VILLA v. ALLY FINANCIAL, INC. et al
Filing
24
MEMORANDUM OPINION AND ORDER signed by MAG/JUDGE L. PATRICK AULD on 2/28/2014; that Plaintiff's Motion to Strike Affirmative Defenses (Docket Entry 17 ) is GRANTED IN PART, in that the Third and Fifth Defenses are STRICKEN, but w ithout prejudice to Defendant Experian's filing of an amended answer specifically stating the basis for its Fifth Defense no later than March 14, 2014, and DENIED IN PART, in that the First Defense may stand, but without the prospect of court action absent the making of a proper motion. (Sheets, Jamie)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
JANNIE GARCIA VILLA,
)
)
)
)
)
)
)
)
)
Plaintiff,
v.
ALLY FINANCIAL, INC., et al.,
Defendants.
1:13CV953
MEMORANDUM OPINION AND ORDER
This case comes before the Court on Plaintiff’s Motion to
Strike Affirmative
Solutions, LLC.
Defenses
of
Defendant
(Docket Entry 17.)
Experian
Information
For the reasons that follow,
the Court will grant the instant Motion in part (as to the third
and fifth defenses, but with leave to amend the fifth defense) and
will deny it in part (as to the first defense).1
BACKGROUND
Plaintiff’s Complaint asserts violations of the Fair Credit
Reporting Act (“FCRA”) by Defendants Experian and Ally.
1
(Docket
The undersigned United States Magistrate Judge will issue an
Order because motions of this sort do not appear in the list of
pretrial matters which require submission of a recommendation. See
28 U.S.C. § 636(b)(1)(A) and (B); see also Hargrove v. Ryla
Teleservs., Inc., No. 2:11CV344, 2012 WL 463442, at *1 (E.D. Va.
Feb. 13, 2012) (unpublished) (referring to motions to strike as
“non-dispositive pre-trial matters”); Home Mgmt. Solutions, Inc. v.
Prescient, Inc., No. 07-20608-CIV, 2007 WL 2412834, at *1 n.1 (S.D.
Fla. Aug. 21, 2007) (unpublished) (“It is well settled that motions
to amend or strike pleadings are non-dispositive motions that may
be referred and ruled upon by a magistrate judge by order unless
they have a dispositive effect.”).
Entry 6 at 7-10.)
It alleges that in January or February 2013,
Plaintiff discovered an error in her credit report, as prepared by
Defendant
Experian,
concerning
an
automobile
loan
issued
by
Defendant Ally. (Id. at 3-6.) After both Defendants filed Answers
(Docket Entries 9, 10), Plaintiff contacted Defendant Experian
regarding several affirmative defenses contained within its Answer.
(Docket Entry
18 at 2; see also Docket Entry 21 at 2.)
Defendant
Experian agreed to remove some of these affirmative defenses
(Docket Entry
18 at 2; see also Docket Entry 21 at 2) and filed an
Amended Answer (Docket Entry 12).
Plaintiff now moves to strike the following three affirmative
defenses from Defendant Experian’s Amended Answer:
FIRST AFFIRMATIVE DEFENSE
The Complaint herein, and each cause of action
thereof, fails to set forth facts sufficient to state a
claim upon which relief may be granted against Experian
and further fails to state facts sufficient to entitle
Plaintiff to the relief sought, or to any relief
whatsoever from Experian.
. . . .
THIRD AFFIRMATIVE DEFENSE
The Complaint and each claim for relief therein is
barred by laches.
. . . .
FIFTH AFFIRMATIVE DEFENSE
Experian is informed and believes and thereon
alleges that some or all claims for relief in the
Complaint herein are barred by the applicable statutes of
limitation, including but not limited to 15 U.S.C. §
1681p.
(Id. at 16; see also Docket Entry 17 at 12-16.) Defendant Experian
-2-
responded in opposition.
reply.
(Docket Entry 21.)
Plaintiff did not
(See Docket Entries dated Jan. 2, 2014, to present.)
DISCUSSION
“Federal Rule of Civil Procedure 12(f) permits a district
court, on motion of a party, to ‘order stricken from any pleading
any insufficient defense.’” Waste Mgmt. Holdings, Inc. v. Gilmore,
252 F.3d 316, 347 (4th Cir. 2001) (quoting 5A Wright & Miller,
Federal Practice & Procedure § 1380 (2d ed. 1990)). Although “Rule
12(f) motions are generally viewed with disfavor . . . , a ‘defense
that might confuse the issues in the case and would not, under the
facts alleged, constitute a valid defense to the action can and
should be deleted.’”
