Shaut v. Department of Health and Human Services

Filing 9

ORDER: as to Anna M. Shaut. It is Ordered that copies of the documents annexed to plaintiffs # 1 original complaint at page numbers 5-8 and 11-16, as designated by the CM/ECF system, be added to the end of Plaintiffs # 8 amended complaint and tha t the amended complaint with those documents annexed be designated as Plaintiffs operative pleading in the action. The Clerk shall issue summonses and forward them, along wth copies of the operative Amended Complaint and packets of General Order 25 to the United States Marshal Service for service of process as noted herein. The Clerk has provided Plaintiff with a copy of the unpublished decision in Wilson v. Gordon & Wong Law Group, P.C., 2013 WL 6858975 (E.D. Cal. Dec. 24, 2013) in accordance with LeBron v. Sanders, 557 F.3d 76 (2d Cir. 2009) (per curiam) - attached to this Order. The Clerk is directed to revise the Civil Docket to identify the Secretary of the Department of Health and Human Services as Defendant. The Clerk has served a c opy of this Order and General Order 25 on Plaintiff. Parties directed to file a Certificate of Service with all filings in this matter. Signed by Magistrate Judge Therese Wiley Dancks on 12/22/2014. {Copy sent to pro se plaintiff by regular mail} (jmb)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
_____________________________________________
ANNA M. SHAUT,
Plaintiff,
6:14-CV-0910
(TJM/TWD)

v.
SECRETARY OF THE DEPARTMENT OF HEALTH
AND HUMAN SERVICES,
Defendant.
_____________________________________________
APPEARANCES:
ANNA M. SHAUT
Plaintiff pro se
13 Ferris Avenue
Utica, New York 13501

THÉRÈSE WILEY DANCKS, United States Magistrate Judge
ORDER
On July 23, 2014, pro se Plaintiff Anna M. Shaut filed a complaint against the United
States Department of Health and Human Services (“HHS”) seeking judicial review, pursuant to
42 U.S.C. § 1395ff(b), of a May 22, 2014, decision of the Medicare Appeals Council (“Appeals
Council”). (Dkt. No. 1.) The complaint and Plaintiff’s second application to proceed in forma
pauperis were sent to the Court for review.1 (Dkt. Nos. 1 and 2.) The Court granted Plaintiff’s
second application to proceed in forma pauperis in an Order dated October 28, 2014. (Dkt. No.
7.) However, the Court concluded that there was an impediment to going forward with the initial

1

Plaintiff’s initial application to proceed in forma pauperis (Dkt. No. 2) was denied
without prejudice. (Dkt. No. 4.)

review of the Complaint pursuant to 28 U.S.C. § 1915(e). Id. at 2-3.
The Appeals Council’s decision on which review is sought by Plaintiff affirmed the
determination of an administrative law judge (“ALJ”), who had upheld a demand by Medicare on
Plaintiff’s mother, Medicare beneficiary, Lydia Grzesiak (“Grzesiak”), for repayment of a
$29,196.92 Medicare lien. (Dkt. No. 1 at 3, 11-16.) Grzesiak had made the repayment, and she
was found to have made no showing that she was entitled to a waiver of recovery under Section
1870(c) of the Social Security Act. Id. at 15.
Plaintiff pursued the appeal to the Appeals Council on behalf of Grzesiak. Id. at 12. The
sole allegation in Plaintiff’s Complaint, to which the Notice of Decision of Medicare Appeals
Council and Decision are attached, was “We want to be reimbursed the money that was paid to
Medicare by my mother.” Id. at 3. The Complaint did not identify the person or persons
constituting “we.” Id. However, the Court took judicial notice of Grzesiak’s obituary, indicating
that she died on November 22, 2012, and was survived by a number of children, including
Plaintiff.2 (Dkt. No. 7 at 3 n.2.)
Although Plaintiff has the right to act as her counsel, see 28 U.S.C. § 1654 (1982), “[a]
person who has not been admitted to the practice of law may not represent anyone other than
[herself].” Guest v. Hansen, 603 F.3d 15, 20 (2d Cir. 2010). Even if Plaintiff had sued as
administrator or executor of her mother’s estate, she could not have proceeded pro se if the estate
2

See www.eannacefuneralhome.com/obituaries/Lydia-Grzesiak/LydiaGrzesiak/#!/Obituary (most recent visit December 18, 2014); see also Wilson v. Gordon & Wong
Law Group, P.C., No. 2:13-cv-00609-MCE-KJN, 2013 WL 6858975, 2013 U.S. Dist. LEXIS
180366, at *11-12 (E.D. Cal. Dec. 24, 2013) (taking judicial notice of an obituary appearing in a
newspaper); Magnoni v. Smith & Laquericia, LLP, 701 F. Supp. 2d 497, 501 (S.D.N.Y. 2010)
(court generally has discretion to take judicial notice of internet materials), aff’d, 483 F. App’x
613 (2d Cir. 2012).
2

