Noel v. Bank Of America

Filing 15

Order by Hon. Samuel Conti granting 7 Motion to Dismiss.(sclc2, COURT STAFF) (Filed on 11/8/2012)

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1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE NORTHERN DISTRICT OF CALIFORNIA 8 LAUREN NOEL, Plaintiff, 10 For the Northern District of California United States District Court 9 v. 11 12 BANK OF AMERICA, 13 Defendant. 14 ) Case No. 12-4019-SC ) ) ORDER GRANTING DEFENDANT'S ) MOTION TO DISMISS ) ) ) ) ) ) ) 15 16 17 I. INTRODUCTION On July 31, 2012, Plaintiff Lauren Noel ("Plaintiff") filed a 18 complaint naming Bank of America ("BOA") as the sole defendant. 19 ECF No. 1 ("Compl."). 20 from BOA's alleged attempts to collect a consumer credit card debt 21 from Plaintiff: (1) violation of the Fair Debt Collection Practices 22 Act, 15 U.S.C. § 1692 et seq. ("FDCPA"); (2) violation of the Fair 23 Credit Reporting Act, 15 U.S.C. § 1681 et seq. ("FCRA"); (3) unfair 24 business practices under California's Unfair Competition Law, Cal. 25 Bus. & Prof. Code § 17200 et seq. ("UCL"); (4) violation of the 26 Rosenthal Fair Debt Collection Practices Act, Cal. Civ. Code § 1788 27 et seq. ("RFDCPA"); and (5) negligence per se, based on BOA's 28 alleged failure to comply with the FDCPA, FCRA, UCL, and RFDCPA. The complaint asserts five claims arising On August 27, 2012, FIA Card Services, N.A. ("FIA") came 1 2 forward as a defendant and filed a certificate and notice of 3 interested parties in which it certified that it is a wholly-owned 4 subsidiary of Bank of America Corporation. 5 Concurrently, FIA filed a motion to dismiss Plaintiff's complaint 6 pursuant to Federal Rule of Civil Procedure 12(b)(6). 7 ("Mot."). 8 FIA is the real party in interest. ECF No. 8. ECF No. 7 FIA represents that Plaintiff sued BOA in error and that See id. at 3. FIA's motion to dismiss is now pending before the Court. 9 United States District Court 10 For the Northern District of California ECF Nos. 10 ("Opp'n"), 14 ("Reply"). It has been fully briefed. 11 oral argument is needed. 12 forth herein, the Court GRANTS FIA's motion to dismiss. 13 DISMISSES Plaintiff's complaint, in part with prejudice and in part 14 with leave to amend, as set forth below. Civ. L.R. 7-1(b). No For the reasons set The Court 15 16 17 II. BACKGROUND Plaintiff alleges that she paid off any debt she may once have 18 owed to BOA. Compl. ¶ 13. 19 assistance from counsel to address BOA's allegedly "aggressive and 20 harassing collection efforts." 21 through counsel, she sent to BOA via facsimile a letter which 22 "disputed the debt purportedly owed, sought an accounting, and 23 demanded that collections efforts cease and desist." 24 id. Ex. A ("April 29 Letter"). 25 the April 29 Letter, BOA "actually increased its collection 26 efforts, using not only multiple telephone calls but also text 27 messages." 28 another letter to BOA on May 18, 2009. Id. ¶ 22. She alleges that, in 2009, she sought Id. ¶ 14. On April 29, 2009, Id. ¶¶ 20-21; Plaintiff alleges that, following This prompted Plaintiff's counsel to fax 2 Id. ¶¶ 23-24; id. Ex. B 1 ("May 18 Letter"). 2 contacted various entities -- apparently, debt collectors -- and 3 collection efforts ceased. 4 Over the next few months, Plaintiff's counsel Id. ¶¶ 25-29. Plaintiff alleges that, "[d]uring the summer of 2011, 5 Plaintiff attempted to purchase a home and learned that she would 6 be forced to continue renting due to credit reporting by Defendants 7 [sic]." 8 reports with all three credit reporting agencies." 9 Plaintiff allegedly received an investigation report from the Id. ¶ 30. Plaintiff alleges that she "contested the Id. ¶ 31. United States District Court For the Northern District of California 10 credit reporting agency TransUnion, dated August 30, 2011, which 11 shows that BOA "reported the debt as verified with no change." 