Smith v. Patenaude & Felix A.P.C., Law Offices of

Filing 12

ORDER: The Motion to Dismiss is granted. The First Amended Complaint is dismissed without prejudice. No later than thirty days from the date this Order is filed, Plaintiff may file a motion for leave to amend the First Amended Complaint accompanied b y a proposed second amended complaint. If Plaintiff does not file a motion for leave to amend, this case shall remain closed without further order of the Court. Signed by Judge William Q. Hayes on 7/23/2014. (All non-registered users served via U.S. Mail Service.) (mdc)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 KRISTIANE SMITH, 11 12 13 14 15 vs. CASE NO. 13cv3061-WQH (BGS) Plaintiff, ORDER LAW OFFICES OF PATENAUDE & FELIX, A.P.C., Defendant. 16 HAYES, Judge: 17 The matter before the Court is the Motion to Dismiss filed by Defendant Law 18 Offices of Patenaude & Felix A.P.C. (ECF No. 8). 19 BACKGROUND 20 On December 17, 2013, Plaintiff initiated this action by filing a Complaint 21 against Defendant Law Offices of Patenaude & Felix, A.P.C. (ECF No. 1). On 22 February 3, 2014, Plaintiff filed a First Amended Complaint alleging violations of the 23 Fair Credit Reporting Act, 15 U.S.C. § 1681b (“FCRA”), the Fair Debt Collection 24 Practices Act, 15 U.S.C. § 1692g(a) (“FDCPA”), and the Rosenthal Fair Debt 25 Collection Practices Act, Cal. Civ. Code § 1788.15(a) (“RFDCPA”). (ECF No. 6). 26 On February 17, 2014, Defendant filed a Motion to Dismiss for Failure to State 27 a Claim. (ECF No. 8). On March 3, 2014, Plaintiff filed a response to the Motion to 28 Dismiss. (ECF No. 9). On March 10, 2014, Defendant filed a reply. (ECF No. 10). -1- 13cv3061-WQH-BGS 1 2 ALLEGATIONS OF THE FIRST AMENDED COMPLAINT Plaintiff alleges that on April 25, 2013, Defendant initiated a “hard pull of 3 Plaintiff’s credit report from TransUnion without permissible purpose, thereby reducing 4 her credit score” and violating the FCRA. (ECF No. 6 at ¶ 7). Plaintiff alleges that 5 Defendant violated the FDCPA because it “did not act in accordance with the 6 provisions and definitions in regards to the term ‘account’,” and “failed to provide a 30 7 day validation notice to the Plaintiff.” Id. at ¶¶ 7-8. Plaintiff alleges that Defendant 8 violated the RFDCPA when it “attempted to collect on consumer debt when service of 9 process was not legally effected” and that she had no contractual agreement with 10 Defendant. Id. at ¶¶ 9-10. Plaintiff demands $1,000 in damages for violation of each 11 statute, totaling $3,000 in damages. Id. at ¶¶ 14, 19, 26. 12 DISCUSSION 13 I. Request for Judicial Notice 14 Defendant has submitted a request for judicial notice of the summons and 15 complaint filed on June 19, 2013, in the Superior Court of California for the County of 16 Sacramento, entitled TD Bank USA, N.A., As Successor in Interest to Target National 17 Bank v. Kristiane Smith, case number 34-2013-00146865. (ECF No. 8-1). Federal Rule 18 of Evidence 201 provides that “a judicially noticed fact must be one not subject to 19 reasonable dispute in that it is ... capable of accurate and ready determination by resort 20 to sources whose accuracy cannot reasonably be questioned.” Fed R. Evid. 210(b). 21 Courts may take judicial notice of their own records, and may also take judicial notice 22 of other courts’ proceedings if they “directly relate to matters before the court.” Hayes 23 v. Woodford, 444 F. Supp. 2d 1127, 1136-37 (S.D. Cal. 2006); see also United States 24 ex rel. Robinson Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th 25 Cir. 1992). The unopposed request for judicial notice is granted. 26 II. Contentions of the Parties 27 Defendant contends that “Plaintiff obtained and used a credit card issued by TD 28 Bank, U.S.A., N.A., as successor in interest to Target National Bank, and failed to pay -2- 13cv3061-WQH-BGS 1 it.” (ECF No. 8 at 3). Defendant contends that it is a debt collector who was retained 2 by Target National Bank (“Target”) to collect Plaintiff’s delinquent credit card debts. 3 Defendant contends that it pulled Plaintiff’s credit report for the purpose of collection 4 on the account, a permissible purpose under the FCRA. Defendant contends Plaintiff’s 5 First Amended Complaint fails to allege sufficient facts to state a claim and dismissal 6 without leave to amend is warranted because the defects of the First Amended 7 Complaint are incurable. 8 Plaintiff contends she was not aware of Defendant’s “hard pull” of her credit 9 report until November 10, 2013 after reviewing her credit report. (ECF No. 9 at 2). 