American Express,et al .v Linda Ann Wright

Filing 42

ORDER GRANTING IN PART PLAINTIFF'S MOTION TO DISMISS COUNTERCLAIM by Judge William Alsup [granting in part and denying in part 14 Motion to Dismiss]. (whasec, COURT STAFF) (Filed on 12/1/2011) (Additional attachment(s) added on 12/1/2011: # 1 Certificate of Service) (dt, COURT STAFF).

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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For the Northern District of California

United States District Court

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AMERICAN EXPRESS BANK, FSB, and
FEDERAL SAVINGS BANK,
No. C 11-04492 WHA
Plaintiffs,

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v.

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LINDA WRIGHT aka LINDA A.
WRIGHT, an Individual; DOES 1 through
100, inclusive,

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Defendants.

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ORDER GRANTING IN PART
PLAINTIFF’S MOTION TO
DISMISS COUNTERCLAIM
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AND RELATED COUNTERCLAIMS.
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INTRODUCTION
In this civil action for money due on a contract, plaintiff moves to dismiss a
counterclaim. For the following reasons, the motion is GRANTED IN PART.
STATEMENT
Plaintiffs American Express Bank, FSB and Federal Savings Bank initiated the present

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action against defendant Linda Wright for money due on a contractual agreement.

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Plaintiffs alleged that Wright owed $8,212.12 in unpaid charges to her credit card (Dkt. No. 1).

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Wright removed to federal court and filed a counterclaim against plaintiff AMEX (Dkt. No. 8).

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Wright alleges seven counterclaims: (1) violation of the First Amendment; (2) violation of the

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Due Process and Equal Protection clauses of the Fourteenth Amendment; (3) violation of the

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Fourth Amendment; (4) breach of contract and unjust enrichment; (5) negligence and intentional

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infliction of emotional distress; (6) fraud; and (7) slander and libel. AMEX now moves to

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dismiss the counterclaims for failure to state a claim. This order follows full briefing. A hearing

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was held on December 1, 2011. Wright did not appear at the hearing.

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ANALYSIS

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To survive a motion to dismiss, a complaint must contain sufficient factual matter,

U.S. 662, 129 S. Ct. 1937, 1949 (2009). A claim is facially plausible when there are sufficient

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factual allegations to draw a reasonable inference that a defendant is liable for the misconduct

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For the Northern District of California

accepted as true, to state a claim for relief that is plausible on its face. Ashcroft v. Iqbal, 556

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United States District Court

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alleged. While a court “must take all of the factual allegations in the complaint as true,” it is

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“not bound to accept as true a legal conclusion couched as a factual allegation.” Id. at 1949–50

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(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). “[C]onclusory allegations of

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law and unwarranted inferences are insufficient to defeat a motion to dismiss for failure to state a

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claim.” Epstein v. Wash. Energy Co., 83 F.3d 1136, 1140 (9th Cir. 1996) (citation omitted).

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FRCP 9(b) requires that in all averments of fraud, the circumstances constituting fraud

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must be stated with particularity. Malice, intent, knowledge, and other conditions of a person’s

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mind may be alleged generally. “Averments of fraud must be accompanied by ‘the who, what,

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when, where, and how’ of the misconduct charged.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d

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1097, 1106 (9th Cir. 2003). FRCP 9(b) serves to give defendants notice of the specific

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fraudulent conduct against which they must defend. See Bly-Magee v. California, 236 F.3d

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1014, 1018 (9th Cir. 2001).
STANDING, SUBSTITUTION OF COUNSEL, AND ADDITIONAL PARTIES.

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1.

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Several themes recur in Wright’s briefing that should be addressed up front.

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First, Wright argues that “Federal Savings Bank, and American Express Bank have no standing

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in these proceedings,” and that “American Express Corporation is the correct plaintiff/third party

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defendant” (Opp. 2).*
When Wright removed the present action from state to federal court, she also brought a

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counterclaim that has already been recognized by this Court to be only against American Express

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(Dkt. No. 8). In the captions of its briefing, AMEX identifies itself as “erroneously sued as

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American Express Corporation.” A previous order denied Wright’s motion to add additional

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defendants to her counterclaim because the appended counter complaint was directed to the

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Superior Court of California, County of Humboldt, and because her submission was

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unintelligible (Dkt. No. 32). If Wright intends to bring a counterclaim against a party other
than American Express, she must do so in a way that clearly state the parties to be added.

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For the Northern District of California

United States District Court

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Wright’s standing argument does not defeat the present motion to dismiss her counterclaim.

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Second, Wright appears to challenge the substitution of AMEX’s counsel, although

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Wright’s briefing is largely unintelligible and it is difficult to decipher precisely where her

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objection lies. AMEX properly requested substitution of its counsel (Dkt. No. 15). This Court

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granted the substitution (Dkt. No. 17). Wright is currently appealing this decision to the court

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of appeals (Dkt. No. 28). Wright cannot now defend her counterclaim by arguing that the

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substitution of AMEX’s counsel was improper. Further, in her briefs, Wright frequently refers

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to an action in the Superior Court of California, County of Humboldt. Wright is now advised

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that her state action has no bearing on the present action.
Third, the captions of Wright’s briefs — and most other areas of her briefing —

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contain references to individuals and organizations who are not parties to the present action.