has beneficiaries or creditors other than her. See Pridgen v. Andresen, 113 F.3d 391, 393 (2d Cir.
1997). In Guest, the Second Circuit held that the administrator and sole beneficiary of an estate
with no creditors may appear pro se on behalf of the estate. Id. at 21. Plaintiff did not sue as
administrator or executor of Grzesiak’s estate in her initial Complaint, nor did she allege that she
is the sole beneficiary of her mother’s estate and that there are no creditors. To the contrary,
Plaintiff alleged that she was pursuing her late mother’s Medicare claim, which presumably
would be a part of her mother’s estate, not only on her own behalf, but on behalf of others as
well. (Dkt. No. 1 at 3.)
The Court concluded that based upon the allegations in her initial complaint and
Grzesiak’s obituary, Plaintiff would have to retain counsel to pursue the claim, thus leaving the
Court unable to undertake its initial review. The Court ordered that the action be stayed for
ninety days to give Plaintiff time to retain counsel or submit an amended complaint alleging that
she is the administrator or executor of her mother’s estate, that she is proceeding only on her own
as the sole beneficiary, and that her mother’s estate has no creditors. (Dkt. No. 7 at 4.) The
Court noted in its Order that if there was no appearance by counsel and no amended complaint
filed on or before January 26, 2015, it would issue a Report-Recommendation recommending
that the complaint be dismissed without prejudice. Id.
Plaintiff filed an amended complaint on November 17, 2014.3 (Dkt. No. 8.) In her
3

In its October 28, 2014, Order (Dkt. No. 7), the Court noted that Plaintiff had
mistakenly filed a form pro se complaint for use in an action under 42 U.S.C. § 1983 (Dkt. No.
1) but excused the error in light of Plaintiff’s pro se status. Plaintiff has utilized the same 42
U.S.C. § 1983 form for her Amended Complaint, and the Court again excuses the error. In its
October 28, 2014, Order, the Court also noted that Plaintiff had mistakenly named the
Department of Health and Human Services rather than the Secretary of the Department of Health
and Human Services as Defendant. See 42 C.F.R. § 405.1136(d). Plaintiff has corrected the
3

amended complaint, Plaintiff has alleged that she has been working on being reimbursed the
money her mother paid medicare out of her settlement from her lawsuit, and she did not hire
legal counsel because her personal funds were used to assist her mother after the lawsuit. (Id. at
¶¶ 1 and 5.) In a November 12, 2014, letter to the Court submitted with the amended complaint,
Plaintiff explained that the “we” in her original complaint was her mother and siblings. (Dkt.
No. 8-1.) However, according to Plaintiff, she was her mother’s “beneficiary for her social
security checks, health care proxy, and caregiver responsible for her financial responsibly (sic).”
Id. Plaintiff also stated in the letter that “[t]here was no administrator or executor of her estate
because she did not have an estate,” and that “[s]he did not have creditors or beneficiaries.” Id.
After reviewing the amended complaint (Dkt. No. 8), the Court finds that it states a claim
for judicial review of the Appeals Council decision sufficient to survive initial review under 28
U.S.C. § 1915(e) (2006), and that Plaintiff may proceed pro se solely with respect to her own
interest, if any, in the return of the repayment.4 Accordingly, Defendant should be directed to
respond to the amended complaint. The Court expresses no opinion regarding whether Plaintiff
has standing to pursue judicial review pursuant to 42 U.S.C. § 1395ff(b), or whether Plaintiff’s

error and named the Secretary of the Department of Health and Human Services as Defendant in
her Amended Complaint. (Dkt. No. 8.)
4

Plaintiff annexed the following documents to her original complaint: (1) July 7, 2014,
Notice of Action of Medicare Appeals Council Denying Request to Reopen; (2) Action of
Medicare Appeals Council on Request for Review; (3) May 22, 2014, Notice of Decision of
Medicare Appeals Council; (4) Procedural History; and (5) May 22, 2014, Decision of Medicare
Appeals Council. (Dkt. No. 1 at 5-8, 11-16.) Plaintiff neglected to annex the documents to her
amended complaint. (Dkt. No. 8.) Therefore, the Court will order that copies of those pages of
plaintiff’s original complaint (Dkt. No. 1) designated by the CM/ECF system as pages 5-8 and
11-16 be added to the end of Plaintiff’s amended complaint, and that the amended complaint
with the additional documents annexed thereto constitute the operative pleading in the case.
4

