Bostock v. Westlake Financial Solutions LLC et al

Filing 39

REPORT AND RECOMMENDATIONS - IT IS THEREFORE RECOMMENDED THAT: 1. Defendant Westlake Services LLCs Motion For Judgment On The Pleadings (Doc. # 36 ) be granted, in part, as to Plaintiffs FDCPA claims and such federal claims be dismissed with prejudic e; the Court decline to exercise supplemental jurisdiction over Plaintiffs Ohio-law claims and such claims be dismissed without prejudice; 2. Plaintiffs FDCPA claims against Defendant Relentless Towing be dismissed with prejudice, and the Court decli ne to exercise supplemental jurisdiction over Plaintiffs Ohio-law claims against Relentless Towing and that her Ohio-law claims be dismissed without prejudice; and 3. The case be terminated on the Courts docket. Objections to R&R due by 2/19/2019. Signed by Magistrate Judge Sharon L. Ovington on 2/5/19. (kma)(This document has been sent by regular mail to the party(ies) listed in the NEF that did not receive electronic notification.)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION AT DAYTON
JATOYA D. BOSTOCK
Plaintiff,
vs.
WESTLAKE FINANCIAL
SOLUTIONS LLC., et al.
Defendants.

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Case No. 3:17-cv-325
District Judge Walter H. Rice
Magistrate Judge Sharon L. Ovington

REPORT AND RECOMMENDATIONS 1
I.

Introduction
Debt collectors must treat consumers fairly by aligning their conduct with the Fair

Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692, et seq. This is no small matter:
The FDCPA aims to “ ‘eliminate abusive debt collection practices by debt collectors.’ ”

Macy v. GC Services Limited Partnership, 897 F.3d 747, 759 (6th Cir. 2018) (quoting 15
U.S.C. § 1692(e)).
Pro se Plaintiff JaToya Bostock claims that Defendants Westlake Financial, Inc.
and its employee and/or agent Relentless Towing, Inc. violated the FDCPA by falsely
representing the character, amount, or legal status of a debt Plaintiff owed under the
terms of a car loan. Plaintiff also alleges that Defendants obscured the disclosures

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Attached is a NOTICE to the parties regarding objections to this Report and Recommendations.

required by the FDCPA. The case is pending upon Defendant Westlake’s Motion for
Judgment on the Pleadings (Doc. #36), to which Plaintiff has not responded.
II.

Pleading Standards
Review of a motion for judgment on the pleadings under Fed. R. Civ. P. 12(c)

applies the same pleading standards as review of a motion to dismiss for failure to state a
claim under Fed. R. Civ. P. 12(b)(6). Roth v. Guzman, 650 F.3d 603, 605 (6th Cir. 2011).
Like all plaintiffs facing a Rule 12(c) or 12(b)(6) Motion, the factual allegations
advanced in Plaintiff’s Complaint are accepted as true, and her Complaint is construed in
her favor. Jackson v. Professional Radiology Inc., 864 F.3d 463, 467 (6th Cir. 2017).
Given her pro se status, she is “afforded liberal construction of [her] pleadings and
filings.” Yagley v. Occupational Safety & Health Admin., 461 F. App’x 411, 414 (6th
Cir. 2012) (citing Boswell v. Mayer, 169 F.3d 384, 387 (6th Cir. 1999)).
Plaintiff’s Complaint must allege facts sufficient to notify Defendants of the
claims she asserts, and she must plead facts that are sufficient to identify a plausible legal
claim. Fritz v. Charter Tp. of Comstock, 592 F.3d 718, 722 (6th Cir. 2010) (citing
Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949-50 (2009) ). To be plausible,
Plaintiff’s legal claims must be more than merely possible. Id. “ ‘[A] legal conclusion
couched as a factual allegation’ need not be accepted as true ..., nor are recitations of the
elements of a cause of action sufficient.” Id. (citations omitted).
A Rule 12(c) “motion may be granted only if the moving party is ... clearly
entitled to judgment.” Tucker v. Middleburg-Legacy Place, 539 F.3d 545, 549 (6th Cir.
2008) (citation omitted). A party is clearly entitled to judgment under Rule 12(c) “if
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there is an absence of law to support a claim of the type made or of facts sufficient to
make a valid claim, or if on the face of the complaint there is an insurmountable bar to
relief indicating that the plaintiff does not have a claim.” Mayrides v. Delaware County
Comm'rs, 666 F.Supp.2d 861, 866 (S.D. Ohio 2009) (Marbley, D.J.) (citation omitted).
While the allegations in the complaint are the primary focus in assessing a
Rule 12(c) motion, “matters of public record, orders, items appearing in the
record of the case, and exhibits attached to the complaint [ ] also may be
taken into account,” Barany–Snyder v. Weiner, 539 F.3d 327, 332 (6th Cir.
2008) (quoting Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir. 2001)),
without converting the motion into one for summary judgment.”
Prado v. Mazeika, 3:16cv320, 2018 WL 4521935, at *3 (S.D. Ohio 2018) (Rice, D.J.).
III.