Id. (quoting 5A Wright & Miller, supra, §
1380); see also Fed. R. Civ. P. 12(f) (“The court may strike from
a pleading an insufficient defense or any redundant, immaterial,
impertinent, or scandalous matter.”).
In addition, the moving
party must show prejudice: for instance, where an “irrelevant
affirmative defense . . . ‘result[s] in increased time and expense
of trial, including the possibility of extensive and burdensome
discovery.’” Staton v. North State Acceptance, LLC, No. 1:13CV277,
2013 WL 3910153, at *2 (M.D.N.C. July 29, 2013) (unpublished)
(quoting Canadian St. Regis Band of Mohawk Indians ex rel. Francis
v. New York, 278 F. Supp. 2d 313, 325 (N.D.N.Y. 2003)).
-3-
Finally,
“[w]hen reviewing a motion to strike, a court must view the
pleading under attack in a light most favorable to the pleader.”
Guessford v. Pennsylvania Nat’l Mut. Cas. Co., 918 F. Supp. 2d 453,
467 (M.D.N.C. 2013).
Plaintiff contends that this Court, in evaluating Defendant
Experian’s affirmative defenses, should apply the pleading standard
articulated by the United States Supreme Court in Bell Atl. Corp.
v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S.
662 (2008).
(Docket Entry 18 at 4-8.)
In that regard, Plaintiff
emphasizes that a majority of district courts within the Fourth
Circuit (though not this Court) have applied Twombly and Iqbal to
affirmative defenses.
(Id. at 5-7 (citing cases).)
Responding in
opposition, Defendant Experian underscores that this Court (per
United States District Judge James A. Beaty, Jr.) has previously
declined to extend Twombly and Iqbal to affirmative defenses given
the language of the Federal Rules of Civil Procedure and the
existing state of the law in the Fourth Circuit.
(Docket Entry 21
at 4 (citing Guessford, 918 F. Supp. 2d at 468).)
In this case, because Defendant Experian’s third and fifth
affirmative defenses do not survive the pleading standards imposed
by Federal Rule of Civil Procedure 8 - and because its first
affirmative defense does not constitute an affirmative defense at
all - the Court need not resolve whether the Twombly/Iqbal standard
applies to affirmative defenses.
See Staton, 2013 WL 3910153, at
-4-
*2-3
(declining
to
consider
applying
Twombly
and
Iqbal
to
affirmative defenses and striking several such defenses under Rule
8).
Under Rule 8, “[a]t a minimum, . . . a statement of an
affirmative defense must give notice to an opponent of its basis
and go beyond conclusions.”
Id. at *3.
Moreover, to survive a
motion to strike, a defendant must offer more than a “bare-bones
conclusory allegation which simply names a legal theory but does
not indicate how the theory is connected to the case at hand.”
Merrill Lynch Bus. Fin. Servs., Inc. v. Performance Mach. Sys.
U.S.A., Inc., No. 04-60861-CIVMARTINEZ, 2005 WL 975773, at *12
(S.D. Fla.
Mar.
4,
2005)
(unpublished).
Thus,
even
without
considering Twombly and Iqbal, “dismissal under Rule 12(f) is
appropriate where the defendant has not articulated its defenses so
that they are contextually comprehensible.”
Odyssey Imaging, LLC
v. Cardiology Assocs. of Johnston, LLC, 752 F. Supp. 2d 721, 726
(W.D. Va. 2010).
Defendant Experian’s first affirmative defense asserts that
Plaintiff’s Complaint “fails to set forth facts sufficient to state
a claim upon which relief may be granted against [Defendant]
Experian and further fails to state facts sufficient to entitle
Plaintiff to the relief sought . . . .”
(Docket Entry 12 at 16.)
Said defense appears to restate the standard for a motion to
dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6).
Although an answer may assert such a defense, see Fed. R. Civ. P.
-5-
12(h)(2)(A) (citing Fed. R. Civ. P. 7(a))), failure to state a
claim does not constitute an affirmative defense, see Boldstar
Technical, LLC v. Home Depot, Inc., 517 F. Supp. 2d 1283, 1292
(S.D. Fla. 2007) (“Failure to state a claim is a defect in the
plaintiff’s claim; it is not an additional set of facts that bars
recovery
notwithstanding
the
plaintiff’s
valid
prima
facie
case.”).2
Some district courts have stricken such defenses under similar
circumstances.
See Odyssey Imaging, 752 F. Supp. 2d at 727
(striking purported affirmative defense that the “complaint fails
to state a cause of action” because it is “not an affirmative
defense[] at all”); Clark v. Milam, 152 F.R.D. 66, 73 (S.D. W. Va.