12 ¶ 31; id. Ex. E ("Report"). 13 received another debt collection attempt from a non-BOA entity in 14 the spring of 2012, but that this entity "ceased collections 15 shortly thereafter." 16 BOA "continued to fail to correct its reporting of the invalidated 17 debt" and represented to her that BOA "would do nothing but attempt 18 to report the alleged debt as 'sold.'" Id. Plaintiff alleges that her counsel Id. ¶¶ 33-34. Plaintiff further alleges that Id. ¶ 35. 19 20 21 III. LEGAL STANDARD A motion to dismiss under Federal Rule of Civil Procedure 22 12(b)(6) "tests the legal sufficiency of a claim." Navarro v. 23 Block, 250 F.3d 729, 732 (9th Cir. 2001). 24 on the lack of a cognizable legal theory or the absence of 25 sufficient facts alleged under a cognizable legal theory." 26 Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 27 1988). 28 should assume their veracity and then determine whether they "Dismissal can be based "When there are well-pleaded factual allegations, a court 3 1 plausibly give rise to an entitlement to relief." Ashcroft v. 2 Iqbal, 556 U.S. 662, 679 (2009). 3 must accept as true all of the allegations contained in a complaint 4 is inapplicable to legal conclusions. 5 elements of a cause of action, supported by mere conclusory 6 statements, do not suffice." 7 Twombly, 550 U.S. 544, 555 (2007)). 8 complaint must be both "sufficiently detailed to give fair notice 9 to the opposing party of the nature of the claim so that the party However, "the tenet that a court Threadbare recitals of the Id. at 678 (citing Bell Atl. Corp. v. The allegations made in a United States District Court For the Northern District of California 10 may effectively defend against it" and "sufficiently plausible" 11 such that "it is not unfair to require the opposing party to be 12 subjected to the expense of discovery." 13 1191, 1204 (9th Cir. 2011). Starr v. Baca, 633 F.3d 14 15 IV. DISCUSSION 16 A. General Pleading Defects 17 For at least two reasons, the complaint as a whole is 18 insufficiently pled and therefore subject to dismissal. 19 is that Plaintiff has not named a legal entity as a defendant. 20 Court is unaware of any entity named "Bank of America" (as opposed 21 to, for example, "Bank of America, N.A."). 22 Am., CIV. 10-00551, 2011 WL 240813, at *3 (D. Haw. Jan. 21, 2011) 23 (observing that "Bank of America" is "not a legal entity" and 24 dismissing case with leave to file amended complaint "against a 25 properly-named defendant or defendants"). 26 Plaintiff takes the position that BOA acted as a debt collector on 27 behalf of FIA. 28 itself alleges no relationship between BOA and FIA, because it does Opp'n at 2. The first The See Phillips v. Bank of In her opposition, That may be so, but the complaint 4 1 not mention FIA. Neither does it allege who owns or owned the 2 alleged debt that Plaintiff allegedly satisfied. 3 amends her complaint, she shall properly name a legal entity as 4 defendant, and she shall allege the owner of the alleged debt in 5 addition to the identity of the alleged debt collector. If Plaintiff 6 The second reason Plaintiff's pleading fails as a general 7 matter is that it does not plainly state which allegations support 8 which claim. 9 single factual account. Plaintiff sets out her factual allegations in a Compl. ¶¶ 13-36. Each of her five claims Id. ¶¶ 37, 41, 46, 51, United States District Court For the Northern District of California 10 then incorporates these facts by reference. 11 54. 12 recital[] of the elements of a cause of action, supported by mere 13 conclusory statements." 14 depends solely on the factual allegations incorporated by 15 reference. 