claim can withstand a properly filed motion to dismiss or for summary judgment

only that it

should survive this initial screening.
ACCORDINGLY, it is hereby
ORDERED that copies of the documents annexed to plaintiff’s original complaint (Dkt.
No. 1) at page numbers 5-8 and 11-16, as designated by the CM/ECF system, be added to the end
of Plaintiff’s amended complaint (Dkt. No. 8), and that the amended complaint with those
documents annexed be designated as Plaintiff’s amended complaint and filed as the operative
pleading in the action; and it is further
ORDERED, that the Clerk shall issue summonses and forward them, along with copies
of the amended complaint designated by the Court as the operative pleading and packets
containing General Order 25, which sets forth the Civil Case Management Plan used by the
Northern District of New York, to the United States Marshal for service: (1) on the Secretary of
Health and Human Services by registered or certified mail to the General Counsel, Department of
Health and Human Services, 200 Independence Avenue, S.W., Washington, D.C. 20201; (2) on
the Attorney General of the United States by registered or certified mail at U.S. Department of
Justice, 950 Pennsylvania Avenue, NW, Washington, DC 20530-0001; and (3) on the United
States Attorney for the Northern District of New York, by delivery to the United States Attorney
or an assistant United States Attorney or clerical employee whom the United States attorney has
designated in a writing filed with the court; and it is further
ORDERED that a formal response to Plaintiff's amended complaint be filed by
Defendant as provided for in the Federal Rules of Civil Procedure subsequent to service of
process on Defendant; and it is further
5

ORDERED that the Clerk provide Plaintiff with a copy of the unpublished decision in
Wilson v. Gordon & Wong Law Group, P.C., 2013 WL 6858975 (E.D. Cal. Dec. 24, 2013)
in accordance with LeBron v. Sanders, 557 F.3d 76 (2d Cir. 2009) (per curiam); and it is further
ORDERED that the Clerk revise the Civil Docket to identify the Secretary of the
Department of Health and Human Services as Defendant; and it is further
ORDERED that the Clerk serve a copy of this Order and General Order 25 on Plaintiff;
and it is further
ORDERED that any paper sent by a party to the Court or the Clerk shall be accompanied
by a certificate setting forth the date a true and correct copy of it was mailed to all opposing
parties or their counsel. Any letter or other document received by the Clerk or the Court
which does not include a certificate of service which clearly states that an identical copy
was served upon all opposing parties or their attorneys is to be returned, without
processing, by the Clerk. Plaintiff shall also comply with any requests by the Clerk's Office for
any documents that are necessary to maintain this action. All motions shall comply with the
Local Rules of Practice of the Northern District.

Dated: December 22, 2014
Syracuse, New York

6

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Only the Westlaw citation is currently available.
United States District Court,
E.D. California.
Velma WILSON and Barbara Portal, Plaintiffs,
v.
GORDON & WONG LAW GROUP, P.C., and Does
1 through 100, inclusive, Defendants.
No. 2:13–cv–00609–MCE–KJN.
Dec. 24, 2013.
Gregory Mark Fitzgerald, Seideman Law Firm, PC,
Miruna Mihai, The Palmer Firm, P.C., William James
Campbell, Seideman Law Firm, P.C, Rancho
Cucamonga, CA, for Plaintiffs.
Tomio B. Narita, Christopher Manion Spain, Simmonds & Narita LLP, San Francisco, CA, for Defendants.
MEMORANDUM AND ORDER
MORRISON C. ENGLAND, JR., Chief Judge.
*1 Through this action, Plaintiffs Velma Wilson
and Barbara Portal (“Plaintiffs”) seek to recover from
Defendant Gordon & Wong Law Group, P.C. (“Defendant”), for violations of the Rosenthal Fair Debt
Collection Practices Act, Cal. Civ.Code § 1788 et seq.,
violations of the Fair Debt Collection Practices Act
(“FDCPA”), 15 U.S.C. § 1692 et seq., and fraud. The
gravamen of Plaintiffs' complaint is that Defendant
improperly attempted to collect on a debt owed by
Plaintiffs, and then fraudulently purported to negotiate
a settlement of that debt. Compl., Oct. 11, 2013, ECF
No. 25.
Presently before the Court is Defendant's Motion

to Dismiss (“Motion”) Plaintiff's Second Amended
Complaint for failure to state a claim upon which
relief can be granted, pursuant to Federal Rule of Civil
Procedure 12(b)(6) FN1, and for sanctions. Mot., Oct.
25, 2013, ECF No. 26. For the reasons set forth below,
Defendant's Motion is granted in part and denied in
part. FN2
FN1. All further references to “Rule” or
“Rules” are to the Federal Rules of Civil
Procedure unless otherwise stated.
FN2. Because oral argument would not be of
material assistance, the Court ordered this
matter submitted on the briefs. E.D. Cal.
Local R. 230(g).
BACKGROUNDFN3
FN3. The following recitation of facts is
taken, sometimes verbatim, from Plaintiffs'
Second Amended Complaint. ECF No. 25.
“Sometime during or prior to 2012,” Plaintiffs
established an account with HSBC (“the account”).
Plaintiffs incurred financial obligations on this account, on which they later defaulted. On August 24,
2007, Plaintiffs retained the Palmer Firm, P.C. (“the
Palmer Firm”) to represent them regarding this debt,
and at some point prior to January 6, 2011, Defendant
was retained by HSBC to collect from Plaintiffs. On
January 6, 2011, the Palmer Firm sent a letter of representation to Defendant, informing Defendant that
Plaintiffs were represented by counsel regarding the
account, and instructing Defendant to cease its communications with Plaintiffs.
On January 18, 2011, Defendant called the
Palmer Firm to discuss the account. According to