10 Plaintiff contends that Defendant failed to send a demand request, filed suit without 11 notice, and failed to send initial communication to Plaintiff. Id. at 4-5. Plaintiff 12 contends she never received the initial demand letter and that Defendant has no 13 evidence to prove the initial demand letter was mailed to her, including proof of mailing 14 or receipt. Id. at 5. Plaintiff contends Defendant obtained her credit report without a 15 permissible purpose. Id. at 4. Plaintiff contends Defendant violated the RFDCPA by 16 concealing the state court suit and refusing “to legally serve the Summons on the 17 Plaintiff.” Id. at 6. 18 III. Standard of Review 19 Federal Rule of Civil Procedure 12(b)(6) permits dismissal for “failure to state 20 a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). To sufficiently 21 state a claim for relief and survive a Rule 12(b)(6) motion, a complaint “does not need 22 detailed factual allegations” but the “[f]actual allegations must be enough to raise a right 23 to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 24 (2007). “[A] plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to 25 relief’ requires more than labels and conclusions, and a formulaic recitation of the 26 elements of a cause of action will not do.” Id. (quoting Fed. R. Civ. P. 8(a)(2)). When 27 considering a motion to dismiss, a court must accept as true all “well-pleaded factual 28 allegations.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 1950 (2009). -3- For 13cv3061-WQH-BGS 1 purposes of reviewing dismissal for failure to state claim, all allegations of material fact 2 are taken as true and construed in the light most favorable to the nonmoving party. 3 Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-338 (9th Cir. 1996). However, a court 4 is not “required to accept as true allegations that are merely conclusory, unwarranted 5 deductions of fact, or unreasonable inferences.” Sprewell v. Golden State Warriors, 266 6 F.3d 979, 988 (9th Cir. 2001). “In sum, for a complaint to survive a motion to dismiss, 7 the non-conclusory factual content, and reasonable inferences from that content, must 8 be plausibly suggestive of a claim entitling the plaintiff to relief.” Moss v. U.S. Secret 9 Serv., 572 F.3d 962, 969 (9th Cir. 2009) (quotations omitted). 10 IV. Federal Law Claims 11 A. 12 The FCRA imposes civil liability against “[a]ny person who obtains a consumer FCRA 13 report from a consumer reporting agency under false pretenses or knowingly without 14 a permissible purpose....” 15 U.S.C. §§ 1681n(b). A consumer report is “any 15 information by a consumer reporting agency bearing on a consumer’s credit 16 worthiness....” 15 U.S.C. § 1681a(d)(1). The FCRA lists several permissible purposes 17 for obtaining a consumer report, including that a consumer reporting agency may 18 provide a consumer report to “a person which it has reason to believe ... intends to use 19 the information in connection with a credit transaction involving the consumer on 20 whom the information is to be furnished and involving the extension of credit to, or 21 review or collection of an account of, the consumer....” 15 U.S.C. §1681b. 22 “A collection agency is permitted to obtain a consumer report if the agency is 23 doing so for the purposes of collecting a debt.” Pyle v. First Nat. Collection Bureau, 24 No. 1:12cv288-AWI-SKO, 2012 WL 1413970, at *3 (E.D. Cal. Apr. 23, 2012) 25 (concluding that plaintiff’s allegations that he “never at anytime had any business 26 dealing or accounts with the Defendant” were vague and conclusory and failed to 27 establish that Defendant’s activities were impermissible.). “Where a permissible 28 purpose for obtaining the credit information is demonstrated, then as a matter of law, -4- 13cv3061-WQH-BGS 1 the information cannot have been obtained under false pretenses.” Perretta v. Capital 2 Acquisitions & Mgmt Co., No. C-02-05561 RMW, 2003 WL 21383757, at *5 (N.D. 3 Cal. May 5, 2003) (granting a motion to dismiss an FCRA claim because “defendant 4 obtained plaintiff’s consumer report ... in connection with an effort to collect a debt.”) 5 (citations omitted). 6 The First Amended Complaint’s allegation that Defendant “violated the FCRA 7 by initiating a hard pull of Plaintiff’s credit report from TransUnion without permissible 8 purpose, thereby reducing her credit score” (ECF No. 6 at ¶ 7) is conclusory and 9 insufficient to state a claim without additional factual allegations. See Twombly, 550 10 U.S. at 555. The Court finds that the First Amended Complaint fails to allege sufficient 11 facts to show that Defendant violated the FCRA. The Motion to Dismiss the FCRA 12 claim is granted. 