Broughton v. V.W. Credit Volkswagon

Filing 8

ORDER OF DISMISSAL... The Court dismisses this action because it lacks an arguable legal basis, fails to state a claim on which relief may be granted, and is frivolous. See 28 U.S.C. § 1915(e)(2)(B)(i), (ii). The Court declines to exercise its supplemental jurisdiction of any state law claims Plaintiff may be asserting. All other pending matters in this case are terminated.The Court certifies under 28 U.S.C. § 1915(a)(3) that any appeal from this order would not be taken in good faith , and therefore IFP status is denied for the purpose of an appeal. SeeCoppedge v. United States, 369 U.S. 438, 444-45 (1962).The Clerk of Court is directed to enter judgment in this action.SO ORDERED. (Signed by Judge Laura Taylor Swain on 5/6/24) (yv)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
TYRELL BROUGHTON,
Plaintiff,
23-CV-4884 (LTS)

-againstVW CREDIT; FINEST AUTOMOTIVE &
RECOVERY INC.,

ORDER OF DISMISSAL

Defendants.
LAURA TAYLOR SWAIN, Chief United States District Judge:
Plaintiff, who is proceeding pro se and in forma pauperis (“IFP”), filed this action
invoking the Court’s federal question jurisdiction and alleging that Defendant V.W. Credit
Volkswagen violated his rights. On August 28, 2023, the Court dismissed the complaint for
failure to state a claim, finding that it did not comply with federal pleading rules, but granted
Plaintiff leave to replead his claims in an amended complaint. Plaintiff filed an amended
complaint on October 27, 2023, which the Court has reviewed. For the reasons set forth below,
the Court dismisses this action.
BACKGROUND
Plaintiff filed his original pleading using the court’s general complaint form. He named
V.W. Credit Volkswagen as the sole defendant, invoked the court’s federal question jurisdiction,
and, in response to the question on the form asking which of his federal constitutional or federal
statutory rights had been violated, he wrote “multiple law’s I have documentation (proof).” (ECF
1, at 2.) In the statement of facts section, Plaintiff did not provide any facts, only claiming that he
“could not make certain doctor apointment’s and missed jobs apointments.” In the relief section,
he asserted “breach of peace.” (Id. at 6.) Plaintiff attached to the original complaint several
documents relating to debt collection on an auto loan, some of which were letters from Plaintiff

to VW Credit disputing the auto loan debt and demanding that the company cease further contact
under the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692.1
In the August 28, 2023 order, the Court found that because Plaintiff did not plead any
facts in the complaint describing any conduct on the part of Defendant, he had failed to comply
with the pleading requirements of Rule 8 of the Federal Rules of Civil Procedure, which requires
a short and plain statement giving a defendant fair notice of a plaintiff’s claims and the grounds
on which they rest. In fact, although the attachments to the complaint suggested that Plaintiff was
attempting to bring claims arising out of a disputed auto loan, he had provided so few facts that
the Court could not discern the nature of the claims he was attempting to assert. Because Plaintiff
had not articulated a viable legal claim, the Court dismissed the complaint for failure to state a
claim on which relief may be granted. See 28 U.S.C. § 1915(e)(2)(B)(ii).The Court, however,
granted Plaintiff leave to replead his claims in an amended complaint, noting that if he was
attempting to assert a claim under the FDCPA, he must allege facts in the amended complaint
indicating that the disputed debt arises from a consumer transaction as defined by the FDCPA,
and that Defendant is a debt collector within the meaning of the statute, who engaged in acts
prohibited by the statute.

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The FDCPA applies to consumer debt “arising out of . . . transaction[s] . . . primarily for
personal, family, or household purposes.” 15 U.S.C. § 1692a(5); Polanco v. NCO Portfolio
Mgmt., Inc., 930 F. Supp. 2d 547, 551 (S.D.N.Y. 2013) (“[T]he FDCPA is triggered when the
obligation is a debt arising out of a consumer transaction.”). The FDCPA prohibits those who
qualify as “debt collectors” from using deceptive and misleading practices, 15 U.S.C. § 1692e, or
engaging in “conduct the natural consequence of which is to harass, oppress, or abuse any person
in connection with the collection of a debt.” 15 U.S.C. § 1692d. The FDCPA defines a debt
collector as: (1) a person whose principal purpose is to collect debts; (2) a person who regularly
collects debts owed to another; or (3) a person who collects its own debts, using a name other
than its own as if it were a debt collector. 15 U.S.C. § 1692a(6).
2

