Thymes v. Gillman Companies et al
MEMORANDUM OPINION AND ORDER dismissing with prejudice Claims (1) and (3) of 1 Complaint. (Amended Complaint due by 3/29/2018.) (Signed by Judge Sim Lake) Parties notified. (aboyd, 4)
United States District Court
Southern District of Texas
March 09, 2018
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
DERRICK W. THYMES
David J. Bradley, Clerk
CIVIL ACTION NO. H-17-2834
GILLMAN COMPANIES AND GILLMAN
MEMORANDUM OPINION AND ORDER
Pending before the court is Defendant's Motion to Dismiss
Under Rules of Civil Procedure 12(b)
(Docket Entry No. 7) and the Plaintiff's Opposition to
Defendant's Motion to Dismiss
violations of the Federal Trade Commission ("FTC") Safeguard Rule
( "GLBA") ;
disclosure of private consumer financial information in violation
identity theft and fraud;
See Complaint, Docket Entry No. 1, pp. 4-10.
See Defendant's Motion to Dismiss Under Rules of Civil
Procedure 12(b) (6) and 9(b) ("Motion to Dismiss"), Docket Entry
Causes of Action (1) and (3)
Having considered the arguments and authorities cited by the
parties the court concludes that the Plaintiff has no cause of
action under the GLBA,
Safeguard Rule, 16 C.F.R.
6801 et ggg or under the FTC
314.1 et seg.
Neither the GLBA nor the
FTC Safeguards Rule authorizes a private cause of action.
6805(a) of the GLBA provides an express enforcement mechanism that
this subchapter and the regulations prescribed thereunder
shall be enforced by the Bureau of Consumer Financial
Protection, the Federal functional regulators, the State
insurance authorities, and the Federal Trade Commission
with respect to financial institutions and other persons
subject to their jurisdiction under applicable law . . .
Section 314.1 of
FTC Safeguard Rule
states that it "implements Sections  and [6805(b) (2)] of the
Courts in the
Northern District of Texas have held that the "GLBA does not create
a private right of action."
Civil Action No.
Nov. 5, 2014)
Hall v. Phenix Investigations, Inc.,
2014 WL 5697856,
Borinski v. Williamson, Civil Action No. 3:02-1014,
2004 WL 433746, at *3 (N.D. Tex. March 1, 2004).
The court in Hall
explained that "[c]onsidering that Congress expressly provided for
administrative and criminal enforcement of GLBA,
intended private action.'"
'it is highly
2014 WL 5697856 at *9
Transamerica Mortgage Advisors, Inc. v. Lewis, 100 S. Ct. 242, 247
Based on the plain readings of the statute and the regulation,
the court agrees with the holdings of Hall and Borinski that the
GLBA does not provide a private right of action.
Because the FTC
Safeguards Rule implements the enforcement provision of the GLBA,
and because the GLBA does not provide a private cause of action,
the court concludes that the FTC Safeguards Rule does not provide
a private cause of action.
Therefore Plaintiff's claims under the
GLBA and the FTC Safeguard Rule, causes of action number (1) and
number (3), will be dismissed.
Cause of Action (2)
To state a
claim for negligence in Texas a plaintiff must
plead facts showing (1) the existence of a legal duty;
(2) a breach
of that duty; and (3) damages proximately caused by that breach.
Boudreaux v. Swift Transportation Co., Inc., 402 F.3d 536, 540-41
(5th Cir. 2005).
Accepting all of Plaintiff's factual allegations
as true the court concludes that Plaintiff has pled enough facts to
plausibly state a claim for relief for negligence.
Cause of Action (4}
Defendant argues that because Plaintiff's cause of action for
identity theft and fraud
statutory claim by its elements,
to identify any common law or
does not even allege any
wrongful conduct against Gillman Subaru or the named Defendants
it should be dismissed. " 3
The court agrees.
crimes with his personal information" 4 and that
heretofore misused his personal information." 5
Plaintiff fails to
allege that Defendant committed any wrongful act under common law
requirements for a common law fraud claim.
Procedure 9 (b)
Federal Rule of Civil
imposes a heightened pleading standard on fraud
See United States ex rel.
417 F.3d 450,
A party must
state with particularity circumstances alleged to constitute fraud.
See Campbell v. Bravo Credit, Civil Action No. H-14-2794, 2015 WL
precedent interprets Rule 9(b) strictly, requiring the plaintiff to
specify the statements contended to be fraudulent,
speaker, state when and where the statements were made, and explain
why the statements were fraudulent."
Income Fund, Inc. v. TXU Corp., 565 F.3d 200, 207 (5th Cir. 2009)
Plaintiff has not pled the "who,
and where" of the
to state a claim for common law
Motion to Dismiss, Docket Entry No. 7, p. 5.
Complaint, Docket Entry No. 1, p. 7
Id. p. 7
Cause of Action (5)
Plaintiff's Complaint alleges:
that by accepting receipt of Plaintiff's personal data,
Defendants obligated themselves to securely protect and
safeguard that information from disclosure to cybercriminals, rogue employees and the like; Defendants
herein failed in their obligation to the Plaintiff. 6
Defendant argues that Plaintiff's cause of action for breach of
implied contract should be dismissed because Plaintiff has not pled
any facts that support the elements of a breach of implied contract
In his Opposition Defendant's Motion to Dismiss, Plaintiff
argues that "the breach of implied contract references the breach
of Defendants' duty as imposed by both the [Fair Credit Reporting
Act] and the [Texas Deceptive Trade Practices-Consumer Protection
Act] to safeguard the personal data of consumers that they have in
custody and control." 8
Plaintiff misunderstands the elements of a
claim for breach of implied contract.
plaintiff must plead the existence of a valid implied contract,
performance or tendered performance by the plaintiff, breach of the
implied contract by the defendant, and damages resulting from the
Id. p. 8
Motion to Dismiss, Docket Entry No. 7, p. 6.
Plaintiff's Opposition to Defendant's Motion to Dismiss,
Docket Entry No. 10, p. 6.
Electrostim Medical Services, Inc. v. Health Care Service
To plead the
existence of a valid implied contract, a plaintiff must establish
"(1) an offer,
(2) an acceptance,
(3) a meeting of the minds,
each party's consent to the terms, and (5) execution and delivery
of the contract with the intent that it be mutual and binding."
Because Plaintiff has not pled facts that would plausibly
support the elements of a breach of implied contract,
fails to state a claim upon which relief may be granted.
Conclusion and Order
the GLBA and the
FTC Safeguard Rule
Plaintiff is ordered to amend his complaint within 20 days setting
forth the facts to support these claims.
SIGNED at Houston, Texas, on this the 9th day of March,
UNITED STATES DISTRICT JUDGE
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?