Mkhitaryan et al v. US Bancorp et al

Filing 25

ORDER Granting 13 US Bank's Motion to Dismiss. Signed by Judge James C. Mahan on 10/5/11. (Copies have been distributed pursuant to the NEF - EDS)

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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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SERGEY MKHITARYAN and SUREN
MKHITARYAN,

2:11-CV-1055 JCM (CWH)

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Plaintiffs,

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v.

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U.S. BANCORP, et al.,

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Defendants.

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ORDER

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Presently before the court is defendant U.S. Bank’s motion to dismiss the plaintiffs’ Fair

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Debt Collection Practices Act (“FDCPA”) claim. (Doc. #13). The plaintiffs Sergey Mkhitaryan

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(“Sergey”) and Suren Mkhitaryan (“Suren”) have responded (doc. #21), and the defendant has

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replied (doc. #22).

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The instant dispute stems from the repossession of Sergey’s vehicle by co-defendant Speedy

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Recovery, Inc. (“Speedy”). The repossession agent allegedly trespassed and terrorized the plaintiffs

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with his baseball bat in order to repossess the vehicle. (Complaint ¶ 26 through ¶ 32). Plaintiffs

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allege one federal claim against defendants for violation of the FDCPA. The plaintiffs’ state law

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claims for relief against the defendants include: (1) negligent hiring, (2) assault, (3) intentional

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infliction of emotional distress, and (4) negligent infliction of emotional distress.

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...

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...

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James C. Mahan
U.S. District Judge

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DISCUSSION

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Defendant U.S. Bank’s present motion to dismiss (doc. # 13) asserts that the claim for

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violation of the FDCPA should be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6)

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for failure to state a claim for which relief can be granted.

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Under Federal Rule of Civil Procedure 12(b)(6), dismissal is proper when a complaint fails

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to state a claim upon which relief can be granted. In order for a plaintiff to survive a 12(b)(6) motion,

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he must “provide the grounds for [] entitlement to relief [which] requires more than labels and

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conclusions. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 547 (2007). Under rule 8(a)(2), a

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complaint must contain a “short and plain statement of the claim showing that the pleader is entitled

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to relief,” and must be more than “an unadorned, the defendant-unlawfully-harmed-me accusation.”

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See Fed. R. Civ. P. 8(a)(2); Ashcroft v. Iqbal, 129 S.Ct 1937, 173 L.Ed.2d 868 (2009), quoting

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Twombly at 555.

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The FDCPA is intended to eliminate abusive debt collection practices by debt collectors

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and to insure that those debt collectors who refrain from using abusive debt collection practices

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are not competitively disadvantaged, and to promote consistent state action to protect consumers

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against debt collection abuses. 15 U.S.C. 1592(e). A claim under this act requires the plaintiff to

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demonstrate that (1) the defendant is a “debt collector”; (2) the plaintiff is the object of collection

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activity from a consumer debt; and (3) the defendant engaged in some act or omission

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specifically prohibited by the act. Dikun v. Streich, 369 F. Supp. 2d 781, 184-85 (E.D. Va. 2005).

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Here, plaintiffs’ fail to meet the first element.

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The debt collection act imposes liability only on “debt collectors,” that is “any person

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who uses instrumentality of interstate commerce or the mails in any business the principal

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purpose of which is the collection of any debt, or who regularly collects or attempts to collect,

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directly or indirectly, debts owed or due or asserted to be owed or due another.” 15 U.S.C. §

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1692a(6). However, the statute’s definition of “debt collector” excludes a person who collects a

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debt “to the extent that such activity...(ii) concerns a debt which was originated by such person,”

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and excludes a person who collects debt that “concerns a debt obtained by such person as a

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James C. Mahan
U.S. District Judge

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secured party in a commercial credit transaction involving the creditor.” § 1692(F).

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Furthermore, the FDCPA definition of “debt collector” does not include the consumer’s

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creditors. Perry v. Stewart Title Co., 756 F.2d 1197, 1208 (5th Cir. 1985). The FDCPA defines

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“creditor” as “any person who offers or extends credit creating a debt or to whom a debt is

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owed.Ӥ 1692(a)(4). U.S. Bank is the original creditor under the FDCPA, as it financed the

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purchase of Sergey’s vehicle.

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Plaintiffs allege that, although “creditors” are not “debt collectors” under the act, there are

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several factual situations in which “creditors” are liable as “debt collectors.” However, none of

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the authorities cited to in the plaintiffs’ opposition (doc. #21), relate to the facts alleged in the

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complaint.
In conclusion, the FDCPA does not apply to U.S. Bank because the bank is not a “debt

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collector” as defined by the FDCPA and similar statutes. Kenneweg v. IndyMac Bank, FSB, 2011

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WL 13853, *2 (D. Nev. Jan. 4, 2011) (holding the FDCPA inapplicable where defendants are not

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debt collectors as defined in the statute). Thus, the motion to dismiss is granted as to this claim

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for relief.

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Accordingly,

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IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that defendant U.S. Bank’s

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motion to dismiss (doc. #5) be, and the same hereby is, GRANTED.
(#13)
DATED October 5, 2011.

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UNITED STATES DISTRICT JUDGE
NITED STATES
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JUD
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James C. Mahan
U.S. District Judge

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