SANON-LAUREDANT v. LTD FINANCIAL SERVICES, L.P. et al
MEMORANDUM OPINION. Signed by Judge Kevin McNulty on 6/22/2016. (nr, )
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
Civ. No. 15-6529 (KM)
LTD FINANCIAL SERVICES, L.P.; and
JOHN DOES 1-25,
KEVIN MCNULTY, U.S.D.J.:
This is a putative class action brought pursuant to the Fair Debt
Collection Practices Act (“FDCPA”), 15 U.S.C.
§ 1692 et seq. The plaintiff,
Lloydie Sanon-Lauredant alleges that defendant LTD Financial Services, L.P.
(“LTD”) attempted to collect payment from her on a time-barred debt in a
manner that violated the FDCPA. The FDCPA prohibits a debt collector from
making a “false, deceptive, or misleading representation” or using “unfair and
unconscionable means” in the course of collecting a debt. 15 U.S.C.
Before the Court is defendant LTD’s motion for judgment on the
pleadings under FED. R. Civ. P. 12(c). (ECF no. 5) For the reasons discussed
below, I will grant the motion without prejudice to the filing of an amended
For purposes of this motion, I accept plaintiff’s allegations as true.
Sometime before February 2011, plaintiff Sanon-Lauredant incurred a financial
obligation to Chase Bank. Sanon-Lauredant alleges that she made her last
payment to Chase sometime around February 2011, and that thereafter, the
obligation went into default. Sometime after February 2011, Chase transferred
the debt to LTD for collection. (See ECF no. 1 (“Cplt.”)
Sanon-Lauredant alleges that she received two collection letters from
LTD that violated the FDCPA. The letters are dated January 12, 2015 and
March 3, 2015, and they are similar in structure and content. (See ECF no. 12) Both letters extend a “settlement offer,” which will “satisfy the debt with the
current creditor.” The letters offer three “payment plan” options. The January
letter states that the balance on the debt is $2,281.15. However, it says that
Sanon-Lauredant can make a single payment of $729.97 and thereby “save”
$1,551.18. In the alternative, Sanon-Lauredant may opt to make 6 payments of
$140.68 for a savings of $1,437.07, or she can make 12 payments of $79.84 for
a savings of $1,323.07. The March letter contains different dollar amounts, but
otherwise tracks the January letter.
According to the complaint, these letters violate the FDCPA because they
do not tell Sanon-Lauredant (1) that the statute of limitations has run on the
debt, making it unenforceable in court, and (2) that making a partial payment
could restart the statute of limitations and potentially allow LTD to sue Sanon
Lauredant for the full amount of the debt.’ (See Cplt.
IL LEGAL STANDARD
A motion for judgment on the pleadings pursuant to Rule 12(c) is often
indistinguishable from a motion to dismiss, except that it is made after the
filing of a responsive pleading. Federal Rule of Civil Procedure 12(h)(2)
“provides that a defense of failure to state a claim upon which relief can be
granted may also be made by a motion for judgment on the pleadings.” Thrbe v.
Gov’t of Virgin Islands, 938 F.2d 427, 428 (3d Cir. 1991). Accordingly, when a
Rule 12(c) motion asserts that the complaint fails to state a claim, the familiar
“ule 12(b)(6) standard applies. Id.
LTD disputes that the statute of limitations would be reset by a partial
payment. (See ECF no. 5-1 p. 12 n.3) I do not reach this issue.
LTD filed an answer to the complaint on September 29, 2015. (ECF no. 3)
Rule 12(b)(6) provides for the dismissal of a complaint, in whole or in
part, if it fails to state a claim upon which relief can be granted. The defendant,
as the moving party, bears the burden of showing that no claim has been
stated. Hedges v. United States, 404 F.3d 744, 750 (3d Cir. 2005). In deciding a
Rule 12(b)(6) motion, a court must take the allegations of the complaint as true
and draw reasonable inferences in the light most favorable to the plaintiff.
Phillips v. County of Allegheny, 515 F.3d 224, 231 (3d Cir. 2008) (traditional
“reasonable inferences” principle not undermined by Twombly, see infra). A
court may, however, “disregard any legal conclusions.” Fowler v. UPMC
Shadyside, 578 F.3d 203, 210 (3d Cir. 2009).
Federal Rule of Civil Procedure 8(a) does not require that a complaint
contain detailed factual allegations. Nevertheless, “a plaintiff’s obligation to
provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will
not do.” Bell Ati. Corp. v. Twombly, 550 U.S. 544, 555 (2007). Thus, the
complaint’s factual allegations must be sufficient to raise a plaintiff’s right to
relief above a speculative level, so that a claim is “plausible on its face.” Id. at
570; see also Umland v. PLANCO Fin. Serv., Inc., 542 F.3d 59, 64 (3d Cir. 2008).
That facial-plausibility standard is met “when the plaintiff pleads factual
content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (citing Twombly, 550 U.S. at 556). While “[tjhe plausibility standard
is not akin to a ‘probability requirement’.
it asks for more than a sheer
possibility.” Iqbal, 556 U.S. at 678.
The complaint is deficient in two respects. I will therefore grant the
motion for judgment on the pleadings, but without prejudice to the filing of an
amended complaint that remedies those shortcomings.
First, plaintiff has not sufficiently pled that the debt in this case is
governed by the FDCPA. The FDCPA, by its terms, applies only to practices
aimed at collecting a “debt,” a defined term. Zimmerman v. HBO Affiliate Grp.,
834 F.2d 1163, 1167 (3d Cir. 1987). Section 1692(a)(5) defines a “debt” thus:
[Amy obligation or alleged obligation of a consumer to pay money
arising out of a transaction in which the money, property,
insurance, or services which are the subject of the transaction are
primarily for personal, family, or household purposes.