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Defendant, it was willing to settle the account, on
which it claimed Plaintiffs owed $2,632.15. However,
Defendant also made additional attempts to collect
directly from Plaintiffs when, that same day, one of its
employees placed a phone call to Plaintiffs, and later,
on February 16, 2011, Defendant mailed a collection
letter to Plaintiffs.
As a result of these allegedly illegal communications with Plaintiffs, on June 21, 201, the Palmer Firm
sent a demand letter to Defendant. Thereafter, Defendant's employee, Mitchell Wong, communicated
with the Palmer Firm to attempt to settle the claim
against Defendant. From Plaintiffs' perspective,
however, Mr. Wong was merely trying “to make it
look like Defendants wanted to resolve the issues in
the demand letter.” Compl. at 11 (emphasis added).
On July 27, 2011, Defendant's employee Andrew
Ford sent an email to Plaintiffs, agreeing to pay
Plaintiffs $1,200.00 to resolve Plaintiffs' claim.
Plaintiffs allege that Ford misled Plaintiffs by indicating Defendants would settle the demand for $1200,
because Defendants did not in fact provide any money
to Plaintiffs. Pursuant to Defendants' request, on August 4, 2011, the Palmer Firm sent a release to Defendants for execution and payment of the settlement
amounts. The Palmer Firm continuously followed up
with Defendants to get the agreed upon release signed
and the settlement paid. On January 27, 2012, Mitchell
Wong emailed the Palmer Firm, advising, “I have
been out of the office since August due to illness. I
will order the checks.” Thus, according to Plaintiffs,
weeks prior to the expiration of the statute of limitations, Defendant “tricked Plaintiff into believing that
the need to expend money to file suit was not necessary because the matter was resolved .” Compl. at 13.
However, not only did Plaintiffs never receive a
check, but Defendant also never informed Plaintiffs
there would be no settlement.
*2 On June 11, 2012, Defendant requested a
power of attorney, which Plaintiffs provided one

month later. After that, Defendant stopped communication with the Palmer Firm altogether.
Plaintiffs thereafter initiated this action in state
court. On March 29, 2013, Defendant removed the
case to federal court pursuant to this Court's federal
question jurisdiction, and filed a Motion to Dismiss
pursuant to Rule 12(b)(6). On June 19, 2013, the Court
granted Defendant's Motion to Dismiss with leave to
amend.
On July 3, 2013, Plaintiffs filed a First Amended
Complaint, which Defendant again moved to dismiss.
The Court granted Defendant's subsequent Motion to
Dismiss, and dismissed that complaint with final leave
to amend. On October 11, 2013, Plaintiffs filed the
operative Second Amended Complaint, which Defendant now moves to dismiss. Plaintiff filed a timely
opposition.
STANDARD
On a motion to dismiss for failure to state a claim
under Federal Rule of Civil Procedure 12(b)(6), all
allegations of material fact must be accepted as true
and construed in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d
336, 337–38 (9th Cir.1996). Rule 8(a)(2) requires only
“a short and plain statement of the claim showing that
the pleader is entitled to relief” in order to “give the
defendant fair notice of what the ... claim is and the
grounds upon which it rests.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167
L.Ed.2d 929 (2007) (quoting Conley v. Gibson, 355
U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). A
complaint attacked by a Rule 12(b)(6) motion to dismiss does not require detailed factual allegations.
However, “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.” Id.
(internal citations and quotations omitted). A court is
not required to accept as true a “legal conclusion
couched as a factual allegation.” Ashcroft v. Iqbal, 556

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U.S. 662, 129 S.Ct. 1937, 1950, 173 L.Ed.2d 868
(2009) (quoting Twombly, 550 U.S. at 555). “Factual
allegations must be enough to raise a right to relief
above the speculative level.” Twombly, 550 U.S. at
555 (citing 5 Charles Alan Wright & Arthur R. Miller,
Federal Practice and Procedure § 1216 (3d ed.2004)
(stating that the pleading must contain something
more than “a statement of facts that merely creates a
suspicion [of] a legally cognizable right of action.”)).
Furthermore, “Rule 8(a)(2) ... requires a showing,
rather than a blanket assertion, of entitlement to relief.” Twombly, 550 U.S. at 556 n. 3 (internal citations
and quotations omitted). Thus, “[w]ithout some factual allegation in the complaint, it is hard to see how a
claimant could satisfy the requirements of providing
not only ‘fair notice’ of the nature of the claim, but
also ‘grounds' on which the claim rests.” Id. (citing 5
Charles Alan Wright & Arthur R. Miller, supra, at §
1202). A pleading must contain “only enough facts to
state a claim to relief that is plausible on its face.” Id.
at 570. If the “plaintiffs ... have not nudged their
claims across the line from conceivable to plausible,
their complaint must be dismissed.” Id . However, “[a]
well-pleaded complaint may proceed even if it strikes
a savvy judge that actual proof of those facts is improbable, and ‘that a recovery is very remote and
unlikely.’ ” Id. at 556 (quoting Scheuer v. Rhodes, 416
U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974)).
*3 A court granting a motion to dismiss a complaint must then decide whether to grant leave to
amend. Leave to amend should be “freely given”
where there is no “undue delay, bad faith or dilatory
motive on the part of the movant, ... undue prejudice to
the opposing party by virtue of allowance of the
amendment, [or] futility of the amendment ....“ Foman
v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d
222 (1962); Eminence Capital, LLC v. Aspeon, Inc.,
316 F.3d 1048, 1052 (9th Cir.2003) (listing the Foman
factors as those to be considered when deciding
whether to grant leave to amend). Not all of these
factors merit equal weight. Rather, “the consideration