In the amended complaint, Plaintiff names VW Credit and Finest Automotive &
Recovery Inc. (“Finest Automotive”), which appears to be a towing company, as Defendants. He
asserts breach of contract claims and violation of “UCC Codes,” “HJR 192,” “Public Law 7310,” the “Federal Reserve Act,” “Federal Banking Laws,” and the “Security Exchange
Commission Regulations.” (ECF 6, at 3.) Plaintiff alleges that he entered a contract with VW
Credit for the purchase of a 2022 Audi, but that the contract became “null and void” because of
VW Credit’s “failure to disclose to [him] the option of claiming 80% (eighty percent) of the
security interest of the car note pursuant to the Security Exchange Regulations.” (Id. at 2, 4.) On
February 9, 2023, however, Finest Automotive “illegally seized and repossessed” the vehicle in
violation of “New York Code Annotated § 11-9-609, which states that a secured creditor may
only repossess or seize the collateral of a debtor if there is no breach of peace involved in the
process.” (Id. at 4.) Plaintiff claims that Finest Automotive “breached the peace” by ignoring his
requests to wait for an attorney to arrive to supervise the towing of the vehicle. (Id.) He further
asserts that because VW Credit and Finest Automotive did not have an “official lien with the NY
Department of State pursuant to the Federal Uniform Commercial Codes,” they had no legal
standing to repossess the vehicle. Plaintiff also contends that Defendants violate “UCC § 9-610”
and breached the contract by repossessing the vehicle without giving him proper notice or going
to arbitration as required by the contract. He claims that as a result of Defendants’ actions, he has
suffered financial injury, and he seeks free and clear title to the vehicle, discharge of the debt,
and money damages.2

2

Plaintiff has filed another complaint in this court in which he named a different
defendant, but appears to assert claims that may be related to this one. See Broughton v. Truist
Bank, ECF 1:23-CV-6042, 1 (S.D.N.Y. filed July 13, 2023). On January 3, 2024, the Court
dismissed that complaint, but granted Plaintiff 30 days’ leave to replead his claims in an
amended complaint. ECF 1:23-CV-6042, 5.
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Plaintiff attaches to the amended complaint 22 pages of documents, most of which appear
to be communications between Plaintiff and VW Credit relating to the car loan and complaints
and other documents addressed to state courts in the States of New York and Washington.3 The
documents include a notice from VW Credit to Plaintiff dated September 6, 2023, stating that
Plaintiff had an unpaid balance for the vehicle loan and repossession expenses totaling
$21,426.82, and that VW Credit intended to retain the repossessed vehicle as collateral in
satisfaction of the amounts owed. (Id. at 8.)
DISCUSSION
A.

Federal Claims
Plaintiff makes it clear in the amended complaint that he seeks free and clear title to the

repossessed vehicle and discharge of his debt, along with money damages for alleged financial
injury that Defendants caused him to suffer. Plaintiff premises his federal claims on Defendants’
alleged violations of “HJR 192” and “Public Law 73-10” ‒ which reference the same statutory
provision ‒ and the “Federal Reserve Act,” “Federal Banking Laws,” and the “Security
Exchange Commission Regulations.”4 (ECF 6, at 2.)
The Court first considers Plaintiff’s assertion that Defendants violated HJR 192, which
refers to House Joint Resolution 192 of 1933, enacted by Pub. L. No. 73–10, 48 Stat. 112–13
(1933). The statutory provision was adopted by Congress to prohibit contracts that demand
payment in gold; the resolution suspended the gold standard in the United States.5 See H.J.R.

3

The Court was unable to find any state-court litigation concerning the repossession of
Plaintiff’s car.
4

While some of Plaintiff’s attachments to the amended complaint refer to the FDCPA, he
alleges no facts suggesting that he is bringing a claim under the statute.
5

HJR 192, titled, “To assure uniform value to the coins and currencies of the United
States,” states that obligations requiring payment “in gold or a particular kind of coin or
currency, or in an amount in money of the United States measured thereby” are against public
4

192, 73d Cong. (1933). Plaintiff’s citation to HJR 192 is seemingly a reference to “vapor
money,” “unlawful money” or “redemption” theories which are based on the premise that
“because the United States went off the gold standard in 1933 with the passage of HJR-192, ‘the
United States has been bankrupt and lenders have been creating unenforceable debts because
they are lending credit rather than legal tender.’” Green v. Pryce, No. 15-CV-3527, 2015 WL
4069176 at *2 (E.D.N.Y. July 1, 2015) (citation omitted) (collecting cases). These theories are
commonly used in efforts to avoid legitimate debts and courts have largely rejected relief based
on HJR 192. See McLaughlin v. CitiMortgage, Inc., 726 F. Supp. 2d 201, 214 (D. Conn. 2010)
(collecting cases). Because Plaintiff does not allege any facts suggesting that HJR 192 applies to
Defendants’ alleged actions, his claims under HJR 192 must be dismissed as lacking an arguable
legal basis. See Neitzke v. Williams, 490 U.S. 319, 325 (1989) (stating a claim is frivolous when
it “lacks an arguable basis either in law or in fact”); 28 U.S.C. § 1915(e)(2)(B)(i).
Plaintiff also asserts unspecified claims under the Federal Reserve Act, Federal Banking
Laws, and the Security Exchange Commission Regulations. Because Plaintiff does not allege any
facts indicating how these statutes are applicable to his claims, the Court finds that he has failed
to state claims under these laws on which relief may be granted. See 28 U.S.C.
§ 1915(e)(2)(B)(ii).
B.