To establish this threshold element of her FDCPA claim, plaintiff has
merely repeated the language of the statute: “The alleged CHASE obligation
arose out of a transaction in which money, property, insurance or services,
which are the subject of the transaction, were primarily for personal, family or
household purposes.” (Cplt.
29) This allegation, unsupported by any facts, is
a legal conclusion that does not satisfy the pleading requirements of Rule 8.
See Vaquero v. Frederick J. Hanna & Assocs., P.C., No. 13-64 1, 2013 WL
5947011, at *2 (D.N.J. Nov. 6, 2013)(finding nearly identical allegations
insufficient to withstand a motion to dismiss) (citing Vargas v. Frederick J.
Hanna &Assoc., No. 12-3802, slip op. at 3-4 (D.N.J. Feb. 14, 2013)); Johns v.
Northland Group, Inc., 76 F.Supp.3d 590, 598 (D.N.J. 2014)(allegation that
defendant attempted to collect “a consumer debt” was inadequate) (citing
Vaquero); see also Nicholas v. CMRE Fin. Servs., Inc., No. 08—4857, 2009 WL
1652275, at *2 (D.N.J. June 11, 2009) (“By limiting itself to the language of the
statutes and failing to provide any facts specific to [plaintiffJ, the Complaint, as
currently constituted, cannot meet the requirements of Rule 8(a)(2), Iqbal and
Phillips, and this Court grants Defendant motion with respect to Plaintiffs
Second, the complaint fails to allege facts supporting the contention that
the debt at issue is time-barred. The FDCPA claims are premised on the statute
of limitations having passed; it is for this very reason that the communications
Sanon-Lauredant received from defendants are alleged to be deceptive and
misleading. (See Cplt.
12, 32-4 1 (alleging that plaintiff’s debt is “time
barred” and that defendants failed to inform her that the statute of limitations
had run and could reset anew if she made a partial payment)) Therefore, if the
statute of limitations has not in fact run, such a flaw would be fatal to the
The complaint repeatedly alleges that the debt in this case was timebarred. (See e.g., Cplt.
¶J 12, 32-4 1) It also states that “[t]he applicable statute
of limitations related to the CHASE obligation is three (3) years or less,” without
actually identifring the statute of limitations that applies. (Cplt.
¶ 36) These
statements are mere legal conclusions that are not entitled to deference at the
pleading stage. See e.g., Johns, 76 F. Supp. 3d at 596 (“Plaintiff has not set
forth in her Complaint sufficient information to show how the debt was timebarred. The starting and ending date of the statute of limitations are not
alleged, and Plaintiff’s claim that the debt is time-barred is a mere legal
conclusion that the Court will disregard.”); Clark v. Unfund CCR Partners, No.
07-266, 2007 WL 1258113, at *4 (W.D. Pa. April 30, 2007)(plaintiff’s allegation
that the debt was barred by the statute of limitations, without more, was “a
vague legal conclusion” that was “legally insufficient under the FDCPA”).
Moreover, LTD offers good reason to doubt that this conclusory allegation
is in fact accurate. Defendant points out that under New Jersey law, a
contractual debt is governed by a six-year statute of limitations. See N.J. Stat.
§ 2A: 14-1 (“Every action at law for
recovery upon a contractual claim or
shall be commenced within 6 years next after the cause of any such
action shall have accrued.”); Huertas v. Galaxy Asset Management, 641 F.3d
28, 31 n.2 (3d Cir. 2011) (noting “New Jersey’s six-year statute of limitations”)
(citing N.J. Stat. Ann.
§ 2A: 14-1). LTD points out that if a six-year limitations
period ran from the alleged default date of February 2011, it would not expire
until 2017. (ECF no. 5-1 p. 12 & n.1-2) Sanon-Lauredant has not responded to
this argument, or even attempted to identify which state’s statute of limitations
Sanon-Lauredant has not addressed LTD’s argument that the claim accrued in
November 2011. (See ECF no. 5-1 p. 12 & nfl. 1-2) For purposes of this motion, I
accept Sanon-Lauredants allegations regarding date of accrual. (See Cplt. ¶J 17-18)
she relies upon. She may have cogent arguments to make, but she has not
made them, and I will not resort to guesswork.
In addition to these pleading deficiencies, LTD contends that there is a
larger, more substantive issue with plaintiff’s claims. The FDCPA claims, says
defendant, are not even viable in light of the Third Circuit’s decision in
Huertas, 641 F.3d 28. In that case, the Third Circuit found that an attempt to
collect on a time-barred debt did not violate the FDCPA where the
communication did not threaten litigation. Huertas, 641 F.3d at 33-34. For
now, I set aside that issue of law. As a threshold matter, plaintiff must
demonstrate that she can sufficiently allege the basic elements of her claim.
For the foregoing reasons, I will grant defendant’s motion for judgment
on the pleadings without prejudice to the filing of an amended complaint within
30 days. (ECF no. 5) An appropriate order is filed with this opinion.
Dated: June 22, 2016
Newark, New Jersey
United States District Judge
I note, though, that New Jersey’s statute may be intended, since the Complaint
alleges, at least for venue purposes, that “the acts and transactions that give rise to
this action occurred, in substantial part” in New Jersey. (Cplt. ¶ 3)
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