Plaintiff’s Factual Allegations
Accepting Plaintiff’s factual allegations as true and liberally construing her

Complaint in her favor, reveals the following. On June 3, 2016, Plaintiff purchased an
automobile from Mycol Auto Sales. She financed this purchase in part by borrowing
$7,613.53 from Mycol Auto, and Plaintiff and Mycol Auto documented this in a Retail
Installment Contract and Security Agreement. (Doc #2, PageID #s 66-72). On the same
day Mycol Auto and Plaintiff executed the Loan Agreement (June 3, 2016), Mycol Auto
assigned the loan to Defendant Westlake. Id. at 71. Although it seems trifling that the
Loan Agreement and assignment to Defendant Westlake occurred on the same day, much
turns on this timing, as will be explored after some additional facts are developed.
Plaintiff made multiple payments on her loan. Id. at 63-65. But, an August 2017
bill Defendant Westlake sent Plaintiff—another document attached to Plaintiff’s
Complaint—states that her past due amount was $461.04 plus her current amount due of
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$285.26 totaled her then-current amount due of $798.30. Id. at 59.
Plaintiff alleges that Defendant Westlake “falsely represented that [she] owed an
alleged car loan debt. However, [her] alleged debt was actually a line of credit and not a
loan, and as such, Defendant falsely represented the character, amount, or legal status of
[her] debt.” Id. at 51 (citation omitted). Plaintiff further asserts that Defendant Westlake
attempted to collect a debt with an initial written communication dated August 11, 2017,
stating:
As of the date of this statement, your account is 45 days past due for the
amount of [$]461.04. [I]t is urgent that you contact us IMMEDIATELY to
make acceptable arrangements to cure this serious default….
Id. at 59 (Plaintiff’s italics removed). This is an accurate, yet incomplete, quote from the
Notice section in the document Defendant Westlake sent Plaintiff in August 2017. See
id.
Plaintiff claims:
In stating [her] account was placed in ‘Prelegal status,’ Defendant implicitly
threatened that Plaintiff’s account would be … taken into further action if
payment was not made, an action Defendant did not actually intend to take,
and as such, Defendant falsely represented the character, amount or legal
status of [her] debt and further overshadowed and obscured the disclosures
required by 15 USC § 1692g(a) et seq. during the thirty-day dispute period.”
Id. (additional citations omitted).
Plaintiff characterizes Defendant’s conduct as highly offensive to a reasonable person.
Plaintiff alleges that on August 30, 2017, Defendant Westlake—through its agent
and/or employee Defendant Relentless Towing, Inc.—trespassed on her private properly
“and unlawfully obtained [her] private conveyance.” Id. at 50-51. Defendant Westlake
appears to acknowledge that after Defendant Relentless repossessed the vehicle, Plaintiff
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redeemed it. (Doc. #36, PageID #256 (citations omitted)).
Plaintiff seeks an award of actual and statutory damages under the FDCPA and
Ohio law.
IV.

Discussion
Defendant Westlake contends that it is entitled to judgment on the pleadings