16 The remainder of each claim consists of a "[t]hreadbare Iqbal, 556 U.S. at 678. Each claim, then, Incorporation by reference is sometimes warranted and, 17 "[p]roperly used, such incorporation promotes simple, concise 18 pleadings." 19 at *4 (E.D. Cal. Jan. 8, 2009) aff'd sub nom. Destfino v. Reiswig, 20 630 F.3d 952 (9th Cir. 2011). 21 connected specific allegations to the elements of her claims. 22 There is no way to tell which allegedly wrongful act goes with 23 which legal claim. 24 articulate why the alleged conduct is unlawful. 25 fails to satisfy Rule 8(a)'s requirement that the pleading set 26 forth a "short and plain statement" of the facts giving rise to 27 each claim for relief. 28 to amend her complaint, each claim must be set out with a short and Destfino v. Kennedy, CVF081269LJODLB, 2009 WL 63566, Here, however, Plaintiff has not Put another way, Plaintiff has yet to Plaintiff thus Plaintiff is advised that, if she chooses 5 1 plain statement of the specific factual allegations supporting that 2 claim. The Court also observes that Plaintiff, in both her complaint 3 4 and opposition, emphasizes allegations that Defendant "lied to 5 her." 6 not to bring a claim for misrepresentation, her allegations of 7 lying sound in fraud and hence are subject to Rule 9(b), which 8 requires Plaintiff to "state with particularity the circumstances 9 constituting fraud . . . ." Compl. ¶¶ 15-16; Opp'n at 2. Though Plaintiff has chosen Fed. R. Civ. P. 9(b). "To satisfy United States District Court For the Northern District of California 10 Rule 9(b), a pleading must identify 'the who, what, when, where, 11 and how of the misconduct charged,' as well as 'what is false or 12 misleading about [the purportedly fraudulent] statement, and why it 13 is false.'" 14 637 F.3d 1047, 1055 (9th Cir. 2011) (internal citations omitted). 15 Plaintiff's allegations, which omit what was said, when, by whom, 16 under what circumstances, or why the statements were false, fall 17 far short of satisfying this standard. 18 misrepresentation must comply with Rule 9(b). Cafasso, U.S. ex rel. v. Gen. Dynamics C4 Sys., Inc., Any further allegations of Because the entire complaint is inadequately pled and thus 19 20 subject to dismissal, the next question is whether any of 21 Plaintiff's claims shall be dismissed with prejudice. 22 district court should grant leave to amend . . . unless it 23 determines that the pleading could not possibly be cured by the 24 allegation of other facts." 25 1105 (9th Cir. 2011) (quoting Lopez v. Smith, 203 F.3d 1122, 1130 26 (9th Cir. 2000)). 27 Plaintiff's individual claims. 28 /// "[A] Silva v. Di Vittorio, 658 F.3d 1090, With this standard in mind, the Court turns to 6 1 B. FDCPA 2 The FDCPA applies to debt collectors. 15 U.S.C. § 1692a(6). 3 It does not, however, apply to creditors who seek to collect a debt 4 in their own right. 5 Plaintiff's FDCPA claim fails as a matter of law because FIA is not 6 a debt collector within the meaning of § 1692a(6); rather, FIA 7 avers, it is a creditor seeking to collect its own debt. 8 5. 9 owns the debt. Id. § 1692a(6)(A). FIA argues that Mot. at However, as explained above, the complaint does not allege who Accordingly, the Court cannot ascertain whether the United States District Court For the Northern District of California 10 alleged debt is one allegedly owned by FIA or some other entity. 11 The Court is aware of FIA's position that it is part of BOA 12 and the real party in interest, and of the authorities FIA has 13 marshaled in support of this point. 14 However, the complaint names BOA, not FIA, and at this juncture the 15 Court is not inclined to reach beyond the boundaries of the 16 complaint and impute BOA's conduct to FIA, or vice-versa. 