Apostol v. BMW Financial Services NA, LLC

Filing 33

ORDER RE TENTATIVE RULING AND NOTICE OF QUESTIONS FOR HEARING ON APRIL 8, 2016 AT 11:00 A.M. re 27 MOTION to Dismiss First Amended Complaint filed by BMW Financial Services NA, LLC. Signed by Judge Jeffrey S. White on 4/6/2016. (jswlc1, COURT STAFF) (Filed on 4/6/2016)

Case 4:15-cv-05137-JSW Document 33 Filed 04/06/16 Page 1 of 4

1
2
3
4

UNITED STATES DISTRICT COURT

5

NORTHERN DISTRICT OF CALIFORNIA

6
7

MEMORY APOSTOL,
Plaintiff,

8
9
10

TENTATIVE RULING AND NOTICE
OF QUESTIONS FOR HEARING

v.
BMW FINANCIAL SERVICES NA, LLC,

Re: Dkt. No. 27

Defendant.

11
United States District Court
Northern District of California

Case No. 15-cv-05137-JSW

12
13

TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD, PLEASE TAKE NOTICE

14

OF THE FOLLOWING TENTATIVE RULING AND QUESTIONS FOR THE HEARING

15

SCHEDULED ON APRIL 8, 2016 AT 11:00 A.M.

16
17
18

The parties shall be prepared to address the questions below at the hearing. The Court has
reviewed the parties’ briefs, and the parties shall not repeat the arguments set forth therein.
The parties shall not file written responses to this Notice of Questions for Hearing. If the

19

parties intend, at the hearing, to rely on legal authorities not cited in their briefs, they are

20

ORDERED to notify the Court and opposing counsel of these authorities reasonably in advance of

21

the hearing and to make copies of those authorities available at the hearing. If the parties submit

22

such additional authorities, they are ORDERED to submit the citations to the authorities only,

23

without argument or additional briefing. Cf. N.D. Civil Local Rule 7-3(d). The parties will be

24

given the opportunity at oral argument to explain their reliance on such authority.

25

1.

The first argument in Defendant’s motion to dismiss is that Plaintiff lacks standing

26

because she has received all relief afforded under the class settlement in Salimi v. BMW Financial

27

Services NA, LLC, No. 12-cv-01754-JSW. The Court notifies the parties that it is tentatively

28

inclined to reject this argument. Plaintiff’s First Amended Complaint is unambiguous that:

Case 4:15-cv-05137-JSW Document 33 Filed 04/06/16 Page 2 of 4

The Salimi case concluded with a class settlement, which was
approved by the court. Although plaintiff fell within the literal class
definition in the written settlement agreement, she ultimately was
not treated as a member of the class and is not bound by the
judgment, settlement, or release. This is because BMW Financial
did not give plaintiff any notice of the lawsuit. BMW Financial left
plaintiff off the class list, and did not mail her a class notice or give
her the opportunity to opt-out.

1
2
3
4
5

(First Amended Complaint, ¶ 7.) This is consistent with the allegations of Plaintiff’s original

6

Complaint in this action. (Complaint, ¶ 4.) In her opposition brief, Plaintiff expressly disclaims

7

any intention to rely on Salimi to prove her claims in this action. (E.g., Opp. at 9 (“Plaintiff will

8

prove the elements of her claims, including the violations of the Rees-Levering Act, without

9

invoking the terms of the Salimi settlement or judgment.”).) The Court tentatively finds that
because Plaintiff was not provided with the notice required by Federal Rule of Civil Procedure

11
United States District Court
Northern District of California

10

23(c)(2)(B), she is not bound by the settlement in Salimi. The Court does not require oral

12

argument on this issue.
2.

13

The second argument in Defendant’s motion to dismiss is that Plaintiff’s claim

14

under the California Consumer Credit Reporting Agencies Act (“CCRAA”) is preempted.

15

Defendant relies on Wang v. Asset Acceptance, LLC, 681 F. Supp. 2d 1143, 1147-48 (N.D. Cal.

16

2010). In Wang, a judge of the Northern District of California held that California Civil Code

17

section 1785.25(c) is preempted by the Federal Fair Credit Reporting Act (“FCRA”), 1 but section

18

1785.25(a) is not.2 Id. In Wang, the plaintiff tried to assert his claim under section 1785.25(a), in

19

order to avoid preemption, but the court held that the claim actually arose under section

20

1785.25(c), and therefore, was preempted. Id. Defendant contends that the same is true here.