of prejudice to the opposing party ... carries the
greatest weight.” Id. (citing DCD Programs, Ltd. v.
Leighton, 833 F.2d 183, 185 (9th Cir.1987)). Dismissal without leave to amend is proper only if it is
clear that “the complaint could not be saved by any
amendment.” Intri–Plex Techs. v. Crest Group, Inc.,
499 F.3d 1048, 1056 (9th Cir.2007) (citing In re Daou
Sys., Inc., 411 F.3d 1006, 1013 (9th Cir.2005); Ascon
Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160
(9th Cir.1989) (“Leave need not be granted where the
amendment of the complaint ... constitutes an exercise
in futility ....”)).
ANALYSIS
A. Motion to Dismiss
1. Incorporation of Documents and Requests for
Judicial Notice
Plaintiffs attached numerous documents to the
Second Amended Complaint. “If documents are
physically attached to the complaint, then a court may
consider them if their ‘authenticity is not contested’
and ‘the plaintiff's complaint necessarily relies on
them .’ ” Goodwin v. Executive Tr. Servs., LLC, 680
F.Supp.2d 1244, 1250 (D.Nev.2010) (quoting Lee v.
City of Los Angeles, 250 F.3d 668, 688 (9th Cir.2001).
Plaintiffs' Second Amended Complaint relies in large
part on the communications between Plaintiffs, Defendant, and Plaintiff's counsel, and Defendant does
not contest the authenticity of these documents. Accordingly, the Court may consider the documents
attached to Plaintiff's Second Amended Complaint in
ruling on the instant Motion.
Additionally, Defendant and Plaintiffs each attach documents to the Motion, Opposition, and Reply.
“Ordinarily, a court may look only at the face of the
complaint to decide a motion to dismiss.” Van Buskirk
v. Cable News Network, Inc., 284 F.3d 977, 980 (9th
Cir.2002). Indeed, Rule 12(d) provides that “[i]f, on a
motion under Rule 12(b)(6) or 12(c), matters outside

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the pleadings are presented to and not excluded by the
court, the motion must be treated as one for summary
judgment under Rule 56. All parties must be given a
reasonable opportunity to present all the material that
is pertinent to the motion.” Fed.R.Civ.P. 12(d).
However, the Ninth Circuit has held “that documents
whose content are alleged in a complaint and whose
authenticity no party questions, but which are not
physically attached to the pleading, may be considered
in ruling on a Rule 12(b)(6) motion to dismiss.”
Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir.1994),
overruled on separate grounds by Galbraith v. County
of Santa Clara, 307 F.3d 1119 (9th Cir.2002).
*4 The document “may be incorporated by reference into a complaint if the plaintiff refers extensively to the document or the document forms the
basis of the plaintiff's claim.” United States v. Ritchie,
342 F.3d 903, 908 (9th Cir.2003). Consideration of
such documents “does ‘not convert the motion to
dismiss into a motion for summary judgment.’ ”
Branch, 14 F.3d at 454 (quoting Romani v. Shearson
Lehman Hutton, 929 F.2d 875, 879 n. 3 (9th
Cir.1991)).
Here, Defendant attaches the Declaration of
Tomio B. Narita in Support of Defendant's Motion to
Dismiss. Narita Decl., Oct. 25, 2013, ECF No. 26–1.
This document may not be considered in deciding the
Motion to Dismiss, as the Complaint does not refer to
this document at all, and consideration of such a declaration on a motion to dismiss would convert the
motion to one for summary judgment. See Ritchie, 342
F.3d at 908. This document is therefore not incorporated by reference, and will not be considered by the
Court in deciding Defendant's Motion to Dismiss.
Defendant also requests that the Court take judicial notice of an obituary for Jason C. Wilson which
was published in the Lodi News–Sentinel from October 28, 2010, through November 4, 2010. RJN, Oct.
25, 2013, ECF No. 26–2. “[Federal Rule of Evidence]
201(b) provides that judicial notice must be “one not

