Smith v. World Financial Network Bank
ORDER adopting Report and Recommendations re 2 Report and Recommendations. Signed by Judge James L. Graham on 2/6/2017. (ds)(This document has been sent by regular mail to the party(ies) listed in the NEF that did not receive electronic notification.)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
World Financial Network Bank,
Plaintiff Charmane Smith, a resident of Tennessee proceeding
pro se, filed the instant action against defendant World Financial
Network Bank. Plaintiff has used conclusory labels to describe her
claims sounding in products liability, including personal injury,
breach of warranty, and strict liability. Liberally construing the
complaint, plaintiff basically asserts that defendant was negligent
in designing its credit card products, resulting in hackers being
able to interfere with her accounts and her use of defendant’s
Plaintiff demands compensatory and economic damages
in the amount of ten billion dollars.
On January 20, 2017, the magistrate judge issued a report and
complaint pursuant to 28 U.S.C. §1915(e)(2).
The magistrate judge
concluded that plaintiff’s claims are state law claims and that she
has not pleaded any claims under federal law which would support
federal question jurisdiction.
Doc. 2, pp. 2-3.
judge also found that the complaint fails to allege sufficient
facts to support a finding that the amount in controversy exceeds
$75,000, a requirement for diversity jurisdiction under 28 U.S.C.
The magistrate judge recommended that the complaint be
dismissed for failure to assert any claim over which this court has
subject matter jurisdiction.
plaintiff’s objections (Doc. 5) to the magistrate judge’s report
and recommendation. If a party objects within the allotted time to
a report and recommendation, the court “shall make a de novo
determination of those portions of the report or specified proposed
findings or recommendations to which objection is made.” 28 U.S.C.
§636(b)(1); see also Fed. R. Civ. P. 72(b). Upon review, the Court
“may accept, reject, or modify, in whole or in part, the findings
or recommendations made by the magistrate judge.”
§1915(e) requires sua sponte dismissal of an action upon the
court’s determination that the action is frivolous or malicious, or
upon determination that the action fails to state a claim upon
which relief may be granted.
(6th Cir. 2008).
Grinter v. Knight, 532 F.3d 567, 572
When the face of the complaint provides no basis
for federal jurisdiction, the court may dismiss an action as
frivolous and for lack of subject matter jurisdiction under both 28
U.S.C. §1915(e)(2)(B) and Fed. R. Civ. P. 12(h)(3).
Cincy Urban Apts., No. 1:10-cv-153, 2010 WL 883846 at *2 n. 1 (S.D.
Ohio Mar. 9, 2010)(citing Carlock v. Williams, 182 F.3d 916
(table), 1999 WL 454880 at *2 (6th Cir. June 22, 1999)).
pro se complaint must be “liberally construed.”
v. Pardus, 551 U.S. 89, 94 (2007)(quoting Estelle v. Gamble, 429
U.S. 97, 106 (1976)).
Although a pro se complaint is held to less
stringent standards than formal pleadings drafted by attorneys, the
court need not accept as true legal conclusions or unwarranted
698 (6th Cir. 2006).
Montgomery v. Huntington Bank, 346 F.3d 693,
Nothing in the leniency accorded a pro se
filing excuses a plaintiff from compliance with the threshold
requirements of the Federal Rules of Civil Procedure. Carpenter v.
Springleaf Consumer Loan, Inc., No. 1:15-cv-666, 2016 WL 703678 at
*4 (S.D. Ohio Jan. 25, 2016), adopted by 2016 WL 696083 (S.D. Ohio
Feb. 22, 2016).
In her objections, plaintiff challenges the magistrate judge’s
conclusion that the vague and confusing allegations regarding the
type and amount of damages plaintiff sustained lacked sufficient
factual detail to show that plaintiff could recover in excess of
$75,000. Diversity jurisdiction is defeated when it “‘appear[s] to
a legal certainty that the claim is really for less than the
jurisdictional amount.’” Charvat v. GVN Mich., Inc., 561 F.3d 623,
628 (6th Cir. 2009)(quoting St. Paul Mercury Indem. Co. v. Red Cab
Co., 303 U.S. 283, 289 (1938)).
The amount alleged in the
complaint will suffice “as long as it is claimed in good faith[.]”
Charvat, 561 F.3d at 628.
Dismissal is proper if the amount
alleged in the complaint was never recoverable in the first
The party opposing dismissal has the burden of
proving subject matter jurisdiction.
Id. at 627.
allegations in the complaint need not be specific or technical in
nature, sufficient facts must be alleged to convince the district
court that recoverable damages will bear a reasonable relation to
the minimum jurisdictional floor.’”
Adams v. Reliance Standard
Life Ins. Co., 225 F.3d 1179, 1183 (10th Cir. 2000)(quoting State
Farm Mut. Auto Ins. Co. v. Narvaez, 149 F.3d 1269, 1272 (10th Cir.
The only specific damages plaintiff alleges in her complaint
is that defendant owes her $120 for overpayments on her credit card
Doc. 3, p. 6.
Plaintiff’s allegation that she
sustained damages in the amount of ten billion dollars is clearly
not made in good faith.