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For example, the caption of her opposition includes Petra Kuhfahl, the United States of America,

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the State of California, and the County of Humboldt as parties. Large portions of Wright’s

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complaint and opposition discuss the Veterans Administration and other individuals and events.

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A diligent reading of Wright’s briefing uncovers no connection between these organizations and

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individuals and the present action. Wright is now advised that American Express is the only

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Portions of Wright’s opposition were written in all capital letters. The capitalization used in such
quotations has been altered in part.

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counter defendant currently named in her counterclaim, and that cannot be altered by adding

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additional parties to the captions of her briefing. If Wright wants to add parties, she must do so

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properly.

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2.

CONSTITUTIONAL CLAIMS.

Wright’s first three claims are for violations of the First, Fourth, and Fourteenth

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Amendments. Wright fails to plead any facts that state a plausible claim for constitutional

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violations.

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First, Wright argues that AMEX violated her First Amendment rights “by taking [her]

this claim relates to alleged actions by the VA. In her opposition, the only additional support

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For the Northern District of California

money and covering it up” (Counter Compl. 10). The remainder of her argument in support of

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United States District Court

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Wright offers to her First Amendment claim is that AMEX “rewr[ote] [her] history, while

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silencing [her] voice through keeping [her] money tied up, while not putting [her] true

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information into [its] files” (Opp. 9). These vague statements fail to demonstrate any facts

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that could establish a violation of her First Amendment rights to free speech, nor any other

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theory that establishes such a violation.

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Second, Wright claims that her Fourth Amendment rights were violated. The totality

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of Wright’s argument in her complaint pertains to the VA and physicians who are not parties

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to the present action. In her opposition, Wright claims that her “phone lines, computer, and

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information that [she] tried to submit to P.A.C.E.R. have been intercepted, and interfered with”

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(Opp. at 10). The Fourth Amendment, however, “cannot be translated into a general

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constitutional ‘right to privacy.’ That Amendment protects individual privacy against certain

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kinds of governmental intrusion.” Katz v. United States, 389 U.S. 347, 350 (1967). The United

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States has not properly been added as a party to this action, and Wright does not allege that

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AMEX is in any way affiliated with the government. Accordingly, Wright has failed to state a

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claim for violation of the Fourth Amendment.

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Third, Wright alleges violations of the Due Process and Equal Protection clauses of the

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Fourteenth Amendment. The entirety of Wright’s argument in her complaint pertains to the VA

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and physicians not involved in the present action. In her opposition, Wright argues that
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AMEX’s counsel “fraudulently fil[ed] motions on behalf of American Express; in court actions

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federal and state courts [sic], which violates Due Process under the 14th Amendment” (Opp. 4).

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Wright offers no authority to support the proposition that AMEX’s counsel violated the

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Fourteenth Amendment by bringing a suit on behalf of their client for unpaid credit card charges.

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All of Wright’s constitutional claims fail to state a claim upon which relief can be

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granted. Accordingly, AMEX’s motion to dismiss these claims is GRANTED.

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3.

CONTRACTUAL CLAIMS.

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Wright labels her fourth claim for relief as breach of contract and “unjust enrichment,

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libel, [and] slander” (Counter Compl. 12). Wright states four claims in one. Her sixth claim
is also for slander and libel, so those claims are addressed in below. See supra Part 4.C.

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For the Northern District of California

United States District Court

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Further, unjust enrichment, also known as restitution, is not a theory of recovery but is instead a

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result thereof. Jogani v. Superior Court, 165 Cal. App. 4th 901, 911 (2008). Accordingly, only

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the breach-of-contract claim will be analyzed in this section.

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Under California law, a claim for breach of contract requires: “(1) existence of the

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contract; (2) plaintiff’s performance or excuse of nonperformance; (3) defendant’s breach;

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and (4) damages to plaintiff as a result of the breach.” CDF Firefighters v. Maldonado, 158 Cal.

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App. 4th 1226, 1239 (2008). Wright alleges that AMEX accepted over $4,500 from her without

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crediting her payments, and wrongly charged her fees and raised her interest rate (Counter

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Compl. 2, 10). Wright appended to her opposition copies of personal checks and credit card

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bills, and argues that she has further documentation of AMEX’s alleged breach of contract.

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AMEX argues that “Wright does not allege which provisions of the cardmember

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agreement were violated, but only alleges that the agreement was violated” (Br. 8). AMEX does

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not dispute that a contract existed. Wright alleges that she performed the contract by making

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payments, that AMEX breached by failing to credit her payments and charging her fees, and that

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she consequently suffered damages. Wright thus has pled sufficient facts to draw a reasonable

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inference that AMEX breached the agreement. Accordingly, AMEX’s motion to dismiss the

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breach-of-contract claim is DENIED.