subject to reasonable dispute in that it is either (1)
generally known within the territorial jurisdiction of
the trial court or (2) capable of accurate and ready
determination by resort to sources whose accuracy
cannot reasonably be questioned.” Ritter v. Hughes
Aircraft Co., 58 F.3d 454, 458 (9th Cir.1995) (quoting
Fed.R.Evid. 201(b)). “[A] court may take judicial
notice of information in newspaper articles.” U.S. v.
Callum, 107 F.3d 878, *2 (9th Cir.1997) (citing Ritter,
58 F.3d at 458–59). Other district courts have taken
judicial notice that a person is deceased based on an
obituary published in a newspaper. See United States
v. Beeman, 1:10–CV–237–SJM, 2011 WL 3021789
(W.D.Pa. July 22, 2011) (“Based upon the aforementioned April 7, 1997 obituary, this Court will take
judicial notice of the fact that Defendant Howard
Beeman is, in fact, deceased.) Accordingly, the Court
takes judicial notice of Jason Wilson's obituary.
Plaintiffs also attach certain documents to their
Opposition. Opp'n at 10–21. First, Plaintiff attaches an
email from Andrew Ford to William Campbell, sent
on July 27, 2011. Id. at 11. This email is already included as part of Plaintiff's Complaint, and therefore
the Court need not incorporate it again by reference.
Next, Plaintiff attaches emails, also between Andrew
Ford to William Campbell, from August 11, 2011, and
from August 11, 2011, and August 24, 2011. Id. at 13,
21. None of these emails are referenced at all in the
Complaint, let alone referenced “extensively.” Ritchie, 342 F.3d at 908. Accordingly, these emails may not
be incorporated by reference.
*5 Finally, Plaintiff includes a “Settlement
Agreement and General Release” between Plaintiff
Velma Wilson and Defendant. Opp'n at 15–19. This
Settlement Agreement is signed and dated August 22,
2011. Defendant also attaches to its Reply a “Settlement Agreement and General Release” between Jason
C. Wilson and Defendant. Reply Ex. A, Dec. 12, 2013,
ECF No. 28. Plaintiffs' Complaint references “releases” sent to Defendant on August 4, 2011, and
attached to the Complaint is an email from William

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Campbell to Andrew Ford, stating “I have attached
releases for your review ....“ Compl. at 47. Additionally, the emails attached to the Complaint, including
the email regarding releases sent on August 4, 2011,
contain the subject line: “In re: Jason and Velma
Wilson.” Given these references to the releases in the
Complaint and documents attached thereto, the Court
finds that the documents titled “Settlement Agreement
and General Release” submitted by both Plaintiff and
Defendant have been incorporated by reference into
the Complaint.
2. FDCPA Statute of Limitations
Defendant takes issue with Plaintiffs' FDCPA
claim on statute of limitations grounds. The FDCPA
states “[a]n action to enforce any liability ... may be
brought ... within one year from that date on which the
violation occurs.” 15 U.S.C. § 1692k(d). “Under Ninth
Circuit precedent, the FDCPA limitations period ‘begins to run when the plaintiff knows or has reason to
know of the injury which is the basis of the action.’ ”
Huy Thanh Vo v. Nelson & Kennard, No. CIV.
5–12–2537 LKK/CKD, 2013 WL 1091207, at *3
(E.D.Cal. Mar.15, 2013) (quoting Mangum v. Action
Collection Serv., Inc., 575 F.3d 935, 940 (9th
Cir.2009)).
As stated in the Court's prior orders, the correspondence allegedly violating the FDCPA was sent on
February 16, 2011, and thus Plaintiffs knew of the
injury providing the basis for their FDCPA claim on
that date. The statute of limitations for this claim
therefore expired on February 16, 2012. However,
Plaintiffs did not file the instant lawsuit until February
13, 2013. Defendant again argues that, as a result,
Plaintiffs' FDCPA claim is time barred and therefore
fails as a matter of law. Plaintiffs again contend that
equitable tolling applies because Defendant tricked
Plaintiffs into letting the statute of limitations expire
by telling Plaintiffs that the case was settled when
Defendant had no real intention of settling.
The Ninth Circuit has held that equitable tolling is

applicable to the FDCPA. Mangum, 575 F.3d at
939–40. Equitable tolling is extended “only sparingly”
by the courts, and it is generally awarded in two situations: (1) “where the claimant has actively pursued
his judicial remedies by filing a defective pleading
during the statutory period,” or (2) “where the complainant has been induced or tricked by his adversary's
misconduct into allowing the filing deadline to pass.”
Irwin v. Dep't of Veterans Affairs, 498 U.S. 89, 96,
111 S.Ct. 453, 112 L.Ed.2d 435 (1990). Although
Plaintiffs have alleged additional facts in an attempt to
show that Defendants “tricked” Plaintiffs into letting
the deadline expire, the Court again finds equitable
tolling unwarranted in this case.
*6 As set forth in the Court's prior orders, courts
are hesitant to apply equitable tolling in situations in
which the plaintiff has the information necessary for
the filing of a claim and does not do so as a result of
ongoing negotiations with the defendant. See Souphalith v. Astrue, No. 06–CV–01410–H (AJB), 2009
WL 35471 (S.D.Cal. Jan.5, 2009) (narrowly applying
equitable tolling solely on the basis of defendant's past
waiver of the timeliness requirement after settlement
negotiations); Hawaii v. United States, 173 F.Supp.2d
1063 (D.Haw.2000) (holding equitable tolling inapplicable as defendant's intent to engage in settlement
negotiations is not a reasonable justification for
plaintiff's delay in bringing suit). Here, although Defendant represented in email communications on July
27, 2011, that the case was settled, and Plaintiffs sent
releases to Defendant on August 4, 2011, Defendant
never signed the releases and Plaintiff Velma Wilson
never received a settlement check. Plaintiffs apparently waited nearly six months without hearing from
Defendants regarding the supposed settlement, and yet
allowed the deadline to file their instant claims pass.
Under these circumstances, Plaintiffs' continued reliance on Defendant's representations of settlement, as
well as Plaintiffs' counsel's failure to file action to
protect their clients' interests, is unreasonable. Rather
than suggesting that Defendant “tricked” Plaintiffs,
these facts indicate that Plaintiffs' counsel acted na-