17 would amount to a de facto revision of Plaintiff's complaint. 18 Plaintiff is master of her complaint and she will have another 19 opportunity to set forth her allegations against the party she 20 indeed wants to sue. 21 Reply at 2-3 (citing cases). Doing so The Court also acknowledges Plaintiff's argument that BOA 22 serves as a debt collector on behalf of FIA. Opp'n at 3; see also 23 Compl. ¶ 38 (alleging, in its entirety, that "Defendants [sic] are 24 debt collectors as defined by 15 U.S.C. [§] 1692a(6)"). 25 facts must be alleged in a pleading, not the moving papers. 26 noted above, Plaintiff's complaint does not mention FIA or explain 27 its relationship to BOA, which, in any event, is not a legal 28 entity. However, As Moreover, Plaintiff's argument rests on the premise that 7 1 BOA is a debt collector. 2 debt collector is a legal conclusion, not a factual allegation 3 entitled to the presumption of truth. 4 Because the FDCPA defines "debt collector" to include one who 5 collects a debt on behalf of another but to exclude those who 6 collect on their own debts, Plaintiff needs to allege facts 7 addressing the ownership of the debt. Iqbal, 556 U.S. at 680. The Court DISMISSES Plaintiff's FDCPA claim. 8 9 But Plaintiff's statement that BOA is a Plaintiff has leave to amend this claim consistent with the guidance herein. United States District Court For the Northern District of California 10 C. FCRA 11 The FCRA requires "furnishers of information . . . to consumer 12 reporting agencies to provide accurate information" regarding a 13 consumer's debt. 14 however, there is no private right of action to enforce the 15 obligations established by § 1681s–2(a). 16 Manhattan Mortgage Corp., 282 F.3d 1057, 1059 (9th Cir. 2002) 17 (holding that only federal and state officials can enforce the 18 provisions set forth in § 1681s–2(a)). 15 U.S.C. § 1681s–2(a). As FIA correctly notes, See Nelson v. Chase The FCRA does, however, confer a private right of action upon 19 20 consumers and allow them to sue a furnisher of credit information 21 if such furnisher breaches any of the duties enumerated in § 1681s– 22 2(b). 23 (9th Cir. 2009). 24 furnisher receives notice of dispute from a [credit reporting 25 agency] . . . ." 26 credit information furnished to the three credit reporting agencies 27 by BOA. 28 is not named in the complaint) ever received notice of the dispute. See Gorman v. Wolpoff & Abramson, LLP, 584 F.3d 1147, 1154 However, "[t]hese duties arise only after the Id. Here, Plaintiff alleges that she contested However, she does not allege that BOA (let alone FIA, who 8 1 Moreover, to state a claim for furnishing inaccurate information, 2 Plaintiff must identify which information is inaccurate. 3 Carvalho v. Equifax Info. Servs., LLC, 588 F. Supp. 2d 1089, 1096 4 (N.D. Cal. 2008) aff'd, 629 F.3d 876 (9th Cir. 2010). 5 points out, Mot. at 7-8, Plaintiff has not done so. 6 Plaintiff has not stated a claim under § 1681s-2(b). 7 The Court DISMISSES Plaintiff's FCRA claim. See As FIA Accordingly, This claim is 8 dismissed with prejudice to the extent it is premised on alleged 9 violations of § 1681s-2(a), for which there is no private right of United States District Court For the Northern District of California 10 action. Plaintiff has leave to amend to assert a claim based on § 11 1681s-2(b). 12 D. 13 The UCL provides plaintiffs with three theories of relief, or UCL 14 "prongs," under which to challenge a business practice: 15 unlawfulness, unfairness, or fraud. 16 Cal. App. 4th 832, 838-39 (Cal. Ct. App. 1994) (distinguishing 17 prongs). 18 means to invoke. 19 articulate a recognizable legal theory, along with a paucity of 20 factual allegations, justifies dismissal of her UCL claim. 