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4.

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Wright alleges several tort claims. Much like before, this section of the counterclaim

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TORT CLAIMS.

clumps together more than one claim for relief. Each tort claim is considered in turn.
A.

Intentional Infliction of Emotional Distress.

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Wright fails to state a claim for intentional infliction of emotional distress. The elements

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of the tort of intentional infliction of emotional distress are: (1) extreme and outrageous conduct

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by defendant with the intention of causing, or reckless disregard of the probability of causing,

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emotional distress; (2) plaintiff suffered severe or extreme emotional distress; and (3) actual and

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proximate causation of the emotional distress by defendant’s outrageous conduct. Christensen v.

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For the Northern District of California

United States District Court

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Superior Court., 54 Cal. 3d 868, 903 (1991).
The single sentence in Wright’s counterclaim pertaining to AMEX’s alleged intentional

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infliction of emotional distress reads: “(2005) Applied for AMEX Card, significance will

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become clear during trial” (Counter Compl. 13). In her opposition, Wright alleges that AMEX

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took her money, “accus[ed] her of criminal activity [and] slander, that I owe money, have

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criminals in my employ, printing fraudulent bills [sic]” (Opp. 11). A brief is not a complaint or

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counterclaim. These statements are not in the counterclaim. To count, they have to be properly

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in the complaint. Moreover, these statements are difficult to decipher, and nowhere does Wright

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identify any extreme and outrageous conduct that caused her to suffer severe emotional distress.

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B.

Negligence.

Wright similarly fails to identify any facts demonstrating that AMEX was negligent.

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Again, this section of Wright’s complaint focuses primarily on actions of the VA and physicians

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outside the present action. Wright’s opposition offers no illumination. Wright has thus failed

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to state a claim for negligence.

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C.

Slander and Libel.

Wright has failed to state a plausible claim for slander and libel. “Slander is a false and

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unprivileged publication, orally uttered,” which directly injures a person “in respect to his office,

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profession, trade or business” and “causes actual damage.” Cal. Civ. Code § 46. “Libel is a

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false and unprivileged publication by writing . . . which exposes any person to hatred, contempt,
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ridicule, or obloquy, or which causes him to be shunned or avoided, or which has a tendency to

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injure him in his occupation.” Cal. Civ. Code § 45.

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Wright alleges that AMEX “through deceit and thievery, while lying about [plaintiff’s]

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criminal activity,” committed libel by filing the present lawsuit (Counter Compl. 15).

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Wright fails to identify any false and unprivileged publications — oral or written — made

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by AMEX that accuse her of criminal activity. Nor has she demonstrated that she has suffered

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any injury. Accordingly, Wright fails to state a claim for slander or libel.

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D.

Oppression.

Included in the section heading for the claims for slander and libel, Wright includes
a claim for “oppression.” It is unclear what claim Wright is attempting to establish. In a tort

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For the Northern District of California

United States District Court

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action, a party is entitled to punitive damages if wrongful acts constitute oppression, fraud, or

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malice. Yan Sui v. Price, 196 Cal. App. 4th 933, 937 (2011). There is no independent tort of

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“oppression,” however. Because Wright has failed to state a plausible claim for any tort, the

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analysis of punitive damages is irrelevant. As such, AMEX’s motion to dismiss all of the tort

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claims is GRANTED.

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5.

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Wright also alleges fraud. Under California law, the required elements for fraud are:

FRAUD.

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(1) a misrepresentation; (2) knowledge of falsity; (3) intent to defraud; (4) justifiable reliance;

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and (5) resulting damage. In re Estate of Young, 160 Cal. App. 4th 62, 79 (2008). Wright argues

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that AMEX incorrectly represented that she missed payments and wrongly charged her fees and

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raised her interest rates (Counter Compl. 14). Wright falls short of pleading facts sufficient to

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satisfy all elements of fraud. Her vague allegations do not address the “who, what, when, where,

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and how” of the misconduct charged. Accordingly, the motion to dismiss the claim for fraud is

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GRANTED.

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CONCLUSION
For the foregoing reasons, AMEX’s motion to dismiss Wright’s counterclaim is

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GRANTED IN PART. AMEX’s motion to dismiss the breach-of-contract claim is DENIED.

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Its motion to dismiss all other claims is GRANTED. Wright may seek leave to amend the
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complaint and will have TWENTY-ONE CALENDAR DAYS from the date of this order to file a

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motion, noticed on the normal 35-day track, for leave to file an amended complaint. Wright

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must append to her motion a proposed amended complaint that clearly explains how the

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amendments cure the defects identified herein. Wright must also correctly label her captions to

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include only the parties in this action.

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IT IS SO ORDERED.

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Dated: December 1, 2011.

WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE

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For the Northern District of California

United States District Court

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