21

In Wang, the plaintiff repeatedly alleged in the CCRAA cause of action that the defendant

22

failed to provide notice that the information provided to the consumer credit reporting agency was

23
24
25
26
27
28

1

Section 1785.25(c) provides: “So long as the completeness or accuracy of any information on a
specific transaction or experience furnished by any person to a consumer credit reporting agency is
subject to a continuing dispute between the affected consumer and that person, the person may not
furnish the information to any consumer credit reporting agency without also including a notice
that the information is disputed by the consumer.”
2

Section 1785.25(a) provides: “A person shall not furnish information on a specific transaction or
experience to any consumer credit reporting agency if the person knows or should know the
information is incomplete or inaccurate.”
2

Case 4:15-cv-05137-JSW Document 33 Filed 04/06/16 Page 3 of 4

1

disputed by the consumer. Id. at 1147. Here, in contrast, Plaintiff’s CCRAA cause of action does

2

not include any such allegations. (First Amended Complaint, ¶¶ 14-21.) Elsewhere in the First

3

Amended Complaint, in the “Operative Facts” section, the third sentence in Paragraph 6 reads:

4

“BMW Financial also failed to report plaintiff’s account as disputed, and thus also communicated

5

incomplete information about the account.” However, Paragraph 6 also alleges other ways in

6

which Defendant reported incomplete or inaccurate information under the section 1785.25(a).
a.

7
8

Should the Court, instead of holding that Plaintiff’s CCRAA claim is

preempted, simply strike the third sentence of Paragraph 6 from the Complaint?
b.

9

Should the Court consider as relevant to any issue the fact that Plaintiff

narrowed her Amended Complaint to remove the theory of liability based on section 1785.25(c)?

11
United States District Court
Northern District of California

10

See Shirley v. University of Idaho, 800 F.3d 1193, 1194-95 (9th Cir. 2015) (concurring opinions

12

discussing whether inconsistency with a prior complaint is a basis for dismissing a later amended

13

complaint).
3.

14
15

The third argument in Defendant’s motion to dismiss is that Plaintiff’s CCRAA

claim is time-barred.
a.

16

Defendant contends in its reply brief that because it is a good practice for a

17

consumer to check her credit report once a year, Plaintiff “should have known of” the alleged

18

violation no later than August 2012. Cal. Civil Code § 1785.33.3 Is either party aware of any

19

caselaw supporting or rejecting this position?
b.

20

Because Defendant allegedly provided incomplete or inaccurate information

21

to consumer credit reporting agencies on a monthly basis, does California’s “continuous accrual”

22

doctrine apply to Plaintiff’s claim? See Aryeh v. Canon Business Solutions, Inc., 55 Cal. 4th 1185,

23

1192 (2013) (“[U]nder the theory of continuous accrual, a series of wrongs or injuries may be

24
33

25
26
27
28

Section 1785.33 provides: “An action to enforce any liability created under this chapter may be
brought in any appropriate court of competent jurisdiction within two years from the date the
plaintiff knew of, or should have known of, the violation of this title, but not more than seven
years from the earliest date on which liability could have arisen, except that where a defendant has
materially and willfully misrepresented any information required under this chapter to be disclosed
to a consumer and the information so misrepresented is material to the establishment of the
defendant's liability to the consumer under this chapter, the action may be brought at any time
within two years after the discovery by the consumer of the misrepresentation.”
3

Case 4:15-cv-05137-JSW Document 33 Filed 04/06/16 Page 4 of 4

1

vie
ewed as each triggering its own limit
h
i
tations perio such that a suit for rel may be p
od,
lief
partially

2

tim
me-barred as to older eve but timely as to thos within the applicable l
ents
se
e
limitations p
period.”); cf.,
,

3

e.g Vasquez v. Bank of Am
g.,
v
merica, N.A., No. 15-cv-04072-RS, 2
2015 WL 70
075628, *4 (
(N.D. Cal.

4

No 13, 2015) (“If a bank repeatedly reports inacc
ov.
)
r
curate inform
mation to a c
credit reporti agency
ing

5

tha has a nega
at
ative impact on a consum
mer’s credit, each inaccur report is a separate and distinct
rate
s

6

har for which the FRCA provides a remedy.”); F
rm
h
r
Farrell v. Por
rtfolio Recov
very Assoc., No.

7

CV 14-03941 RGK, 2014 WL 7745881, * (C.D. C Sept. 19, 2014) (citin cases for proposition
V
R
W
Cal.
,
ng

8

tha “each trans
at
smission of the same cre report co
t
edit
onstitutes a s
separate clai to which a separate
im

9

lim
mitation perio applies,” including “w respect to CCRAA claims”).
od
with

10

United States District Court
Northern District of California

11
12
13
14
15
16

4.

The fourth argument in Defendant’s motion to d
a
s
dismiss is th Plaintiff’s CCRAA
hat
s

cla for relief fails to state a claim for 27 violatio ns.
aim
f
r
a.

Are the parties aware of any caselaw tha analyzes t question in light of
a
y
at
this
n

California Civi Code secti 1785.31(
il
ion
(a)(2)(B), wh
hich provide for damag “for each violation”?
es
ges
h
b.

Does the FCRA contain any language th is paralle to section
y
hat
el

178
85.31(a)(2)(B
B)?
c.

If ea inaccurat credit repo is a separ and dist
ach
te
ort
rate
tinct injury f the
for

17

pur
rpose of the statute of lim
mitations, is it also a sep
parate and di
istinct violati under se
ion
ection

18

178
85.31(a)(2)(B
B)?

19
20

IT IS SO ORDER
S
RED.
Da
ated: April 6, 2016
,

21
22
JE
EFFREY S. W
WHITE
Un
nited States D
District Judg
ge

23
24
25
26
27
28
4