21 See Saunders v. Sup. Court, 27 Plaintiff does not identify which prong of the UCL she See Compl. ¶¶ 46-50. Plaintiff's failure to FIA argues that giving Plaintiff leave to amend this claim 22 would be improper because the FCRA preempts all state-law claims 23 based on conduct which also violates § 1681s–2(b). 24 Reply at 4. 25 Plaintiff is proceeding on a UCL unlawfulness theory, since the 26 authorities FIA cites deal with the unlawfulness prong. 27 Howard v. Blue Ridge Bank, 371 F. Supp. 2d 1139, 1143-44 (N.D. Cal. 28 2005). Mot. at 8-9; First, the Court notes that FIA appears to assume that E.g., As the Court explained in the previous paragraph, that may 9 1 or may not be so. But assuming it is true that Plaintiff's UCL 2 claim rests on the UCL's unlawfulness prong, the Court believes 3 that Defendant overstates the preemptive effect of the FCRA on UCL 4 unlawfulness claims. 5 courts in this circuit have adopted a variety of approaches to 6 determining the preemptive effect of the FCRA, some of which sweep 7 more broadly than others. 8 Ass'n, C 12-01857 WHA, 2012 WL 1980416, at *3-6 (N.D. Cal. June 1, 9 2012). As this Court recently explained, district See Subhani v. JPMorgan Chase Bank, Nat. Even applying the "total preemption" approach that FIA United States District Court For the Northern District of California 10 tacitly endorses, UCL claims based on violations of section 11 1785.25(a) of the California Consumer Credit Reporting Agencies Act 12 are not preempted. 13 assumptions are correct, the Court would be inclined to give 14 Plaintiff leave to amend to assert a UCL unlawfulness claim based 15 on section 1785.25(a). 16 Id. at *7. Accordingly, even if FIA's As the matter stands, however, Plaintiff has yet to articulate 17 with precision the legal basis of her UCL claim. Accordingly, the 18 Court DISMISSES Plaintiff's UCL claim. 19 amend it consistent with the guidance provided in this order. 20 Plaintiff must articulate a cognizable theory of recovery under at 21 least one clearly identified UCL prong, along with specific factual 22 allegations supporting that claim. Plaintiff has leave to 23 E. RFDCPA 24 "Like the FDCPA, the RFDCPA applies only to debt collectors." 25 Izenberg v. ETS Services, LLC, 589 F. Supp. 2d 1193, 1199 (C.D. 26 Cal. 2008). 27 statute is broader than that contained in the FDCPA, however." 28 "The RFDCPA defines a 'debt collector' as 'any person who, in the "The definition of 'debt collector' found in the state 10 Id. 1 ordinary course of business, regularly, on behalf of himself or 2 herself or others, engages in debt collection.'" 3 added) (quoting Cal. Civ. Code § 1788.2(c)). 4 Plaintiff's FDCPA claim fails in part because it fails to allege 5 that Plaintiff's alleged debt was being collected on behalf of 6 another, Plaintiff's RFDCPA claim cannot fail for that reason: The 7 RFDCPA covers entities that collect a debt on their own behalf. 8 9 Id. (emphasis Accordingly, while However, Plaintiff's claim still fails as insufficiently pled. Plaintiff's pleading does not go beyond legal conclusions. In United States District Court For the Northern District of California 10 pertinent part, "Plaintiff alleges a violation of RFDCPA, Cal. Civ. 11 Code § 1788 et seq." and that the violations "were done willfully 12 and knowingly to coerce Plaintiff into paying the alleged debt." 13 Compl. ¶¶ 52-53. 14 legal conclusions, and declines even to identify which section of 15 the RFDCPA allegedly was violated. 16 Plaintiff identifies no facts supporting these Accordingly, the Court DISMISSES Plaintiff's RFDCPA claim. 17 Plaintiff has leave to amend this claim, but must articulate a 18 cognizable legal theory supported by specific facts. 