See Smith v. Phoenix Technologies Ltd.,
No. 11-CV-01479-LHK, 2011 WL 5444700 at **2-3 (N.D.Cal. Nov. 9,
2011)(dismissing another action filed by plaintiff pursuant to Fed.
R. Civ. P. 12(b)(1) for lack of subject matter jurisdiction where
plaintiff’s request for $2.8 billion in damages was not made in
The magistrate judge also noted that two actions
filed by plaintiff in Florida, in which she made threadbare and
conclusory allegations claiming damages in the sum of ten billion
jurisdictional amount. See Smith v. American Express, Case No. 17cv-60023-BB, Doc. 8, pp. 2-3 (S.D. Fla.) and Smith v. American
Express, Case No. 17-cv-60023-BB, Doc. 6, p.3 (S.D. Fla.).
Additional factors indicate that plaintiff cannot prove to a
legal certainty that she will be able to recover damages sufficient
to satisfy the jurisdictional amount.
Plaintiff alleges in her
complaint that the injuries resulting from defendant’s product
security flaws began on or before September 9, 2012.
law, the two-year statute of limitations in Ohio Rev. Code §2305.10
applies to products liability claims. Gates v. Precision Post Co.,
74 Ohio St.3d 439, 659 N.E. 2d 1241 (1996).
was filed on January 20, 2017, placing many or all of her damages
beyond the limitations period.
In addition, plaintiff has made
only general allegations of economic damages. Under Ohio law, such
damages are not recoverable in products liability cases in the
absence of injury to persons or physical damage to tangible
See Westfield Ins. Co. v. HULS Am., Inc., 128 Ohio
App.3d 270, 714 N.E.2d 934 (1998)(citing Queen City Terminals, Inc.
v. Gen. Am. Transp. Co., 73 Ohio St.3d 609, 653 N.E.2d 661 (1995)
and Chemtrol Adhesives, Inc. v. Am. Mfrs. Mut. Ins. Co., 42 Ohio
St.3d 40, 537 N.E.2d 624 (1989)).
Plaintiff’s complaint includes
no allegations which would permit her to recover the economic
damages she claims.
In her objections, plaintiff now contends that the harm she
sustained was at a minimum rate of $120 per year, which began to
accrue on September 9, 2012.
Doc. 5, p. 3.
considering this clarification, plaintiff has only specifically
identified $600 in damages. Plaintiff described no further damages
in her objections to the magistrate judge’s finding that the
jurisdictional threshold. Rather, she argues that her damages will
be revealed in discovery.
However, there is no general right to
discovery upon the filing of the complaint.
Yuhasz v. Brush
Wellman, Inc., 341 F.3d 559, 566 (6th Cir. 2003); c.f., Kolley v.
Adult Protection Services, 725 F.3d 581, 587 (6th Cir. 2013)
(plaintiff is not entitled to discovery before a motion to dismiss,
noting that the purpose of Fed. R. Civ. P. 12(b)(6) is to protect
defendants from expending resources on costly discovery for cases
that will not survive summary judgment).
In any event, plaintiff
would be expected to have possession of information concerning her
credit card accounts.
She would also be in the best position to
identify what type of damages she sustained as a result of the
alleged misuse of her credit cards by hackers.
Plaintiff is not
entitled to rely on future discovery in this case to establish the
Plaintiff also contends that the screening process under
§1915(e)(2) is unconstitutional, alleging that it inhibits access
to the courts by lay persons not skilled in the law.
constitutionality of §1915(e)(2) has been upheld against similar
See White v. Caruso, 39 F. App’x 75, 79 (6th Cir.
2002)(§1915(e)(2) does not deny access to the courts; it only
denies litigant the opportunity to pursue a frivolous claim in the
courts to which the litigant has no constitutional right); Hawkins
v. Morse, No. 98-2062, 194 F.3d 1312 (table), 1999 WL 1023780 at *2
meaningful access to courts merely because the court may sua sponte
dismiss a deficient complaint, as a meritorious claim will survive
The court concludes that the factual allegations in the
complaint are insufficient to show to a legal certainty that
plaintiff could recover over $75,000. Plaintiff’s claim of damages
in the amount of ten billion dollars was not made in good faith,
and the complaint fails to allege sufficient facts to convince this
court that recoverable damages will bear a reasonable relation to
the minimum jurisdictional floor. Adams, 225 F.3d at 1183. In her
objections to the magistrate judge’s report and recommendation,
plaintiff offered no additional information concerning her claims
which would suffice to satisfy her burden of showing that this
court has subject matter jurisdiction.
Having reviewed the report and recommendation and plaintiff’s
objections in accordance with 28 U.S.C. § 636(b)(1) and Rule 72(b),
the court finds that plaintiff’s objections are without merit. The
court overrules plaintiff’s objections (Doc. 5), and adopts the
magistrate judge’s January 20, 2017, report and recommendation
This action is hereby dismissed pursuant to 28 U.S.C.
§1915(e)(2)(B)(I) for lack of subject matter jurisdiction.
clerk shall enter judgement dismissing this case.
Date: February 6, 2017
s/James L. Graham
James L. Graham
United States District Judge
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