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ively, and even foolishly, by allowing the filing deadline to pass.
Accordingly, the Court finds that equitable tolling
is not applicable in this case, and Defendant's Motion
is granted with respect to Plaintiffs' FDCPA claim.
3. State Law Causes of Action
Pursuant to 28 U.S.C. § 1367(c)(3), if a federal
district court has dismissed all claims over which it
has original jurisdiction, it may, in its discretion,
dismiss without prejudice supplemental state law
claims brought in the same action. 28 U.S.C. §
1367(c)(3); see Acri v. Varian Assocs., Inc., 114 F.3d
999, 1001 (9th Cir.1997) (en banc).
Several factors are considered in determining
whether the Court should exercise jurisdiction over
the state law claims. These factors include economy,
convenience, fairness, and comity in deciding whether
to retain jurisdiction over pendent state claims.
Imagineering, Inc. v. Kiewit Pac. Co., 976 F.2d 1303,
1309 (9th Cir.1992) (citing Carnegie–Mellon Univ. v.
Cohill, 484 U.S. 343, 353, 108 S.Ct. 614, 98 L.Ed.2d
720 (1988)). Although the court is not required to
dismiss the supplemental state law claims, “in the
usual case in which all federal-law claims are eliminated before trial, the balance of factors ... will point
toward declining to exercise jurisdiction over the
remaining state-law claims.” Carnegie—Mellon
Univ., 484 U.S. at 350 n. 7; see also Schneider v. TRW,
Inc., 938 F.2d 986, 993–94 (9th Cir.1991).
Here, the Carnegie–Mellon factors weigh in favor
of remand. Only state law claims remain, and the case
has yet to proceed to trial. Judicial economy does not
favor continuing to exercise supplemental jurisdiction.
Nor do the comity and fairness factors weigh in favor
of exercising supplemental jurisdiction since
“[n]eedless decisions of state law should be avoided
both as a matter of comity and to promote justice
between the parties, by procuring for them a sur-

er-footed reading of applicable law.” United Mine
Workers of Am. v. Gibbs, 383 U.S. 715, 726, 86 S.Ct.
1130, 16 L.Ed.2d 218 (1966).
*7 Plaintiff's state law claims are therefore dismissed without prejudice under 28 U.S.C. § 1367(c).
B. Request for Sanctions
The Supreme Court has “reinforced the
longstanding principle that courts of justice are universally acknowledged to be vested, by their very
creation, with power to impose silence, respect, and
decorum, in their presence, and submission to their
lawful mandates.” B.K.B. v. Maui Police Dep't, 276
F.3d 1091, 1107–08 (9th Cir.2002) (quoting Chambers v. NASCO, Inc., 501 U.S. 32, 43, 111 S.Ct. 2123,
115 L.Ed.2d 27 (1991)) (internal quotation marks
omitted). “Significantly, under [the Ninth Circuit's]
controlling cases, conduct that is ‘tantamount to bad
faith’ is sanctionable.” Id. (citing Roadway Express,
Inc. v. Piper, 447 U.S. 752, 767, 100 S.Ct. 2455, 65
L.Ed.2d 488 (1980)). “In sum, ‘sanctions are available
if the court specifically finds bad faith or conduct
tantamount to bad faith. Sanctions are available for a
variety of types of willful actions, including recklessness when combined with an additional factor
such as frivolousness, harassment, or an improper
purpose. Therefore ... an attorney's reckless misstatements of law and fact, when coupled with an
improper purpose, ... are sanctionable under a court's
inherent power.’ “ Id. (quoting Fink v. Gomez, 239
F.3d 989, 994 (9th Cir.2001)). “The imposition of
sanctions ... transcends a court's equitable power
concerning relations between the parties and reaches a
court's inherent power to police itself, thus serving the
dual purpose of vindicating judicial authority without
resort to the more drastic sanctions available for contempt of court and making the prevailing party whole
for expenses caused by his opponent's [misbehavior].”
Id. (quoting Chambers, 501 U.S. at 46).
Defendant asserts that Plaintiffs' counsel, William
Campbell of the Palmer Firm, fraudulently tried to

