as well
to RFDCPA claims. Therefore the Court need not, and does not, reach
Plaintiff's argument concerning the FDCPA's limitation on defenses.
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2010).

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Practice and Procedure § 1278 (3d ed. 1998 & Supp. 2011)

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(describing split).

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Opp'n at 4, neither the Supreme Court nor the Ninth Circuit has yet

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held whether the reasoning of Twombly and Iqbal, which specifically

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addressed Rule 8's pleading standard for complaints, extends to

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affirmative defenses pled in an answer.

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at 1171.

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while a minority continue to apply the fair notice standard of

United States District Court

For the Northern District of California

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Wyshak.2

See also 5 Charles Alan Wright & Arthur R. Miller, Federal

As both parties acknowledge, MTS at 4 n.12,

Barnes, 718 F. Supp. 2d.

A majority of district courts have held that it does,

Id.

This Court is not bound by the decisions of other district

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courts, but it finds Judge Patel's reasoning in support of the

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heightened "plausibility" standard to be persuasive.

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deciding the present motion, the Court applies the heightened

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standard derived from Twombly and Iqbal and explicated in Barnes.

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This standard "serve[s] to weed out the boilerplate listing of

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affirmative defenses which is commonplace in most defendants'

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pleadings where many of the defenses alleged are irrelevant to the

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claims asserted."

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it furthers the underlying purpose of Rule 12(f), which is to avoid

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spending time and money litigating spurious issues.

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Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), rev'd on

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other grounds, 510 U.S. 517 (1994).

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complaint must allege enough supporting facts to nudge a legal

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Barnes, 718 F. Supp. 2d at 1172.

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Therefore, in

In doing so,

See Fantasy,

Just as a plaintiff's

The Court notes that a Ninth Circuit panel cited Wyshak's fair
notice standard as recently as 2010, a year after Iqbal. Simmons
v. Navajo Cty., 609 F.3d 1011, 1023 (9th Cir. 2010). However, that
panel did not have the issue of Rule 8 pleading standards squarely
before it, and its citation appeared in a discussion focused on
when, not how, to plead an affirmative defense. See Simmons, 609
F.3d at 1022-23.
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claim across the line separating plausibility from mere

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possibility, Twombly, 550 U.S. at 570, a defendant's pleading of

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affirmative defenses must put a plaintiff on notice of the

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underlying factual bases of the defense, Barnes, 718 F. Supp. at

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1172-73.

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550 U.S. at 555.

Mere labels and conclusions do not suffice.

See Twombly,

If a district court applying the proper standard determines

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that a pleading is deficient, the court may strike the pleading and

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require the non-moving party to submit an amended pleading that

United States District Court

For the Northern District of California

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includes more specific allegations.

Williams v. California 1st

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Bank, 859 F.2d 664, 665 (9th Cir. 1988).

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stricken, the district court should freely give leave to amend so

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long as no prejudice to the opposing party results.3

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F.2d at 826.

When a defense is

Wyshak, 607

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B. Application of Standard to Defendants' Affirmative Defenses

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Plaintiff challenges each of Defendants' fifteen affirmative

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defenses on the ground that they do not provide Plaintiff with

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adequate notice of the facts underlying the defense.

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MTS.

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Federal Rules, a defendant need only 'state' his defenses," without

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more.

Defendants respond that "under the plain language of the

Opp'n at 4 (quotation marks in original).
The Court agrees with Plaintiff.

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See generally

Defendants fail in each of

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their fifteen defenses to "point to the existence of some

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identifiable fact that if applicable to [Plaintiff] would make the

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The Barnes court noted that prejudice may arise solely from a
plaintiff's being required to engage in discovery on frivolous
issues, which suggests that any insufficiently pled affirmative
defense may be struck with prejudice. Barnes, 718 F. Supp. at
1173. In this case, Plaintiff specifically asks that Defendants be
given leave to amend. MTS at 18. The Court therefore will not
impute prejudice to Plaintiff at this time.
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affirmative defense plausible on its face."