State Law Claims
Plaintiff asserts state law claims against Defendants, including breach of contract and

violation of the Uniform Commercial Code (“UCC”).6 A district court, however, may decline to

policy, and that U.S. currency is legal tender for all debts. See H.J.R. Res. 192, 73d Cong.
(1933).
6

Plaintiff refers to the UCC as if it is a federal law. The UCC, however, is not a federal
law but rather a set of model laws governing commercial transactions in the United States that
have been adopted separately by the states. See Kemp v. United States, 124 Fed. Cl. 387, 393
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exercise supplemental jurisdiction of state law claims when it “has dismissed all claims over
which it has original jurisdiction.”7 28 U.S.C. § 1367(c)(3). Generally, “when the federal-law
claims have dropped out of the lawsuit in its early stages and only state-law claims remain, the
federal court should decline the exercise of jurisdiction.” Carnegie-Mellon Univ. v. Cohill, 484
U.S. 343, 350 n.7 (1988). Having dismissed the federal claims of which the Court has original
jurisdiction, the Court declines to exercise its supplemental jurisdiction of any state law claims
Plaintiff may be asserting. See Kolari v. New York-Presbyterian Hosp., 455 F.3d 118, 122 (2d
Cir. 2006) (“Subsection (c) of § 1367 ‘confirms the discretionary nature of supplemental
jurisdiction by enumerating the circumstances in which district courts can refuse its exercise.’”
(quoting City of Chicago v. Int’l Coll. of Surgeons, 522 U.S. 156, 173 (1997))).
C.

Leave to Amend Denied
District courts generally grant a pro se plaintiff leave to amend a complaint to cure its

defects, but leave to amend may be denied if the plaintiff has already been given an opportunity
to amend but has failed to cure the complaint’s deficiencies. See Ruotolo v. City of New York,
514 F.3d 184, 191 (2d Cir. 2008); Salahuddin v. Cuomo, 861 F.2d 40, 42 (2d Cir. 1988). Because

(2015); Moss v. Stanley, No. 8:20-CV-3194, 2020 WL 6111002, at *2 (D.S.C. October 16,
2020); Dillard v. BMW Fin. Servs. NA, LLC, No. GJH-19-1191, 2020 WL 869223, at *2 (D. Md.
February 20, 2020)
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Plaintiff does not allege facts suggesting that his state law claims fall under the Court’s
diversity of citizenship jurisdiction. To establish diversity jurisdiction under 28 U.S.C. § 1332, a
plaintiff must first allege that the plaintiff and the defendant are citizens of different states. Wis.
Dep’t of Corr. v. Schacht, 524 U.S. 381, 388 (1998). In addition, the plaintiff must allege to a
“reasonable probability” that the claim is in excess of the sum or value of $75,000.00, the
statutory jurisdictional amount. See 28 U.S.C. § 1332(a); Colavito v. N.Y. Organ Donor Network,
Inc., 438 F.3d 214, 221 (2d Cir. 2006) (citation and internal quotation marks omitted). Here,
Plaintiff fails to allege facts demonstrating diversity of citizenship because it appears that both he
and Defendant Finest Automotive are citizens of New York, precluding diversity jurisdiction.
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Plaintiff’s amended complaint does not suggest that he could bring viable claims with further
amendment, the Court declines to grant Plaintiff another opportunity to amend.
CONCLUSION
The Court dismisses this action because it lacks an arguable legal basis, fails to state a
claim on which relief may be granted, and is frivolous. See 28 U.S.C. § 1915(e)(2)(B)(i), (ii).
The Court declines to exercise its supplemental jurisdiction of any state law claims Plaintiff may
be asserting. All other pending matters in this case are terminated.
The Court certifies under 28 U.S.C. § 1915(a)(3) that any appeal from this order would
not be taken in good faith, and therefore IFP status is denied for the purpose of an appeal. See
Coppedge v. United States, 369 U.S. 438, 444-45 (1962).
The Clerk of Court is directed to enter judgment in this action.
SO ORDERED.
Dated:

May 6, 2024
New York, New York
/s/ Laura Taylor Swain
LAURA TAYLOR SWAIN
Chief United States District Judge

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