because it is a not a “debt collector” as the FDCPA defines one; it is, instead, a “creditor”
to whom the FDCPA does not apply. (Doc. #36, PageID #s 258-59). Defendant
Westlake describes itself “as a creditor to Plaintiff attempting to collect on a debt…” that
Mycol Sales assigned to it before Plaintiff defaulted on the Loan Agreement. Id. at 257.
The FDCPA regulates the conduct of “debt collectors.” 5 U.S.C. 1692k(a); see
Bauman v. Bank of America, N.A., 808 F.3d 1097, 1100 (6th Cir. 2015) (“To prevail on a
claim under § 1692e, a plaintiff must establish that: … the defendant is a ‘debt collector’
as defined by the FDCPA ….”). The FDCPA’s wordy definition of “debt collector” is
“any person who uses any instrumentality of interstate commerce or the mails in any
business the principal purpose of which is the collection of any debts, or who regularly
collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be
owed or due another.” Montgomery v. Huntington Bank, 346 F.3d 693, 698 (6th Cir.
2003) (quoting 15 U.S.C. § 1692a(6)). Defendant Westlake would fit this definition if it
was in the business of regularly collecting debts owed to another, such as Mycol Auto
Sales. This is not the situation here, however, because the Loan Agreement attached to
Plaintiff’s Complaint establishes that Mycol Auto Sales assigned Plaintiff’s debt to
Defendant Westlake before her payments were past due in August 2017. This situation
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excludes Defendant Westlake from the FDCPA’s definition of “debt collector”:
“The legislative history of section 1692a(6) indicates conclusively that a debt
collector does not include the consumer’s creditors ... or an assignee of a
debt, as long as the debt was not in default at the time it was assigned. See
S.Rep. No. 95–382, 95th Cong., 1st Sess. 3, reprinted in 1977 U.S. Code
Cong. & Ad. News 1695, 1698. See also Kizer v. Finance America Credit
Corp., 454 F.Supp. 937, 939 (N.D. Miss.1978).”
Wadlington v. Credit Acceptance Corp., 76 F.3d 103, 106 (6th Cir. 1996) (quoting Perry
Stewart Title Co., 756 F.2d 1197, 1208 (5th Cir. 1985)). Plaintiff’s FDCPA claims
against Defendant Westlaw collapse under the weight of this statement in Wadlington.
Plaintiff was not in default on the date Mycol Auto Sales assigned the Loan Agreement to
Defendant Westlake. The assignment occurred on the same day Plaintiff purchased the
vehicle and entered into the Loan Agreement. Her account did not become significantly
past due until August 2017. See Doc. #2, PageID #s 59, 71. Because Plaintiff was not in
default on the terms of the Loan Agreement at the time Defendant Westlake became
assignee, Defendant Westlake falls outside the definition of “debt collector” under
FDCPA. See Wadlington, 76 F.3d at 106-07; cf. Glazer v. Chase Home Finance LLC,
704 F.3d 453, 457 (6th Cir. 2013) (mortgage servicer not a FDCPA “debt collector”
when servicer became assignee before mortgagee defaulted).
This leaves Defendant Relentless Towing as the sole remaining Defendant.
Naturally, Defendant Westlake’s Rule 12(c) Motion does not seek dismissal of Plaintiff’s
claims against Defendant Relentless Towing. Yet, liberally construing Plaintiff’s
Complaint in her favor, she has failed to raise a plausible FDCPA claim against
Relentless Towing because she merely alleges that Relentless Towing unlawfully
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detained her private conveyance—or, in other words, it repossessed her vehicle. “A
repossession agency … does not fall within the definition of ‘debt collector’ ” under the
FDCPA. Montgomery v. Huntington Bank, 346 F.3d 693, 699 (6th Cir. 2003).
Additionally, the Clerk of Court previously docketed an entry of default against
Relentless Towing. (Doc. #25). This entry of default does ripen into a default judgment
under Fed. R. Civ. P. 55 because Plaintiff’s Complaint fails to raise a plausible claim
against Relentless Towing. See Jackson v. Correctional Corporation of America, 564
F.Supp.2d 22, 26–27 (D.D.C. 2008) (and cases cited therein).
Lastly, having found Defendant Westlake’s Motion For Judgment On The
Pleadings well taken as to Plaintiff’s FDCPA claims, and Plaintiff’s FDCPA claims
against Relentless Towing’s subject to dismissal, exercise of the Court’s supplemental
jurisdiction over Plaintiff’s remaining Ohio-law claims is unwarranted. See 28 U.S.C. §
1367(c)(3); see also Winkler v. Madison County, 893 F.3d 877, 905 (6th Cir. 2018) (“a
federal court that has dismissed a plaintiff’s federal-law claims should not ordinarily
reach the plaintiff's state-law claims.”).
IT IS THEREFORE RECOMMENDED THAT:
1.

Defendant Westlake Services LLC’s Motion For Judgment On The
Pleadings (Doc. #36) be granted, in part, as to Plaintiff’s FDCPA claims
and such federal claims be dismissed with prejudice; the Court decline to
exercise supplemental jurisdiction over Plaintiff’s Ohio-law claims and
such claims be dismissed without prejudice;

2.

Plaintiff’s FDCPA claims against Defendant Relentless Towing be
dismissed with prejudice, and the Court decline to exercise supplemental
jurisdiction over Plaintiff’s Ohio-law claims against Relentless Towing and
that her Ohio-law claims be dismissed without prejudice; and

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3.

The case be terminated on the Court’s docket.

February 5, 2019

s/Sharon L. Ovington
Sharon L. Ovington
United States Magistrate Judge

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NOTICE REGARDING OBJECTIONS
Pursuant to Fed. R. Civ. P. 72(b), any party may serve and file specific, written
objections to the proposed findings and recommendations within FOURTEEN days after
being served with this Report and Recommendations. Pursuant to Fed. R. Civ. P. 6(d),
this period is extended to SEVENTEEN days because this Report is being served by one
of the methods of service listed in Fed. R. Civ. P. 5(b)(2)(C), (D), or (F). Such objections
shall specify the portions of the Report objected to and shall be accompanied by a
memorandum of law in support of the objections. If the Report and Recommendation is
based in whole or in part upon matters occurring of record at an oral hearing, the
objecting party shall promptly arrange for the transcription of the record, or such portions
of it as all parties may agree upon or the Magistrate Judge deems sufficient, unless the
assigned District Judge otherwise directs. A party may respond to another party’s
objections within FOURTEEN days after being served with a copy thereof.
Failure to make objections in accordance with this procedure may forfeit rights on
appeal. See Thomas v. Arn, 474 U.S. 140 (1985); United States v. Walters, 638 F.2d 947,
949-50 (6th Cir. 1981).

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