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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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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KRISTIANE SMITH,

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vs.

CASE NO. 13cv3061-WQH
(BGS)
Plaintiff,

ORDER

LAW OFFICES OF PATENAUDE &
FELIX, A.P.C.,
Defendant.

16 HAYES, Judge:
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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).
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BACKGROUND
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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).
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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).
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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.
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DISCUSSION

13 I.

Request for Judicial Notice

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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

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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
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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.
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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

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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).
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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

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A.

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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.
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“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,
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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).
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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.
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B.

FDCPA

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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
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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).
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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

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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.”).
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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
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WILLIAM Q. HAYES
United States District Judge

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