1993)
(granting
“affirmative
motion
defenses
to
[which]
Plaintiff’s allegations”).
strike
are
in
as
superfluous
fact
merely
several
denials
of
Other district courts have concluded
that, in the case of mere mislabeling of such a defense, “striking
the defense at this juncture would serve no real purpose.”
2
U.S.
Defendant Experian references the inclusion of failure to
state a claim as a defense in Form 30 of the Federal Rules of Civil
Procedure, “Answer Presenting Defenses Under Rule 12(b).”
(See
Docket Entry 21 at 7 (citing Fed. R. Civ. P. Form 30).) Despite
Form 30’s inclusion of this defense, it does not list failure to
state a claim as an affirmative defense, as it does for a defense
based on the statute of limitations. See Fed. R. Civ. P. Form 30;
U.S. Commodities Futures Trading Comm’n v. U.S. Bank, N.A., No.
13CV2041-LRR, 2014 WL 294219, at *6 n.6 (N.D. Iowa Jan. 27, 2014)
(unpublished) (“The court notes that although Form 30 allows a
defendant to allege that a plaintiff failed to state a claim in an
answer, it does not categorize failure to state a claim as an
affirmative defense.”).
-6-
Bank Nat’l
(RHK/JJG),
Ass’n
2011
v. Education
WL
5520437,
Loans,
at
*7
Inc.,
(D.
Civ.
Minn.
No.
Nov.
11-1445
14,
2011)
(unpublished); accord Haley Paint Co. v. E.I. Du Pont De Nemours &
Co., 279 F.R.D. 331, 337 (D. Md. 2012).
The Court agrees with this
latter perspective.
Accordingly, given that Defendant Experian
properly
included
could
have
its
purported
first
affirmative
defense in its Answer under a different heading, the Court will
simply construe the Answer as having done so.
Moreover, the Court
concludes that the failure of Defendant Experian to include any
detail as to the basis for its defense of failure to state a claim
causes Plaintiff no prejudice because the Court will take no action
on the defense unless and until Defendant Experian makes a proper
motion, see Fed. R. Civ. P. 7(b)(1) (“A request for a court order
must be made by motion.”), and Defendant Experian may raise that
defense at any time up to trial, see Fed. R. Civ. P. 12(h)(2).
The
Court therefore declines to strike Defendant Experian’s defense of
failure to state a claim.
Defendant Experian’s third affirmative defense contends that
“[Plaintiff’s] Complaint and each claim for relief therein is
barred by laches.”
(Docket Entry 12 at 16.)
Because Plaintiff’s
Complaint alleges a dispute arising out of events which occurred in
early 2013 (see Docket Entry 6 at 3-6), simply asserting that the
equitable doctrine of laches bars the Complaint does not connect
the
theory
to
the
instant
case
-7-
and,
thus,
does
not
provide
Plaintiff with sufficient notice of the defense under Rule 8.
“[E]ven before Twombly and Iqbal, the defenses of waiver, estoppel
and laches were consistently struck when pled without reference to
some facts.”
Topline Solutions, Inc. v. Sandley Sys., Inc., Civ.
No. L-09-3102, 2010 WL 2998836, at *2 (D. Md. July 27, 2010)
(unpublished); accord Palmer v. Oakland Farms, Inc., No. 5:10CV29,
2010 WL 2605179, at *6 (W.D. Va. June 24, 2010) (unpublished).
Moreover, because Plaintiff seeks no equitable relief in her
Complaint (see Docket Entry 6 at 11-12), an equitable defense, such
as laches, does not constitute a legally sufficient defense.
See
Staton, 2013 WL 3910153, at *4 (finding equitable defense legally
insufficient in FCRA case where defendant cited no case law to
support its validity and striking it with prejudice); Guessford,
918 F. Supp. 2d at 469 (striking equitable defense of unclean hands
where Plaintiff sought no equitable relief).
Furthermore, “when
considering the timeliness of a cause of action brought pursuant to
a statute for which Congress has provided a limitations period, a
court
should
not
apply
laches
to
overrule
the
legislature’s
judgment as to the appropriate time limit to apply for actions
brought under the statute.” Lyons P’ship, L.P. v. Morris Costumes,
Inc., 243 F.3d 789, 798 (4th Cir. 2001); see also 15 U.S.C. § 1681p
(providing for limitations period of two to five years for FCRA).
Defendant Experian requests leave to amend (see Docket Entry
21 at 10, 12) and, “when affirmative defenses are stricken, the
-8-
defendant should normally be granted leave to amend,” Bradshaw v.
Hilco Receivables, LLC, 725 F. Supp. 2d 532, 535 (D. Md. 2010).