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negotiate a settlement on behalf of Jason Wilson, who
had predeceased any alleged violation by Defendant.
Id. at 22. Defendant also contends, “Plaintiffs counsel
was given two separate opportunities to file an
amended complaint that addressed the Court's orders,
yet counsel insisted on filing the same complaint time
and again.” Id. Thus, Defendant contends that Plaintiffs' counsel knew the case had no merit when it was
filed. Id.
First, the fact that Plaintiffs were unsuccessful in
stating a claim does not indicate that Plaintiffs' counsel acted in bad faith. Although all three complaints
filed in this case were similar, Plaintiffs attempted
each time to add facts sufficient to show that equitable
tolling was warranted. That the Court repeatedly
found equitable tolling unwarranted, and that Plaintiffs failed to state a claim, does not demonstrate that
Plaintiffs' counsel acted in bad faith.
Indeed, “the granting of a motion to dismiss the
complaint for failure to state a claim, or the granting of
a summary judgment against the pleader is not dispositive of the issue of sanctions.” Riverbend Ranch
Golf Course v. County of Madera, No. CV–F97–5550
REC/DLB, 2005 WL 3591906, *1 (E.D.Cal. Dec.29,
2005). The Court finds that counsel's conduct in this
regard in no way approaches the level of bad faith or
recklessness necessary for the Court to impose sanctions. There is no evidence of any misstatements of
facts or law by Plaintiffs, nor is there any indication,
as in the cases to which Defendants cite, that Plaintiffs
asserted their arguments to gain an advantage in other
litigation. See Mot. at 21 (citing Fink, 239 F.3d at 994;
In re Itel Secs. Litig., 791 F.3d 672, 675 (9th
Cir.1986)). Accordingly, the Court declines to exercise its inherent power to award sanctions for this
conduct.
*8 Defendant also contends that William Campbell fraudulently attempted to negotiate a settlement
on behalf of Jason Wilson, who is deceased. However,
Plaintiffs in this case are Velma Wilson and Barbara

Portal. Jason Wilson is not listed as a Plaintiff, nor is
he mentioned anywhere in the Complaint. His name
appears only in the subject line of the emails attached
to the Complaint regarding the parties' never-finalized
settlement agreement. Plaintiffs do not seek to enforce
this settlement agreement as to either Velma Wilson or
Jason Wilson. Rather, Plaintiffs cite to those settlement discussions to support their claim that equitable
tolling applies to the claims of Velma Wilson and
Barbara Portal. Whether Plaintiffs' counsel acted in
bad faith in negotiating a settlement which was never
finalized is simply not an issue for this Court to decide. The Court declines to act as an arbiter in determining what exactly happened in these settlement
negotiations on behalf of Jason Wilson, as they took
place well before this action was filed, involve a third
party to this case, and do not bear on the merit of
Plaintiffs' claims.
In sum, no grounds sufficient to justify sanctions
are before the Court. Mr. Campbell's actions have not
interfered with the Court's ability “to manage [its] own
affairs so as to achieve the orderly and expeditious
disposition of [its] cases.” Chambers, 501 U.S. at 43
(quoting Link v. Wabash R. Co., 370 U.S. 626,
630–631, 82 S.Ct. 1386, 8 L.Ed.2d 734 (1962)). It is
true that the Court's inherent power to sanction
“reaches both conduct before the court and that beyond the court's confines, for ‘[t]he underlying concern that gave rise to the contempt power was not ...
merely the disruption of court proceedings[, but]
[r]ather, ... disobedience to the orders of the Judiciary,
regardless of whether such disobedience interfered
with the conduct of trial.” Id. at 44 (quoting Young v.
United States ex rel. Vuitton et Fils S.A., 481 U.S. 787,
798, 107 S.Ct. 2124, 95 L.Ed.2d 740 (1987)). However, “[b]ecause of their very potency, inherent powers must be exercised with restraint and discretion.”
Id. at 44 (citing Roadway Express, 447 U.S. at 764).
Here, the Court exercises its restraint and discretion,
and Defendant's request for sanctions is denied.
CONCLUSION

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For the reasons set forth above, Defendant's Motion to Dismiss and Request for Sanctions, ECF No.
26, is GRANTED IN PART and DENIED IN PART.
Specifically:
1. Defendant's Motion to Dismiss is GRANTED
and Plaintiffs' FDCPA cause of action is DISMISSED WITH PREJUDICE.
2. The Clerk of the Court is ordered to REMAND
Plaintiffs' remaining state law causes of action to the
Superior Court of California, County of San
Joaquin.
3. Defendant's Request for Sanctions is DENIED.
IT IS SO ORDERED.
E.D.Cal.,2013.
Wilson v. Gordon & Wong Law Group, P.C.
Slip Copy, 2013 WL 6858975 (E.D.Cal.)
END OF DOCUMENT

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