Barnes, 718 F. Supp.

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2d at 1172.

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more than that various affirmative defenses exist.

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second affirmative defense, "Statute of Limitations/Laches,"

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provides a representative example.

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entirety: "The purported claims set forth in the Complaint are

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barred in whole or in part by the applicable statutes of limitation

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and/or the equitable doctrine of laches."

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language constitutes nothing more than "labels and conclusions."

Throughout their Answer, Defendants allege nothing
Defendants'

That defense reads in its

Answer at 6.

This

United States District Court

For the Northern District of California

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Cf. Twombly, 550 U.S. at 555.

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failure to plead any facts, this paragraph neglects even to

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identify a specific defense, offering Plaintiff a choice between

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statute of limitations "and/or" laches.

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any standard, Defendants must give Plaintiff fair notice of which

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defense Defendants assert rather than leaving it to Plaintiff, and

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this Court, to guess.

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The Court notes that, aside from its

This will not do.

Under

The Court also observes that a number of Defendants' putative

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affirmative defenses are in fact negative defenses or otherwise not

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affirmative defenses.

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the extent that Defendants have improperly labeled negative and

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other defenses as affirmative defenses, this provides another

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reason for the Court to strike those putative affirmative defenses.

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See Barnes, 718 F. Supp. 2d at 1173-75.

To

Defendants argue that the heightened plausibility standard is

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unfair because they "stand[] in a much different position than a

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plaintiff who has a year or more to investigate and prepare the

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claims in the complaint."

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that the Federal Rules allow only 21 days to file an answer.

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Fed. R. Civ. P. 12(a)(1)(A).

Opp'n at 5.

Defendants correctly note
Id.;

But Defendants fail to realize that

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Twombly and Iqbal do not require them to establish conclusively in

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their initial pleading that their affirmative defenses must carry

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the day.

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facts to establish the bare plausibility of their labels and

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conclusions.

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Those cases require only that Defendants plead enough

Even if that were not the case, Defendants' concern about Rule

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12's 21-day time limit is misplaced.

While it is true that the

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Federal Rules allow only 21 days to file an answer, this Circuit

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has liberalized the requirement that affirmative defenses be raised

United States District Court

For the Northern District of California

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in a defendant's initial pleading and allows affirmative defenses

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to be asserted in a later motion absent prejudice to the non-moving

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party.

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Defendants to amend their Answer at any time with the Court's

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leave.

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(permitting amendment during trial), Fed. R. Civ. P. 15(c)(1)(B)

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(permitting relation back of amended pleading containing a defense

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arising from same conduct "set out -- or attempted to be set out --

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in the original pleading").

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unfair "use-it-or-lose-it" situation with respect to affirmative

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defenses.

Simmons, 609 F.3d at 1023.

Moreover, Rule 15 permits

Fed. R. Civ. P. 15(a)(2); see also Fed. R. Civ. P. 15(b)(1)

Defendants have not been put in an

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III. CONCLUSION

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For the foregoing reasons, the Court GRANTS the Motion to

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Strike filed by Plaintiff John Henry Dion against Defendants Fulton

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Friedman & Gullace LLP and Ann Katheryn Merrill.

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WITHOUT PREJUDICE the Answer's affirmative defenses.

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gives Defendants LEAVE TO AMEND the Answer within thirty (30) days

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of this Order.

The Court STRIKES
The Court

If Defendants do not file an amended Answer within

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that time, the Court shall deem all fifteen affirmative defenses

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STRICKEN WITH PREJUDICE.

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their amended pleading shall be consistent with the guidance

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provided by this Order.

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If Defendants file an amended Answer,

The parties shall appear for a Case Management Conference on
April 6, 2012, at 10:00 a.m. in Courtroom 1.

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IT IS SO ORDERED.

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United States District Court

For the Northern District of California

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Dated: January 17, 2012
UNITED STATES DISTRICT JUDGE

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