13 B. FDCPA 14 Congress enacted the FDCPA to “eliminate the recurring problem of debt 15 collectors dunning the wrong person or attempting to collect debts which the consumer 16 has already paid.” Swanson v. Southern Oregon Credit Serv., Inc., 869 F.2d 1222, 1225 17 (9th Cir. 1988). Section 1692g(a) requires that the initial communication with a 18 consumer in connection with a debt contain: (1) the amount of the debt; (2) the name 19 of the creditor; (3) a statement that if the consumer, within thirty days after receipt of 20 the notice disputes the validity of the debt, or any portion thereof, the debt will be 21 assumed to be valid by the debt collector; (4) a statement that if the consumer disputes 22 the debt, the debt collector will mail the consumer verification of the debt or a copy of 23 a judgment; and (5) a statement that, upon the consumer’s written request, the debt 24 collector will provide the consumer with the name and address of the original creditor, 25 if different from the current creditor. 15 U.S.C. § 1692g(a)(1)-(5); see also Terran v. 26 Kaplan, 109 F.3d 1428, 1431 (9th Cir. 1997). The term communication means “the 27 conveying of information regarding a debt directly or indirectly to any person through 28 any medium.” 15 U.S.C. § 1692a(2). The initial communication need only be sent by -5- 13cv3061-WQH-BGS 1 the debt collector who is under no obligation to establish receipt by the debtor. Mahon 2 v. Credit Bureau of Placer Cnty. Inc., 171 F.3d 1197, 1201 (9th Cir. 1999). Under the 3 common law Mailbox Rule, “proper and timely mailing of a document raises a 4 rebuttable presumption that it is received by the addressee.” Id. at 1202. To overcome 5 this rebuttable presumption of mailing and receipt, a debtor must prove “by clear and 6 convincing evidence that the mailing was not, in fact, accomplished.” In re Bucknum, 7 951 F.2d 204, 207 (9th Cir. 1991); see also Grant v. Unifund CCR Partners, 842 F. 8 Supp. 2d 1234, 1241 (finding debtor’s only evidence—that she never received the 9 letter—insufficient to overcome the rebuttable presumption). 10 The First Amended Complaint’s allegation that Defendant “violated the FDCPA 11 when [it] failed to provide a 30 day validation notice to the Plaintiff” (ECF No. 6 ¶¶ 12 8, 19) is conclusory and insufficient to state a claim without additional factual 13 allegations. See Twombly, 550 U.S. at 555. The Court finds that the First Amended 14 Complaint fails to allege sufficient facts to show that Defendant violated the FDCPA. 15 The Motion to Dismiss the FDCPA claim is granted. 16 V. State Law Claim 17 The federal supplemental jurisdiction statute provides: “[I]n any civil action of 18 which the district courts have original jurisdiction, the district courts shall have 19 supplemental jurisdiction over all other claims that are so related to claims in the action 20 within such original jurisdiction that they form part of the same case or controversy 21 under Article III of the United States Constitution.” 28 U.S.C. § 1367(a). A district 22 court may decline to exercise supplemental jurisdiction over a state law claim “if ... the 23 district court has dismissed all claims over which it has original jurisdiction.” 28 U.S.C. 24 §1367(c)(3). In this case, the Court has dismissed the federal claims. The Court 25 declines to exercise supplemental jurisdiction over the remaining state law claim, which 26 alleges a violation of the RFDCPA. See Ove v. Gwinn, 264 F.3d 817, 826 (9th Cir. 27 2001) (“A court may decline to exercise supplemental jurisdiction over related state-law 28 claims once it has dismissed all claims over which it has original jurisdiction.”). -6- 13cv3061-WQH-BGS 1 2 CONCLUSION IT IS HEREBY ORDERED that the Motion to Dismiss (ECF No. 6) is 3 GRANTED. The First Amended Complaint is DISMISSED without prejudice. No 4 later than thirty days from the date this Order is filed, Plaintiff may file a motion for 5 leave to amend the First Amended Complaint accompanied by a proposed second 6 amended complaint. The second amended complaint must be complete in itself and 7 may not incorporate by reference prior versions of the complaint or other filings in this 8 action. If Plaintiff does not file a motion for leave to amend, this case shall remain 9 closed without further order of the Court. 10 DATED: July 23, 2014 11 12 WILLIAM Q. HAYES United States District Judge 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -7- 13cv3061-WQH-BGS

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