However, in this instance, the Court declines to grant such leave
because, for the reasons stated above, laches would not constitute
a valid defense in this case even if, as Defendant Experian
alleges, Plaintiff “slept on her rights” (Docket Entry 21 at 8).
Under these circumstances, the Court will strike (without leave to
amend) Defendant Experian’s third affirmative defense.
Defendant Experian’s fifth affirmative defense asserts “that
some or all claims for relief in the Complaint herein are barred by
the applicable statutes of limitation, including but not limited to
15 U.S.C. § 1681p.”
of
the
FCRA
(Docket Entry 12 at 16.)
provides
for
a
limitations
The cited provision
period
of
two
years
following the discovery of a violation or five years from the date
of the violation.
15 U.S.C. § 1681p.
As discussed above,
Plaintiff’s Complaint apparently arises from events alleged to have
occurred less than one year before she filed it.
at
3-6.)
Without
some
reference
to
the
(Docket Entry 6
operative
dates
or
indication of when Defendant Experian contends that Plaintiff’s
cause
of
action
accrued,
said
defense
lacks
the
requisite
contextual coherence to give Plaintiff sufficient notice.
Compare
Rushing v. Time Warner, Inc., No. 3:05CV474-H, 2006 WL 517674, at
*2 (W.D.N.C. Mar. 1, 2006) (unpublished) (granting motion to strike
statute-of-limitations affirmative defense where parties agreed as
-9-
to which statute applied and defendant raised no dispute as to
dates
involved),
with
Sauber
Painting
&
Decorating,
Inc.
v.
International Union of Painters & Allied Trades Dist. Council No.
30, No. 04C170, 2004 WL 1244133, at *3 (N.D. Ill. June 3, 2004)
(unpublished) (denying motion to strike statute-of-limitations
defense because reference to relevant time periods and statutory
support provided adequate notice to Plaintiff).
Defendant Experian’s brief describes its position somewhat,
alleging
that
Plaintiff’s
claim
may
arise
from
events
occurred “at least as early as 2010, and perhaps earlier.”
which
(See
Docket Entry 21 at 9-12.) Nonetheless, Defendant Experian must set
forth some details in its Answer as to its basis for asserting a
statute of limitations defense. At a bare minimum, the Answer must
state when Defendant Experian alleges that Plaintiff’s cause of
action accrued.3
Under these circumstances, the Court will strike
Defendant Experian’s fifth affirmative defense without prejudice to
the filing of an appropriate amendment.
As a final matter, with respect to Plaintiff’s required
showing
of
litigation
prejudice,
of
these
her
Motion
unsupported,
contends
“that
insufficient,
and
continued
otherwise
improper affirmative defenses prejudices her by unduly increasing
3
Form 30 of the Federal Rules of Civil Procedure encourages
pleading an affirmative defense based on the statute of limitations
as follows: “The plaintiff’s claim is barred by the statute of
limitations because it arose more than _____ years before this
action was commenced.” Fed. R. Civ. P. Form 30.
-10-
the time, expense, and complexity of the litigation of this matter,
particularly in that it will require extended discovery . . . to
adequately determine on exactly what basis Defendant [Experian]
claims these defenses.”
(Docket Entry 18 at 16.)
Specifically,
Plaintiff asserts that she “will have to use up some of her limited
discovery requests and time to figure out exactly what the factual
bases are for these seemingly random defenses.”
(Id.)
Defendant
Experian responds that any “affirmative defenses that are not
[later] supported by discovery can simply be ignored.”
Entry 21 at 13.)
(Docket
This Court (per United States District Judge
Catherine C. Eagles) recently stated that “irrelevant affirmative
defenses prejudice plaintiffs where they result in increased time
and expense of trial, including the possibility of extensive and
burdensome discovery.”
Staton, 2013 WL 3910153, at *2 (internal
quotation marks omitted).
Under these circumstances, the Court
finds that Plaintiff would suffer sufficient prejudice as to the
third and fifth defenses to warrant relief under Rule 12(f).
CONCLUSION
Defendant Experians’s asserted affirmative defenses of laches
and statute of limitations do not meet the standard set by Rule 8.
-11-
IT IS THEREFORE ORDERED that Plaintiff’s Motion to Strike
Affirmative Defenses (Docket Entry 17) is GRANTED IN PART, in that
the Third and Fifth Defenses are STRICKEN, but without prejudice to
Defendant Experian’s filing of an amended answer specifically
stating the basis for its Fifth Defense no later than March 14,
2014, and DENIED IN PART, in that the First Defense may stand, but
without the prospect of court action absent the making of a proper
motion.
/s/ L. Patrick Auld
L. Patrick Auld
United States Magistrate Judge
February 28, 2014
-12-
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?