19 F. 20 Plaintiff's negligence claim relies on the doctrine of 21 22 23 24 25 26 27 28 Negligence Per Se negligence per se. Under that doctrine, negligence is presumed if the plaintiff establishes four elements: (1) the defendant violated a statute, ordinance, or regulation of a public entity; (2) the violation proximately caused death or injury to person or property; (3) the death or injury resulted from an occurrence of the nature of which the statute, ordinance, or regulation was designed to prevent; and (4) the person suffering the death or the injury to his person or property was one of the class of persons for whose protection the statute, ordinance, or regulation was adopted. The first two elements are normally 11 questions for the trier of fact, while the latter two elements are determined by the trial court as a matter of law. 1 2 3 Galvez v. Frields, 88 Cal. App. 4th 1410, 1420 (Cal. Ct. App. 4 2001). 5 Here, Plaintiff's claim of per se negligence is premised on 6 asserted violations of the FDCPA, FCRA, UCL, and RFDCPA. Compl. ¶¶ 7 54-58. 8 her negligence per se claim also fails. 9 is some question about the scope of FCRA preemption as applied to Because each of her claims under those laws fails as pled, Moreover, although there United States District Court For the Northern District of California 10 Plaintiff's UCL claim, there is none as applied to a negligence 11 claim: such claims are specifically preempted by statute. 12 U.S.C. § 1681h(e). 13 unlimited. 14 state claims for defamation, invasion of privacy and negligence and 15 only to the extent such claims are based on the disclosure of 16 certain types of information and are not based on malice or willful 17 intent to injure." 18 quotation marks omitted). 19 falls within the scope of preemption to the extent it is based on 20 an alleged FCRA violation, and her complaint contains no 21 allegations of malice or willful intent to injure. 22 extent that Plaintiff's negligence per se claim relies on conduct 23 that violates the FCRA, it fails as a matter of law. 24 See 15 The preemptive scope of § 1681h(e) is not "By its plain terms, Section 1681h(e) only preempts Subhani, 2012 WL 1980416, at *3 (internal Plaintiff's negligence claim clearly Hence, to the Accordingly, Plaintiff's negligence per se claim is DISMISSED. 25 The dismissal is with prejudice insofar as Plaintiff's negligence 26 claim depends on conduct that violates the FCRA. 27 plaintiff has leave to amend this claim consistent with the 28 guidance herein. 12 Otherwise, 1 2 V. CONCLUSION For the foregoing reasons, the Court GRANTS FIA Card Services, 3 N.A.'s motion to dismiss the complaint of Plaintiff Lauren Noel. 4 The Court DISMISSES Plaintiff's claims as follows: 5 • Claim 1 (FDCPA) is dismissed with leave to amend. 6 • Claim 2 (FCRA) is dismissed with prejudice to the extent 7 it is based on 15 U.S.C. § 1681s–2(a), which provides no 8 private right of action. 9 to amend this claim. Plaintiff otherwise has leave United States District Court For the Northern District of California 10 • Claim 3 (UCL) is dismissed with leave to amend. 11 • Claim 4 (RFDCPA) is dismissed with leave to amend. 12 • Claim 5 (negligence per se) is dismissed with prejudice 13 to the extent it is based on alleged violations of the 14 FCRA, negligence claims for such conduct being preempted. 15 Plaintiff otherwise has leave to amend this claim. 16 Any amendments shall be consistent with the guidance contained 17 in this order. Plaintiff shall file her amended complaint within 18 thirty (30) days of the signature date of this Order. 19 do so shall result in dismissal of this case with prejudice. Failure to 20 21 IT IS SO ORDERED. 22 23 24 Dated: November 8, 2012 UNITED STATES DISTRICT JUDGE 25 26 27 28 13

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